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Fair Debt Collection: 3.4.1 Construing the Language of the Act

The language of the FDCPA is the first point of reference in any action under the Act.104 Congress spent years crafting the final language and policies of the FDCPA.105 Ignoring the carefully chosen language of the FDCPA would frustrate congressional will and authority.106 Moreover, as “a ‘comprehensive and reticulated’ statutory scheme, involving clear definitions, precise requirements, and particularized remedies,” the courts should not impose co

Fair Debt Collection: 3.4.2.1 1977 Act

The FDCPA was signed at a White House ceremony on September 20, 1977, and became law on March 20, 1978. Because the bill that became the FDCPA was drafted by the Senate, the most useful piece of legislative history is Senate Report 382,116 which describes the provisions of the bill and the intentions of its drafters. This report was written by the Senate Committee on Banking, Housing, and Urban Affairs (the Senate Banking Committee) to accompany the bill adopted by the Senate in August 1977, and by the House shortly thereafter.

Fair Debt Collection: 3.4.2.2 1986 Amendment

The coverage of attorneys by the Fair Debt Collection Practices Act was expanded by Congress in 1986.141 An attorney who regularly collects consumer debts is now subject to all provisions of the FDCPA.142 The 1986 amendment deleted the language which had exempted attorneys acting “as an attorney on behalf of and in the name of a client.”143 Proposals to limit this FDCPA amendment were defeated in the House.144

Fair Debt Collection: 3.4.2.3 1996 Amendment

The 1996 amendment reduced the number of times a collector had to provide a debt collection warning from requiring it in all communications to requiring it only in the first one or two communications.145 The 1996 amendment also added the requirement that each communication to the consumer disclose that it is from a debt collector.146

Fair Debt Collection: 3.4.2.4 2006 Amendments

On October 13, 2006, President George W. Bush signed into law four amendments to the FDCPA as part of The Financial Services Regulatory Relief Act of 2006.148 These amendments passed with bipartisan support, despite opposition from consumer groups.

Fair Debt Collection: 3.4.2.5 2010 Amendment

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) creating a new Consumer Financial Protection Bureau (CFPB) was signed into law on July 21, 2010.155 Title X of the Dodd-Frank Act, the Consumer Financial Protection Act, contains the CFPB’s authority.

Fair Debt Collection: 16.2.3.3.8 Other specific entities

Other entities that have been found to be covered by a state’s debt collection law include a for-profit “debt counselor,” 181 a claims recovery service that pursued subrogation claims for a medical benefits plan,182 and a process server that went beyond its messenger role and sought to collect illegal fees for itself.183

Fair Debt Collection: 16.2.3.4 Persons Who Do Not Owe the Debt

Many courts have construed state debt collection statutes to apply to collection acts against a person who does not, in fact, owe the debt,212 such as relatives of the debtor213 and victims of identity theft or mistaken identity.214 Some of these rulings are based on statutory language that includes alleged debts, however, and courts may find these statutes inapplicable to a collector who reaches a non-debtor, but does not claim that the non-debtor

Fair Debt Collection: 16.2.4.1 General Standards

The substantive prohibitions of many state debt collection statutes are modeled on the FDCPA, and interpretations of the FDCPA may be persuasive.216 Many courts apply the FDCPA’s “least sophisticated consumer” standard in interpreting state debt collection statutes.217 In some states, violation of the FDCPA is a per se violation of the state act.218

Fair Debt Collection: 16.2.4.2.2 Credit reporting

Reporting false or disputed information about the debt or the debtor’s creditworthiness to a third party such as a credit bureau may violate the state debt collection statute.226 However, state statutory claims based on conduct that the Fair Credit Reporting Act regulates, including certain actions relating to furnishing of information to credit reporting agencies, may fall within a preemption provision of that Act.227 The analysis of the Act’s preemption provisions is highly technical and is ad

Fair Debt Collection: 16.2.4.2.3 Workplace calls

Employer contacts are prohibited by some state debt collection statutes.229 Many state debt collection statutes also prohibit calls to the debtor at work, usually if the debtor has requested that such calls cease or the collector knows that the employer prohibits such calls.230 Some statutes prohibit calls to the debtor at work unless the collector has tried unsuccessfully to reach the debtor at home.231

Fair Debt Collection: 16.2.4.2.4 Third-party contacts

Contacts with family members and other third parties are considered unfair and abusive under many state debt collection statutes.232 For example, a creditor who discussed the consumers’ debt with relatives while obtaining location information violated a state prohibition against third party contacts except to locate the consumers.233 It may be actionable simply to provide in a contract that the consumer waives the right to be free from third party contacts.2

Fair Debt Collection: 3.4.4.6 Amicus Briefs

The CFPB and the FTC provide interpretations of the FDCPA through amicus briefs, sometimes jointly and sometimes separately. Copies of CFPB and FTC amicus briefs are available as companion materials to the online version of this treatise.

Fair Debt Collection: 3.2.3 Waiver of FDCPA Protections Disfavored

The Ninth Circuit has stated that consumers generally may not waive their rights under the FDCPA:

Out of an abundance of caution, we further note what should be obvious: a consumer’s consent cannot waive protection from the practices the FDCPA seeks to eliminate, such as false, misleading, harassing or abusive communications. Permitting such a waiver would violate the public policy goals pursued by the FDCPA.73

Fair Debt Collection: 3.4.3 Case Developments

Thousands of judicial decisions citing the FDCPA are available using services such as Westlaw161 and LexisNexis. Many of those decisions are summarized in the online FDCPA Case Connector,162 reproduced in Appendix E, infra, and are cited throughout the chapters of this book.