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Fair Debt Collection: Scope of the act

This bill applies only to debts contracted by consumers for personal, family, or household purposes; it has no application to the collection of commercial accounts.

Fair Debt Collection: Obtaining location information

While this legislation strongly protects the consumer’s right to privacy by prohibiting a debt collector from communicating the consumer’s personal affairs to third persons, the committee also recognizes the debt collector’s legitimate need to seek the whereabouts of missing debtors. Accordingly, this bill permits debt collectors to contact third persons for the purpose of obtaining the consumer’s location.

Fair Debt Collection: Prohibited practices

This legislation expressly prohibits a host of harassing, deceptive, and unfair debt collection practices. These include: threats of violence; obscene language; the publishing of “shame lists;” harassing or anonymous telephone calls; impersonating a government official or attorney; misrepresenting the consumer’s legal rights; simulating court process; obtaining information under false pretenses; collecting more than is legally owing; and misusing postdated checks.

Fair Debt Collection: Validation of debts

Another significant feature of this legislation is its provision requiring the validation of debts. After initially contacting a consumer, a debt collector must send him or her written notice stating the name of the creditor and the amount owed. If the consumer disputes the validity of the debt within 30 days, the debt collector must cease collection until he sends the consumer verification.

Fair Debt Collection: Legal actions by debt collectors

This legislation also addresses the problem of “forum abuse,” an unfair practice in which debt collectors file suit against consumers in courts which are so distant or inconvenient that consumers are unable to appear. As a result, the debt collector obtains a default judgment and the consumer is denied his day in court.

Fair Debt Collection: Furnishing deceptive forms

Another common collection abuse is known colloquially as “flatrating.” A “flat-rater” is one who sells to creditors a set of dunning letters bearing the letter-head of the flat-rater’s collection agency and exhorting the debtor to pay the creditor at once. The creditor sends these letters to his debtors, giving the impression that a third party debt collector is collecting the debt. In fact, however, the flat-rater is not in the business of debt collection, but merely sells dunning letters.

Unfair and Deceptive Acts and Practices: Ala. Code §§ 8-19-1 through 8-19-15 Deceptive Trade Practices Act

Prohibited Practices: 27 enumerated practices, plus a catchall provision prohibiting other unconscionable or deceptive practices.

Scope: “Trade or commerce” includes advertising, buying, offering for sale, sale or distribution, or performance of any service, goods, article, commodity, or other thing of value. Goods include real estate, intangibles, and franchises. Leases and consignments are included. Private cause of action is limited to consumers, except for certain violations involving pyramid sales and seller-assisted marketing plans.

Unfair and Deceptive Acts and Practices: Ariz. Rev. Stat. Ann. §§ 44-1521 through 44-1534 Consumer Fraud Act

Prohibited Practices: Deception, omission of material fact with intent that others rely on it.

Scope: Sale, offer for sale, advertisement, or lease of goods, intangibles, real estate or services.

Exclusions: Advertisements of publisher, radio or television media without knowledge; advertising complying with FTC regulations.

Private Remedies: None specified. (Courts imply private right of action.)

Limitations: None specified.

Unfair and Deceptive Acts and Practices: Cal. Civ. Code §§ 1750 through 1785 (West) Consumers Legal Remedies Act

Prohibited Practices: 27 enumerated unfair practices and unfair or deceptive practices.

Scope: Transactions that are intended to result or which result in sale or lease of goods or services to any consumer.

Exclusions: Construction and/or sale of entire residence or all or part of commercial or industrial structure; sales of realty, including site preparation; dissemination of advertisements by any advertising medium with no knowledge of falsity; non-consumer transactions.

Unfair and Deceptive Acts and Practices: Colo. Rev. Stat. §§ 6-1-101 through 6-1-116 Consumer Protection Act

Prohibited Practices: Numerous enumerated deceptive practices, plus separate sections on specific industries. Catchall prohibition of knowingly or recklessly engaging in any unfair, unconscionable, deceptive, deliberately misleading, false, or fraudulent act or practice.

Scope: Practices in course of a person’s business, vocation or occupation. The term “property,” used in many substantive prohibitions, is broadly defined to include real property, personal property, intangible property, or services.

Unfair and Deceptive Acts and Practices: Conn. Gen. Stat. §§ 42-110a through 42-110q Connecticut Unfair Trade Practices Act

Prohibited Practices: Unfair methods of competition and unfair or deceptive acts or practices.

Scope: Trade or commerce means the advertising, sale, lease, offer for sale or lease, or distribution of any services or property, real, personal or intangible, or anything else of value.

Exclusions: Transactions or actions permitted under law as administered by board or officer of state or U.S.; advertisements by publisher, radio and television media, with no knowledge of falsity, and with no direct financial interest in the sale of the product.

Unfair and Deceptive Acts and Practices: D.C. Code §§ 28-3901 through 28-3913

Prohibited Practices: 35 enumerated deceptive, unfair or unlawful trade practices, including unconscionable terms.

Scope: Private cause of action must relate to trade practice, defined as any act which does or would create, alter, repair, furnish, make available, provide information about, or, directly or indirectly, solicit or offer for or effectuate a sale, lease, or transfer of consumer goods or services.

Unfair and Deceptive Acts and Practices: Fla. Stat. §§ 501.201 through 501.213 Deceptive and Unfair Trade Practices Act

Prohibited Practices: Unfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices. Violations may be based on violation of FTC rules, FTC standards of unfairness and deception, or any statute, rule, regulation or ordinance proscribing unfair, deceptive, or unconscionable practices. Special restrictions on motor vehicle sales, added in 2001, are found at Fla. Stat. §§ 501.975 to 501.976 and are explicitly made actionable.

Unfair and Deceptive Acts and Practices: Ga. Code Ann. §§ 10-1-370 through 10-1-375 Uniform Deceptive Trade Practices Act

Prohibited Practices: 12 enumerated deceptive practices and conduct likely to create confusion or misunderstanding.

Scope: Action in course of business, vocation or occupation.

Exclusions: Conduct which complies with federal, state or local rules, orders, or statutes; publishers, broadcasters, printers or other persons who disseminate information without knowledge of deceptive character.

Unfair and Deceptive Acts and Practices: 5 Guam Code Ann. §§ 32101 through 32603 Deceptive Trade Practices—Consumer Protection Act

Prohibited Practices: False, misleading or deceptive trade practices, including 50 enumerated practices. Additional provisions regarding vehicle warranties, telemarketing, prizes and gifts, homeowners’ warranties, and cable television.

Scope: Very broad. Protects business consumers (including corporations and the government) as well as individuals purchasing goods or services for personal use.

Unfair and Deceptive Acts and Practices: Haw. Rev. Stat. §§ 480-1 through 480-24

Prohibited Practices: Unfair methods of competition and unfair or deceptive trade practices; antitrust violations.

Scope: Trade or commerce. Private action extended to consumer, defined to be natural person who primarily for personal, family or household purposes attempts to purchase, purchases, or is solicited to purchase goods or services or who commits money, property, or services in a personal investment. “Purchase” includes leasing and licensing. (Business entities can bring suit only for violation of prohibition of unfair competition.)

Unfair and Deceptive Acts and Practices: 815 Ill. Comp. Stat. 505/1 through 505/12 Consumer Fraud and Deceptive Business Practices Act

Prohibited Practices: Unfair methods of competition and unfair or deceptive acts or practices including concealment or omission of any material fact with intent to cause reliance, including many enumerated prohibitions; violation of UDTPA.

Scope: Trade or commerce, defined as advertising, sale, offering for sale, or distribution of any real, personal or intangible property or services, and any other thing of value.