Fair Debt Collection Practices Act
The Fair Debt Collection Practices Act, or FDCPA, was enacted in 1977. Congress has amended the act several times since, with the most recent amendment in 2006. The FDCPA was enacted to curb abuse, deception and unfair practices used by debt collectors in pursuit of payment. Congress believed that the unfair practices contributed to bankruptcies, invasions of individual privacy, marital problems and job loss. The act was designed to remedy these problems.
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Locating Information
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The FDCPA covers the practices of the debt collection industry from the time the debt is assumed until it's collected. In attempting to determine your location, the debt collector can't reveal he's collecting a debt when contacting others about you; send postcards or letters with his company name on the outside; or continue to communicate with you once you've retained an attorney and the collector is notified.
Collection Practices
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The debt collector can't contact you after 9 p.m., can't contact you at work if your employer prohibits such calls, and must speak with your attorney regarding collection issues such as ownership of the debt once he knows you've retained an attorney. The debt collector can't communicate with others about your debt, such as friends or family. Written notification to the debt collector that you won't pay the debt precludes the debt collector from further communication with you.
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Harassment and Misrepresentation
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The debt collector cannot speak to you using abusive language, threaten you with violence, publicly publish your name in a debtor list, advertise your debt for sale, continuously call simply to harass you, or call without identifying himself as a debt collector. He also cannot misrepresent himself as a representative of a government agency. Debt collectors cannot threaten a remedy for which there is no legal basis, such as imprisonment, and they cannot communicate information they know to be false, such as denying that a debt is in dispute.
Unfair Practices
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Debt collectors are not allowed to collect any amount other than the principal, unless allowed by law. They cannot accept postdated checks and deposit them early or threaten to deposit them early, nor can they cause you to incur charges for their collection efforts, such as calling you collect. They cannot threaten any legal action that they are not fully prepared to undertake.
Miscellaneous Practices and Penalties
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If you have multiple debts with the same collector, he cannot apply any payment you make to a debt other than the one to which you direct the payment. If legal action is taken that involves a debt secured by property, it can only take place in the jurisdiction in which the property is located or in which you reside at the onset of the legal action.
If the debt collector violates the FDCPA, you are entitled to a sum equal to actual damages you suffered, and if you sue as an individual, the court can allow additional damages not to exceed $1,000. In a class-action suit, named plaintiffs can receive at least $1,000 and actual damages, and other plaintiffs can share, at maximum, the lesser of $500,000 or 1 percent of the debt collector's net worth.
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