An article appearing in today’s Post Tribune states that four more local residents have filed lawsuits alleging poor tactics from debt collectors. In several recent cases, representatives from the debt collection companies either called or threatened to call employers, neighbors, or family members and disclose that they were owed a debt by the victims. This is in direct violation of the Fair Debt Collection Practices Act and should not be tolerated.

Unfortunately, with the financial issues that many families are having, debt collection is becoming big business. It is one thing to attempt to collect a legitimate debt, but quite another when you violate federal laws to do it. I fully expect that we will see more cases being filed, not only due to increased pressure being put on the borrowers, but also because the borrowers are learning that they do not have to tolerate this type of collection activity.

According to the Fair Debt Collection Practices Act, here are some prohibited actions.

Harassment. Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

• use threats of violence or harm;
• publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
• use obscene or profane language; or
• repeatedly use the phone to annoy someone.

False statements. Debt collectors may not lie when they are trying to collect a debt. For example, they may not:

• falsely claim that they are attorneys or government representatives;
• falsely claim that you have committed a crime;
• falsely represent that they operate or work for a credit reporting company;
• misrepresent the amount you owe;
• indicate that papers they send you are legal forms if they aren’t; or
• indicate that papers they send to you aren’t legal forms if they are.

Debt collectors also are prohibited from saying that:

• you will be arrested if you don’t pay your debt;
• they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or
• legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.

Debt collectors may not:

• give false credit information about you to anyone, including a credit reporting company;
• send you anything that looks like an official document from a court or government agency if it isn’t; or
• use a false company name.

Unfair practices. Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:

• try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
• deposit a post-dated check early;
• take or threaten to take your property unless it can be done legally; or
• contact you by postcard.

Can a debt collector contact anyone else about my debt?

If an attorney is representing you about the debt, the debt collector must contact the attorney, rather than you. If you don’t have an attorney, a collector may contact other people – but only to find out your address, your home phone number, and where you work. Collectors usually are prohibited from contacting third parties more than once. Other than to obtain this location information about you, a debt collector generally is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.

A couple other thoughts for you if you are in this position.

First, check the statute of limitations for your state regarding debt. It is possible that the collection agency is attempting to collect a credit card debt from five years ago for example. In many states, the statute of limitations has expired and the collector may not be able to take you to court to attempt to get a judgment. If this could be the case, I suggest contacting an attorney for guidance.

Next, according to a 2004 PIRG survey, 79% of all credit reports have errors. It is possible that you do not actually owe the debt that is being reported and that the collection agency has wrong information. If this is the case, make them prove it is your debt and you are financially responsible. Our credit restoration attorneys can assist you with that.

Hopefully this has been helpful.

Scott

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