By borrowing money, consumers do not give creditors permission to use whatever means necessary to recover the debt.  Regardless of the circumstances, creditors are required to treat debtors with respect.  This means that creditors are strictly prohibited from any form of harassment or abuse.  The Fair Debt Collection Practices Act (the “Act”) is designed to protect consumers from such treatment.  But consumers who do not know the Act exists, or who do not understand how the Act operates, may be unable to benefit from its protections.

A congressional study on debt collection practices revealed that abusive and deceptive practices are highly prevalent among debt collectors.  These practices are believed to play a role in many of the issues troubling Americans today, including marital discord, bankruptcy and unemployment.  From these findings, the Fair Debt Collection Practices Act was born.  The Act seeks to protect consumers in very specific ways and provides remedies for consumers who have been mistreated by creditors.

Are creditors restricted in how they can acquire information about a consumer?
The first step debt collectors generally take in the debt collection process is to seek out the whereabouts of a consumer.  While trying to locate a consumer, creditors must be careful not to reveal personal information about the consumer.  The Act lays out specific guidelines to protect against this:

• The creditor is required to identify himself but not his employer unless specifically requested to do so.
• The creditor must not disclose that the consumer owes any debt.
• The creditor must not communicate with any one person more than once unless that person specifically requests a return phone call or unless the creditor reasonably believes that person’s initial response was false or incomplete.
• The creditor must not send mail via post card or in an envelope that discloses the nature of the communication.
• The creditor is permitted to speak only with the consumer’s attorney if the consumer has legal representation.

Are creditors restricted in how they can communicate with a consumer?
In general terms, creditors must treat consumers with dignity and respect.  Prior to the Act’s passage, however, creditors had too much flexibility in this regard.  The Act specifies precisely how creditors can and cannot communicate with consumers:

• Creditors cannot communicate with consumers at any unusual time or place, including between the hours of 9:00 p.m. and 8:00 a.m.
• Creditors must communicate with consumers through the consumer’s attorney if the consumer has legal counsel.
• Creditors cannot contact consumers at the consumer’s place of employment.
• Creditors can only speak with the consumer, his or her attorney, and credit reporting agencies about the debt.
• Creditors must cease communication except for limited purposes if the consumer provides a written refusal to pay the debt.

What specific protections does the Act provide against harassment and abuse?
The Act uses strong language to ensure that creditors do not harass, abuse or oppress consumers.  Creditors who ignore this language and violate the Act are subject to fines and penalties.  In addition to prohibiting general abuse, the Act provides consumers with the following specific protections:

• Creditors must not use or threaten to use violent or criminal means to collect a debt.
• Creditors must not use obscene language intended to be abusive.
• Creditors cannot allow a telephone to ring continuously with the intent to annoy or abuse.
• Creditors are generally required to disclose their identity.

Does the Act require debt collectors to be entirely honest and straightforward in their dealings with consumers?
An entire section of the Act is devoted to ensuring creditors are honest in their dealings with consumers.  Collectors are not permitted to make any false or misleading statements while collecting a debt.  Prohibited conduct includes, but is not limited to:

• Falsely implying that the collector is in any way affiliated with the government.
• Misrepresenting the nature or amount of the debt.
• Falsely implying that the collector is an attorney.
• Misrepresenting that failure to pay a debt will result in arrest or other unlawful action.
• Misrepresenting that the consumer may lose any defense to payment if the debt is not paid immediately.
• Communicating false information about the debt to third parties.
• Using deception to acquire information about a consumer.
• Using names of any organizations other than the collector’s true name.

Are creditors required to provide written notification of a debt?
Creditors must provide consumers with a written notice of the debt, known as a validation.  If the initial communication with the consumer was not in writing and did not satisfy the requirements of the Act, the validation must be sent within five days of contacting the consumer.  If initial contact was made in writing it may fulfill the validation requirement if it contains adequate information about the debt.

A validation of debt must provide the creditor’s name and the amount of the debt.  More importantly, it must state that the consumer has 30 days to dispute the debt.  Collectors can assume the debt is valid if a consumer does not respond within the 30-day window.  On the other hand, consumers who dispute the debt in writing effectively cause collections to be ceased until their creditor provides proof of the debt.  For this reason it is critically important for consumers to respond to debt validations in a timely fashion.

What does the Act say about owing multiple debts to one creditor?
Many times debt collectors act on behalf of more than one creditor in the collection process.  Consumers who are confronted with one of these collectors may dispute any portion of the debt without disputing the entire debt.  In such a situation, collectors are prohibited from applying payments to any portion of debt which the consumer disputes.  Moreover, collectors are required to apply payments as directed by consumers.  Collectors who do not act in accordance with consumer’s directions may be subject to fines and penalties under the Act.

What remedies are available to consumers whose collectors violate the Act?
The first step in holding a debt collector accountable is recognizing that the collector violated the Act.  Consumers then have one year from the perceived violation to bring action against a collector in a court of law.  Collectors whose conduct violated the Act are subject to civil liability.  They can be liable to consumers for actual damages and attorney fees, as well as civil fines of up to $1,000.  Collectors need to be discouraged from engaging in abusive conduct and sometimes bringing legal action against them is the best means of achieving this end.

How should I proceed if a debt collector has abused me?
The Act provides many safeguards but only consumers who actively invoke its protections are shielded against abusive creditors.  Consumers must first understand that they have a right to dispute any debt they do not agree with.  To preserve your protections under the Act, you must send a written dispute to creditors within 30 days of receiving a validation of debt.  Once you have disputed the debt, it is important to keep good records of all communication with collectors.  This includes written correspondence as well as voice mails and messages.  This information will assist your attorney recover damages when the time comes.