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FDCPA

The Fair Debt Collection Practices Act (FDCPA) was enacted in 1977 to protect consumers from abusive, unfair, and deceptive practices by third-party debt collectors. The law details when and how a collector may contact a debtor. The government enforcer of the law has historically been the Federal Trade Commission (FTC), but some regulatory duties may be shared with the Bureau of Consumer Financial Protection housed within the Federal Reserve, created in 2010.

The FDCPA is a strict civil liability law, which means that a consumer need not prove actual damages in order to claim statutory damages of up to $1,000 per violation plus reasonable attorney fees.

It is commonly believed that the FDCPA will be amended and/or updated in the 112th Congress (2011-2012).

The complete Fair Debt Collection Practices Act (PDF, 326 KB)

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Washington Lawsuit Scrutinizes Use of Prosecutor’s Seal on Debt Collection Letters

A federal class action lawsuit in Seattle alleges that a collection agency used the King County prosecutor’s seals on debt collection letters to consumers, while failing to disclose that the letter was from a collection agency and not a law enforcement office. The plaintiffs say they received seemingly official letters from Missouri-based collection agency Bounceback which included threats of jail time if consumers didn’t pay the amount of the debt and more than $180 in fees. Bounceback was able to use the county prosecutor’s seal on these collection letters because it participates in a “check enforcement program,” where county prosecutors rent out the prosecutor’s seal and letterhead in exchange for a cut of the collection fees.

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UPDATE: NY Debt Collector’s Operations Shuttered After Joint FTC, NY AG Complaint

The U.S. District Court for the Western District of New York issued a temporary restraining order and asset freeze against a Buffalo, NY-based debt collection operation Monday, after the Federal Trade Commission and New York Attorney General’s Office filed a joint complaint alleging the operation used lies and threats against consumers in violation of federal and state laws.

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CFPB Takes Direct Aim at Policing Legal Profession

On July 14, 2014, the Consumer Financial Protection Bureau (“CFPB”), a Federal regulatory body created by the Dodd Frank Act of 2010 mounted a frontal attack on this bedrock of separation of powers principle by filing suit in the United States District Court against a prominent consumer collection law firm, Frederick J. Hanna and Associates, P.C. of Atlanta Georgia.