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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)

Caution Flag

Another Reason For Collectors To Be Cautious When Calling Consumer Cell Phones

Given the data that must be weighed by a creditor or debt collector in determining where a consumer resides – the area code of the number called, the zip code of the residence of record, any statements by the consumer about his or her place of residence – it is certain that the Discover Consent Order will be the start of yet another flood of consumer lawsuits against the collection industry regarding the calling of consumer cell phones.

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Eleventh Circuit’s Mistaken Interpretation Likely to Expose Attorneys to Increased FDCPA Liability

The Eleventh Circuit Court of Appeals recently handed down a decision that went too far in holding that all litigation related activity is subject to the FDCPA. In pursuing their client’s judgment, an attorney and law firm obtained a garnishment against Nedzad Miljkovic. Miljkovic filed a claim for exemption in response, which the creditor disputed. However, the writ was eventually dissolved on the creditor’s attorney’s motion after Miljkovic provided discovery showing that his wages were exempt from garnishment.

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2nd CFPB Enforcement Action This Week Involving Debt Collection, Now Against Discover Bank

On the heels of yesterday’s enforcement action against Citibank and its subsidiary Department Stores National Bank, today the CFPB took action against Discover Bank and its affiliates for illegal private student loan servicing practices. The company also engaged in illegal debt collection tactics, including calling consumers early in the morning and late at night.

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Federal Court Paves Way For CFPB To Pursue Enforcement Action Against Hanna

[Editor’s note: Yesterday insideARM reported that the judge in the case of CFPB v. Hanna issued an order denying the defendant’s motion to dismiss. The order, released yesterday, is 70 pages. Today, as promised, we begin to provide analysis of that order. This is one of two articles – by two different attorneys – offering their view. […]