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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)

CFPB

CFPB Issues Seventh Monthly Complaint Report; Highlights Include Complaints on Debt Settlement and Credit Repair Companies

The Consumer Financial Protection Bureau (CFPB) released its latest monthly consumer complaint report on consumer complaints in December about financial services. The report highlights that complaints on debt collection were still the largest volume of complaints in December, 6410 of the 20,300 or (31%) of the total complaints. Debt collection, mortgage, and credit reporting complaints […]

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Judge Denies Class Action Certification in FDCPA Spanish Letter Case Against Portfolio Recovery Associates, LLC

Yesterday, a Federal Judge in Virginia denied a motion to certify a class action case against an arm of publicly traded debt buyer PRA Group (PRAA). The lawsuit was originally filed exactly one year earlier, on January 28, 2015. The case illustrates the challenges of attempting to be FDCPA compliant when dealing with consumers that do not speak English or for whom English is a second language.

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2nd Circuit Rules Bankruptcy Code Does Not Preclude FDCPA Suit in District Court

In Garfield v. Ocwen Loan Servicing, LLC, the Second Circuit Court of Appeals examined whether a debtor who has been discharged in a bankruptcy can sue in a district court under the FDCPA,as opposed to seeking relief in the bankruptcy court. The Court held that the Bankruptcy Code provision governing the discharge injunction, “does not explicitly create a cause of action for its violation, whereas the automatic stay provision provides such a remedy…”

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Bankruptcy Code Precludes FDCPA Claim for Filing POC on Time-Barred Debt, Fla. District Court Holds

The U.S. District Court for the Middle District of Florida recently dismissed allegations that a debt buyer violated the federal Fair Debt Collection Practices Act by filing a proof of claim on time-barred debt, holding that such claims are precluded by the Bankruptcy Code, and that the FDCPA does not provide a private right of action against debt collectors who file time-barred proofs of claim in bankruptcy court.

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Class Certification Rejected in Alleged FDCPA/RICO Suit Against Sherman Financial Group

A federal judge in Indianapolis has ruled that a lawsuit alleging violations of the FDCPA and the United States Racketeer Influence and Corrupt Organization Act (“RICO”) against Sherman Financial Group, one of the country’s largest debt buyers, cannot proceed as a class action because circumstances vary too much among the class members. Assuming this decision withstands any subsequent appeal it appears that Sherman made a good decision to vigorously defend the case.