In a split decision, the First Circuit Court of Appeals last week upheld a lower court ruling that a collection letter send by a law firm violated the FDCPA because it gave the impression that the consumer could not dispute the debt and that payment was the only option to avoid litigation.
Debt collection law firm Frederick J. Hanna & Associates filed a motion Friday to dismiss an enforcement action initiated by the Consumer Financial Protection Bureau. The CFPB’s lawsuit accused the firm of filing too many collection lawsuits, which it said was a violation of the FDCPA.
A collection agency that late last month lost an appeal in the Third Circuit has filed a petition for a rehearing, according to ACA International. The case involved an account number being visible through the clear window of an envelope.
At a collection conference in Las Vegas, regulators shared some insight into how they view out-of-statute debt. They called for fuller disclosures to consumers, both on legal action (agencies can’t take any) and responsibility to pay (the consumer, in an out-of-stat-debt situation, has none). Will the insight make it into the Policies and Procedures of collection agencies, though?
U.S. Representative Maxine Waters (D-Calif.) will propose a bill Wednesday that changes many key provisions of the Fair Credit Reporting Act (FCRA) including a reduction in the time negative information can stay on credit reports and the removal of accounts in collection once paid off.
Last fall, Bank of America entered into a $32 million settlement to resolve a TCPA lawsuit over debt collection calls the bank made within its credit card and mortgage units. It has been called the largest TCPA settlement ever. Late last month, the judge in the case drastically lowered the amount of money the plaintiffs’ attorneys will see for their work in the final settlement approval.
The number of debt collection complaints in the CFPB’s consumer complaints database claiming that debt collectors are chasing incorrect debt increased in July compared to the previous month and quarter. Interestingly, there has been a sharp rise in consumers claiming that the debt in question has already been paid.
The Fourth Circuit Court of Appeals recently upheld a lower court ruling that found a debt collection agency in violation of the FDCPA for continuing to call a debtor after the bill had been paid to the original creditor. The agency argued that it never received a dispute in writing after the debt was paid.
Auto loans have long been an interesting market for the accounts receivable management industry. While total outstanding balances have always been quite high, historically in line with credit cards for example, the secured nature of the loans limit the work collection agencies could do for lenders. Is that paradigm about to change?
The National Consumer Law Center (NCLC) late Tuesday published a report that calls for the Department of Education to stop using private collection agencies to help recover delinquent student loans. But the report is misleading and inflammatory, going far beyond more reasoned studies from government agencies urging reform within the ED collection contract.