New Jersey Looks to Pass a State FDCPA Law

An ARM industry trade group is monitoring lawmakers in the Garden State as they consider a new law that closely mirrors the federal Fair Debt Collection Practices Act but with a few new wrinkles specific to companies operating in the state. Fines for violations would greatly increase under the proposed bill.

The bill, A 2493, was introduced in the New Jersey General Assembly last month and now sits in the Consumer Affairs Committee. It would create what the bill calls a New Jersey Fair Debt Collection Practices Act that closely adheres to the current FDCPA.

A provision in the bill calls for violations of the New Jersey FDCPA to be considered violations of the state’s Consumer Fraud Act. Violations of the fraud act carry a $10,000 penalty for the first offense and $20,000 for offenses thereafter. The FDCPA calls for base fines of $1,000 for violations.

Account receivables management trade group ACA International told The Star-Ledger that the clause may be going too far. "To make the leap that any violation of a debt collection law is consumer fraud is too aggressive," Rozanne Andersen, ACA’s general counsel told the paper.

The bill also stipulates that any violation of the FDCPA is a violation of the new law, ostensibly meaning fines for FDCPA violations in New Jersey would carry $10,000 fines rather than the current $1,000 fine.

The proposed bill also includes most of the provisions of the federal FDCPA, including prohibitions against debt collectors contacting consumers before 8am or after 9pm, disclosing the debtor’s private information to third parties and limitations on contacting consumers at work.