If you are behind on your bills and on the receiving end of
collection phone calls, you will probably hear collectors make some very
threatening statements. While most debt collection professionals try to stay
within the boundaries defined by the Federal Fair Debt Collection Practices Act
(FDCPA), many others cross the line on a regular basis. In 2004, the Federal Trade
Commission (www.ftc.gov) received more than 58,000 complaints about debt
collectors, a figure which represents 17% of the total number of complaints
received all year. Consumers complain about the collection industry more than
most other industries combined.
Collection professionals would probably respond that the
enormous size of the industry and the sheer volume of collection activity
accounts for the large number of complaints. However, only a small percentage
of violations are actually reported by consumers, so the data collected by the
FTC represents only a tiny fraction of the true scope of the problem. Even so,
a pattern of abusive and illegal collection activity has been well documented
by the FTC, and it is getting worse instead of better.
Here are some common threats made by debt collectors:
“We’re going to take your house unless you pay this bill
immediately.” This is a bogus threat. Unless the debt being collected is
secured by the house in question (i.e., a mortgage or home equity loan), the
creditor does not have the power to take your house away from you.
“If you don’t pay this bill today, we’re going to have a
warrant issued for your arrest.” Nonsense. Failure to pay a debt is a civil
matter, not a criminal matter. Threatening a debtor with jail time or accusing
them of committing a crime is totally against the rules.
“We don’t care that you sent a cease communication notice.
We’re going to call you anyway.” The FDCPA gives you the right to terminate
contact efforts by a debt collector. Failure to respect a cease communication
notice is a clear violation of Federal law.
“We’re going to garnish your wages to recover this debt.” A
collector can only threaten action it has the legal authority to take, and the
vast majority of collection agencies have zero legal authority. Your wages can
only be garnished by a creditor after they have won a judgment against you in a
lawsuit.
“We know where you live, so you better pay up.” Yes, threats
of violence still happen in this industry. Nearly 300 complaints against
collectors received by the FTC last year cited the threat of violence as the
cause of the complaint. This is absolutely illegal.
Aside from the usual bogus threats, collectors also use
other tactics that are illegal. For example, discussing your debt with a third
party is a clear violation of the FDCPA. Yet collectors routinely call
neighbors, relatives, and employers to obtain information on debtors. So long
as the collector does not discuss the actual matter of the debt, they still have
their toes on the right side of the line. But as soon as they mention or even
hint that they are calling about a debt, they have crossed the line.
Since many debtors have taken to screening their phone calls
at home to cut down on the relentless barrage, debt collectors frequently call
them at work (when they can obtain the number). In theory, a consumer can get
the collector to stop calling their workplace simply by stating that they are
not allowed to receive personal phone calls at work. That puts the collector on
notice that such activity constitutes interference with the consumer’s
employment, which is not permitted. In practice, however, collectors routinely
ignore this rule and continue to call at work.
There are many other techniques of harassment and
intimidation that cross the line from permissible to impermissible collection
activity. Use of obscene or profane language, shouting, constant and
unrelenting telephone calls, failure to respond to written disputes, and
publication of debtor information all constitute illegal activity as defined by
the FDCPA.
So if you are on the receiving end of illegal collection
actions, what can you do to protect yourself? First and foremost, it’s
important to know and understand your rights as a consumer. A description of
your rights under The Fair Debt Collection Practices Act may be obtained
directly from the FTC (http://www.ftc.gov/bcp/conline/pubs/credit/fdc.htm).
If you believe that a collector has violated your rights in
their attempt to collect from you, then you should not hesitate to file formal
complaints with the Attorney General for your state (www.naag.org) as well as
the Federal Trade Commission. If enough complaints are received about a
particular collector, then these authorities are empowered to bring an
enforcement action against them, which may result in expensive fines that will
make the agency or collector think twice about using such tactics in the future.
You also have the right to bring a lawsuit yourself against a collector that
harasses or abuses you, or otherwise violates your rights under the law.
One final point. The FDCPA technically only applies to
third-party debt collectors, which includes collection agencies and collection
attorneys. It does not apply to the original creditor when collecting their own
debt. For example, if you borrow money from a bank, the bank is not regulated
by the FDCPA. However, numerous other public laws protect consumers from
deceptive or abusive collection practices even by original creditors, and many
states also have laws that parallel the FDCPA but go further and include
original creditors in the definition of debt collector. So if an original
creditor is harassing you or has crossed the line, you should still file a
complaint with your state’s Attorney General as well as the FTC. If a clear
pattern of abuse emerges, the original creditor can be charged with unfair or
deceptive acts or practices, either under state law or under the FTC Act that
governs conduct of commerce in our country.
To sum up, if you are on the receiving end of collection
harassment, don’t just take it. Educate yourself on your rights as a consumer,
vigorously dispute debts that you don’t believe you owe, and take action
yourself in the form of complaints to your Attorney General and the Federal
Trade Commission. By standing up for your rights, you can put a stop to bogus
threats and illegal collection tactics
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