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Fair Debt Collection Practices Act
At CreditCare
Credit Counseling, Inc. we want to provide you with as much information
as possible to help you with your debt consolidation needs. The
following is an excerpt from the Fair Debt Collection Practices
Act. These are laws that protect you from unfair collection
practices. If you are being harassed by creditors this information
will help you understand your rights.
TITLE VIII -
DEBT COLLECTION PRACTICES [Fair Debt Collection Practices
Act]
Sec.
801. Short Title
802. Congressional findings and declaration of purpose
803. Definitions
804. Acquisition of location information
805. Communication in connection with debt collection
806. Harassment or abuse
807. False or misleading representations
808. Unfair practice
809. Validation of debts
810. Multiple debts
811. Legal actions by debt collectors
812. Furnishing certain deceptive forms
813. Civil liability
814. Administrative enforcement
815. Reports to Congress by the Commission
816. Relation to State laws
817. Exemption for State regulation
818. Effective date
§ 801.
Short Title [15 USC 1601 note] This title may be cited as
the "Fair Debt Collection Practices Act."
§ 802.
Congressional findings and declarations of purpose [15 USC
1692]
(a) There
is abundant evidence of the use of abusive, deceptive, and unfair
debt collection practices by many debt collectors. Abusive debt
collection practices contribute to the number of personal bankruptcies,
to marital instability, to the loss of jobs, and to invasions
of individual privacy.
(b) Existing
laws and procedures for redressing these injuries are inadequate
to protect consumers.
(c) Means
other than misrepresentation or other abusive debt collection
practices are available for the effective collection of debts.
(d) Abusive
debt collection practices are carried on to a substantial extent
in interstate commerce and through means and instrumentality's
of such commerce. Even where abusive debt collection practices
are purely intrastate in character, they nevertheless directly
affect interstate commerce.
(e) It is
the purpose of this title to eliminate abusive debt collection
practices by debt collectors, to insure that those debt collectors
who refrain from using abusive debt collection practices are not
competitively disadvantaged, and to promote consistent State action
to protect consumers against debt collection abuses.
§ 803.
Definitions [15 USC 1692a] As used in this title --
(1) The term
"Commission" means the Federal Trade Commission.
(2) The term
"communication" means the conveying of information regarding a
debt directly or indirectly to any person through any medium.
(3) The term
"consumer" means any natural person obligated or allegedly obligated
to pay any debt.
(4) The term
"creditor" means any person who offers or extends credit creating
a debt or to whom a debt is owed, but such term does not include
any person to the extent that he receives an assignment or transfer
of a debt in default solely for the purpose of facilitating collection
of such debt for another.
(5) The term
"debt" means any obligation or alleged obligation of a consumer
to pay money arising out of a transaction in which the money,
property, insurance or services which are the subject of the transaction
are primarily for personal, family, or household purposes, whether
or not such obligation has been reduced to judgment.
(6) The term
"debt collector" means any person who uses any instrumentality
of interstate commerce or the mails in any business the principal
purpose of which is the collection of any debts, or who regularly
collects or attempts to collect, directly or indirectly, debts
owed or due or asserted to be owed or due another. Notwithstanding
the exclusion provided by clause (F) of the last sentence of this
paragraph, the term includes any creditor who, in the process
of collecting his own debts, uses any name other than his own
which would indicate that a third person is collecting or attempting
to collect such debts. For the purpose of section 808(6), such
term also includes any person who uses any instrumentality of
interstate commerce or the mails in any business the principal
purpose of which is the enforcement of security interests.
The term does
not include --
(A) any
officer or employee of a creditor while, in the name of the
creditor, collecting debts for such creditor;
(B) any
person while acting as a debt collector for another person,
both of whom are related by common ownership or affiliated by
corporate control, if the person acting as a debt collector
does so only for persons to whom it is so related or affiliated
and if the principal business of such person is not the collection
of debts;
(C) any
officer or employee of the United States or any State to the
extent that collecting or attempting to collect any debt is
in the performance of his official duties;
(D) any
person while serving or attempting to serve legal process on
any other person in connection with the judicial enforcement
of any debt;
(E) any
nonprofit organization which, at the request of consumers, performs
bona fide consumer credit counseling and assists consumers in
the liquidation of their debts by receiving payments from such
consumers and distributing such amounts to creditors; and
(F) any
person collecting or attempting to collect any debt owed or
due or asserted to be owed or due another to the extent such
activity (i) is incidental to a bona fide fiduciary obligation
or a bona fide escrow arrangement; (ii) concerns a debt which
was originated by such person; (iii) concerns a debt which was
not in default at the time it was obtained by such person; or
(iv) concerns a debt obtained by such person as a secured party
in a commercial credit transaction involving the creditor.
(7) The term
"location information" means a consumer's place of abode and his
telephone number at such place, or his place of employment.
(8) The term
"State" means any State, territory, or possession of the United
States, the District of Columbia, the Commonwealth of Puerto Rico,
or any political subdivision of any of the foregoing.
§ 804.
Acquisition of location information [15 USC 1692b] Any debt
collector communicating with any person other than the consumer
for the purpose of acquiring location information about the consumer
shall --
(1) identify
himself, state that he is confirming or correcting location information
concerning the consumer, and, only if expressly requested, identify
his employer;
(2) not state
that such consumer owes any debt;
(3) not communicate
with any such person more than once unless requested to do so
by such person or unless the debt collector reasonably believes
that the earlier response of such person is erroneous or incomplete
and that such person now has correct or complete location information;
(4) not communicate
by post card;
(5) not use
any language or symbol on any envelope or in the contents of any
communication effected by the mails or telegram that indicates
that the debt collector is in the debt collection business or
that the communication relates to the collection of a debt; and
(6) after
the debt collector knows the consumer is represented by an attorney
with regard to the subject debt and has knowledge of, or can readily
ascertain, such attorney's name and address, not communicate with
any person other than that attorney, unless the attorney fails
to respond within a reasonable period of time to the communication
from the debt collector.
§ 805.
Communication in connection with debt collection [15
USC 1692c]
(a) COMMUNICATION
WITH THE CONSUMER GENERALLY. Without the prior consent of
the consumer given directly to the debt collector or the express
permission of a court of competent jurisdiction, a debt collector
may not communicate with a consumer in connection with the collection
of any debt --
(1) at any
unusual time or place or a time or place known or which should
be known to be inconvenient to the consumer. In the absence
of knowledge of circumstances to the contrary, a debt collector
shall assume that the convenient time for communicating with
a consumer is after 8 o'clock antemeridian and before 9 o'clock
postmeridian, local time at the consumer's location;
(2) if the
debt collector knows the consumer is represented by an attorney
with respect to such debt and has knowledge of, or can readily
ascertain, such attorney's name and address, unless the attorney
fails to respond within a reasonable period of time to a communication
from the debt collector or unless the attorney consents to direct
communication with the consumer; or
(3) at the
consumer's place of employment if the debt collector knows or
has reason to know that the consumer's employer prohibits the
consumer from receiving such communication.
(b) COMMUNICATION
WITH THIRD PARTIES. Except as provided in section 804, without
the prior consent of the consumer given directly to the debt collector,
or the express permission of a court of competent jurisdiction,
or as reasonably necessary to effectuate a post judgement judicial
remedy, a debt collector may not communicate, in connection with
the collection of any debt, with any person other than a consumer,
his attorney, a consumer reporting agency if otherwise permitted
by law, the creditor, the attorney of the creditor, or the attorney
of the debt collector.
(c) CEASING
COMMUNICATION. If a consumer notifies a debt collector in
writing that the consumer refuses to pay a debt or that the consumer
wishes the debt collector to cease further communication with
the consumer, the debt collector shall not communicate further
with the consumer with respect to such debt, except --
(1) to advise
the consumer that the debt collector's further efforts are being
terminated;
(2) to notify
the consumer that the debt collector or creditor may invoke
specified remedies which are ordinarily invoked by such debt
collector or creditor; or
(3) where
applicable, to notify the consumer that the debt collector or
creditor intends to invoke a specified remedy. If such notice
from the consumer is made by mail, notification shall be complete
upon receipt.
(d) For
the purpose of this section, the term "consumer" includes the
consumer's spouse, parent (if the consumer is a minor), guardian,
executor, or administrator.
§ 806.
Harassment or abuse [15 USC 1692d] A debt collector may not
engage in any conduct the natural consequence of which is to harass,
oppress, or abuse any person in connection with the collection of
a debt. Without limiting the general application of the foregoing,
the following conduct is a violation of this section:
(1) The use
or threat of use of violence or other criminal means to harm the
physical person, reputation, or property of any person.
(2) The use
of obscene or profane language or language the natural consequence
of which is to abuse the hearer or reader.
(3) The publication
of a list of consumers who allegedly refuse to pay debts, except
to a consumer reporting agency or to persons meeting the requirements
of section 603(f) or 604(3)1 of this Act.
(4) The advertisement
for sale of any debt to coerce payment of the debt.
(5) Causing
a telephone to ring or engaging any person in telephone conversation
repeatedly or continuously with intent to annoy, abuse, or harass
any person at the called number.
(6) Except
as provided in section 804, the placement of telephone calls without
meaningful disclosure of the caller's identity.
§ 807.
False or misleading representations [15 USC 1962e] A debt
collector may not use any false, deceptive, or misleading representation
or means in connection with the collection of any debt. Without
limiting the general application of the foregoing, the following
conduct is a violation of this section:
(1) The false
representation or implication that the debt collector is vouched
for, bonded by, or affiliated with the United States or any State,
including the use of any badge, uniform, or facsimile thereof.
(2) The false
representation of --
(A) the
character, amount, or legal status of any debt; or
(B) any
services rendered or compensation which may be lawfully received
by any debt collector for the collection of a debt.
(3) The false
representation or implication that any individual is an attorney
or that any communication is from an attorney.
(4) The representation
or implication that nonpayment of any debt will result in the
arrest or imprisonment of any person or the seizure, garnishment,
attachment, or sale of any property or wages of any person unless
such action is lawful and the debt collector or creditor intends
to take such action.
(5) The threat
to take any action that cannot legally be taken or that is not
intended to be taken.
(6) The false
representation or implication that a sale, referral, or other
transfer of any interest in a debt shall cause the consumer to
--
(A) lose
any claim or defense to payment of the debt; or
(B) become
subject to any practice prohibited by this title.
(7) The false
representation or implication that the consumer committed any
crime or other conduct in order to disgrace the consumer.
(8) Communicating
or threatening to communicate to any person credit information
which is known or which should be known to be false, including
the failure to communicate that a disputed debt is disputed.
(9) The use
or distribution of any written communication which simulates or
is falsely represented to be a document authorized, issued, or
approved by any court, official, or agency of the United States
or any State, or which creates a false impression as to its source,
authorization, or approval.
(10) The use
of any false representation or deceptive means to collect or attempt
to collect any debt or to obtain information concerning a consumer.
(11) The failure
to disclose in the initial written communication with the consumer
and, in addition, if the initial communication with the consumer
is oral, in that initial oral communication, that the debt collector
is attempting to collect a debt and that any information obtained
will be used for that purpose, and the failure to disclose in
subsequent communications that the communication is from a debt
collector, except that this paragraph shall not apply to a formal
pleading made in connection with a legal action.
(12) The false
representation or implication that accounts have been turned over
to innocent purchasers for value.
(13) The false
representation or implication that documents are legal process.
(14) The use
of any business, company, or organization name other than the
true name of the debt collector's business, company, or organization.
(15) The false
representation or implication that documents are not legal process
forms or do not require action by the consumer.
(16) The false
representation or implication that a debt collector operates or
is employed by a consumer reporting agency as defined by section
603(f) of this Act.
§ 808.
Unfair practices [15 USC 1692f] A debt collector may not use unfair
or unconscionable means to collect or attempt to collect any debt.
Without limiting the general application of the foregoing, the following
conduct is a violation of this section:
(1) The collection
of any amount (including any interest, fee, charge, or expense
incidental to the principal obligation) unless such amount is
expressly authorized by the agreement creating the debt or permitted
by law.
(2) The acceptance
by a debt collector from any person of a check or other payment
instrument postdated by more than five days unless such person
is notified in writing of the debt collector's intent to deposit
such check or instrument not more than ten nor less than three
business days prior to such deposit.
(3) The solicitation
by a debt collector of any postdated check or other postdated
payment instrument for the purpose of threatening or instituting
criminal prosecution.
(4) Depositing
or threatening to deposit any postdated check or other postdated
payment instrument prior to the date on such check or instrument.
(5) Causing
charges to be made to any person for communications by concealment
of the true propose of the communication. Such charges include,
but are not limited to, collect telephone calls and telegram fees.
(6) Taking
or threatening to take any non judicial action to effect dispossession
or disablement of property if --
(A) there
is no present right to possession of the property claimed as
collateral through an enforceable security interest;
(B) there
is no present intention to take possession of the property;
or
(C) the
property is exempt by law from such dispossession or disablement.
(7) Communicating
with a consumer regarding a debt by post card.
(8) Using
any language or symbol, other than the debt collector's address,
on any envelope when communicating with a consumer by use of
the mails or by telegram, except that a debt collector may use
his business name if such name does not indicate that he is
in the debt collection business.
§ 809.
Validation of debts [15 USC 1692g]
(a) Within
five days after the initial communication with a consumer in connection
with the collection of any debt, a debt collector shall, unless
the following information is contained in the initial communication
or the consumer has paid the debt, send the consumer a written
notice containing
(1) the
amount of the debt;
(2) the
name of the creditor to whom the debt is owed;
(3) a statement
that unless the consumer, within thirty days after receipt of
the notice, disputes the validity of the debt, or any portion
thereof, the debt will be assumed to be valid by the debt collector;
(4) a statement
that if the consumer notifies the debt collector in writing
within the thirty-day period that the debt, or any portion thereof,
is disputed, the debt collector will obtain verification of
the debt or a copy of a judgment against the consumer and a
copy of such verification or judgment will be mailed to the
consumer by the debt collector; and
(5) a statement
that, upon the consumer's written request within the thirty-day
period, the debt collector will provide the consumer with the
name and address of the original creditor, if different from
the current creditor.
(b) If the
consumer notifies the debt collector in writing within the thirty-day
period described in subsection (a) that the debt, or any portion
thereof, is disputed, or that the consumer requests the name and
address of the original creditor, the debt collector shall cease
collection of the debt, or any disputed portion thereof, until
the debt collector obtains verification of the debt or any copy
of a judgment, or the name and address of the original creditor,
and a copy of such verification or judgment, or name and address
of the original creditor, is mailed to the consumer by the debt
collector.
(c) The failure
of a consumer to dispute the validity of a debt under this section
may not be construed by any court as an admission of liability
by the consumer.
§ 810.
Multiple debts [15 USC 1692h] If any consumer owes multiple
debts and makes any single payment to any debt collector with respect
to such debts, such debt collector may not apply such payment to
any debt which is disputed by the consumer and, where applicable,
shall apply such payment in accordance with the consumer's directions.
§ 811.
Legal actions by debt collectors [15 USC 1692i]
(a) Any debt
collector who brings any legal action on a debt against any consumer
shall --
(1) in the
case of an action to enforce an interest in real property securing
the consumer's obligation, bring such action only in a judicial
district or similar legal entity in which such real property
is located; or
(2) in the
case of an action not described in paragraph (1), bring such
action only in the judicial district or similar legal entity
--
(A) in
which such consumer signed the contract sued upon; or
(B) in
which such consumer resides at the commencement of the action.
(C) Nothing
in this title shall be construed to authorize the bringing
of legal actions by debt collectors.
§ 812.
Furnishing certain deceptive forms [15 USC 1692j]
(a) It is
unlawful to design, compile, and furnish any form knowing that
such form would be used to create the false belief in a consumer
that a person other than the creditor of such consumer is participating
in the collection of or in an attempt to collect a debt such consumer
allegedly owes such creditor, when in fact such person is not
so participating.
(b) Any person
who violates this section shall be liable to the same extent and
in the same manner as a debt collector is liable under section
813 for failure to comply with a provision of this title.
§ 813.
Civil liability [15 USC 1692k]
(a) Except
as otherwise provided by this section, any debt collector who
fails to comply with any provision of this title with respect
to any person is liable to such person in an amount equal to the
sum of
(1) any
actual damage sustained by such person as a result of such failure;
(2) (A)
in the case of any action by an individual, such additional
damages as the court may allow, but not exceeding $1,000; or
(B) in the
case of a class action, (i) such amount for each named plaintiff
as could be recovered under subparagraph (A), and (ii) such
amount as the court may allow for all other class members, without
regard to a minimum individual recovery, not to exceed the lesser
of $500,000 or 1 per centum of the net worth of the debt collector;
and
(3) in the
case of any successful action to enforce the foregoing liability,
the costs of the action, together with a reasonable attorney's
fee as determined by the court. On a finding by the court that
an action under this section was brought in bad faith and for
the purpose of harassment, the court may award to the defendant
attorney's fees reasonable in relation to the work expended
and costs.
(b) In determining
the amount of liability in any action under subsection (a), the
court shall consider, among other relevant factors --
(1) in any
individual action under subsection (a)(2)(A), the frequency
and persistence of noncompliance by the debt collector, the
nature of such noncompliance, and the extent to which such noncompliance
was intentional; or
(2) in any
class action under subsection (a)(2)(B), the frequency and persistence
of noncompliance by the debt collector, the nature of such noncompliance,
the resources of the debt collector, the number of persons adversely
affected, and the extent to which the debt collector's noncompliance
was intentional.
(c) A debt
collector may not be held liable in any action brought under this
title if the debt collector shows by a preponderance of evidence
that the violation was not intentional and resulted from a bona
fide error notwithstanding the maintenance of procedures reasonably
adapted to avoid any such error.
(d) An action
to enforce any liability created by this title may be brought
in any appropriate United States district court without regard
to the amount in controversy, or in any other court of competent
jurisdiction, within one year from the date on which the violation
occurs.
(e) No provision
of this section imposing any liability shall apply to any act
done or omitted in good faith in conformity with any advisory
opinion of the Commission, notwithstanding that after such act
or omission has occurred, such opinion is amended, rescinded,
or determined by judicial or other authority to be invalid for
any reason.
§ 814.
Administrative enforcement [15 USC 1692l]
(a) Compliance
with this title shall be enforced by the Commission, except to
the extend that enforcement of the requirements imposed under
this title is specifically committed to another agency under subsection
(b). For purpose of the exercise by the Commission of its functions
and powers under the Federal Trade Commission Act, a violation
of this title shall be deemed an unfair or deceptive act or practice
in violation of that Act. All of the functions and powers of the
Commission under the Federal Trade Commission Act are available
to the Commission to enforce compliance by any person with this
title, irrespective of whether that person is engaged in commerce
or meets any other jurisdictional tests in the Federal Trade Commission
Act, including the power to enforce the provisions of this title
in the same manner as if the violation had been a violation of
a Federal Trade Commission trade regulation rule.
(b) Compliance
with any requirements imposed under this title shall be enforced
under --
(1) section
8 of the Federal Deposit Insurance Act, in the case of
(A) national
banks, by the Comptroller of the Currency;
(B) member
banks of the Federal Reserve System (other than national banks),
by the Federal Reserve Board; and
(C) banks
the deposits or accounts of which are insured by the Federal
Deposit Insurance Corporation (other than members of the Federal
Reserve System), by the Board of Directors of the Federal
Deposit Insurance Corporation;
(2) section
5(d) of the Home Owners Loan Act of 1933, section 407 of the
National Housing Act, and sections 6(i) and 17 of the Federal
Home Loan Bank Act, by the Federal Home Loan Bank Board (acting
directing or through the Federal Savings and Loan Insurance
Corporation), in the case of any institution subject to any
of those provisions;
(3) the
Federal Credit Union Act, by the Administrator of the National
Credit Union Administration with respect to any Federal credit
union;
(4) subtitle
IV of Title 49, by the Interstate Commerce Commission with respect
to any common carrier subject to such subtitle;
(5) the
Federal Aviation Act of 1958, by the Secretary of Transportation
with respect to any air carrier or any foreign air carrier subject
to that Act; and
(6) the
Packers and Stockyards Act, 1921 (except as provided in section
406 of that Act), by the Secretary of Agriculture with respect
to any activities subject to that Act. (c) For the purpose of
the exercise by any agency referred to in subsection (b) of
its powers under any Act referred to in that subsection, a violation
of any requirement imposed under this title shall be deemed
to be a violation of a requirement imposed under that Act. In
addition to its powers under any provision of law specifically
referred to in subsection (b), each of the agencies referred
to in that subsection may exercise, for the purpose of enforcing
compliance with any requirement imposed under this title any
other authority conferred on it by law, except as provided in
subsection (d) Neither the Commission nor any other agency referred
to in subsection (b) may promulgate trade regulation rules or
other regulations with respect to the collection of debts by
debt collectors as defined in this title.
§ 815.
Reports to Congress by the Commission [15 USC 1692m]
(a) Not later
than one year after the effective date of this title and at one-year
intervals thereafter, the Commission shall make reports to the
Congress concerning the administration of its functions under
this title, including such recommendations as the Commission deems
necessary or appropriate. In addition, each report of the Commission
shall include its assessment of the extent to which compliance
with this title is being achieved and a summary of the enforcement
actions taken by the Commission under section 814 of this title.
(b) In the
exercise of its functions under this title, the Commission may
obtain upon request the views of any other Federal agency which
exercises enforcement functions under section 814 of this title.
§ 816.
Relation to State laws [15 USC 1692n] This title does not
annul, alter, or affect, or exempt any person subject to the provisions
of this title from complying with the laws of any State with respect
to debt collection practices, except to the extent that those laws
are inconsistent with any provision of this title, and then only
to the extent of the inconsistency. For purposes of this section,
a State law is not inconsistent with this title if the protection
such law affords any consumer is greater than the protection provided
by this title.
§ 817.
Exemption for State regulation [15 USC 1692o] The Commission
shall by regulation exempt from the requirements of this title any
class of debt collection practices within any State if the Commission
determines that under the law of that State that class of debt collection
practices is subject to requirements substantially similar to those
imposed by this title, and that there is adequate provision for
enforcement.
§ 818.
Effective date [15 USC 1692 note]
This title takes
effect upon the expiration of six months after the date of its enactment,
but section 809 shall apply only with respect to debts for which
the initial attempt to collect occurs after such effective date.
Approved September
20, 1977
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