When Debt Collectors Attack: How Are You Protected by Federal Law?

The FDCPA is the Fair Debt Collection Practices Act. Enacted in 1977, it’s the Federal law that protects consumers from abusive collection practices from third-party debt collectors. There are also many states that have similar protective statutes. For example, those of you who live in California enjoy the FDCPA protections, as well as those afforded to you by the Rosenthal Act.
Here are your rights under the Federal act.

Communication Must Occur at Convenient Hours

Collectors may not contact debtors before 8am or after 9pm local time, based on where the consumer is located. That means no calls at 8am Eastern Time to a debtor living in Texas and no calls at 10pm Eastern Time from a collector working in California.

Calls Cannot be Made to the Debtor’s Workplace

There is an exception to this rule. If you give the collector permission to contact you at work or if communicating with the debtor at work isn’t disallowed by their employer, then, in general, it’s allowed. If you tell the collector that you are not allowed to receive calls at work or if you could get in trouble because of their calls, then they must stop.

Disclosure to Third Parties is Not Allowed

In general, the collector is not allowed to communicate with anyone other than the debtor regarding the debt. In other words, the collector can’t call your neighbors and tell them that you owe $5,000 in past due credit card charges.

They Must Stop if You Ask Them

Despite beliefs to the contrary, consumers can actually demand that the collector stop communicating with them. This must be done in writing, not verbally. So, you can’t just tell them “I demand that you stop calling me.”
There are two exceptions to this rule. The collector may contact the debtor after they’ve received a valid written demand to cease communications to let them know that the collector is not attempting to collect the debt any longer. And, they may also notify the debtor that they attempt other methods normally used by collectors to collect debt. Read between the lines…this means a potential lawsuit from a collection attorney.
 No Abusive Behavior
 This is clearly not allowed. They are also not allowed to threaten violence, use profanity or insensitive remarks, publish your name as someone who won’t pay their bills (credit reporting is an exception), or call you over and over in an abusive manner.

They Must Disclose Who They Are

If you’ve ever received a call from a debt collector it was probably prefaced with “I’m calling from XYZ and the purpose of this call is to collect a debt.” And, if you’ve ever received a letter from a collection agency it probably had language that disclosed that the communication was from a debt collector and that any information they receive may be used in furtherance of collecting a debt. These are required disclosures. They can’t sneak up on you.

No Misrepresentations

What gets a collector in hot water very quickly is any act of dishonesty. Collectors are not allowed to:
1. Imply that they are with a governmental organization
2. Misrepresent that the balance of the debt
3. Pretend to be an attorney
4. Imply that non-payment will result in garnishment unless the collector intends to pursue garnishment
5. Threaten legal action if none is intended
6. Imply that not paying debt is a criminal offense

Must Show the Debt As In Dispute, If So

This is an obligation under the Fair Credit Reporting Act (FCRA). If the debtor challenges the validity of the collection the collection agency must show the account as being in dispute not only within their own records but also along with the account as reported to your credit files.

Debt collectors can be relentless

They'll awaken a consumer in the morning. They'll call his cell phone if they have it during the day. They'll interrupt dinner. In fact, when it comes to raising a ruckus and just becoming a general overall nuisance, third-party collection agencies make plain old telemarketers look like amateurs.

Fortunately, a federal law reigns them in, and consumers have every right to invoke such protections.

The Fair Debt Collection Practices Act (FDCPA) limits what collectors can do in pursuit of their paydays. Among other requirements, for example, collectors must prove (or "validate," to use the Act's language) any allegedly outstanding debt upon request. In other words, the collection agency must show that the alleged debt was ever incurred, that it was not paid, and that it was transferred from the original creditor to them.

Moreover, collectors are prohibited from telephoning too early or too late in the day, customarily interpreted by courts as before 8 a.m or after 9 p.m.

They also may not threaten or insult the consumer in any way, must clearly identify themselves, and may not masquerade as law enforcement entities, credit bureaus, or anything else.

Perhaps the best protections afforded by the FDCPA are the provisions which limit direct contact with consumers. The law prohibits collectors from telephoning a consumer at all, so long as they have been properly informed of that preference.

Such a "cease and desist" notice should be sent to an offending collector by certified mail with return-receipt requested. That way, the affected consumer can produce a record of the notification if the collector continues to telephone incessantly and the matter escalates legally.

If you believe a third-party collector is behaving in an unethical, threatening, or illegal manner, keep careful notes and seek legal counsel. You may even be entitled to a monetary award if the harassment is a clear violation of the federal statute.