Fair Debt Collection Practices Act prohibits abusive
practices by debt collectors as amended by Public Law 104-208, 110 Stat. 3009
(Sept. 30, 1996)
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The entire Fair Debt
Collection Practice Act for those who desire read it in its entirety.
Short Title - 801.
Congressional findings and declaration of purpose - 802 .
Definitions - 803 .
Acquisition of
location information - 804.
Communication in connection
with debt collection - 805
Harassment or abuse -
806.
False or misleading representations - 807.
Unfair practice - 808.
Validation
of debts - 809
Multiple debts - 810.
Legal actions by debt collectors - 811.
Furnishing certain deceptive forms - 812.
Civil liability - 813.
Administrative
enforcement - 814.
Reports to Congress by the Commission
- 815
Relation to State laws - 816.
Exemption for State regulation - 817.
Effective date - 818
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To amend the Consumer Credit Protection Act and to prohibit
abusive practices by debt collectors.Be it enacted by the Senate and House
of Representatives of the United States of America in Congress assembled,
That the Consumer Credit Protection Act (15 U.S.C. 1601 et seq.) is amended by
adding at the end thereof the following new title:
up 801. Short
Title [15 USC 1601 note]
This title may be cited as the "Fair Debt Collection Practices
Act."
up § 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
instrumentalities 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.
up § 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.
up § 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.
up § 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 antimeridian 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 postjudgment
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.
up § 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) 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.
up § 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.
up § 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 nonjudicial
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.
up § 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.
up § 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.
up § 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.
(b) Nothing in this title shall be construed to
authorize the bringing of legal actions by debt collectors.
up § 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.
up § 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.
up § 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).
(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.
up § 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.
up § 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.
up § 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.
up §
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
ENDNOTES
1. So in original; however, should
read "604(a)(3)."
LEGISLATIVE HISTORY:
Public Law 95-109 [H.R. 5294]
HOUSE REPORT No. 95-131 (Comm. on Banking,
Finance, and Urban Affairs).
SENATE REPORT No. 95-382 (Comm. on Banking,
Housing, and Urban Affairs).
CONGRESSIONAL RECORD, Vol. 123 (1977):
Apr. 4, considered and passed House.
Aug. 5, considered and passed Senate, amended.
Sept. 8, House agreed to Senate amendment.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol.
13, No. 39:
Sept. 20, Presidential statement.
AMENDMENTS:
SECTION 621, SUBSECTIONS (b)(3), (b)(4) and (b)(5)
were amended to transfer certain administrative enforcement responsibilities,
pursuant to Pub. L. 95-473, § 3(b), Oct. 17, 1978. 92 Stat.
166; Pub. L. 95-630, Title V. § 501, November 10, 1978, 92
Stat. 3680; Pub. L. 98-443, § 9(h), Oct. 4, 1984, 98 Stat.
708.
SECTION 803, SUBSECTION (6), defining "debt
collector," was amended to repeal the attorney at law exemption at former
Section (6)(F) and to redesignate Section 803(6)(G) pursuant to Pub. L. 99-361,
July 9, 1986, 100 Stat. 768. For legislative history, see H.R. 237,
HOUSE REPORT No. 99-405 (Comm. on Banking, Finance and Urban Affairs).
CONGRESSIONAL RECORD: Vol. 131 (1985): Dec. 2, considered and passed House.
Vol. 132 (1986): June 26, considered and passed Senate.
SECTION 807, SUBSECTION (11), was amended to affect
when debt collectors must state (a) that they are attempting to collect a debt
and (b) that information obtained will be used for that purpose, pursuant to
Pub. L. 104-208 § 2305, 110 Stat. 3009 (Sept. 30, 1996).
Rich's Enterprises, L.L.C.
Prattville, Alabama
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