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Is this legal or is it fraud?

I received a collections notice from a company that claims to have purchased the debt. However its on an attorneys letterhead it has referenced and placed the account which is in “default” with the law office. States no attorney has reviewed the case yet and I have thirty days to dispute or set up payments with them or they will assume the debt valid and obtain a judgment and mail it. Is this legal or is it fraud?

First things first! Is there an actual debt? Is it yours? Is it valid? If the debt does exist, DO NOT ignore the letter. Respond based on your belief of the debt’s status. If you believe the debt is someone else’s or you need verification, then you must tell the collection agency this in writing.

Assuming the debt does exist, collection agencies purchase debts all the time so it’s entirely possible this agency has purchased your debt. However, given what you’ve described I am concerned about the legality of the letter.

You say the letter states:

1. The account has been “placed with a law office” but that “no attorney has reviewed the case yet”

2. The letter is on “attorney letterhead”.

3. They will “obtain a judgment.”

Next, consider this section of the FDCPA and then take appropriate action:

Section 807(3) prohibits falsely representing or implying that “any individual is an attorney or that any communication is from an attorney.”

1. Form of legal correspondence. A debt collector may not send a collection letter from a “Pre-Legal Department,” where no legal department exists. An attorney may use a computer service to send letters on his own behalf, but a debt collector may not send a computer-generated letter deceptively using an attorney’s name.

2. Named individual. A debt collector may not falsely represent that a person named in a letter is his attorney.

So, if you believe this letter violates the above section, report it to your state attorney general right away. Be prepared to provide them with a copy of the letter.

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One comment

  1. I have been making agreed monthly payments and yet, the creditor has entered the loan into collections. I this legal?

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