Posts Tagged ‘False’
Duty to Reinvestigate by the Consumer Credit Reporting Agencies
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
CONSUMER REPORTING AGENCY REINVESTIGATIONS and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to conduct a reinvestigation and the procedures around that reinvestigation.
The section that discusses the requirements for reinvestigation of a disputed item is 15 U.S.C. §1681i.
As usual, we start with the statute. Please note that we will only be reviewing the section on reinvestigations, so the rest of the section will not be reprinted or discussed.
(a) Reinvestigations of disputed information
(1) Reinvestigation required
(A) In general
Subject to subsection (f) of this section, if the completeness or accuracy of any item of information contained in a consumer’s file at a consumer reporting agency is disputed by the consumer and the consumer notifies the agency directly, or indirectly through a reseller, of such dispute, the agency shall, free of charge, conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate and record the current status of the disputed information, or delete the item from the file in accordance with paragraph (5), before the end of the 30-day period beginning on the date on which the agency receives the notice of the dispute from the consumer or reseller.
(B) Extension of period to reinvestigate
Except as provided in subparagraph (C), the 30-day period described in subparagraph (A) may be extended for not more than 15 additional days if the consumer reporting agency receives information from the consumer during that 30-day period that is relevant to the reinvestigation.
(C) Limitations on extension of period to reinvestigate
Subparagraph (B) shall not apply to any reinvestigation in which, during the 30-day period described in subparagraph (A), the information that is the subject of the reinvestigation is found to be inaccurate or incomplete or the consumer reporting agency determines that the information cannot be verified.
This section requires a Consumer Credit Reporting Agency to conduct a reinvestigation of their own if a consumer disputes the completeness or accuracy of an item in a credit file.
If a consumer disputes an item (called a tradeline) on a credit file (most people call it a credit report), they have to do certain things. One of the things they must do is an investigation of their own. They are not allowed to just believe the information that is passed to them by the furnisher of the information. This is called parroting, and courts around the country have said that this is prohibited. See, eg: Cushman v. TransUnion, 3rd Cir, 1997. They must look for themselves.
REMEMBER- The Fair Credit Reporting Act is about ACCURACY. If the item you are disputing is accurate and complete, there is no right to sue. This law is NOT strict liability- this means that you must show that they did something wrong, and that as a result of the fact that it is inaccurate and their reinvestigation did not solve the problem, that you suffered actual damages.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
What procedures to assure maximum possible accuracy must the agencies use?
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
MAXIMUM POSSIBLE ACCURACY and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to have a procedure to assure “maximum possible accuracy”.
The section that discusses the requirements for maintain a credit file is 15 U.S.C. §1681e subsection [b].
As usual, we start with the statute. Please note that we will only be reviewing the section on maximum possible accuracy, so the rest of the section will not be reprinted or discussed.
(b) Accuracy of report
Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.
Last time, we talked about Maximum Possible Accuracy for the Fair Credit Reporting Act.
But that is not all. The code says they must have a PROCEDURE TO ASSURE Maximum Possible Accuracy.
This means that they have to think about what is reported, and have a system to know that it is inaccurate.
In each of these cases, the key thing is that the information is inaccurate. Remember, the Fair Credit Reporting Act can only help fix problems of false, inaccurate information. If the information is true, you cannot remove that information, no matter how much you might try.
So what would be a valid procedure?
For example, as the recent consent order in the White/Acosta v. Equifax, TransUnion and Experian cases, has shown, if a consumer files for Bankruptcy, they must change the reporting WITHOUT the intervention of the creditors. So even if your creditors still think update and show that you still owe, they should show that the account is Discharged in Bankruptcy.
They know that they have a problem with mixing credit files up. They have known for several years. They are supposed to be able to keep your file separated, and they know it. That would be another example.
The problem gets stickier when the account is an ID Theft account. How can they know? Maybe, if the account comes with a report that you live at a different address? That should trigger someone looking at the file more closely.
The short of this is that they must actually look at the accounts, and have a way to assure that the information that they are disseminating is accurate to the fullest extent.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
Maximum Possible Accuracy requirement of the Fair Credit Reporting Act
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
MAXIMUM POSSIBLE ACCURACY and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to have a procedure to assure “maximum possible accuracy”.
The section that discusses the requirements for maintain a credit file is 15 U.S.C. §1681e subsection [b].
As usual, we start with the statute. Please note that we will only be reviewing the section on maximum possible accuracy, so the rest of the section will not be reprinted or discussed.
(b) Accuracy of report
Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.
The key term here is that the Fair Credit Reporting Act regulates information that is about you by making it illegal to report inaccurate or outdated information.
So, what is inaccurate?
- Not your account (you never opened or used the account, etc.)
- Illegal use of your account (someone charged something to your account but it was not you)
- Wrong status (Bankrupt, they changed the age of the account, you were never late, etc.)
NOT YOUR ACCOUNT
This comes in 2 major varieties, with some minor variations.
- Identity theft
- Mixed credit file
Identity theft is where someone other than you opens an account in your name, using your name, your social security number, your date of birth, but you never see the account, the card, or the money.
Mixed credit file is where your name is similar to someone or your social security number is similar to someone. In this circumstance, the credit bureaus cannot tell the difference between the 2 of you, so what is on 1 is on both.
ILLEGAL USE OF THE ACCOUNT
This is where you have a credit card with a company, but someone steals your card, and uses that card to purchase things for themselves. This is classic credit card theft.
Another example is where you have the account, but someone steals the card number, and uses that card number to purchase things for themselves or others. This is the newer version of credit card theft.
WRONG STATUS
This is the situation of a paid off account that shows that you owe money.
This can also be an account that shows that you were late when you never were. There are a number of credit card companies that play games, and they might receive the money on the 10th, when the payment is due, but they don’t process the check until after the 20th when it is late. Then they report that you were late, and charge you a late fee. A secret about me —First Tennessee Bank did this to me in the 80s and 90s, and this is one of the reasons I went into consumer law. Another example is mortgage companies that do the same thing.
Bankrupt accounts reporting as still due and owing, or charged off. This is a common problem.
Accounts that are delinquent often go to Debt Collectors. Sometimes they change the date the account first became delinquent, which is the key date the Credit Reporting Agencies use to determine when the account comes off your credit report. Most delinquent accounts can only be reported for 7 years, but some can be reported for 10 (for example Bankruptcy) and others can be reported for as long as they are outstanding (for example tax liens). There is no time limit for a good account to be reported.
If you have been damaged by any of these actions, you could be entitled to recover actual damages, attorney fees and costs, and in the right circumstances, punitive damages are available. Getting to punitive damages is very hard, so we usually tell clients that punitive damages are likely to be limited, if available, in their case.
In each of these cases, the key thing is that the information is inaccurate. Remember, the Fair Credit Reporting Act can only help fix problems of false, inaccurate information. If the information is true, you cannot remove that information, no matter how much you might try.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
What is a consumer debt
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Debt Collection Practices Act is designed to protect consumers from abusive or harassing conduct, false or misleading statements or unfair act by Debt Collectors.
The second question that is key to ask, is What is a debt that is covered by the act?
Not all debts are “debt” for purposes of the Fair Debt Collection Practices Act.
We always start with the statutory definition.
16 USC 1692a[5] says “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.
What this means is that if the debt was incurred to pay for something for you, or your houshold, it is a consumer debt. Examples include credit cards used to pay for family vacations, groceries or gas. It includes your store brand credit cards, if you use them for your self. Your car, if its for your personal use.
It does NOT include debts that are for business, or debts that are not from a transaction.
Lets go over some examples of not-transactions
Taxes, fines, levies, and other tort damages, like car wrecks or assault or shoplifting debts. These are debts that you owe, but there was no bargained for transaction. You did not do something, like negotiate for how much you would pay in taxes, and get something in return (well, maybe you did get something, but police protection, fire departments and roads are not something you negotiate for, you get them because you live there).
A car wreck is another perfect example. You did not agree to get into a car wreck and cause $5,000.00 in damages. You had an accident. This is a tort, called negligence.
So what IS covered?
Basically, anything that is a contract.
Your car loan, for the car that you use to take the kids to soccer, go to the grocery store, and drive to your place of employment, is a contract, for a purchase that you made for your personal use, and for the good of your household. But if you use that car for work- for example, a delivery driver, that car may not be a “personal” use car. It may be a business use.
How about store cards? Lets use a home improvement/hardware store card, as our example, because we can have that for many different purposes.
Lets says you have a credit card with the store, and you want to build a deck on your home. So, you charge the materials, and the brand new circular saw, and the saw horses, and the hammers, and all the other stuff. You are building a deck on your home. This is a debt for personal, family or household purposes.
Lets say you are a contractor, building a deck on a customer’s house. So, you charge the materials, and the brand new circular saw, and the saw horses, and the hammers, and all the other stuff. You are building a deck on your customer’s house. You make a living (we assume) doing construction, so the debt to the store is for a business debt, not a consumer debt. This debt would NOT be covered by the Fair Debt Collection Practices Act.
How about a check to the local grocery store?
The same analysis applies.
Did you buy groceries for you and your family? That is a consumer debt, and is covered by the Fair Debt Collection Practices Act.
Did you buy groceries because you are a caterer, and need supplies for your next job? That is NOT a consumer debt, that is a business debt, and not covered by the Fair Debt Collection Practices Act.
Why is this important?
Because when a debt collector does something that is abusive, false or misleading or unfair, to collect on a CONSUMER debt, they violate the Fair Debt Collection Practices Act. A violation of the Fair Debt Collection Practices Act allows you to sue a debt collector for actual damages, an additional $1,000.00, plus attorneys fees and costs. Please note that the $1,000.00 is NOT per violation, but for all violations that occur.
Read more about what we can do to assist you in protecting yourself from collection harassment or abuse, false or misleading statements or unfair and deceptive acts in the main section of our website.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
Fair Credit Reporting Act Basics (long post)
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
FAIR CREDIT REPORTING ACT BASICS
In this blog entry, we will NOT go into details of what happens or what to do, only the basic outline of what happens and what is supposed to happen when dealing with credit reporting issues under the Fair Credit Reporting Act (FCRA). It is a little bit long, because there is so much information, but bear with us.
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
So what is the Fair Credit Reporting Act?
The Fair Credit Reporting Act, or FCRA, is the law that requires that your credit file, commonly called a credit report be accurate. It is found in the US Code at Title 15, Chapter 41, Subchapter III, or Title 15 US Code sections 1681 through 1681x. Prior to the advent of this act, state and local law on defamatory statements were what controlled the dissemination of inaccurate information. It required a showing of malicious intent, a standard which is pretty hard to ascribe to a corporation or business.
Congress passed the FCRA to protect consumers (individuals) from the credit reporting issues of the Consumer Reporting Agencies, commonly called Credit Reporting Agencies. For brevity, we will call Consumer Reporting Agencies CRAs for this article.
Later, the FCRA was amended to add protections from actions of furnishers and users of consumer credit files. Furnisher is not a term that is defined, but has been held to mean any entity (person or business) that provides information to the CRAs. Users are entities (persons or businesses) that access the information stored at CRAs.
So who are the CRAs? And who are Users? And who are Furnishers?
The BIG 3 CRAs are Equifax Information Services, LLC (Equifax), Trans Union, LLC (TransUnion) and Experian Information Solutions, lnc. (Experian). There are others, some are up and coming companies that are attempting to challenge the Big 3, like Innovis Data. Others are “specialty” reporting agencies, like Medical Information Bureau, ChexSystems, and TeleCheck Services.
Users are companies who either you would like to do business with, or THINK you would like to do business with them. Examples are Discover Card, American Express, Chase, CitiBank and Capital One. They have a legitimate interest in seeing your credit file, to see if you are the kind of person who pays their bills. They want to loan money to people who, by and large, pay their bills. Preferably not all at once, so they can charge interest, but still, you should pay your bills.
Furnishers are the same people as users, only they are providing feedback about how well you pay them. Examples are Discover Card, American Express, Chase, CitiBank and Capital One. They are telling other people about their experiences with how you pay your bills- on time, late, or not at all.
So what kinds of things are violations?
The FCRA regulates most portions of the credit reporting industry.
Impermissibly accessing a person’s credit report allows, not only civil damages, similar to invasion of privacy, but in some cases, also criminal penalties.
The CRAs must maintain an accurate file on you, and their failure can lead to civil damages.
The CRAs also must investigate your complaints. If you tell them something is wrong, they must investigate, tell the furnisher, and if the information is inaccurate or unverifiable, change or delete the information.
Furnishers must also be tasked with reporting to the CRAs your credit reporting history accurately, but, they must be notified properly before you can sue them for those damages. We recommend that you tell the furnisher what they are reporting wrong. Tell them in detail, and preferably in writing. YOU DO NOT HAVE A RIGHT TO SUE FOR THE FURNISHER MESSING THIS PART UP. See 15 USC 1681s-2[c] and [d].
However, if you also notify the CRAs of the inaccuracy, they must send your dispute to the furnisher, and once they get the dispute that way, they must fix the problem, or face the possibility of being sued. You must dispute to the CRA dispute addresses. We suggest that you do your dispute in writing, sent by certified mail, return receipt requested. It is not necessary to do this, but it makes proving that you notified them of the dispute easier.
What can you sue for?
FCRA is not a strict liability lawsuit, like the FDCPA or TILA or other actions. Technical violations are NOT something you can sue for. The FCRA is there to protect you from inaccurate information, so as numerous courts have said, you can only sue for information that is inaccurate. But what is inaccurate?
Examples of inaccurate information are
- Identity theft, where someone unknown to you (or maybe known to you, but you did not know they were doing this) opened an account that you did not know was being opened.
- Mixed Credit File, where the CRAs have mixed you up with someone else, and their information is on your credit report. Mixed files and ID theft may be very hard to tell apart until the lawsuit has been filed, and discovery has started.
- Reporting an account that you have paid as still owing.
- Reaging, where they are reporting that an account that you failed to pay years ago, as a recent failure to pay. This is particularly common when the statute of limitations has passed for the collector or creditor to sue to collect the money. Most negative information can only be reported for 7 years, but there are exceptions. 15 U.S.C. §1681c.
- Bankrupt account reporting, where the consumer has filed Bankruptcy, and the creditor either still, or again, reports the debt as owing or charged off, rather than discharged in Bankruptcy. This may also be a violation of the discharge of Bankruptcy, 11 U.S.C. §524.
In each of these cases, if the information is there, it can cause damages, such as loss of ability to obtain credit on terms that YOU deserve. This can lead to other issues, which we will discuss in great detail in another blog entry.
If you have been damaged by any of these actions, you could be entitled to recover actual damages, attorney fees and costs, and in the right circumstances, punitive damages are available. Getting to punitive damages is very hard, so we usually tell clients that punitive damages are likely to be limited, if available, in their case.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
TeleSpoofing
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Debt Collection Practices Act is designed to protect consumers from abusive or harassing conduct, false or misleading statements or unfair act by Debt Collectors.
What is TeleSpoofing and is it “false and misleading” under the Fair Debt Collection Practices Act?
TELESPOOFING IN COLLECTIONS
As usual, we start with the statutory definition. Thanks to LII.
15 U.S.C. §1692d says
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:
. . .
(6) Except as provided in section 1692b of this title, the placement of telephone calls without meaningful disclosure of the caller’s identity.
15 U.S.C. §1692e says
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:
. . .
(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.
. . .
What does this mean for you?
Knoll v. IntelliRisk Management Corporation, 2006 U.S. Dist. LEXIS 77467 (Lexis citation), 2006 WL 2974190(parallel WestLaw citation) (D. Minn. October 16, 2006), says that when a debt collector misrepresents his phone number (by TELESPOOFING) it is a misrepresentation of the identity of the caller, and therefore a misrepresentation that violates the Fair Debt Collection Practices Act. 15 U.S.C. §1692e[10] It also explains that the debt collector must meaningfully disclose his identity, and by misidentifying themselves be TELESPOOFING, they are not meaningfully disclosing their identity. 15 U.S.C. §1692d[6].
Debt collectors are allowed to use aliases, under some circumstances. For example, if they have a way to backtrack to determine who called, that would be permissible.
On the other hand, when they refuse to identify the name of the company they work for, they are not meaningfully disclosing their identity, and they are using a false and misleading means to collect a debt.
NON COLLECTIONS TELESPOOFING
But collections are not the only time we need to worry about TELESPOOFING. Scammers come in all types. There was a recent new story on my local Fox affiliate, in which they talked about telespoofing. There are a number of companies that provide the services, and the scammer can appear to be anyone they want to be. They can be your friend, your neighbor, your child or grandchild. And they often will ask for money.
In the story on the news, a local lady had a call from someone who said he was her grandson and he had been in an accident, and he needed $5,000.00. The Caller ID showed that it was from a hospital. So, she was all too happy to send money to her “grandson”. Only afterwards, did she realize that it was all a scam.
Can we get that money back? Maybe, but that will depend on if we are able to identify the culprit. It is easier with a debt collector, because they will either eventually tell you who they really are, or they will have you send the money somewhere. But if they have you send the money by Western Union, or other wire service, it may be all but unreachable.
Stay tuned and come visit us NEXT WEEK when we talk about COMMUNICATING WITH THE CONSUMER in collection practices.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FDCPA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
What is FALSE or MISLEADING under the FDCPA?
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Debt Collection Practices Act is designed to protect consumers from abusive or harassing conduct, false or misleading statements or unfair act by Debt Collectors.
What is “false and misleading” under the Fair Debt Collection Practices Act?
As usual, we start with the statutory definition. Thanks to LII.
15 U.S.C. §1692e says
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 subchapter.
(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 1681a (f) of this title.
What does this mean for you?
Short version is that they cannot lie about anything. They can’t tell you that you owe money if you don’t. They can’t tell you that you will go to jail over a regular old debt, (though that might be abuse under the act, also), and they can’t tell you anything untrue, generally.
Lets talk about some of the specifics.
§1692e[2] says they cannot misrepresent the amount, character or status of the debt. Examples of this are representing that the debt is still owed if you have already won the collection lawsuit, or if you have filed for Bankruptcy. In fact, there is caselaw that says that collecting on a debt Discharged in Bankruptcy is a violation, Turner v J V D B Assocs Inc, 330 F. 3d. 991 (7th Cir. 2003). Note that there are defenses that are winnable for the debt collector. And certainly, a junk debt buyer who has sued and lost and still sends letter a- knows you have a lawyer and b-knows they lost and that they are collecting a debt the judges says you don’t owe.
§1692e[3] says that they cannot say they are an attorney if they are not. Examples of this are when the letter says it comes from an attorney’s office, but the attorney never looked at the letter or the file. But they can put language in the letter that says that no attorney has looked at the file, and that (apparently) makes it all OK. (I don’t agree, but then I am not a judge.).
§1692e[4] says that they can’t tell you that you will go to jail or that they can garnish you if they can’t. Examples of this are where they don’t have a judgment, and they don’t sue. There are lots of debt collectors who just simply don’t sue. They aren’t lawyers (note the theme from above), and they don’t hire lawyers. Also, you can’t go to jail for the non-payment of most debts. There are exceptions. Some of the exceptions are for checks that are drawn on closed or overdrawn accounts (commonly called bad checks). But a credit card that you didn’t pay, or a payday loan that you did not pay is NOT a criminal violation, and you cannot go to jail. In fact, for payday loans, it is a violation of the Virginia Payday Lending Act for the payday lender to tell you that you can go to jail for writing a check that bounces (note: a closed account is different- you can go to jail for that.)
§1692e[8] says that they cannot communicate false credit information. This dovetails into the Fair Credit Reporting Act. This includes if you dispute the debt, and they don’t bother to tell anyone that you disputed, but somehow, they say that you still owe the money. There is case law on this point also. If they update your credit file, they are required to identify your account as disputed.
§1692e[9] says they can’t simulate court documents. This essentially means they can’t send you something that LOOKs like a lawsuit if it is NOT a lawsuit.
§1692e[10] says they can’t use false or misleading means to collect. This applies to EVERY communication. Examples of this are when they talk to your neighbors or co-workers (which may violate other provisions also), or tell you something that is not true. This may be a redundant section, but there are some things that fall into the grey areas that are caught here.
§1692e[11] requires that the debt collector tell you that they are debt collectors. Often they will forget to use this language in voice-mails. A voice mail left on your voice mail that just says “we are calling about an important business matter, please call us back at phone number ___” There is actually a name for this syndrome by debt collectors, this violation is called a Foti (after Foti v. NCO) violation, though I think it should be renamed a Edwards (after Edwards v. Niagra Credit (11th Cir)) violation.
§1692e[13] dovetails with 1692e[9]. It says they can’t simulate legal process. That means that they can’t make a document look like a summons or warrant (civil or criminal).
If they are a lawyer or they do sue, §1692e[15] would come into play. This subsection says that if they send you a summons or warrant, they can’t tell you that its NOT a court document. Here’s where I have some issues, and we may see a long blog post about this particular issue. I am not sure that it is (or isn’t) OK for them to sue you (in Virginia, the form is called a Warrant in Debt) and then tell you that you don’t have to show up for court. Technically, this is half true. If you owe the money, and you don’t dispute anything, and you are just going to tell the judge that you owe the money, then coming to court for that is a waste of time. The judge will enter judgment against you. If you don’t show, the judge will enter judgment against you. So what’s the difference? I think that if the collector tells you that you don’t have to show, they should also HAVE to tell you that if you don’t show that a judgment will be entered against you. What if they agreed to a payment plan? Did they agree to continue the case and not enter the judgment? If not, when they agreed to the payment you may end up with a judgment so they can enforce your payment plan. That MAY be a violation. I think it falls into a better violation of Unfair and Deceptive act.
Stay tuned and come visit us NEXT WEEK when we talk about UNFAIR AND DECEPTIVE collection practices.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
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