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Government Begins Crackdown on Illegal Debt Collection

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The federal law called the Fair Debt Collection Practices Act (FDCPA) provides important protection against debt collectors who are abusive, threatening, inflating the amount due, lying, cheating or engaging in other types of illegal conduct.  Spearheaded by the new Consumer Financial Protection Bureau (CFPB), the government has been cracking down on debt collectors who have violated the FDCPA.  One major problem, though, has been that the FDCPA does not apply to credit card companies because they are generally excluded from the definition of “debt collector”.

Recently, however, the federal government informed the credit card companies that it would also hold them to the same standards prohibiting abusive and illegal debt collection practices.  On July 10, 2013, the CFPB announced that all debt collectors are prohibited from engaging in unfair, deceptive or abusive tactics in collecting consumer debts.  The Bureau stated that such acts and practices are prohibited by the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The specific types of conduct that are prohibited under the Dodd-Frank Act are similar to those prohibited by the FDCPA and include the following:

  • Collecting a debt that includes interest, fees, charges or other amounts that are not authorized by your agreement that created the debt
  • Failing to post your payments on time and then charging you late fees
  • Revealing your debt to third parties such as your employer or co-workers
  • Misrepresenting the character, amount or legal status of the debt; examples include asking for more money than you owe, suing you for a debt that you already paid, suing you for a debt that was discharged in bankruptcy, etc.
  • Misrepresenting that a debt collection communication is from an attorney or government agency, when it is not
  • Misrepresenting whether they will report your debt to a credit bureau
  • Misrepresenting that a settlement offer results in forgiveness of the debt, if it does not
  • Falsely threatening that they will sue you, if they do not intend to do so
  • Falsely threatening that you will be arrested, jailed, prosecuted, or have your children removed from your home (and yes, this actually still occurs)
  • Representing that your payment will cause the debt to be removed from your credit report if the debt was too old to be reported on your credit report anyway
  • And many other tactics

In Florida, many of these actions will also result you being able to sue the debt collector under the Florida Consumer Collections Practices Act.  If you win such a lawsuit against a debt collector, you can recover a penalty of up to $1000, plus any additional actual damages you have suffered, along with your attorney fees.

If you have been victimized by a debt collector, we would be honored to seek justice on your behalf.  Call us today at (407) 333-0001 for a free consultation, so that we can explain your rights and remedies against the debt collector.