Federal Trade Commission Offers Advice on FDCPA
The FTC Enforces Fair Debt Collection Practices in the US
Jun 4, 2009
Despite a May 7, 2009 Federal Reserve Statistical Release which shows consumer credit in March 2009 decreasing at an annual rate of 5.25%, many Americans face the specter of having to deal with debt collection agencies. Given that some of these agencies may use unsavory or questionable tactics to force consumers to pay outstanding debts to their creditors, the Federal Trade Commission offers some appropriate advice.
The Federal Trade Commission (FTC): “Enforces the Fair Debt Collection Practices Act (FDCPA) which prohibits debt collectors from using abusive, unfair or deceptive practices to collect from you.”
Debt Collection Law
The Commission explains quite clearly what types of debts are covered under the Act. They are: personal, family and household debts. For example, personal and credit card loans, medical bills and mortgages. The FDCPA does not cover business related debt.
Advice From Federal Trade Commission Based on FDCPA
- A debt collector cannot contact a person at inconvenient times, such as early in the morning or late at night. They cannot contact people at work if they have been told either verbally or in writing that personal calls are not allowed at work.
- “What Practices are off limits to debt collectors?” This is one of the most frequently asked questions of the FTC. In response they have said that debt collectors may not: harass, abuse, offer threats of violence, use profane language or make repeated telephone calls to people.
- Debt collectors should not falsely claim that they are attorneys or government representatives or say that papers they send to people are legal documents if they are not.
- If debts are not paid, a creditor or its representative can sue a person in order to collect. If the court gives a judgment against the debtor, it allows the creditor or collector to get a garnishing order, which may be against a bank account or a person’s wages.
- Many federal benefits are exempt from garnishing including: Social Security Benefits, Supplemental Security Income Benefits, Veteran’s Benefits and Student Assistance.
Dealing with Debt Collectors
To report a debt collector, for an alleged violation, a person should contact their state Attorney General’s office and the Federal Trade Commission. However, people should be aware that many states have their own debt collection laws that are different from the federal Fair Debt Collection Practices Act. The local Attorney General’s office should be able to advise on the correct procedure.
Consumer Protection Agency
For those that need help with debt or information relating to debt collection, support is available from the websites of the Federal Trade Commission and the US Financial Literacy and Education Commission.
This information, which is not exhaustive, is obtained from the sources listed below but is not offered as financial advice.
Sources:
Federal Trade Commission, Debt Collection FAQs: A Guide for Consumers, February 2009
Federal Reserve Statistical Release, Consumer Credit, May 7, 2009
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