The Fair Debt Collection Practices Act ("FDCPA"), is a Federal law governing the collection of certain kinds of debt. In order to understand what falls within the purview of this law, it is important to distinguish between "commercial" debt and "consumer" or "retail" debt. A commercial debt is typically viewed as an obligation for goods sold or services rendered in connection with the operation of a business. Debts incurred by individuals for personal, household or family purposes are consumer debts. Generally speaking, the FDCPA applies to consumer debt.
The FDCPA is a relatively straight-forward statute. It was enacted in response to legislative findings of evidence of abusive, deceptive and unfair debt collection practices. In enacting this law, Congress wanted to eliminate these practices but, at the same time, not place debt collectors who refrain from abuse at a competitive disadvantage in collecting debts.
Conduct Prohibited by the FDCPAThe FDCPA prohibits certain types of "abusive and deceptive" conduct when attempting to collect debts by regulating the following conduct:
The FDCPA requires debt collectors to do, among other things, the following:
The US Federal Trade Commission is formally charged with enforcement of the FDCPA. However, the primary enforcement mechanism is by private action. Put somewhat differently, debt collectors who fail to comply with the law's requirements can be sued by the debtors who owe them money. These lawsuits can force the debt collector to pay awards to the debtor that are out of all proportion to the amount the collector originally sought.
The message of the FDCPA is really very simple - debt collectors must comply with proper debt collection procedures when attempting to collect debts subject to the statute.
Against this backdrop, it is imperative to use a collection attorney who understands the laws and procedures governing collection practice, including the special requirements that the FDCPA imposes upon consumer debt collection. The failure to do so could create exposure to liability far exceeding the amount owed by the debtor.
We are a New Jersey debt collection firm. If you are attempting to collect debts in New Jersey, contact Mr. Friedman at 800-361-6554 to discuss your collection needs.
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