FDCPA Updates for

Update from: March, 2001


e-PRG provides select, updated information
from the Federal Trade Commission on issues pertaining to the
Fair Debt Collection Practices Act. Our updates focus on opinions
that could impact the way creditors and non-attorney third
parties communicate with consumers to collect debts.

Past Newsletter Archives:

September, 2000, October 2000



The Federal Trade Commission (FTC) is required by law to report annually to Congress on its activities, including those surrounding enforcement of the Fair Debt Collection Practices Act (FDCPA). During Y2K, complaints to the FTC from consumers regarding third-party collection activities continued to exceed complaints form any other industry.

16% of the complaints were for false or misleading statements about the true status or amount of the debt, such as pending legal action or the amount of debt owed. Complaints that a verification notice was not sent, calls were made to an employer when prohibited, and threats were received each comprised about 5% of the complaints. Ominously, the FTC commented in its report that it considers the complaints it hears to be a small percentage of the actual violations experienced by consumers.

Finding of violation can be onerous. The FTC cited its July 2000 settlement with North American Capital Corporation for $250,000 for complaints that included improper third party disclosures and profane language, as well as false and misleading statements.

The FTC also reported to Congress that over one-third of the total collection industry complaints it received were about in-house collectors.  While acknowledging that such complaints cannot be pursued under the Federal Trade Commission Act. As if that warning were not sufficient, the report pointed out that March 2001 charges against The Associates and its successors were filed under the FTCA.

What is the best prevention? The FTCs Annual Report emphasizes the importance of education and information. Contact Phoenix Resource Group today to learn more about how our interactive CD-ROM can help your organization avoid complaints, investigations and penalties.

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