Fair Debt Collection Practices Act

The goal of this Act, approved in September 1977, was to eliminate abusive debt collection practices by debt collectors and to promote consistent state action to protect consumers against debt collection abuses and invasions of individual privacy.

The Fair Debt Collection Practices Act laid down specific guidelines pertaining to these processes:

Acquisition Of Information

Any debt collector trying to obtain location information of a customer would identify himself and his purpose properly and when the need arises also disclose his employer. At no stage during the inquiry procedure shall the collector state or imply that a consumer owes any debt, as this will amount to invasion of privacy. When the enquiry procedure has been completed, any correspondence then shall be with the attorney of the said consumer only.

Communication With the Client

The debt collector may not communicate with the customer in such a time or place, which might be known to be inconvenient to the consumer. If the collector has information that a lawyer represents the customer, then any communication with the customer ought to be carried out only if the lawyer fails to respond to the collector's communicating.

Abuse Or Harassment Of The Consumer

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. A collector may not resort to acts of violence or threats thereof to be able to coerce the consumer into obliging to the collector.

Misrepresentation For Debt Collection

A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. The debt collector may not represent or in any way implicate that nonpayment of the debt will result in the arrest or imprisonment of any person or the seizure, attachment or sale of any property of any person unless such action is lawful and the debt collector or creditor intends to take such actions.

Debt Validation

Within five days after the initial communication with a consumer, the debt collector will send the consumer a written notice containing the precise quantity of debt, the name of the creditor and the expected date of payment.

Civil Liability

Any debt collector who fails to comply with any provision of this act is liable to such individual in an amount equal to the degree of actual damage to the customer and might be liable to pay the customer the defendant attorney's fees reasonable in relation to the work expended and costs.

The Fair Debt Collection Practices Act provides guidelines for all sorts of debt collection. For many debt collectors, be in-house or collection agencies, it is must to understand the act and keep within the legally permitted boundaries. The Fair Debt Collection Practices Act has sufficient provisions for collection agencies and departments to help them get the dues from the debtors legally.