This post is part of Priori’s blog series “From Our Network,” where we feature lawyers in our network discussing important issues small businesses face. After every post, we give our readers a chance to ask the lawyer questions, and the lawyer picks several to answer. In today’s post, collections lawyer Ariel Berschadsky answers reader questions about what rights and remedies you have when a debt collector comes calling.
You say a debt collector can contact third-parties to discover basic information. Are they allowed to identify themselves as a debt-collector and/or disclose any information about the debt you supposedly owe in furtherance of that? If they can't, how would they get that information out of a third-party? How many people can they contact?
Other than to obtain location information, a debt collector may not contact third parties such as a consumer’s friends, neighbors, relatives, or employer. However, a collector may contact third parties in order to learn the consumer’s residential address and phone number or his/her work address. Even when obtaining this limited information, the collector may not state that the consumer owes any money and cannot use the collection company’s name unless it is requested. A collector may also contact a third party if reasonably necessary to effect a postjudgment judicial remedy (e.g., a wage garnishment). There is no limit on the number of people a debt collector may contact.
What qualifies someone as a debt-collector? Is it, by definition, a third-party who has purchased the debt or been paid by the creditor, or is it anyone trying to collect a debt? Is the original creditor hemmed in by the same rules?
The FDCPA only governs third party debt collectors, not the primary creditor. A primary creditor’s actions are governed only by State laws (e.g., laws against defamation, unfair and deceptive acts). This gives the original creditor much more leeway, when it is trying to collect its own debts, to engage in abusive behavior.
The FDCPA generally applies only to collection agencies and lawyers. If the debt was sold, the new creditor (purchaser of the debt) is not subject to the FDCPA. However, any debt collection agency or lawyer acting on the purchaser’s behalf would be.
If you lie to a debt collector about your identity (or refuse to answer) and the debt collector also violates some of the rules, can you still sue and recover?
Yes, you can still sue, as long as your lies did not cause the collector to inadvertently violate the FDCPA. However, your lies could affect your credibility before a judge, reducing your monetary award.
You wrote that debt collectors can't contact you at the office if they know your employers object. What type of ways can an employer object? If your employer has a policy against it, is that enough? Or will they insist on talking to your employer?
Some employers have policies against having personal communications at the office. If the collector is informed of such a prohibition, it must stop contacting the consumer at the office. Furthermore, debt collectors are prohibited from contacting a consumer at an inconvenient or unusual place. For some workers, their workplace is an inherently inconvenient place to be contacted (e.g., nurses, assembly lines, restaurants). The Federal Trade Commission has notified several debt collectors than any consumer’s workplace may by its nature be an inconvenient place to receive debt collection contacts. The best thing to do is to tell a debt collector that your employer objects to your dealing with that issue during working hours (regardless of whether or not there is an explicit policy against it). It is very unlikely that the debt collector will risk contacting you again at work.
Photo Credit: TaxRebate.org.uk via flickr