Alexander J. Douglas, Esq. | Attorney | (585) 568-2224 |   alex@lawroc.com

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U.S. Government Reveals Shocking Debt Collection Report

U.S. Government Reveals Shocking Debt Collection Report

In yesterday’s issue of USA Today, the newspaper reported that more than one in four American consumers who were contacted by a debt collection agencies felt threatened during the conversations.

In addition to this rather sad and sobering statistic from the Consumer Financial Protection Bureau (CFPB), approximately 40% of consumers requested that the debt collector stop calling them. (While debt collectors are required to obey a written request to stop calling, the law doesn’t explicitly require that they obey a verbal request. However, if they ignore such verbal requests, they might be violating other federal laws against calling your cell phone without your consent.)

The CFPB also reported that many of the accounts for debts sold to debt buyers included unencrypted social security numbers. The potential for abuse and catastrophe here is obvious, as it appears that debt buyers and debt collectors may not be taking sufficient precautions with highly sensitive consumer information. Identity fraud is obviously a major concern.

CFPB Director Richard Cordray stated that the CFPB “is working to clean up abuses in this industry, and to see that all consumers are treated with fairness, decency, and respect.” The director continued to talk about debt collection problems. “We have seen that many consumers report being harassed or threatened with illegal actions, such as threats or arrest or jail time,” Cordray added.

The article also notes that debt collectors are required to abide by federal laws regulating their businesses, including the Fair Debt Collection Practices Act (FDCPA), which prohibits harassment and abuse, and the Telephone Consumer Protection Act (TCPA), which prohibits auto-dialed calls to cell phones without the consent of the consumer.

As we’ve also reported in the past, debt collection abuses account for the top complaint received by the CFPB from American consumers.

Remember: you have many rights under federal law if you have any debt in collections, and debt collectors should not violate these rights without consequence.

Debt Collection is Top Complaint for U.S. Consumer Complaints

Debt Collection is Top  for U.S. Consumer Complaints  in Consumer Financial Protection Bureau’s (CFPB) 2016 Report.

This week, the Consumer Financial Protection Bureau (CFPB) released its December, 2016 report about recent consumer complaints. You can read an article about the report here HERE, and you can read the report itself HERE.

As should come as no surprise, the number one U.S. consumers complaint is debt collection, which is approximately 30% of the total complaints. This includes almost 300,000 complaints since the CFPB first began hearing them in 2011. Debt collection complaints, along with credit reporting and mortgage complaints, represented about 64% of the total consumer complaints for the year.

The most consumer complaints involved debt collectors trying to collect debts that have already been paid, or debt collectors refusing to provide verification for the consumer’s accounts, despite receiving such a request from the consumer. Consumers also complained about receiving too many calls from debt collectors.

Consumers also complained about debt collectors placing telephone calls to their employers in an attempt to collect their debts, especially after the consumer informed the debt collector that they were not allowed to receive those types of calls while at work.

Complaints regarding student loan debt collection showed the greatest percentage increase based on a three-month average, which indicates that consumers are not satisfied with student loan debt collectors. Recently, the Department of Education awarded contracts to several debt collectors to collect on federally-insured student loans. One should question whether these collectors are adequately following federal and state debt collection law, particularly the laws that apply to federally-insured student loans.

Rochester Debt Collection agency Tries to Open New Office

conserve-debt-collectionsThis week, local media reported that Rochester-based debt collector ConServe is attempting to open a new call center office in Victor, New York, for its debt collection operations. The Democrat and Chronicle discussed the Victor residents’ concerns with traffic problems that might lead from the new call center, which hopes to contain approximately 1,000 new employees.

Besides traffic, another concern is whether or not ConServe’s Fair Debt Collection Practices Act (FDCPA) employee training will be adequate. Certainly, when adding that many new employees at the same time, their leadership should be concerned with ensuring that its telephone collection representatives follow the FDCPA.

Specifically, the representatives need to make sure that they do not misrepresent anything about the consumer’s debt. They are also bound by law to not harass the consumer, use obscene language towards the consumer, or do anything to collect the debt that might be considered unfair and in violation of the FDCPA.

Certainly, we welcome new businesses that help bring jobs to the area. We just hope that ConServe has, and will continue to have, a robust training program for its employees to ensure that they are following federal debt collection law in Rochester, and that they treat consumers with the dignity and respect that they deserve.

Remember – you have rights under the FDCPA to be free from harassment, abuse, and misrepresentation by debt collectors.

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