Debt Collectorcollection companies
Collection company escapes FDCPA responsibility with clear validation note
The U.S. District Court for the District of New Jersey on May 2 issued a petition to a debt collector to deny an alleged collective claim under the Fair Debt Collection Practices Act because the validity note in the debt collecting note was not obscured or refuted by another writing in another currency.
The plaintiff Alex Reizner had a debt of 96,601.75 US dollars to the US Department of Education. On 28 March 2017, the DOE transferred the receivable to National Recoveries, Inc. NRI sent a debt recovery note to Reizner that afternoon telling him that she would collect his debt to the DOE. The NRI contained the following validating note in the second section, printed in bold:
If you do not inform this bureau within 30 working days of receipt of this notification that you contest the validity of the debt or any part thereof, this bureau will presume that the debt is current. If, within 30 working days of receipt of this communication, you give written notification to this bureau that you contest the validity of this debt or any part thereof, this bureau will obtain a review of the debt or a copy of a judgement and will send you a copy of this review or judgement.
At your writing within 30 working days of receipt of this notification, this authority will notify you of the name and physical location of the initial believer if different from the present believer. It also contained a telephone number, facsimile number and e-mail addressee to which a complaint, question or concern could be addressed.
In addition, nothing in the remainder of the Reizner epistle menaced or emboldened him to renounce his right to contest the debt. When analysing the correspondence, the Court of First Instance differentiated the case-law held by other debt collecting correspondence in breach of the FDCPA. Often, these mailings encourage the receiver to call the debt collector, which may mislead the least savvy user into thinking that he or she does not have to write down the debt as prescribed by legislation.
Moreover, these correspondence often contained the warning of an immediate claim if the borrower did not make payment, which would conflict with the 30-day period in the validity decision. Elsewhere, the validating note would appear on the back of the note or otherwise be unobtrusively hidden in the text. NRI's note, according to the court, did not suffer from any of these deficiencies.
The NRI avoided responsibility because it clearly emphasised its declaration of validity and did not otherwise object with threat of immediate measures or an invitation to appeal. It underlines the importance of debt recovery companies that include a clear and undisputed audit opinion in their debt recovery circular. You should assess your debt recovery letter to minimise the risk of possible FDCPA liabilities.