Jul 142008

As you all may know I was an owner of a large collection agency and national subrogation company (insurance collections) Having 350,000 debtors in my data base I heard all the excuses and had seen all the collection tactics legally used by my corporation. I am ashamed to say; just like the credit repair business the collection business has some very unscrupulous companies collecting debt. Now that I’m on the other side of the table helping consumers know their rights about credit, I would also like to share with you your rights as a consumer against the unwarranted collection agency. I get hundreds of complaints in my office every day about harassing collection agencies and the illegal tactics used by the companies.
A great many people have collections on their credit report. Most of us have a time in our lives with a medical situation where the bills mounted up or just a web of circumstance that led to us having our accounts sent to collection. It’s not unusual. You may even have the will and volition to pay the debt, but not the means. Whatever the case, it is important to know your rights so that you are equipped with the knowledge to deal with these companies.

Let’s look at the Facts.


1. The consumer is protected under the Fair Debt Collections Practice Act (FDCPA). You may find your rights in detail on line at http://www.ftc.gov/os/statutes/fdcpajump.shtm
2. The original creditor is NOT governed under FDCPA only the collection agencies are held to this act.
3. There are 3 sections to the FDCPA that collection agencies seam to have the most complaints with.
a. FDCPA 806 – Harassment or Abuse
b. FDCPA 807 – Fails or Misleading representation
c. FDCPA 809 – Validation of Debt

Let me give you the “Cliff Note” version of each section. Make sure you challenge the collection agencies on the following:

FDCPA 806 – Harassment or Abuse

• Threatening or the threat and use of violence or the reputation of an individual
• Use of profane language
• Letting the telephone ring, or engage any one in a telephone conversation repeatedly with the intent to annoy, abuse, or harass

FDCPA 807 – Fails or Misleading representation

• Telling you they work for the State or Federal Government Agency
• Telling you they are an attorney or represent an attorney when they do not
• Implying that non payment will result in an arrest, garnishment, lien, ECT. When the collector has no intent or legal ground to do so.
• Telling the consumer they committed a crime in order to disgrace you

FDCPA 809 – Validation of Debt

• Written notice of debt must be sent to you within 5 days of initial contact by phone
• You have 30 days; from the time you receive the collection letter (Dunning Letter), to dispute validity of the debt and ask for proof.
• Upon disputing the debt the collection agency MUST cease all collection activities until verification is mailed to consumer.

Keeping records of all phone conversations is imperative to winning your case. Keep all letters and correspondence received by the collection agency in a file, this will help you if you need to go to court. If the collection agency continues to try and collect the alleged debt without providing you validation you are then able to take them to small claims court in your local area and file suite for $1,000. Remember, the collection agencies count on the consumer’s ignorance of their rights. Although I, at one time, ran a collection agency, it is now my steadfast commitment to shed light on the dubious practices of the unscrupulous companies that take advantage of you, the consumer.

Educating the consumer,

Douglas Muir, CEO
Credit Justice Services, LLC

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