March's Top Ethics Complaint: Attempting Collection from the Wrong Person

Published: Friday, April 15, 2005

The top ethics complaint for the month concerned debt collectors allegedly attempting to collect from the wrong person. The FDCPA requires that within five days of an initial communication with a consumer in connection with the collection of a debt, the debt collector must send the consumer a written notice, known as a validation notice.

One of the primary purposes of the validation notice is to prevent a collector from collecting a debt from the wrong individual. This notice contains information regarding the debt and provides that the debt will be assumed to be valid by the debt collector unless the consumer disputes the validity of the debt within 30 days of receipt of the validation notice. It further notifies the consumer that if she disputes the debt in writing, the collector will cease collection activities until verification is sent to the consumer. Upon receipt of such a request, the debt collector must cease collection activity until obtaining verification from the creditor that the amount demanded is the amount owed by the consumer from whom the collector is attempting to collect and provides this information to the consumer. If no verification is available, the collector may simply cease all attempts to collect the debt.

If the consumer alleges that the debt collector is attempting to collect from the wrong person, the collector may request appropriate proof of identity. A collector may find it necessary to request copies of government-issued identification documents, copies of utility bills or having the consumer answer questions to which only she would have the answers. Consumers, however, are not required to respond to these inquiries.

If the consumer alleges that the debt is the result of identity theft, the collector may request that the consumer fill out an ID theft affidavitAdobe PDF file download (clicking on link will download a PDF file to your computer), report the incident to the police and provide the collector a copy of the report. Additionally, if the debt has been reported, the collector has a duty to mark the account as disputed and notify any CRA that the furnisher has previously reported to that the account is disputed and may be the result of identity theft. The collector may not furnish information to a consumer reporting agency that a consumer has identified as a result of identity theft. Furthermore, under Section 615(f) of the FCRA, no debt may be placed for collection after the date of notification that the debt may be a result of identity theft pursuant to FCRA Section 605B.

This article is provided by ACA International