Answer:
Answer by Jim Bedsole
You are correct that the Fair Debt Collection Practices Act excludes from its coverage those collecting their own debts. Many states, however, have adopted similar statutes offering protection from overzealous collection efforts and many of these state statutes also apply to lenders collecting their own debts.
Not sure about your "Miranda" reference as it relates to FDCPA. The only thing I know of is the requirement for police officers to read a person their rights upon arrest that is cited as "Miranda" rights based on a Supreme Court case involving an arresteee named Miranda.
Answer:
Answer by Mary Beth Guard
BOL user Melody Charlton responded to the part of the question that relates to a "Miranda warning" under the FDCPA. Melody notes that Section 807(11) of the FDCPA (15 USCsection 1692e(11)) is the socalled "Miranda" warning provision. It states "This is anattempt to collect a debt and any information obtained will be used forthat purpose."
There is a requirement under Section 809(a) of the FDCPA that reads as follows:
"(a) Within five days after the initial communication with a consumer in connection with the collection of any debt, a debt collector shall, unless the following information is contained in the initial communication or the consumer has paid the debt, send the consumer a written notice containing
(1) the amount of the debt;
(2) the name of the creditor to whom the debt is owed;
(3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;
(4) a statement that if the consumer notifies the debt collector in writing within the thirtyday period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and
(5) a statement that, upon the consumer's written request within the thirtyday period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor."
As Jim noted, the FDCPA is not directly applicable to lenders when they are collecting their own debts in their own name. Since the Act sets forth best practices, however, it provides a wise set of guidelines to voluntarily follow.
First published on BankersOnline.com 2/4/02
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