ACA International, an international trade organization composed of credit and collection companies, recently submitted comments in response to the Federal Trade Commission’s request for comments in advance of its October 10-11, 2007, Debt Collection Workshop. The FTC has scheduled the workshop in order to examine the present state of the debt collection industry and the effectiveness of existing consumer protections relating to debt collection. The FTC intends to examine a number of topics during the workshop, including (i) demographic and industry information (such as the composition and size of the debt collection industry), (ii) debt collection practices and techniques, (iii) industry compliance with, and the sufficiency of, applicable federal and state laws, (iv) consumer behavior and knowledge of consumer rights under the Fair Debt Collection Practices Act and other laws regulating debt collection practices; and (v) legislative issues, including proposed amendments to the FDCPA. In its comments, In addition to responding to requests presented by the FTC regarding these topics, the ACA proposed amending the FDCPA to:

    • Modify liability for noncompliance from that of a strict liability standard to a negligence standard;
    • Relieve a debt collector from liability for unintended or inadvertent communications with third parties;
    • Require a debt collector to disclose the caller’s name, company name or professional name within a message instead of requiring a debt collector to make a “meaningful” disclosure of the caller’s identity when placing a telephone call;
    • Permit a debt collector to communicate with a consumer using those technologies to which the consumer has expressly or impliedly consented;
    • Provide mistake of law and conflicts of law defenses to civil liability;
    • Provide that a prevailing party in an action is entitled to reasonable attorneys’ fees under certain circumstances instead of providing a court with discretion to award such fees;

    Provide that certain restrictions on acquiring location information and communicating with a consumer apply only if the debt collector knows the consumer is represented by a licensed attorney at law instead of an attorney in fact;

    • Provide that a debt collector must wait 30 days, instead of a “reasonable period of time,” before contacting a person for the purpose of acquiring location information about the consumer or contacting the consumer if the debt collector knows the consumer is represented by an attorney at law;
    • Provide that a debt collector may make one additional communication with a consumer for “one or more” (instead of one) of the purposes specified in Section 805(c) if the consumer has notified the debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer;
    • Provide that a debt collector must communicate that a debt has been disputed only if the consumer has disputed such debt “in writing”;
    • Provide that a consumer may prevent a debt collector from assuming a debt is valid only if the consumer disputes the debt within the 30-day validation period “in writing”;
    • Provide optional safe harbor language that a debt collector may use to satisfy the validation of debt notice requirements under Section 809(a)(3)-(5);
    • Permit a debt collector to bring a legal action on a debt in the judicial district or similar legal entity in which the consumer is employed or to which the consumer has reasonably availed himself in addition to other venues permitted by Section 811(a);
    • Provide that no requirement or prohibition may be imposed under state law with respect to any subject matter regulated by the FDCPA; and
    • Require the FTC to regularly evaluate the FDCPA.

    Margaret Stolar and Charles Gall