Federal Debt Collection Law Industry Guidelines

Because of federal debt collection lawrules, collection agencies are examining their processes in addressing the abuses that sometimes happen in the industry. While debt collections harassment laws are clearly spelled out in The Fair Debt Collection Protection Act, and as most collection agencies operate within these guidelines, violations do occur, such that collection agencies are monitoring themselves and taking serious steps to curtail these abuses.

Here are some parameters and guidelines that many have adopted. When looking to hire a third party collection agency for your business, you should make sure they operate within these (and other) guidelines:

• Stop collection activities immediately upon receiving a written request from a consumer asking for verification of a debt.
• Communicate with consumers clearly, honestly and respectfully. Abusive, demeaning, condescending, or any threatening and harassing language is not allowed, as it violates both federal and state debt collections law.
  In addition, as an extension of your business, you risk damaging your reputation by working with an agency accused of these practices.
• Verify the debt by conducting a reasonable investigation, clearly identify the person obligated to pay the debt, and verify the accuracy of the information provided by the original creditor to the debt collector.
• Federal debt collection law forbides collection agencies from threatening legal action on debts where the statute of limitations have expired. Consumers should know their state's laws on debts and statutes of limitations, and are fully within their legal rights to challenge these threats.
• Collection agencies must make reasonable efforts to safeguard the integrity, privacy and availability of consumer information.
• A debt recovery agency shouldn't engage in conduct that is unprofessional, unethical, illegal, deceitful or dishonest.

Get familiar with more federal debt collection guidelines covered by the Fair Debt Collection Protection Act, or FDCPA.

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