While there's a law on the books that makes certain practices illegal, debt collection agencies often cross the line anyway. What happens when they do? Unfortunately, most consumers aren't aware of their rights, and so don't challenge debt collectors on their underhanded tactics. In fact, debt collection agencies count on this kind of ignorance.
But, if you're aware of your rights, you know that the Fair Debt Collection Practices Act says that debt collectors who break the law must pay you up to $1,000, along with actual damages and your attorney fees. While it's difficult to generalize, if you want to pursue a claim under the FDCPA, you should first contact a fair debt attorney. Once you have notified a debt collection agency that you have an attorney, debt collectors can no longer contact you, and must communicate directly with your attorney. Attorneys who specialize in fair debt law typically won't charge you for representation, because the lawbreaking debt collector will have to pay for your attorney fees.
Once you have legal representation, your attorney will either file a lawsuit in federal court, contact the debt collection agency, or both. Many times, debt agencies that know they've been caught red-handed will settle out of court, offering a cash settlement or perhaps even to wipe out part or all of the debt owed. If the case does go through the court system, a judge will likely rule in your favor, granting you actual damages, statutory damages up to $1,000, and attorney fees.
If you've been the victim of unfair debt collection practices, you should also file a complaint with the Federal Trade Commission. This is the governmental agency in charge of enforcing the FDCPA. While the Federal Trade Commission doesn't represent individuals, they do track complaints and use complaints in a couple of ways. First, the FTC has to issue an annual report to Congress about debt collection agencies. Second, the FTC uses complaints to look for patterns of abuse. When they see a debt collection agency that regularly crosses the line, the FTC will sue the debt collection agency. Most often, these cases are settled out of court, but the collection agency usually has to pay a hefty fine and has to agree to a number of steps to ensure that they don't break the law in the future.
The bottom line? There are consequences when a debt collector violates the Fair Debt Collection Practices Act. If you've been the victim of abusive tactics, it's important to stand up for your rights, as well as to file a complaint so the federal government can hold debt collectors accountable.