FAIR DEBT COLLECTION PRACTICES

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WHAT TO DO AND NOT DO WHEN COLLECTING. YOUR DEBT. Karel Rocha, . Esq., Partner. Thomas Prenovost, Partner. Prenovost, Normandin, Bergh & Dawe. 2122 N. Broadway, Suite 200. Santa Ana, CA 92706. (714) . ID: 776460 Download Presentation

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FAIR DEBT COLLECTION PRACTICES




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Presentations text content in FAIR DEBT COLLECTION PRACTICES

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FAIR DEBTCOLLECTION PRACTICES

WHAT TO DO AND NOT DO WHEN COLLECTING

YOUR DEBT

Karel Rocha,

Esq., Partner

Thomas Prenovost, Partner

Prenovost, Normandin, Bergh & Dawe

2122 N. Broadway, Suite 200

Santa Ana, CA 92706

(714)

547-2444 ~

www.pnbd.com

2019

Update

Slide2

About the Materials

These program materials are intended to supplement discussion at the seminar. Although every effort has been made to ensure these materials are accurate, current, and reasonably thorough, they are not designed to be used independent of the seminar, to present an independent, thorough treatment of the subject, or to take the place of legal advice.

 

Not Legal Advice

Great effort has been made to ensure that the information provided during this program is accurate, current, and reasonably thorough.

 

However, attorneys provide legal advice to clients based on a variety of factors, including, but not limited to, applicable law, the facts and circumstances of the case, the client's tolerance for risk and for legal expenses, and the attorney's opinions or beliefs concerning whether the court that would hear the particular case is likely to be easily convinced of the attorney's analysis of the law or is likely to be difficult to convince. All of these issues must be considered, and many may change periodically as courts interpret the applicable law. This program is intended to provide only a portion of that information.

As a result, participants should use this seminar as an opportunity to learn about applicable laws and possible strategies, but should always consult with an attorney who is familiar with the exact facts of the specific case taking a course of action. Participants should recognize that fact situations and examples discussed during this seminar are included for illustrative purposes, and are not intended to provide specific advice concerning how any particular credit union should act under any particular circumstances.

 

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Litigation Trends2018

FDCPA

complaints are at their lowest point since 2008, when there were 6117 lawsuits

.

13.2% reduction over 2017

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Litigation Trends

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Litigation Trends

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Litigation Trends

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2019 Cases

Obduskey v. McCarthy

Holthus

(US Supreme Court Case

)

3/20/2019 – US Supreme Court rules unanimously that a business engaged in

non-judicial foreclosure

is NOT subject to all the requirements and prohibitions applicable to debt collectors

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2018 Cases

Tepper

v. Amos Fin., LLC (3

rd

Circuit)

Debt

buyers (i.e., entities collecting, on their own behalf, consumer debts they acquired when the debts were in default),

CAN

qualify as "debt collectors" under the Fair Debt Collection Practices Act (FDCPA)

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2017 Cases

Green v. Specialized Loan Servicing (11

th

Circuit)

Court rejected a consumer’s claim that his monthly mortgage statement constituted an “attempt to collect a debt”

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2017 Cases

Henson v. Santander

On June 12, 2017, the Supreme Court held that a company may collect debts that it purchased for its own account

without

triggering the statutory definition of “debt collector” within the Fair Debt Collection Practices Act.

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2017 Cases

Midland Funding v. Johnson

On May 15, 2017, the Supreme Court held that a creditor’s proof of claim that made clear that the statute of limitations to collect the debt had run was not “false, deceptive, or misleading” and did not use any “unfair or unconscionable means” to collect a debt under the Fair Debt Collection Practices Act (the “Act”).

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Arbitration Agreements

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CA Statutory Update

Debt collectors must provide notice when collecting on time barred debt

CCP 337 amended to prohibit lawsuits that would be past the statute of limitations

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CA Statutory Update

If the debt collector may still report the debt, then the debt collector must send the following notice:

The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it. If you do not pay the debt, [name of debt collector] may [continue to] report it to the credit reporting agencies as unpaid for as long as the law permits this reporting

.

If the debt is too old to be reported, then the debt collector must send the following notice:

The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it, and we will not report it to any credit reporting agency.

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CA Statutory Update

In either case, the statement must appear in the first written communication (including email or fax) that the debt collector sends to the debtor after the debt becomes time-barred.

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Laws Apply To Consumer Debts

a. What is a “Consumer Debt”

Debt incurred

by an individual primarily for a personal, family, or household purposes

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Laws Apply To “Debt Collectors”

 

a. Debt Collector Activity Regulated

  b. FDCPA Definition

c. Rosenthal Definition

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Prohibited Conduct Under FDCPA and Rosenthal Act

The FDCPA and Rosenthal both prohibit certain types of "abusive and deceptive" conduct when attempting to collect debts, including the following:

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Contacting Debtors At Inconvenient

Or Prohibited Times

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Failure To Cease Communication

Upon Written Request

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Telephone “Harassment”

Identification of Caller

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Contact At Debtor’s Employer

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Contact With Represented Debtor: 

Different Debts

Communication with consumer’s attorney distinguished

Non-lawyer with Power of Attorney Distinguished

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Debt Validation Violation:

PRACTICE POINTER:

While the Rosenthal Act generally incorporates the Federal

FDCPA requirements, Civil Code 1788.17 exempts original

creditors

from complying with the debt validation requirements and also exempts those creditors from having to identify themselves as “debt collectors.”

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Misrepresentation or Deceit

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Collection of Incorrect Or Improper Amounts

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Improper Threats

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Debtor Abuse

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Third Party Communications

 

Location Information Allowed 

Third Party Communications Where Debtor Represented By Attorney

Voicemail Messages Not Recommended

Employment Verification Allowed

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False or Misleading

Debt Reporting

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Proper

Venue

For Lawsuits

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Threats of Imprisonment or Property Seizure

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Improper Application of Payments Received

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Penalties For Violations

 

a. Actual Damages

b. Statutory Damages  

c. Incorporation of Federal FDCPA

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Attorney Fees and Costs

 

Prevailing debtor fees 

Prevailing creditor's fees

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Defenses to Liability

 

a. Curing the violation 

b. Proof of Unintentional Violation

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CONTACT US!

Karel Rocha, Esq

.

Tom Prenovost, Esq.

(714) 547-2444

krocha@pnbd.com


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