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Contact: Nate Thompson, Public Relations Specialist

(952) 928–8000, ext. 714, or thompson@acainternational.org


On Nov. 16, 2005, the House Financial Services Committee approved three amendments to the Fair Debt Collection Practices Act (FDCPA) as part of the Financial Services Regulatory Relief Bill (H.R. 3505) as a direct result of the grassroots advocacy work of the members of the association. Two of the three amendments were lifted from the ACA endorsed FDCPA clarification bill from the last Congress, H.R. 3066, which was sponsored by Rep. Scott Garrett (R–N.J.).

Amendment 1: Clarifies a formal pleading does not constitute an initial communication under the FDCPA and does not trigger the need for validation notice disclosures required by the Act.

Amendment 2: Clarifies that notices and forms sent by debt collectors as required by federal or state statutes, regulations or rules, but which do not request payment of a debt, are not deemed communications in connection with debt collection. This amendment addresses potential compliance conflicts that can trigger nuisance FDCPA lawsuits when an agency fulfills the notice requirements of the Gramm Leach Bliley Act, provides a consumer debtor with a Internal Revenue Code form such as the 1099–C, or complies with security breach and data security laws and regulations.

Amendment 3: Clarifies the debt collector's right to collect within the thirty–day validation period. Although the Federal Trade Commission (FTC) and the vast majority of courts have interpreted the Act to permit collection of undisputed debts during the first 30 days, a few misguided court decisions have unduly hampered legitimate collection and payment activities during this 30–day period.

"ACA is very pleased the House Financial Services Committee, at the direction of Chairman Oxley, took a major step forward in endorsing these three common sense changes to the FDCPA. The years our members have spent lobbying for FDCPA reform resulted in a victory today as three of our supported changes to the FDCPA moved forward in the legislative process," said Rozanne Andersen, ACA general counsel and senior vice president for legal and government affairs. "ACA recognizes the approval of these three amendments is just the first step in a very long process before the amendments are passed into law; but commends the Committee for its support and foresight."

At the insistence of many thousands of district attorneys nationwide as well as the check diversion companies, the House Financial Services Committee also approved an amendment to H.R. 3505 exempting check diversion activities from the FDCPA. ACA worked tirelessly to oppose this exemption from the FDCPA. In the weeks leading to markup, ACA and many of its members raised grave concerns about the effect of this exemption, arguing it would create an unlevel playing field for collectors that the FDCPA is specifically intended to prevent. ACA representatives met with many congressional offices and faxed its position paper in opposition to the amendment to every member of the House Financial Services Committee, while ACA members similarly deluged the committee members with faxes and phone calls in opposition to this amendment. In the end, ACA was unable to counter the pressure placed on the House by the lobbying forces of the district attorneys and the check diversion companies.

H.R. 3505 now heads to the House floor for consideration. The Senate Banking Committee is expected to take up its version of the regulatory relief bill early in 2006.

ACA International, the Association of Credit and Collection Professionals, is the comprehensive, knowledge–based resource for success in the credit and collection industry. Founded in 1939, ACA brings together more than 5,500 members worldwide, including third–party collection agencies, attorneys, creditors and vendor affiliates. The association establishes ethical standards, produces a wide variety of products, services and publications, and articulates the value of the credit and collection industry to businesses, policymakers and consumers. For more information about ACA International, visit http://www.acainternational.org.

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