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Debt collector refuses to supply validation. What next?

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It's been a while since I've been on this wonderful site. I ran into a problem with a family member. Here is the run down:

 

1. A validation request was sent after the initial 30 day period. CA entry popped up on credit report.

 

2. CA responds by saying they do not have to abide by the request because it was requested after the 30-day period. "We will continue to report to bureaus...."

 

I was shocked, to say the least of their response. As a consumer, are we not able to request validation at anytime, regardless of when we ask? This CA is not even licensed in the state. And, you would think they would gladly supply the info to avoid any legal ramifications.

 

Again, it's been a while for me and the "DV" section of this site speaks only of the "initial 30-day period", unless I missed something. Sorry If I did overlook it. :)

 

I think this CA is begging for an "ITS" letter but I need some guidance before we jump the gun.

 

Thanks in advance!

 

 

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It's been a while since I've been on this wonderful site. I ran into a problem with a family member. Here is the run down:

 

1. A validation request was sent after the initial 30 day period. CA entry popped up on credit report.

 

The thirty day period does not start when the negative entry appears on the credit report.  It starts when the consumer receives an initial debt collection letter in the mail containing a particular notice.

 

2. CA responds by saying they do not have to abide by the request because it was requested after the 30-day period. "We will continue to report to bureaus...."

 

Debt validation refers to the FDCPA, not the FCRA.  It is somewhat unclear if the CA furnishing information to the CRA (per the FCRA) would be applicable under the FDCPA.

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First and foremost is your relative in Texas?  If so then there are a few more options as a Texas resident if not then the answer is different.

 

I was shocked, to say the least of their response. As a consumer, are we not able to request validation at anytime, regardless of when we ask? 

 

Of course you can but absent a few states that have strong consumer laws once that initial 30 day dispute period lapses they no longer have to cease collection activity until they do respond to the request.  In Texas there are additional laws that are more stringent that the FDCPA BUT you must invoke that state law when you send the DV letter.  If your relative is in TX then they have to send the DV letter again invoking that law.  

 

This CA is not even licensed in the state. And, you would think they would gladly supply the info to avoid any legal ramifications.

 

They may not be required to be licensed and even if they are they are not required to show you proof under the FDCPA or TX state law unless a court compels them to.  Also did you send the "sample letter" from this site and the internet with this laundry list of demands:

  • What the money you say I owe is for;
  • Explain and show me how you calculated what you say I owe;
  • Provide me with copies of any papers that show I agreed to pay what you say I owe;
  • Prove the Statute of Limitations has not expired on this account;
  • Show me that you are licensed to collect in my state; and
  • Provide me with your license numbers and Registered Agent.

 

If so then they are free to ignore that portion of your DV without fear of "legal ramifications" because ALL of that is not required by state or Federal law.

 

1. A validation request was sent after the initial 30 day period. CA entry popped up on credit report.

 

2. CA responds by saying they do not have to abide by the request because it was requested after the 30-day period. "We will continue to report to bureaus...."

 

The DV was sent AFTER the 30 day period elapsed therefore they are NOT required to stop reporting.  The courts are divided on whether reporting the trade line is collection activity and until the Supreme Court makes a definitive ruling the chances of prevailing on that depend heavily on what federal district you are in.

 

I think this CA is begging for an "ITS" letter but I need some guidance before we jump the gun.

 

I think you are jumping the gun.  If your relative is a TX resident send a short simple DV letter invoking the TX consumer laws and wait for the response.  I do not believe even TX law says that they must stop reporting to the bureaus.  If they are not licensed that is between them and the state of Texas.  You cannot enforce that but I find that the majority of the time the consumer didn't look in the right place and the CA actually is licensed.  

 

If any lawsuit is to be filed than a consumer attorney will take it on contingency.  I recommend you do this because first you cannot represent your family member if you are not a lawyer and second, if you get it wrong your relative could end up paying their attorney fees and expenses for defending a frivolous suit.

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Thanks for the response. I understand about the "30-day" rule. My point is that the CA is stating that they don't have to "validate" because it wasn't not requested after their letter was sent.

 

As far as CRA issues, I was under the understanding that without proper validation of a debt, CA cannot report debts to the bureaus.

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Relative is in Indiana. Is there a link that lists CAs licensed there? Texas' SOS site has an easy way to locate licensed/bonded CAs.

 

Point well taken.

 

So let me get this straight, Even though we requested validation, they do not have to provide it, per FDCPA?

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CLICK ON THE LINK IN MY SIG LINE BELOW! The one that says Texas thread and read the info there. If the collection company is in Texas or the people are in Texas all you have to do is cite the Texas TFC 392 in their letter telling them that under Texas law they MUST respond at anytime there is a DV. I think I have a sample letter regarding this. Have them Google and read TFC-392.

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Thanks for the response. I understand about the "30-day" rule. My point is that the CA is stating that they don't have to "validate" because it wasn't not requested after their letter was sent.

 

I am not sure what this means due to the triple negative but since the DV was sent AFTER the 30 day period to dispute that is allowed under FDCPA had expired the CA does not have to validate, that is correct.  

 

I was under the understanding that without proper validation of a debt, CA cannot report debts to the bureaus.

 

Your understanding is completely wrong.  Validation with the consumer has ZERO to due with reporting to the bureaus.  Even if it did your relative let the 30 days for disputing expire before doing anything.

 

Relative is in Indiana. Is there a link that lists CAs licensed there? Texas' SOS site has an easy way to locate licensed/bonded CAs.

 

VERY few states require that CAs be licensed.  IN does and has a database.  

 

So let me get this straight, Even though we requested validation, they do not have to provide it, per FDCPA?

 

They never HAVE to respond.  They do have to cease collection activity until they do IF you dispute in the first 30 days after getting the collection letter or call.  In this situation you posted about once the 30 days lapsed they don't have to respond but they can also continue collection activity.

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So let me get this straight, Even though we requested validation, they do not have to provide it, per FDCPA?

 

@Clydesmom has it correct.  But I'll clarify my previous statement I deleted.

 

There is no obligation for the debt collector to validate at all. 

 

However, the debt collector must stop debt collection activities until it validates the debt, provided the consumer requests the validation within the thirty day time period, starting when the consumer receives the initial debt collection letter with the appropriate notice, according to the FDCPA.

 

However, state law may say otherwise, and may even provide stronger protections.

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This is off my TX thread, edit to suit you. If you are a TX resident or the creditor is based out of TX they must comply.

For those using the TFC-392, the following example may help in composing your letter:

As I am Texas resident, I will be using Texas Finance Code 392.202 to backup my dispute and I suggest that you adhere to its provisions. I will not hesitate to act if you disregard my rights or violate the Texas Laws you are required to respect. You have 30 days from your receipt of this tracked letter to validate this alleged debt. If you cannot or will not validate this account properly in 30 days, Texas Finance Code 392.202(d) requires any trade lines associated with this alleged debt must be deleted from any and all credit reports/reporting bureaus you may do business with. You are not to sell, transfer, assign, or share any information about me, or this alleged debt with anyone else.

I am reasonably certain that your staff is aware of the current position of many courts that continuing to report a trade line is viewed as continuing collection activities. I am also reasonably certain that your staff is aware of the requirements of the Texas Finance Code pertaining to the reporting of matters that are disputed. In particular, I would again point you in the direction of Section 392.202 which references the duties of the collector upon notification of the matter being in dispute.

Nothing in this letter authorizes a hard pull or a soft pull of my credit information. The account number you have reported to a credit bureau is included and should provide you with sufficient information with which to identify me in your existing records. There should be no basis for you to request additional information from me in the validation process. It is not incumbent upon me, as the injured party, to build your files for you, nor should I pay a penalty in the form of failure to procure credit from existing or new lenders and bear a negative impact on credit scores for your attempts to reconstruct records which you should already have possessed prior to making any claim. If such retrieval is discovered to have occurred, it will be evaluated for action as a non-permissible access of the report as well as retaliatory actions for the exercise of rights provided to me as a consumer under Texas law.

Be advised you are hereby put on the 60 day notice of "right to cure" as allowed under the Texas Business and Commerce Code (BCC17). In addition to the reporting requirements incumbent upon third-party entities, Texas law also contains a bonding requirement. A search of the list of bonded agencies provided to me by the Legal Support Unit/Statutory Documents Section of the Secretary of State did support that a bond was in place at the time your office claims to have reported the file. Records reflect that the bond is underwritten by Bond Underwriter Company (policy number xxxxxxxxxxxx) and involvement of their claims personnel has been held in abeyance pending your compliance with the issues in this letter.

Failure to timely and fully validate this alleged debt will result in an actionable offense(s) under Texas state law, in which damages will also be sought under § 17.41 Deceptive Trade Practices-Consumer Protection Act of the Business and Commerce Code (BCC17). Those damages are subject under Texas law to a trebling upon a showing of gross negligence. Should legal action be necessary, venue shall reside in Dallas County, Texas. Upon a favorable finding in the Dallas County courts, claim will be made against the bond. There are no federal questions being raised in this matter and any attempt to remove an action to Federal Court will be challenged.

This document is also to serve as notice that the only form of correspondence I am willing to receive from your business is through the written communication at the address listed below. Telephone calls to my home or place of employment are inconvenient. I retain the right to use this correspondence and all following communications in any court proceedings arising in regard to this account.

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So, after researching the rights (to collect/validate) on IN.gov, this CA is NOT licensed in the state of Indiana.

 

That doesn't surprise me, considering the 2 responses they sent.

 

Where do we go from here?

 

Thanks in advance.

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Maybe filing a complaint could help...

 

 

AZ requires debt collectors to be licensed. I've helped the state get over $10k in civil penalties for unlicensed collection. Usually they will then drop collection efforts against you.

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@1stStep....Thank You!

 

Who should I file a complaint with? Should I send a letter to the CA stating "they are not licensed in the state" as well?

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The Arizona Dept of Financial Institutions regulates collection agencies here.

 

 

I'd start at the Attorney General's Office - either they regulate or can give you the correct agency.

 

 

 

I have sent letters and enclosed copies of my complaints in the past... that way, they know who was instrumental in getting them fined.

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@1stStep....Thank You!

 

Who should I file a complaint with? Should I send a letter to the CA stating "they are not licensed in the state" as well?

 

Your relative has to do this.  You are not the consumer involved and the CA cannot communicate with you.  I know you are trying to help but this is THEIR battle and they have to fight it.

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I am completely confused!!! What am I missing?  This post says a ca can continue to report with cra after not validating.  That is in direct conflict with the flowchart and also what I copied and pasted below about validating a debt.


If a creditor can't validate a debt:


  • They are not allowed to collect the debt,
  • They are not allowed to contact you about the debt, and
  • They are also not allowed to report it under the Fair Credit Reporting Act (FCRA). Doing so is a violation of the FCRA, and the FCRA states that you can sue for $1,000 in damages for any violation of the Act.

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I am completely confused!!! What am I missing?  

 

The fact that the DV was sent AFTER the initial 30 day period.  If it is sent after the 30 days expires the CA does not have to cease collection activities until they do validate.  That is only if the dispute is within the 30 days after initial contact.  Your relative waited TOO long to dispute the debt.  The CA can continue collection efforts without validating.  That includes reporting the debt.  The CA even explained in their response letter that the 30 day period had elapsed and under the FDCPA they do not have to validate to continue their efforts.  

 

  • They are also not allowed to report it under the Fair Credit Reporting Act (FCRA). Doing so is a violation of the FCRA, and the FCRA states that you can sue for $1,000 in damages for any violation of the Act

 

I do not know where you got this list but this statement is WRONG.  If the trade line is already reporting they are not required to delete it.  As I explained above: 

 

The courts are divided on whether reporting the trade line is collection activity and until the Supreme Court makes a definitive ruling the chances of prevailing on that depend heavily on what federal district you are in.

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I am completely confused!!! What am I missing?  This post says a ca can continue to report with cra after not validating.  That is in direct conflict with the flowchart and also what I copied and pasted below about validating a debt.

If a creditor can't validate a debt:

  • They are not allowed to collect the debt,
  • They are not allowed to contact you about the debt, and
  • They are also not allowed to report it under the Fair Credit Reporting Act (FCRA). Doing so is a violation of the FCRA, and the FCRA states that you can sue for $1,000 in damages for any violation of the Act.

 

 

The creditor doesn't have to validate, period.  None of these things that you've 'copied & pasted' here, apply to the creditor.  These only apply to 3rd party collection agencies.  I would like to think that is what you meant to say, but in dealing with laws and violations, you need to be sure and use the correct terminology.

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