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Flashcards in FDCPA Deck (22):
1

What is a debt collector?

Person or entity that uses the telephone, mail, or similar means in any business the principal purpose of which is to collect debts owed to others, or who regularly collects or attempts to collect, debts owed to others.

Someone who collects debt in one of the following categories:
- principal business
- regularly collects debts
- collects debts under a third-party name

2

When is a bank NOT required to comply with the FDCPA?

a. When it uses a name other than its own in the collection of its debts
b. When it uses US mail to contact defaulted loan customers of its correspondent banks
c. When it uses its own name to collect debts of those of affiliated institutions
d. When it collects debts regularly for other institutions under a reciprocity agreement.

c. When it uses its own name to collect debts of those of affiliated institutions

3

A collector for First Collection Company, located in Chicago, makes calls to consumers all over the country. He is responsible for 50 past-due accounts. Each day he begins calling all his accounts on a rotating basis. What time constraints should he follow?

a. He should not call consumers anywhere in the country before 8:00 am Chicago time.
b. He should not call any consumer before 8:00 am at the consumer's location.
c. He should not call any consumer before 9:00 am at the consumer's location
d. He can use any time zone in the continental US as the basis for the time restrictions, and he should not call any consumer before it is 8:00 am in the chosen time zone.

b. He should not call any consumer before 8:00 am at the consumer's location

4

First Collection Company is collecting a debt from Louetta Pierce. Ms. Pierce informs the company that she has hired an attorney to present her. She gives the collector the attorney's name and address. The collector calls the attorney and leaves 3 messages with the attorney's secretary over a 2-day time period. Each time the secretary states that the attorney will call that day. he also sends a letter requesting that the attorney call him 4 days pass and he hears nothing. What can the collector do?

a. He can call Ms. Pierce directly about the debt
b. He must make at least one more attempt to contact the attorney by phone; 3 phone calls over a 2-day time period is not enough
c. He should send a registered letter to the attorney stating that if the attorney does not contact the company, the collector will call Ms. Pierce directly
d. He should visit the attorney in person if the attorney is in the same city.

a. He can call Ms. Pierce directly about the debt

The act provides that the collector may contact the debtor if the attorney does not respond within a reasonable time period. Three phone calls over a 2-day time period to an attorney who is in town, along with a letter that goes unanswered, should represent a reasonable response time. The collector can but is not required to take the extraordinary measures mentioned in the other choices.

5

FDCPA: The consumer must be send debt validation in writing within __ calendar days of initial communication unless information contained in initial communication or unless consumer pays the debt.

5

6

T/F: If a consumer owes multiple debts and makes a single payment, the debt collector must apply to debt in accordance with the consumer's direction.

True

7

T/F: If a consumer disputes a debt in writing within 30 days, all collection activity must stop until the debt is verified.

True

8

Which of the following communications would NOT be considered a deceptive communication under FDCPA?

a. Reporting a disputed debt to a credit bureau without reporting it as disputed.
b. Giving the consumer a disclosure that this is an attempt to collect a debt and any information used will be used for that purpose.
c. Sending the consumer a letter that appears to be a telegram from a debt collection service regarding his or her 3-day-past-due account that requests payment
d. Sending a consumer a letter stating that the account will be sent to an attorney for legal action within 10 days, when no such action is actually intended.

b. Giving the consumer a disclosure that this is an attempt to collect a debt and any information used will be used for that purpose.

A collector must send notice that a debt is disputed at the time of the report. The collector must disclose in the first communication that the debt collector is trying to collect a debt. Using communication formats that misrepresent the nature of the message or convey a false sense of urgency is an abusive practice. Stating that certain remedies will be taken when there is no present intention to do so is a violation of the act.

9

FDCPA prohibits communication with a consumer at an unusual time or place or at a time or place which should be known to be inconvenient, such as before ___ or after ___.

8:00 am
9:00 pm

Can call at other times if the debtor has consented to such contact.

10

A collector at Fist Collection Company has not been able to reach John, a consumer, at home. The collector obtains John's work telephone number and calls him at work. john tells the collector not to call him at work again because personal calls are prohibited by his employer. What should the collector do?

a. Tell John that he must provide such a prohibition in writing before it will be effective
b. Refrain from calling John at work
c. Tell John that calls to him at work will cease if he can be reached at another place
d. Ask John to have his employer's representative call the collector to verify the statement

b. Refrain from calling John at work

If a debt collector knows or has reason to know that the consumer's employer prohibits the consumer receiving communications from the collector at work, the collector must refrain from communicating with the consumer there. A clear statement from the consumer would give the collector the necessary knowledge that such communications are prohibited.

11

To validate a debt, a debt collector must sent a notice that contains:
- The amount of debt
- The name of the creditor to whom the debt is owed
- A statement that, unless the consumer disputes the debt in writing within __ days, the debt will be presumed to be valid
- A statement that if the consumer requests it in writing, the collector will provide, within __ days, the name and address of the original creditor, if different from the current creditor
- A statement that if the consumer notifies the debt collector in writing within __ days that the debt is in dispute, the collector will obtain and provide by mail, verification of the debt for the consumer or a copy of a judgment against the consumer

30
30
30

12

Which of the following activities of First National bank would most likely be covered by the FDCPA?

a. Collection of consumer credit accounts that the bank originated in its consumer lending dept
b. Servicing of mortgage loans originated by First National and sold to investors
c. Servicing of a consumer loan portfolio under contract to an investor who purchased an entire portfolio of consumer loans from a failed bank
d. Collection of consumer credit contracts purchased from auto dealers.

c. Servicing of a consumer loan portfolio under contract to an investor who purchased an entire portfolio of consumer loans from a failed bank

The act excludes collection of a creditor's own debts so the activities of First National's own consumer loan dept would be excluded, as would the action of collecting on dealer paper if the obligation is now owned by the bank. The act also excludes collection of debts originated by the collector; therefore, activities of a bank's mortgage servicing dept would be excluded if the bank originated the loans. First National's loan servicing activities are covered by the act to the extent that the loans were in default when they were obtained. If an investor purchases an entire portfolio of loans, it is likely that some will be in default at the time of purchase and the act will apply to those loans.

13

Is a person who collects their own debts in their own name a debt collector?

No. Officer or employee of the Bank, in the name of the bank, collecting debts for the bank itself, or for the parent company, or for other companies in the holding company.

14

What does FDCPA cover?

Consumer debt.

Applies only to collection of obligations incurred by consumers for personal, family and household purposes.

15

Which of the following is the correct response to consumer written requests that they not be contacted again by debt collectors?

a. Collectors may send final demand letters
b. Collectors may send letters explaining that defaulted obligations are being turned over to attorneys for legal action
c. Collectors may call and ask for verification of requests to cease communications
d. Collectors may send letters that remind debtors of their legal obligations under the credit contracts.

b. Collectors may send letters explaining that defaulted obligations are being turned over to attorneys for legal action.

There are only three times of communication that may be sent to a consumer who has given a written notice to a debt collector to cease communications: (1) that further collection efforts will cease; (2) that the collector may invoke a specific remedy ordinarily invoked by that collector; or (3) that the collector intends to invoke a specific remedy.

16

When may a debt collector communicate with third parties about the consumer?

a. If the consumer has defaulted on the credit obligation
b. To determine the consumer's employment
c. If the collector identifies himself or herself as a debt collector
d. To determine the consumer's location

d. To determine the consumer's location

A debt collector may communicate with third parties about a consumer only to determine the location of the consumer. The debt collector may only identify himself or herself and should not identify his or her employer unless expressly requested to do so.

17

What is the civil liability for violating FDCPA?

$1000 in an individual case and up to the lesser of $500,000 or 1% of the collector's net worth in a class action

18

Which of the following actions is NOT considered abuse or harassment under the FDCPA?

a. Publishing a list of consumers who allegedly refuse to pay debts
b. Using obscene, profane, or abusive language when calling a consumer
c. Providing a toll-free number for the consumer to call to inquire about the debt
d. Calling a consumer every hour on the hour.

c. Providing a toll-free number for the consumer to call to inquire about the debt

19

Under the Fair Debt Collection Practices Act, a debt collector may not:

a. Accept checks that are post dated by more than 1 day
b. Accept post dated checks
c. Solicit a post dated check for payment of a debt for purposes of avoiding additional communications with the debtor
d. Solicit a post dated check for payment of a debt for purposes of threatening criminal prosecution

d. Solicit a post dated check for payment of a debt for purposes of threatening criminal prosecution

20

If a check is postdated longer than __ days, the debt collector, must notify consumer of deposit at least __ days and no more than __ days before depositing.

5
3
10

21

Which of the following actions is most likely to be prohibited under FDCPA?

a. Pursuant to a corporate policy, individual collectors using an alias when contacting consumers
b. Calling a consumer's neighbors to leave messages when the consumer has a telephone
c. Telling a consumer that a lawsuit would cause the consumer inconvenience and embarrassment
d. Referring to the fact that a consumer could be subjected to criminal prosecution for issuing bad checks

b. Calling a consumer's neighbors to leave messages when the consumer has a telephone

A collector can't make unnecessary calls to third parties. Calling a consumer's neighbor and leaving messages when he consumer has a telephone is considered to be harassment. Although a collector may not fail to meaningfully disclose his or her identity, the use of personal aliases as a corporate policy is acceptable provided the collector is not using a false name for the business. Also, stating that a lawsuit will cause embarrassment and inconvenience is not false or misleading. Properly making a reference to criminal prosecution of issuing a bad check is also not abusive provided the offense is one that can be subject to such prosecution.

22

Which of the following actions is allowed under the FDCPA?

a. Sending a communication that loos like a telegram to a consumer by regular mail.
b. Sending a postcard to a consumer asking for payment of the past due balance
c. Accepting certain postdated checks.
d. Requiring consumers to pay collection fees not authorized by the contract when they pay the balance of their accounts.

c. Accepting certain postdated checks.