If they are creditors who collect their own debts, they are not doing so. The Fair Debt Collection Practices Act (FDCPA) is the primary federal law governing debt collection practices. The FDCPA prohibits debt collection companies from using abusive, unfair, or deceptive practices to collect debts from you. The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects debtors against abusive tactics of collection by debt collectors.
Congress created the FDCPA to prohibit debt collectors from using unfair, deceptive, or abusive practices when collecting consumer debts. The FDCPA generally only applies to third-party debt collectors, not to original creditors. A creditor is defined as the person or entity that granted you the credit in the first place (the original lender). Any debt collector covered by the FDCPA who contacts you regarding a debt must provide you with certain information about it.
Therefore, business-to-business debt and other forms of business debt do not activate FDCPA protections. The FTC has gone to court to challenge FDCPA violations committed by companies that used other names to collect their own debts. If a creditor is a “debt collector” under the FDCPA, Regulation F applies directly to the creditor and the creditor must comply with Regulation F. However, the FDCPA does not apply to all types of debt; some types are exempt from the provisions of the FDCPA.
The Fair Debt Collection Practices Act (FDCPA) is a federal law that limits what debt collectors can do when they attempt to collect certain types of debts. Therefore, for those accounts, Green Tree donned the extra “debt collector” hat, as mandated by the FDCPA. Creditors must have adequate knowledge of Regulation F to act with due diligence before existing and potential external collection agencies that are subject to the FDCPA and to fulfill their oversight responsibilities. Nearly five years after initiating regulatory initiatives, the Consumer Financial Protection Bureau (“CFPB”) finalized the first and second parts of its debt collection regulations under the federal Fair Debt Collection Practices Act (“FFCPA”).
In addition, the FTC has taken action under Section 5 when first-party creditors engage in other practices that are expressly prohibited by the FDCPA, for example, by disclosing the existence of a debt to anyone other than the debtor. There are nearly countless types of debt in the commercial and consumer world, many of which are not protected by the FDCPA. The FDCPA was designed and implemented with the purpose of addressing the abusive, illegal and deceptive debt collection practices that are proliferating across the country. But what about a debt that is in default? According to the FTC and several federal appellate courts, if the debt was in default when the company obtained it, the company's activities to collect it are covered by the FDCPA.
