Sunday, December 25, 2011

FTC submits FDCPA report to the Congress- Will the students be safe now?

Contributed by Rick Murphy

S. Paul note:  For so long in this nation's history, we Americans have been told that we needed to become educated in order to compete in a market-based economy.  Little did we realize that an entire student loan-shark scheme was to develop from this push to profit from our desire for self improvement.  Congress has backed the measures of governmental loans and corporate favors for the likes of Fannie Mae and Freddie Mac only to put the screws to those of us who wanted better from this life.  When all is said and done and the piece of paper hangs on our walls collecting dust, this education has only served to put us further into debt while the few profit from another example of this, our American, capitalistic nightmare.

With the spurring personal debt level in the US and the consumers defaulting on their loan obligations, the debt collectors are having their gala time disturbing the consumers, debtors and the defaulted student borrowers and asking them for recuperation of the money that they owe to the debtors. However, the deceptive practices of the debt collectors are getting on the nerves of the debtors and this is the most prominent reason behind the increasing complaints against the debt collectors with the Federal Trade Commission.

 When the students are unable to repay their debt through professional services, they start defaulting on the obligations and their accounts are being henceforth turned down to the collection agencies. But after the FTC submitted its FDCPA report to the Congress, can the students be safer and protected?

During a time when the consumers are troubled with their spurring debt obligations, the FTC has submitted the FTC has submitted the 33rd Annual Report describing the law enforcement of the agency and all the other efforts that are taken to protect the consumers from abusive, deceptive and unfair practices while collecting the debt amounts from the consumers and the students. According to the FDCPA, all kinds of improper behavior and abusive language are disregarded and this act requires the Commission to submit annual reports to the Congress discussing the administration of the FDCPA agency.

The data that is available in the 2011 report shows that the FTC received the highest number of complaints as compared to any other industry. This agency received 142.076 complaints against the debt collection agents in 2010 and this figure was up by 119.630 complaints in 2009. The complaints were broken into different categories. Have a look at some of them.

  • Continuing to contact the debtor even after a cease and desist request – 9.5%
  • Failing to provide a verification of the debts – 12%
  • Communicating with third parties in spite of requests – 12.5%
  • Calling at the employment space of the consumer – 14%
  • Threatening the consumers and using abusive language – 21%
  • Failing to send the required notifications about the account – 26.8%
  • Demanding a larger amount than what is actually owed – 32%
  • Verbally harassing the consumers – 47%

This above mentioned report brought an immediate response from the ACA or the American Credit and Collection Professionals and that they agree with the FTC regarding the importance of consumer protection from the shady debt collectors who often engage in abusive collection practices. Violation of the rules of the FDCPA should be made stricter if there is any hope to be expected for the debtors, especially for the student debtors.

If an investigation reveals an FDCPA violation, how does the FTC react and take steps to stop such activities? The FTC can either file a lawsuit with the help of the personal attorneys in the federal court seeking permanent injunctive relief from the harassing debt collection calls or ask for compensation for the consumers.

The Congress has always taken solid steps to safeguard the right of the consumers and the debtors and after the issuing of the 33rd Annual report of the FDCPA, it is again expected that the Congress, in amalgamation with the FTC will take some more stringent measures to punish those debt collectors who are harassing the students and the normal consumers.

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