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DISCLAIMER: This article is based on a complaint. The defendant has not responded to the complaint to present its side of the case. The claims mentioned are accusations and should be considered as such until and unless proven otherwise.
As has been written about many times over the years on this site, the Fair Debt Collection Practices Act is a strict liability statute that holds collectors responsible, even if they did nothing more than rely on the information that was provided to them by their client. A collection operation is facing claims it violated the FDCPA by attempting to collect a debt from a consumer for a home improvement loan where none of the work was ever performed.
The background: The plaintiff obtained a home improvement loan from a creditor, and $22,500 of that amount was sent to the company performing the work. But the construction company never did any of the work it was hired to do.
- The plaintiff spoke with the creditor, who advised the plaintiff to get a letter from the construction company confirming that none of the work had been done, and then the creditor would zero out the balance owed by the plaintiff. The plaintiff obtained the letter and forwarded it to the creditor.
- But instead of zeroing out the balance, the creditor forwarded the account to the defendant.
- The defendant attempted to collect $47,479.69 from the plaintiff, which included the original $22,500, plus $1,828.20 in interest and a miscellaneous charge of $24,151.47.
- The defendant also allegedly informed the plaintiff that a lien had been placed on the plaintiff’s property and that the lien would not be released until the debt was paid in full.
- The plaintiff, according to the complaint, informed the defendant that the amount that had been borrowed so far was $22,500 and that none of the work had been performed.
- The plaintiff called the defendant a second time and spoke with a representative and a supervisor, and both allegedly informed the plaintiff that the full amount of $47,479.69 was due.
The claims: The complaint accuses the defendant of violating Sections 1692e(2) and1692f(1) of the FDCPA by attempting to collect a debt that it allegedly knew was not legitimate.
- The complaint also accuses the defendant of violating provisions of the Florida Consumer Collection Practices Act.
