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Four Potential Steps to Take in California against a Creditor Violating Fair Debt Collection Law

File a complaintMy last blog post was about what creditors and collection agents are allowed and are not allowed to do under the federal and California Fair Debt Collection Practices Acts. There is no doubt that some debt collectors violate these laws.

WHAT CAN YOU DO ABOUT IT IF CREDITORS OR COLLECTION AGENTS VIOLATE THE LAW?

You can take action in one or more of four ways:

1. File a complaint with the California Attorney General's Public Inquiry Unit, for violations of the California Fair Debt Collection Practices Act (CFDCPA).

2. File a complaint with the Federal Trade Commission, for violations of the federal Fair Debt Collection Practices Act (FDCPA).

3. File a complaint with, or just tell your story to, the federal Consumer Financial Protection Bureau.

4. Sue the creditor or collection agent for violations of either or both Acts.

HOW DO I FILE A COMPLAINT WITH THE CALIFORNIA ATTORNEY GENERAL?

The Attorney General's website has a simple one-page online "Consumer Complaint Against a Business/Company," which can be submitted online, or by mail if you have copies of documents you'd like to attach. The mailing address is:

Attorney General's Office

California Department of Justice

Attn: Public Inquiry Unit

P.O. Box 944255

Sacramento, CA 94244-2550

This Public Inquiry Unit's phone numbers are:

Voice: (916) 322-3360 or (800) 952-5225 (toll-free in California)

Fax: (916) 323-5341

WHAT HAPPENS TO MY COMPLAINT AFTER IT'S SENT TO THE ATTORNEY GENERAL?

Candidly, filing a complaint here is probably more of an act of public service on your part than a way to remedy your specific problem. The Office of the Attorney General has very limited resources. The best it will likely do is stated on its website page on collection agencies:

If the information you provide indicates that the collection agency has violated the law, we may contact the collection agency and send them a copy of your complaint. Although this may elicit a positive outcome, please be aware that some types of complaints (such as telephone threats or the use of abusive language by collectors) are very difficult to prove.

So the state attorney general's staff does not go after creditors and collection agencies for violation of the CFDCPA. Its website's "Protecting Consumers" page makes clear, "you must pursue remedies in your private dispute on your own. The Attorney General cannot provide you with legal advice or represent you in personal legal actions."

HOW ABOUT FILING A COMPLAINT WITH THE FEDERAL TRADE COMMISSION?

The FTC has a much more detailed, multiple-page online complaint-filing procedure. Its "Complaint Assistant" is oriented specifically for debt collection issues. Click on "Credit and Debt," then on "Debt," and then complete the comprehensive information form.

WILL THE FTC HELP ME ANY MORE DIRECTLY THAN THE CALIFORNIA ATTORNEY GENERAL?

It, too, is oriented towards broader legal enforcement efforts than following up on individual complaints. It responds to its own question, "What You Can Expect From Us," as follows:

Your complaint may help us and our law enforcement partners detect patterns of fraud and abuse, which may lead to investigations and eliminate unfair business practices. The FTC enters complaints into the Consumer Sentinel Network, a secure, online database available to many civil and criminal law enforcement agencies in the U.S. and abroad. The FTC cannot resolve individual complaints, but we can provide information about what next steps to take.

The FTC may also be reached by mail at Consumer Response Center, Washington, DC 20580-0001 or by phone at (877)-FTC-HELP

WHAT ABOUT THE CONSUMER FINANCIAL PROTECTION BUREAU?

You may get referred to the Consumer Financial Protection Bureau's complaint option from the FTC's Complaint Assistant, or can go there directly. This independent federal agency focuses directly on financial products and services, unlike both the California Attorney General's office and the Federal Trade Commission which deal with virtually the entire world of consumer abuses. It is quite a new agency—a watchdog of the financial services industry formed in 2011 out of the financial turmoil of the Great Recession—and a relatively aggressive one very much still feeling its way to its legal mandate.

So its complaint response effectiveness is relatively untested. But on the surface at least it seems more on-the-ball than the other two agencies. It responds to its own question, "What happens after I submit a complaint?," as follows:

We'll forward your complaint to the company and work to get a response. After we forward your complaint, the company has 15 days to respond to you and the CFPB. Companies are expected to close all but the most complicated complaints within 60 days.

You'll be able to review the response and give us feedback. If we find that another agency would be better able to assist, we will forward your complaint and let you know.

The Consumer Financial Protection Bureau also gives you the option to not file a complaint but just "Tell your story." And to do so anonymously if you wish. The purpose: to vent, and to "help inform how we work to protect consumers and create a fairer marketplace."

Its toll-free phone number is 855-411-2372.

SO TO GET DIRECT, HANDS-ON HELP, DO I NEED TO SEE AN ATTORNEY?

On its website the California Office of the Attorney General says it sensibly:

If the information provided above [about debt collection] does not sufficiently respond to your questions, we suggest you consult a private attorney. An attorney would directly represent your interests and is the one whose advice would be most helpful to you.

So you may need to sue your creditor or collector in court. Both the federal and California debt collection laws provide some practical help in such a private lawsuit. For example, under CFDCPA if you establish that the creditor or debt collector violated the law, you can recover actual damages you incurred as a result of the violation, including potential emotional damages. Also, if the creditor or debt collector acted "willfully and knowingly," a court must award you an additional $100 to $1,000 in "statutory damages." Finally, and of perhaps the greatest practical importance, the court must also require the creditor to pay your attorney's fees.

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