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The Federal Trade Commission (FTC) is an independent government agency that promotes and enforces a variety of consumer protection and antitrust laws.
- It was originally established in 1914 by Woodrow Wilson in an effort to break up near-monopolies that had come to dominate the American consumer market in the early 20th century.
- Since then, the agency has grown to encompass a number of other important regulatory duties, as well.
In 1977, the FTC adopted the Fair Debt Collection Practices Act (FDCPA) to establish rules to prohibit collectors from using “abusive, unfair or deceptive practices” to collect money from debtors.
- The FDCPA applies to personal debts, including auto loans, medical bills, mortgages and credit card debts, but do not apply to business debts.
- In 2010, following the subprime mortgage crisis of 2007, the act was amended to include additional protections for consumers, as well.
So what constitutes an abusive, unfair or deceptive practice under the FDCPA?
Under the terms of the FDCPA, debt collectors cannot “harass” consumers by calling them repeatedly, threatening them with violence, using obscene language or publishing the names of debtors in a public forum.
They are also forbidden from pretending to be someone they’re not, such as an attorney or government official. Furthermore, they cannot misrepresent the amount of money that is owed, or threaten debtors with arrest and other forms of legal action.
How can you stay compliant with the FDCPA?
While agent training on best practices for communicating with consumers is vital to remaining FDCPA compliant, utilization of a collections platform with dynamic compliance breach prevention is a necessity to avoid human error.
By implementing a system that dynamically tracks all Federal, State, and Local rules and regulations and actively prevents agents from performing non-compliant actions, you are effectively protecting your company while reducing resources normally necessary to maintain optimal compliance on all fronts.
Click here for more information on leveraging the power of technology to protect your business or contact CSS for your free demo consultation.