Fair Debt Collection Practices Act

The FDCPA (Fair Debt Collection Practices Act) provides consumers with protection from abusive debt collectors. It provides, in part, that consumers may be awarded up to $1,000.00 for a violation of the FDCPA and that the offending party must pay the consumer’s attorney’s fees.    

When you file a Chapter 13 Bankruptcy, your creditors have the right to file a proof of claim in your case. The claim is presumed valid unless a party in interest objects. If you don’t owe the creditor money, the claim is barred by the statute of limitations or the creditor can’t prove they are the owner of the debt they can still receive payments from your case unless someone objects to the claim.

However, a recent 11th Circuit decision may provide further relief for debtors. In Crawford v. LVNV Funding, the 11th Circuit held that FDCPA extends to proofs of claims filed in Chapter 13 cases. This means that creditors filing dubious claims could be subject to the penalties provided in the FDCPA.

This case has been appealed by LVNV Funding and the decision is at odds with other Circuits around the country, so it is not clear if this decision will be followed in Missouri. I will be monitoring this case, and will let you know of any developments.