Consumer Law

FDPCA & FCRA Lawsuits On the Rise

By Randall Ryder

The number of FDCPA and FCRA lawsuits filed in 2009 is well ahead of both 2008 and 2007. In July 2009, the 5000th suit was filed. In 2008, that benchmark was not hit until the second week of October; in 2007 it took until early December.

So what is behind the surge? Here are my best guesses.

Consumers are becoming more aware of their rights

The internet is knowledge at your fingertips—and more and more people turn to the internet to research issues before approaching other sources of the law—like lawyers. This makes consumers more aware of their rights and more on the lookout for potential violations.

Debt collectors may be overworked

With the economy in the tank, more and more people are in default on various loan and credit card payments. On top of the that, many people can’t afford to make any payments even after contacted by a debt collector.

If you cannot pay a debt collector, they are likely to keep calling. The more they call, the more likely they are to make a mistake. It is also possible that the volume of debt has forced debt collectors to hire undertrained staff and throw them into the fray before educating them on the various dos and don’ts of debt collection.

FDCPA and FCRA lawsuits may continue to increase

The number of lawsuits has to peak at some point. From a sheer volume standpoint, debt collectors have to lose many of the cases brought against them—and money talks. The more financial damage debt collectors take, the more likely they are to amend any practices in violation of the FDCPA.

FDCPA lawsuits reach a new milestone | InsideARM

(photo: nahkahousu)

Full post as published by Caveat Emptor on September 23, 2009 (boomark / email).