What Constitutes Legal Verification of a Debt

My question involves collection proceedings in the State of: Michigan
(Though I am a current legal resident of the state of Florida)

I was contacted by a debt buyer from Indiana about a delinquent credit card account. They stated that I owed $8,000.

I sent a request for verification letter. I received no response from that debt buyer, however I did get a letter from an attorney's office in Michigan (where I am originally from) requesting that I make voluntary payments.

I sent the Michigan Law Firm a letter also requesting verification of my debt. They sent me a statement from the legal desk supervisor of debt buyer in Indiana.

This statement was sworn to a notary and states that the Legal Desk Supervisor says he has knowledge that I owe the $8,000 they claim, and that the debt buyer keeps regular books and records. And that these books and records show that I owe the amount stated.

My question is this: Does this letter actually satisfy the requirement that I owe the debt they state?

And since they "keep regular books and records" and I requested an account history showing how they arrived at the amount claimed, if they truly had this documentation wouldn't they have provided it to me?

If this letter isn't proof, how do I go about countering their claim that it is, and would I re-state my request for verification?

Thanks in advance for your time and assistance.

No. The debt buyer is a debt collector and did not have knowledge of the account before it went delinquent, so he cannot possibly have knowledge of the account. His testimony is hearsay.

The FDCPA states that they must obtain verification from the creditor, not from another debt collector.

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§ 809. Validation of debts

(a) Within five days after the initial communication with a consumer in connection with the collection of any debt, a debt collector shall, unless the following information is contained in the initial communication or the consumer has paid the debt, send the consumer a written notice containing—

(1) the amount of the debt;

(2) the name of the creditor to whom the debt is owed;

(3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;

(4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and

(5) a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

(b) If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original credi- tor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector. Collection activities and communications that do not otherwise violate this title may continue during the 30-day period referred to in subsection (a) unless the consumer has notified the debt collector in writing that the debt, or any portion of the debt, is disputed or that the consumer requests the name and address of the original creditor. Any collection activities and communication during the 30-day period may not overshadow or be inconsistent with the disclosure of the consumer’s right to dispute the debt or request the name and address of the original creditor.

(c) The failure of a consumer to dispute the validity of a debt under this section may not be construed by any court as an admission of liability by the consumer.

(d) A communication in the form of a formal pleading in a civil action shall not be treated as an initial communication for purposes of subsection (a).

(e) The sending or delivery of any form or notice which does not relate to the collection of a debt and is expressly required by the Internal Revenue Code of 1986, title V of Gramm-Leach-Bliley Act, or any provision of Federal or State law relating to notice of data security breach or privacy, or any regulation prescribed under any such provision of law, shall not be treated as an initial communication in connection with debt collection for purposes of this section.

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take note of section a. The requirements are very minimal and most likely included in the original letter.

If they have failed to follow the that section of the FDCPA , this section comes in to play, which describes the possible civil liabilities incurred by the collectors:

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§ 813. Civil liability

(a) Except as otherwise provided by this section, any debt collector who fails to comply with any provision of this title with respect to any person is liable to such person in an amount equal to the sum of—

(1) any actual damage sustained by such person as a result of such failure;

(2) (A) in the case of any action by an individual, such additional damages as the court may allow, but not exceeding $1,000; or

(B) in the case of a class action,

(i) such amount for each named plaintiff as could be recovered under subparagraph (A), and

(ii) such amount as the court may allow for all other class members, without regard to a minimum individual recovery, not to exceed the lesser of $500,000 or 1 per centum of the net worth of the debt collector; and

(3) in the case of any successful action to enforce the foregoing liability, the costs of the action, together with a reasonable attorney’s fee as determined by the court.

On a finding by the court that an action under this section was brought in bad faith and for the purpose of harassment, the court may award to the defendant attorney’s fees reasonable in relation to the work expended and costs.

(b) In determining the amount of liability in any action under subsection (a), the court shall consider, among other relevant factors—

(1) in any individual action under subsection (a)(2)(A), the frequency and persistence of noncompliance by the debt collector, the nature of such noncompliance, and the extent to which such noncompliance was intentional; or

(2) in any class action under subsection (a)(2)(B), the frequency and persistence of noncompliance by the debt collector, the nature of such noncompliance, the resources of the debt collector, the number of persons adversely affected, and the extent to which the debt collector’s noncompliance was intentional.

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and as administrative liability, this section:

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§ 814. Administrative enforcement

(a) Compliance with this title shall be enforced by the Commission, except to the extent that enforcement of the requirements imposed under this title is specifically committed to another agency under subsection (b). For purpose of the exercise by the Commission of its functions and powers under the Federal Trade Commission Act, a violation of this title shall be deemed an unfair or deceptive act or practice in violation of that Act. All of the functions and powers of the Commission under the Federal Trade Commission Act are available to the Commission to enforce compliance by any person with this title, irrespective of whether that person is engaged in commerce or meets any other jurisdictional tests in the Federal Trade Commission Act, including the power to enforce the provisions of this title in the same manner as if the violation had been a violation of a Federal Trade Commission trade regulation rule.

(b) Compliance with any requirements imposed under this title shall be enforced under—

(1) section 8 of the Federal Deposit Insurance Act, in the case of—

(A) national banks, by the Comptroller of the Currency;

(B) member banks of the Federal Reserve System (other than national banks), by the Federal Reserve Board; and

(C) banks the deposits or accounts of which are insured by the Federal Deposit Insurance Corporation (other than members of the Federal Reserve System), by the Board of Directors of the Federal Deposit Insurance Corporation;

(2) section 5(d) of the Home Owners Loan Act of 1933, section 407 of the National Housing Act, and sections 6(i) and 17 of the Federal Home Loan Bank Act, by the Federal Home Loan Bank Board (acting directing or through the Federal Savings and Loan Insurance Corporation), in the case of any institution subject to any of those provisions;

(3) the Federal Credit Union Act, by the Administrator of the National Credit Union Administration with respect to any Federal credit union;

(4) subtitle IV of Title 49, by the Interstate Commerce Commission with respect to any common carrier subject to such subtitle;

(5) the Federal Aviation Act of 1958, by the Secretary of Transportation with respect to any air carrier or any foreign air carrier subject to that Act; and

(6) the Packers and Stockyards Act, 1921 (except as provided in section 406 of that Act), by the Secretary of Agriculture with respect to any activities subject to that Act.

(c) For the purpose of the exercise by any agency referred to in subsection (b) of its powers under any Act referred to in that subsection, a violation of any requirement imposed under this title shall be deemed to be a violation of a requirement imposed under that Act. In addition to its

§ 814 15 USC 1692l powers under any provision of law specifically referred to in subsection (b), each of the agencies referred to in that subsection may exercise, for the purpose of enforcing compliance with any requirement imposed under this title any other authority conferred on it by law, except as provided in subsection (d).

(d) Neither the Commission nor any other agency referred to in subsection (b) may promulgate trade regulation rules or other regulations with respect to the collection of debts by debt collectors as defined in this title

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So, did you dispute the debt? or; Based upon the info provided, you cannot determine your liability?

I would send a letter quoting the FDCPA as well as informing them they have not fulfilled the obligations required by the FDCPA. In doing so, they have become liable for actions as provided by the FDCPA and until they do perform per the FDCPA to not contact you again.

Mind you, this will not prevent them from suing you if they want but it should stop the collection activities outside of the courts. If it doesn't, or you want to retaliate regardless of their actions, contact an attorney for assistance. Legal fees are taken into consideration in the Act.

the OP has never been back to deny or acknowledge if the info required was in the original contact or not. It very well could have been and as such, the CA is not required to validate the debt to any greater extent.

as in your post:

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The statute requires that the debt collector obtain verification of the debt and mail it to the consumer.

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First off I must apologize for the lateness of my response. I had believed that I had set up notification to be emailed to me whenever this thread had been responded to. Before today, I thought no one had responded. I am glad that was not the case, and thank you to all of you who have responded.


It appears I left out a few important details in my initial post.

Here is a chronicle of events:


Out of State Debt buyer (OoSDB) sends me letters for about a year. On June 16th they send me a letter saying about as much as they have said in the past:

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"... In the event that we fail to hear from you within ten (10) days, your account will be reviewed for possible forwarding to a collection law firm in your area for the purpose of filing a lawsuit in an attempt to reduce your debt to a civil judgment. ... Note: This letter is from a debt collector. This is an attempt to collect a debt. Any Information will be used for that purpose."

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I understand that the letter is vague enough that it is likely not a violation FDCPA, even though it took them until approximately August 3rd to give me a call at work, asking me to make a voluntary payment and when I said I dispute this debt they told me verbally that they would refer my case to the legal department. (Of course I made sure to convey to them that it was not ok to contact me at work)

This caused me to send the OoSDB a letter that stated:

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I dispute the claimed debt(s) ..

Please provide any contract or agreement we signed and an account history showing how you arrived at the conclusion that we owe the amounts claimed and when this alleged debt(s) was charged off.

...

Unless and until such proof is furnished, we do not recognize any right on your part to attempt to collect any amount from us through any means whatever, including credit reporting. We refuse to pay any debt which has not been substantiated in the manner we request and direct you to cease further communications unless and until you can provide such substantiation.

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I sent this letter to the OoSDB on August 6th.

On August 11th, I letter is written by the Michigan Collections Attorney (MCA) and sent to my parents house in Michigan. Stating:

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Creditor: OoSDB
Amount Claimed Due: XXX
...

The above referenced account had been referred to this office. In addition, because of interest, late charges that may vary from day to day, the account balance on the day you pay may be greater....

In accordance with Federal Law, we are required to notify you of the following:
"This is a debt collector. Unless you notify this office within 30 days after receiving this notice that you dispute the validity of the debt or any portion thereof, this office will asume this debt is valid. ... At this time, no attorney with this firm has personally reviewed the particular circumstances of your account. This is an attempt to collect a debt. Signed paralegal clerk.

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I mail the same verification letter as above to the MCA on August 15th. On August 20th a letter is written to me by the partner of the MCA stating:

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Creditor: Major Credit Card Company (MCCC)

Please be advised that I am in receipt of your letter requesting verification. I am enclosing the following as verification of the aforementioned debt:

1. Affidavit

Please be further advised that MCCC is the original creditor. The address for OoSDB is:

MCCC
MCCC's address


Let's work together to resolve this matter..
This communication is from a debt collector and is an attempt to collect a debt.

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The affidavit as a mentioned in my original post was a from a legal desk supervisor from the OoSDB. Which basically stated:

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OoSDB
Assignee of MCCC
Plantiff,

vs.

AnonSmith
Defendent

...

That there is justly an amount due and owing OoSDB, Assignee of MCCC by the defendant to the plaintiff the sum of money amounting to XXX, plus interest totaling $.00, beginning from through APR 30 2006; and that such balance will continue to earn interest at a rate of .00% from APR 30 2006, ...

That the said indebtedness represents the amount due and originating on a credit card, which OoSDB is the assignee of MCCC, and that OoSDB assignee of MCCC, the within named plaintiff, having purchased said debt, is the owner of said debt and is the proper party to bring this action.

... That the Plaintiff keeps regular books and records ... said entried show the Defendant s indebted to the plaintiff in the manner and amount set forth herein.

Dated August 7th.

Sign by OoSDB supervisor and Notary Public.

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So there are the details. From what I have gathered from what people have posted is this:

The verification that they are required to send me if I request it within the first 30 days is only to say that the original creditor believes I owe the stated amount of money, and they do not need to give any verification of how they reached that amount. Is this correct?

If this is correct is there anything I can do besides wait and see if they sue me? When they will be required to show how they arrived at the amount owed.

When I sent the MCA the request for verification letter, I made sure to include my out of state address. They proceeded to email my parents in Michigan with the affidavit. If I send them a cease and desist letter telling them to only contact me at my out of state address does that mean if they wish to sue me I must be served in my current state of residence?

Thanks again for all your help and I hope this clears up some of the questions the posters had.


[/quote]

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Quoting anonSmith

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Out of State Debt buyer (OoSDB) sends me letters for about a year. On June 16th they send me a letter saying about as much as they have said in the past:

I understand that the letter is vague enough that it is likely not a violation FDCPA, even though it took them until approximately August 3rd to give me a call at work, asking me to make a voluntary payment and when I said I dispute this debt they told me verbally that they would refer my case to the legal department. (Of course I made sure to convey to them that it was not ok to contact me at work)

* * *

This caused me to send the OoSDB a letter that stated: "I dispute the claimed debt(s)...."

I sent this letter to the OoSDB on August 6th.

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You are stating that your first request for validation was made more than thirty days after the most recent written notice was received, and about a year after the debt collector first contacted you about the debt? That helps us understand why the debt buyer was unconcerned with the Wollman letter or an FDCPA violation for failure to properly validate the debt.

The side discussion has been split into its own thread.

Sorry, but to be on topic:

The FDCPA says that they must obtain the verification and send it to the debtor. Chaudhry v Gallerizzo (the most widely cited case on validation) says that validation is nothing more than the creditor confirming in writing what the creditor says is owed. Since the purchaser of a debt that is in default is considered to be a debt collector, an affidavit written by an employee of a debt collector cannot be validation.

from how I read the situation, the "law firm" is not merely a law firm but a second collection agency which would start the timeline over so a request for verification within 30 days of first contact from them would require them to do so or cease collection activities.

the problem is, the letter OP wrote:

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Please provide any contract or agreement we signed and an account history showing how you arrived at the conclusion that we owe the amounts claimed and when this alleged debt(s) was charged off.

...

Unless and until such proof is furnished, we do not recognize any right on your part to attempt to collect any amount from us through any means whatever, including credit reporting. We refuse to pay any debt which has not been substantiated in the manner we request and direct you to cease further communications unless and until you can provide such substantiation.

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Is not enforcable via the FDCPA. Verification has been spoken of many times here and all that needs to be presented to the debtor is original creditor and the amount which has been confirmed with the original creditor. It is not required that an accounting be provided or a contract that the debt is a result of.


It appears MCA did send the required verification so they can continue collection activities.

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If this is correct is there anything I can do besides wait and see if they sue me?

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You can talk with them. Failure to communicate will result in them suing you, if that is their desire.

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When they will be required to show how they arrived at the amount owed.

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the only time they will be required is if they sue you.. They may explain things to you if you communicate with them in a reasonable manner.

If they want to effectively sue you, they will have to sue you in your home state OR sue you in Michigan, and if you fail to have the suit quashed due to lack if jurisdiction or such, have the judgment recognized in Florida and take whatever means are allowed in Florida to collect a judgment.