Debt buyers upset that they might actually have to tell consumers their debt has been sold

The Massachussetts House of Representatives is considering a bill that would require debt buyers to notify consumers when the debt buyer purchases the consumer’s debt. The bill would require the notice to contain

• the dollar amount of the debt;
• the original creditor;
• the date on which the debt purchaser bought the debt; and
• the interest rate and penalty charges that may be charged on the debt.

Predictably, ACA International (”The Association of Credit and Collection Professionals”) complains that “The obligations placed on debt purchasers are very onerous and would encounter serious implementation problems.” The ACA goes on to point out that “This requirement is based on a flawed assumption; that the debt purchaser, or debt seller for that matter, is in possession of the correct address information for the consumers at issue.”

In other words, they are just guessing, anyway, and don’t want to be held liable for guessing wrong. Although debt collectors don’t mind guessing wrong when it benefits them (i.e., they serve the wrong consumer or the right consumer at the wrong address, and garnish someone’s bank account unlawfully).

The debt buyer would also have to send the consumer a monthly statement just like any other creditor does. The ACA points out (correctly, I think) that this would conflict with FDCPA requirements, among them the requirement that a debt collector must cease all communication if a consumer requests verification within 30 days of the initial communication.

However, it would be a simple matter to amend the bill to deal with this conflict.

The bill actually seems like a step in the right direction. Consumers should have a right to know to whom they owe money so that they can pay off the debt if they acknowledge it, or so that they can challenge the debt if they do not. It would be nice to see a requirement like this become a part of the FDCPA, though, not just the law of Massachussetts.