The Bankruptcy Stay & Contradictory Dunning Letters

Debt collectors do a lot of ridiculous things, but this letter from Lender Business Process Services is apparently an attempt to alter reality. LBPS seems to think it can simultaneously collect and not collect a debt.

Here is its disclaimer, which provided at the bottom of its dunning letter:

This communication is from a debt collector as we sometimes act as a debt collector. We are attempting to collect a debt and any information obtained will be used for that purpose. However, if you are in bankruptcy or received a bankruptcy discharge of this debt, this letter is not an attempt to collect the debt, but notice of possible enforcement of our lien against the collateral property.

(Emphasis added; plus, I got rid of the all-caps for readability.) One of the two italicized statements is false. Either the letter is an attempt to collect a debt (which it obviously is—the letter begins “[w]e hereby demand that you cure the default by payment of the amount shown above”), or it isn’t. It cannot be both at the same time.

That means the letter contains false statements, which would seem to violate the Fair Debt Collection Practices Act. And if it is an attempt to collect a debt, it would seem to violate the bankruptcy stay, if LBPS sends it to someone who has filed bankruptcy.

(Thanks to Minnesota bankruptcy attorney Brad Perri for the tip!)