Adding Collection Fees Violates FDCPA, Plaintiff Claims

Plaintiff Mary D. has filed a lawsuit in New York federal court against Synergetic Communication Inc., alleging that she suffered from unlawful debt collection practices utilized by the defendant.

She specifically alleges that the defendant unlawfully violated the FDCPA, or the Fair Debt Collection Practices Act, by unlawfully adding collection fees.

According to the lawsuit the plaintiff purports that she is filing the class action to secure redress against the defendant’s violation of the Fair Debt Collection Practices Act.

Mary D. is a resident of Williston Park in the state of New York. According to the lawsuit, defendant SCI’s purpose is to collect the debt from consumers via telephone or mail.

According to the lawsuit, however, prior to May 2016, the plaintiff had purportedly incurred debt owed to American Honda Finance Corporation. The lawsuit contends that the debt owed to American Honda Finance Corporation had arisen out of the plaintiff having fallen behind on monthly car loan payments.

In June 2017, SCI mailed a letter to Mary in which it referred her to a website to make her car payments. However, Mary noticed that there was an added $8 fee required to pay for the debt through the online portal, Mary contends that the $8 fee was “not expressly authorized by any agreement.” Moreover, the $8 fee is not “permitted by New York state law.”

According to the lawsuit, the class action further contends that, “SCI collected, or attempted to collect, an authorized fee from at least 40 persons residing in the state of New York within one year of the date of this complaint.”

By adding collection fees, the lawsuit contends that the defendant violated the Fair Debt Collection Practices Act.

Accordingly, the FTC, or Federal Trade Commission, is the nation’s consumer protection agency. The FTC enforces the Fair Debt Collection Practices Act, which allegedly “prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from you.”

There are several rules and regulations that are enforced through the Fair Debt Collection Practices Act. According to the FTC, rules cover certain issues such as: what types of debts are covered, whether a debt collector may be able to contact you at any place or time, how a debt collector may be stopped from consistently contacting you, whether a debt collector may be able to contact someone that you know about your debt, and what practices are off limits for debt collectors.

According to the FTC, the FDCPA covers all personal, family, and household debt. What it doesn’t cover are any debts procured while running a business.

A debt collector may not contact you at inconvenient times or places such as before 8 am or at work. No matter how a debt collector may be in contact with you, they are under no circumstances allowed to act as someone else, such as an attorney or government agency.

To get a collector to stop contacting you, the best way is to send a letter, in writing, asking them to stop doing so. Additionally, debt collectors are allowed to contact other people, but according to the FTC, only “to find out your address, your home phone number, and where you work.

According to the FTC, “other than to obtain this location information about you, a debt collector generally is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.”

Last, practices that are off limits for debt collectors include: harassment, false statements, giving false credit information about you to anyone, including a credit reporting agency, and “try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt-or your state law- allows the charge.”

The Adding Collection Fees Lawsuit is Case No. 2:17-cv-04333-SJF-AYS, in the U.S. District Court for the Eastern District of New York.

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If you live in New York and a lender or debt collector engaged in unfair debt collection practices, you may have a legal claim and could be owed compensation for violations of the Fair Debt Collection Practices Act (FDCPA).

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DISCLAIMER: Debt collection itself is not illegal. However, debt collection firms collecting on consumer debts must adhere to the FDCPA. Even though debt attorneys are investigating these companies, their debt collection practices may be legal.