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Fair Debt Collection Practices Act

 The Fair Debt Collection Practices Act (FDCPA), Pub. L. 95-109; 91 Stat. 874, codified as 15 U.S.C. § 1692 –1692p, approved on September 20, 1977 (and as subsequently amended) is a consumer protection amendment, establishing legal protection from abusive debt collection practices, to the Consumer Credit Protection Act, as Title VIII of that Act. The statute's stated purposes are: to eliminate abusive practices in the collection of consumer debts, to promote fair debt collection, and to provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information's accuracy.[1] The Act creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the Act.[2] It is sometimes used in conjunction with the Fair Credit Reporting Act

Consumer Credit Laws

The Fair Credit Reporting Act

 

 

The Fair Credit Reporting Act (FCRA) is a federal law that regulates credit reporting agencies and compels them to insure the information they gather and distribute is a fair and accurate summary of a consumer’s credit history.

The FCRA is chiefly concerned with the way credit reporting agencies use the information they receive regarding your credit history. The law is intended to protect consumers from misinformation being used against them. It offers very specific guidelines on the methods credit reporting agencies use to collect and verify information and outlines reasons that information can be released.

The law was passed in 1970 and amended twice. It is primarily aimed at the three major credit reporting agencies — Experian, Equifax and TransUnion — because of the widespread use of the information those bureaus collect and sell. The law also applies to banks, credit unions and agencies that sell medical records and check writing or rental history records, as well as any businesses that use information on credit reports for hiring purposes.

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Fair and Accurate Credit Transactions Act

 

The Fair and Accurate Credit Transactions Act of 2003 (abbreviated FACT Act or FACTA, Pub.L. 108–159) is a United States federal law, passed by the United States Congress on November 22, 2003,[1] and signed by President George W. Bush on December 4, 2003,[2] as an amendment to the Fair Credit Reporting Act. The act allows consumers to request and obtain a free credit report once every twelve months from each of the three nationwide consumer credit reporting companies (Equifax, Experian and TransUnion). In cooperation with the Federal Trade Commission, the three major credit reporting agencies set up the website, AnnualCreditReport.com, to provide free access to annual credit reports.[3]

The act also contains provisions to help reduce identity theft, such as the ability for individuals to place alerts on their credit histories if identity theft is suspected, or if deploying overseas in the military, thereby making fraudulent applications for credit more difficult. Further, it requires secure disposal of consumer information.

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Fair Credit Billing Act

 The Fair Credit Billing Act (FCBA) is a United States federal law enacted in 1974 as an amendment to the Truth in Lending Act (codified at 15 U.S.C. § 1601 et seq.). Its purpose is to protect consumers from unfair billing practices and to provide a mechanism for addressing billing errors in "open end" credit accounts, such as credit card or charge card accounts.[1] 

 

The following are examples of billing errors under the FCBA:[2]

  • Charges not actually made by the consumer
  • Charges in the wrong amount.
  • Charges for goods or services not received by the consumer
  • Charges for goods not delivered as agreed
  • Charges for goods that were damaged on delivery
  • Failures to properly reflect payments or credits to an account
  • Calculation errors
  • Charges that the consumer wants clarified or requests proof of
  • Statements mailed to the wrong address
  • Significantly not as described product/goods

 

Correction of billing errors[edit]

The FCBA allows consumers to dispute billing errors by sending a written notice of the dispute to the creditor. To trigger duties under the Act, a person must send a written dispute via mail to the "billing inquiries" address on their credit card statement, not the address for sending payments.[1] This dispute must be received by the creditor within sixty days of the statement date on the account statement that first contained the billing error.[1][3] Notice given by telephone is not sufficient to trigger the protections of the FCBA; a consumer can only protect their rights under the Act by sending a written notice, or online if the creditor indicates to consumers that it will accept notices electronically.[4][5] Banks may accept disputes by phone while warning their customers that phone complaints do not preserve the customer's rights under the Act.[6] This often leads to a chargeback to the vendor.[citation needed]

After receiving notice of a dispute, the credit issuer must acknowledge the dispute within thirty days, investigate the claim and, within ninety days, either make appropriate corrections to the account or send a letter to the consumer explaining why the creditor believes there was no error. If the creditor responds that they believe there was no error, the consumer can request copies of documentation supporting the validity of the disputed items.[1][4]

Other regulations of the FCBA[edit]

In addition to creating a mechanism for dealing with billing errors, the FCBA contains additional regulations, including the following:

  • Billing statements must be sent at least fourteen days before the payment is due for open end credit accounts that have a grace period prior to adding finance charges.[1]
  • If banks report payments as delinquent to credit bureaus they must also report a charge is disputed.[4][7]
  • Credit card companies may not prohibit merchants from offering discounts to people who pay with cash or check.[8]
  • Banks may generally not use money in checking or savings accounts to pay a delinquent credit account with the same bank.[9]
  • The FCBA's § 170 gives a consumer the right to sue or assert defenses against the credit company (instead of the actual merchant) in a dispute about the quality of goods or services received, to the dollar extent of the amount of the charge(s) involved.[1](The dollar amount of the charge must exceed $50, and the purchase must have been made in the consumer's home state or within 100 miles of their address (unless the creditor is affiliated with the merchant, in which case these restrictions do not apply). The consumer must also make a good faith attempt to resolve the dispute prior to invoking this right.)

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