Debt Collector Schreiber Law Alleged to Violate Fair Debt Collection Practices Act by Not Identifying Midland Funding as Creditor
A class-action lawsuit in Massachusetts federal court against the collection law firm Schreiber Law, LLC alleges the violation of federal debt collection laws. Under the Fair Debt Collection Practices Act (FDCPA), the initial letter sent by a debt collector must include the name of the creditor who owns the debt. The lawsuit here claims that though the collection law firm identified who its client was, Midland Funding, the failure to also state that its client actually owned the debt constituted a violation of the FDCPA.
The FDCPA, 15 U.S.C. 1692g, states that within five days of the initial communication with a consumer debtor, a debt collector must send a letter with the name of the creditor to whom the debt is owed. This is intended to help consumers identify who they are allegedly liable to because consumers sometimes confuse the debt collector with the creditor who actually (allegedly) owns the account.
The letter was not quite so clear. The consumer received a letter from Schreiber Law stating “this law firm represents Midland Funding, LLC.” But, the letter did not expressly say that Midland Funding owned the account.
The consumer alleged that as a result of the phrasing of this letter, she was not sure who on the account, and the letter was thus confusing, in violation of the FDCPA. She thought the owner could have been either the original creditor, Schreiber Law, or Midland Funding. Midland Funding is what is called a debt buyer, a company who purchases bad debts in order to collect on them, though it does not issue credit cards or other credit.
The court has not made a final ruling, but this case is instructive nevertheless. It highlights the fact that debt collectors must use precise language in their communications with consumers. This requirement is, after all, the debt collectors’ own fault. Through the repeated buying and selling of consumer debt, sometimes multiple times over through numerous companies, consumers may easily become confused. (Our office has seen debts assigned five or more times.) By complying with the strict requirements of the FDCPA, the purposes of the FDCPA – to prevent unfair and deceptive acts or practices in the course of debt collection – are fulfilled.
The name of the case mentioned in this post is Marti v. Schreiber/Cohen, LLC, and the case was filed in the U.S. District Court for the District of Massachusetts.
Culik Law is a Massachusetts consumer protection law firm. We represent consumers, debtors, and individuals who are subject to debt collection lawsuits or abusive collection tactics. If you have a question about your rights, contact us to see if we can help.