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Shanker v. Fair Collection & Outsourcing, LLC

2009 WL 1767580 (U.S. Dist. Ct. D. N.J. 2009) (Unpublished)

FAIR DEBT COLLECTION PRACTICES ACT — The Fair Debt Collection Practices Act requires a debt collector to advise the alleged debtor that it is seeking to collect a debt, but there are no magic words to do so and it is not required that the specific phrase, “this is an attempt to collect a debt by a debt collector” be used; it is only required that the “least sophisticated debtor” readily recognize that the communication has been sent by a debt collection agency.

An individual alleged that a representative from a collection agency contacted him. He denied owing any money and requested verification of the debt. Verification of the debt was sent to the individual. The individual sued the collection agency claiming that the letter violated the Fair Debt Collection Practices Act (FDCPA) because it failed to disclose that the agency was a debt collector using the words: “This is an attempt to collect a debt by a debt collector” and by the letter’s disclosure to a third-party of the nature of a debt without the debtor’s prior consent.

The District Court dismissed the claims. Although there was a question as to whether the individual received the second page of a two page letter, the Court held that the first page, standing alone, was sufficient to provide the individual with notice that the communication was from a debt collection agency. Using the “least sophisticated debtor” standard, the Court rejected the individual’s contention that a debt collector could only convey its identity, in accordance with its obligations under the FDCPA, with the use of a specific phrase, i.e., “This is an attempt to collect a debt by a debt collector.” It ruled that courts faced with similar challenges have not required “magic words” or specific phrases to meet the requirements of the statute. The Court opined that in determining whether a communication violates the least sophisticated debtor standard, it would look to the entire language of the communication to discern if a credulous debtor would be deceived. In the instant case, the Court concluded that the least sophisticated consumer would be well aware that the letter titled “VERIFICATION OF THE DEBT” signed by a representative of the collection agency was a communication disseminated by a debt collector. Further, the Court noted that the individual actually requested that the letter be sent to him. It stated that the individual could not stick his head in the sand and plead ignorance as to the source of the letter or the meaning of “VERIFICATION OF THE DEBT.” Finally, the Court stated that the individual did not identify in what way the first page of the letter was deficient, except as to intimate that the agency’s failure to unequivocally disclose that the correspondence was a “communication from the debt collector” violated the applicable section of the FDCPA.

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