Debt Collectors Violate FDCPA by Making False Statements in Court Filings
In the case, Kaymark v. Bank of America, the bank sent a homeowner a foreclosure complaint that claimed certain fees, including attorney’s fees and property inspection fees, were due. In reality, however, the fees had not yet been incurred.
The homeowner filed suit alleging that the bank violated the FDCPA. The bank objected and filed a motion to dismiss, arguing because the document was filed in a court case, the FDCPA did not apply.
The court of appeals rejected this argument. Citing to Supreme Court precedent, the court held that all litigation activity is subject to the FDCPA, writing that “we conclude that the fact that the debt collection activity at issue here involves a foreclosure complaint, rather than a debt collection letter, does not remove it from the FDCPA’s purview.”
What impact does this decision have? It is further affirmation that debt collectors are always prohibited from making deceptive statements or engaging in unfair conduct, regardless of whether they are making collection calls, sending dunning letters, or engaging in litigation in court. There is no forum in which the FDCPA does not apply to them, and a consumer who is treated abusively by a debt collector always has a remedy in the law.
The case is available here: Kaymark v. Bank of America
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