Monday, January 9, 2006

California Laws on Creditor Harassment & Call Times

California Laws on Creditor Harassment & Call Times

The California Rosenthal Fair Debt Collections Practices Act was enacted in 1977 to supplement the federal Fair Debt Collection Practices Act. Since the federal law enforced by the Federal Trade Commission limits the debt collection practices of only debt collection agencies, the California legislature enacted the state law to help protect consumers against deceptive practices used by debt collection agencies and against deceptive collection practices used by original creditors.

Prohibited Harassment

    Both the federal law and the California Rosenthal Act regulate the method of contact, the frequency of contact and the parties they may contact during their debt collection efforts. Debt collectors may not engage in debt collection activities that are intended to harass or have the effect of harassing consumers. Debt collectors may not repeatedly contact or attempt to contact consumers by calling them, sending them electronic communications or by using profanity or threats of violence. Although the California law does not specifically limit the number of calls creditors can make, it does state that "repeated" calls within a short time frame are prohibited.

Call Times and Method of Contact

    Debt collectors may only attempt to contact consumers between the hours of 8 a.m. and 9 p.m. Calls outside of those hours are illegal. Consumers have a right to limit the types of contact that creditors can make. A consumer has a right to demand that creditors contact her only through written correspondence and can limit contact by telephone. Although a debt collection agency has a right to contact a consumer at work, it must immediately stop contacting an employee while working if asked not to.

Legal Remedies

    The California Rosenthal Fair Debt Collection Practices and the federal Fair Debt Collection Practices Act allow consumers to sue creditors who violate the consumer protection laws by filing private actions. Furthermore, Californians can file governmental complaints against debt collectors by contacting the California Department of Consumer Affairs or the California attorney general's office. Consumers can file complaints under the federal act by contacting the Federal Trade Commission's Consumer Response Center. Federal legal remedies allow federal courts to impose large fines against creditors, including fines of up to $500,000 for class-action lawsuits.

Private Actions

    Consumers have a one-year statute of limitations period to file private lawsuits from the time the violation occurred. They may file their actions in any general jurisdiction court within California, such as the California small claims courts. Consumers can ask California courts to award damages if they sustained actual damages resulting from misrepresentation, harassment or for contacting employers and ultimately leading to job loss. Additionally, California courts have the authority to award civil penalties against creditors for amounts between $100 and $1,000 per penalty. Consumers are entitled to collect reasonable attorneys' fees from creditors. However, creditors who prevail in court can collect attorneys' fees from consumers. Moreover, a court can award damages to creditors if they were subject to frivolous lawsuits and bad-faith allegations by consumers.

Considerations

    Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.

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