Milo buys an all-terrain-vehicle (ATV) from No-Limit Toys, Inc., on credit but makes no payments on the account. Odell, the owner of No-Limit Toys, calls Milo at home on a Monday morning at three a.m. Odell represents himself as PayNow Collection Agency and demands payment "or else." The next day, Odell sends Milo notice that he has thirty days to request verification of the debt, during which its payment will be suspended, but that if he does not pay the full amount due within five business days, Odell will arrange for the "destruction of Milo's good credit rating." Which laws has Odell violated, if any, and in what ways?

Question

What will be an ideal response?

Answer 1

Odell, No-Limit Toys's owner, is in violation of the Fair Debt Collection Practices Act (FDCPA). Odell can attempt to collect the debt to No-Limit Toys without being subject to the provisions of the FDCPA, which applies only to debt-collection agencies that regularly attempt to collect debts on someone else's behalf. But by misrepresenting that he is acting on behalf of a collection agency, Odell has fallen under an exception in the FDCPA. Causing Milo, or any other consumer, to believe that Odell is a representative of a collection agency subjects Odell to the law. The FDCPA prohibits contacting a debtor during an inconvenient or unusual time, which Odell has done in this problem with the early morning call. If the "or else" phrase is construed as harassment or intimidation¾as a threat of potential violence, for example¾Odell will be in further violation of the FDCPA. Also, the statement in the notice that Milo has thirty days to request verification of the debt but only five business days to pay it violates the FDCPA. The five-day demand is misleading and nullifies the thirty-day suspension