Can/Should I sue the debt collector?

[gkisystems]

What is the name of your state (only U.S. law)? Wisconsin.

I purchased home owner's insurance over the phone for a period of 1 year with my credit card. I never spoke to anybody in person or signed any documents of any kind - just a quick deal over the phone with my credit card number.

After the year of insurance was up, I decided to go with another insurance company. In order to get the best rate possible with the new company, I had to have current/active coverage - so I paid over the phone for one additional month (13 total months) with the original insurance company. At this time, I also informed the company on the phone I was going with another insurance company and no additional coverage was needed. In month 14, I purchased insurance with a new company.

To my surprise, the original insurance company continued to bill me for insurance. I refused to pay, called the insurance agent that I went with another company, and they should cancel the balance owed. Instead of zeroing out my balance, they sent it to collections (about $56 for 1 month of coverage) per the letter (postmarked 6/27/2012) from the collection agency. Out of principle, I refused to pay - I don't owe them one damn cent.

I sent the collection agency a letter (July 9th 2012) certified mail asking them to validate the debt. I specifically asked for:

� What the money you say I owe is for;
� Explain and show me how you calculated what you say I owe;
� Provide me with copies of any papers that show I agreed to pay what you say I owe;
� Provide a verification or copy of any judgment if applicable;
� Identify the original creditor;
� Prove the Statute of Limitations has not expired on this account;
� Show me that you are licensed to collect in my state; and
� Provide me with your license numbers and Registered Agent.

The agency responded with a letter dated 7/23/2012 (also postmarked 7/23) that arrived in my mail box on 7/30/2012. Their letter is only 3 paragraphs long and contains none of the information I asked for. Instead, the collection agency's letter states "As of 7/23/12, our client's records indicate the above referenced amount due remains outstanding. Please remit payment without delay."

Obviously they are not going to let this drop. Because they are asking me to "remit payment," it seems like this is their 2nd attempt to collect a debt I told them I do not owe and they cannot validate it. What should I do? Sue them for $1,000 each time they ask for money as per the federal law?

 

[tranquility]

They did "validate" per what the law requires. The additional information you demanded put you in the "rube" category and they will no longer take you seriously. While you may have a case, you are going about it in the wrong way. (Note, I said may. Depending on the facts, you might be liable for the insurance.) Send a clear letter telling them to cease and desist contacting you. Explain in detail why. Prepare to be sued.

 

[justalayman]

You need to understand what validation is and isn't.

� What the money you say I owe is for;

all they have to provide you is the original creditors name and the amount the creditor states is what you owe. If you did demand validation, the CA was required to obtain that information and it be sent to you.

� Explain and show me how you calculated what you say I owe;

they are not required to provide this

� Provide me with copies of any papers that show I agreed to pay what you say I owe;

they are not required to provide this

� Provide a verification or copy of any judgment if applicable;

there is no judgment yet if you have not been sued

� Identify the original creditor;

I'm guessing this was done

� Prove the Statute of Limitations has not expired on this account;

they are not required to provide this

� Show me that you are licensed to collect in my state; and

they are not required to provide this

� Provide me with your license numbers and Registered Agent.

they are not required to provide this

"As of 7/23/12, our client's records indicate the above referenced amount due remains outstanding.

sounds like they provided all they are required to:

(b) If the consumer notifies the debt collector in writing within
the thirty-day period described in subsection (a) that the
debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt,
or any disputed portion thereof, until the debt collector
obtains verification of the debt or any copy of a judgment,
or the name and address of the original creditor, and a copy
of such verification or judgment, or name and address of
the original creditor, is mailed to the consumer by the debt
collector. Collection activities and communications that
do not otherwise violate this title may continue during
the 30-day period referred to in subsection (a) unless the
consumer has notified the debt collector in writing that the
debt, or any portion of the debt, is disputed or that the consumer requests the name and address of the original creditor. Any collection activities and communication during the
30-day period may not overshadow or be inconsistent with
the disclosure of the consumer’s right to dispute the debt or
request the name and address of the original creditor.

so, unless you send a cease and desist demand, they can continue to contact you.

What should I do?

pay it or deal with whatever they decide to do if you don't.

Sue them for $1,000 each time they ask for money as per the federal law?

be my guest but from what you have stated, you would lose.

 

[justalayman]

=tranquility;3079529]Send a clear letter telling them to cease and desist contacting you. Explain in detail why

.there is no need to explain anything. OP can either send a cease and desist demand or simply tell them he isn't going to pay. In either case, the CA is required to cease all contact other than notifying the debtor of an impending suit.

This is something the OP needs to be dealing with the insurance company about. The CA doesn't care why the OP believes he doesn't owe. The insurance company hired the CA to collect the debt and that is what they will attempt to do until told to stop.

 

[tranquility]

I agree a cease and desist letter need not "explain" anything. But, one sending such a letter an hoping not to be sued, should include the reasons why. At the end of the day, the other side will review the letter and decide. If the call is just to stop contacting the person, the decision is clear. If the call is to stop because you're wrong, the decision is more difficult.

 

[justalayman]

the problem is; if this is simply a hired collection agency, they generally have no control over whether the debtor is sued or not. It is up to the actual creditor, especially since the creditor is who must actually sue the debtor.

That is why I said the OP needs to contact the insurance company and attempt to explain to them, again, why OP believes he is not liable for the debt. If the debt is still owned by the OC, then nothing you say to the CA is really going to make any difference. All they care about is attempting to convince you to pay the debt.

 

[gkisystems]

I've read the responses and appreciate them very much - thank you! However, I guess I'm still confused. If I order the collection agency to cease contacting me, I do not think that would "magically" make the debt go away. They could sue me like you say, but the amount they claim I owe is less than $60. I fail to see how any company can reasonably turn a profit when the amount they are trying to collect is less than the cost to serve papers and file a suit. What I think may be more likely is they just stop contacting me and file a report with the 3 credit bureaus to harm my credit score. I have a perfect credit report with no missed payments of any sort and I do rely on being able to use my high credit score to finance and grow my rental property business. I would not want to jeopardize my excellent credit for $60, but I also refuse to pay these *******s.

Regarding validation, the original notice the CA sent me states:

"if you request...this office will provide you with the name and address of the original creditor."

The 2nd letter from the CA (their "validation") did not specifically state who the original creditor was or the original creditor's address. It refers to the original creditor as "your creditor" and "our client." The only address on the letter they sent me is a payment center operated by the CA.

Because they did not name the original creditor and this 2nd letter asks me to remit payment, is this a violation of the law that would result in a $1,000 judgement I could pursue (and win) in court?

Based on this letter from the FTC, is it possible that the CA did not properly validate the debt?

"it is important that the verification of the identity of the consumer and the amount of the debt be obtained directly from the creditor. Mere itemization of what the debt collector already has does not accomplish this purpose."

http://www.ftc.gov/os/statutes/fdcpa/letters/wollman.htm

Doesn't the validation have to prove that I actually owe the money? I know I don't. What makes the most sense for the next step?

 

[justalayman]

Doesn't the validation have to prove that I actually owe the money?

no. It is simply a statement from the original creditor that you are the person that owes the debt and what the amount of the debt is. That's it.



as to them suing for $60. It is up to them.

What makes the most sense for the next step?

I would contact the insurance company and attempt to convince them the charge is not valid. If you can't change their mind, what you do next is up to you.

 

[swalsh411]

Doesn't the validation have to prove that I actually owe the money? I know I don't. What makes the most sense for the next step?

No. This is a common misconception. They are not required to prove to *your* satisfaction that you owe the debt. Proof would be for Court if it came to that.

 

[tranquility]

If the cease and desist has the reasons why you don't feel you owe, the creditor may be at risk if your credit report is dinged. Defamation and all that. To me, I'd not risk my credit score over $60. It hurts, sure. But it will cost you a lot more in time and hassle no matter what and in money if you are wrong.