THE DO’S AND DON’TS

OF
COLLECTION LETTERS
Presented by:
MARK E. ELLIS
ANDREW M. STEINHEIMER
AMANDA N. GRIFFITH
ELLIS LAW GROUP,
LLP
 BACK TO BASICS

This presentation will

cover the Do’s and Don’ts
of Collection Letters.
 INITIAL LETTER

• Requirements for the Initial

Letter
* Do include the 1692g
notice.
* Include it verbatim.
* Do include the total balance
due.
* Do include the current
creditor.
 LETTERS TO CALIFORNIA

* Do include Civil Code § 1812.700

language:
“The state Rosenthal Fair Debt Collection Practices Act and the federal Fair
Debt Collection Practices Act require that, except under unusual
circumstances, collectors may not contact you before 8 a.m. or after 9 p.m.
They may not harass you by using threats of violence or arrest or by using
obscene language. Collectors may not use false or misleading statements or
call you at work if they know or have reason to know that you may not receive
personal calls at work. For the most part, collectors may not tell another
person, other than your attorney or spouse, about your debt. Collectors may
contact another person to confirm your location or enforce a judgment.”
 LETTERS TO CALIFORNIA

Civil Code § 1812.701

Notice must be verbatim.
Notice must be in the same type-
size as the type-size used to inform
the debtor of the specific debt but
does not need to be larger than 12-
point.
 LETTERS TO CALIFORNIA

Do include credit reporting notice

required by
Civil Code § 1785.25(c)(2):
“As required by law, you are hereby
notified that a negative credit report
reflecting on your credit record may
be submitted to a credit reporting
agency if you fail to fulfill the terms of
your credit obligations.”
 INITIAL LETTER DON’T’S

* Don’t include request for

“IMMEDIATE” payment.
* Don’t include reference to
litigation.
* Don’t include reference to
“further action” or “activity.”
 INITIAL LETTER BONUS DO’S

* Include notice that all calls

may be recorded.
* Include statement that if the
debt is subject to
bankruptcy, the letter is for
informational purposes only
 SUBSEQUENT LETTER DO’S AND
DON’TS
* Do include statement – this
communication if from a debt
collector
* Don’t send second letter within
30 day validation period
* Don’t include 1692g notice
 SUBSEQUENT LETTER DO’S AND
DON’TS
* Do identify debt including
creditor and amount
* Don’t imply from an attorney or
legal department
* Don’t threaten any action you do
not intend to take
 OUT OF STATUTE DEBT

Don’ts: Don’t collect out of statute

debt
But if you Do:
Beware of settlement offers
Don’t threaten litigation or pursuit of
“remedies”
IDENTIFY THE CURRENT BALANCE

* Static Balances
* Increasing Balances
* Balance increases with
interest
* Most common in industry
 INCREASING BALANCES

* State current balance in

letter
* Use of disclaimer that
interest continues to accrue
* Update current balance for
each letter
 INCREASING BALANCES
Use of disclaimers when collecting on an increasing balance debt

Example – “As of this letter you owe $_______[the exact amount

due]. Because of interest, late charges, and other charges that may vary
from day to day, the amount due on the day you pay may be greater.
Hence, if you pay the amount shown above an adjustment may be
necessary after we receive your check, in which even we will inform you
before depositing the check for collection. For further information, please
call ______[name] at ____ [phone number]. See Miller v. McCalla,
Raymer, Padrick, Cobb, Nichols and Clark LLC (7th Cir. 2000) 214 F.3d.
872

Examples: Avila v. Riexinger & Associates LLC (2nd Cir. 2016) 817 F.3d.
72 [1692e violation]
 INCREASING BALANCES

Update “current” balance for each letter. See

Dupuy v. Weltman, Weinberg & Reis Co.
(N.D.Cal. 2006) 442 F.Supp.2d 822 [letter
referring to possibility of interest, but showing
same amount due as previous letter may
violate the FDCPA].
 SETTLEMENT OFFERS

Do settlement offers violate the

FDCPA?
False and Misleading –
1692e(10)/Unfair – 1692(f)

*One-time offers
*Limited Offers/ Offers with
Expiration Dates
TREATMENT OF MULTIPLE DEBTS

Do send separate initial letters for

each distinct debt.
Do identify each debt by account
no., balance and creditor in
subsequent letters.
 CFBP
• The CFPB has ordered Navy Federal Credit Union to Pay
$28.5 Million for, among other things, multiple letter violations.
•
• Falsely threatening legal action and wage garnishment;
•
• Misrepresenting credit consequences of falling behind on a loan;
and,
•
• Falsely threatening to contact commanding officers.
•
• Of the $28.5 million ordered, $23 million is for compensation to
consumers who received threatening debt collection letters.
 PRE-COLLECT AND EARLY OUT

• Don’t – Just Don’t

But if you Do . . .
• Do include 1692g notice
• Do include Mini-Miranda
 WHEN YOU DO A DON’T

* Rosenthal Safe Harbor

(Civil Code § 1788.30(d)
* Bona Fide Error
* Mistake Must Be Material
Donohue v. Quick Collect, 592 F.3d 1027 (9th
Cir. 2010)
* No Actual Injury – No Standing
Spokeo, Inc. v. Robins, 578 U.S. ____
(2016)
 THE END

Thank you.