Purpose of validation to CA

Well, this is a "loaded" question, and there will be many opinions and answers. In its simplest form, validation is the production of evidence (from the original creditor) to ensure that the alleged debt is the legal responsibility of the debtor, and the correct amount owed.

The intent of "debt validation" under the FDCPA was to keep Collection Agencies from pursuing collection of a debt from the incorrect person, or for trying to charge amounts that were not justifiable. In short, providing "sufficient" evidence that you owe this debt as claimed.

Now what constitutes "sufficient" evidence is wide open. Several legal cases have changed the precendent for what can be considered "sufficient evidence". In the end, the determination would be made by the judge you are in front of (should it go to court).

To your question of "why" you would request validation, simply because it is part of the legal process under the FDCPA (Fair Debt Collections Practices Act). Requesting validation is simply an exercising of your legal right to request some evidence that the debt is truly your responsibility, and is a reasonable amount.

Secondly, there is a tactical purpose as often the paperwork trail does not keep up with the sale and transfer of the debt, and cannot be readily accessed, hence provided. Also, due to the volume of debts handled by CAs, often a request for validation is sufficient for them to discontinue collection activity. They simply move on to a more probable collectable debt.

 

Yes and No; technically the CA only has to provide the name and address of the original creditor, and the amount due. The CA is supposed to acquire any documentation from the OC, and forward it to you.

In this "real life situation" there is a contract. It is in the paperwork that came with the card received in the mail. They usually request that you "call" from your "home phone" to activate the card. Calling from your home phone verifies that you are the person the card was sent to, and is an agreement to the terms and conditions of the account agreement. Just because the CC company made it easy for you, does not make it any less legal and/or binding.

I'll have to look up some of the cases, as recent cases have changed the playing field. Brennon vs. Spears was the big one years ago, but that has been challenged and beaten. If you are interested in researching this, go to the FTC website, and read many of the opinions posted on the FDCPA.

 

If you're willing to spend a couple of bucks, you can go to the PACER web-site at http://pacer.psc.uscourts.gov/ and look up federal law suits as well as appeals. That's a great resource if you're willing to dig into some legalese. It costs about $0.08/page to read, but for $50 or less, you can get a gold mine of information on how to pursue an FDCPA case. (just look for the FDCPA cases that have a long document history).

 

"In this "real life situation" there is a contract. It is in the paperwork that came with the card received in the mail. They usually request that you "call" from your "home phone" to activate the card. Calling from your home phone verifies that you are the person the card was sent to, and is an agreement to the terms and conditions of the account agreement. Just because the CC company made it easy for you, does not make it any less legal and/or binding."

Biz, the above is a quote from you:
Calling from your home phone to activate a card is somewhat of a wrong assumption. When you first apply you have to list A phone # on your application. My wife and I have two cell phones with different numbers. We tested this once - on my cc application I listed her #, and when I received the card I activated it from my cell. NO issue whatsoever. Activation went through without a hitch.
And don't forget, people change phone numbers every day. Between the time you fill out an application, send it in, goes through the approval process, that phone # that you originally listed may not be your number anymore.

 

This scenario is exactly why the legal opinons of "what is validation" have opened up. In the above scenario, the "real life consumer" has taken the actions to enter into a contract, then is looking for a loophole to avoid responsibility for accrued debt. The courts realize that this technical point was not the intention of the FDCPA.

It is true that there is a possibility of an identity theft in this scenario, but the probability of it not being caught for a length is somewhat minimal. Hence, it is "reasonable" to presume the debt is valid to the consumer.

The FDCPA was not enacted to allow escape from valid debts, it was written to portect innocent consumers, and those debtors suffering from extreme harrassment.

 

There's no black-and-white answer here because there hasn't been a lot of case law yet.

If the collection agency sends you something they typed up, stating an account number, a balance, and the name of the original creditor, is that adequate validation? We don't know. The law doesn't specify what constitutes adequate validation, and the courts haven't ruled.

The CA obviously feels that they have validated, and can thus continue collection activities. The consumer feels that the collection agency has simply restated the original claim and not provided any real validation, and thus shouldn't be able to resume collection activities.

The fact is that until a few consumers have filed suit on the grounds of continued collection activities without validation, we don't KNOW. We need court decisions on this to provide guidance to CA's as to what they are expected to provide, and to consumers as to what they should accept.

I don't think that a simple re-stating of the CA's claim is proper validation. But I also don't want to be the pro-se litigant who tries to make this case in Federal Court for the first time.

 

I almost forgot to answer the original question, which is "what is the purpose of asking for validation?"

There are several tactical reasons for requesting validation.

1) First and foremost, the consumer wants to make sure that the collection agency is attempting to collect on a valid debt, that they are attempting to collect from the correct consumer, and that they are attempting to collect the correct amount. In a perfect world, we would get proper validation which would support all of these claims.

2) Requesting validation also signals to the CA that the consumer has some idea of his legal rights and how to protect them. Like a cobra spreading his hood and hissing, the DV letter says "Don't mess with me unless you're serious."

3) In my somewhat limited experience, simply sending a DV letter is often enough to make the CA crawl back under their rock. My worst "baddie" was a credit card that was charged off but still within SOL. I wanted to pay it but there was a discrepancy in the amount that I wanted to resolve. I DV'd the agency, and they promptly returned it to the OC, who passed it on to a new agency. We went through four agencies and finally the OC agreed to accept a payment and remove the tradeline. In total, on all of my accounts, I've DV'd six agencies and only received validation from one.