Capital One and The FDCPA

Discussion in 'Credit Talk' started by steve, Aug 15, 2000.

  1. steve

    steve Well-Known Member

    I read on another board that when you sign up for a Capital One card, you waive your rights under the Fair Debt Collection Practices Act.

    Does anyone know if this is true?

    I recently sent them a "Don't bother me anymore letter" - and all of a sudden, they're sending me "Pre-approval" letters...

    Sounds fishy to me. Any comments. (no I haven't read the fine print on the pre-approval letters, just threw them away)
  2. J. Edgar

    J. Edgar Well-Known Member

    A bank can not waive a federal law. They are still required to obey the law. They can, however, put an arbitration clause in the credit card agreement, whereby any dispute between that bank and the customer must go to binding arbitration as opposed to the customer being able to sue them in court.

    There are several cases pending in various courts challenging the legality of a creditor forcing someone to give up their right to seek redress through the courts.
  3. spice

    spice Guest

    The FDCPA pretains to third party collectors, not banks. This includes collection agencies and lawyers that have purchassed bad debts after a charge off. So you can't waive a right you don't have.

    I believe you are waiving your right to sue. You agree to arbitration instead.
  4. J. Edgar

    J. Edgar Well-Known Member

    The FDCPA also applies to employees of a creditor whose primary duties are to collect debts.

    In addition, some states have enacted laws that to some degree, require EVERY creditor comply with the FDCPA regardless of first or third party.

    I agree with your assessment that the posted probably is referring to the arb clause in their credit card agreement.
  5. spice

    spice Guest

    You are correct that it applies to employees whose primary responsiblility is to collect on debts of a creditor, but only when that creditor is using a name other than the one it issued the creditor in. You can get the full definitions of creditors and debt collectors and who the FDCPA applies to at:

    I do wish more states inact laws to reel in the big banks also. That will probably not happen in our lifetime.

    You wouldn't happen to know what states have enacted laws would you?
  6. Patm

    Patm Guest

    J. Edgar's answer is exactly correct. Whether the agreement to use arbitration will be tossed out as an adhesion contract is uncertain. The US Supreme Court has upheld similiar agreements regarding binding arbitration/ contractually waiving one's right to sue with HMOs.

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