From my reading here and elsewhere I see that the FDCPA is primarily over Collection Agents rather than Original Creditors. Also have read an FTC ruling that indicates that Midland Credit (and other CAs) are covered by the FDCPA when they purchase batches of debt from other companies. This brings me to a question: Last year HSBC Bank purchased Direct Merchants Bank. I had an old Direct Merchants credit card debt of $225 that is about six years old. This is now listed as an HSBC debt. So now I would like to know if HSBC, who in effect purchased my debt when they purchased Direct Merchants, is covered under the FDCPA as a Collection Agent since the debt that was originally with Direct Merchants?
If the account was in deafult when it was purchased, it would probably fall under FDCPA defintion of debt in 803(5) Also, if they try to collect under any name other than hsbc: 3. Application of definition to creditor using another name. Creditors are generally excluded from the definition of "debt collector" to the extent that they collect their own debts in their own name. However, the term specifically applies to "any creditor who, in the process of collecting his own debts, uses any name other than his own which would indicate that a third person is" involved in the collection. A creditor is a debt collector for purposes of this act if: He uses a name other than his own to collect his debts, including a fictitious name. His salaried attorney employees who collect debts use stationery that indicates that attorneys are employed by someone other than the creditor or are independent or separate from the creditor (e.g., ABC Corp. sends collection letters on stationery of "John Jones, Attorney-at-Law"). He regularly collects debts for another creditor; however, he is a debt collector only for purposes of collecting these debts, not when he collects his own debt in his own name. The creditor's collection division or related corporate collector is not clearly designated as being affiliated with the creditor; however, the creditor is not a debt collector if the creditor's correspondence is clearly labeled as being from the "collection unit of the (creditor's name)," since the creditor is not using a "name other than his own" in that instance.
P Rider or others, Here's what I got from your post: 1) If the debt was in default before the purchase, then the debt will likely fall under FDCPA as a purchased debt. 2) Any person / entity attempting to collect a debt other than their own (even if they have purchased the debt and have made it their own through purchase) is a "collection agent" and is covered by the FDCPA. 3) Any person / entity attempting to collect a debt (even if it is his own debt) by using a name other than his own name (including an assumed name), is a "collection agent" and is covered by the FDCPA. Using these conclusions it does appear that my Direct Merchants credit card debt is a purchased debt and the purchaser HSBC is covered by the FDCPA. Can you tell me which court decisions, FTC opinions, etc. provide these designations?
I agree with Pale Rider. Here are the FTC opinion letters on FDCPA: http://www.ftc.gov/os/statutes/fdcpa/letters.htm I think there may be a letter covering in-house collection departments using another name, but I have not found it, nor have I found one specifically on defaulted debt purchased as part of buying a company.
