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  • Debt collection - time limits & creditor switching agencies

    I have a question about the FDCPA, and how its dispute provisions
    apply when the original creditor tries again with a different
    collection agency.

    Because I have the same name as some of my relatives, I've
    occasionally had credit reporting errors for debts or accounts that
    weren't mine. I recently received a call from LTD Financial (in
    Houston) about an American Express card debt that wasn't mine. I told
    them not to call me again. They sent a letter demanding payment. I
    sent a FDCPA-invoking letter disputing it and demanding that they
    produce proof the debt was mine. Delivery confirmation proves they
    received it within my 30-day window. Over 30 days have passed since
    then, without any response from LTD showing I am the person who owes
    the debt.

    Sounds good, right? But now I've received a letter from a different
    collection agency (in Michigan) demanding payment for the same
    American Express debt. (They're actually demanding a reduced amount,
    but it's still not mine.) As I read the FDCPA, no further collection
    action can be taken by the collector without providing verification of
    the debt. Can Amex get around that by using a different agency for
    later efforts? Collector-hopping like that seems to violate the
    spirit (yeah, yeah ...) of the law if not the letter.

    Also, what time limit does the agency receiving the dispute letter
    (LTD) have for producing proof? Can the clock run out on collection
    if proof isn't provided? I've been googling for FTC opinions, since
    the text of the FDCPA doesn't specify anything at that stage. Does
    anyone know of a reference for this? Thanks.
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