FDCPA: Why debt collectors call third parties and why the cases are valuable

FDCPA: Why debt collectors call third parties and why the cases are valuable

Recently, we discussed who qualifies as a third party under the Fair Debt Collection Practices Act (FDCPA). 

Now, I want to look at why debt collectors call third parties and why these cases are so valuable. 

There are two situations in which debt collectors will contact a third party. 

Calling to obtain “location information” can be a legitimate reason – if they do it right.

Location information simply means, where do you work, where do you live, what is your home phone number.

If the debt collector does not have this information or they are confused, they’ll say “We’re not sure we have the right address” or “We’re not sure we have the right phone number.”

If this is really the case, then they can contact third parties if they are incredibly careful. 

They have to be very precise on what they do during this call in order to not violate the FDCPA.

As long as they do this correctly, it is a legitimate purpose for calling a third party. 

Here’s a classic example of the debt collector doing this incorrectly: 

The collector looks you up on Google Maps, to find out who your neighbors are.

They call up your neighbor and say, “Hey, I’m trying to reach John Watts.”

Then the neighbor says, “I am not John Watts.”

“Well, does John Watts live across the street from you or in your neighborhood?”

“Well, yes, he does.”

“Could you give him a message? Tell him it is really really vital that he call me back.”

This is what is known as a “Block Party.”

The idea is that all my neighbors will come to me, or text me, or email me, or Facebook message me and say, “Hey, we’ve got this guy calling us and you need to call him back. He said he’s worried about you.”

Now I’m stressed out about it because they are calling my neighbors to get to me. 

This is an illegitimate purpose for calling a third party. 

The collector is pretending they are trying to obtain “location information” but they are really not. 

Sometimes, the collectors will call third parties without even pretending to get location information.

They call your mother-in-law, they call your child, they call your brother, they call your neighbor. 

They say, “Hey, this person needs to call us back. He owes us money / he’s broken his promises to us / we’re investigating to see if he has assets to seize.”

And this is just a blatant attack.

We used to see this a lot, then it calmed down for a few years, and now it is picking back up again. 

Why do they do this?

They do this because they know it works. 

It’s one thing when a debt collector is blowing up my phone and I decide to block the number. 

When they send letters, I can throw them away. 

Maybe I don’t care if they are on my credit report because I’m not planning to finance anything or seeking security clearance for any reason. 

Whatever the reason is, I don’t care. 

But when they start calling my mother-in-law, my children, my parents, my siblings, my neighbors, my preacher, my boss… this will get my attention. 

In my own mind, I’m thinking, “Wow, this has really escalated.”

Think of it as a scene from a spy movie. 

The bad guys capture the spy and handcuff him to a chair trying to get information out of him. 

They’ll say “Give us the secret code.”

And he’ll say, “I’ll never give you the code!”

The spy continues to refuse, even under threat of torture.

Then the bad guys say, “Alright, if that’s how you want to be…”

And they bring out the spouse, the child, or someone else close to the spy. 

The bad guys say, “We’re going to hurt them you unless you tell.”

So the spy finally cracks and gives them the code.

The point is, when they start threatening us through somebody else, it gets our attention. 

It’s one thing if they decide to harass you or your spouse or your lawyer. 

Remember who does not qualify as a third party?

You, your spouse, and your lawyer. 

That’s it. 

Everyone else is a third party. 

If they start contacting my sister, my father, my coworkers, etc. that’s just a whole other level. 

It’s incredibly illegal.

But it’s also incredibly effective, and that’s why they do it. 

Why are these cases so valuable?

Because this is so damaging and upsetting, these cases can result in very large verdicts. 

The jurors will hear about how damaging this is.

What we do is something called “rules of the road” in our opening statement – this is just a trial technique or strategy. 

I’ll either point to the witness or I’ll point to the corporate representative of the debt collector and say, “This person right here, they have been at this company 20 years, they will get up on that stand and they will tell you that no honorable debt collector would ever contact a third party because that is a terrible violation of the law.”

This isn’t exactly how I would say it in court, but this gives you the gist of what we are trying to say in that opening statement. 

They have to get up and admit this because otherwise, they look like idiots because this is the law. 

Do they admit that this is a terrible thing or do they lie?

Really, if I had my preference, I would prefer that they lie because that just stacks the verdict up even more. 

So this is very, very bad stuff when they are contacting third parties. If you sue for this, you may have a very nice case. 

You can talk to the jury about some really significant damages. 

The jury will say, hey, this is really bad, we’ve got to compensate this person under the FDCPA.

If you have a state law claim, typically something like an invasion of privacy claim, then we can also get punitive damages for that claim. 

Be sure to check out our recent posts concerning debt collectors and third parties.

In case you missed them, be sure to check out these recent posts:

• Who is a third party under the FDCPA? 
• FDCPA: Get a statement when a debt collector calls a third party

It’s so damaging to the consumer when they start contacting relatives and coworkers and neighbors. 

Others come to you and say, “Hey, I see you’re having some financial problems. So’n’so is calling for you, do you need any help with this?”

It’s incredibly embarrassing and absolutely illegal. 

If this is happening to you, take action against these guys and hold them accountable. 

We hope this is helpful to you!

If you live in Alabama and you have any questions, feel free to get in touch with us.

We would be glad to help you in any way we can.

You can reach us by phone at 1-205-879-2447, or you can fill out a contact form and we will get in touch with you quickly. 

Thanks for reading, and have a great day!

-John Watts