The Fair Debt Collection Practices Act prohibits debt collectors from using false, misleading, abusive, and harassing tactics to collect debts. Under the FDCPA, any person who has been subjected to illegal debt collection practices may sue the debt collector to hold it accountable and enforce the law. If successful, the plaintiff is entitled to $1,000 in statutory damages and the collector must pay her reasonable attorney fees and costs. More importantly, the collector may also be responsible for compensating the person for any emotional distress that she has suffered from the illegal collection tactics. Commons symptoms of emotional distress caused by illegal collection practices include:
Loss of sleep
Loss of appetite
Headaches, vomiting, or stomach pain
Problems concentrating at work
While many debt collectors profess cold-hearted skepticism that a person could be so upset by collection efforts, I've worked with many clients who suffered from emotional distress symptoms. I had one client who spent many sleepless nights crying in her bedroom because a collector was pursuing her for a debt she already paid. Another client suffered from severe anxiety, nausea, and headaches because a collector pursued her for a debt she didn't owe. So I know for a fact that illegal debt collection practices cause emotional distress.
The law says that a collector has to pay for the emotional damage their harassing or abusive collection tactics caused. While medical evidence is usually helpful in proving the extent and cause of the emotional distress, most courts don't require it. In most cases, it is sufficient for the person to testify in detail about their emotional distress symptoms. Often, a witness, such as a spouse, co-worker, or friend has seen the symptoms and can corroborate the plaintiff's testimony.
Depending on the severity and duration of the emotional distress, the amount of damages awarded can be significant.
For example, in Fausto v. Credigy, the collector made repeated calls and false threats of credit reporting over a Wells Fargo account. The Faustos believed that they had already paid off the account and told the collectors to stop calling. The collector continued to call--over 90 times in total. At trial the Faustos testified that they had many sleepless nights, an inability to eat, and the stress caused problems within their family. Ultimately, a Northern California jury awarded the Faustos $100,000 for emotional distress caused by the collector's harassment.
In another case, McCollough v. Johnson, Rodenburg & Lauinger, a collection law firm filed a lawsuit that was barred by the statute of limitations. The law firm, JRL, had information from its client that the suit was time-barred, but continued to prosecute it for 8 months. At trial, McCollough testified that JRL's wrongful lawsuit caused him anxiety, pain, increased temper, and conflict with his wife. Although McCollough already suffered from a disabling pre-existing condition due a traumatic brain injury, he characterized JRL's suit as the straw that broke the camel's back. A Montana jury awarded McCollough $250,000 for the emotional distress caused by JRL.
In another case, Yazzie v. Law Offices of Farrell & Seldin, a collection law firm tried to garnish the wages of Lucinda Yazzie, despite repeated notice that the debt was actually owed by someone else with the same name but with a different social security number. The law firm had changed the social security number in its files from the SSN of the correct account holder, to Ms. Yazzie's. Farrell & Seldin's collection attempts continued for three years. The New Mexico jury awarded Ms. Yazzie $161,000 for her emotional distress suffered during the three years of being wrongfully pursued for a debt that wasn't hers.
Similarly, in Mejia v. Portfolio Recovery Associates, a debt buyer sued the wrong person for a $1,000 credit card account. Ms. Mejia repeatedly told them it wasn't her debt, but the debt buyer persisted with the lawsuit. Ms. Mejia testified that the lawsuit terrified her and that she feared she would lose her house or be arrested. A Missouri jury awarded Ms. Mejia $250,000 for emotional distress.
Of course, these cases all involved particularly egregious collection conduct and severe emotional distress. Obviously, not every case results in these kind of damages.
But if you've endured illegal collection practices that caused you stress, anxiety, fear, or other symptoms of emotional distress, the law may require the collector to be accountable for your suffering.