Call calling a wrong number while trying to collect on unpaid invoices really land you in a lawsuit?
The short answer is YES.
And it comes down to understanding the compliance requirements of two important pieces of legislation: the Fair Debt Collection Practices Act and the Telephone Consumer Protection Act (TCPA).
Debt collection rights for consumers
In case you didn’t know the Fair Debt Collection Practices Act is a federal law that establishes rules that third-party debt collectors must follow.
And in a timely article published on credit.com, the author outlined the top 10 collection rights protecting consumers from businesses and collection agencies seeking to collect on their behalf.
Of the ten that made the list there are 3 rights that seemed most relevant to dialing a wrong number.
- No Repeated or Continuous Calls
- A Debt Collector Must Send Written Notice of a Debt
- A Debt Collector Must Honor a Written Request for No Further Contact
When you attempt to collect on an unpaid invoice (or invoices) you are, in essence, acting as your own debt collection agency. So it doesn’t matter when former (or current) customers, clients or patients owe you money. Though you are entitled to collecting what is rightfully yours for services rendered, the laws that protect consumers must be followed.
To the letter (no pun intended).
And the three rights posted above are all relevant to your situation. Simply put, you cannot call numerous times a day attempting to collect an unpaid bill.
What’s more, you have 5 days to send out written notice informing the person who owes you money what the amount is, along with what steps to take if they believe that they don’t owe you anything. In other words, it’s not enough to simply call. You have to follow a procedure to make sure you are within compliance.
Finally, if your customer or client send you a written notice to cease and desist all contact you have to stop all further contact. That doesn’t mean that the debt is forgiven, but you are not allowed to contact them regarding that debt anymore.
And I shouldn’t have to point out to you that failing to remain within compliance puts you at risk.
Important changes to the TCPA
Another recent article highlighted an ABC investigation regarding the TCPA and it’s impact on the economy.
Specifically, they were investigating law suits involving the TCPA and companies dialing wrong numbers. And during their investigation they did come across several lawsuits against large firms, including (no surprise) debt collection agencies.
It goes without saying that we live in a very litigious society these days.
And even the folks who owe you money aren’t immune from taking you to court should you violate a single collection law. What’s more frustrating, however, is getting sued by someone for simply dialing the wrong number.
And if you think that the person you call by accident will be sympathetic of your need to collect what’s rightfully yours, think again.
In fact, according to Gordon Beck, Chief Operating Officer of Diversified Consultants, Inc., “the [ABC] interview was based on several topics including this lawsuit we had for dialing a wrong number, the TCPA and the impact it has on the financial services industry, and the overall challenges we face in this litigious environment of credit and collections.”
Today, more than ever, there’s a “Robin Hood” mentality of taking from the rich to give to the poor.
You would be hard pressed to explain that you made a mistake, or that you’re not a collection agency. Collection calls, even mistaken ones, upset the people who get them, even when they don’t have any outstanding payments or bills.
That, on it’s own, is reason enough for outsourcing your collection headaches to a firm better suited to deal with compliance.
And possible lawsuits.
Find a debt collection agency today
To find a collection agency that specializes in working with businesses like yours, simply request a free services quote from qualified and reputable companies.
Click the link and compare free collection agency quotes today.
This way you can save time, money and aggravation by hiring a professional who can help you collect some (or all?) of your outstanding accounts receivable.
After all, when you get down to it you really have two choices:
- you can keep doing what you’re doing (and hope for a different result), or
- you can find a commercial collections agency that can help you recover what’s rightfully yours.
Either way it’s your money… you decide.