FDCPA Fix for Attorneys Gets Companion Bill in U.S. Senate

Capping off a very busy week for debt collection legislative watchers, U.S. Senator Pat Toomey (R-Pa.) introduced a bill with bi-partisan support that exempts from the FDCPA collection attorneys, but only when those attorneys are taking certain actions. The proposal mirrors a current House bill that has been gaining steam.

Sen. Toomey’s bill — S. 2328 — would “amend the Fair Debt Collection Practices Act to preclude law firms and licensed attorneys from the definition of a debt collector when taking certain actions.” The bill was referred to the Senate Committee on Banking, Housing, and Urban Affairs. It currently has one co-sponsor, Sen. Mark Warner (D-Va.).

Joann Needleman, President of the National Association of Retail Collection Attorneys (NARCA), noted that bi-partisan support is a crucial element of the legislation.

“We would like to commend Senators Toomey and Warner for their sponsorship of this important measure,” said Needleman.  “Like the companion bill in the House, S. 2328 is a commonsense fix that should continue to gain support from both sides of the aisle.”

The Congressional Printing Office has yet to publish the full text of the bill, but the title language is identical to that of HR 2892, the “Fair Debt Collection Practices Technical Clarification Act of 2013.”

That bill offers a highly technical fix to the FDCPA that would exclude from the definition of “debt collector” any law firm or licensed attorney:

1. serving, filing, or conveying formal legal pleadings, discovery requests, or other documents pursuant to the applicable rules of civil procedure; or
2. communicating in, or at the direction of, a court of law or in depositions or settlement conferences, in connection with a pending legal action to collect a debt on behalf of a client.

Introduced in late July 2013, HR 2892 got some press recently as more Representatives signed on as co-sponsors.

The House bill has been heavily supported by NARCA. The group has noted that the bill offers a very technical fix to the FDCPA and would apply only when collection attorneys are “engaged in litigation practice within the purview of a court.” All other communications from collection attorneys must still comply with the FDCPA, according to the group.