The Federal Fair Debt Collection Practices Act (FDCPA) and other laws set by state, aim at protecting individuals who seek services of a payday loan lenders. Their main purpose is to disregard abusive practices by payday loan lenders in the collection of debt and provide customers with an opportunity to dispute and get validation and accuracy of debt information. The act also gives guidelines under which lenders conduct business and provide customers with rights and solutions to violations of the Act.
A payday loan scam will every so often try to swindle money by harassing, threatening or using abusive language against a customer. Under FDCPA, scammers should specifically not swear at, threaten or harm you in any way, call you constantly trying to upset you or even call you without revealing their actual identity. Scammers will repeatedly threaten to have you arrested or accused of a crime and some may even threaten to publish your name if you are not able to clear your debt. The Act stipulates that lenders are not supposed to call after set working hours (8:00 a.m. to 9:00a.m), threaten of legal action without authority and publish a customer’s name or address in a “bad debt list”.
Payday loan lenders must send a statement to customers showing total amount owed and the action to be taken if you dispute owing the stated amount within 5 days after initiating contact. If you so dispute the amounts stated then you are required to send a letter within 30 days so that the lender cannot make additional debt collection until you receive proof that you indeed owe the debt. It only leaves to say that if you cannot get an address to write the lender a letter or even if you do get an address and write a letter but the lender keeps calling repeatedly, then most likely you are dealing with a payday loan scam. Further to these actions, Payday loan scams are not allowed to collect any debt owed without verification or a debt in dispute by the customer.
Misrepresentation or deceit to the customer by claiming to be to be attorneys or law enforcement officers is punishable by law. It is the duty of every lender to identify themselves with customers in every communication by giving name and address of the original creditor upon the customer’s request. At the first sign of a violation of the Act a customer should contact the department of commerce, Attorney General’s office and the Federal Trade Commission.