FDCPA Requires Notice Prior to Bank Withdrawal

FDCPA Requires Collection Agencies to Give Consumer Notice Prior to Taking Monthly Withdrawals From Bank Account

Many consumers enter into payment agreements with collection agencies where the agency will take month payments from the consumer's bank account to pay off the debt. However, in order to take these automated and post dated payments, the collection agency must first sent written notice not more than 10 nor less than 3 business days before the withdrawal. So if a payment is scheduled to come out on the 15th of the month, the agency should be sending a letter sometime between the 1st and the 10th of the month. Most important, is that the debtor be given sufficient notice to make sure funds will be available in the bank account, and if they are not, sufficient time to notify the agency to not take the withdrawal.

Failure to Give Proper Notice of an Automatic Withdrawal Violates the FDCPA

A collection agency or law firm which fails to provide a debtor with adequate notice of an upcoming withdrawal from a bank account violates the Fair Debt Collection Practices Act, or FDCPA. The FDCPA provides consumers with claims for damages for these types of violations.

Arizona Consumer Sues National Credit Systems, Inc. for Failure to Give Written Notice Prior to Taking Automatic Bank Withdrawals

My office recently filed suit in Federal Court alleging National Credit Systems, Inc. failed to provide notice adequate notice to the debtor prior to taking out pre-authorized monthly debits from her bank account. Such failure to give proper notice violates the FDCPA.