Late last year, the Eighth Circuit held that a debt collector did not violate the Fair Debt Collection Practices Act (FDCPA) when it responded to an inquiry from a consumer reporting agency (CRA), confirming that a consumer owed a debt but without also advising that the consumer had disputed the debt.
The debtor alleged that the debt collector violated Section 1692e(8) of the FDCPA, which prohibits “false, deceptive, or misleading representation or means, in connection with the collection of any debt.” The District Court (Minnesota) granted the debt collector’s request for judgment on the pleadings because the debtor did not assert that the contested communication with the CRA was both “false, deceptive, or misleading” and “in connection with the collection of any debt.”
The Eighth Circuit affirmed, holding that a false statement does not violate Section 1692e if it would not mislead “an unsophisticated consumer.” Here, the recipient of the debt collector’s purportedly false statement was not even a consumer (eg, the debtor); rather, it was the CRA. Further, the statement at issue could not have misled the CRA. The CRA already knew that the debt was disputed by virtue of the debtor’s report to the CRA, which is what led the CRA to initiate contact with the debt collector.
Thus, the Eighth Circuit joins several other Circuits, including the Sixth, in requiring that for a communication to be “in connection” with collection, “an animating purpose of the communication must be to induce payment by the debtor.” Here, the only “animating purpose” of the debt collector’s communication with the CRA was to respond to an inquiry from the CRA itself, and not to induce payment. It is important, however, to note that this decision does not alter the well-established law that, when voluntarily furnishing information to a CRA, a debt collector may be liable under Section 1692e(8) for not informing the CRA that the account is disputed.
McIvor v. Credit Control Services, Inc., — F.3d —, No. 14-1164 (8th Cir. Dec. 14, 2014)