Illinois federal court finds collection letter listing interest and other charges as $0 is not misleading under the FDCPA

The debtor in Delgado v. Client Servs., Inc., No. 17 C 4364 (N.D. Ill. Mar. 7, 2018) sued the debt collector under the FDCPA by sending a misleading letter regarding a dunning letter that reference the balance due at charge-off “2,619.26”, interest at “0.00”, other charges at “0”, payments made “20.00” and a current balance, and a current balance of “2,599.26”. The debtor alleged that the letter was misleading in light of the fact that “interest” and “other charges” were itemized in the letter, interest and charges would begin accruing on the alleged debt if he did not pay it.

The court dismissed the suit finding the letter was not misleading on its face. The court found the language of the letter was clear. It displays the amount due at the top, and includes an itemization in the body of the letter, including “Interest: 0.00” and “Other Charges: 0.00.” Rather than making a false, misleading, or deceptive statement, the letter set forth the amount due and provides an accounting of that amount, making it explicit that no part of the amount due includes interest or other charges. “[A]n itemization accounts for what is and is not included in a total balance. An itemization of zero shows that the balance due does not include interest or other charges…”. This is exactly what the letter reflected. The FDCPA does not require a debt collector to note that an amount will not increase; “there is no requirement that every statement in a debt collection notice include an extra assurance that the fact stated will not change in the future.”

The debt collector did precisely what the Seventh Circuit recommends by clearly itemizing the various components of the debt. “To find otherwise places debt collectors between a rock and a hard place, where they cannot simply list the amount owed, for fear of being misleading, but likewise, cannot breakdown the amount into categories either, for fear of being misleading. Debt collectors would be damned if they do and damned if they don’t. This is clearly not what Congress intended the FDCPA to do—essentially turn debt collectors into a modern-day version of Goldie Locks, who cast about searching for the letter that is just right, not listing too little information or too much.”

There was also no suggestion that the amount due will change if the balance is not paid within a certain period of time and no other mention of interest and other charges. Most convincingly, the letter indicates that debtor had already begun repaying his debt at the time he received the letter, and still the interest and other charges remained at zero. If he believed the letter was threatening to assess interest and collection fees, it would not make sense that the amounts remained at zero after collection had already begun.

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