The Middle District of Pennsylvania recently held that including line items for interest and fees in a debt collection letter when no interest or fees are sought does not violate the Fair Debt Collections Practices Act (“FDCPA”).
In Reyes v. Associated Credit Servs., No. 1:19-CV-01670 (M.D. Pa. July 6, 2020), the plaintiff received a letter from the defendant debt collection company, Associated Credit Services, Inc. (“ACS”), seeking to collect a consumer debt. In addition to the principal balance due, the letter listed $0.00 as the amount due for interest and fees. Reyes filed suit alleging the letter was misleading and deceptive because, by specifying that she owed $0.00 in interest and fees, ACS improperly threatened or implied that it could (or would) charge interest and fees in the future. Based on this, she asserted claims for violation of the FDCPA under Section 1692e, which prohibits the use of false, deceptive, or misleading representations in connection with the collection of a debt, and Section 1692f, which prohibits using unfair or unconscionable means to collect on a debt.
In granting summary judgment in favor of ACS, the Court rejected these claims, finding the line items were merely a breakdown of Reyes’s balance. Applying the least sophisticated debtor standard, it determined that the letter was not misleading, holding “an unsophisticated consumer would not interpret line itemizations of ‘Interest: $0.00’ and ‘Fees: $0.00,’ without more, as a threat or implication that it could or would charge them in the future.” Further, the Court found the letter contained no implicit or explicit threats or any other statements that could be reasonably construed as unfair or unconscionable.
This decision takes a common-sense approach. Merely providing an accurate breakdown informing a consumer that there are no fees or interest charges included in the debt being collected does not give rise to a claim under the FDCPA.