Has a Debt Collector Withdrawn Money From Your Bank Account?
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General Rule: Unless permitted by a court, any money taken from your account violates the Fair Debt Collection Practices Act (FDCPA). Even if they have a judgment, there are certain restrictions.
Dealing with a debt collector can be a stressful ordeal. They are likely to send you letters, call you and even appear at your house. These communications alone from a debt collector may make you anxious.
However, what do you do if a debt collector starts withdrawing money from your account? Well, the answer is it depends. As a consumer with personal debt, you have certain protections under the Fair Debt Collection Practices Act (FDCPA). This federal law protects you against a variety of abusive, deceptive and otherwise unlawful third-party debt collection behavior.
This article will explain why a debt collector may have taken money from your bank account and whether or not it is lawful. If it is not lawful, there are steps described below that you can take to stop the illegal behavior.
A Debt Collector Took Money From Me Without My Permission
There are certain situations where a debt collector taking money from your account may have outright violated the law. A debt collector cannot submit documents to a bank to seize your assets without a judgment and permission from the court. This is illegal and, if it occurs, you have the right to sue the company and hold them liable.
However, there are situations where a debt collector has authorization to seize assets from your bank account. Sometimes, a collection agency will sue a person for a debt they owe. If the court awards them a judgment, they are free to collect on that judgment. In certain cases (e.g., a car loan) they may seize the property that has a debt secured by it.
In other scenarios, they will collect on that judgment through wage garnishment or seizing assets from your bank account. How they go about seizing assets from your bank account and other restrictions is typically based on state law. However, there are certain federal restrictions. For instance, a debt collector may only seize a certain amount if the bank account contains certain social security benefits.
Protection Under the FDCPA from Illegal Debt Collection Actions
The FDCPA provides broad protections against third-party debt collectors. These protections include prohibitions on harassment, deception and other forms of abuse.
Those protections include prohibitions on ways in which a debt collector may deceptively try to collect on a debt. If a debt collector makes any misrepresentations to a bank or other party to collect on a debt, they violate the FDCPA.
Note: If unauthorized and done by a third-party debt collector, the debt collection is a violation of the FDCPA. The protections provided by the FDCPA do not extend to the original creditor.
What Should I Do If a Collection Agency Illegally Takes Money From My Bank Account?
If a debt collector is illegally withdrawing money from your account there is action you can take.
The most effective solution for such a serious violation is to file a lawsuit to stop them. The court can intervene and grant injunctive relief to put the unlawful behavior to a stop. In addition, they can compensate you if your case is successful. This would include:
- Actual Damages. Actual damages include any funds that were illegally seized from your bank account. Other damages may include if you were unable to pay certain bills because you did not have any assets in your bank account.
- Statutory Damages. Under the FDCPA the court will award an additional penalty of up to $1,000 for a violation.
- Court Costs. Any filing fees or attorney fees are now the responsibility of the collection agency.
- Punitive Damages. Depending on the severity of the debt collector’s action, a court may award additional punitive damages.
This type of illegal situation can cause damage quickly. Immediately consult with an attorney if a debt collector is illegally seizing funds from your bank account.
In addition, consider reporting the collection agency to the appropriate federal agencies. For violations of the FDCPA, you can submit a complaint to the Federal Trade Commission (FTC). You can also submit a general consumer complaint to the Consumer Financial Protection Bureau (CFPB).
Conclusion
Both debt collectors and consumers have rights. A consumer has a right to avoid harassment and other abuses from collection agencies. A collection agency has the right to a lawful payment of debt and may collect on a judgment.
If you believe a debt collector is illegally withdrawing money from your account, contact a consumer rights attorney immediately. They can put a stop to any illegal withdraws and make sure you get back any money that was wrongfully taken.
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