Rep. Matt Cartwright (D-Pa.) has introduced legislation to amend the Fair Debt Collection Practices Act, a response to a U.S. Supreme Court ruling last year that a debt collector who prevails in an FDCPA case can be awarded costs at the discretion of a district court even when the suit wasn’t brought in bad faith.

The Fair Debt Collections Practices Clarifications Act, if passed, would ensure that costs are only available to a winning defendant when the plaintiff brings a suit in bad faith or for the purpose of harassment.

"Due to the Supreme Court’s unfortunate decision [in Marx v. General Revenue Corp.], consumers, particularly those who are economically vulnerable, may choose to forego legal action when subjected to abusive and illegal debt collection practices given the potential high costs of losing a suit," said Cartwright. "My legislation would correct the [Supreme Court] decision and restore the original intent of the FDCPA."

The legislation has been referred to the House Financial Services Committee and Committee on the Judiciary.
The following organizations have endorsed the bill: the American Association for Justice, Americans for Financial Reform, Public Citizen, the National Association of Consumer Advocates and the National Consumer Law Center.

"Complaints of illegal and abusive debt collection practices continue to swarm the consumer protection agencies.

Congressman Cartwright’s bill would help to ensure that consumers harmed by abusive debt collection tactics are not deterred from seeking redress under the Fair debt Collection Practices Act," said Christine Hines, consumer and civil justice counsel at Public Citizen, Congress Watch division.

The FDCPA creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors and prescribes penalties and remedies for violations of the Act.  It was signed into law in 1977 by President Jimmy Carter.

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