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Transworld Systems Statement of “Current” Balance FDCPA Class Action

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One Hand Giving Another Money

Congress passed the Fair Debt Collection Practices Act (FDCPA) to stop deceptive and abusive practices in the collection of consumer debts. The complaint for this class action claims that Transworld Systems violated this law when it insinuated that the amount of a consumer debt might rise and that therefore it might be an advantage for the consumer to pay it immediately.

The class for this action is

  • All individuals with addresses in Queens County, New York
  • To whom Transworld Systems sent a letter attempting to collect a consumer debt,
  • Between June 26, 2017 and July 17, 2018,
  • Which fails to clearly state the amount of the debt, by implying that a payment sooner rather than later will be more economical for the consumer, and by employing false, deceptive, and misleading representations.

The FDCPA requires that third-party debt collectors provide consumer debtors with certain information, including the amount they owe. It requires that information provided to consumers be clear and unambiguous. The standard by which this clarity is judged is the “least sophisticated consumer.”

Plaintiff Yoseph Meyrov allegedly owes money to Enterprise Rent-A-Car, for personal, family, or household purposes.

At some point, the debt was assigned to third-party debt collector Transworld Systems for collection. Transworld sent Meyrov a letter for this purpose, on or around October 20, 2017. A copy of the letter is attached to the complaint as Exhibit A.

The letter states that the “Current Balance Due” is $819.23. The complaint claims that the use of the word “current” implies that the balance may change, or increase, at a later date. Meyrov, the complaint says, could not be certain whether the amount was still increasing or not.

Normally, debt collection letters cite an “Amount Due” or an “Account Balance,” the complaint says. If the amount of the debt is actually going to increase due to interest or fees, the complaint says, the FDCPA requires that the debt collector state that plainly to the consumer. In either case, the complaint says, the letter is unclear and misleading.

The complaint quotes the FDCPA as saying, “A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.” It provides a list of examples of such misleading representations or means, including, “the false representation of … the character, amount, or legal status of any debt…”

The complaint also claims, “Collection notices are deceptive if they can be reasonably read to have two or more different meanings, one of which is inaccurate.” It says that this is the case with the letter, in which the use of the word “current” in stating the balance could imply that the amount of the debt may still go up.

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