WASHINGTON, D.C. -

With ACA International questioning how officials arrived at these figures, the Federal Trade Commission recently submitted its Congressional report summarizing activities to administer the Fair Debt Collection Practices Act.

The FTC discovered the total number of consumer complaints associated with debt collection rose from 119,609 in 2009 to 140,036 last year. As a percentage of all complaints that landed at the FTC, officials determined debt collection grievances constituted 27.0 percent of all commission cases, up from 22.8 percent during the previous year.

The top six reasons for consumers complaining to the FTC about debt collectors remained the same for both 2009 and 2010. Here are those top six with the amount of 2010 cases:

—Repeated calls: 54,147.

—Misrepresent debt, character, amount or status: 33,122.

—No written notice: 32,477.

—Falsely threatens illegal or unintended act: 27,544.

—Fails to identify as debt collector: 24,889.

—Repeated calls to third parties: 23,758.

FTC reiterated that its Congressional report is all part of activities to curtail deceptive, unfair, and abusive debt collection practices in the marketplace. The commission contends such practices cause substantial consumer injury, including payment of amounts not owed, unintended waivers of rights, invasions of privacy and emotional distress.

In some circumstances, officials think illegal collection practices can place consumers deeper in debt.

“The FDCPA prohibits deceptive, unfair, and abusive practices by third-party collectors,” officials reminded the industry.

“For the most part, creditors are exempt when they are collecting their own debts. The FDCPA permits reasonable collection efforts that promote repayment of legitimate debts, and the FTC tries to ensure compliance without unreasonably impeding the collection process,” they went on to say. “The FTC recognizes that the timely payment of debts is important to creditors and that the debt collection industry assists creditors in collecting what they are owed. The FTC also appreciates the need to protect consumers from debt collectors who engage in deceptive, unfair and abusive collection practices.”

The FTC recently levied the largest civil penalty in a debt collection case against a collection company for allegedly using aggressive techniques that violated federal law.

Last month, the commission alleged that West Asset Management violated the FDCPA and said the company agreed to pay a civil penalty of $2.8 million to settle charges.

According to FTC documents, thousands of consumer complaints have been filed against West Asset Management, which employs 1,500 debt collectors in 13 states and one offshore location. Officials contend West Asset Management debt collectors allegedly violated the Fair Debt Collection Practices Act by calling consumers multiple times each day, often regarding accounts that did not belong to them, and sometimes using rude and abusive language.

The FTC further charged that West Asset Management also illegally disclosed the existence of consumers’ debts to third parties and ignored consumers’ written demands that West Asset Management stop calling them.

More History Behind FDCPA Reporting

Officials recounted the FDCPA requires the FTC to report on the level of industry compliance with the law. The FTC indicated it receives copious information about the conduct of debt collectors from complaints consumers file with the FTC and from its enforcement work.

The commission explained that it uses complaints generally to monitor the industry, select targets, and conduct preliminary analysis that, with further factual development, might reveal or help prove a law violation.

“Based on the FTC’s experience, many consumers never file complaints with anyone other than the debt collector itself,” officials shared. “Others complain only to the underlying creditor or to enforcement agencies other than the FTC.

“Some consumers may not be aware that the conduct they have experienced violates the FDCPA or that the FTC enforces the FDCPA,” they continued. “For these reasons, the total number of consumer complaints the FTC receives may understate the extent to which the practices of debt collectors violate the law.

“On the other hand, the FTC acknowledges that not all of the debt collection practices about which consumers complain are necessarily law violations,” officials conceded. “Many consumers complain of conduct that, if accurately described, would indeed violate the FDCPA. The FTC, however, does not verify whether the information consumers provide is accurate unless the agency undertakes such an inquiry in connection with its law enforcement activities.”

ACA International Reacts to FTC Findings

Soon after the FTC released its report, ACA International Interim chief executive officer Ted Smith reiterated the industry association’s position about debt collection complaints.

“Debt collectors take very seriously the issue of consumer complaints and agree on the significant importance of protecting consumers against any business that engages in deceptive, unfair or abusive practices,” Smith stressed.

“ACA International will continue to provide educational and training resources to help our members, and their employees, comply with the FDCPA and other federal and state laws that regulate debt collection,” he continued.

After making those points, Smith went on to emphasize, “The recovery of rightfully owed consumer debt is an essential component of our nation’s economic engine.

“It’s no secret that the collection of debt is a challenging proposition,” Smith stated. “It’s the job of hundreds of thousands of professionals to carefully work with consumers under stressful circumstances to verify and help consumers resolve their personal responsibility to pay an outstanding debt.”

While ACA International described what it called an “appreciation” for the FTC tracking this data, association leaders believe the FTC’s complaint methodology paints “an interesting but incomplete and inaccurate portrait of consumer complaints against the third-party collection industry.”

ACA International outlined its positioned using three points:

—The association believes the FTC report does not factor in the dramatic consumer debt crisis that exists in America, which has been exacerbated by an economic recession over the past three years that created more consumer credit defaults than in any other time in history.

“The volume of consumer debt that debt collectors seek to recover has grown significantly and consumer contacts may now number in the billions,” Smith indicated. “This is a significant impact that cannot be ignored.”

—Next, ACA International thinks the complaint data is actually comprised of both inquiries and complaints, meaning there is no regard for whether the consumer is contacting the FTC with a question or a legitimate complaint.

“And, the FTC has acknowledged that ‘not all of the debt collection practices about which a consumer complain are law violations,’” Smith reiterated.

—Finally, ACA International pointed out the FTC does not share consumer contacts with debt collectors so they may seek to resolve legitimate complaints.

“When given the opportunity, debt collectors want to work with consumers to resolve complaints,” Smith declared.

“According to the Better Business Bureau, debt collectors resolve 85 percent of the complaints received against them — significantly higher than other industries,” he continued.

“ACA International members are working with regulators, Congress and state leaders to ensure a balanced debt collection system that allows for legitimate debt collection to function and protects consumers,” Smith went on to say. “We believe that consumers deserve respect in the legitimate collection of debt and that harassment, threats and other illegal activity are unacceptable and violators must be held accountable.”