Ninth Circuit Rules Every Debt Collector Must Send Verification Notice

In a case of first impression, the U.S. Court of Appeals for the Ninth Circuit held in July that all debt collectors must send debtors a verification notice. “In other words, if there are multiple debt collectors that try to collect a debt, each one must send the required notice after its first communication with the alleged debtor about the debt,” the Court said.

Specifically, the verification provision, § 809 of the Fair Debt Collection Practices Act (“FDCPA”), provides that a debt collector must send a notice to the debtor stating that if “the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector.”

In this case, Hernandez v. Williams Zinman Parham PC, the plaintiff stopped paying a car loan, and numerous debt collectors were involved in collecting on the amount owed. The plaintiff alleged that the defendant violated the FDCPA by not giving her a verification notice. The defendant’s position was that it did not have to send a verification notice because a previous debt collector already provided her with such a notice.

The Ninth Circuit is the first to rule that the FDCPA requires every debt collector to send a verification notice, regardless of whether the debtor received such a notice from a previous debt collector on the same debt. The Court reasoned that if only the first debt collector sent the verification notice, then the consumer’s ability to dispute the debt would be restricted. “Having applied the tools of statutory construction, we hold that the FDCPA unambiguously requires any debt collector — first or subsequent — to send a … validation notice within five days of its first communication with a consumer in connection with the collection of any debt,” the Court said.

The Consumer Financial Protection Bureau and the Federal Trade Commission filed an amicus brief, asking the Ninth Circuit to hold that the FDCPA requires all debt collectors to send a verification notice.