The statute also provides that the term “debt collector” does not include “any person collecting or attempting to collect any debt owed or due or asserted to be owed or due another to the extent such activity . . . concerns a debt which was originated by such person.” See 15 U.S.C. § 1692a(6)(F)(iii). Davidson asserted that Capital One fell within the definition of “debt collector” under § 1692a(6)(F)(iii) because the subject debt was in default at the time it was acquired by Capital One as part of a portfolio of credit card accounts from HSBC.

12 CFR §1006.22(b). 15 U.S.C. §1692f(1); See 12 CFR §1006.2(b) 15 U.S.C. §1692a(5); 12 CFR §1006.2(h) 15 U.S.C. §1692a(6); 12 CFR §1006.2(i)(1). 12 U.S.C. §1692a(6)(F); 12 CFR §1006.2(i)(2)(vi) 15 U.S.C §1692a(6)(B); 12 CFR §1006.2(i)(2)(ii).

Even in theCFPB’s Supervision and Examination materials, they clarify the exemption for certain types of debt, including commercial debt. They list the following areas that are exempt from coverage: A. Debts it originated (15 USC 1692a(6)(F)(ii)); [12 CFR 1006.2(i)(2)(vi)(B)] B. Debts that were not in default when they were obtained (15 USC 1692a(6)(F)(iii)); [12 CFR 1006.2(i)(2)(vi)(C)] C. Debts that were obtained as security for a commercial credit transaction (15 USC 1692a(6)(F)(iv)); [12 CFR 1006.2(i)(2)(vi)(D)] D. Debts if the activity is incidental to a bona fide fiduciary relationship or escrow arrangement (for example, a debt held in the entity’s trust department or mortgage loan escrow for taxes and insurance) (15 USC 1692a(6)(F)(i)); [12 CFR 1006.2(i)(2)(vi)(A)] Major policy shifts to the longstanding areas exempted from FDCPA coverage would trigger extensive new compliance burdens, such as licensing requirements and a host of other steps to ensure FDCPA compliance. FDCPA litigation, which is widespread and includes statutory damages, often focuses on minor technical violations.

Justice Neil Gorsuch took no part in the consideration or decision of the case.Court Rules That Purchaser of DefaultedDebt Is Not "Debt Collector" Under FDCPA In another case construing the FDCPA, but not in a bankruptcy context, the Court ruled on June 12, 2017, in Henson v. Santander Consumer USA Inc., No. 16-349, 2017 BL 198032 (U.S. June 12, 2017), that the purchaser of a defaulted debt is not a "debt collector" subject to the FDCPA. The FDCPA applies to "debt collectors," a term defined in 15 U.S.C. § 1692a(6) as anyone who "regularly collects or attempts to collect . . . debts owed or due . . . another." The term includes "any creditor who, in the process of collecting his own debts, uses any name other than his own which would indicate that a third person is collecting or attempting to collect such debts."

The statute regulates the conduct of debt collectors, which it defines as a business either “the primary purpose of which is the collection of any debts” or that “regularly collects or attempt to collects … debts owed or due … to another.” 15 U.S.C. § 1692a(6). Santander argued that it was not a debt collector because the primary purpose of its business was not debt collection (Santander also originates and services loans) and because here it was not collecting debt owed to another.

Under the FDCPA a “debt collector” is anyone who “regularly collects or attempts to collect . . . debts owed or due . . . another.” 15 U.S.C. § 1692a(6). And relevant here, the definition of “creditor” specifically excludes anyone who “receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another.”

The FDCPA defines a “debt collector” as (1) “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts,” or (2) any person “who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.” 15 U.S.C. §1692a(6). The definition also has six exclusionary categories, one of which is the exclusion of any person who is collecting or attempting to collect on any debt owed or due another if the debt was not in default at the time it was acquired.

The FDCPA defines a “debt collector” as (1) “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts,” or (2) any person “who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.” 15 U.S.C. §1692a(6). The definition also has six exclusionary categories, one of which is the exclusion of any person who is collecting or attempting to collect on any debt owed or due another if the debt was not in default at the time it was acquired.

Notes:[1] Debt Collection by Third-Party Debt Collectors and Debt Buyers Regulation, N.Y. Comp. Codes R. Regs. tit. 23, pt. 1 (available at http://www.dfs.ny.gov/legal/regulations/adoptions/dfsf23t.pdf).[2]See Debt Collection Procedures Law, N.Y. Gen. Bus. Law art. 29-H.[3] 15 U.S.C. § 1692 et seq.[4]Compare N.Y. Comp. Codes R. Regs. tit. 23, §§ 1.1(d)-(e) with 15 U.S.C. §§ 1692a(5)-(6).[5]Compare N.Y. Comp. Codes R. Regs. tit. 23, § 1.1(e)(6)(iii) with 15 U.S.C. § 1692a(6)(F)(iii).[6] 15 U.S.C. § 1692a(6).[7]Id.

This article will provide a short summary of concepts in defending against these actions.I. IntroductionThe Fair Debt Collection Practices Act ("FDCPA" or "the Act") creates guidelines for debt collectors performing the collection of consumer debt and prescribes penalties and remedies for violations of the Act. Violations, can occur upon the first contact and carry a fine of $1,000 each, along with an award for attorney's fees.Definition of "Debt Collector" The prohibitions set forth in the FDCPA only apply to parties who meet the definition of a "debt collector" set forth in 15 U.S.C. § 1692a(6) as follows:The term "debt collector" means any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.The definition includes any person who uses the mail or other instrumentality of interstate commerce to engage in a business the principal purpose of which is the enforcement of security interests.