Recent Sixth Circuit Decision Provides Standard for FDCPA Verification for Debt Collectors

The Sixth Circuit recently expanded the requirement for how a debt collector must respond to a debtor’s request for verification of a debt under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”).  In Haddad v. Alexander, Zelmanski, Danner & Fioritto, PLLC, the Sixth Circuit created a very consumer-friendly verification standard that could create endless opportunities for debtors to demand more verification information from a debt collector.

In Haddad, a consumer provided a law firm debt collector a written dispute within 30 days of receiving an initial demand letter for a delinquent condominium assessment bill.  The law firm provided verification by sending an accounting ledger showing the amounts encompassing the total and a letter explaining the charges.  Thereafter, the consumer responded by disputing the beginning balance of $50 and the subsequent fees.  The law firm again responded with a letter and ledger providing more detail about the charges. 

The consumer replied again demanding further validation of the $50 balance.  The law firm sent a third letter which itemized the debt but did not explain the beginning $50 balance.  The law firm also enclosed a copy of a lien that it later placed on the debtor’s condo.  Haddad sued the law firm under FDCPA § 1692e and § 1692g(b) claiming the law firm did not properly validate the debt before resuming collection activity.

Under FDCPA § 1692g(b), if a consumer notifies a debt collector in writing within thirty days of receiving the § 1692g(a) notice that the consumer disputes the debt or any portion thereof, the debt collector is required to stop collecting on the debt, or the disputed portion of the debt, and must obtain verification of it and mail that verification to the consumer.  While “verification” is not defined within the FDCPA, many district courts have construed the meaning to simply mean that the debt collector must confirm in writing that the amount being demanded is what the creditor is claiming is owed. 

The Sixth Circuit rejected the other district court’s approach and created a new standard for verification holding that “the verification provision must be interpreted to provide the consumer with notice of how and when the debt was originally incurred or other sufficient notice from which the consumer could sufficiently dispute the payment obligation.”  The Sixth Circuit further clarified that the information used to verify a debt “does not have to be extensive.  It should provide the date and nature of the transaction that led to the debt, such as a purchase on a particular date, a missed rentalpayment for a specific month, a fee for a particular service provided at a specified time, or a fine for a particular offense assessed on certain date.”  In Haddad, the court determined that the law firm debt collector failed to provide a valid verification because it did not explain the $50 charge and instead continued its collection efforts.

While the Sixth Circuit’s new standard depends on the facts of a particular situation, it creates problems for debt collectors because it could potentially create endless opportunities for debtors to demand further verification of a debt so as to avoid paying.  For more information on this subject, contact Stephanie Strickler at