11th Circuit says Proof of Claim is Attempt to Collect a Debt.

If its late its barred

by FDCPA
Posted on August 14, 2015 by Neil Garfield

Just a moment while I am on the run. Hat tip to my clients who sent me this. It might be time to take a harder look at
making claims under FDCPA.
In Crawford v. LVNV Funding, LLC, the Eleventh Circuit held that the creditor violated the Fair Debt Collection
Practices Act (FDCPA) by filing a proof of claim to collect a debt that was unenforceable because the statute of
limitations had expired.
In Crawford, a third-party creditor acquired a debt owed by the debtor from a furniture company. In affirming the
bankruptcy courts dismissal, the district court found that the third-party creditor did not attempt to collect a debt from
the debtor because filing a proof of claim is merely a request to participate in the distribution of the bankruptcy
estate under court control. Furthermore, the district court found that, even if the third-party creditor was attempting to
collect the debt, the third-party creditor did not engage in abusive practices.On appeal, the Eleventh Circuit
reversed, holding that the third-party creditor violated the FDCPA by filing a stale claim in the bankruptcy
court.
Circuit courts are split as to whether the Bankruptcy Code displaces the FDCPA in the bankruptcy context. Some
Circuits have concluded that the Bankruptcy Code displaces the FDCPA in the bankruptcy context. The Second
Circuit held that the FDCPA is not needed to protect debtors who are already under the protection of the bankruptcy
court, and there is no need to supplement the remedies afforded by bankruptcy itself.
In Crawford, Eleventh Circuit ruled against the creditor based on FDCPA without discussing the preemption issue in
this case. The Eleventh Circuit noted that Congress enacted the FDCPA in order to stop the use of abusive,
deceptive, and unfair debt collection practices by many debt collectors. In reaching its decision, the Eleventh Circuit
stated that the FDCPA regulates the conduct of debt-collectors, which is defined as any person who regularly
collects debts owed or due or asserted to be owed or due another.. The creditor did not dispute that it was a debt
collector and thus subject to the FDCPA.
The Court referred to the Section 1962(e) of the FDCPA, which provides that[a] debt collector may not use any
false, deceptive or misleading representation or means in connection with the collection of any debt.
Because Congress did not provide a definition for the terms unfair or unconscionable, the Court adopted a leastsophisticated consumer standard to determine whether the creditor had violated FDCPA.
In Crawford, the creditor filed a time-barred proof of claim because [a]bsent an objection from either the Chapter
13 debtor or the trustee, the time-barred claim is automatically allowed against the debtor pursuant to 11 U.S.C.
502(a)-(b) and Bankruptcy Rule 3001(f). Indeed, in Crawford, neither the trustee nor the debtor objected to the claim
in the bankruptcy case, and the trustee disbursed the money to the creditor. The Eleventh Circuit reasoned that a
debt collectors filing of a time-barred proof of claim, similar to the filing of a stale lawsuit, creates the misleading
impression to the debtor that the debt collector can legally enforce the debt. Therefore, the Eleventh Circuit found
that under the least-sophisticated consumer standard, the creditors filing of a time-barred claim in debtors
bankruptcy Chapter 13 case was unfair, unconscionable, deceptive, and misleading within the broad
scope of the FDCPA
The Crawford decision allows debtors and their attorneys to receive damages from debt collectors who file
time-barred proof of claims.Congress provided consumer debtors with a private right of action, rendering debt
collectors who violate the [FDCPA] liable for actual damages, statutory damages up to $1,000, and reasonable
attorneys fees and costs.
Creditors should be especially careful to not file any time-barred proof of claims in jurisdictions that allow
FDCPA claims. Moreover, if the debtor files a bankruptcy proceeding in a jurisdiction where FDCPA claims are
allowed, he should review every proof of claim filed in his estate. If a creditor files a time-barred claim, the
debtor should object to the claim. Furthermore, the debtor should file an action against the creditor under
the FDCPA.

Even if the debtor or the trustee failed to object to the time-barred claim and paid off the stale debt, as was the case
in Crawford, the debtor should be able to recover under the FDCPA. Alternatively, if the debtor files a bankruptcy
proceeding in a jurisdiction where FDCPA claims are unavailable, the debtor should review filed proof of claims and
object to any stale claims despite the unavailability of statutory damages and attorneys fees. Whether or not FDCPA
claims are available in a jurisdiction, debtors should be vigilant since creditors may continue to file stale proof of
claims because the debt they are able to recover may be more than the damages they pay out in violation of the
FDCPA.
See generally Crawford v. LVNV Funding, LLC, 758 F.3d 1254 (11th Cir. 2014).
See Id. at 1257.

1.

johngault, on August 15, 2015 at 3:08 am said:

Even if the . . . law firm intended the letter and documents to

give the Reeses notice of the foreclosure, they also could have
and did demand payment on the underlying debt. . . . A
communication related to debt collection does not become unrelated
to debt collection simply because it also relates to the enforcement
of a security interest. A debt is still a debt even if it is
secured.
The Reese opinion notes the rule that the law firm asked us to adopt the same rule AHMSI is asking us to adopt
here would exempt from the provisions of 1692e any communication that attempts
to enforce a security interest regardless of whether it also attempts to
collect the underlying debt. Id. at 583. We noted that proposed rule would create a big loophole in the FDCPA: The
practical result would be that the [FDCPA] would apply only to efforts to collect unsecured debts. Id. at 583.
Based on the reasoning of Reese, it is apparent an entity that regularly attempts to collect debts can be a debt
collector beyond 1692f(6) of the FDCPA, even when that entity is also enforcing a security interest.
BIRSTER v. AMERICAN HOME MORTG. SERVICING, 481 Fed.Appx. 579 (11th Cir. 7-18-2012) , citing Reese v.
Ellis, Painter, Ratterree &
Adams, LLP, 678 F.3d 1211 (11th Cir.2012).

2.
Hammertime, on August 15, 2015 at 2:59 am said:

Louise exactly right they shifted blame with bailouts then got get out of jail card w settlements but no third time is the
charm w TILA, Ocwen etc. Theyre too arrogant to change and still think they can do what they want or they have to
keep scam going with their enablers in courts and government. But the people tgat were asleep or too scared have
woken up and are pissed off!

3.
johngault, on August 14, 2015 at 10:28 pm said:

Colorado mines are (last week) spewing nasty amts of sludge and minerals onto land and waterways (this mess was
said to be 100 miles long). Suppose Uncle Hank gave you the land on which 3 of these mines sit and recorded deeds
to you, but you didnt know it. That was 4 years ago, and now some bureau is after you, the registered land owner, for
the cost of clean up, which happens to exceed 10 million U.S. dollars. Uncle Hanks been diseased for 2 years now.
Think it matters to you whether you accepted his deeds or not?! These stinking instruments require delivery and
acceptance.

4.
johngault, on August 14, 2015 at 10:19 pm said:

15 U.S.C. 1692e. False or misleading representations

A debt collector may not use any false, deceptive, or misleading
representation or means in connection with the collection of any debt.
Without limiting the general application of the foregoing, the following
conduct is a violation of this section:
(1) The false representation or implication that the debt collector is
vouched for, bonded by, or affiliated with the United States or any State,
including the use of any badge, uniform, or facsimile thereof.
(2) The false representation of
(A) the character, amount, or legal status of any debt or
(B) any services rendered or compensation which may be lawfully
received by any debt collector for the collection of a debt.
(3) The false representation or implication that any individual is an
attorney or that any communication is from an attorney.
(4) The representation or implication that nonpayment of any debt will
result in the arrest or imprisonment of any person or the seizure,
garnishment, attachment, or sale of any property or wages of any person unless such action is lawful and the debt
collector or creditor intends to take such action.
(5) The threat to take any action that cannot legally be taken or that
is not intended to be taken.
(6) The false representation or implication that a sale, referral, or
other transfer of any interest in a debt shall cause the consumer to
(A) lose any claim or defense to payment of the debt or
(B) become subject to any practice prohibited by this subchapter.
(7) The false representation or implication that the consumer committed any crime or other conduct in order to
disgrace the consumer.
jg: its been my understanding that a threat of criminal prosecution (period) is taboo.
(8) Communicating or threatening to communicate to any person credit
information which is known or which should be known to be false, including the failure to communicate that a disputed
debt is disputed
(9) The use or distribution of any written communication which
simulates or is falsely represented to be a document authorized, issued, or approved by any court, official, or agency
of the United States or any State, or which creates a false impression as to its source, authorization, or approval.
jg: in my opinion the latter part of this includes false / bogus assgt where the assignor has nothing to assign, where
the assgt is done for the sole purpose of satisfying an antecedent debt and doesnt convey the right to payment (iffy

on this, just thinking), where the assgt is done for the sole purpose of invoking jurisdiction by an assignee who (still)
isnt the real party in interest, wont suffer by the loss of non-payment, the recordation of an assgt where the assignee
has not accepted the assignment.
(10) The use of any false representation or deceptive means to collect
or attempt to collect any debt or to obtain information concerning a
consumer.
jg: ditto my last comment
(11) The failure to disclose in the initial written communication with
the consumer and, in addition, if the initial communication with the
consumer is oral, in that initial oral communication, that the debt
collector is attempting to collect a debt and that any information
obtained will be used for that purpose, and the failure to disclose in
subsequent communications that the communication is from a debt collector, except that this paragraph shall not
apply to a formal pleading made in connection with a legal action.
jg: this requires discussion imo
(12) The false representation or implication that accounts have been
turned over to innocent purchasers for value.
jg: ahem, ahem, ahem
(13) The false representation or implication that documents are legal
process.
(14) The use of any business, company, or organization name other than the true name of the debt collectors
business, company, or organization.
jg: same as my last comment
(15) The false representation or implication that documents are not
legal process forms or do not require action by the consumer.
(16) The false representation or implication that a debt collector
operates or is employed by a consumer reporting agency as defined by section 1681a(f) of this title.
( Pub.L. 90321,title VIII, Sec. 807, as added Pub.L. 95109,
Sept. 20, 1977, 91 Stat. 877 amended Pub.L. 104208,
div. A, title II, Sec.2305(a), Sept. 30, 1996, 110 Stat. 3009425.
jg: Check for amendments -sure thereve been some and not sure this is the most current version. This article, for
instance, discusses a 2013 proposal to grant attorneys a safe harbor. Bah.
http://www.friedmaniverson.com/consumer/blog/debt-collection/proposed-fdcpa-amendment-could-rollbackconsumers-rights/

5.
Deborah wynn, on August 14, 2015 at 9:59 pm said:

I have always wondered who do they submit their bill to, who pays them for what they do to us, like where does that
money actually come from i would be willing to bet

6.
Deborah wynn, on August 14, 2015 at 9:54 pm said:

Right JG unless they have been indemnified by some unknown God.

7.
johngault, on August 14, 2015 at 9:49 pm said:

Is your bankster a debt collector subject to the FDCPA?

.Read together and as confirmed in the Acts legislative history, Congress intent is clear, the exemption is intended
to include mortgage service companies and others who service outstanding debts for others, SO LONG AS debts
were NOT in default when taken for servicing.[This scenario is often the case when an assignment is made from one
servicer to another. Thus, for FDCPA purposes, the distinction between a loan servicer and a debt collector when it
was obtained.
V. The Foreclosure Mills
While the loan servicer may not be subject to FDCPA liability, their attorneys are.
http://nahoumlaw.com/when-is-a-residential-mortgage-loan-servicer-a-debt-collector-under-federal-collection-laws-itdepends-on-when-the-loan-went-into-default/

8.
Deborah wynn, on August 14, 2015 at 9:40 pm said:

https://en.m.wikipedia.org/wiki/Bucket_shop

9.
Deborah wynn, on August 14, 2015 at 9:36 pm said:

FYI
https://en.m.wikipedia.org/wiki/Doing_business_as
The phrase doing business as (abbreviated DBA, dba, d.b.a. or d/b/a) is a legal term used in the United States and
Canada, meaning that the trade name or fictitious business name, under which the business or operation is
conducted and presented to the world, is not the legal name of the legal person(s)

10.
Deborah wynn, on August 14, 2015 at 9:31 pm said:

Strikes me in my experience that the foreclosure mill bucket shop lawyers are rogue and yes Im being much too
polite I know ( but all deliberate part of the plan the one I have in mind worked for MERS prior) with BK of the outfit
also part of the plan typically doing business as

11.

louise, on August 14, 2015 at 7:55 pm said:

Yes just another example of the fact that they (the servicers) just sell them willy nilly to either get rid of a problem or
make some more money. I am seeing that the foreclosure mill lawfirms are declaring bankruptcy and not going out of
business (so that no one can go after the partners). I am reading that the servicers (scum that they are) are not
paying the lawfirms and what used to be a profitable business model is a dead end. The end is coming closer.

12.
Hammertime, on August 14, 2015 at 7:05 pm said:

Of course other signs of fraud. Besides consummation we have issue of fraud and damages on enforcement. So
good to keep in mind valid contract, reliable evidence, valid transaction.
Each and every variable in their definition is ripe for fraud.
Contract parties, meeting of minds, agreement, transaction etc.

13.
Hammertime, on August 14, 2015 at 7:00 pm said:

Thats interesting SC reminds me of partnership scenario Im familiar with. Hard to follow but IMO key would be what
do the closing documents say as any valid transaction. Any conflicts of who parties are and dates and what you, your
husband understand purpose and terms of loan. Putting aside tgere was no loan etc. What did you understand the
loan to be at closing. To me thats starting point then when you u did your good faith effort to obtain evidence or
court discovery is there broken chain from before fake transaction and/or after leading to pretender lenders, servicer,
trustee trying to steal ur property.

14.
Shadowcat, on August 14, 2015 at 6:39 pm said:

Hammertime.
I am a 3rd party to the contract and can only act for myself in that capacity.
The Note between my husband and the pretender llc on the note named as lender.
One of the missing deeds from closing was not blank and clearly
My husband and I granted a deed as joint tenets in common with ROS. to the funding company llc.
Another missing deed is the WD VIcky granted my husband and I.
Now..the Title is held by my Husband via a Trust Deed the lawyer had attached V Icky affirmation and signature to.
The trust deed is filed without. Trustee agreement.
The Note was not recorded.
No liens on title..just encumbered by a mortgage.
held in escrow until the loan is consummated and escrow closed.?

15.
hammertime, on August 14, 2015 at 6:19 pm said:

Can un do the loan = undo the contract

Cant undo signature, it happened which is where it becomes absurd that BANKS claim thats all there is to it.
Worse they took it and multiplied it on counterfeit notes and toxic mushroom cloud of derivatives.

16.
Shadowcat, on August 14, 2015 at 5:06 pm said:

Perfectly legal to take possession without notice of claims.

17.
Shadowcat, on August 14, 2015 at 5:00 pm said:

Lost Note..right?
Well nobody else is making claims to it your Honor.

18.
Shadowcat, on August 14, 2015 at 4:57 pm said:

Possession taken without notice of claims.

Put them on Notice.

19.
Shadowcat, on August 14, 2015 at 4:55 pm said:

Under the contract..has a maturity date and other terms that conflict with those of the borrowers note.
How much does KC owe?
Simple question Right?

20.
elexquisitor, on August 14, 2015 at 4:51 pm said:

Meanwhile, in the land of reality, my friend has the good fortune to inform the BK court that the lender who filed a
claim may have sold the loan after filing a proof of claim and before any discharge of BK. And no, the court was not
informed by the ersatz former lender of the change of possession. Penalty should have been assessed on change of
possession at least 1/2 the distance to the goal.

21.
Shadowcat, on August 14, 2015 at 4:50 pm said:

The Plaintiff
As One Half of the Estate.
The Plaintiffs Note ..

22.
Shadowcat, on August 14, 2015 at 4:41 pm said:

MERS had no authority to assign the Estates Mortgage.

23.
Shadowcat, on August 14, 2015 at 4:37 pm said:

Ohdid I say loanMy mistake..

THE ESTATES MORTGAGE

24.
Shadowcat, on August 14, 2015 at 4:35 pm said:

Its just crazy howif I wanted toorefinance and or modify the estates loan without the other..note payee
permission.
GRAY AREA
Many Blessings to All

25.
Shadowcat, on August 14, 2015 at 4:27 pm said:

My mistake Correction.
Your Honor I signed what Appeared to be a Mortgage.

26.
Shadowcat, on August 14, 2015 at 4:21 pm said:

LAW 101 When the Debt arises.

27.
Shadowcat, on August 14, 2015 at 4:05 pm said:

But I cant go back in time and undo my signature.

Sure you can if they misrepresented the contract to induce you into signing it.
Yes your Honor. I did sign what I thought was a mortgage.
But that is not what is was.

28.
Hammertime, on August 14, 2015 at 3:52 pm said:

That SC is where we go wrong w all this theory and going down rabbit holes. Keep it basic. When I signed on the
closing papers my understanding per the documents was there was a paid off loan and a new loan. THAT is what I
signed off on. I signed on with Chase tgat good bank Serena Williams is pushing not the Cayman Islands credit card
co, felon. That they used those documents to go into some system in the shadows is the deception and fraud. Has
nothing to do with my sophistication, type of loan, color where I live.
But I cant go back in time and undo my Sig is the issue? Nope. THEY have to UNDO THEIR FAKE LOAN AND
FRAUD OR BE CHARGED AS THE CRIMINALS THEY ARE.
We need to quit asking for the bankster and lawyers permission giving them authority over us.

29.
Shadowcat, on August 14, 2015 at 3:19 pm said:

Yes Hammertime. Your signature Reaffirmed a (non existent debt).

Modifying Fraud.
I mean really How do you get a choice of what contract to enforce should you default again.
Hogwash! Sign Nuttin!
Stale is Stale
Failure to State a Claim for which relief can be granted.
Lack of Prosecution .. SOS. .Shit On Shingle.

30.

Hammertime, on August 14, 2015 at 3:13 pm said:

The banks and lawyers are making this into another whos on first joke!

31.
Hammertime, on August 14, 2015 at 3:10 pm said:

I think Neil is waffling if thats a word! When it comes to date, non judicial.
The Supreme Court found language is unambiguous. The way to look at imo is there are exceptions including fraud
and loan never consummated although there were documents created to mislead us, predatory lending.
The purpose of law was to protect consumers and stop fraud.
Its the lenders and the politicians that have twisted the words and law ignoring the purpose.
So if you have reason and proof of fraud etc how could referring to false paperwork, dates mean you are confirming
the debt, loan?
Its the same bs like Chase lawyer told me that my signature meant I confirmed everything was true!

32.
Shadowcat, on August 14, 2015 at 2:57 pm said:

Hammertime.this is where Neil and I differ on rescission.

RTC does not start until the loan is consummated. .
Without enforcing the contract how is that a remedy ?
You have to get them to take a position and hold them to it!

33.
Hammertime, on August 14, 2015 at 2:49 pm said:

Rescind first? Unsecured debt?

34.
louise, on August 14, 2015 at 2:19 pm said:

I think more bankruptcy actions are going to happen to get the house out of the bankruptcy and out of debt.

35.
Deadly Clear, on August 14, 2015 at 1:50 pm said:

Reblogged this on Deadly Clear.

36.
Shadowcat, on August 14, 2015 at 12:43 pm said:

YesYou should Neil!

YES you Should!
BK would serve them Right if he filed!!!
It is Not an Option for everyone so keep in mind..
Proof of Claim is also Required at State Level