Owing money does not mean giving up your rights. Federal and California law control how consumer debts may be collected: when a collector may call, what it may say, and what it must tell you.
Violations are common, and they matter for two reasons. They can support a claim for damages and attorney fees, and if the same collector has sued you, they can change the balance of the case. This article explains the rules in the order they usually come up.
Signs Worth a Closer Look
- Calls that come many times a day, early in the morning, or late at night
- Threats of arrest, or of a lawsuit on a very old debt
- A balance that has grown with fees you never agreed to
- Calls to your workplace, your family, or your neighbors
- Continued calls after you disputed the debt in writing or hired an attorney
Who Is Covered
Identifying which laws apply to the company contacting you.
The federal law
The federal Fair Debt Collection Practices Act applies to third-party debt collectors: collection agencies, debt buyers, and law firms that regularly collect consumer debts. It generally does not apply to an original creditor collecting its own accounts.
California’s Rosenthal Act
California’s Rosenthal Fair Debt Collection Practices Act reaches further. It covers original creditors collecting their own consumer debts as well as third-party collectors, and it adopts most of the federal rules. A bank or card issuer that falls outside the federal law can still be covered under California’s. Attorneys are excluded from the California definition, but collection law firms remain subject to the federal law.
Licensing
Since 2022, California’s Debt Collection Licensing Act has required most debt collectors and debt buyers that collect from California residents to be licensed by the Department of Financial Protection and Innovation. A collector’s license status can be checked online.
Consumer debts only
These laws protect individuals on debts for personal, family, or household purposes. Business debts are generally outside them.
Prohibited Conduct
Recognizing the conduct that crosses the line.
How and when they contact you
- Calling before 8 a.m. or after 9 p.m. your local time, unless you agree.
- Calling repeatedly to annoy or harass. Federal rules treat more than seven calls within seven days about the same debt as presumptively excessive.
- Calling you at work after learning your employer does not allow it.
- Contacting you directly after learning that an attorney represents you on the debt.
- Discussing your debt with family, neighbors, or your employer, beyond limited contact to locate you.
What they say
- Threatening arrest, jail, or criminal charges.
- Threatening a lawsuit, garnishment, or seizure the collector cannot take or does not intend to take, including a lawsuit on a debt that is too old.
- Misstating the amount owed, or adding interest and fees the agreement or the law does not allow.
- Pretending to be an attorney, a government agency, or a credit bureau.
- Using obscene or abusive language.
After you object
A written request to stop contact requires a collector covered by the federal law to stop, except to confirm that it is ending collection or to tell you about a specific step, such as a lawsuit. A collector that keeps collecting after a timely written dispute, without first verifying the debt, may also be in violation.
A creditor or collector with a valid and timely claim is allowed to sue. The question is whether the lawsuit, or the conduct around it, was false, unfair, or otherwise prohibited.
Validation and Dispute
Making the collector show what it claims.
The validation notice
Within five days of first contacting you, a third-party collector must send a validation notice. It identifies the creditor, states the amount owed with an itemization of interest, fees, payments, and credits since a recent reference date, and explains your right to dispute.
The dispute window
You have about 30 days from receiving the notice to dispute the debt in writing. A timely written dispute requires the collector to stop collecting until it mails you verification of the debt, or the name and address of the original creditor if you ask for it.
How to dispute
Dispute in writing, keep a copy, and send it by a method that proves delivery. State that you dispute the debt and ask for verification. You do not need to explain why.
If you miss the window
Missing the 30 days does not mean you owe the debt, and it does not waive your defenses if you are sued. It only allows the collector to treat the debt as valid for its own purposes.
- The original creditor and the account number
- The balance at charge-off, and how the current balance was reached
- Who owns the debt now
- The date of default
Documenting
Building a record that will hold up later.
What to keep
- A call log: the date, time, number, the caller’s name, and what was said
- Every letter, with the envelope showing the postmark
- Voicemails, saved and backed up
- Screenshots of texts, emails, and social media messages
- Your credit reports, which show who is reporting the debt and how
California is an all-party consent state. Recording a confidential phone call without the consent of everyone on the call is against the law, and the recording may be unusable. Many collectors announce that their calls are recorded. Even so, the safer course is to say at the start of the call that you are recording, or to rely on careful notes instead.
Keep calls short
Do not argue on the phone or agree to anything there. Ask for everything in writing. Once you have an attorney, give the collector our contact information, and the calls to you should stop.
Remedies
What the law lets you recover, and how violations matter in a lawsuit.
Damages and fees
- Actual damages. Money lost and, in many cases, emotional distress caused by the conduct.
- Federal statutory damages. Up to $1,000 per case, without proof of actual loss.
- California penalty. An additional $100 to $1,000 for willful violations.
- Attorney fees and costs. A collector that violated either law must pay your reasonable attorney fees and costs when you prevail.
The deadline
Claims under both laws generally must be filed within one year of the violation. Keep the record as you go, and do not wait to act.
Leverage in a collection case
When the collector that broke the law is also suing you, the violation can be raised in a cross-complaint in the same case or used in negotiation. A plaintiff facing a claim for your attorney fees has a reason to settle. See our guides to being sued by a debt collector and settling a collection lawsuit.
Complaints to regulators
You can also file a complaint with the Consumer Financial Protection Bureau or with California’s Department of Financial Protection and Innovation. A complaint does not award damages, but it creates a record and often prompts a response.
Federal and California Law Side by Side
| Feature | Federal FDCPA | California Rosenthal Act |
|---|---|---|
| Who it covers | Collection agencies, debt buyers, collection law firms | Original creditors and third-party collectors; attorneys excluded |
| Statutory damages | Up to $1,000 per case | $100 to $1,000 for willful violations |
| Attorney fees | Paid by the collector if you prevail | Paid by the collector if you prevail |
| Deadline to sue | One year | One year |
What It Costs
Because both laws require a collector that violates them to pay the consumer’s reasonable attorney fees, the fee arrangement for a violation claim often differs from a typical matter. When violations come up within a collection lawsuit we are already defending, they are handled as part of that representation. We explain the options at the first meeting and set out the arrangement in a written agreement before work begins.
- Every letter from the collector, with envelopes
- Your call log, voicemails, and screenshots of texts or emails
- Any dispute or cease letter you sent, and proof of delivery
- A recent credit report
- Lawsuit papers, if the collector has sued you
Gregory Grigoryants is a California attorney (State Bar No. 286804) who has represented individuals, families, and business owners in bankruptcy, debt collection defense, and tax resolution matters for more than 13 years. He practices from offices in Sherman Oaks and Beverly Hills and speaks English and Russian.