National Recovery Agency Facing FDCPA Class Action

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A proposed class action lawsuit says defendant National Recovery Agency engaged in debt collection practices that violate the terms of the Fair Debt Collection Practices Act (FDCPA). The plaintiff claims the defendant sent him a collection notice that “is open to one of multiple interpretations and would likely be misunderstood by an unsophisticated consumer,” i.e. the benchmark used by courts in cases arguing whether debt collectors’ methods are FDCPA compliant.

According to the 17-page lawsuit, the defendant failed to inform the plaintiff whether the stated balance owed in the notice may increase due to accrued interest and fees. A reasonable consumer, the case argues, could read the defendant’s communication and be misled into wrongly thinking he or she had paid the debt in full when it was automatically continuing to accrue undisclosed interest.