Third Circuit Interprets “Debt Collector” to Include Debt Buyer

Earlier this year, on February 22, 2019, a three-judge panel upheld a lower court ruling that debt-buying businesses could be liable for violations under the Fair Debt Collections Practices Act (the “FDCPA”).   The FDCPA’s purpose is to protect consumers from deceptive or unfair debt collection practices and applies to “debt collectors,” which is defined as those engaged “in any business the principal purpose of which is the collection of any debts” and those “who regularly collect” debts “owed or due another.” 15 U.S.C. § 1692(a).  The underlying case involves Crown Asset Management, LLC (“Crown Asset”), which is a purchaser of charged-off consumer debt.  After purchasing an account, if the consumer has not filed for bankruptcy, Crown Asset will refer the matter to a third-party service for collection or hires a debt collection law firm to file a lawsuit on its behalf.

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