IC System Unclear Settlement Offer in Collection Letter FDCPA Class Action

Congress passed the Fair Debt Collection Practices Act (FDCPA) because of the “abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors.” The complaint for this class action alleges that I.C. System, Inc. (ICS) violates that law in sending letters to consumer debtors which did not make clear the terms of its seeming offers to settle the debt.

The class for this action is

• All individuals with addresses in Florida
• To whom ICS sent a collection letter trying to collect a consumer debt
• Containing deceptively-worded offers,
• Where the letter was sent between December 20, 2020 and January 10, 2022.

In the case at issue, plaintiff Chaquita Johnson allegedly incurred a debt to Sprint, for personal, family, or household purposes, for telecommunications services.

At some point, ICS was assigned by Sprint to collect the alleged debt.

On or around June 10, 2020, ICS sent Johnson a collection letter. Among other things, the letter said the balance of the alleged debt was $2,119.60.

However, the letter appeared to contain something like a settlement offer. The complaint quotes it as saying, “If you would like to settle your account for $1,059.80 call I.C. System at 833-250-2055. If your account is settled for less than the full original balance it will cause future collection efforts to cease.”

The complaint alleges that the letter is “deceptive” because it appears to offer some form of settlement, “when in actuality it is unclear what form of settlement the letter is offering.”

The complaint claims, “The letter states that Sprint will recall the account and cease all collection activity but does not clarify what will occur with the rest of the balance and whether the rest of the balance would be collected by another collection company in the future.” The letter also does not say whether Johnson’s account will be instated if she pays the settlement amount.

Under the FDCPA, debt collection letters are supposed to be clear and not deceptive or misleading. The complaint asserts, “Pursuant to 15 U.S.C. §1692e, a debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.”

According to the complaint, the settlement offer “deceives and misleads” by implying that a settlement is being offered for $1,059.80 “when in reality [ICS’s] offer contains no significant benefits and is unclear [as] to what the benefits of the settlement would be.” It even alleges that the violations of the FDCPA are “knowing, willful, negligent, and/or intentional.”

Article Type: Lawsuit
Topic: Loans
Tags: FDCPA, Misleading or Confusing Debt Collection Letter, Unlawful Debt Collection