UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580

August 19, 1992

Douglas M. Fisher
Solomon and Solomon, P.C.
Washington Square
Box 15019
Albany, New York 12212-5019

Dear Mr. Fisher:

This is in response to your request for a staff opinion regarding the Fair Debt Collection Practices Act ("FDCPA"). I apologize for the delay in responding.

The issue you raise may be summarized in the following manner. Your firm performs collection activities for creditors. A consumer indebted to the creditor dies and leaves no surviving spouse. Because the consumer had very few assets, the consumer's relatives choose not to probate the estate. They do, however, wish to pay off the deceased consumer's debt to your client. One of the relatives contacts your office and asks how much the consumer owes. The question on which you would like a staff opinion is whether your firm would violate the FDCPA if it revealed to the relative the amount of the debt so that the relative can pay it off.

Section 805(b) of the FDCPA provides:

Except [for attempts to locate the consumer], without the prior consent of the consumer given directly to the debt collector, or the express permission of a court of competent jurisdiction, or as reasonably necessary to effectuate a postjudgment judicial remedy, a debt collector may not communicate, in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.

Under the FDCPA, the term "communication" means "the conveying of information regarding a debt directly or indirectly to any person through any medium." For purposes of Section 805, the term "consumer" includes the consumer's spouse, parent (if the consumer is a minor), guardian, executor, or administrator.

Although the statutory definition of "consumer" does not specifically mention those relatives of a deceased consumer who voluntarily seek to repay the consumer's debts, it is the staff's opinion that, when the object of a contact is to repay, such relatives are sufficiently similar to executors or administrators to be included in the definition for that purpose. This is consistent with the Commission's policy of encouraging prompt repayment of debts and possesses none of the problems associated with the unauthorized disclosure of their existence. The restriction imposed by Section 805(b) on communicating with third parties is intended to prevent unscrupulous debt collectors from embarrassing consumers or tarnishing their reputations by revealing their debts to friends, neighbors, employers, and family members who do not already know of them. In the scenario described above, however, the family member already knows that a debt exists and is only seeking to discover the total amount owed in order to repay it. The potential harm at which Section 805(b) is aimed does not exist. We believe, therefore, that a third party communication of the nature you describe is permissible for purposes of repayment.

The views expressed herein represent an informal staff opinion. As such, they are not binding on the Commission. They do, however, reflect the staff's current enforcement position.

Sincerely,

Thomas E. Kane
Attorney
Division of Credit Practices