Assignment Problem: Dr. Geller suffered a mid-life crisis. He began to eat healthier and train for a triathlon. He also replaced his aging Porsche for a spicy red Ferrari. Still feeling unfulfilled, he left his career as a Professor of Paleontology to be a debt collector.
As a former academic and self-identified nerd, Dr. Geller studied the industry and reviewed the applicable laws. He theorized that if a debt-collection business collected only debts it owed as a result of buying checks written on accounts with insufficient funds (NSF checks), it wouldn't be subject to the federal Fair Debt Collection Practices Act. Wasting no time, he formed Ben-Emma Collections, Inc. and purchased over a million NSF checks, with an estimated face value of about $78 million, for pennies on the dollar.
The firm instructed its employees to add a fee of $130 to the face value of each check (exceeding the legal limit in most states) and aggressively pursue its drawer to collect. In communicating with drawers, the firm's employees were prohibited from using profanity, but allowed to use less offensive motivational terms like "bum" and "deadbeat," The firm's employees were told to warn drawers of arrest and prosecution. If still unsuccessful, the firm's employees could call the drawers' family members. Ultimately, with these business practices, Ben Emma Collections, Inc. netted over a $1 million during its first year of operation.
Is Ben-Emma Collections a "debt collector" collecting "debts" within the meaning of the FDCPA?