Law firm liable for failure to verify information provided by client in a debt collection matter
LiabilityLawyers can be subject to liability under the federal Fair Debt Collection Practices Act. In a recent case, a law firm relied on information provided by a client to pursue collection of about $11,000 allegedly due for insurance on a home that was mortgaged and had been foreclosed. In fact, however, the property owner had paid taxes and insurance directly. A federal court in New Jersey has ruled that the law firm is liable under the FDCPA.
With the downturn in oil and gas production in Texas, there will likely be an increase in collection activity on consumer debts. Lawyers new to such work should familiarize themselves with this area of law. An ABA article on potential lawyer liability under the FDCPA in 2010 provides more information.
