For close to 18 years, debt collectors and loan servicers subject to the Fair Debt Collection Practices Act (“FDCPA”) relied on the U.S. Court of Appeals for the Seventh Circuit’s June 5, 2000 decision in Miller v. McCalla, Raymer, Padrick, Cobb, Nichols, and Clark L.L.C. The court in Miller offered debt collectors a “safe harbor” method of explaining the amount a consumer owes to satisfy her debt. The Seventh Circuit’s recent decision in Boucher v. Fin. Sys. Of Green Bay, Inc. potentially threatens that “safe harbor.”
Section 1692g of the FDCPA requires a debt collector to send the debtor a “validation of debt” notice within five days after the initial communication with the consumer.1 This notice must include the amount of the debt, among other information.2 Simple enough. But what is a collector to do when the debt is continuing to accrue interest, fees, or charges on a daily basis? The Seventh Circuit appeared to resolve this problem in its 2000 Miller decision. In Miller, the court addressed a debt collector who notified the consumer of only his unpaid principal balance, while disclosing that the unpaid principal balance did not include accrued interest, fees, or other charges, without setting forth the amounts of those items.