President Carter yesterday signed into law a bill prohibiting debt collectors from harassing or abusing consumers while collecting debts.
The bill makes it a federal offense for debt collectors to threaten consumers with violence, use obscene language, or contact consumers by phone at inconvenient times or places. Between 8 a.m. and 9 p.m. is considered convenient.
"It is not a minor matter to treat consumers fairly in this country." Carter said in signing the Fair Debt Collection Practices Act at a ceremony in the Rose Garden.
Noting that the measure was "the first consumer bill" he has had an opportunity to sign, Carter said he hoped it would be "the first of a series . . ." He specifically put in plugs for legislation to expand the availability of class action suits to consumers in federal courts, and for a bogged-down measure to create a federal Consumer Protection Agency.
In signing the measure, Carter noted that nearly 5,000 agencies collect about $5 billion a year in past-due bills. While most of the agencies are "honest and law-abiding," the practices of some "need to be corrected," he said.
The measure - whose primary sponsors were Rep. Frank Annunzio (D-Ill.) and Sen. Donald W. Riegle, Jr. (D-Mich.) - prohibits debt collectors from publishing "shame" lists, impersonating government officials or attorneys, obtaining information under false pretenses, and collecting more than is legally owed.
Debt collectors who violate provisions of the bill will be liable for any actual damages as well as any additional civil damages assessed by the court, up to $1,000, or, in the case of a class action, $500,000 or 1 per cent of net worth.