Yes, you do have rights!
Debtors are protected by the Fair Debt Collection Practices Act.
The Act was written to protect consumers from unfair debt collection practices used by debt collectors, i.e. collection agencies or other 3rd party debt collector.
NOTE: A state or Commonwealth may have its own statutes regarding debt collection which an attorney who specializes in debt collection disputes will take into consideration in litigation on your behalf in addition to the Federal statute. State and Commonwealth laws are sometimes broader than the FDCPA and may address the behavior of in-house collectors.
You can read the entire Act by clicking on the Federal Trade Commission web site: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre27.pdf.
It's a good idea to read the entire Act because it contains a lot of good information. Yes, it's in legalese and can be confusing, but you can understand it by breaking the sentences down into a few words at a time.
You will find an explanation of the Act at http://www.pennlawyer.com/fdcpa.htm, but keep in mind the site is only talking about collection agencies, not the creditor itself.
Expert Law (http://www.expertlaw.com/library/consumer/fair_debt_collection.html) has one of the best explanations on the web.
Just because the Act only addresses collections agencies does not mean that creditors who do their own collections can go hog wild and threaten you and members of your family with all sorts of consequences, real or imaginary.
If a bank or store owner goes over the top and slides into harassment, you can still file a complaint with the State Attorney General, the Better Business Bureau, and the Consumer Protection Services in the state where the creditor is located. If you have reason to complain about the collection practices of a creditor, there are certain conditions you should have in place before you call that will help your complaint.
Please continue reading.
If you passed a counterfeit draft or received stolen funds wired into an account, the creditor does have the right to press charges. That's not an idle threat; however, the objective is to forestall any such action by your creditor.
To keep yourself on the right side of the line, file a police report about how you obtained the fraudulent draft or stolen wired money, provide a copy of the report to the creditor, and be the one who is aggressively pursuing setting up a repayment plan with the creditor - doing so in front of witnesses. Please refer to the Scam Solution Center Menu for step-by-step guidance
Witnesses are very important and you should have one at your side, listening on the phone or with you at the creditor's place of business every single time you press for a repayment plan.
We even advise that you go ahead and send the creditor a payment of whatever you can afford, again with a witness to the act. Buy a money order to do this so that there is an independent record of your purchase. If the creditor cashes the money order (you can contact the money order company to see if the draft has been cashed) then you have doubly given evidence that you are pulling out all the stops to make good on the debt.
If the creditor absolutely refuses to work with you and takes you to civil court or tries to press charges, both by witness and document, you have evidence that you have been doing your level best to make amends.
In civil court, this means you can request a court-appointed arbitrator to review you financial situation (remember the budget we asked you to complete?) and make a decision about what you can actually afford to pay the creditor vs. what the creditor is demanding.
If the creditor presses criminal charges because you haven't paid the entire amount, once again you have your witnesses and documents that demonstrate you have done everything possible to rectify the situation. Your responsible behavior minimizes grounds for arrest and in many jurisdictions law enforcement will tell the creditor that it's a civil matter.
Back to contacting the agencies listed above to complain about harassment - if you have been following the steps we've just described your complaint will hold more water than if you've done nothing at all.
You can attest to the fact that the creditor has no reason for harassment because in fact, you have been on the creditor's back to work out a solution.
Credit unions are famous for demanding all the money all at once, and very few fraud victims can comply with the demand.
We urge you to follow the steps we've just taken you through. Credit unions generally send the debt to a collection agency, which is where you have room for negotiation.
There do exist situations in which the bank or credit union has stepped out of bounds, but that cannot be determined unless we see can look at your budget and read your narrative.