Texas House Bill HB1572

Texas 2009 - 81st Regular

Caption

Relating to the imposition of statutory damages against a debt collector or third-party debt collector for improper debt collection activities.

Impact

If enacted, HB1572 would significantly modify the legal landscape governing debt collection activities in Texas. The introduction of statutory damages establishes a more punitive measure for debt collectors who violate consumer rights under the state’s finance laws. This shift not only raises the stakes for collectors but also aligns with broader efforts to enforce consumer protections, potentially leading to fewer violations as collectors may act with greater caution to avoid financial repercussions.

Summary

House Bill 1572 aims to enhance consumer protection against improper debt collection practices by enabling statutory damages against debt collectors and third-party debt collectors. The proposed legislation amends the Texas Finance Code, specifically Section 392.403, allowing individuals to sue for statutory damages in addition to actual damages incurred due to violations of the law. The bill specifies that debt collectors found to be in violation will be liable for a minimum of $100 per violation, thereby providing consumers with a clearer pathway to seek redress.

Contention

Notable points of contention surrounding HB1572 may involve concerns from debt collectors regarding the increased liability and the potential for litigation abuse from consumers. Advocates for consumer rights argue that the bill is a necessary step to deter predatory practices in the debt collection industry, while critics may express fears that it could lead to a flood of frivolous lawsuits, complicating the already challenging landscape for debt collection agencies. Depending on further legislative discussions and refinements, these debates are likely to shape the final form and implementation of the bill.