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UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C.
20580
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Division of Credit Practices
Bureau of Consumer
Protection
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September 13, 1996
Anne P. Fortney, Esq.
Carlsmith, Ball, Wichman, Case and Ichiki
700 14th Street, N.W.
Washington, D.C. 20005-2122
Dear Ms. Fortney:
This is in reply to your letter of July 22, 1996, concerning
whether the servicer of a "private label" credit card
or the merchant at whose stores the credit card is accepted is
a "debt collector" under the Fair Debt Collection Practices
Act (FDCPA). I incorporate by reference the facts set forth in
your letter in this reply.
My opinion remains unchanged from that given to you in our recent
telephone conversation. Based on the information in your letter,
I believe that:
- 1) the merchant is not a "debt collector" under
the FDCPA because the merchant does not engage in the collection
of debts for another and the principal purpose of its business
is not debt collection as required by Section 803(6),
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- 2) the servicer, while it engages in the collection of debts,
does so only with respect to debts not in default at the time
they were obtained. Thus, the servicer is exempt from coverage
of the FDCPA by virtue of the language of Section 803(6)(F)(iii).
Please be advised that this is the opinion of the Commission
staff and is not binding upon the Commission itself.
Sincerely,
John F. Lefevre
Attorney
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