A collection agency has been granted a motion to dismiss by a District Court judge in Illinois after it was sued for allegedly violating the Fair Debt Collection Practices Act by including language in a collection letter that was provided by the creditor.
A copy of the ruling in the case of Walston v. Nationwide Credit, Inc., can be accessed by clicking here.
The plaintiff had a past due debt on his American Express credit card that was placed with the defendant for collection. In a letter, the defendant said that American Express had “authorized it to offer him the ‘opportunity to regain Card Membership’ ” by offering the opportunity to apply for a subprime credit card if the unpaid balance was taken care of. The letter also included a number of scenarios where the application for the subprime card would not be approved, including “American Express determines that you do not have the financial capacity to make the minimum payment on this new Optima Card account.”
The plaintiff filed suit, alleging the letter violated Sections 1692d, 1692e, and 1692f of the FDCPA because the offer to apply for the subprime credit card was “illusory.” The plaintiff argued the offer was “illusory” because “American Express retained the discretion to decide whether any particular debtor had the financial capacity to make minimum payments on the Optima Card and thus whether to grant the debtor’s application.”
The judge determined that “a reasonable consumer” would not be misled by the offer for a subprime credit card that was mentioned in the letter “which conveys in plain English that his application would be granted ‘unless’ American Express determined that he could not afford the minimum payment.”