Customers must know if call monitored, court says

A business must notify its customers that telephone conversations with employees will be monitored, and can be penalized $5,000 per call for secret eavesdropping, a state appeals court ruled Monday.

California law "protects an individual's right to know who is listening to a telephone conversation," the Fourth District Court of Appeal in San Diego said in reinstating a class-action suit against a consumer finance company.

The company, CashCall, provided the standard tape-recorded message on most of its incoming calls from customers, advising them that the conversations "may be monitored or recorded for quality-control purposes." But plaintiffs in the lawsuit said there were no such messages on some incoming calls or on any outgoing debt-collection calls from employees to borrowers.

A San Diego judge dismissed the suit, saying state laws ban only undisclosed monitoring by an outsider and not by an employee of the same corporation. Eavesdropping requires a third person, Superior Court Judge William Nevitt reasoned, and a corporation and its employees are usually considered a single entity when someone sues them.

The appeals court disagreed.

"The violation of the privacy right is the same regardless of who employs the secret listener," said Justice Judith Haller in the 3-0 ruling.

CashCall also argued that customers would know that anything they said to an employee on the phone would be shared with supervisors. But Haller said the law protects Californians from having their conversations "secretly overheard," regardless of whether the information is passed along later.

Joshua Swigart, a lawyer for more than 500 CashCall customers, said they may disclose personal information to finance companies and collectors - such as a medical condition that has made it harder to pay a bill on time - and should at least be on notice that someone else is listening.

He said the ruling should encourage companies to tell employees who call customers that the conversations may be monitored.

CashCall's lawyer was unavailable for comment. The company could appeal to the state Supreme Court.

The ruling can be viewed at sfg.ly/tzcFYm.

E-mail Bob Egelko at This e-mail address is being protected from spambots. You need JavaScript enabled to view it.

This article appeared on page D - 3 of the San Francisco Chronicle

You can do a lot with a quarter million dollars.

A woman, our client, owed a debt of less than $10,000. A debt collector telephoned her demanding payment. Because she was currently attending college and was only working part time, she made payment arrangements.

She paid as requested monthly payments for about six months, but suddenly the debt collector demanded more every month than previously agreed. When the woman explained that she could not afford any more, the debt collector told her the money previously paid would not be credited to her account and that she had to start paying over again. Further, the debt collector told the woman that if she did not pay the money demanded he would see to it the woman was branded as a unreliable and irresponsible, and that the woman would never find a job. He suggested the woman engage in prostitution to pay off the debt.

The case was litigated by our office, and the defendants eventually agreed to pay over $280,000 to the plaintiff.

Over $100,000 from an abusive debt collector.

A California consumer owed a debt. In an effort to collect on the debt, the debt collector tricked the consumer's cellular telephone provider to give the debt collector the password to the consumer's cellular web account. The debt collector was able to access the names and telephone numbers of the consumers friends, family, and business associates - people the consumer called or who called the consumer. The debt collector then began to call the consumers friends, family, and business associates, and claimed the debt collector was "investigating" the consumer because the consumer refused to pay debts owed. We were able to recover for the consumer in an amount over $100,000.

An innocent enough looking letter.

A California consumer fell behind on his homeowner's association payment. The debt collector for the homeowner's association sent the consumer a letter. One letter. The letter violated the FDCPA because it asked for fees that the debt collector was not allowed to collect. The consumer never actually payed the fees, but the demand was made. Our office recovered over $25,000.

Subcategories

RokNewsFlash

Customers must know if call monitored, court says

You can do a lot with a quarter million dollars.

Over $100,000 from an abusive debt collector.

An innocent enough looking letter.

Subcategories

The Attorneys