When we close an account due to overdraft, we mail notices to the customer of the amount owed and that the account should be brought to a positive balance to avoid any collection proceedings. However, we will then turn the charged-off account to a collection agency, do we have to notify the customer of this action?
The bank does not have to notify the customer that the charged-off account has been turned over to a collection agency. The collection agency will contact the customer requesting a verification of the debt and inform them they are handling the collection efforts of the debt from the charged-off checking account.
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