CLLA UPDATE-CFPB and Debt Collection Proposal
Sharon Edmondson, Washington Legislative Team Member | February 02, 2015
The CFPB is attempting to craft the first new regulations under the 1977 Fair Debt Collection Practices Act (FDCPA) and expects to take the next step on closely watched debt collection rules by April 15. The CFPB put out an advanced notice of proposed rulemaking in November 2013 and, in response, received more than 23,000 comments.
The CFPB is also exploring whether FDCPA type restrictions and requirements should apply to banks and other first-party creditors collecting debts in their own names. The banking industry wants the CFPB to focus its initial rulemaking efforts on debt collection firms, which it sees as using aggressive collection tactics against consumers. The CFPB has also indicated plans to rein in aggressive communication tactics and quality of information standards. It is assessing the need for standardized documents or forms when debts are handed off from creditors to debt collectors, or sold to debt buyers.
Also, in early 2015 the CFPB will release a study that will shed light on whether the bureau intends to regulate arbitration clauses in financial products and services.