Almost all Americans pay their debts and most of those who don’t are facing circumstances beyond their control like unemployment, a medical calamity, and other usually tragic occurrences. Congress enacted the Fair Debt Collection Practices Act (FDCPA) to protect those vulnerable Americans from shocking, egregious, and abusive practices by the debt collection industry: calling homes repeatedly day and night; calling employers to get people fired; calling friends, neighbors, and relatives to embarrass people; and generally harassing people nonstop to boost their profits. The list of horror stories is long and revolting.
The Consumer Financial Protection Bureau (CFPB) has proposed a rule to implement the provisions of the FDCPA. While it has a few modest consumer protections in it, the proposal also opens too many loopholes and ambiguities that will enable debt collectors to once again engage in too many near-abusive or outright abusive practices. For example, as we detailed in our comment letter, the proposal allows too many communications with debtors, essentially amounting to legalized harassment, and it would create an escape hatch from liability when debt collectors file lawsuits to collect on debts that are actually time-barred under the law.
We will continue to fight to make sure the CFPB puts consumer interests over debt collectors and meaningfully constrain their impulse to engage in abusive but highly profitable practices.