New CFPB Debt Collection Rule Will Help All Concerned

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The Consumer Financial Protection Bureau (CFPB) today put out its long-anticipated rule overhauling federal regulations on debt collectors. CEI financial policy experts praised the bureau for making rules more modern and fair for all concerned but also flagged a policy area in need of future fixing.

Statement by Matthew Adams, CEI policy analyst:

“The CFPB’s final debt collection rule helps modernize implementation of the Fair Debt Collection Practices Act (FDCPA), which was passed in 1977, such as by accommodating email and text communications.

“The new rule will help consumers by clarifying the law’s restrictions on harassing, oppressive, or abusive conduct by debt collectors. The rule will also give fairer treatment to legitimate debt collectors by extending safe harbor to those who abide by restrictions on the number of consumer contacts they may make each week.

“Ultimately, the rule will make sure consumers are protected from fraud and harassment and ensure that debt collectors are able to do their jobs in facilitating the flow of credit.”

Statement by John Berlau, CEI senior fellow:

“We continue to urge the CFPB to use caution in restricting the collection of time-barred debt, a matter which is still awaiting further rulemaking. While debt collectors should not be allowed to knowingly make false statements about whether a debt is valid, they should not be forced to keep track of different state statutes of limitations for borrowers’ obligations. Statutes of limitations are not designed as a loophole for borrowers to avoid paying their bills but to prevent fraudulent litigation and deterioration of evidence. The duty to ascertain precise legal obligations should be the responsibility of the consumer.”


Commentary: Protect Consumers, But Let Debt Collectors Do Their Jobs

CEI Comments Before the Bureau of Consumer Financial Protection on Proposed Rule on Debt Collection Practices