This summer, the Consumer Financial Protection Bureau (CFPB) took a significant step toward reforming the regulatory framework for the debt collection industry. The focus is fueled in part by the large number of consumer complaints the CFPB receives about the debt collection market — roughly 35% of total complaints. Here are highlights from the recent CFPB proposal:
- Data quality: Collectors would be required to substantiate claims that a consumer owes a debt in order to begin collection
- Communication frequency: Collectors would be limited to six emails, phone calls or mailings per week, including unanswered calls and voice mails
- Waiting period: Reporting a person’s debt would be prohibited unless the collector has communicated directly with the consumer first
The CFPB said its proposal will affect only third-party debt collectors; however, it may consider a separate set of proposals for first-party collectors.