Here are some reactions to the Consumer Financial Protection Bureau’s debt collection rule from lawmakers and consumer advocates
“As working families struggle to pay for food, housing, and other necessities, debt collectors are flooding the courts with collection lawsuits and reporting record profits. The CFPB’s new debt collection rule fails to provide hardworking consumers with the protections they need to guard against abusive debt collection practices. While I am pleased that the CFPB did not include some of the most harmful provisions of the proposed rule, the final rule still allows collectors to make excessive phone calls to consumers — up to seven times a week for each debt — and unfairly puts the burden on consumers to ‘opt out’ of harassing text, email, and social media messages. As the CFPB works to finalize a second debt collection rule, it must stand squarely with consumers by banning attempts to collect debt that is no longer legally collectable.”
Sen. Sherrod Brown [D-Ohio], Ranking Member, Senate Banking Committee
“This will provide clear rules of the road for small businesses and consumers. The CFPB is preserving important protections from harassment, while modernizing the way debt collectors can communicate. This will make it easier to identify, address, or dispute debts through 21st century communication channels that work best for both the consumer and the business. I applaud the CFPB’s work to finalize this rule.”
Rep. Patrick McHenry [R-N.C.], Ranking Member, House Financial Services Committee
“Debt collectors are notorious for hounding consumers and filing lawsuits about debts that have already been paid off or were never owed in the first place. The CFPB’s new rule does nothing about this egregious practice, and fails to ensure that debt collectors can prove that money is actually owed and they have the legal right to pursue the debt.”
Suzanne Martindale, Consumer Reports
“We appreciate that the CFPB has modified many aspects of the rule in response to our concerns, but with millions of Americans scraping by amid the economic fallout from a global pandemic, the rule still allows debt collectors to make excessive, harassing calls. The last thing struggling families need right now is to be harassed by a debt collector.”
April Kuehnhoff, Attorney, National Consumer Law Center
“We applaud the CFPB for dropping the safe harbor that would have widened the door for collectors to use state courts to sue consumers on wrong or incomplete information. But, the CFPB’s final rule does not do enough to protect communities of color, especially during COVID-19, who are still struggling to recover from the Great Recession because of discriminatory exclusion from the financial mainstream and predatory inclusion into high-cost loan products.”
Kiran Sidhu, Policy Counsel, Center for Responsible Lending
“Vulnerable consumers are facing unprecedented financial challenges in the wake of the pandemic. Although the CFPB dropped or delayed some of the most harmful parts of the proposed rule, it has fallen short to protect consumers, especially consumers of color who have a drastically larger share of debt in collections than white communities, from harassing calls and electronic communication.”
Rachel Gittleman, Financial Services Outreach Manager, Consumer Federation of America
“The devil is in the details, and we will have to scour this complicated rule to make sure that it does not open up new fronts for debt collectors’ pervasive and abusive treatment of consumers. Through the guise of modernization, the debt collection rule could open the gate for collectors to aggravate vulnerable consumers with even more harassment and a flood of electronic communications.”
Christine Hines, Legislative Director, National Association of Consumer Advocates
“Millions of Americans are out of work and taking on crushing levels of debt no thanks to the recession that followed President Trump’s refusal to take the pandemic seriously. And now the Trump administration is adding insult to injury letting debt collectors endlessly harass struggling families who are choosing between food and paying bills. On the heels of the Trump CFPB’s rule that let predatory payday lenders trap more vulnerable Americans in cycles of debt during a recession, the Trump debt collection spam rule is the administration’s latest gift to wealthy donors at the expense of consumers.”
Jeremy Funk, Spokesman, Allied Progress
“As we face a dire and worsening economic crisis, we will be keeping a close eye on the ‘zombie debt’ rule, coming in December, which could leave consumers more vulnerable to deception and harassment. Collectors should not be allowed to bring expired debt back to life by luring people into making a small payment that revives a debt that would otherwise be past the timeline for a lawsuit.”
Linda Jun, Senior Policy Counsel, Americans for Financial Reform Education Fund