Consumer Financial Protection Bureau Director Richard Cordray discussed CFPB enforcement efforts and the pending rules for the debt collection industry, which are expected to be issued this year, during the National Association of Attorneys General meeting held earlier this week.
The pending collection rules were first announced in November 2013. The CFPB has extended its deadline for comments from federal officials and others, including debt collection industry representatives. He said again this week that while there are legitimate debt collectors who play by the rules, there is a need for regulation to address harassing tactics. He said the bureau is seeking input from attorneys general and the Federal Trade Commission on possible regulatory changes.
Under the Dodd-Frank Act, the bureau became the first agency with authority to develop rules to implement the Fair Debt Collection Practices Act, he said. That statute was enacted in 1977 - the year I graduated high school. Much has changed in the years since, but the law in this area has not kept up. So right now, we are hard at work analyzing and preparing the details of proposed policy measures, which could lead to the most significant changes in federal law in this area in almost 40 years.
Very few policymakers can sit down and sketch a unified theory of the universe that actually fits the world around us, he said. Better insight comes from those doing the relevant work, who can speak from their own experience. I am glad to know that you will be guiding us, and advising us, as we carry out this overhaul of federal debt collection law. With your counsel, we will reach results that are better informed and more balanced.
Debt collectors have expected new rules since the CFPB began targeting a handful of debt-settlement firms through enforcement actions in early 2013. The bureau that year finalized a rule allowing it to supervise large nonbank debt collectors. CFPB officials haves vowed to listen to all parties before finalizing rules to make sure consumers are protected without overburdening the industry.