On November 6, 2013, the Bureau of Consumer Financial Protection issued its Advanced Notice of Proposed Rulemaking (ANPR), Docket No. CFPB-2013-0033, indicating the Bureau is evaluating whether to issue regulations. The regulations, dubbed “Regulation F,” would be applicable to nearly all aspects of debt collection. 

In 2010, the Dodd-Frank Act authorized the Bureau to “prescribe rules with respect to the collection of debts by debt collectors, as defined in [the FDCPA].” 15 U.S.C. 1692l(d).Comments on the proposal are due within 90 days of the publication date in the Federal Register, or by February 10, 2014. See here

While the ANPR does indicate that "[t]he Bureau's objective would be to protect consumers, yet not impose undue or unnecessary burdens on the industry," ANPR, p. 21, every area the CFPB is evaluating has the potential to add significant costs on the collection industry. The ANPR contains 162 questions, plus numerous sub-parts, on topics ranging from the paper trail required to accompany debts placed for collection, added controls on the content, channels and frequency of communications, additional procedures required to respond to investigate and respond to disputes, recordkeeping and state debt collection litigation. 

The CFPB has clearly cast a wide net that will significantly add to the cost of debt collection.

We encourage you to review the ANPR and identify areas that you can address. For example, question 47 asks: "What would be the costs and benefits of requiring particular forms of information to verify a debt? Are there any particular types of verification that would be especially beneficial to consumers or particularly costly for collectors to provide?"

Consumers and consumer advocates are expected to provide anecdotal information to support their views that more information is required to verify debts. Adding up the costs associated with providing verification and various types of documentation and providing that statistical information to the CFPB is likely the only answer the industry can provide to sway the regulatory process away from adding multiple layers of additional work and cost.

We encourage all our clients and all friends to submit comments to the ANPR. If you are interested in submitting comments to the ANPR, we can help you. Give us a call.

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