Last week , the Consumer Financial Protection Bureau (CFPB) met with the Community Bank Advisory Council (CBAC) to discuss the CFPB’s July 28, 2016, outline of the proposed debt collection rules (Outline) intended to “drastically overhaul the debt collection market.” The meeting was available online through the CFPB’s website.
The CBAC did not provide much substantive feedback concerning the rules during the meeting, as many of the CBAC members handle debt collection in house. Nonetheless, the CFPB’s presentation provided valuable insights into the rulemaking process and the CFPB’s current stance on the Outline.
At the meeting, the CFPB continued to emphasize that new debt collection rules are coming soon. Following the publication of the Outline, the CFPB met with the Small Business Regulatory Enforcement Fairness Act Process (SBREFA) Panel on August 25, 2016. The CFPB noted that it is required to issue a report on the SBREFA Panel within 60 days of the meeting. Once the report is issued, the next step in the rulemaking process will be the CFPB’s issuance of a Notice of Proposed Rulemaking (NPRM).
The CFPB highlighted that the specifics set forth in the Outline remain subject to change. Indeed, the CFPB indicated that it is still conducting research on the model disclosures provided in the proposal. Furthermore, the CFPB’s questions to the CBAC suggest the CFPB is still gathering information on the types of information first-party creditors provide debt collectors upon selling or transferring loans and the types of information the CBAC believes its consumers needed to know about their debts and the debt collection process.
While the specifics of the Outline may change, Director Richard Cordray’s remarks suggest the topics covered by the Outline are unlikely to change. Specifically, Director Cordray touched upon the CFPB’s goal of ensuring accuracy and accountability in every aspect of the debt collection lifecycle by issuing the first set of comprehensive regulations since the enactment of the Fair Debt Collection Practices Act (FDCPA) in 1977. Director Cordray further emphasized the CFPB’s focus on ensuring debt collectors have more reliable information on debts, limiting contact attempts, and making it easier for consumers to dispute debts.
Stay tuned to Bradley’s Financial Services Perspectives blog for a series of in-depth articles concerning the forthcoming debt collection rules and practical advice for navigating those rules.