The undersigned consumer and civil rights organizations appreciate the opportunity to submit comments on the Consumer Financial Protection Bureau’s (CFPB or Bureau) proposed rule on debt collection. As organizations dedicated to eliminating abusive financial practices – particularly focused on communities of color and low- to moderate-income consumers – we are deeply concerned about the proposed rule’s content and impact. Without significant changes, we believe the rule will perpetuate abusive practices, harm already struggling families, and widen the racial wealth gap.
We urge the Bureau to:
- Ban the collection of time-barred debt in and out of court;
- Eliminate any “safe harbor” for collection attorneys who make false, deceptive or misleading representations; and require debt collection attorneys to review original account-level documentation that establishes the amount owed and allows the attorney to make an independent conclusion that they are suing the right person, for the right amount of money, and that their client has the legal right to sue;
- Require that debt collectors provide a Spanish translation on the reverse of every validation notice and provide translated versions of the validation notice to the consumer in a language the consumer can understand if certain circumstances are met;
- Require that debt collectors provide a “Statement of Rights,” as the Bureau proposed in Small Business Review Panel Outline, and require collectors to provide a Spanish translation of the Statement of Rights. And, provide translated versions of the validation notice to the consumer in a language the consumer can understand if certain circumstances are met;
- Limit the number of times a debt collector may attempt to call a consumer to three attempts per week per consumer;
- Require debt collectors to obtain consumer consent before contacting consumers via electronic communication methods, including email, text messaging, and private social media messages;
- Allow consumers to opt-out of electronic communication via any method convenient to them;
- Eliminate the proposal to allow “limited content messages,” and prohibit their exemption from being considered “communication” under the Fair Debt Collection Practices Act (FDCPA); and
- Improve the model validation notice to eliminate the option to make a payment and require that debt collectors provide a method to dispute a debt electronically in addition to providing the “tear off” option.
In addition, we urge the Bureau to retain these portions of the proposed rule:
- Limit debt collectors to one conversation per week, though the limit should be per consumer, not per debt;
- Clarify that consumers have the right to request that a debt collector stop calling or using another form of communication without stopping all communications;
- Prohibit the sale, transfer, or placement of certain debts, including debts discharged in bankruptcy, already paid, or subject of an identity theft report. And, we urge the Bureau to prohibit the sale of time-barred debts;
- Prohibit the “parking” of debts on credit reports by prohibiting a debt collector from furnishing information to a credit reporting agency about a debt before communicating with a consumer about the debt; and
- Prohibit the use of public social media platforms to communicate with consumers.
Center for Responsible Lending
Leadership Conference on Civil and Human Rights
National Fair Housing Alliance
National Coalition for Asian Pacific American Community Development (National CAPACD)
National Urban League