New Debt Collection Regulations Under Consideration


. By Heidi Turner

Debt collector harassment is already illegal in the United States, but laws have not stopped bill collector harassment from occurring. Every day, more people complain about being harassed by people attempting to collect on bills, regardless of whether the debts claimed are actually owed. Debt collector lawsuits have been filed, alleging consumers have been unfairly or illegally targeted, and now the Consumer Financial Protection Bureau (CFPB) is asking for input on debt collection experiences.

Currently, federal laws protect consumers from certain debt collector practices. These practices include phoning outside of regular hours, making harassing phone calls, using threatening or obscene language when collecting on debts, continuing to make calls despite receiving a “cease communications” notice, and giving information to a third party without consent. Other issues with the debt collection industry include collecting on a non-existent debt, collecting on a debt from the wrong person and collecting on a debt that has already been paid.

Now, the CFPB is taking note about concerns with the industry, and is considering updating debt collection laws. Consumers who have had experiences with debt collection agencies are encouraged to share their story with the CFPB.

In a March 20, 2013 report entitled “Fair Debt Collection Practices Act,” the CFPB noted that approximately 15 percent of American adults had debt that was or had been subject to collections processes. In 1977, the Fair Debt Collection Practices Act was passed after Congress found evidence of “abusive, deceptive, and unfair debt collection practices by many debt collectors.” But since that law was passed in 1977, changes in the industry and technology have altered how debt collectors operate.

The report notes that the Federal Trade Commission (FTC) received a greater number of complaints about the debt collection industry than any other single industry. This included complaints about third-party debt collectors and in-house debt collectors. Although the number of complaints was down from 2011 to 2012, there are still concerns about how debt collectors operate.

For example, in 2012, the FTC received more than 37,000 complaints that accused debt collectors of calling repeatedly or continuously. That same year, there were more than 13,000 complaints that collectors used abusive, obscene or profane language.

Lawsuits have been filed by consumers and officials against some debt collection agencies, alleging the companies have broken the law in their debt collection practices.


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