A collection agency has had its petition to set aside a civil investigative demand from the Bureau of Consumer Financial Protection denied related to potential violations of the Fair Debt Collection Practices Act and the Consumer Financial Protection Act.
Firstsource Advantage had petitioned the BCFP to set aside the CID because it is “rooted in erroneous factual and legal understandings as they pertain to Firstsource, the Dodd-Frank Act, and the FDCPA,” and whatever violations are being put forth by the BCFP are covered under the FDCPA’s bona fide error rule. The BCFP disagreed.
“Firstsource’s arguments here are misplaced, as they do not relate to the scope of the Bureau’s authority to issue CIDs,” the agency wrote in its order, which was signed by acting director Mick Mulvaney. “Instead, these arguments prematurely assert substantive defenses to claims the Bureau has not yet asserted and may choose not to assert.”
A CID is an information-gathering tool used by government agencies to compel the production of documents and information in order to determine if there are enough grounds for initiating an enforcement action.
The BCFP also denied a request from Firstsource to treat all its materials as confidential, but did grant a request to have portions of the company’s petition redacted because that information could be deemed to be confidential.
A number of defenses raised by Firstsource in attempting to modify the CID were also struck down by the BCFP, because the defenses were not raised during the meet-and-confer process and it is now too late to make changes, the regulator said. Firstsource argued that the requests were “disproportionate” and that the CID should be modified.
Firstsource had requested to produce a statistical sampling of call recordings instead of “all recordings,” as demanded by the BCFP. As well, Firstsource said some of the recordings are time-barred, but neither issue was brought up early enough, the BCFP said, and are not able to be modified at this point.