Two of the most comprehensive, meaning longest, comments about the Consumer Financial Protection Bureau’s proposed debt collection rule have been submitted, one from each side of the debate.[EDITOR’S NOTE: Have you listened to John Bedard’s section-by-section breakdown of the proposed rule? All episodes of this limited series podcast can be accessed by clicking here.] [Somewhat] in the industry’s corner was a 13-page comment that was submitted by CorTrust Bank. In the other corner was a 17-page comment that was submitted by Consumer Reports.
The comment period for the proposed rule is only one for one more week. So far, nearly 9,000 comments have been filed, many of them by consumers expressing their disappointment over what the CFPB has proposed.
In its comment, Consumer Reports offers a number of suggestions, including holding first-party and third-party collectors to the same standards. “Original creditors are the source of all key information about the debt that can be passed on to third-party debt collectors and debt buyers,” wrote Suzanne Martindale, a staff attorney with Consumers Union, the advocacy arm of Consumer Reports. “Their failure to keep accurate records can lead to improper in-house collection efforts – and their failure to pass on accurate and complete information about a debt can lead to improper collection attempts by subsequent third-party assignees and debt buyers.”
Martindale also suggests language that should be included on the front page of every validation notice, to ensure consumers know about their rights. The language she proposes is:
“You have the right, within 30 days after receiving this notice, to dispute that you owe all or any part of this debt. If you make this request, we won’t try to collect the debt again until we give you a response.
If at any time you want us to stop contacting you in writing or over the phone about this debt, you can ask us to stop contacting you. If you do that, we cannot call you or write you again, unless it’s about a lawsuit we’ve filed in court.”
In its comment, CorTrust goes section-by-section through the proposed rule, sharing its thoughts and opinions. Where it spends the most time, though, is on the proposed frequency limits on contacting individuals via phone calls.
The CFPB “may actually cause more harm than protection to the consumer,” the bank points out. “The intent of a majority of debt collectors is not to harass, oppress, and/or abuse, but to provide possible solutions to consumers. As such, the time period for a debt collector to contact a consumer is very important to minimize any possible damage to the consumer. A debt collector should be able to make an attempt to reach the consumer at a minimum twice per day.”
The bank also suggests that the frequency limit should not be based on attempting to call one number but attempting all valid numbers for a consumer. And rather than limiting the number of calls per week, the bank suggests that once a call is placed, the collector may not make another call attempt for four hours.