The Government Accountability Office has issued a report analyzing the Consumer Financial Protection Bureau’s compliance with procedural steps related to its release of the debt collection rule, which the GAO is required to perform and provide to both houses of Congress.
A copy of the report can be accessed by clicking here.
The primary assessment conducted by the GAO was a cost-benefit analysis of the debt collection rule, seeking to determine whether it will be more costly or less costly for debt collectors to recover unpaid amounts and whether the rule will increase or decrease the supply of credit. The CFPB said “it is not clear” which of those options will occur, but that it “will benefit both consumers and debt collectors by increasing clarity and certainty about what [Fair Debt Collection Practices Act] prohibits and requires.”
Acknowledging that the rule is going to change how collectors communicate with consumers, the provisions of the rule are “likely to interact with each other in ways that make their net impact difficult for the Bureau to predict,” according to the report. One likely outcome of the rule will be a reduction in the overall number of calls placed to consumers by collectors, from which consumers will benefit, according to the report. That being said, though, “the Bureau stated it cannot predict the net effect of these provisions on debt collectors’ costs and revenues or the net change in indirect costs to consumers if debt collectors cannot reach them from, for example, litigation.”
The GAO’s report — which was issued in early January — was submitted to Sen. Mike Crapo [R-Idaho], the chairman of the Senate Banking Committee, and Sen. Sherrod Brown [D-Ohio], the committee’s ranking member, as well as Rep. Maxine Waters [D-Calif.], the chairwoman of the House Financial Services Committee, and Rep. Patrick McHenry [R-N.C.], the committee’s ranking member.