CFPB Releases Supervisory Highlights, Spotlight Issues Found During Examinations of Collection Operations

The Consumer Financial Protection Bureau has released the 24th issue of its “Supervisory Highlights” reports, which shares the results and findings from examinations of companies regulated by the CFPB with respect to how those companies are complying with federal law. This includes debt collectors and their compliance with the Fair Debt Collection Practices Act, which the CFPB “identified violations” of during its examinations.

Understanding the types of violations that the CFPB is seeing can help companies avoid making similar mistakes.

Among the violations that were identified by the CFPB during its exams held in 2020 were:

  • Collectors making calls to consumers at their workplaces after they knew or should have known that the employers prohibit such communications. The collectors found to have violated this provision of the FDCPA are improving their training and monitoring, according to the CFPB.
  • Debt collectors were also found to have communicated at times when they knew or should have known that calls during work hours were inconvenient for consumers. One collector called at a time when it had been previously told by the consumer that the time was inconvenient and another called after being informed that calls to the workplace were inconvenient. Again, the collector is improving its monitoring and training.
  • Collectors were found to have communicated with third parties in violation of the FDCPA. Some collectors spoke with individuals who had names similar to the consumer they were looking to reach and other collectors identified their employers during location information calls when it was not expressly requested by the third parties. Improvements to the collectors’ compliance management systems, as well as additional training and monitoring are being undertaken to keep that from happening again.
  • Collectors were found to continue attempting to collect debts after receiving model forms indicating that the consumer’s identity had been stolen and requesting that further communications be ceased.
  • Collectors were found to harass or oppress consumers who stated they were unable to make or complete payment arrangements by telling consumers that notes would be placed in their accounts that the consumer was refusing to make a payment.
  • Collectors were found to continue reporting debts to credit reporting agencies and not properly identifying debts as being disputed even though the collectors knew or should have known that the debts were disputed, resulted from identity theft, and were not owed by the relevant consumers.
  • “Several” debt collectors were found to have falsely represented to consumers the impact that paying off debts would have on their credit scores. According to the CFPB, “one debt collector told a consumer the debt would no longer ‘impact’ her credit profile once paid, which was false. Another debt collector told a consumer that making a payment would help to ‘fix’ the consumer’s credit.”

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