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Consumer Reports urges CFPB to delay debt collection rule and strengthen protections for consumers

Nearly 180,000 consumers sign petition calling for debt collection rule to be rescinded 

WASHINGTON, D.C. – Consumer Reports is calling on the Consumer Financial Protection Bureau today to delay the implementation of a debt collection rule adopted by former director Kathy Kraninger and to strengthen protections to limit abusive collection practices. CR submitted comments to the CFPB on the rule along with a petition signed by nearly 180,000 consumers urging the Bureau to rescind it.

“The CFPB’s current rule fails to fix our broken debt collection system and makes consumers even more vulnerable to unfair harassment,” said Syed Ejaz, policy analyst for Consumer Reports.  “If this rule goes forward, debt collectors could hound consumers by text, emails, and on social media without having to confirm that any money is actually owed.”

Consumer Reports urged the CFPB to revise the rule by requiring debt collectors to substantiate that debts are owed before pursuing them and by banning the collection of time-barred debt. In addition, CR called on the Bureau to prohibit debt collectors from contacting consumers via social media and limit phone calls to three times per week for each debt.

Under the rule adopted under former CFPB director Kraninger, debt collectors can contact consumers by phone up to seven times a week about each debt. The new rule also allows debt collectors to send unlimited texts, emails, and social media direct messages without getting a consumer’s consent or any assurance that the consumer can access the information. The CFPB rule gives consumers the right to opt-out of these electronic communications, but fails to provide strict guidelines to ensure it will be easy for them to do so.