House Bill Threatens Consumer Debt Collection Protections

The Consumer Financial Protection Bureau’s (CFPB) supervisory and enforcement authority is one of the ways that consumers in Oak Park, Illinois and throughout the country are protected by unfair and deceptive debt collection practices. However, according to a recent article in The Hill, the U.S. House of Representatives will vote on a bill that aims to limit the CFPB’s power and the reach of the Fair Debt Collection Practices Act (FDCPA).
What do debtors need to know about the bill and the ways it could affect debt collection practices in the U.S.?
Limiting the Scope of the FDCPA and the CFPB
We noted that the House bill could limit protections that are currently in place for consumers when it comes to debt collection. More specifically, the proposed legislation, H.R. 5082 or the Practice of Law Technical Clarification Act of 2018, “would exempt debt collection attorneys from the Fair Debt Collection Practices Act and preclude the Bureau of Consumer Financial Protection from exercising supervisory or enforcement authority over them.” In addition, the bill would “provide a perverse incentive for some debt collection law firms to engage in abusive and deceptive practices with impunity.”
In other words, the proposed legislation aims to limit the scope of the FDCPA and the CFPB by exempting debt collection lawyers. While there are many consumer protection lawyers who advocate for consumers and their rights under the FDCPA, there are also lawyers who work for debt collection companies. Those lawyers are responsible for lawsuits filed against debtors, and in some cases may be involved in other debt collection practices.
Role of Lawyers Who Work for Debt Collection Companies
Do lawyers working for debt collection companies actually play a role in harming consumers or violating the FDCPA? According to the article, nonprofit organizations have “documented widespread abuses by debt collection attorneys in courts across the country, including cases brought beyond the statute of limitations and scores of cases where people never received notice of suits, all of which results in wrongful judgments, often against the wrong people.” Moreover, situations in which debt collection companies sue consumers and those consumers do not have representation, the debt collection company almost always wins.
In addition, the article indicates that numerous debt collection lawyers “have become debt buyers themselves, recognizing how lucrative it is to hire themselves to collect on their own behalf.”
If the bill were to pass, the article suggests that more debt collection companies would turn to lawsuits against consumers because debt collection lawyers would not be held accountable for actions that violate the FDCPA. In effect, debt collection attorneys would be able to violate the FDCPA and the CFPB would not be permitted to hold them accountable.
Learn More from an Oak Park Consumer Protection Attorney
If you are being harassed by a debt collector, or if a debt collection company has filed a lawsuit against you, it is extremely important to have an experienced and compassionate Oak Park consumer protection lawyer on your side. Contact the Emerson Law Firm to learn more about how we can help with your case.
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