Consumer Financial Protection Bureau Releases New Final Rule Modernizing the Fair Debt Collection Practices Act | Goodwin
On October 30, 2020, the Consumer Financial Protection Bureau (CFPB) issued a new final rule the implementation of the Fair Debt Collection Practices Act (FDCPA). According to the CFPB press release, the new final rule is designed “to reaffirm and clarify the prohibitions on harassment and abuse, false or misleading representations and unfair debt collection practices when collecting consumer debts”. In general, the CFPB’s revisions to Regulation F, 12 CFR part 1006, strengthen protections for consumers who communicate with debt collectors and clarify the application of the FDCPA to new communication technologies that have developed over the four decades since. the adoption of the FDCPA in 1977. In a blog post Written by CFPB director Kathleen L. Kraninger, the director writes that the new rule “provides clear rights and limitations to consumers for debt collectors on the use of modern technology to communicate with each other.”
The new rule includes significant calling frequency requirements. Specifically, it clarifies that a debt collector is alleged to be in breach of the FDCPA’s ban on repeated or continuous phone calls if they call a person more than seven times in a seven-day period or within seven. days after engaging in a telephone conversation with the person. To respond to modern electronic communication methods such as email and text messaging, the new rule clarifies how consumers can set limits on debt collection communications to reflect their preferences for the method of communication. Debt collectors who communicate with consumers electronically must provide a reasonable and simple method for the consumer to opt out of such communications to a specific email address or phone number. The rule also provides that consumers can, if the debt collector communicates by an electronic means of communication, use that electronic means of communication to file a request for cessation of communication or to notify the debt collector that he refuses to pay the debt. .
However, the new rule balances greater consumer protection with additional guidance for debt collectors on how to ensure compliance with the FDCPA. For example, the rule specifies that a debt collector is presumed to comply with calling frequency prohibitions if he makes a telephone call that does not exceed the aforementioned calling frequencies. The final rule also provides that a debt collector can avoid civil liability in the event of unintentional disclosure by a third party of information regarding a consumer debt if he follows the procedures identified in the rule when communicating with a consumer by email or SMS. a message. Finally, the rule defines a new term related to debt collection communications: message with limited content. This definition identifies the information that a debt collector must and can include in a voice message to consumers (without the inclusion of other authorized information) in order for the message to be deemed not to be a communication under the FDCPA.