QTR . 1 | 2021
••• IN THIS ISSUE
> CFPB Issues Highly Anticipated Fair Debt Collections Practices Act Final Rule
> CFPB Issues Advertising Consent Orders
> CFPB Issues Consent Order for Overdraft Protection Violations
> CFPB Supervisory Highlights Summer 2020
CFPB Issues Highly Anticipated Fair Debt Collections Practices Act Final Rule
On Oct . 30 , 2020 , the Consumer Financial Protection Bureau ( CFPB ) released a final rule , Regulation F , implementing the Fair Debt Collections Practices Act ( FDCPA ). The recent release from the CFPB contains both the final rule and the official interpretation ( commentary ). The final rule is effective one year after it is published in the federal register . The CFPB also announced it will issue a final rule focusing on FDCPA disclosures in December 2020 .
Background
The FDCPA was enacted in 1977 . Among other things , the FDCPA : ( 1 ) prohibits debt collectors from engaging in harassment or abuse , making false or misleading representations and engaging in unfair practices in debt collection ; ( 2 ) restricts debt collectors ’ communications with consumers and others ; and ( 3 ) requires debt collectors to provide consumers with disclosures concerning the debts they owe or allegedly owe .
The FDCPA applies to those who regularly collect , or attempt to collect , directly or indirectly , debts owed , due or asserted to be owed or due to another . The CFPB opted to not expand the final rule to first-party debt collectors . Consequently , it does not apply to financial institutions collecting only their own debts , such as most credit unions and community banks . Note , although a financial institution may not have to comply with the FDCPA , doing so can lower the risk of allegations of unfair , deceptive or abusive acts or practices . Many banks and credit unions voluntarily comply for this reason .
Continued on page 2
1