The Consumer Financial Protection Bureau (CFPB) Wednesday presented its annual report to Congress on the administration of the Fair Debt Collection Practices Act (FDCPA) in 2012. It is the second FDCPA report the Bureau has submitted after taking over primary enforcement duties from the FTC.

Under the FDCPA, the executive branch agency charged with primary enforcement of the law must issue an annual report on its activities to Congress. Although the Dodd-Frank Consumer Protection Act, which created the CFPB, does not subject the Bureau to Congressional appropriations, it still must comply with the reporting requirement in the FDCPA.

In 2012, the CFPB was very involved in the regulation of the debt collection industry, a sharp departure from its first report issued last year that covered only five full months of activity in 2011.

The most significant development in 2012 was the finalizing of supervision rule for large debt collection market participants. The proposed rule was discussed for much of 2012 and finalized in October. Under the authority granted to the CFPB and per the final rule, the Bureau will be actively supervising market participants “with more than $10 million in annual receipts resulting from consumer debt collection.” This will include on-site examinations of business activity.

The rule went into effect January 2, 2013, so the 2012 FDCPA report did not include any updates on supervision and examination activities. But the report did note that On October 24, 2012, the Bureau released Debt Collection Examination Procedures, which provides guidance on how the Bureau will be conducting its monitoring of both banks and nonbanks engaging in consumer debt collection.

The report also detailed consumer complaints against debt collectors. The CFPB has a very different complaint system than any other federal agency, and it is not yet accepting complaints about debt collection. In fact, the report did not address when that may happen, only that the CFPB “continues to work towards expanding its complaint handling to include other products and services under its authority, including debt collection.”

For the 2012 report, the CFPB used complaints filed with the FTC. It does drill down into the complaint data in a way not seen before from a federal agency (although seen extensively here on

On the consumer advocacy front, the CFPB noted that it had filed a number of amicus briefs in several FDCPA-related court proceedings, including the recently decided Marx v. General Revenue Corp. Supreme Court case.

Because the CFPB has not had much time to prepare, launch, and finish full investigations resulting in enforcement actions, it reported only one action relating to debt collection: an October 2012 settlement with American Express. The FTC still engages in most enforcement actions. As such, the FTC provided a letter to the CFPB detailing its activities under the FDCPA in 2012.

In its letter, which is included in the CFPB report, the FTC listed the various enforcement actions it took against debt collectors last year. The FTC also noted an investigation that did not result in an action but did see a “closing letter” issued which addressed the collection of time-barred debt.

In August 2012, the FTC’s staff closed its investigation of RJM Acquisitions LLC for possible FDCPA violations concerning time barred debt. RJM is a debt buyer that attempts to collect on debts it purchases from original creditors, some of which are time barred. The staff’s closing letter explained that, even in the absence of any affirmative representations that consumers will be sued to collect time barred debt, merely attempting to collect on such debt may lead consumers to believe that such suits may occur.

At’s recent ARM Regulatory Summit in Washington, DC, an audience member asked FTC Associate Director Reilly Dolan about this specific case, from the perspective of a collection agency that has to endure an investigation which results in no action. Listen to the question and Dolan’s response below:

FTC Question on Closing Letter at ARM Regulatory Summit

The CFPB’s full report to Congress can be read at


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