U.S. Senator Sherrod Brown (D-Ohio) Tuesday sent a formal letter to Consumer Financial Protection Bureau (CFPB) Director Richard Cordray urging the federal watchdog to issue rules and regulations to tighten oversight of the debt collection industry. Brown also noted that the matter will need a legislative fix in the form of Fair Debt Collection Practices Act (FDCPA) reform.
Sen. Brown wrote that he is concerned about “the prevalence of debt collection abuses nearly 35 years after Congress first implemented” the FDCPA. Brown wants the CFPB to use the authority granted to it in the Dodd-Frank Wall Street Reform and Consumer Protection Act to issue “rules, regulations, and guidance for both creditors and third-party debt collectors to address systemic issues in consumer debt collection.”
Brown sits on both the Senate Finance Committee and the Committee on Banking, Housing, and Urban Affairs. He is the Chair of the Senate Banking Subcommittee on Financial Institutions and Consumer Protection, which would be the most likely first stop for any legislative fix to the FDCPA.
Brown told the Columbus Dispatch that he intends to hold hearings next month on updates to the FDCPA.
In addition to committee assignments that would give him control of FDCPA legislation, Brown is an outspoken supporter of Cordray, who also hails from Ohio. Brown introduced Cordray at a Senate confirmation hearing and has been at the forefront of the battle over Cordray’s appointment to the CFPB Director position.
In his letter, Brown made a number of specific recommendations for rules the CFPB can issue targeting the debt collection industry, including:
- Require that debt collectors, whether primary creditors or third party collectors, hold all relevant documentation before issuing their first debt collection notice to the consumer.
- Require that information on prior collection attempts travel with the debt.
- Prohibit the sale of unverifiable debts.
- Eliminate the sale or collection of time-barred debt.
- Issue updated guidance for consumer dispute procedures reflecting the new technological possibilities for documented consumer disputes.