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CFPB Reaches New Low

Better Markets’ Dennis Kelleher says the Consumer Financial Protection Bureau continued its transformation into the Financial Predator Protection Bureau this month with a proposed rule that would unleash predators on low-to-no income people.

In early August, Better Markets filed a comment letter on a supplementary CFPB rule proposal that amended previously proposed rules governing debt collection practices, specifically time-barred debts. Time-barred debts are old debts that are unenforceable by the courts and cannot be collected.
 
Yet this supplementary proposal from a so-called “consumer protection agency” would allow predatory debt collectors to continue to harass, frighten and confound consumers until they make payments on these debts.
 
In a statement, Kelleher says the CFPB’s proposed rule is “despicable.”
 
“Continuing its transformation of the Consumer Financial Protection Bureau into the Financial Predator Protection Bureau, the CFPB’s proposed rule to unleash predators on low-to-no income people to collect debts that are by law uncollectable is despicable,” Kelleher says. “No one would knowingly revive a time-barred debt that he or she simply cannot afford to pay because that person is already in extreme financial distress and can barely make ends meet.” 
 
He adds that state laws have long provided that creditors can no longer sue to collect on debts that have become stale after years have elapsed.
 
“These are fundamental consumer protections that prohibit poor people from being harassed by debt collectors literally into the grave,” Kelleher notes. “While debt collectors may never give up preying on the poor, the CFPB should not help them by enabling and, indeed, legitimizing such predatory behavior.”
 
The CFPB was founded to protect consumers and not to make life easier for collection agencies chasing down years and sometimes decades’ old debts. The bureau should abandon its current course of action and propose debt collection rules that actually protect consumers.

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