Debt collection problems: StepChange call on government to ‘get its house in order’

ACA International Leadership to Discuss its Comments on the Proposed Rule in Press Briefing Today

ACA International’s comprehensive comments in response to the Consumer Financial Protection Bureau’s proposed debt collection rule recommend fair and objective policies that clarify legal obligations for the accounts receivable management (ARM) industry and provide clarity for consumers. As the leading voice of the ARM industry, ACA International submitted more than 150 pages of comments Sept. 17, 2019 on the CFPB’s Notice of Proposed Rulemaking for the Fair Debt Collection Practices Act of 1977. (ACA’s comments are available on its website at

ACA International CEO Mark Neeb released the following statement: “The proposed rule rightfully acknowledges that the Fair Debt Collection Practices Act, which is more than 40 years old, does not account for modern consumer preferences and impedes the free flow of information that allows consumers the ability to continue to access credit and services. ACA, in its comprehensive comments, identifies a significant number of changes that should be made to the proposal to better balance privacy concerns, with the consumer benefits that are derived from engaging in open communication with the ARM industry.

“Our economy is heavily reliant on the creditors ability to collect rightfully owed outstanding debts. In 2016, our industry returned $67.6 billion of funds to U.S. businesses—that’s an average savings of $579 for every American household,” Neeb said.

Here’s a look at some of ACA’s top-level comments:

  • The CFPB’s proposed call cap of no more than seven calls in seven days, and separate requirement that an agency wait seven days before contacting a consumer after a telephone conversation, is not supported by evidence that it provides any consumer benefit. Instead, it will decrease direct contact between consumers and the ARM industry, and cause an increase in alternative contacts such as letters, texts, emails, etc. Ultimately, this will increase costs and the length of time it takes to resolve a debt. This could impact a consumers’ ability to access credit or services. And, the FDCPA already restricts collectors from placing calls to consumers repeatedly or continuously with intent to annoy, abuse or harass any person at the called number. Collectors are legally bound by this reasonableness standard, thus an arbitrary call cap is unnecessary.
  • Consumers indisputably increasingly prefer modern electronic communications—like email and text messages—over antiquated snail mail. Modern technology is more cost-effective and efficient for communicating critical information from the accounts receivable management industry to consumers. The CFPB needs realistic regulations on these communications methods for businesses to follow. (See Infographic)
  • Clear and plain language communication is best for consumers and the industry. Unfortunately, fear of plaintiff’s litigation and the “overshadowing” doctrine force collection agencies to use stiff and confusing statutory language that consumers deem intimidating.
  • Defining the limited content message and attempt to communicate under the FDCPA is important to provide clarity for leaving voicemails. The current statutory catch-22 has impeded the ability to leave voicemail messages, which has increased call volumes, and has warranted regulatory guidance for several decades.
  • Imposing onerous requirements that do not detail what it means to communicate with a consumer prior to furnishing information to credit reporting agencies regarding the consumer’s debt is an impermissible regulatory act. The FDCPA is not meant to govern credit reporting in this manner, and the Fair Credit Reporting Act (FCRA), which sets forth many requirements, does not require this.
  • The CFPB’s current proposal to create a uniform validation notice is important for both consumers and the industry. In its comments, ACA outlines several ambiguities created or not addressed by the model form including itemization, the tear-off form check box, failure to address litigation over interest accrued, among others. The comments outline in detail why new itemization requirements are unworkable for small businesses and for several types of debt, particularly medical, merchant and service debt.

Accounts receivable management industry professionals represent a diverse segment of the population made up of individuals who work hard to earn a day’s living, pay for their children to go to school, and put food on their tables. They want to work to help consumers find a solution to their financial problems. Over 70 percent of debt collection professionals are women; racial and ethnic minority groups account for 40 percent of the of total collection workforce. Industry employees spend more than 520,000 hours per year in volunteer activities.

Join ACA International’s leadership team as they discuss and analyze the industry’s position on the CFPB’s proposed debt collection rule. This media briefing is scheduled for 10 AM EASTERN Wednesday, Sept. 18.