A Broader Application Of Fair Debt Collection Principles

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On July 10, the Consumer Financial Protection Bureau issued new debt collection guidance and announced broad application of the Fair Debt Collection Practices Act under Sections 1031 and 1036 of the Dodd-Frank Act. The guidance suggests that the CFPB views the acts and practices made illegal by the FDCPA to be Unfair, Deceptive And Abusive Practices (UDAAP) under a different name.

While the CFPB published a larger participant rule in October 2012, allowing federal supervision of certain consumer debt collectors and a field guide for use in examinations of companies and banks engaged in debt collection, the new guidance brings the rest of the market into the fold. In effect, all CFPB-supervised entities must comply not only with the DFA but also with aspects of the FDCPA governing the consumer experience of debt collection.

Originally Published in Law360, New York - July 12, 2013.

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Published In: General Business Updates, Consumer Protection Updates, Finance & Banking Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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