On November 16, the Consumer Financial Protection Bureau (CFPB or Bureau) released its Fair Debt Collection Practices Act (FDCPA) Annual Report detailing the CFPB’s 2022 activities related to debt collection practices. This comprehensive document summarizes everything FDCPA-related undertaken by the agency during 2022, including enforcement actions, a summary of consumer complaints, education and outreach initiatives, and highlights from examinations it conducted. In addition to summarizing activities in the debt collection space from the past year, the report hints at potential future activities. Tellingly, the CFPB’s focus in 2022 was predominantly on medical debt, as highlighted by its press release announcing this report.

In the report’s overview, the CFPB represented that in 2022 it forwarded more than 60,000 debt collection complaints to companies for review and response. Of these, approximately 8,500 (or 15%) pertained to attempts to collect a medical bill. According to the Bureau, consumers raised a variety of issues, including attempts to collect on bills they did not owe and concerns about the quality of information received during the collections process. In response, many medical debt collectors closed the account, returned the account to their client, or deleted the item. According to the CFPB, this typically would occur without any follow-up questions from the collector to the person who disputed the debt, which raised questions for the Bureau as to whether there were deficiencies in the quality of information collectors receive at placement or sale of an unpaid medical bill.

In its report, the CFPB emphasized that collection activity on debts that are not actually owed or collecting the wrong amount may violate the FDCPA, its implementing regulation, and/or the Consumer Financial Protection Act’s prohibition on unfair, deceptive, or abusive acts or practices, none of which is new. This includes collecting for services the patients never received, collecting for more expensive versions of services than what were provided, or collecting amounts based on rates that are inconsistent with applicable state law.

Additionally, the Bureau noted that several states have proposed or enacted laws in recent years providing significant consumer protections with respect to the collection of and credit reporting on medical debts. According to the CFPB, preemption of state law with respect to medical bills is narrow under both the FDCPA and Fair Credit Reporting Act, and preemption would generally not apply to state restrictions on the collection, furnishing, and reporting of medical bills.

The CFPB’s report also incorporated a summary provided to the Bureau by the Federal Trade Commission (FTC) of its activities in the debt collection space. Highlights included:

• Litigating two cases against debt collection operations who allegedly used a variety of illegal tactics to target small businesses;
• Issuing more than $1.27 million in refunds to consumers harmed by allegedly unlawful debt collection practices;
• Halting millions of dollars in debt collections that allegedly originated from illegal financing and sales practices; and
• Providing tens of millions of people educational materials, in both English and Spanish, informing consumers about their rights, and educating debt collectors about their responsibilities, under the FDCPA and FTC Act.