The Consumer Financial Protection Bureau (CFPB) recently published and submitted to Congress, its Fair Debt Collection Practices Act (FDCPA) 2016 Annual Report[i], detailing its activities in protecting consumers and enforcing consumer laws. In the report, the CFPB lists the number and types of consumer complaints it received, its supervision of debt collection activities, enforcement of Federal Trade Commission (FTC) and other applicable laws, and its efforts in education and outreach. The report begins with a message from CFPB Director, Richard Cordray, who notes that the CFPB “is the only federal government agency dedicated solely to consumer financial protection. Unlawful debt collection practices can cause harm to consumers across virtually all the consumer financial markets we oversee.[ii]” Here at the Zamparo Law Group, advocating for consumers, we frequently publish articles and share resources helping consumers learn the law, be able to spot, and report consumer law violations. We represent victimized consumers, sue, and win against abusive and deceptive business operators who violate consumer law.
Consumers and debt collectors are the primary parties considered in the Fair Debt Collection Practice Act (FDCPA), (the Act), written to protect consumers from unfair business practices by third party debt collectors. The FDCPA protects consumers of goods in the marketplace for personal consumer use, where a debt is due, and a debt collector attempts to collect the amount due. The FDCPA only applies to the actions of debt collectors who are third parties with right to collect the debts of another. Click/tap here to read our blog article about the FDCPA, Consumer protection overview of the Fair Debt Collection Practices Act.
Summary of the FDCPA 2016 Annual Report by the CFPB
The CFPB, created July 21, 2011, is authorized by the Dodd–Frank Wall Street Reform and Consumer Protection Act. In July 2013, the CFPB started collecting, investigating and responding to consumer complaints of FDCPA violations. The primary issue reported by consumers and the attorneys representing them concerned debt collectors who continued attempting to collect debts that individuals did not owe; representing 40 percent of complaints received during the 2015 calendar year.[iii]
Following continued attempts to collect debt not owed, in the order of frequent complaints, are debt collector communication tactics, failure to disclose verification of debts, taking or threatening illegal actions, making false statements or representations, and the improper contact or sharing of information.
Bureau supervision of debt collection activities
The Dodd-Frank Act gives the CFPB the authority to supervise banks and similar organizations offering consumer financial products and services. Examples of companies under CFPB supervision include residential mortgage companies, payday lenders, and private student lenders. In the regular course of CFPB supervision, a number of violations by debt collectors were discovered[iv] in the following situations:
- Failure to state that a call is from a debt collector
- Failure to implement consumer requests regarding communications
- False, deceptive or misleading representations regarding credit reporting
CFPB and FTC law enforcement actions
The CFPB takes significant action against FDCPA violators, some of whom are chronic offenders. The report lists summaries of numerous CFPB law enforcement actions for improper debt collection, detailing the millions of dollars violators are ordered to pay to swindled consumers in class action lawsuits. The FTC also files debt collection cases seeking money damages in addition, the “Commission obtained preliminary relief that included ex parte temporary restraining orders with asset freezes, immediate access to business premises, and appointment of receivers to run the debt collection business.[v]”
A section of the enforcement section of the report addresses a fight against “phantom debt collectors” who engage in unfair, deceptive and abusive conduct, trying to collect debt that either does not exist or is not owed to the phantom debt collector.[vi]
The remaining sections of enforcement data address debt collection via unlawful text messages and email, egregious collection practices, debt brokering and data security, as well as debt collection advocacy, including the CFPB and FTC cooperative efforts in writing amici (friends of the court) briefs in enforcement actions.
Education and outreach initiatives
The CFPB works to educate consumers and help them make sound financial decisions. Certain consumer populations are targeted with education, the ones who are also most likely to be targets themselves: “students, older Americans, service members, veterans and low-income and economically-vulnerable consumers.[vii]” Online resources are frequently developed and improved to help consumers learn consumer law in plain English and empower them to take action and fight back against consumer rights violations.
As the CFPB continues developing education and outreach initiatives, the Zamparo Law Group will continue advocating for consumers by sharing the important information consumers need to protect themselves and others from unfair, deceptive and abusive business operators who prey on consumers.
The Zamparo Law Group helps men and women fight back against the individuals and organizations that target them in consumer fraud and ignore the Fair Debt Collection Practices Act. We fight and win in court, individually and in class action lawsuits.
The Zamparo Law Group, P.C. is a consumer protection law and litigation firm, representing consumer plaintiffs. Zamparo Law Group in the northwest suburbs of Chicago sues and wins against the companies who refuse to follow the law.
To learn more about consumer protection law and the Zamparo Law Group, please visit the firm’s website. You may also ask for a free case review. The Zamparo Law Group is connected on social media, please follow us and share our resources we share on our Facebook, Twitter and LinkedIn pages. You may call the Zamparo Law Group with any questions by dialing (224) 875-3202.
[ii] See Annual Report (HNi) above at page 2
[iii] See Annual Report (HNi) above at page 18
[iv] See Annual Report (HNi) above at page 23-26
[v] See Annual Report (HNi) above at page 39
[vi] See Annual Report (HNi) above at page 43
[vii] See Annual Report (HNi) above at page 89