September 20, 2019
LANSING – Michigan Attorney General Dana Nessel yesterday joined 27 other Attorneys General in urging the Consumer Financial Protection Bureau (CFPB) to revise its proposed debt collection rule and place the interests of consumers over those of debt collectors.
“Debt collection abuse is a serious and widespread problem for many Michigan residents who work tirelessly to make ends meet,” said Nessel. “Not only will this proposed federal rule allow debt collectors to call multiple times per week on each debt, but it will also allow them to make contact via social media. We expect the Consumer Financial Protection Bureau to do what their name suggests: financially protect consumers, and that means ensuring debt collectors respect the balance between lawful debt collection and consumer protection and privacy.”
In their letter, the Attorneys General recognize the importance of lawful debt collection. However, that does not grant debt collectors free rein to do so “in whatever manner they wish.”
The proposed federal rule falls short of protecting consumers by allowing debt collectors to:
“Despite decades of public and private enforcement of the Fair Debt Collection Practices Act, widespread deception and abuse have continued in the $11.5 billion debt collection industry. It’s incumbent on us to object to this proposed rule, because it doesn’t present consumers with the meaningful protections they need or deserve,” Nessel added.
In their letter, the Attorneys General commend certain aspects of the rule including its prohibition of “passive debt collection” — a particularly coercive practice in which debt collectors report debts to credit reporting agencies before attempting to collect on them.
Attorney General Nessel joins the Attorneys General of California, Colorado, Connecticut, Delaware, the District of Columbia, Idaho, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, and Wisconsin in sending this letter to the CFPB.