CFPB to Monitor Debt Collection Agencies
The federal government has authorized the Consumer Financial Protection Bureau (CFPB) to keep a watch on the operations of the nation’s major debt collection agencies following consumer complaints of unfair debt collection practices.
The Associated Press (AP) reports that some debt collection agencies resort to unfair collection practices such as harassing and intimidating consumers who are unable to pay off their debts or who have missed any installments. Some of these activities – such as calling the employer of someone who owes money – may violate federal laws. Such abuses led the federal government into empowering consumer watchdog agency CFPB to oversee the debt collection industry.
Around 30 million Americans have an average outstanding debt of $1,500, writes AP. After the mortgage companies, private student lenders, payday lenders, and credit bureaus, it is now the turn of debt collecting agencies to be monitored and supervised by CFPB to prevent unfair debt collection practices.
According to the new authority given to the CFPB, the agency can supervise non-bank companies, file civil charges, or take enforcement action against any company that violates consumer laws, even if the company is not part of its supervision program, reports AP.
All the debt-collection agencies that have more than $10 million in annual receipts would come under the supervision of CFPB. The supervision starts in January 2013 and will cover 175 debt collectors, amounting to almost 60 percent of the industry’s annual receipts, reports AP.
If you or a loved one has been wronged by unfair debt collection, contact Sokolove Law today for a free legal consultation and to find out if a consumer lawyer may be able to help you.