Collector - January 2021 - 23

a

COLLECTOR 01.21

s debt collectors continue to navigate the ongoing COVID-19
pandemic, they must also prepare to address new litigation trends
and issues that 2021 will present. Here are five key trends that the
coming year has in store for the industry.

CFPB'S FINAL DEBT
COLLECTION RULE

CARES ACT & CONSUMER
REPORTING

On Oct. 30, 2020, the CFPB released
its long-awaited final debt collection
rule-also known as Regulation F. The
rule aims to restate and clarify the
Fair Debt Collection Practices Act's
prohibitions on harassment and abuse,
false or misleading representations, and
unfair practices by debt collectors when
collecting consumer debt.
Among other things, the final rule: (i)
prohibits a debt collector from calling a
consumer about a particular debt more
than seven times within seven consecutive
days or within seven consecutive days of
having had a telephone conversation; (ii)
allows consumers to set preferences with
debt collectors on certain communications,
including communications with third parties
and allowing consumers a reasonable way to
opt-out of electronic communications; and
(iii) clarifies that the FDCPA's prohibition
on harassing, oppressive, or abusive conduct
applies to email and text messages.
Although the rule does not become
effective until Nov. 30, 2021, it represents
the CFPB's interpretation of the FDCPA.
For that reason, consumers and courts
will likely incorporate its provisions
into claims and opinions regarding debt
collectors immediately. Further, if the U.S.
Supreme Court significantly narrows the
Telephone Consumer Protection Act's
scope, consumers will likely shift to the
FDCPA for claims regarding excessive or
abusive telephone calls or other forms of
communication.

The Coronavirus Aid, Relief, and Economic
Security (CARES) Act, signed into law
March 27, 2020, will have ramifications
within the financial industry for years
to come. As it relates to debt collectors,
the CARES Act amends the Fair Credit
Reporting Act and requires furnishers
to report as " current " any account for
which a consumer is performing pursuant
to a COVID-19-related deferral, partial
payment, or forbearance agreement-
including missing one or more payments
as agreed. The CARES Act is silent as to
whether a consumer is required to provide
corroborating evidence of hardship to
qualify for this relief.
The " covered period " for these reporting
requirements started Jan. 31, 2020, and ends
120 days (about four months) after the end
of the national state of emergency concludes.
Since the national state of emergency is
ongoing, there is currently no end in sight for
these reporting provisions.
While the CFPB published a seven-page
FAQ memorandum addressing the CARES
Act consumer reporting requirements on
June 16, 2020, confusion remains as to the
contours and application of the consumer
reporting provision. Furnishers need to
evaluate their compliance management
systems and anticipate plaintiffs' attorneys
most likely targets: technical errors in the
application of Special Comment Codes,
" re-aging " claims where a furnisher resets
the date of first delinquency, and disputes
as to what constitutes an " accommodation "

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Collector - January 2021

Table of Contents for the Digital Edition of Collector - January 2021

Collector - January 2021 - Cover1
Collector - January 2021 - Cover2
Collector - January 2021 - 1
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