CFPB Final Debt Collection Rule v. NPRM
With the Consumer Financial Protection Bureau’s (CFPB or Bureau) release of its final debt collection rule on Friday, everyone is wondering the same thing: how does the final rule compare to the proposed draft included in the Notice of Proposed Rulemaking (NPRM)? the redline document is a very interesting read. You can see exactly what the CFPB changed (including specific word choices), kept the same, reserved, or deleted altogether.
the NPRM that outlined reasonable procedures for emailing disclosures, This entire section was deleted. Instead, the final rule simply states that E-SIGN must be followed.
The Know/Should Know Standard for Employer Email
While the Bureau kept the know/should know standard in certain sections of the final rule, it very clearly relaxed the standard as it applies to whether or not a debt collector knows they are emailing a work address for the consumer. The final rule maintains its restrictions against contacting a consumer at work if it’s inconvenient, and it provides certain restrictions about which domains a debt collector can email (e.g., they can use emails with publicly-available domains, such as gmail.com, unless they know that it is provided by an employer), but the Bureau is drawing a line in the sand when it comes to knowing whether an email is work-related.
Now, instead of knows/should know, the standard is simply “knows.” The Bureau adds in its commentary that it does not expect debt collectors to do a line-by-line, account-by-account manual review of email addresses to check if they are employer-provided.
• Verification of Debt: When it comes to a debt collector responding to verification requests, the rule now uses the term “sends verification” rather than “provides verification.”
• Inconvenient Time/Place: Sometimes, it’s hard to tell a consumers’ location based on information in the account placement. In the NPRM, the Bureau states what the debt collection should do if it is “unable to determine” the consumer’s location. The final rule changes this terminology—the rule now states what the debt collector should do “if the collector has conflicting or ambiguous information” about the location of the consumer.
• Sales/Transfers/Placements: The Bureau clarified the language it used when dealing with transferring or placing accounts. Now, instead of just “transfer” or “placement,” we have “transfer for consideration” and “placement for collection.”