It is shaping up to be a very interesting Fall for the credit and collection industry, one that could re-shape the industry for a generation to come.
The Consumer Financial Protection Bureau this week published its Spring rulemaking agenda and indicated that it is planning to release its final debt collection rule in October, days before the presidential election. There will be a 12-month period before the rule actually goes into effect, giving companies plenty of time to prepare and make the necessary changes.
On top of those huge developments, the CFPB is still working on a supplemental rule governing time-barred debt disclosures, and said it would address that “at a later date.”
The CFPB’s publication of its rulemaking agenda coincided with the ruling from the Supreme Court in Seila Law v. CFPB, which determined, once and for all, that the single director leadership structure of the Bureau is unconstitutional because it gives the director too much power. Whether that means the CFPB will be changed to a multi-member commission, like the Federal Trade Commission or the Federal Communications Commission, or if the agency will continue to be helmed by one person who can be fired by the president for any reason remains to be seen and either scenario could have a significant impact on any regulation being promulgated by the Bureau.
[EDITOR’S NOTE: Click here to sign up for a free webinar on July 2 that will analyze the Supreme Court’s ruling in Seila Law v. CFPB and its impact on the credit and collection industry.]
There have been calls from lawmakers and consumer advocates for the CFPB to pause all of its rulemaking activities during the coronavirus pandemic, but the CFPB appears to be moving forward on these long-awaited rules.
The CFPB announced its intention to issue a debt collection rule in 2012. Since then, there was an Advanced Notice of Proposed Rulemaking, a panel with representatives from the industry discussing what it would like to see in the proposed rule, and the release of the proposed rule last May.
