Of all the areas of Regulation F that collectors are grappling with, perhaps the most challenging is the new validation notice, which collectors will be able to use to communicate specific information to consumers about their unpaid debts. The model validation notice offers some important benefits to collectors, but comes with its own set of challenges. Outside of the provisions for communicating with consumers using email and text messaging, Regulation F’s most important updates to the Fair Debt Collection Practices Act could, in fact, be this new validation notice and the new definitions and requirements that go along with it. In this episode of “You Wanted a Rule, You Got a Rule,” John Bedard of Bedard Law Group starts walking through Section 1006.34, the Notice for Validation of Debts, which is the section covering the information that needs to be included in the validation notice.
Collectors have been required to provide consumers with validation notices since the FDCPA was enacted more than four decades ago. Just as with the FDCPA, under Regulation F, collectors can communicate information about validating the debt in writing or over the phone. And, just as with the FDCPA, collectors are not required to communicate the validation notice if the consumer pays the debt in full prior to the expiration of the five-day period that a collector has for sending that information to the consumer.
Like a good meal, Section 1006.34 starts off with a tasty appetizer before getting to what Bedard calls the meat and potatoes of the section, which covers many of the details that collectors will need to learn in order to communicate the validation information properly.
“The term ‘validation information’ is not in the [FDCPA] anywhere,” Bedard notes. “And so what we used to say, is that a debt collector was required to provide the validation notice and ‘validation notice’ was really industry jargon, we all sort of understood what that meant based upon what we call the g-notice disclosures in 1692g of the statute. Now, the Bureau has defined this thing called validation information, which includes an enormous amount of information about the debt, about the consumer, about consumer rights, and about all kinds of things that you will not find anywhere in the statute. And so, so there is additional information that a debt collector is going to have to provide consumers when these rules become effective. and that information is described as validation information in Regulation F.”
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