Last week the CFPB posted the above Bulletins on the Guidance documents page of its website http://www.consumerfinance.gov/. Both Bulletins concern prohibited practices in connection with the collection of consumer debts. Bulletin 2013-07 deals exclusively with the unfair, deceptive, or abusive act or practice (UDAAP) prohibitions under the Dodd-Frank Act (see §§1031 and 1036(a), codified at 12 U.S.C. §§5531 and 5536(a)). The Bulletin explains the terms “unfair act or practice,” deceptive act or practice” and “deceptive act or practice” and gives non-exhaustive examples of UDAAPs. The CFPB states in the Bulletin that it will review closely the practices of those engaged in the collection of consumer debts for potential UDAAPs and will assess whether supervisory, enforcement, or other actions may be necessary. To print a copy of Bulletin 2013-07, click here. Bulletin 2013-08 concerns representations made to the consumer about the impact that a payment on a debt in collection may have on the consumer’s credit report, credit score, creditworthiness or the likelihood of receiving credit or more favorable credit terms, and that some of these representations may be deceptive under the Fair Debt Collection Practices Act or the UDAAP prohibitions under the Dodd-Frank Act, or both. The Bulletin gives non-exhaustive examples of potentially deceptive representations concerning the effect of paying debts in collection on credit reports, credit scores and creditworthiness. The CFPB states in the Bulletin that the prevalence of these types of potentially deceptive representations is of significant concern to the CFPB and that they will be part of its supervision activities and enforcement investigations. Download complete memorandum below
