Debt collection is a $13.7 billion industry in the United States that employs
over 130,000 people. At the Consumer Financial Protection Bureau (CFPB)
Field Hearing on Debt Collection on July 28, 2016, Director Richard Cordray
noted that much work still needs to be done in regards to how debt collectors
go about receiving payments. Despite protective measures put forth to
prevent debt collectors from using abusive tactics, consumers continue
to voice problems regarding collectors, including harassing phone calls,
threats of arrest or criminal prosecution, and even threats of physical harm.
This is particularly the case when creditors turn debts over to third parties,
which will go to great lengths to collect since they are paid based on
the amount they are able to retrieve from debtors. Consequently, the Consumer
Bureau as well as other agencies and officials in the federal, state,
and local government has received more complaints from the debt collection
industry than any other.
Another facet to this problem is the Fair Debt Collection Practices Act,
created to protect consumers, which was enacted nearly 40 years ago and
therefore does not address the new forms of technology that have emerged
since its inception. This has left room for much interpretation, creating
uncertainty for debtors and collectors alike.
At the CFPB hearing, the primary issue on the table was to address third-party
debt collectors. Companies should not be able to collect debt that was
not owed to them. Additionally, consumers should have more control over
the process of debt collection. Third-party debt collectors often have
limited information – usually basic data such as the name, address,
phone number, and amount owed – regarding the debt they are trying
to collect. Information regarding any disputes or if the debtor has legal
representation would be omitted. With such minimal information, sloppy
and even fraudulent practices frequently occur.
By cleaning up the process of debt collection, consumers may have more
power over their situation, relieving some of the stress and removing
the stigma of distrust toward the industry.
At Sulaiman Law Group, LTD., we are well versed in handling cases regarding
harassment and intimidation tactics, bankruptcy, debt discharge, and more.
Schedule a consultation with us at (312) 313-1613.