The Consumer Financial Protection Bureau issued a proposal to extend the effective date by 60 days for two rules under the Fair Debt Collection Practices Act (FDCPA) to give “affected parties more time to comply due to the ongoing COVID-19 pandemic,” according to a Wednesday release. This proposal would push the start date to Jan. 29, 2022, from Nov. 30 of this year.
The delay gives stakeholders extended time to review and implement the rules, according to the Bureau. The proposed extension will be open for comment for 30 days once published in the Federal Register.
The first rule affected, which was issued in October 2020, focuses on debt-collection communications. The rule “clarifies prohibitions on harassment and abuse, false or misleading representations, and unfair practices by debt collectors when collecting consumer debt,” according to the Bureau.
The second rule, issued in December 2020, requires the disclosure of debt to consumers prior to informing consumer reporting agencies of that debt, and bans debt collectors from threatening consumers with lawsuits or suing on debt beyond the statute of limitations.
Complaints against consumer debt collection companies are on the rise. In a March report submitted to Congress, the Bureau said it had received around 87,200 customer complaints regarding debt collection practices in 2020, a 10% year-over-year increase. The CFPB, under former Director Kathleen Kraninger, first announced changes to the FDCPA in May 2019.
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