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ARTICLE · 24 NOVEMBER 2020

The CFPB's Final Collections Rule: Impact On Credit Reporting

Ballard Spahr LLP
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This latest installment of our blog posts about the CFPB debt collection rule examines how the final rule will impact credit reporting

United StatesFinance and Banking
Kim Phan
Kim Phan
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This latest installment of our blog posts about the CFPB debt collection rule examines how the final rule will impact credit reporting.

As an initial matter, let's discuss what is not in the final rule.

  • Furnishing before communicating with the consumer: In the CFPB's proposed rule, §1006.30(a) would have prohibited a debt collector from furnishing information about a debt to consumer reporting agencies ("CRAs") under the Fair Credit Reporting Act ("FCRA") before communicating with the consumer about the debt. The CFPB justified this proposal by arguing that subjecting a consumer to pressure by furnishing information to a consumer reporting agency without first providing notice to the consumer constitutes conduct that may have the natural consequence of harassment, oppression, or abuse in violation of FDCPA §806, and that is an unfair or unconscionable means to collect or attempt to collect a debt under FDCPA §808. Specifically, the CFPB was concerned about

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