Will Creditors Face Actions Over Their Debt-Collection Practices by the CFPB or the Class-Action Bar?

Companies that provide credit to their customers are well aware that the Fair Debt Collection Practices Act (FDCPA), which authorizes suits against violators for statutory damages of up to $1,000, applies only to "debt collectors"—not creditors. 15 U.S.C. § 1692k.

But a recent bulletin (pdf) by the CFPB—whose commissioner Richard Cordray was just confirmed by the Senate—may open the door to actions against creditors (albeit under the Dodd-Frank Act rather than the FDCPA). That bulletin states that entities covered by the Dodd-Frank Act must "refrain from committing unfair, deceptive, or abusive acts or practices" in "collecting consumer debts."

The bulletin makes clear that the CFPB will be using the Dodd-Frank Act to apply the FDCPA to creditors. The bulletin then sets forth a "non-exhaustive list" of debt-collection practices that it says could violate Dodd-Frank and that the CFPB "will be watching ... closely." The list is essentially a compilation of