On 7/30/2021, the CFPB announced that two final rules issued under the Fair Debt Collection Practices Act (FDCPA) will take effect as originally planned, on November 30, 2021. This announcement comes after the CFPB issued a proposal in April 2021 that, if finalized, would have extended the effective dates to January 29, 2022. The CFPB has now determined that such an extension is unnecessary. Following this announcement, the CFPB will publish a formal notice in the Federal Register withdrawing the April 2021 proposal.
In their release, the CFPB explains that they proposed extending the final rules’ effective date by 60 days to allow stakeholders affected by the COVID-19 pandemic additional time to review and implement the rules. The public comments, however, generally did not support an extension as most industry commenters apparently stated that they would be prepared to comply with the final rules by November 30, 2021.
Therefore, the two final rules under the FDCPA will take effect in November. The first rule, issued in October 2020, focuses on debt collection communications and clarifies the FDCPA’s prohibitions on harassment and abuse, false or misleading representations, and unfair practices by debt collectors when collecting consumer debt. The second rule, issued in December 2020, clarifies disclosures debt collectors must provide to consumers at the beginning of collection communications. The second rule also prohibits debt collectors from suing or threatening to sue consumers on time-barred debt. Additionally, the second rule requires debt collectors to take specific steps to disclose the existence of a debt to consumers before reporting information about the debt to a consumer reporting agency.
The CFPB announcement can be found here.
The first final rule can be found here.
The second final rule can be found here.
The official withdrawal of the proposed rule in the Federal Register can be found here.