Normally, I try to be positive and optimistic (it’s much more pleasant that way!). However, to this point the CFPB has only made me concerned. I wonder about the agency’s plans and whether they will make the industry regulations and treatment better or worse. I hope I can someday soon join the Beatles in singing “We can work it out” as ALL interested parties come together to find appropriate solutions. A couple of things about the recent CFPB Field Hearing in Seattle did give me a tiny glimmer of hope that the CFPB also has that on its agenda.
First, just the fact that they held a meeting where both sides voiced their opinions and concerns is a good sign.
The CFPB seems interested in listening to both sides of the debt collecting issue and then implementing policies that will help both debtors and the ARM industry. (I am not yet convinced that they will listen equally to consumer advocates and our industry, however.)
The hearing included a panel discussion in which both consumer advocacy attorneys and debt collection industry experts participated. While I believe it’s important to understand all sides of an issue, I was bothered by how strongly the consumer protection representatives attacked our industry. One of their many ridiculous accusations was that the ONLY objective a collection agency has in calling someone at their home is to annoy and harass them into paying their debt. (Fact: Contacting a debtor via the phone is an effective method to discuss payment options, explain the debt, educate about financial practices, etc.)
I was proud of how the debt collection industry panelists discussed our side of the issue. Carrie Finney, Bill Allen and Chad Benson responded fairly to hostile comments by the consumer groups and adequately answered questions by the CFPB. Throughout their responses, our industry panelists made obvious our desires to comply with clearly stated regulations, the need of modernizing regulations and our wish to expel bad acting companies and help solve real industry issues.
Second, Richard Cordray, the Director of the CFPB, indicated his belief that debt collection can be done “in the right way.”
In his opening remarks, Director Cordray, shared his own collecting experience. He stated that years ago as a County tax collector he learned that it really is unfair that some people shirk their obligation and don’t pay their taxes. On the flip side, he said he also learned that some people, through no fault of their own (sickness, divorce, elderly, job loss, etc.), simply have financial challenges. Director Cordray said he strongly believes that debt collection can be done in the right way.
I agree with Director Cordray that debt collection can be done “the right way.” I also agree with industry experts that we need to partner with the CFPB—and even the consumer advocacy groups—and clarify the conflicting laws and regulations governing our industry. The CFPB has a big job to accomplish. Define “the right way to collect.”Help clarify and modernize conflicting laws and regulations. Find and expel “bad apples” from the industry. AND satisfy the demands of both the consumer advocacy and collection industry groups.
With the rest of the collection industry, I will be paying close attention to the CFPB’s next moves to see if the tiny glimmer of hope becomes something positive, maybe even something to sing about. We CAN work it out!
This article was written by Dave R