Debt Collectors Get Federal Agency Oversight

by San Antonio Attorney

The Consumer Financial Protection Bureau has announced that it is going to keep track of the everyday operations of large debt collection agencies.

For the first time, debt collectors have become the subject to close scrutiny of the federal government for their regular business practices.

The move adds the list of industries that the Consumer Financial Protection Bureau oversees. The agency was created following the financial meltdown to protect the people from deceptive marketing, unfounded charges and various other unfair practices.

Many consumers have been complaining about the unfair practices of debt collectors such as contacting the employers of those who are unable to pay back debts or taking legal actions against those who owe a fairly small amount of money. There are certain practices that are against the federal disclosure guidelines and rights against intimidation and harassment.

Approximately 30 million of U.S. consumers have an average debt of $1,500 which has been handed over to the debt collection industry, according to the agency. Considering that this type of information usually is reported to credit reporting agencies, the debt collectors have the ability to affect a consumer’s ability to take a car loan or the interest mortgage rate that he or she pays on a home loan.

The mortgage companies, payday lenders and private student lenders are under the supervision of the bureau. Those industries were placed directly under the Consumer Financial Protection Bureau watch when it was established in 2010.

Credit bureaus and debt collectors are the two groups that the agency is selecting to include in its supervision program. It started keeping track of credit bureaus a few weeks ago.

Regardless if there is no sign that the company has done something wrong, the regulators can demand information from the company under the supervision program. Examiners and supervisors can evaluate advertisements, consumer disclosures, phone scripts, and other parts of a business.

– Debt collectors have to comply with the state and federal regulations when collecting debts. They are prohibited to verbally abuse, assault, threaten, seize property or harass people. If you need help in dealing with abusive debt collectors, talk to a San Antonio Attorney.

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