Consumers Need More Transparency Not Less, with Debt Collection Abuses
The last day of National Consumer Protection Week — “a time to help people understand their consumer rights and make well-informed decisions about money.”– is a prime opportunity to highlight much-needed transparency in an area that needs much improvement for consumer protection and rights: debt collection complaints.
The Consumer Financial Protection Bureau (“CFPB”) has received close to a quarter million debt collection-related complaints, making it the second largest category of complaints. Debt collection has also topped the Federal Trade Commission’s consumer complaint list for many years. According to these complaints, consumers are on the receiving end of a host of abusive behaviors such as excessive phone calls, threats of illegal action, misrepresentation of a debt, and attempts to collect debts that consumers do not owe.
This massive pile of complaints is a sign that consumers need more protection from debt collectors. It should not come as much of a surprise then, that the industry is terrified of the impact that the complaints could have on their bottom line.
A debt collector industry group recently published an open letter to the CFPB asking the agency to “revamp” its consumer complaint database. The group suggests that the CFPB should implement more rigid reporting categories, actively verify the accuracy of millions of complaints, and narrow the definition of “complaint” to cover only instances of unlawful conduct. If these changes were implemented, fewer complaints would be published and the number of debt collection complaints would be artificially deflated.
The industry attempts to pass off these proposed changes as being in the interest of generating more accurate data. But it’s far more likely that debt collectors are seeking to suppress consumers’ voice and make it more difficult for them to file complaints and receive help.
National Consumer Protection Week is supposed to be about empowering consumers. That is why these pleas for the CFPB to manipulate and restrain the highly successive consumer complaint database are such an affront. Consumers should be able to stand up for themselves and make good choices, but they need more access to information, not less. If abusive debt collectors want fewer complaints against them, they should consider changing their business practices instead of trying to silence consumers.
