On June 27, Sen. Al Franken (D-Minn.) introduced S. 3350 (End Debt Collector Abuse Act of 2012) and S. 3351 (Protect Our Health Privacy Act) proposing changes to the Fair Debt Collection Practices Act (FDCPA) and federal health care privacy laws.
S. 3350, which seeks to achieve the following, has been referred to the Senate Committee on Banking, Housing, and Urban Affairs:
- Modify the FDCPA to include increasing statutory damages under the law. An outline of the legislation on Franken’s website reads, “Due to inflation, debt collectors who break the law today are effectively getting a 74% discount. For that reason, the bill would raise statutory damage limits to reflect inflation since 1977 and index them to inflation going forward.” The bill proposes that beginning every fiscal year, statutory damages should be increased by a percentage rounded to the nearest $100 or $1000 based on the Consumer Price Index.
- Adds requirements for sending written validation notices, including requiring collectors to provide consumers with: an itemization of the principal, fees, interest, and any other charges that make up the debt, including any other charges added after the date of the last payment made by or on behalf of the consumer on the subject debt.
- Mandates that consumers be provided with information about how to request that a debt collector cease communication or stop collection efforts.
- Requires that the name and contact information of the person responsible for handling complaints on behalf of the debt collector is provided. Additionally, for disputed debt, the bill proposes new language for conducting investigations.
- Proposes to add a new paragraph under the FDCPA to include creditors and medical debt collectors specifically under the law.
- Prohibits debt collectors from seeking arrest warrants to collect debts. ACA has disagreed with comparing the practice of seeking arrest warrants to supporting ’debtor prisons.’ ACA has noted that claiming that debt collectors are manipulating our judiciary system for their exclusive benefit is simply wrong and runs counter to judicial independence.
S. 3351, which seeks to amend federal health care privacy law, has been referred to the Senate Committee on Health, Education, Labor, and Pensions.
ACA is currently reviewing Sen. Franken’s proposed legislation and its impact on members.