Advocacy efforts on legislative proposals that could impact the accounts receivable management industry and ACA members continue on Capitol Hill. Editor’s note: This content is available for members only.
11/25/2019 14:00
ACA International continues to meet with many congressional offices to outline concerns with the House Financial Services Committee’s Fair Debt Collection Practices Act and debt-collection related bills, which advanced out of committee after a two-day markup in November. ACA has been advocating for some changes to these bills, and for the Senate not to take up the legislation, as outlined in letters to the House committee and most recently to U.S. Senate Banking Committee Chairman Mike Crapo, R-Idaho, and Ranking Member Sherrod Brown, D-Ohio.
Leah Dempsey, vice president and senior counsel, federal advocacy and Patrick Russell, federal advocacy manager, met with the Senate Banking Committee this week to discuss the flaws in the House legislation.
Brown and U.S. Sen. Marco Rubio, R-Fla., chairman of the Senate Small Business Committee, introduced companion legislation to the Small Business Lending Fairness Act (H.R. 3490), which would restrict confessions of judgment agreements for small-business owners.
H.R. 3490, introduced by U.S. Rep. Nydia Velázquez, D-N.Y., passed in the House Financial Services Committee by a 31-23 party line vote.
“ACA urges the Senate not to take up this bill,” said ACA CEO Mark Neeb.
Bills advanced by the House Financial Services Committee also focus on directives to extend the FDCPA to debts owed to state and local governments and there is a companion Senate bill introduced by U.S. Sens. Cory Booker, D-N.J., and Mike Lee, R-Utah, that has some of the same directives.
ACA also believes more research is needed on many of the bills before the House and Senate proceed with action on Capitol Hill, including the “The Debt Collection Practices Harmonization Act,” (H.R. 3498), which would extend the FDCPA to cover debt owed to a state or local government and adds specific requirements for national disasters passed with amendments.
“Collecting government owed debt is an important part of a functioning economy and there may be a unique need for consumers to be able to efficiently resolve debts owed to a local government, for example maintaining a valid driver’s license,” Neeb said.
This bill also allows the damages amounts under the FDCPA to be tied to inflation. Increasing statutory damages will only attract more frivolous litigation based on highly technical ambiguities in the law and harm business working to comply with the law that are not actually causing harm to consumers.
“The FDCPA is already regularly exploited by opportunistic plaintiffs’ lawyers seeking to profit from the statutory damages based on highly technical ambiguities in the law. Increasing these damages will only attract additional frivolous litigation, clogging up the court system and harming many businesses actively working to comply with the law, who are not actually causing harm to consumers,” Neeb said. “We urge the Senate not to take this bill up and instead study the volume of legitimate vs. non-legitimate lawsuits and determine whether strict liability is appropriate.”
ACA’s concerns with the recent legislation also extend to proposals including restrictions on communicating about government debt.
An amended version of the House “Stop Debt Collection Abuse Act,” (H.R. 4403), sponsored by U.S. Reps. Emanuel Cleaver, D-Mo., and French Hill, R-Ark., received unanimous support at the House committee level with a 54-0 vote Nov. 13.
H.R. 4403 would extend the FDCPA to collectors of debt owed to a federal agency and limit any interest, fee, charge or expense incidental to the principal obligation. It also mandates that debt buyers are subject to the FDCPA and requires a Government Accountability Office study on the use of debt collectors by local, state and federal agencies.
“Communicating about debt owed to the government is unique, for example, providing information about outstanding student loans may help borrowers avoid penalties or other negative consequences such as the ability to obtain a federal government job,” Neeb said. “The House committee’s vote is concerning to ACA because there has been little research or analysis done about the impact a bill like this could have on the economy, credit being extended by the federal government, and consumers. We urge the Senate not to take up this bill and defer these FDCPA issues at this time to the CFPB, which is currently engaged in rulemaking in this area.”
Several other bills addressed in ACA’s letter also cover issues under review by the CFPB through its proposed debt collection rulemaking as well as consumer protection requirements in place at the state level. ACA thanks the Senate for their consideration of delaying action on these measures.
ACA will continue its advocacy surrounding these bills. It is unclear yet, if and when, any of the bills will be taken up on the House floor following the committee’s markup.
Read Neeb’s complete letter to the committee on ACA’s Advocacy Resource Center webpage.
ACA’s advocacy team will also host a webinar in December recapping advocacy efforts in 2019. Watch your email for ACA Daily and events updates for more information coming soon.
Related Content from ACA International:
Advocating for Regulatory Guidance on Capitol Hill
ACA Outlines Industry and Consumer Impacts in Congressional Debt Collection Legislation