The bureau is implementing a larger peer review for its research reports used by policymakers.
8/31/2020 15:00
The Consumer Financial Protection Bureau is adopting new procedures for external peer review of important research—with out-of-statute debt disclosures and quantitative testing issued in February 2020 as a starting point.
CFPB experts conduct various types of research to develop evidence that can inform the decisions policymakers face, according to a blog post by Jason Brown, assistant director in the CFPB’s Office of Research. “The strength of that evidence depends on the quality of the research. The bureau’s research is often highly technical, and therefore assessing the validity of the research can be challenging to policymakers and the public,” Brown reports.
External experts in the subject of the bureau’s research are called upon to review the work and provide an objective critique as part of the peer review process.
“The review typically covers several facets of the research, including whether the data and methodology used in the research are appropriate for the research question and whether the conclusions drawn from the analysis are consistent with the analysis,” according to Brown.
In the case of the out-of-statute debt disclosures and quantitative testing, this research was studied by the CFPB’s Academic Research Council (ARC) as a starting point in the peer review process.
The bureau is still determining the scope of research it will subject to this external peer review process, Brown reports
The original research report on out-of-statute debt, the bureau’s request for peer review, and the ARC’s peer review report to the bureau are available on the peer review website.
While ACA International and the accounts receivable management (ARM) industry await the bureau’s release of its final debt collection rule this year, out-of-statute debt disclosures will be the subject of a separate rule issued at a later date, ACA previously reported.
The CFPB will take final action on a Supplemental Notice of Proposed Rulemaking (SNPRM) on out-of-statute debt disclosures at a later date, according to the rulemaking agenda. Comments on the SNPRM were due in August. Read ACA’s comments on the SNPRM here.
The CFPB conducted research and testing on consumer disclosures related to out-of-statute debt that were not included in the May 2019 proposed rule for the industry.
The SNPRM supplements the bureau’s May 2019 proposed rule on debt collection practices. The new proposal would impose disclosure requirements with respect to out-of-statute debt and provides model language and forms that debt collectors could use to comply with the proposed disclosure requirements.
“ACA welcomes the bureau’s acknowledgment that the current state of the law is unclear, with varying requirements among jurisdictions across the country that cause confusion to collectors and consumers, and generates ongoing, wasteful litigation,” said CEO Mark Neeb and Vice President and Senior Counsel of Federal Advocacy Leah Dempsey in the out-of-statute debt comments.
However, ACA is concerned that the SNPRM may result in a new layer of obligations for the ARM industry as well as a continued lack of clarity and litigation unless the CFPB is able to preempt existing state laws and the accumulation of court decisions interpreting these requirements. In its comments, ACA offered several suggestions to modify the proposal if the bureau decides to establish new requirements with respect to out-of-statute debt.
Peer Review Process
According to the ARC’s peer review, the report provides an overview of the methodology and disclosure notices that were tested; the appendices and supplemental materials provide more detailed information about the survey instruments, potential disclosures and sample demographics.
The ARC reviewed potential limitations of the out-of-statute debt disclosure survey, such as the lack of a clear definition of a successful disclosure and the need for additional research on that to inform public policy decisions.
Other materials, as applicable, will be posted on the peer review website as they become available.
“The bureau believes that peer review of its important technical and scientific research will ensure the quality of its research,” Brown reports. “This in turn will strengthen the policy making that stems from the research, and it will give the public confidence that its policies are driven by the best available evidence.”
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