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The New Sheriff Policing Debt Collection Agencies: Consumer Financial Protection Bureau

December 13, 2011 | Comments: 0 | Views: 66

Posse's of rogue debt collectors are swiftly heading for the hills to hide from the new kid on the regulatory block - the Consumer Financial Protection Bureau (CFPB). As of July 21, 2011, they opened for business, and in the enforcement ball field this hard ball slugger wields a BIG STICK. Amongst its enforcement arsenal to protect consumers is the Consumer Financial Protection Act. And collection agencies are bracing for a lot of pounding and aftershocks. Once this federal agency flexes its far-reaching powers, it's going to get ugly.

Thankfully, if you're a consumer in debt, Debt Free League wants you to know this is all good news. At last, bill collectors will have a reason to contemplate about violating your consumer rights. Or else, there's a lot you can do to get even with the violators with some help from the CFPB. If they fail to operate by the rule book, this powerful agency can easily put virtually any debt collection agency "out of business."

The New Sheriff in Town

The Consumer Financial Protection Bureau is cool refreshment for millions of Americans that are experiencing greater difficulties paying off hefty bills on credit cards, student loans, and utilities. Since 1977, the only true law that governed how debt collection agencies should communicate with consumers has been the Fair Debt Collection Practices Act (FDCPA). However, its watchdog agency, the Federal Trade Commission (FTC), only had the authority to enforce the Act. But, times have changed. Soon, the CFPB will be eating the lunch of law-breaking debt collectors with a bag of tricks that goes beyond the FTC's enforcement powers...

Superman in Debt Collection Rule Making and Enforcement

The Consumer Financial Protection Bureau also joins ranks with the Federal Trade Commission to enforce the Fair Debt Collection Practices Act. Furthermore, it is the enforcer of the new Consumer Financial Protection Act. But what make this new agency so unique is that it does much more than enforce consumer protection laws. Here's a glimpse of the broad powers of the Consumer Financial Protection Bureau:

- Enforcement and rule making authority;

- Authority to enforce the Consumer Financial Protection Act and other CFPB regulations;

- Power to request compliance reports, conduct financial examinations and investigations;

- Authority to bring enforcement actions in federal court, and issue cease and desist orders;

But, wait, there's MORE...

Debt Collection Agencies Face Crippling Fines

Before the regulatory agency, there wasn't much monetary punishment that consumers in debt could dish out to debt collection agencies that violated their rights. The maximum fine against violators under the Fair Debt Collection Practices Act is $1,000 per violation. At most, a collector could get slapped in court with a maximum $2,500 fine provided there was also a telecommunications violation under the Telephone Consumer Protection Act (TCPA). But, the new sheriff is a big game changer. They can sanction rogue debt collectors with civil penalties ranging from $5,000 to as much as a WHOPPING $1 million dollars per day PER VIOLATION.

Plus now, every single state attorney general has authority to seek civil penalties against debt collectors in federal or state court for violations of the Consumer Financial Protection Act and Consumer Financial Protection Bureau regulations. This essentially means that just in fines, debt collection agencies that don't have their house in order are bound to get shut down.


• Using a free Android phone recording app will help you get even by documenting the violators.

• Hire a debt settlements professional and get on the driver's seat with some worthy settlements.

• If you suspect your consumer rights were violated by a collection agency, report the violators by calling the CFPB at (855) 411-CFPB (2372) or the Federal Trade Commission at 1-877-FTC-HELP (1-877-382-4357).

• You can also call Debt Free League at 1-800-213-9968 for some great tips.

Vic Chevalier is an author who empowers people and small business owners to achieve financial prosperity. His literature at and financial blogs offers invaluable debt relief and credit restoration tips.

Source: EzineArticles
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