THE CFPB INHERITS REGULATION F

The Fair Debt Collection Practices Act (FDCPA) was enacted to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent state action to protect consumers against debt collection abuses. Prior to July 21, 2011, the FDCPA provided that the Federal Trade Commission (Commission) must by regulation exempt from the FDCPA requirements any class of debt collection practices within any state if the Commission determines that under the law of that state that class of debt collection practices is subject to requirements substantially similar to those imposed by the FDCPA, and that there is adequate provision for enforcement. Historically, procedures that states may use to apply for this exemption have been implemented by the Commission in 16 CFR Part 901. Under the FDCPA, the Commission did not have general authority to promulgate trade regulations or other regulations with respect to the collection of debts by debt collectors as defined in the FDCPA.

The interim final rule substantially duplicates the Commission’s rule related to state exemptions under the FDCPA as the Bureau’s new Regulation F, 12 CFR Part 1006, making only certain non-substantive, technical, formatting, and stylistic changes. Subpart A of Regulation F contains the rule related to state exemptions under the FDCPA. Subpart B is reserved for any future rulemaking by the Bureau under the FDCPA. To minimize any potential confusion, other than republishing the Commission’s rule in 16 CFR Part 901 with the Bureau’s part number, the Bureau is preserving where possible the numbering the Commission used in 16 CFR Part 901. Additionally, while this interim final rule generally incorporates the Commission’s existing regulatory text, the rule has been edited as necessary to reflect nomenclature and other technical amendments required by the Dodd-Frank Act. Notably, this interim final rule does not impose any new substantive obligations on regulated entities.

Footnotes 1 and 2 in the Commission’s rule (16 CFR 901.2) that provide guidance on the meaning of “state law” and “class of debt collection practices” respectively were moved to a newly-created subsection for definitions in § 1006.1. Footnote 3 in the Commission’s rule (16 CFR 901.4) was moved to newly-created paragraph (a)(2) in § 1006.4, and other text in that section was renumbered accordingly. In § 1006.5, an address in the Commission’s rule (16 CFR 901.5) is replaced with an address for the Bureau, indicating where interested parties may go to review applications submitted by states for exemptions from the FDCPA. In addition, the Commission’s rule (16 CFR 901.6) indicated that the Commission would inform the appropriate official of any state that receives such an exemption of any subsequent amendments of the FDCPA (including the Commission’s formal advisory opinions, and informal staff interpretations issued by an authorized official or employee of the Commission). In § 1006.6, the Bureau indicates that it will inform the appropriate official of any state that receives such an exemption of any subsequent amendments to the FDCPA or Regulation F. The Bureau anticipates that it will adopt any additional guidance on the FDCPA as part of Regulation F, instead of through formal advisory opinions or informal staff interpretations. In addition, references to the Commission and its administrative structure have been replaced with references to the Bureau. Conforming edits have been made to internal cross-references. Conforming edits have also been made to reflect the scope of the Bureau’s authority pursuant to the FDCPA, as amended by the Dodd-Frank Act.

A copy of revised Regulation F is located at: https://www.jackscomplianceresource.com/CFPB-Reg-F-Fair-Debt-Collection-Practices-Act.html The Federal Register copy is available at: https://www.jackscomplianceresource.com/CFPB-The-Inherited-Regulations.html

Leave a Reply

Your email address will not be published. Required fields are marked *