CFPB has issued Notice of Proposed Rule.
DAKCS is excited to introduce attorney and industry advocate Joann Needleman as guest compliance thought leader. Joann brings experience and insight as a navigator and strategist to assist in the regulatory changes the debt collection industry is facing today.
Recently PDCflow interviewed Joann Needleman as she is making a difference in the Collection and ARM industry. The spotlight interview, Thriving in Third Party: An Interview with Joann Needleman tells more about Joann.
In the weeks ahead Joann will cover the CFPB Notice of Proposed Rule (NPR) in detail. She will also join the DAKCS community discussions as a resource on our Compliance Conversation article series and in our DAKCS LinkedIn user group as the NPR impact unfolds.
Now let’s get started.
The CFPB Issued the Notice of Proposed Rule … What Should You Do Next?
The Consumer Financial Protection Bureau (CFPB or Bureau) issued its Notice of Proposed Rule (NPR) on May 7, 2019. The NPR exceeds 500 pages which encompasses not only the proposed rule but comments and analysis by the CFPB to support their proposals.
The NPR should be currently viewed as a policy document; it is not a final rule or a final regulation. However, it is clear that the Bureau wants to put some guardrails around how debt collectors communicate with consumers while at the same time incorporate modern communication channels into the debt collection.
Additionally, the CFPB provided model notices and express directives around limited content messages. While the specifics of these proposals will not be determined for some time, now is the time to see whether your agency can adopt these new policies into your operations.
The following are some recommendations for what agencies should be doing now that the NPR has been released:
1. Designate an NPR Working Group.
Two or more people in your agency should be responsible for not only reading the NPR, but for fully understanding the proposals set forth. Hint: Re-organize the document by sections (i.e. § 1006.1, § 1006.2 etc. For each section, include the Rule, the Section-by-Section Analysis, and the Official Comment. This will be an easy way to digest and decode what is being set forth in these proposals.
2. Reporting out to your Agency.
The NPR Working Group should not only be the go-to people in the organization for any questions regarding the NPR, but they should be comparing the proposals of the NPR to the agency’s current infrastructure. Upon completion of that comparison, the NPR Working Group should report out their findings to management.
3. Do not Adopt the Proposals of the NPR into your Current Operations.
The NPR is only a proposal, nothing is finalized. However, the NPR should be a roadmap for future operations. If you have not thought about using electronic communications, maybe now is the time to start. Think about what training challenges your agency may have if your collectors were to use email and text when speaking with consumers. If you are using outside vendors for some of your operations, consider how their services could be impacted, especially if you are using a letter vendor.
4. Consider filing Comments.
While trade associations will file broader more expansive comments, all agencies and their employees should consider submitting targeted comments about the Rule. While not all aspects of the Rule will have a direct impact on your agency, everyone may file a comment. Comments can range from full support of the Rule to suggestions on how to improve the proposal. Maybe there is a proposal that is completely unworkable. Your NPR Working Group should be coordinating within your agency to determine what comments are appropriate.
The NPR should not be filed away after it has been read. If an agency does not consider the impact of the current proposal on present operations, it will be too late for you to do so once the NPR is finalized. The NPR represents an opportunity for all agencies to start an immediate assessment of their operations and to start planning for the future.
To aid in this discovery process DAKCS will take questions and comments via our Linkedin DAKCS Software Systems User Group. Make the request to join us today. You may also email email@example.com for a group invitation.