Earlier this week the Administrator of the Colorado Fair Debt Collection Practices Act (FDCPA) announced an upcoming meeting to discuss three things: collection practices trends and issues, potential rulemaking, and "other business -- opportunity to address the Administrator on issues of interest and concern."
As insideARM reported in June of 2017, Colorado recently conducted a sunset review of its FDCPA. As a result of the review, these changes were made:
- Continuing the Act through 2028;
- Defining a 'debt buyer' as a person who engages in the business of purchasing debt for collection purposes;
- Creating requirements for debt collectors and collection agencies that bring legal actions on debts owned;
- Defining what is expected of a collection agency that purchases, sells, or attempts to collect on a purchased debt;
- Clarifying that the statute of limitations for private actions and actions by the administrator of the Act is 2 years;
- Repealing the collection agency board; and
- Requiring the administrator of the 'Uniform Consumer Credit Code' to prepare a report concerning the Act.
The elimination of the collection agency board was one of the most controversial changes at the time. It was replaced with a requirement that the Administrator produce a biannual report. Read more about the details of that report here.
You can view a copy of the bill incorporating the updates here.
You can view a copy of the full Colorado FDCPA here.
The upcoming meeting will be held on Monday July 30, 2018 at 1:30pm and is for licensees, industry groups, client groups and other interested parties. It will take place in Room 1D of the Ralph L. Carr Colorado Judicial Center at 1300 Broadway, Denver, CO 80203.
For further information, visit the Collection Agency website at: www.coag.gov/car.
One aspect of the Colorado FDCPA that's been brought to my attention is that it requires collection agencies (even those located out-of-state) to have an office in the state where the consumer can walk-in payments. This, of course, creates an additional burden and expense for the debt collector; but also, it's of pretty limited benefit to consumers, as it's only useful to those who live in the immediate geographic area of the local office. It hardly makes sense to expect that a consumer who lives in the southwest corner of Colorado will drive seven hours to Denver to walk in a payment on a $200 debt. This office requirement may have made sense at one time, but not in the digital age when consumers are able to pay immediately from the comfort of their living room via the web or telephone.
The rules also require the local office address and telephone number be on all written communications. This is confusing because the consumer is instructed to mail payments or send correspondence to certain addresses, but then yet another address and telephone number must appear on the letter. It seems this deserves to be on the agenda.
Meanwhile, one must also view this meeting in the broader context of the philosophical changes going on at the federal Bureau of Consumer Financial Protection (BCFP, formerly CFPB). Those states that believe federal regulators are backing off their commitment to industry oversight have demonstrated that they intend to step into that role. As for debt collection, the BCFP continues to say that industry oversight and rulemaking are priorities.