Debt collection December 2020 final rule

On December 18, the Consumer Financial Protection Bureau (CFPB) issued a second debt collection final rule. The first debt collection final rule was published in the Federal Register in November. The NAFCU compliance team blogged twice about the first final rule earlier this year. The blogs covered what constitutes a communication and a limited-content message under the rule. They also provided some background about the final rule (e.g., in general the rulemaking applied to third-party debt collectors rather than credit unions collecting their own debts). NAFCU also issued a final regulationthat addressed the first rulemaking in more detail than the two blogs. The blogs and the final regulation explained the scope and coverage of the Fair Debt Collection Practices Act (FDCPA) and the debt collection final rules and why credit unions, even though they may not be FDCPA debt collectors, may need to know how these rules work.

The final rule does four main things. It explains that deceased persons are covered consumers under Regulation F. It also addresses time-barred debt, passive collections, and debt validation notices.

Deceased Persons are Consumers

The rule clarifies that the definition of a consumer under Regulation F includes deceased individuals. This effectively extends the protections set forth in Regulation F to individuals authorized to act on behalf of a deceased consumer’s estate. For example, the CFPB noted that an executor, administrator, or personal representative would be a consumer for the purposes of the debt validation notice rule. The CFPB also explained that the prohibition in section 1006.22(f)(4) against communicating or attempting to communicate with a person in connection with the collection of a debt by social media if it can be viewed by the public or the person’s contacts applies to deceased persons.


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