On July 30, 2021 the Consumer Financial Protection Bureau announced that the two final rules (Regulation F) issued under the Fair Debt Collection Practices Act (FDCPA) will take effect as planned, on November 30, 2021. The CFPB issued a proposal in April 2021 that, if finalized, would have extended the effective dates to January 29, 2022. The CFPB has now determined that such an extension is unnecessary. Following this announcement, the CFPB will publish a formal notice in the Federal Register withdrawing the April 2021 proposal.
Regulation F applies to debt collectors. The rules apply directly to financial institutions if the institution is collecting a debt owed to a third party or is collecting its own debt, but is using a different name. Financial institutions also have vendor management issues that arise when using third-party collectors. Failure to follow the rule when collecting debt in any of these scenarios can result in violations of Regulation F, UDAAP, or both.
Policies, procedures and training must be completed and in place by November 30, 2021. To assist with preparations for the new rule, Compliance Resource is offering a webinar entitled Implementing the New Fair Debt Collection Practices Act and Regulation F on October 19, 2021.