FTC Releases Annual FDCPA Report to Congress

The Federal Trade Commission said Monday that it has released to the U.S. Congress an annual report of its enforcement actions and other efforts to rein in debt collectors under the Fair Debt Collection Practices Act (FDCPA). The FTC currently has federal jurisdiction over debt collectors and administers the FDCPA.

In announcing the report, the FTC noted at the top of the release the increase in consumer complaints the agency compiled against debt collectors. The FTC separately released consumer complaint statistics less than a month ago.

ACA International, the association of credit and collection professionals, Monday issued a rebuttal of the FTC’s complaints data. Ted Smith, ACA’s interim CEO, said in a release, “While we appreciate that the FTC is trying to track this data, the FTC’s complaint methodology paints an interesting but incomplete and inaccurate portrait of consumer complaints against the third-party collection industry.”

The group noted that the FTC’s complaint data included both inquiries and complaints. ACA said that because of this, there is no way of knowing if a consumer was contacting the FTC with a legitimate complaint or simply a question about a company and its practices. ACA also said that the FTC does not share consumer contact information with accounts receivable management firms, meaning that a collection agency cannot even attempt to resolve the complaint.

But the FTC’s report, available in full at http://ftc.gov/os/2011/03/110321fairdebtcollectreport.pdf, does detail enforcement actions the agency took in 2010.

Although covering 2010, the report’s enforcement section starts with the recent announcement of a $2.8 million settlement with West Asset Management. The report also detailed two other investigations with resolution: one involving a group of companies comprised of Internet payday lenders and their collection agency, and the other being a $1.75 million settlement with Allied Interstate. The FTC noted that it is currently “conducting numerous non-public investigations of debt collectors to determine whether they have engaged in violations of the FDCPA or the FTC Act.”

The FTC also detailed its policy research and recommendations for 2010. The agency was very active on the policy front last year, examining, researching and in some cases making policy recommendations which included debt collection litigation and arbitration proceedings, the collection of decedents’ debts, the debt buying industry, and technological changes.

Under recently enacted financial reform laws, the new Consumer Financial Protection Bureau will have joint authority with the FTC over FDCPA enforcement and rulemaking. The CFPB will also be responsible for issuing the annual report on debt collection enforcement to Congress going forward.