NYC Report Proposes Requiring Debt Collectors to Provide Better Services for Consumers with Limited English Proficiency

Today, the New York City Department of Consumer and Worker Protection (DCWP) announced the release of a report titled, "Lost in Translation: Findings from Examination of Language Access by Debt Collectors." The report examined several NYC-licensed debt collection agencies to see how they service consumers with limited English proficiency (LEP). DCWP notes that the findings were concerning and proposes solutions that would require licensed debt collection agencies to provide better services to LEP consumers.

The report found that of the thirty-two debt collection agencies investigated, all claimed to provide some form of access to non-English speaking consumers, but that "those services were often limited and lacked quality." Thirty-one of the agencies provided LEP services that were delayed (e.g., having to wait several minutes to be connected to a Spanish-speaking representative) or not provided at all (e.g., transferring the consumer to a voicemail consisting only of English instructions). Fourteen of the agencies failed to record the consumer's language preference, and ten of the agencies failed to maintain policies and procedures about how to work with LEP consumers.

The report also notes that of the 517 NYC-licensed debt collectors that contact consumers directly:

• 46% reported they contact consumers in a language other than English.
• 20% reported they provide collection letters (including disclosures) in a language other than English.
• 41% reported that they are staffed with multilingual customer representatives.
• 9% provide general translation services to consumers.

According to the announcements:

These findings show that without a legal obligation to serve LEP consumers, the majority of licensed debt collection agencies will not offer language assistance services to consumers to ensure they can understand the collection process. Based on these findings, the report proposes new debt collection laws and regulations that would require collectors provide certain notices and materials to consumers who request them in their preferred language.

The proposals include requiring debt collectors to request and maintain language preferences of consumers, require that a validation notice be sent in the consumer's preferred language prior to collecting the debt, requiring collectors to provide a glossary of commonly-used terms in the consumer's preferred language, and prohibiting inaccurate or incomplete translations.

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insideARM Perspective

The premise of this report—that debt collectors should communicate in a way that is understandable to the consumer—is supported by industry and consumer advocates alike. However, there is one glaring gap in this analysis: the disconnect between the creditor, consumer, and debt collector. Creditors that offer non-English services usually require their debt collectors to provide similar accommodations. If it is argued that LEP consumers are not equipped to understand collection notices, even with the non-English services already provided, then could it not also be argued that the consumer did not understand the original credit agreement and its implications?