This move by FTC is a sort of warning to other collection centers and auto lending companies to scrutinize their existing consumer behavior and modify it to acceptable levels. U.S. regulators have tightened their noose on provider-supplier nexus related to consumer finance. Lenders need to own up to the behavior of their suppliers because many times, government regulators are finding them guilty of leniency and charging them penalties.
Representatives from Expert Global Solutions used to call up their customers regularly, especially at work when they are too busy to receive calls. Even Consumer Financial Protection Bureau (CFPB) is now on the case and looking into the various practices involving debt collection. Richard Cordray, CFPB director is going to present a formal bulletin in the coming times that seeks to warn various debt collection agencies. In case of unlawful conduct, the bureau is going to hold companies coming under its jurisdiction accountable.
Any abusive, unfair, and deceptive practice is illegal, irrespective of the type of collection agency. The bulletin clarifies this clearly. The latest moves and clarification from CFPB are in keeping with the Obama administration’s emphasis on federal law enhancements for consumer protection.
The case of expert global is not an isolated incident. On 27th June CFPB directed U.S. bank with partner DFS to cough up $6.5 million and refund it to members of the military services. According to Consumer Financial Protection Bureau, the companies did not properly disclose fees for military loan installments as well as auto loan educational services program. They charged the participants, irrespective of such a disclosure. Thus, the companies are guilty of misrepresentation of true coverage and costs of products adjunct to their auto loans. Following this move from CFPB, US bank left the program for good.
In the coming times, CFPB is all set to compile debt collection, consumer complaints mostly those related to auto loans. ACA International related to collection and credit professionals are going to support the CFPB move. However, they believe that consumer complaint should not be the only basis for proving unlawful collection agency conduct.
