[Federal Register Volume 86, Number 73 (Monday, April 19, 2021)]
[Proposed Rules]
[Pages 20334-20336]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-07505]


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BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Part 1006

[Docket No. CFPB-2021-0007]
RIN 3170-AA41


Debt Collection Practices (Regulation F); Delay of Effective Date

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Proposed rule; request for public comment.

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SUMMARY: In 2020, the Bureau of Consumer Financial Protection (Bureau) 
finalized two rules titled Debt Collection Practices (Regulation F). 
The rules revise Regulation F, which implements the Fair Debt 
Collection Practices Act (FDCPA). Both final rules have an effective 
date of November 30, 2021. The Bureau is proposing to extend that 
effective date by 60 days, until January 29, 2022.

DATES: Comments must be received on or before May 19, 2021.

ADDRESSES: You may submit comments, identified by Docket No. CFPB-2021-
0007 or RIN 3170-AA41, by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. Include Docket 
No. CFPB-2021-0007 or RIN 3170-AA41 in the subject line of the message.
     Mail/Hand Delivery/Courier: Comment Intake--Debt 
Collection Effective Date, Bureau of Consumer Financial Protection, 
1700 G Street NW, Washington, DC 20552.
    Instructions: The Bureau encourages the early submission of 
comments. All submissions should include the agency name and docket 
number or Regulatory Information Number (RIN) for this rulemaking. 
Because paper mail in the Washington, DC, area and at the Bureau is 
subject to delay, and in light of difficulties associated with mail and 
hand deliveries during the COVID-19 pandemic, commenters are encouraged 
to submit comments electronically. In general, all comments received 
will be posted without change to https://www.regulations.gov. In 
addition, once the Bureau's headquarters reopens, comments will be 
available for public inspection and copying at 1700 G Street NW, 
Washington, DC 20552, on official business days between the hours of 10 
a.m. and 5 p.m. Eastern Time. You can make an appointment to inspect 
the documents by telephoning 202-435-7275.
    All comments, including attachments and other supporting materials, 
will become part of the public record and subject to public disclosure. 
Proprietary information or sensitive personal information, such as 
account numbers or Social Security numbers, or names of other 
individuals, should not be included. Comments will not be edited to 
remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT: Seth Caffrey, Courtney Jean, or 
Kristin McPartland, Senior Counsels, Office of Regulations, at 202-435-
7700. If you require this document in an alternative electronic format, 
please contact [email protected].

SUPPLEMENTARY INFORMATION:

I. Summary of the Proposed Rule

    In October and December 2020, the Bureau released final rules to 
revise Regulation F, 12 CFR part 1006, which implements the FDCPA 
(together, the Debt Collection Final Rules). The Debt Collection Final 
Rules prescribe Federal rules governing the activities of debt 
collectors, as that term is defined in the FDCPA, and have an effective 
date of November 30, 2021.\1\ In light of the ongoing societal 
disruption caused by the global COVID-19 pandemic, the Bureau is 
proposing to extend that effective date. To afford stakeholders 
additional time to review and, if applicable, to implement the Debt 
Collection Final Rules, the Bureau is proposing to extend the effective 
date by 60 days, to January 29, 2022. This proposal requests comment on 
whether the Bureau should extend the effective date of the Debt 
Collection Final Rules, and if so, whether 60 days is an appropriate 
length of time for such an extension.
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    \1\ 85 FR 76734 (Nov. 30, 2020); 86 FR 5766 (Jan. 19, 2021).
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II. Background

A. The Debt Collection Final Rules

    The first debt collection final rule, released on October 30, 2020, 
addresses, among other topics, communications in connection with debt 
collection and prohibitions on harassment or abuse, false or misleading 
representations, and unfair practices in debt collection. The first 
final rule also addresses the use of newer communication technologies 
in debt collection and establishes record retention requirements.
    The second debt collection final rule, released on December 18, 
2020, focuses on debt collection disclosures and addresses, among other 
topics, the information that debt collectors must provide consumers at 
the outset of collections communications. The second final rule also 
prohibits debt collectors from bringing or threatening to bring a legal 
action against a consumer to collect a time-barred debt and prohibits 
debt collectors from furnishing information about a debt to a consumer 
reporting agency before the debt collector takes certain actions to 
contact the consumer about the debt.

B. Proposed Effective Date

    The Debt Collection Final Rules have an effective date of November 
30, 2021, or one year after the first debt collection final rule was 
published in the Federal Register. In finalizing that effective date 
for both final rules, the Bureau concluded that all stakeholders would

[[Page 20335]]

benefit if both rules had the same effective date, and the Bureau 
determined that a one-year period from the publication date of the 
first final rule would provide debt collectors sufficient time to 
implement the provisions of both rules.\2\
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    \2\ 85 FR 76734, 76863 (Nov. 30, 2020); 86 FR 5766, 5838 (Jan. 
19, 2021).
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    Since the Debt Collection Final Rules were published, the global 
COVID-19 pandemic has continued to cause widespread societal 
disruption, with effects extending into 2021. In light of that 
disruption, the Bureau believes that providing additional time for 
stakeholders to review and, if applicable, to implement the final rules 
may be warranted. The Bureau believes that extending the rules' 
effective date by 60 days, to January 29, 2022, may provide 
stakeholders with sufficient time for review and implementation. The 
Bureau requests comment on whether to extend the final rules' effective 
date and, if so, whether 60 days is the appropriate amount of time for 
an extension.
    As noted in the Debt Collection Final Rules, debt collectors could 
choose to comply with the rules' requirements and prohibitions before 
the effective date. Until the effective date, however, the FDCPA and 
other applicable law would continue to govern the conduct of FDCPA debt 
collectors. Similarly, to the extent that the Debt Collection Final 
Rules establish a safe harbor from liability for certain conduct, or a 
presumption that certain conduct complies with or violates the rules, 
those safe harbors and presumptions will not take effect until the 
effective date. The Bureau requests comment on whether it would 
facilitate implementation to retain the November 30, 2021 effective 
date for some or all of the safe harbors identified in the Debt 
Collection Final Rules. The Bureau requests comment on, for example, 
the costs and benefits of permitting debt collectors to obtain a safe 
harbor for using the Bureau's model validation notice \3\ as of 
November 30, 2021, even if the Debt Collection Final Rules do not 
otherwise take effect until January 29, 2022.
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    \3\ 86 FR 5766, 5857 (Jan. 19, 2021).
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III. Legal Authority

    To extend the effective date of the Debt Collection Final Rules, 
the Bureau is proposing to exercise its rulemaking authority pursuant 
to FDCPA section 814(d) and Dodd-Frank Act sections 1022(b)(1) and 
1032(a).
    The legal authority for the Debt Collection Final Rules is 
described in detail in those final rules.\4\ As amended by the Dodd-
Frank Act, FDCPA section 814(d) authorizes the Bureau to ``prescribe 
rules with respect to the collection of debts by debt collectors,'' as 
defined in the FDCPA.\5\ Section 1032(a) of the Dodd-Frank Act provides 
that the Bureau may prescribe rules to ensure that the features of any 
consumer financial product or service, both initially and over the term 
of the product or service, are fully, accurately, and effectively 
disclosed to consumers in a manner that permits consumers to understand 
the costs, benefits, and risks associated with the product or service, 
in light of the facts and circumstances.\6\ Additionally, under Dodd-
Frank Act section 1022(b)(1), the Bureau has general authority to 
prescribe rules as may be necessary or appropriate to enable the Bureau 
to administer and carry out the purposes and objectives of the Federal 
consumer financial laws, and to prevent evasions thereof.\7\ The FDCPA 
and title X of the Dodd-Frank Act are Federal consumer financial 
laws.\8\ Accordingly, in proposing this rule, the Bureau is exercising 
its authority under Dodd-Frank Act section 1022(b) \9\ to prescribe 
rules under the FDCPA and title X of the Dodd-Frank Act that carry out 
the purposes and objectives and prevent evasion of those laws. Section 
1022(b)(2) of the Dodd-Frank Act \10\ prescribes certain standards for 
rulemaking that the Bureau must follow in exercising its authority 
under section 1022(b)(1).
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    \4\ 85 FR 76734, 76739-41 (Nov. 30, 2020); 86 FR 5766, 5770-71 
(Jan. 19, 2021).
    \5\ 15 U.S.C. 1692l(d).
    \6\ 12 U.S.C. 5532(a).
    \7\ 12 U.S.C. 5512(b)(1).
    \8\ 12 U.S.C. 5481(14).
    \9\ 12 U.S.C. 5512(b).
    \10\ 12 U.S.C. 5512(b)(2).
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IV. Dodd-Frank Act Section 1022(b) Analysis

    In developing the proposed rule, the Bureau has considered the 
potential benefits, costs and impacts required by section 1022(b)(2) of 
the Dodd-Frank Act. Specifically, section 1022(b)(2) calls for the 
Bureau to consider the potential benefits and costs of a regulation to 
consumers and covered persons, including the potential reduction of 
consumer access to consumer financial products or services, the impact 
on depository institutions and credit unions with $10 billion or less 
in total assets as described in section 1026 of the Dodd-Frank Act, and 
the impact on consumers in rural areas. In addition, Dodd-Frank Act 
section 1022(b)(2)(B) \11\ directs the Bureau to consult, before and 
during the rulemaking, with appropriate prudential regulators or other 
Federal agencies, regarding consistency with the objectives those 
agencies administer. In developing the proposed rule, the Bureau has 
consulted, or offered to consult with, the appropriate prudential 
regulators and other Federal agencies, including regarding consistency 
with any prudential, market, or systemic objectives administered by 
such agencies.
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    \11\ 12 U.S.C. 5512(b)(2)(B).
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    The Bureau previously considered the costs, benefits, and impacts 
of the Debt Collection Final Rules' major provisions.\12\ Compared to 
the baseline established by the rules,\13\ the proposed extension of 
the rules' effective date would generally benefit covered persons by 
facilitating initial compliance with the rules' requirements and 
delaying the start of ongoing compliance costs. Because covered persons 
retain the option of complying with the rules before the effective 
date, any extension should not increase costs to covered persons 
because they retain the option of complying by the original effective 
date. The Bureau believes that extending the effective date may also 
delay consumers' realization of benefits arising from the protections 
provided by the rules, although given the short length of the delay, 
any overall reduction in benefits should be small. In addition, the 
Bureau does not expect the proposed rule to have a differential impact 
on depository institutions and credit unions with $10 billion or less 
in total assets as described in section 1026 of the Dodd-Frank Act or 
on consumers in rural areas. The Bureau does not believe that the 
proposed effective date extension would reduce consumer access to 
consumer financial products and services, as the evidence discussed in 
the Debt Collection Final Rules indicates that the rules themselves 
will have limited negative impact on access to credit.\14\
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    \12\ 81 FR 83934, 84269 (Nov. 22, 2016).
    \13\ The Bureau has discretion in any rulemaking to choose an 
appropriate scope of analysis with respect to potential benefits, 
costs, and impacts and an appropriate baseline.
    \14\ See 85 FR 76734, 76879-81 (Nov. 30, 2020); 86 FR 5766, 5849 
(Jan. 19, 2021).
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    The Bureau requests comment on this discussion as well as 
submission of additional information that could inform the Bureau's 
consideration of the potential benefits, costs, and impacts of this 
proposed rule.

[[Page 20336]]

V. Initial Regulatory Flexibility Act Analysis

    The Regulatory Flexibility Act (RFA),\15\ as amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996,\16\ requires each 
agency to consider the potential impact of its regulations on small 
entities, including small businesses, small governmental units, and 
small not-for-profit organizations. The RFA defines a ``small 
business'' as a business that meets the size standard developed by the 
Small Business Administration pursuant to the Small Business Act.\17\
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    \15\ 5 U.S.C. 601 et seq.
    \16\ Public Law 104-121, tit. II, 110 Stat. 857 (1996).
    \17\ 5 U.S.C. 601(3) (the Bureau may establish an alternative 
definition after consultation with the Small Business Administration 
and an opportunity for public comment).
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    The RFA generally requires an agency to conduct an initial 
regulatory flexibility analysis (IRFA) and a final regulatory 
flexibility analysis (FRFA) of any rule subject to notice-and-comment 
rulemaking requirements, unless the agency certifies that the rule 
would not have a significant economic impact on a substantial number of 
small entities.\18\ The Bureau also is subject to certain additional 
procedures under the RFA involving the convening of a panel to consult 
with small business representatives prior to proposing a rule for which 
an IRFA is required.\19\
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    \18\ 5 U.S.C. 603-605.
    \19\ 5 U.S.C. 609.
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    An IRFA is not required for this proposed rule because the proposed 
rule, if adopted, would not have a significant economic impact on a 
substantial number of small entities. As discussed in part II, because 
covered persons would retain the option of complying by the Debt 
Collection Final Rules' original November 30, 2021 effective date, any 
extension of the effective date would not increase costs to covered 
persons. Thus, the Bureau anticipates that the proposed rule would only 
reduce burden on small entities relative to the baseline.
    Accordingly, the Acting Director certifies that this proposed rule, 
if adopted, would not have a significant economic impact on a 
substantial number of small entities. The Bureau requests comment on 
its analysis of the impact of the proposed rule on small entities and 
requests any relevant data.

VI. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (PRA),\20\ Federal 
agencies are generally required to seek, prior to implementation, 
approval from the Office of Management and Budget (OMB) for information 
collection requirements. The collections of information related to the 
Debt Collection Final Rules is under review by OMB in accordance with 
the PRA and under OMB Control Number 3170-0056. Under the PRA, the 
Bureau may not conduct or sponsor, and, notwithstanding any other 
provision of law, a person is not required to respond to, an 
information collection unless the information collection displays a 
valid control number assigned by OMB.
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    \20\ 44 U.S.C. 3501 et seq.
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    The Bureau has determined that this proposed rule would not have 
any new or revised information collection requirements (recordkeeping, 
reporting, or disclosure requirements) on covered entities or members 
of the public that would constitute collections of information 
requiring OMB approval under the PRA. The Bureau welcomes comments on 
these determinations or any other aspect of the proposal for purposes 
of the PRA.

VII. Signing Authority

    The Acting Director of the Bureau, David Uejio, having reviewed and 
approved this document, is delegating the authority to electronically 
sign this document to Grace Feola, a Bureau Federal Register Liaison, 
for purposes of publication in the Federal Register.

    Dated: April 7, 2021.
Grace Feola,
Federal Register Liaison, Bureau of Consumer Financial Protection.
[FR Doc. 2021-07505 Filed 4-16-21; 8:45 am]
BILLING CODE 4810-AM-P