Congresswoman Mia Love is taking a stand for consumers by closing a loophole that allows abusive practices by debt collectors hired by federal agencies.
Some companies in the debt collection industry have argued that debts to government entities do not qualify as “consumer debts.” This bill clarifies that government-hired debt collectors are subject to the same rules as debt collectors collecting on private debt.
“Consumers deserve protection from bullying scare tactics from government-hired debt collectors,” Rep. Love said. “This is also about fairness by putting government-hired debt collectors on a level playing field with private debt collectors.”
Congresswoman Love worked closely on this bill with Sen. Cory Booker, D-New Jersey, sponsor of a similar bill in the United States Senate, and cosponsored by Utah Senator Mike Lee. The bill also has bipartisan support in the House, and was introduced with Rep. Emanuel Cleaver, D-Missouri, Rep. Keith Ellison, D-Minnesota, and Rep. French Hill, R-Arkansas.
The Stop Debt Collection Abuse Act of 2016 promotes fairness and strengthens protections for ordinary consumers against predatory practices.
The bill makes clear that:
- FDCPA protections will apply to overly aggressive debt collection practices from debt collection agents hired by the federal government.
- Overpayment, fines, penalties, and fees owed by private individuals to federal government entities will fall under the federal protections of the Fair Debt Collection Practices Act.
- Prevents private debt collectors from charging exorbitant and unfair fees when collecting on federal debt.
- Debt collectors are prevented from taking aggressive action unnecessarily quickly after a debt has allegedly gone unpaid.