CFPB survey: ‘troubling problems’ in debt collection industry

Jan. 12, 2017 -- More than one in four consumers contacted by debt collectors feel threatened – and three in four of consumers report that debt collectors do not honor their request that collectors leave them alone, according to a new report from the CFPB, released early today.

The report is based on a consumer bureau national survey (which the agency said is the first of its kind), and provides an “in-depth analysis of consumers’ encounters with the debt collection industry.” According to CFPB, the survey is part of an ongoing agency effort to explore industry practices and consumer experiences with debt collectors.

“The Bureau today casts light on troubling problems in the debt collection industry,” said CFPB Director Rich Cordray in a statement. “. The Bureau is working to clean up abuses in this industry, and to see that all consumers are treated with fairness, decency, and respect.”

Results of the survey show, CFPB stated, that about one-third of consumers – or more than 70 million Americans – were contacted by a creditor or debt collector about a debt in the previous 12 months. They were most often contacted about medical and credit card debt. Additional highlights of the survey included:

  • More than one-in-four consumers (27%) report threatening contact;
  • More than half (53%) of consumers report incorrect contact for at least one debt;
  • More than one-third of consumers (36%) report being contacted at inconvenient times;
  • Nearly two in five (37%) of consumers report that a debt collector attempted contact four or more times per week;
  • One-in-seven consumers (15%) contacted about a debt report being sued.

Also today, the bureau released a white paper on risks in the online debt sales market, which highlights potential risks to consumers’ personal information posed by debt sales online. “Many debts sold in online marketplaces come with sensitive personal information attached, and are easily available at extremely low prices,” the bureau stated in a release. “The report raises questions about protections for that information and the dangers of it falling into the wrong hands.”

LINKS:

Consumer Experiences with Debt Collectors Report

Online Debt Sales Report