H.R. 2547 — what changed
Comprehensive Debt Collection Improvement Act
From Introduced in House to Reported in House. 5 sections amended between Introduced in House and Reported in House.
Sec. 102 Obligor transactions
In general— Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is amended by adding at the end the following:
“140B. Unfair credit practices
changed “(a) In general—In connection with the extension of credit or creation of debt in or affecting commerce, as defined in section 4 of the Federal Trade Commission Act (15 U.S.C. 44), including any advance of funds or sale or assignment of future income or receivables that may or may not be credit, no person may directly or indirectly take or receive from another person or seek to enforce an obligation that constitutes or contains a cognovit or confession of judgment (for purposes other than executory process in the State of Louisiana), warrant of attorney, or other waiver of the right to notice and the opportunity to be heard in the event of suit or process thereon.
changed
“(b) Exemption—The exemption exemptions described in section 104(1) 104 shall not apply to this section.”
Technical and conforming amendments—
changed
Section 130(a) 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended by striking “creditor” each place adding at the term appears and inserting “person”.end the following:
added “(m) Creditor—In this section, the term “creditor” refers to any person charged with compliance that is not the obligor.”
The table of sections in chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is amended by adding at the end the following:
Sec. 404 Requirements for furnishers of medical debt information
changed
Additional notice requirements for medical debt— Section 623 of the Fair Credit Reporting Act (15 U.S.C. 1681s–2) 1681s-2) is amended by adding at the end the following:
“(f) Additional notice requirements for medical debt—Before furnishing information regarding a medical debt of a consumer to a consumer reporting agency, the person furnishing the information shall send a statement to the consumer that includes the following:
“(1) A notification that the medical debt—
“(A) may not be included on a consumer report made by a consumer reporting agency until the later of the date that is 365 days after—
“(i) the date on which the person sends the statement;
“(ii) with respect to the medical debt of a borrower demonstrating hardship, a date determined by the Director of the Bureau; or
“(iii) the date described under section 605(a)(10); and
“(B) may not ever be included on a consumer report made by a consumer reporting agency, if the medical debt arises from a medically necessary procedure.
“(2) A notification that, if the debt is settled or paid by the consumer or an insurance company before the end of the period described under paragraph (1)(A), the debt may not be reported to a consumer reporting agency.
“(3) A notification that the consumer may—
“(A) communicate with an insurance company to determine coverage for the debt; or
“(B) apply for financial assistance.”
changed
Furnishing of medical debt information— Section 623 of the Fair Credit Reporting Act (15 U.S.C. 1681s–2), 1681s-2), as amended by subsection (a), is further amended by adding at the end the following:
“(g) Furnishing of medical debt information
“(1) Prohibition on reporting debt related to medically necessary procedures—No person shall furnish any information to a consumer reporting agency regarding a debt arising from a medically necessary procedure.
“(2) Treatment of other medical debt information—With respect to a medical debt not described under paragraph (1), no person shall furnish any information to a consumer reporting agency regarding such debt before the end of the 365-day period beginning on the later of—
“(A) the date on which the person sends the statement described under subsection (f) to the consumer;
“(B) with respect to the medical debt of a borrower demonstrating hardship, a date determined by the Director of the Bureau; or
“(C) the date described in section 605(a)(10).
“(3) Treatment of settled or paid medical debt—With respect to a medical debt not described under paragraph (1), no person shall furnish any information to a consumer reporting agency regarding such debt if the debt is settled or paid by the consumer or an insurance company before the end of the 365-day period described under paragraph (2).
“(4) Borrower demonstrating hardship defined—In this subsection, and with respect to a medical debt, the term borrower demonstrating hardship means a borrower or a class of borrowers who, as determined by the Director of the Bureau, is facing or has experienced extenuating life circumstances or events that result in severe financial or personal barriers such that the borrower or class of borrowers does not have the capacity to repay the medical debt.”
Sec. 502 Consumer protections relating to debt collection practices
Reports on debt collection complaints and enforcement actions—
Semi-annual report— Section 1016(c) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5496(c)) is amended—
in paragraph (8), by striking “and” at the end;
in paragraph (9), by striking the period at the end and inserting a semicolon; and
by adding at the end the following:
“(10) an analysis of the consumer complaints received by the Bureau with respect to debt collection, including a State-by-State breakdown of such complaints; and
“(11) a list of enforcement actions taken against debt collectors during the preceding year.”
Annual report— Section 815(a) of the Fair Debt Collection Practices Act (15 U.S.C. 1692m(a)) is amended by adding at the end the following new sentence: “Each such report shall also include an analysis of the impact of electronic communications by debt collectors on consumer experiences with debt collection, including a consideration of consumer complaints about the use of electronic communications in debt collection.”.
Limitation on debt collection rules— Section 1022 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5512) is amended by adding at the end the following:
“(e) Limitation on debt collection rules—The Director may not issue any rule with respect to debt collection that allows a debt collector to send unlimited email and text messages to a consumer.”
Protection of consumers from unlimited texts and emails used in debt collection— Section 806 of the Fair Debt Collection Practices Act (15 U.S.C. 1692d) is amended by adding at the end the following new paragraph:
“(7) Contacting the consumer electronically (including by email or text message) without consent of the consumer to communicate via that method, after such consent has been withdrawn, or more frequently than the consumer consents to be contacted.”
Ensuring consumers receive notice of debt collection protections— Section 809(a) of the Fair Debt Collection Practices Act (15 U.S.C. 1692g(a)) is amended in the matter preceding paragraph (1)—
changed
by striking “Within five days” and all that follows through “debt,” “any debt,” and inserting the following: “Notice of debt; contents.—Within five days after the initial communication with a consumer in connection with the collection of any debt,”; and
by striking “, unless the following information is contained in the initial communication or the consumer has paid the debt,”.
Improved limitations on debt collection rules— Section 814(d) of the Fair Debt Collection Practices Act (15 U.S.C. 1692l(d)) is amended by adding at the end the following:
“(1) may not allow a debt collector to send unlimited electronic communications to a consumer;
“(2) shall require debt collectors to obtain consent directly from consumers before contacting them using a method other than by postal mail or by phone;
“(3) may not waive the requirements of the Electronic Signatures in Global and National Commerce Act (15 U.S.C. 7001 et seq.); and
“(4) shall allow consumers to opt out of any method of communication that the debt collector uses to communicate with consumers, including a method for which such consumer had given prior consent.”
Sec. 602 Definitions
Section 803 of the Fair Debt Collection Practices Act (15 U.S.C. 1692a) is amended—
in paragraph (4), by striking “facilitating collection of such debt for another” and inserting “collection of such debt”;
by amending paragraph (5) to read as follows:
“(5) The term debt means any obligation or alleged obligation of a consumer—
“(A) to pay money arising out of a transaction in which the money, property, insurance or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment;
“(B) to pay a loan, overpayment, fine, penalty, restitution, fee, or other money currently or originally owed to or guaranteed by a Federal or State government, including any courts or agencies; or
“(C) which is secured by real or personal property that is used or was obtained primarily for personal, family, or household purposes, where such property is subject to forfeiture or repossession upon nonpayment of the obligation or alleged obligation.”
in paragraph (6)—
by redesignating subparagraphs (A) through (F) as clauses (i) through (vi), respectively;
in clause (iii), as so redesignated, by inserting “(not including an independent contractor)” after “any State”;
by amending clause (vi), as so redesignated, to read as follows:
“(vi) any person collecting or attempting to collect any debt owed or due or asserted to be owed or due another to the extent such activity—
“(I) is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement;
“(II) concerns a debt which was originated by such person;
“(III) concerns a debt which was not in default at the time it was obtained by such person; or
“(IV) concerns a debt obtained by such person as a secured party in a commercial credit transaction involving the creditor.”
changed
by striking the paragraph designation and the first and second sentences and inserting the following:
“(6)
“(A) The term debt collector means—
“(i) any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts;
“(ii) any person who regularly collects or attempts to collect, directly or indirectly, by the person’s own means or by hiring another debt collector, debts owed or due or asserted to be owed or due another or that have been obtained by assignment or transfer from another;
“(iii) any person who regularly collects debts currently or originally owed or allegedly owed to a Federal or State agency or court; or
“(iv) notwithstanding subparagraph (B)(vi), any creditor who in the process of collecting debts of such creditor, uses another name that would indicate that a third person is collecting or attempting to collect such debts.”
changed
in the fourth sentence, by striking “The term does not” not include” and inserting the following:
changed
“(B) The term does not”not include”
Sec. 702 Award of damages
Additional damages indexed for inflation—
In general— Section 813 of the Fair Debt Collection Practices Act (15 U.S.C. 1692k) is amended—
in subsection (a)(2)—
changed
in subparagraph (A), by striking “; or” and inserting the following: “with respect to any one action taken by a debt collector in violation of this subchapter; or”; andor”;
changed
in subparagraph (B)(ii), by striking “or 1 per centum of the net worth of the debt collector; and” and inserting the following: “or 5 percent of the gross annual revenue of the debt collector: collector; and”;
in subsection (b), by inserting “the maximum amount of statutory damages at the time of noncompliance,” before “the frequency” each place it appears; and
by adding at the end the following:
“(f) Adjustment for inflation
“(1) Initial adjustment—Not later than 90 days after the date of the enactment of this subsection, the Bureau shall provide a percentage increase (rounded to the nearest multiple of $100 or $1,000, as applicable) in the amounts set forth in this section equal to the percentage by which—
“(A) the Consumer Price Index for All Urban Consumers (all items, United States city average) for the 12-month period ending on the June 30 preceding the date on which the percentage increase is provided, exceeds
“(B) the Consumer Price Index for the 12-month period preceding January 1, 1978.
“(2) Annual adjustments—With respect to any fiscal year beginning after the date of the increase provided under paragraph (1), the Bureau shall provide a percentage increase (rounded to the nearest multiple of $100 or $1,000, as applicable) in the amounts set forth in this section equal to the percentage by which—
“(A) the Consumer Price Index for All Urban Consumers (all items, United States city average) for the 12-month period ending on the June 30 preceding the beginning of the fiscal year for which the increase is made, exceeds
“(B) the Consumer Price Index for the 12-month period preceding the 12-month period described in subparagraph (A).”
Applicability— The increases made under section 813(f) of the Fair Debt Collection Practices Act, as added by paragraph (1)(C) of this subsection, shall apply with respect to failures to comply with a provision of such Act (15 U.S.C. 1601 et seq.) occurring on or after the date of enactment of this section.
Injunctive relief— Section 813(d) of the Fair Debt Collection Practices Act (15 U.S.C. 1692k(d)) is amended by adding at the end the following: “In a civil action alleging a violation of this title, the court may award appropriate relief, including injunctive relief.”.