CFPB Aims to Stop Debt Collectors From Contacting Borrowers at Work

The Consumer Financial Protection Bureau (CFPB) is working to prevent unlawful debt collection targeting consumers at their workplace.

The regulator said in a Thursday (Jan. 2) blog post that it continues to crack down on companies that harass consumers, pointing to actions it took in 2014 and 2018 against debt collectors that contacted borrowers or their employers at work.

“Unscrupulous companies may use aggressive tactics to collect debts, including contacting people in the workplace, which can be illegal,” CFPB General Counsel Seth Frotman and Supervision Director Lorelei Salas wrote in the post. “This can threaten your employment or put pressure on you to pay debts even if you don’t actually owe them.”

The CFPB also said that federal and state law enforcement officials should be on the lookout for companies that contact people at work to coerce them to pay debts. This includes law enforcement officials who enforce the Fair Debt Collection Practices Act (FDCPA) and other laws that prohibit unfair, deceptive or abusive practices.

“CFPB examiners recently found that one or more companies unfairly called peoples’ references and places of employment after people asked them to stop or abusively included language in their loan applications that suggested people had consented to workplace calls that were actually illegal,” Frotman and Salas wrote in the post.

In another effort to combat these practices, the CFPB encourages Congress to repeal a provision of the FDCPA that allows debt collectors to contact third parties to obtain “place of employment” and other “location information” — a provision that some courts have interpreted to mean that debt collectors can contact a borrower’s employer.

“In a world where so many people have cellphones, companies don’t often need to contact your employer to find you,” the authors wrote in the post. “In fact, companies may be calling you at work (or threatening to do so) when the real point is to embarrass, pressure or otherwise coerce you to pay.”

The CFPB said in September that it is taking steps to ensure debt collectors follow consumer financial protection laws after finding that some are using illegal tactics.

The regulator’s annual report on debt collection released at that time highlighted illegal practices in the collection of medical debt and rental debt.