The provisions within HR 4550 sponsored by Representatives Gonzalez and Mooney would exempt attorneys from the Fair Debt Collection Practices Act and remove oversight of lawyers engaged in litigation from the Consumer Financial Protection Bureau. The legislation has not been marked up or voted on and it remains under consideration in the House Financial Services Committee.
The changes proposed by Representatives Gonzalez and Mooney under HR 4550 would remove many protections that consumers enjoy under the FDCPA. These changes would allow attorneys to proceed to trial without witnesses or solid evidence, make it easier to dismiss cases or proceed to judgment, and file cases in courts that may be located considerable distances from the consumer’s place of residence. The changes would also make it easier for attorneys to seek fees and costs that are not currently allowed, allow FDCPA attorneys to file lawsuits to recover time-barred debt beyond the statute of limitations and make it possible for attorneys to abuse state garnishment proceedings to pursue property that is otherwise exempt from collection proceedings.
Currently, the law and oversight by the Consumer Financial Protection Bureau (CFPB) provide protection against these types of actions. The proposed changes would remove the agency’s oversight over attorneys and place it in the hands of the state bar association as well as any equivalent agencies such as the Nevada Bureau of Consumer Protection (BCP). However, many states do not have the resources to effectively conduct this oversight and these changes would leave many consumers exposed to unscrupulous behavior and legal actions that could cause them serious financial harm.
The bill was referred to the House Financial Services Committee in early December 2017. It was scheduled for discussion earlier this month. However, it was not among more than a dozen bills that were marked up and sent to the full House in mid-January 2018. The committee stated that the reason for the bill’s exclusion stemmed from administrative issues that arose when legislators submitted proposed amendments to the bill and it remains under consideration within the committee.
The bill is currently scheduled to be marked-up in March. Those wishing to comment on the legislation should contact their representative’s DC office and voice their opinion.