Cleaver's Bill to Protect Consumers From Predatory Debt Collection Practices Passes Unanimously Out of Committee

(Washington, D.C.) – Last night, H.R. 4403, the Stop Debt Collection Abuse Act of 2019, was passed out of the Financial Services Committee unanimously in a vote of 54 to 0. The legislation was introduced by United States Representative Emanuel Cleaver, II (D-MO) and would protect American consumers from predatory debt collection abuses by closing federal loopholes and bolstering consumer protections. Congressman French Hill (R-AK) was the Republican sponsor of the bill.

"I want to thank Congressman Hill for his willingness to work with me on something we can all agree on, and that's protecting American consumers," said Congressman Cleaver. "There is no justification for some of the harassment that Americans are forced to deal with from federally-hired debt collectors, and this bill will help to close the loopholes that have allowed that behavior to take place. I'm hopeful we can get a vote on the House floor with similar bipartisan support."

"If Congress is going to set up fair debt collection practices to hold the private sector accountable, a federal agency collecting a debt from consumers should be held to the same standard," said Congressman Hill. "This bipartisan legislation will protect Arkansas consumers by putting government-hired debt collectors on a level playing field with private debt collectors. Additionally, studying debt collection practices can help identify the right balance between protecting consumers and ensuring that access to credit is not restricted."

The Fair Debt Collection Practices Act (FDCPA) makes it illegal for debt collectors to use abusive, unfair, or deceptive practices when collecting debts from consumers. Unfortunately for American consumers, a major exception in the FDCPA are debt collectors hired by state or federal government entities. The Stop Debt Collection Abuse Act of 2019 aims to close that exemption by requiring federal agencies to be subject to the same high standards of the FDCPA, among other changes to existing federal law.

Specifically, the Stop Debt Collection Abuse Act of 2019 would:

- Amend the FDCPA to make clear that protections from overly aggressive debt collection practices also apply to debt collection agents hired by the federal government

- Amend the FDCPA to make clear that overpayment, fines, penalties, and fees owed by private individuals to federal government entities should be considered "consumer debts" that fall under the FDCPA's protections

- Prevent private debt collectors from charging exorbitant and unfair fees

- Ensure that fees from debt collectors working on behalf of the federal government cannot be greater than 10% of the amount collected and must be reasonable

- Confirm that debt buyers are debt collectors for the purposes of the FDCPA

- Set forth requirements that prevent debt collectors from taking aggressive action unnecessarily quickly after a debt has allegedly gone unpaid

- Require the Government Accountability Office (GAO) to conduct a study into the use of third party debt collectors by state and local government

Supporters of the bill include: Americans for Financial Reform, Allied Progress, California Reinvestment Coalition, Consumer Action, Consumer Federation of America, Consumer Reports, Florida Alliance for Consumer Protection, Illinois Asset Building Group, Legal Services of New Jersey, Maryland Consumer Rights Coalition, NAACP, National Association of Consumer Advocates, National Center for Law and Economic Justice, National Consumer Law Center, Public Citizen, Public Justice Center, Public Law Center, Statewide Poverty Action Network, and Tennessee Citizen Action.

Emanuel Cleaver, II is the U.S. Representative for Missouri's Fifth Congressional District, which includes Kansas City, Independence, Lee's Summit, Raytown, Grandview, Sugar Creek, Blue Springs, Grain Valley, Oak Grove, North Kansas City, Gladstone, Claycomo, and all of Ray, Lafayette, and Saline Counties. He is a member of the exclusive House Financial Services Committee; Chairman of the House Subcommittee on National Security, International Development, and Monetary Policy; member of the Select Committee on the Modernization of Congress; member of the Committee on Homeland Security; and a Senior Whip of the Democratic Caucus. For more information, please contact Matthew Helfant at 202-225-4535 or Matthew.Helfant@mail.house.gov a high-resolution photo of Congressman Cleaver is available here.