CFPB, FTC highlight medical debt, dark patterns in debt collection reports

The Consumer Financial Protection Bureau and the Federal Trade Commission this week issued their annual reporting of their debt collection activities. The CFPB, required under the Consumer Financial Protection Act to report to Congress annually on its activities to administer the Fair Debt Collection Practices Act, recounted its ongoing work on medical debt. Notably, in the last year, the Bureau released a notice of proposed rulemaking on medical debt to remove medical bills from most credit reports. The report also covered consumer debt collection complaints, its supervisory highlights, research and enforcement actions. The Bureau also reported findings from its rental debt collection complaints, including illegal collection tactics and tacked-on fees.

Meanwhile, the FTC also publicly released its annual letter to the CFPB summarizing the Commission’s 2023 debt collection activities.The letter, dated February 9, was released this week, and informs the CFPB’s annual report. Among other things, the FTC highlighted its enforcement on illegal collection tactics on merchant cash advances, illegal income-share agreements used by a for-profit college, and illegal tactics such as dark patterns used for unwanted subscription charges that lead to financial hardships for consumers.