But doing the less controversial update of debt collection communications and disclosures first could also potentially allow the CFPB to avoid any rule getting invalidated by a Republican Congress through the Congressional Review Act, since there is wide agreement among consumer advocates and the industry that those rules need to be updated, said Jonathan Pompan, a partner with Venable LLP.
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The FDCPA technically only covers third-party collectors, but those firms rely on information provided by banks and other debt issuers, so any CFPB rule would have to extend the FDCPA. That would be contentious and could bring in opposition from the entire financial industry, said Margot Saunders, an attorney with the National Consumer Law Center.
And that level of opposition could lead to Republicans in Congress using the Congressional Review Act to invalidate the rule, she said.
"I think that is likely to be their reasoning. And I think that it's a whole lot easier to take on the debt collectors than the entire consumer financial services industry," she said.
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Taking on issues around when a debt collector can call a cellphone and other similar questions might not engender as much of a response from lawmakers, particularly since debt collection firms have been seeking clarifications, Pompan said.
"Modernization has been championed by virtually all segments of the industry for many years now and would significantly benefit not just market participants, but consumers," he said.