The Consumer Financial Protection Bureau proposed a rule Thursday to include consumer reporting agencies and debt collectors -- for the first time in their history -- as part of its supervision of nonbank financial companies.
Our proposed rule would mean that those debt collectors and credit reporting agencies that qualify as larger participants are subject to the same supervision process that we apply to the banks, CFPB Director Richard Cordray said in a statement.
The agency was created under terms of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. In January 2012 President Obama appointed Cordray as the CFPB's first director.
The newly proposed regulation, which must be finalized by July 21, would open the books of debt collectors with more than $10 million in annual receipts from collection. Debt collectors such as Asset Acceptance Capital, Encore Capital Group and Portfolio Recovery Associates, as well as credit bureaus such as Equifax, Experian and TransUnion would end up within the CFPB's regulatory reach.
A total of 175 debt collection firms and 30 consumer reporting agencies would be covered under the rule.
The CFPB's supervision opens the books of an industry unfamiliar with federal regulators. The bureau would watch for incursions of the Fair Debt Collection Practices Act or the Fair Credit Reporting Act.
The rule is the first in a series the CFPB must make to define the larger participants outside the banking industry it will monitor.