Since the Consumer Financial Protection Bureau is in charge of protecting consumers from financial misdeeds, it should come as no surprise that this group collects and tracks consumer complaints. When all the complaints from consumers are considered for calculations debt collection continues to be the type of issue most often reported to the CFPB. The organization recently released a couple of reports that show which consumers are the most at-risk for these types of issues and the businesses that are involved in debt collections actions.
Going back to March 1st, the CFPB revealed that California, Florida, New York, Texas and Illinois are the states that combine to account for in excess of 40 percent of all the complaints logged since summer of 2011. In Florida almost 60 percent of the complaints from state residents can be traced to three major metro areas – Tampa, Orlando and Miami.
Here is something that is really troubling to a lot of people – military veterans and their families continue to be the most at-risk for debt collection issues. And that is even when compared to the rest of the population. When tabulating the complaints that have been logged by folks in the military community, debt collection issues come in at about 46 percent of all complaints filed by military personnel and/or their immediate family members. If you want to compare this stat with the overall numbers, the CFPB states that these types of complaints account for 26 percent of total complaints collected thus far.
It seems that debt collection issues are not the only concerns that military families have. Mortgage complaints come in second place for complaints logged by this group, at about 15 percent. Many service members find themselves coming home from deployment and have also reported complaints about fraudulent credit report activity and identity theft instances.
So, what kind of companies are responsible for the steady amount of debt collection actions in the United States? The CFPB complaints have indicated that Encore Capital Group, based out of San Diego and Portfolio Recovery Associates, based out of Virginia are two of the biggest debt collection companies in the United States, and they have been mentioned most frequently in complaints logged to the CFPB. Each of these companies were mentioned in more than 100 complaints each month, from October to December of 2015.
Is the CFPB doing anything about all of the complaints it receives? The bureau says that it took enforcement measures against the firms mentioned for actions that include deceptive debt collection practices and debt purchasing. In fact, Portfolio Recovery Associates was fined $8 million and ordered to repay about $19 million to consumers. The company also had to cease collection actions on about $3 million worth of debts. Encore Capital, meanwhile, was ordered to stop their collection efforts on nearly $125 million in debts, to repay consumers $19 million and they also had to pay a hefty $10 million fine.
Since so many people have a vested interest in taking care of military members and their families, it will be interesting to see if the CFPB actually takes any direction action to focus on the unique financial challenges that many military families seem to be dealing with. If there are debt collection agencies out there that are continually targeting military personnel for harassment, for example, then the CFPB needs to step in and use its considerable power to provide a bit of relief for those who have taken it upon themselves to defend this country as a way of life. It really is the right thing to do.
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