Debt Collection: It’s What’s for Dinner

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October 12, 2016 by Lisa Brammer

If you read my blogs or my articles in the UCS Newsletter you know how strongly I feel about the collection industry’s bum rap. It is often distastefully served up to the public by the media and politicians as an entity to be stopped even though it plays a vital role in the health of our economy.

Ours is a very heavily regulated industry and I’m not naïve (nor are you) enough to believe there weren’t legitimate reasons why so many laws were put into place.

The thing is, when a problem is identified and a correction needs to take place, sometimes during the correction as the pendulum swings, it keeps swinging and ends going too far in the opposite direction. It’s kind of like the time I went to make an apple pie and realized I didn’t have any cinnamon—none whatsoever! Then, every time a holiday came up or I’d plan to do some baking, I’d throw a new jar of cinnamon into my grocery cart. I’m too embarrassed to tell you how many jars of cinnamon I now have!

Back in 1914, the Federal Trade Commission Act established the (yes, you guessed it) the Federal Trade Commission. Its principal mission? Consumer protection. According to their website they are the nation’s consumer protection agency, working to prevent fraudulent, deceptive, and unfair business practices.  Great!  In 1977, The Fair Debt Collection Practices Act, FDCPA, went into effect and is enforced by the FTC (that makes sense).  Its principal mission? To eliminate abusive collection practices of consumer debts, promote fair debt collection, and to provide consumers a way to validate or dispute a debt. Yes, still great.

Then in 2010, in response to the Great Recession the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law, which in turn authorized the creation of the Consumer Financial Protection Bureau to protect consumers…wait, what? Sound familiar?

I totally get how devastating the financial crisis was to our economy—I was there, I experienced it. I watched The Big Short. We certainly needed reform, but did we really need to get another jar of cinnamon?

Now we have the CFPB overseeing the collection industry too.

Today, when a consumer has a grievance with a financial product they can go to the CFPB’s website and file a complaint. Then the Bureau can assist consumers with resolutions and use all the information gleaned from their complaint database when policymaking. Sound good? It would if the database was a reliable resource.  According to the article “An Unreliable Resource” in the ACA International magazine Collector, “The Consumer Financial Protection Bureau’s consumer complaint database is rife with methodological and analytical flaws that render the data nearly useless for policymaking and ultimately confuse consumers…”

To submit a complaint consumers must first pick a category from a list of eleven (one of which is debt collection). If debt collection is selected as the primary category, six of the original eleven categories also show up as sub-categories of debt collection. Confused? You’re not alone. I read in the previously mentioned article that even CFPB’s head-honcho, Director Richard Cordray admitted during a U.S. House Financial Services Committee hearing that “when we look at debt, some of these complaints are simply misclassified; people think they are complaining about debt collection” when they should be complaining about another financial service.

It seems that many consumer complaints filed against debt collectors are actually more about the fact they owe money and not about the debt collector at all. Sometimes it’s just another case of people shooting the messenger which at the end of the day ends up recorded as yet another red mark against us (collection industry) on our CFPB report card.

Our industry is predominately made up of hard working, law abiding agencies like us here at United Credit Service. We are working diligently and continually to improve our processes to ensure a great, lawful consumer experience. We also are working hard to improve our industry’s poor reputation which is repeatedly portrayed inaccurately even by those who understand their data is flawed.

Founded in 1950, United Credit Service, Inc. is a full service, licensed revenue cycle management and debt collection agency in Wisconsin providing effective, customized one on one management and recovery solutions for our business partners. Visit our website at, call 877-723-2902 or check out our YouTube video.


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