CFPB Debt Collection Plan Doesn't Spare Banks (John Rossman quoted)
John Rossman, chair of Moss & Barnett's creditors' remedies and bankruptcy team, was quoted in the Bloomberg BNA article, CFPB Debt Collection Plan Doesn't Spare Banks (written by Jeff Bater, Aug. 2, 2016). Excerpts from that article appear below.
John K. Rossman, an attorney at Moss & Barnett in Minneapolis, said one burden banks face is a requirement to provide a written representation that they have adopted and implemented reasonable written policies and procedures to ensure that accuracy of transferred information about debts, and that the transferred information is identical to the information in the bank's records.
"Banks certainly endeavor to provide accurate information to debt collectors and most already have such policies in place," Rossman said in an e-mail. “However, if the debt collector rules ultimately incorporate this requirement, banks will likely be subject to discovery from plaintiffs' lawyers in FDCPA and related lawsuits from plaintiffs' seeking information about the ‘reasonable written policies and procedures to ensure the accuracy of the transferred information.'”
“Further, if for some reason the information the bank provides to the debt collector is inaccurate, could this result in liability for the bank in a private cause of action (in additional to certain regulatory liability pursuant to UDAAP)?” he added, referring to unfair, deceptive, or abusive acts and practices as defined by the Dodd-Frank Act.
Rossman said banks will also be required to transmit to the debt collector information regarding – among other things – disputes and bankruptcy filings. “This could create a logistical quagmire for the bank seeking to coordinate a multi-channel flow of information, especially if the process includes a first-party customer service entity, a third-party debt collector and a collection attorney,” he said.