I 

117TH CONGRESS 

1ST SESSION H. R. 2547 

To expand and enhance consumer, student, servicemember, and small business 

protections with respect to debt collection practices, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 15, 2021 

Ms. WATERS (for herself, Mr. MEEKS, Ms. DEAN, Mr. CLEAVER, Ms. 

VELA ́ZQUEZ, Mr. AUCHINCLOSS, Ms. PRESSLEY, and Ms. TLAIB) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To expand and enhance consumer, student, servicemember, 

and small business protections with respect to debt collection practices, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Comprehensive Debt Collection Improvement Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—SMALL BUSINESS LENDING FAIRNESS ACT 


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Sec. 101. Short title. 

Sec. 102. Obligor transactions. 

Sec. 103. Enforcement of security interests. 

TITLE II —FAIR DEBT COLLECTION PRACTICES FOR 

SERVICEMEMBERS ACT 

Sec. 201. Short title. 

Sec. 202. Enhanced protection against debt collector harassment of 

servicemembers. 

Sec. 203. GAO study and report. 

TITLE III—PRIVATE LOAN DISABILITY DISCHARGE ACT 

Sec. 301. Short title. 

Sec. 302. Protections for obligors and cosigners in case of death or total and 

permanent disability. 

TITLE IV—CONSUMER PROTECTION FOR MEDICAL DEBT 

COLLECTIONS ACT 

Sec. 401. Short title. 

Sec. 402. Amendments to the Fair Debt Collection Practices Act. 

Sec. 403. Prohibition on consumer reporting agencies reporting certain medical 

debt. 

Sec. 404. Requirements for furnishers of medical debt information. 

TITLE V—ENDING DEBT COLLECTION HARASSMENT ACT 

Sec. 501. Short title. 

Sec. 502. Consumer protections relating to debt collection practices. 

TITLE VI—STOP DEBT COLLECTION ABUSE ACT 

Sec. 601. Short title. 

Sec. 602. Definitions. 

Sec. 603. Debt collection practices for debt collectors hired by Federal agencies. 

Sec. 604. Unfair practices. 

Sec. 605. GAO study and report. 

TITLE VII—DEBT COLLECTION PRACTICES HARMONIZATION ACT 

Sec. 701. Short title. 

Sec. 702. Award of damages. 

Sec. 703. Prohibition on the referral of emergency individual assistance debt. 

TITLE VIII—NON-JUDICIAL FORECLOSURE DEBT COLLECTION 

CLARIFICATION ACT 

Sec. 801. Short title. 

Sec. 802. Enforcement of security interests. 

TITLE IX—EFFECTIVE DATE 

Sec. 901. Effective date. 


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1 TITLE I—SMALL BUSINESS 

2 LENDING FAIRNESS ACT 

3 SEC. 101. SHORT TITLE. 

4 This title may be cited as the ‘‘Small Business Lend5 ing Fairness Act’’. 

6 SEC. 102. OBLIGOR TRANSACTIONS. 

7 (a) IN GENERAL.—Chapter 2 of the Truth in Lend8 ing Act (15 U.S.C. 1631 et seq.) is amended by adding 

9 at the end the following: 

10 ‘‘§ 140B. Unfair credit practices 

11 ‘‘(a) IN GENERAL.—In connection with the extension 

12 of credit or creation of debt in or affecting commerce, as 

13 defined in section 4 of the Federal Trade Commission Act 

14 (15 U.S.C. 44), including any advance of funds or sale 

15 or assignment of future income or receivables that may 

16 or may not be credit, no person may directly or indirectly 

17 take or receive from another person an obligation that con18 stitutes or contains a cognovit or confession of judgment 

19 (for purposes other than executory process in the State 

20 of Louisiana), warrant of attorney, or other waiver of the 

21 right to notice and the opportunity to be heard in the 

22 event of suit or process thereon. 

23 ‘‘(b) EXEMPTION.—The exemption in section 104(1) 

24 shall not apply to this section.’’. 

25 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 


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1 (1) Section 130(a) of the Truth in Lending Act 

2 (15 U.S.C. 1640) is amended by striking ‘‘creditor’’ 

3 each place the term appears and inserting ‘‘person’’. 

4 (2) The table of sections in chapter 2 of the 

5 Truth in Lending Act (15 U.S.C. 1631 et seq.) is 

6 amended by adding at the end the following: 

‘‘140B. Unfair credit practices.’’. 

7 SEC. 103. ENFORCEMENT OF SECURITY INTERESTS. 

8 Section 103 of the Truth in Lending Act (15 U.S.C. 

9 1602) is amended by adding at the end the following: 

10 ‘‘(ff) The term ‘debt’ means any obligation of a per11 son to pay to another person money— 

12 ‘‘(1) regardless of whether such obligation is 

13 absolute or contingent; 

14 ‘‘(2) that includes the right of the person pro15 viding the money to an equitable remedy for breach 

16 of performance if the breach gives rise to a right to 

17 payment; and 

18 ‘‘(3) regardless of whether the obligation or 

19 right to an equitable remedy described in paragraph 

20 (2) has been reduced to judgment, fixed, contingent, 

21 matured, unmatured, disputed, undisputed, recourse, 

22 nonrecourse, secured, or unsecured.’’. 


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1 TITLE II—FAIR DEBT COLLEC2 TION PRACTICES FOR 

3 SERVICEMEMBERS ACT 

4 SEC. 201. SHORT TITLE. 

5 This title may be cited as the ‘‘Fair Debt Collection 

6 Practices for Servicemembers Act’’. 

7 SEC. 202. ENHANCED PROTECTION AGAINST DEBT COL8 LECTOR HARASSMENT OF 

9 SERVICEMEMBERS. 

10 (a) COMMUNICATION IN CONNECTION WITH DEBT

11 COLLECTION.—Section 805 of the Fair Debt Collection 

12 Practices Act (15 U.S.C. 1692c) is amended by adding 

13 at the end the following: 

14 ‘‘(e) COMMUNICATIONS CONCERNING SERVICEMEM15 BER DEBTS.— 

16 ‘‘(1) DEFINITION.—In this subsection, the term 

17 ‘covered member’ means— 

18 ‘‘(A) a covered member or a dependent as 

19 defined in section 987(i) of title 10, United 

20 States Code; and 

21 ‘‘(B)(i) an individual who was separated, 

22 discharged, or released from duty described in 

23 such section 987(i)(1), but only during the 365- 

24 day period beginning on the date of separation, 

25 discharge, or release; or 


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1 ‘‘(ii) a person, with respect to an individual 

2 described in clause (i), described in subpara3 graph (A), (D), (E), or (I) of section 1072(2) 

4 of title 10, United States Code. 

5 ‘‘(2) PROHIBITIONS.—A debt collector may not, 

6 in connection with the collection of any debt of a 

7 covered member— 

8 ‘‘(A) threaten to have the covered member 

9 reduced in rank; 

10 ‘‘(B) threaten to have the covered mem11 ber’s security clearance revoked; or 

12 ‘‘(C) threaten to have the covered member 

13 prosecuted under chapter 47 of title 10, United 

14 States Code (the Uniform Code of Military Jus15 tice).’’. 

16 (b) UNFAIR PRACTICES.—Section 808 of the Fair 

17 Debt Collection Practices Act (15 U.S.C. 1692f) is amend18 ed by adding at the end the following: 

19 ‘‘(9) The representation to any covered member 

20 (as defined under section 805(e)(1)) that failure to 

21 cooperate with a debt collector will result in— 

22 ‘‘(A) a reduction in rank of the covered 

23 member; 

24 ‘‘(B) a revocation of the covered member’s 

25 security clearance; or 


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1 ‘‘(C) prosecution under chapter 47 of title 

2 10, United States Code (the Uniform Code of 

3 Military Justice).’’. 

4 SEC. 203. GAO STUDY AND REPORT. 

5 (a) STUDY.—The Comptroller General of the United 

6 States shall conduct a study on the impact of debt collec7 tion on covered members (as defined under section 

8 805(e)(1) of the Fair Debt Collection Practices Act, as 

9 added by section 202), which shall— 

10 (1) identify types of false, deceptive, misleading, 

11 unfair, abusive, and harassing debt collection prac12 tices experienced by covered members and make rec13 ommendations to eliminate these practices; 

14 (2) identify collection practices of creditors and 

15 debt collectors experienced by covered members; 

16 (3) discuss the effect of these practices on mili17 tary readiness; and 

18 (4) discuss any national security implications, 

19 including the extent to which covered members with 

20 security clearances would be impacted by uncollected 

21 debt. 

22 (b) REPORT.—Not later than one year after the date 

23 of enactment of this Act, the Comptroller General of the 

24 United States shall submit to Congress a report on the 

25 completed study required under subsection (a). 


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1 TITLE III—PRIVATE LOAN 

2 DISABILITY DISCHARGE ACT 

3 SEC. 301. SHORT TITLE. 

4 This title may be cited as the ‘‘Private Loan Dis5 ability Discharge Act of 2021’’. 

6 SEC. 302. PROTECTIONS FOR OBLIGORS AND COSIGNERS IN 

7 CASE OF DEATH OR TOTAL AND PERMANENT 

8 DISABILITY. 

9 (a) IN GENERAL.—Section 140(g) of the Truth in 

10 Lending Act (15 U.S.C. 1650(g)) is amended— 

11 (1) in paragraph (2)— 

12 (A) in the heading, by striking ‘‘IN CASE

13 OF DEATH OF BORROWER’’; 

14 (B) in subparagraph (A), by inserting after 

15 ‘‘of the death’’, the following: ‘‘or total and per16 manent disability’’; and 

17 (C) in subparagraph (C), by inserting after 

18 ‘‘of the death’’, the following: ‘‘or total and per19 manent disability’’; and 

20 (2) by adding at the end the following: 

21 ‘‘(3) DISCHARGE IN CASE OF DEATH OR TOTAL

22 AND PERMANENT DISABILITY OF BORROWER.—The 

23 holder of a private education loan shall, when noti24 fied of the death or total and permanent disability 

25 of a student obligor, discharge the liability of the 


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1 student obligor on the loan and may not, after such 

2 notification— 

3 ‘‘(A) attempt to collect on the outstanding 

4 liability of the student obligor; and 

5 ‘‘(B) in the case of total and permanent 

6 disability, monitor the disability status of the 

7 student obligor at any point after the date of 

8 discharge. 

9 ‘‘(4) PRIVATE DISCHARGE IN CASES OF CER10 TAIN DISCHARGE FOR DEATH OR DISABILITY.—The 

11 holder of a private education loan shall, when noti12 fied of the discharge of liability of a student obligor 

13 on a loan described under section 108(f)(5)(A) of 

14 the Internal Revenue Code of 1986, discharge any li15 ability of the student obligor (and any cosigner) on 

16 any private education loan which the private edu17 cation loan holder holds and may not, after such no18 tification— 

19 ‘‘(A) attempt to collect on the outstanding 

20 liability of the student obligor; and 

21 ‘‘(B) in the case of total and permanent 

22 disability, monitor the disability status of the 

23 student obligor at any point after the date of 

24 discharge. 


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1 ‘‘(5) TOTAL AND PERMANENT DISABILITY DE2 FINED.—For the purposes of this subsection and 

3 with respect to an individual, the term ‘total and 

4 permanent disability’ means the individual is totally 

5 and permanently disabled, as such term is defined in 

6 section 685.102(b) of title 34, Code of Federal Reg7 ulations.’’. 

8 (b) RULEMAKING.—The Director of the Bureau of 

9 Consumer Financial Protection may issue rules to imple10 ment the amendments made by subsection (a) as the Di11 rector determines appropriate. 

12 TITLE IV—CONSUMER PROTEC13 TION FOR MEDICAL DEBT 

14 COLLECTIONS ACT 

15 SEC. 401. SHORT TITLE. 

16 This title may be cited as the ‘‘Consumer Protection 

17 for Medical Debt Collections Act’’. 

18 SEC. 402. AMENDMENTS TO THE FAIR DEBT COLLECTION 

19 PRACTICES ACT. 

20 (a) DEFINITION.—Section 803 of the Fair Debt Col21 lection Practices Act (15 U.S.C. 1692a) is amended by 

22 adding at the end the following: 

23 ‘‘(9) The term ‘medical debt’ means a debt 

24 arising from the receipt of medical services, 

25 products, or devices.’’. 


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1 (b) UNFAIR PRACTICES.—Section 808 of the Fair 

2 Debt Collection Practices Act (15 U.S.C. 1692f), as 

3 amended by section 202(b), is amended by adding at the 

4 end the following: 

5 ‘‘(10) Engaging in activities to collect or 

6 attempting to collect a medical debt owed or 

7 due or asserted to be owed or due by a con8 sumer, before the end of the 2-year period be9 ginning on the date that the first payment with 

10 respect to such medical debt is due.’’. 

11 SEC. 403. PROHIBITION ON CONSUMER REPORTING AGEN12 CIES REPORTING CERTAIN MEDICAL DEBT. 

13 (a) DEFINITION.—Section 603 of the Fair Credit Re14 porting Act (15 U.S.C. 1681a) is amended by adding at 

15 the end the following: 

16 ‘‘(bb) MEDICAL DEBT.—The term ‘medical debt’ 

17 means a debt arising from the receipt of medical services, 

18 products, or devices. 

19 ‘‘(cc) MEDICALLY NECESSARY PROCEDURE.—The 

20 term ‘medically necessary procedure’ means— 

21 ‘‘(1) health care services or supplies needed to 

22 diagnose or treat an illness, injury, condition, dis23 ease, or its symptoms and that meet accepted stand24 ards of medicine; and 


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1 ‘‘(2) health care to prevent illness or detect ill2 ness at an early stage, when treatment is likely to 

3 work best (including preventive services such as pap 

4 tests, flu shots, and screening mammograms).’’. 

5 (b) IN GENERAL.—Section 605(a) of the Fair Credit 

6 Reporting Act (15 U.S.C. 1681c(a)) is amended by adding 

7 at the end the following new paragraphs: 

8 ‘‘(9) Any information related to a debt arising 

9 from a medically necessary procedure. 

10 ‘‘(10) Any information related to a medical 

11 debt, if the date on which such debt was placed for 

12 collection, charged to profit or loss, or subjected to 

13 any similar action antedates the report by less than 

14 365 calendar days.’’. 

15 SEC. 404. REQUIREMENTS FOR FURNISHERS OF MEDICAL 

16 DEBT INFORMATION. 

17 (a) ADDITIONAL NOTICE REQUIREMENTS FOR MED18 ICAL DEBT.—Section 623 of the Fair Credit Reporting 

19 Act (15 U.S.C. 1681s–2) is amended by adding at the end 

20 the following: 

21 ‘‘(f) ADDITIONAL NOTICE REQUIREMENTS FOR MED22 ICAL DEBT.—Before furnishing information regarding a 

23 medical debt of a consumer to a consumer reporting agen24 cy, the person furnishing the information shall send a 

25 statement to the consumer that includes the following: 


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1 ‘‘(1) A notification that the medical debt— 

2 ‘‘(A) may not be included on a consumer 

3 report made by a consumer reporting agency 

4 until the later of the date that is 365 days 

5 after— 

6 ‘‘(i) the date on which the person 

7 sends the statement; 

8 ‘‘(ii) with respect to the medical debt 

9 of a borrower demonstrating hardship, a 

10 date determined by the Director of the Bu11 reau; or 

12 ‘‘(iii) the date described under section 

13 605(a)(10); and 

14 ‘‘(B) may not ever be included on a con15 sumer report made by a consumer reporting 

16 agency, if the medical debt arises from a medi17 cally necessary procedure. 

18 ‘‘(2) A notification that, if the debt is settled or 

19 paid by the consumer or an insurance company be20 fore the end of the period described under paragraph 

21 (1)(A), the debt may not be reported to a consumer 

22 reporting agency. 

23 ‘‘(3) A notification that the consumer may— 

24 ‘‘(A) communicate with an insurance com25 pany to determine coverage for the debt; or 


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1 ‘‘(B) apply for financial assistance.’’. 

2 (b) FURNISHING OF MEDICAL DEBT INFORMA3 TION.—Section 623 of the Fair Credit Reporting Act (15 

4 U.S.C. 1681s–2), as amended by subsection (a), is further 

5 amended by adding at the end the following: 

6 ‘‘(g) FURNISHING OF MEDICAL DEBT INFORMA7 TION.— 

8 ‘‘(1) PROHIBITION ON REPORTING DEBT RE9 LATED TO MEDICALLY NECESSARY PROCEDURES.— 

10 No person shall furnish any information to a con11 sumer reporting agency regarding a debt arising 

12 from a medically necessary procedure. 

13 ‘‘(2) TREATMENT OF OTHER MEDICAL DEBT IN14 FORMATION.—With respect to a medical debt not 

15 described under paragraph (1), no person shall fur16 nish any information to a consumer reporting agen17 cy regarding such debt before the end of the 365- 

18 day period beginning on the later of— 

19 ‘‘(A) the date on which the person sends 

20 the statement described under subsection (f) to 

21 the consumer; 

22 ‘‘(B) with respect to the medical debt of a 

23 borrower demonstrating hardship, a date deter24 mined by the Director of the Bureau; or 


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1 ‘‘(C) the date described in section 

2 605(a)(10). 

3 ‘‘(3) TREATMENT OF SETTLED OR PAID MED4 ICAL DEBT.—With respect to a medical debt not de5 scribed under paragraph (1), no person shall furnish 

6 any information to a consumer reporting agency re7 garding such debt if the debt is settled or paid by 

8 the consumer or an insurance company before the 

9 end of the 365-day period described under para10 graph (2). 

11 ‘‘(4) BORROWER DEMONSTRATING HARDSHIP

12 DEFINED.—In this subsection, and with respect to a 

13 medical debt, the term ‘borrower demonstrating 

14 hardship’ means a borrower or a class of borrowers 

15 who, as determined by the Director of the Bureau, 

16 is facing or has experienced extenuating life cir17 cumstances or events that result in severe financial 

18 or personal barriers such that the borrower or class 

19 of borrowers does not have the capacity to repay the 

20 medical debt.’’. 

21 TITLE V—ENDING DEBT 

22 COLLECTION HARASSMENT ACT 

23 SEC. 501. SHORT TITLE. 

24 This title may be cited as the ‘‘Ending Debt Collec25 tion Harassment Act of 2021’’. 


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1 SEC. 502. CONSUMER PROTECTIONS RELATING TO DEBT 

2 COLLECTION PRACTICES. 

3 (a) REPORTS ON DEBT COLLECTION COMPLAINTS

4 AND ENFORCEMENT ACTIONS.— 

5 (1) SEMI-ANNUAL REPORT.—Section 1016(c) of 

6 the Consumer Financial Protection Act of 2010 (12 

7 U.S.C. 5496(c)) is amended— 

8 (A) in paragraph (8), by striking ‘‘and’’ at 

9 the end; 

10 (B) in paragraph (9), by striking the pe11 riod at the end and inserting a semicolon; and 

12 (C) by adding at the end the following: 

13 ‘‘(10) an analysis of the consumer complaints 

14 received by the Bureau with respect to debt collec15 tion, including a State-by-State breakdown of such 

16 complaints; and 

17 ‘‘(11) a list of enforcement actions taken 

18 against debt collectors during the preceding year.’’. 

19 (2) ANNUAL REPORT.—Section 815(a) of the 

20 Fair Debt Collection Practices Act (15 U.S.C. 

21 1692m(a)) is amended by adding at the end the fol22 lowing new sentence: ‘‘Each such report shall also 

23 include an analysis of the impact of electronic com24 munications by debt collectors on consumer experi25 ences with debt collection, including a consideration 


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1 of consumer complaints about the use of electronic 

2 communications in debt collection.’’. 

3 (b) LIMITATION ON DEBT COLLECTION RULES.— 

4 Section 1022 of the Consumer Financial Protection Act 

5 of 2010 (12 U.S.C. 5512) is amended by adding at the 

6 end the following: 

7 ‘‘(e) LIMITATION ON DEBT COLLECTION RULES.— 

8 The Director may not issue any rule with respect to debt 

9 collection that allows a debt collector to send unlimited 

10 email and text messages to a consumer.’’. 

11 (c) PROTECTION OF CONSUMERS FROM UNLIMITED

12 TEXTS AND EMAILS USED IN DEBT COLLECTION.—Sec13 tion 806 of the Fair Debt Collection Practices Act (15 

14 U.S.C. 1692d) is amended by adding at the end the fol15 lowing new paragraph: 

16 ‘‘(7) Contacting the consumer electronically (in17 cluding by email or text message) without consent of 

18 the consumer to communicate via that method, after 

19 such consent has been withdrawn, or more fre20 quently than the consumer consents to be con21 tacted.’’. 

22 (d) ENSURING CONSUMERS RECEIVE NOTICE OF

23 DEBT COLLECTION PROTECTIONS.—Section 809(a) of the 

24 Fair Debt Collection Practices Act (15 U.S.C. 1692g(a)) 

25 is amended in the matter preceding paragraph (1)— 


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1 (1) by striking ‘‘Within five days’’ and all that 

2 follows through ‘‘debt,’’ and inserting the following: 

3 ‘‘NOTICE OF DEBT; CONTENTS.—Within five days 

4 after the initial communication with a consumer in 

5 connection with the collection of any debt,’’; and 

6 (2) by striking ‘‘, unless the following informa7 tion is contained in the initial communication or the 

8 consumer has paid the debt,’’. 

9 (e) IMPROVED LIMITATIONS ON DEBT COLLECTION

10 RULES.—Section 814(d) of the Fair Debt Collection Prac11 tices Act (15 U.S.C. 1692l(d)) is amended by adding at 

12 the end the following: ‘‘Such rules— 

13 ‘‘(1) may not allow a debt collector to send un14 limited electronic communications to a consumer; 

15 ‘‘(2) shall require debt collectors to obtain con16 sent directly from consumers before contacting them 

17 using a method other than by postal mail or by 

18 phone; 

19 ‘‘(3) may not waive the requirements of the 

20 Electronic Signatures in Global and National Com21 merce Act (15 U.S.C. 7001 et seq.); and 

22 ‘‘(4) shall allow consumers to opt out of any 

23 method of communication that the debt collector 

24 uses to communicate with consumers, including a 


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1 method for which such consumer had given prior 

2 consent.’’. 

3 TITLE VI—STOP DEBT 

4 COLLECTION ABUSE ACT 

5 SEC. 601. SHORT TITLE. 

6 This title may be cited as the ‘‘Stop Debt Collection 

7 Abuse Act of 2021’’. 

8 SEC. 602. DEFINITIONS. 

9 Section 803 of the Fair Debt Collection Practices Act 

10 (15 U.S.C. 1692a) is amended— 

11 (1) in paragraph (4), by striking ‘‘facilitating 

12 collection of such debt for another’’ and inserting 

13 ‘‘collection of such debt’’; 

14 (2) by amending paragraph (5) to read as fol15 lows: 

16 ‘‘(5) The term ‘debt’ means any obligation or 

17 alleged obligation of a consumer— 

18 ‘‘(A) to pay money arising out of a trans19 action in which the money, property, insurance 

20 or services which are the subject of the trans21 action are primarily for personal, family, or 

22 household purposes, whether or not such obliga23 tion has been reduced to judgment; 

24 ‘‘(B) to pay a loan, overpayment, fine, pen25 alty, restitution, fee, or other money currently 


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1 or originally owed to or guaranteed by a Fed2 eral or State government, including any courts 

3 or agencies; or 

4 ‘‘(C) which is secured by real or personal 

5 property that is used or was obtained primarily 

6 for personal, family, or household purposes, 

7 where such property is subject to forfeiture or 

8 repossession upon nonpayment of the obligation 

9 or alleged obligation.’’; and 

10 (3) in paragraph (6)— 

11 (A) by redesignating subparagraphs (A) 

12 through (F) as clauses (i) through (vi), respec13 tively; 

14 (B) in clause (iii), as so redesignated, by 

15 inserting ‘‘(not including an independent con16 tractor)’’ after ‘‘any State’’; 

17 (C) by amending clause (vi), as so redesig18 nated, to read as follows: 

19 ‘‘(vi) any person collecting or attempting 

20 to collect any debt owed or due or asserted to 

21 be owed or due another to the extent such ac22 tivity— 

23 ‘‘(I) is incidental to a bona fide fidu24 ciary obligation or a bona fide escrow ar25 rangement; 


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1 ‘‘(II) concerns a debt which was origi2 nated by such person; 

3 ‘‘(III) concerns a debt which was not 

4 in default at the time it was obtained by 

5 such person; or 

6 ‘‘(IV) concerns a debt obtained by 

7 such person as a secured party in a com8 mercial credit transaction involving the 

9 creditor.’’; 

10 (D) by striking the first and second sen11 tences and inserting the following: 

12 ‘‘(6)(A) The term ‘debt collector’ means— 

13 ‘‘(i) any person who uses any instrumen14 tality of interstate commerce or the mails in 

15 any business the principal purpose of which is 

16 the collection of any debts; 

17 ‘‘(ii) any person who regularly collects or 

18 attempts to collect, directly or indirectly, by the 

19 person’s own means or by hiring another debt 

20 collector, debts owed or due or asserted to be 

21 owed or due another or that have been obtained 

22 by assignment or transfer from another; 

23 ‘‘(iii) any person who regularly collects 

24 debts currently or originally owed or allegedly 

25 owed to a Federal or State agency or court; or 


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1 ‘‘(iv) notwithstanding subparagraph 

2 (B)(vi), any creditor who in the process of col3 lecting debts of such creditor, uses another 

4 name that would indicate that a third person is 

5 collecting or attempting to collect such debts.’’; 

6 and 

7 (E) in the fourth sentence, by striking 

8 ‘‘The term does not’’ and inserting the fol9 lowing: 

10 ‘‘(B) The term does not’’. 

11 SEC. 603. DEBT COLLECTION PRACTICES FOR DEBT COL12 LECTORS HIRED BY FEDERAL AGENCIES. 

13 (a) IN GENERAL.—The Fair Debt Collection Prac14 tices Act (15 U.S.C. 1692 et seq.) is amended by inserting 

15 after section 812 (15 U.S.C. 1692j) the following: 

16 ‘‘§ 812A. Debt collection practices for debt collectors 

17 hired by Federal agencies 

18 ‘‘(a) LIMITATION ON TIME TO TURN DEBT OVER TO

19 DEBT COLLECTOR.—A Federal agency that is a creditor 

20 may sell or transfer a debt described in section 803(5)(B) 

21 to a debt collector not earlier than 90 days after the date 

22 on which the obligation or alleged obligation becomes de23 linquent or defaults. 

24 ‘‘(b) REQUIRED NOTICE.— 


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1 ‘‘(1) IN GENERAL.—Before transferring or sell2 ing a debt described in section 803(5)(B) to a debt 

3 collector or contracting with a debt collector to col4 lect such a debt, a Federal agency shall notify the 

5 consumer not fewer than 3 times that the Federal 

6 agency will take such action. 

7 ‘‘(2) FREQUENCY OF NOTIFICATIONS.—The 

8 second and third notifications described in para9 graph (1) shall be made not less than 30 days after 

10 the date on which the previous notification is 

11 made.’’. 

12 (b) CLERICAL AMENDMENT.—The table of contents 

13 for the Fair Debt Collection Practices Act is amended by 

14 inserting after the item relating to section 812 the fol15 lowing: 

‘‘812A. Debt collection practices for debt collectors hired by Federal agencies.’’. 

16 SEC. 604. UNFAIR PRACTICES. 

17 Section 808 of the Fair Debt Collection Practices Act 

18 (15 U.S.C. 1692f) is amended by striking paragraph (1) 

19 and inserting the following: 

20 ‘‘(1) The collection of any amount (including 

21 any interest, fee, charge, or expense incidental to the 

22 principal obligation) unless— 

23 ‘‘(A) such amount is expressly authorized 

24 by the agreement creating the debt or permitted 

25 by law; and 


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1 ‘‘(B) in the case of any amount charged by 

2 a debt collector collecting a debt described in 

3 section 803(5)(B), such amount is— 

4 ‘‘(i) reasonable in relation to the ac5 tual costs of the collection; 

6 ‘‘(ii) authorized by a contract between 

7 the debt collector and the Federal or State 

8 government; and 

9 ‘‘(iii) not greater than 10 percent of 

10 the amount collected by the debt col11 lector.’’. 

12 SEC. 605. GAO STUDY AND REPORT. 

13 (a) STUDY.—The Comptroller General of the United 

14 States shall commence a study on the use of debt collec15 tors by Federal, State, and local government agencies, in16 cluding— 

17 (1) the powers given to the debt collectors by 

18 Federal, State, and local government agencies; 

19 (2) the contracting process that allows a Fed20 eral, State, or local government agency to award 

21 debt collection to a certain company, including the 

22 selection process; 

23 (3) any fees charged to debtors in addition to 

24 principal and interest on the outstanding debt; 


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1 (4) how the fees described in paragraph (3) 

2 vary from State to State; 

3 (5) consumer protection at the State level that 

4 offer recourse to those whom debts have been wrong5 fully attributed; 

6 (6) the revenues received by debt collectors 

7 from Federal, State, and local government agencies; 

8 (7) the amount of any revenue sharing agree9 ments between debt collectors and Federal, State, 

10 and local government agencies; 

11 (8) the difference in debt collection procedures 

12 across geographic regions, including the extent to 

13 which debt collectors pursue court judgments to col14 lect debts; 

15 (9) information regarding the amount collected 

16 by Federal, State, and local government agencies 

17 through debt collectors, including the total amount 

18 and the percentage of the amount referred to the 

19 debt collectors; 

20 (10) the full cost of outsourcing collection to 

21 debt collectors; 

22 (11) government agency oversight of debt col23 lectors to ensure that the rights of a consumer (as 

24 defined in section 803(3) of the Fair Debt Collection 

25 Practices Act (15 U.S.C. 1692a(3))) are protected 


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1 and that any debt relief and payment options legally 

2 available to consumers is effectively communicated 

3 and made available; 

4 (12) the extent to which Federal, State, and 

5 local contracts with debt collectors reflect or omit ef6 fective measures to encourage debt collectors to 

7 align their practices with public policy concerns (in8 cluding relief for consumers experiencing financial 

9 hardship) beyond maximizing debt collection; 

10 (13) the extent to which debt collectors induce 

11 payment through use or threat of adverse govern12 ment actions, such as arrest warrants or suspension 

13 of licenses or vehicle registration; and 

14 (14) demographic data, including race and in15 come information, regarding the individuals subject 

16 to private collection of debts owed to government en17 tities. 

18 (b) REPORT.—Not later than one year after the date 

19 of enactment of this Act, the Comptroller General of the 

20 United States shall submit to Congress a report on the 

21 completed study required under subsection (a). 


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1 TITLE VII—DEBT COLLECTION 

2 PRACTICES HARMONIZATION 

3 ACT 

4 SEC. 701. SHORT TITLE. 

5 This title may be cited as the ‘‘Debt Collection Prac6 tices Harmonization Act’’. 

7 SEC. 702. AWARD OF DAMAGES. 

8 (a) ADDITIONAL DAMAGES INDEXED FOR INFLA9 TION.— 

10 (1) IN GENERAL.—Section 813 of the Fair 

11 Debt Collection Practices Act (15 U.S.C. 1692k) is 

12 amended— 

13 (A) in subsection (a)(2)— 

14 (i) in subparagraph (A), by striking ‘‘; 

15 or’’ and inserting the following: ‘‘with re16 spect to any one action taken by a debt 

17 collector in violation of this subchapter; 

18 or’’; and 

19 (ii) in subparagraph (B)(ii), by strik20 ing ‘‘or 1 per centum of the net worth of 

21 the debt collector; and’’ and inserting the 

22 following: ‘‘or 5 percent of the gross an23 nual revenue of the debt collector: and’’; 

24 (B) in subsection (b), by inserting ‘‘the 

25 maximum amount of statutory damages at the 


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1 time of noncompliance,’’ before ‘‘the frequency’’ 

2 each place it appears; and 

3 (C) by adding at the end the following: 

4 ‘‘(f) ADJUSTMENT FOR INFLATION.— 

5 ‘‘(1) INITIAL ADJUSTMENT.—Not later than 90 

6 days after the date of the enactment of this sub7 section, the Bureau shall provide a percentage in8 crease (rounded to the nearest multiple of $100 or 

9 $1,000, as applicable) in the amounts set forth in 

10 this section equal to the percentage by which— 

11 ‘‘(A) the Consumer Price Index for All 

12 Urban Consumers (all items, United States city 

13 average) for the 12-month period ending on the 

14 June 30 preceding the date on which the per15 centage increase is provided, exceeds 

16 ‘‘(B) the Consumer Price Index for the 12- 

17 month period preceding January 1, 1978. 

18 ‘‘(2) ANNUAL ADJUSTMENTS.—With respect to 

19 any fiscal year beginning after the date of the in20 crease provided under paragraph (1), the Bureau 

21 shall provide a percentage increase (rounded to the 

22 nearest multiple of $100 or $1,000, as applicable) in 

23 the amounts set forth in this section equal to the 

24 percentage by which— 


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1 ‘‘(A) the Consumer Price Index for All 

2 Urban Consumers (all items, United States city 

3 average) for the 12-month period ending on the 

4 June 30 preceding the beginning of the fiscal 

5 year for which the increase is made, exceeds 

6 ‘‘(B) the Consumer Price Index for the 12- 

7 month period preceding the 12-month period 

8 described in subparagraph (A).’’. 

9 (2) APPLICABILITY.—The increases made under 

10 section 813(f) of the Fair Debt Collection Practices 

11 Act, as added by paragraph (1)(C) of this sub12 section, shall apply with respect to failures to comply 

13 with a provision of such Act (15 U.S.C. 1601 et 

14 seq.) occurring on or after the date of enactment of 

15 this section. 

16 (b) INJUNCTIVE RELIEF.—Section 813(d) of the Fair 

17 Debt Collection Practices Act (15 U.S.C. 1692k(d)) is 

18 amended by adding at the end the following: ‘‘In a civil 

19 action alleging a violation of this title, the court may 

20 award appropriate relief, including injunctive relief.’’. 

21 SEC. 703. PROHIBITION ON THE REFERRAL OF EMERGENCY 

22 INDIVIDUAL ASSISTANCE DEBT. 

23 Chapter 3 of title 31, United States Code, is amend24 ed— 


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1 (1) in subchapter II, by adding at the end the 

2 following: 

3 ‘‘§ 334. Prohibition on the referral of emergency indi4 vidual assistance debt 

5 ‘‘With respect to any assistance provided by the Fed6 eral Emergency Management Agency to an individual or 

7 household pursuant to the Robert T. Stafford Disaster Re8 lief and Emergency Assistance Act (42 U.S.C. 5122 et 

9 seq.), if the Secretary of the Treasury seeks to recoup any 

10 amount of such assistance because of an overpayment, the 

11 Secretary may not contract with any debt collector as de12 fined in section 803(6) of the Fair Debt Collection Prac13 tices Act (15 U.S.C. 1692a(6)) or other private party to 

14 collect such amounts, unless the overpayment occurred be15 cause of fraud or deceit and the recipient of such assist16 ance knew or should have known about such fraud or de17 ceit.’’; and 

18 (2) in the table of contents for such chapter, by 

19 inserting after the item relating to section 333 the 

20 following: 

‘‘334. Prohibition on the referral of emergency individual assistance debt.’’. 


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1 TITLE VIII—NON-JUDICIAL 

2 FORECLOSURE DEBT COL3 LECTION CLARIFICATION ACT 

4 SEC. 801. SHORT TITLE. 

5 This title may be cited as the ‘‘Non-Judicial Fore6 closure Debt Collection Clarification Act’’. 

7 SEC. 802. ENFORCEMENT OF SECURITY INTERESTS. 

8 Section 803(6) of the Fair Debt Collection Practices 

9 Act (15 U.S.C. 1692a(6)) is amended by striking ‘‘For 

10 the purpose of section 808(6), such term also includes any 

11 person who uses any instrumentality of interstate com12 merce or the mails in any business the principal purpose 

13 of which is the enforcement of security interests.’’. 

14 TITLE IX—EFFECTIVE DATE 

15 SEC. 901. EFFECTIVE DATE. 

16 This Act and the amendments made by this Act shall 

17 take effect on the date that is 180 days after the date 

18 of enactment of this Act. 

Æ 


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