CFPB Issues Consent Order Against Third-Party Debt Collector

On December 15, 2023, the CFPB announced​ that it entered into a consent order​ with a medical debt collector resolving allegation​s that the debt collector tried to collect unverified medical debts after consumers disputed the validity of those debts.

The CFPB alleges that the company failed to conduct reasonable investigations of disputed debts and failed to inform consumer reporting companies that certain information​ was being disputed in violation of the Fair Credit Reporting Act.  The company also allegedly violated the Fair Debt Collection Practices Act by continuing to attempt to collect disputed debts without obtaining the requisite substantiating documentation.

Under the CFPB’s order, the company will shut down permanently and is banned from participating in or assisting others in any debt collection activities.  The company must also tell consumer reporting companies to delete all information it previously furnished and pay a fine of $95,000.