Debt Collection from the Deceased
TheStreet.com reports that the FTC has loosened its interpretation of debt collection laws to allow collectors to contact not just a deceased debtor’s spouse, but also his or her friends or anyone else who might know who was handling the estate. The new policy “encourages” — but does not require — debt collectors to make a good faith effort to do record searches, such as calling the probate court where the deceased resided before calling anyone the deceased knew to point out that he or she had “outstanding bills.” (The FTC believes that the term “bills” lack the stigma of “debts,” but what difference does it make.) The FTC rejected requests to impose a cooling-off period to prevent debt collection calls to family members immediately following the death.
The Consumer Financial Protection Bureau — newly created by the Dodd-Frank Act — has the authority to enact rules under the Fair Debt Collection Practices Act. What steps should it take to codify, or strengthen or weaken, FTC interpretations of the law?