AP Details Growth of State ARM Regulation and Consumer Woes

Get ready to see an article on the debt collection industry in your local newspaper today.

The Associated Press sent an article out over its wires Thursday afternoon that was innocuously titled, “States raise limits on creditors as debtors squirm.” But the main focus of the article is the growing trend of individual states passing laws targeting the accounts receivable management industry that supersede the Fair Debt Collection Practices Act (FDCPA).

The AP article notes that several states or local government entities have already proposed or passed laws stricter than the FDCPA, with most focusing on debt purchasing. More states are expected to follow suit.

The list of states – North Carolina, Idaho, Colorado, New York, Arkansas, Maryland, New Jersey and Massachusetts, along with New York City – is not new to the ARM industry. Many of the changes have been detailed in debt collection media, including insideARM: “ARM Industry Discusses Collection Law Changes in North Carolina,” Sept. 2; “NYC Collection Law Could Signal Problems for the ARM Industry,” April 17; “NJ Bill Would Require Collectors to Send Copies of FDCPA to Debtors,” April 20; “Massachusetts Toughens Rules for Small Claims Collection Lawsuits,” Aug. 12. We’ve even covered some that the AP missed: “Oregon Passes Bill Allowing State AG to Sue Debt Collection Agencies,” April 6.

But that’s hardly the point. What the AP notes, and what professionals in the ARM industry already know, is that the regulatory and legislative tide on nearly every level of government is turning against debt collectors, as if it hadn’t already. And presenting the same basic journalistic formula isn’t helping matters.

In its article, the AP makes heavy use of the “poor consumer” anecdote, giving three paragraphs of space to the story of a North Carolina woman that prompted her states’ tough new measures. The article gives one single sentence to an ACA spokesperson for the ARM industry perspective…near the bottom of the story.

I will say that we were personally pleased with one aspect of the article: the AP cites a survey conducted by Kaulkin Ginsberg, our sister company. In actuality, the survey cited is the insideARM Quarterly Confidence Survey. So thanks, AP. But other than that, we feel that reporting on these new laws should focus on the unintended consequences and additional burdens on jobs that the rules will present.