The CFPB Issues Final Rule of Credit Reporting Medical Debt January 7, 2025, amends Regulation V and prohibits creditors from considering medical information in making credit eligibility determinations, except in extremely limited circumstances. The Final Rule also prohibits consumer reporting agencies from furnishing reports containing medical debt information, except under limited circumstances. For a copy of the final rule click here.
Cornerstone Credit Union League and Consumer Data Industry Association have filed a lawsuit on January 7, 2025, against the Consumer Financial Protection Bureau seeking to halt the implementation of the final rule on medical debt reporting.
The lawsuit was filed shortly after the CFPB published the final Rule. Unsurprisingly, the lawsuit has been brought in United States District Court for the Eastern District of Texas which is located within the Fifth Circuit —a circuit which has historically been hostile to the CFPB’s initiatives. The Complaint alleges that the CFPB violated various provisions of the Administrative Procedures Act in promulgating the final rule.
For a copy of the lawsuit click here.
ACA Files Injunction Seeking Delay in Enactment in CFPB’s Final Medical Debt Rule
As part of ACA International’s advocacy on behalf of members to push back on the Consumer Financial Protection Bureau’s harmful and flawed medical debt credit reporting final rule, ACA and co-plaintiff Specialized Collection Systems Inc. filed on January 24, 2025, a preliminary injunction (PDF) in the lawsuit seeking to prevent the rule from going into effect in March.
The preliminary injunction was filed in the U.S. District Court for the Southern District of Texas, Houston Division.
ACA and the plaintiffs also filed several declarations of support for the preliminary injunction from Jennifer Whipple, president of Collection Bureau Services Inc.; Anita Manghisi, owner of Independent Recovery Resources Inc.; Megan Hebert, president and CEO of co-plaintiff Specialized Collection Systems Inc.; Andrew Nigrinis, economist at Legal Economics LLC who also conducted an economic analysis of the CFPB’s rule in the proposal stages; and ACA CEO Scott Purcell.
ACA is awaiting a response from the CFPB and a possible hearing on the preliminary injunction request.
In a related matter, the Consumer Data Industry Association and Cornerstone Credit Union League are also challenging the ruling. A Feb. 10 hearing has been set for their motion for a preliminary injunction.