Public Comments

July 22, 2020
To Whom it May Concern:
Thank you for the opportunity to submit comments to the Consumer Financial Protection Bureau (CFPB)
in regard to the survey you will be sending for additional information on the proposed model notice.
This is a fantastic opportunity you are giving patients, one of the three stakeholders (patients, health
systems, and collection agencies) that the proposed model notice impacts. The American Association of
Healthcare Administrative Management (AAHAM) implores the CFPB to also give our members the same
opportunity for comments to ensure the proposed model notices meet the needs of all stakeholders.
Healthcare billing can be a complex and challenging process for patients to understand. According to
CFPB’s own study, approximately 9.5 percent of credit reports, nearly one in five, contain one or more
medical collections.i This sheer volume means that one in five of the surveys, discussing the proposed
model notice, will be for medical collection, for which the needs differ significantly from other collection
efforts. AAHAM’s members work directly with our partners, the collection agencies, to ensure the
statements provided to patients are correct and include relevant information from which to make an
informed decision regarding payment options.
AAHAM’s member needs include:
1. The complexity of healthcare that we reference above comes from multiple episodes of care
including, multiple family members as patients, physician charges that are different from the
facility, and different dates of services, which unlike utilities, credit cards, and cell phone bills,
need to be itemized for the patients who are the payers. We also believe the healthcare
uniqueness of adding insurance information, such as adjustments and payments made by
insurance carriers, to the proposed model notice will support a better-informed patient.
2. AAHAM believes that the CFPB should allow our collection agency partners to add additional
language to the proposed model notice as there is a requirement under the Affordable Care Act
501rii of conspicuous written notice that financial assistance, or the ability for patients to apply
for free care, may be available. This is in the best interest of all stakeholders.
3. AAHAM also implores the CFPB, just as you all are requesting in item d, “ways to minimize the
burden of the collection of information on respondents, including through the use of automated
collection techniques or other forms of information technology,” that our partners, the
collection agencies, be able to minimize the financial burden and use multiple communication
media, such as emails and text, to deliver the proposed model notices to our patients.
4. Finally, the proposed model notice needs to balance all resolution options for our patients, but
the focus should be on repayment. Currently, we believe the focus of the proposed model is on
disputes. The proposed model should be designed to address the majority, which are payments,
and include a sub-section addressing the minority, which are disputes.

11240 Waples Mill Road, Suite 200

Fairfax, VA 22030 www.aaham.org

ABOUT AAHAM
The American Association of Healthcare Administrative Management (AAHAM) is a national professional
association of thirty chapters and over 3,000 healthcare revenue cycle professionals from hospitals,
clinics, billing offices, allied vendors, physicians and multi physician groups. AAHAM members direct the
activities of the thousands of people employed in the healthcare industry.
AAHAM is the preeminent professional organization for revenue cycle professionals and is known for its
prestigious certification and educational programs; professional development of its members is one of
the primary goals of the association. AAHAM actively represents the interests of its members through a
comprehensive program of legislative and regulatory monitoring and participation in industry groups.
For more information on AAHAM and its programs, please visit www.aaham.org or contact AAHAM,
703.281.4043.
Sincerely,

Lori M. Sickelbaugh, CRCE
President
ii

https://files.consumerfinance.gov/f/201412_cfpb_reports_consumer-credit-medical-and-non-medicalcollections.pdf
ii
https://www.irs.gov/charities-non-profits/financial-assistance-policies-faps

11240 Waples Mill Road, Suite 200

Fairfax, VA 22030 www.aaham.org

July 29, 2020
VIA ELECTRONIC DELIVERY TO REGULATIONS.GOV
Comment Intake
Bureau of Consumer Financial Protection
1700 G Street NW
Washington, DC 20552
Re:

“Debt Collection Validation Notice Qualitative Testing, Docket No. CFPB2020-0024

Dear Director Kraninger and CFPB Staff:
ACA International (“ACA”), the Association of Credit and Collection Professionals, submits
these comments in response to the Bureau of Consumer Financial Protection’s (“Bureau” or
“CFPB”) “Debt Collection Validation Notice Qualitative Testing” under the Generic
Information Collection Plan entitled, “Generic Information Collection Plan for the Development
and Testing of Disclosures and Related Materials.”
I.

BACKGROUND ON ACA INTERNATIONAL

ACA International (ACA) is the leading trade association for credit and collection professionals.
Founded in 1939, and with offices in Washington, D.C. and Minneapolis, Minnesota, ACA
represents approximately 2,500 members, including credit grantors, third-party collection
agencies, asset buyers, attorneys, and vendor affiliates in an industry that employs more than
230,000 employees worldwide. Given its longstanding history and broad membership, ACA is
uniquely positioned to assist the Bureau with information gathering related to debt collection, as
well as to collaborate with the Bureau on how its proposed policies and regulations will impact
the credit and collection industry.
ACA members include the smallest of businesses that operate within a limited geographic range
of a single state, and the largest of publicly held, multinational corporations that operate in every
state. The majority of ACA-member debt collection companies, however, are small businesses.
As part of the process of attempting to recover outstanding payments, ACA members are an
extension of every community’s businesses. ACA members work with these businesses, large
and small, to obtain payment for the goods and services already received by consumers. In years
past, the combined effort of ACA members has resulted in the annual recovery of billions of

dollars. This savings is returned to and reinvested by businesses. This allows small businesses
and large employers, to limit losses on the financial statements of those businesses. Without an
effective collection process, the economic viability of these businesses and, by extension, the
American economy in general, is threatened. Recovering rightfully-owed consumer debt enables
organizations to survive, helps prevent job losses, keeps credit, goods, and services available,
and reduces the need for tax increases to cover governmental budget shortfalls.
The role of the accounts receivable management (ARM) industry currently is more important
than ever during these unprecedented and challenging times for our country because of COVID19. ACA members’ clients, consisting of medical providers, hospitals, community financial
institutions, and a multitude of small and large businesses in both the public and p rivate sectors
throughout the country are providing valuable goods and services. They need the ARM industry
to stay afloat. One thing is clear, part of our economy is functioning in a healthy way, and part is
not. ACA members have the expertise to address issues that consumers have in both parts of the
economy, which, in turn, helps creditors, consumers, and the economy as a whole. Every
American family stands to lose $709 per year due to the increase in the cost of goods and
services if ACA members cannot return the $90 billion back to creditors, according to a recent
study.1
Importantly, ACA members are committed to fair, reasonable, and respectful practices and take
their obligations in collecting debt very seriously. As legitimate credit and collection
professionals, ACA members play a key role in helping consumers fulfill their financial goals
and responsibilities while facilitating broad access to the credit market.
II.

Relevant Questions Posed

The CFPB notes that it plans to conduct cognitive interviews to assess the effectiveness and
validate the performance of the Bureau's model debt collection validation notices. It states that it
will collect information on how consumers locate and use information in the model no tice
including:
(1) Whether the consumer can locate and use important information effectively, such as
information about the debt, information about the consumer's rights, and information about how
the consumer may respond if they so choose; and
(2) How consumers view and respond to paper and electronic versions of the model validation
notice.
III.

ACA’s Comments

Consumer testing can be a helpful aspect of developing policymaking. However, there are also
many other aspects surrounding the testing of any model validation notice that the Bureau must
consider, including applicable state laws, electronic alternatives, predatory litigation in this area
that targets highly technical violations (which can have little to no impact on consumers), and the
1

2020 State of The Industry Report, available at https://www.acainternational.org/kaulkin-ginsberg.

2

host of issues outlined in ACA’s Comments on the Notice of Proposed Rulemaking (NPRM) to
implement the Fair Debt Collection Practices Act (FDCPA).2 The CFPB’s request for comment
does not include the model validation notice to be tested, so it would be impossible to provide
substantive comments. However, if the model notice is the same as what was included in the
FDCPA NPRM, we ask that the Bureau consider our previous lengthy comments outlining
improvements that can be made.
In general, greater transparency about why data is being collected and how it is being used in the
rulemaking process is critical. To that end, not knowing for certain exactly how this new model
validation notice to be tested will be included, or if it will be included, in the forthcoming final
rule, it is impossible at this time to determine or comment on whether its use will comply with
Administrative Procedures Act requirements.3
***
ACA appreciates the opportunity to provide comments.

Sincerely,

Leah Dempsey
Vice President and Senior Counsel, Federal Advocacy
Phone: 202-810-8901
Dempsey@acainternational.org

2

Comments of ACA International in response to the Notice of Proposed Rulemaking (NPRM) to implement the
Fair Debt Collection Practices Act (FDCPA), available at https://www.acainternational.org/assets/comments/acacomment-cfpb-reg-f-9.17.19.pdf. (Sep. 17, 2019).
3 5 U.S.C. § 551(1).

3

July 29, 2020
By Electronic Submission
Comment Intake
Bureau of Consumer Financial Protection
1700 G Street NW
Washington, DC 20552
RE: Americollect Comment in Response to the Notice and Request for Comment regarding “Debt
Collection Validation Notice Qualitative Testing” (Docket No. CFPB-2020-0024).
Dear Director Kraninger,
Americollect appreciates the opportunity to submit our comments in response to the notice and request
for comment regarding the “Debt Collection Validation Notice Qualitative Testing” (Docket No. CFPB2020-0024). Particularly, Americollect is providing its comments in response to the Bureau’s request for
comment on: (1) “Whether the collection of information is necessary for the proper performance of the
functions of the Bureau, including whether the information will have practical utility”; and (2) “Ways to
enhance the quality, utility, and clarity of the information to be collected.” 85 FR 38870 (June 29, 2020).
The collection of information in unnecessary and will have no practical utility because the model
notice should be updated prior to further testing.
The proposed B3 model notice was built for one creditor when the majority of the collection agencies
are regional players for many small businesses, meaning a notice may include several debts for different
creditors or, as in the case of healthcare, several different line items of debts with different account
numbers. The model B3 notice has many elements on the front page making it appear “busy” and may
overwhelm the consumer. Ultimately, for consumers with four or more accounts, the tabular format in
the B3 notice will become especially crowded and the consumer will have a hard time differentiating
each account.
The collection of information would be more practical if a more easily readable notice for the
consumer with a page regarding the account details and payment information and a second page
providing their rights (state and federal) as well as additional room to outline any dispute was also
tested and responses were compared to the B3 Model notice.
At a minimum, when collecting information, a B3 Model notice with at least four different debts or
account numbers should be tested to ensure that it is not confusing to consumers.

Po Box 1566 • 1851 S. Alverno Rd. • Manitowoc, WI 54221
Phone: 920-682-0311 • Toll Free: 1-800-838-0100 • Fax: 920-682-0313 • www.americollect.com • info@americollect.com

Again, Americollect appreciates the opportunity to provide comments.
Sincerely,
Jenna Leigh Guyton
Jenna Leigh Guyton
General Counsel
Americollect, Inc.

Po Box 1566 • 1851 S. Alverno Rd. • Manitowoc, WI 54221
Phone: 920-682-0311 • Toll Free: 1-800-838-0100 • Fax: 920-682-0313 • www.americollect.com • info@americollect.com

The Center for Responsible Lending

Comments to the Consumer Financial Protection Bureau
Debt Collection Validation Notice Qualitative Testing
Docket No. CFPB-2020-0024
OMB Control Number: 3170-0022
July 29, 2020

Submitted electronically to https://www.regulations.gov
Comment Intake Consumer Financial Protection Bureau
1700 G Street NW Washington, DC 20552
1

The Center for Responsible Lending (CRL) appreciates the opportunity to submit comments on
the Consumer Financial Protection Bureau’s proposed Debt Collection Validation Notice
Qualitative Testing (Proposal).
CRL is a non-profit, non-partisan research and policy organization that works to ensure a fair,
inclusive financial marketplace. CRL’s work focuses on those who may be marginalized or
underserved by the existing financial marketplace, people who often are targeted for unfair and
abusive financial products that leave them worse off. This includes people of color, women, rural
residents and low-wealth families and communities. CRL is an affiliate of Self-Help, one of the
nation’s largest nonprofit community development financial institutions. Over 37 years, SelfHelp has provided over $7 billion in financing through 146,000 loans to homebuyers, small
businesses, and nonprofits. It serves more than 145,000 mostly low-income members through 45
retail credit union locations in North Carolina, California, Florida, Greater Chicago, and
Milwaukee.
Introduction
We support the CFPB’s decision to conduct additional testing of the validation notice it has
proposed and agree that such research is a necessary part of the Bureau’s debt collection
rulemaking. As discussed below, we believe that the utility of the research will depend upon: the
criteria used to select individuals to participate in the research; and the scope of the issues that
are probed through the research. This comment is thus offered to address ways to “enhance the
quality, utility, and clarity of the information to be collected.”
For the reasons discussed below, CRL urges the Bureau to withdraw the Proposal for limited
qualitative testing and to submit a revised proposal with a more robust research design to answer
the important empirical questions posed by the Bureau’s 2019 Notice of Proposed Rulemaking
(NPRM) and the comments thereon.
I.

We urge the Bureau to Increase its Sample Size.

The Request for Approval indicates that the Bureau intends to conduct between 40 and 60
interviews. That coupled with the 30 cognitive and 30 user experience interviews conducted in
2014-2015, albeit on an earlier version of the validation notice, means that at most the Bureau
will be basing its decisions on a convenience sample of only 120 individuals. That is a miniscule
sample for creating a notice which, by the Bureau’s own estimate, may be used 140 million times
each year, and is critical to conveying important information about the debt to consumers. We
recommend a substantial increase in the sample size to produce more “robust and reliable”
evidence, which is the standard that the Bureau holds for itself in other contexts.

2

II.

The Bureau Should Strongly Consider Altering its Selection Criteria Such That
Communities of Color Who Disproportionately Experience Debt Collection Are
Represented Adequately.

In order for the research to be useful in determining whether the proposed validation notice will
be effective in achieving its objectives and the purposes of the Fair Debt Collection Practices Act
(“FDCPA”), it is essential that the research be conducted with participants who are
representative of those who are likely to be subject to third-party debt collection, and thus likely
to be exposed to validation notices. That is especially important in light of the
unrepresentativeness of the research the Bureau has conducted to date as part of this rulemaking
as discussed below.
At the threshold, CRL questions the Bureau’s intention, as reflected in the Request for Approval
that accompanies the Proposal, to devote up to one-third of the testing among participants who
have not had any experience with debt collection in the prior two years. We recognize, of course,
that in any given time period some consumers will be contacted by a debt collector—and thus
exposed to a validation notice—for the first time. But, given the small number of interviews the
Bureau plans to conduct, we believe the research would be more valuable if it were limited to
those who have actually had debts that were subject to collection within the past two years.
However, if the Bureau believes it is important to conduct “non-collection sessions,” we
recommend that the participants for those session be screened so as to identify individuals who
are likely to be subject to debt collection in the future. For example, the Bureau could screen to
identify individuals who are struggling to make ends meet, especially those who currently have
past due accounts and are not confident in their ability to repay those debts.
Of particular importance, for this research to be useful the Bureau must assure robust
participation of Black and Latinx individuals. The Bureau’s landmark Survey of Consumers
Views on Debt found that 44% of Black people had experienced debt collection activity in the
prior year, a rate 50% higher than among white individuals, and that the rate for Latinx people
was 25% higher than for non-Hispanic white individuals. Thus, a representative sample would
include an over-representation of Black and Latinx individuals relative to their percentage in the
overall population. Yet, in the quantitative research the Bureau conducted regarding time-barred
debt, Black and Latinx individuals actually were underrepresented. The Bureau should not
repeat that error in this round of research.
Moreover, in the cognitive testing that the Bureau conducted in 2014—almost five years prior to
releasing the proposed debt collection rule—only two Latinx people were included among the 30
individuals interviewed. The Bureau did not release demographic information regarding the 30
participants in the user experience testing. Even in the testing conducted in Las Vegas – a city
that is roughly one-third Latinx – only one of the test participants was Latinx It is even more
important now than it was five years ago to assure robust representation of Latinx individuals in
the Bureau’s testing given that the Bureau’s 2019 NPRM – in contrast to the concepts that were
the subject of the 2014 research and were included in the Outline of Proposals Under
Consideration that the Bureau released in 2016 – would permit the validation notice to be given
almost entirely in English. A key empirical question posed by the proposal is whether
individuals for whom Spanish is their primary language and with limited English proficiency
will find, let alone make use of, the option to request a Spanish translation. That question cannot
3

be answered without including a meaningful number of such participants in the cognitive
interviews. To do so, a question about language preference should be added to the Screener and
the Bureau should instruct the contractor to screen on that basis.
Finally, we note, as the Bureau did in its debt collection proposal, that “circuit courts have held
… that the least sophisticated consumer standard applies to a consumer’s understanding of a
validation notice.”1 That means that the utility of the research in answering legally relevant
questions will depend on the Bureau’s ability to assess the extent to which unsophisticated
consumers comprehend the validation notice. Although sophistication, of course, cannot be
directly measured, the Bureau could select participants based on objective factors that may be
correlated with the degree of sophistication such as levels of education.
III.

The Bureau Should Consider Expanding the Scope of its Research in Light of
the 2019 NPRM.

The Proposal identifies two questions that the Bureau intends to research: “(1) Whether the
consumer can locate and use important information effectively…” and “(2) How consumers view
and respond to paper and electronic versions of the model validation notice.” CRL submits that
this limited agenda ignores the most important empirical questions posed by the Bureau’s
validation proposal and by the comments that CRL and other consumer advocates have
submitted in response to the Bureau’s 2019 NPRM with respect to that proposal. We discuss,
below, a number of such questions.
A. The Effect of Electronic Delivery Impacts Whether Consumers Can Locate and Use
Validation Notice Information Effectively.
The question of whether consumers can “locate and use important information effectively”
necessarily presupposes that consumers will actually see the information contained in the
validation notice. Yet, the Bureau has proposed to allow these notices to be sent electronically,
without compliance with the E-SIGN Act, by sending an e-mail or a text message with a
hyperlink to an e-mail address or phone number that the creditor or a prior debt collector could
have used under the E-SIGN Act. As discussed in the comments that CRL and other advocates,
including the National Consumer Law Center (NCLC) submitted, that proposal raises a myriad
of concerns, including the potential that such electronic notifications will end up in a spam folder
or the inbox of an inactive e-mail account, or will be sent to a phone number that no longer
belongs to the consumer. Those are empirical questions that the Bureau should research, but not
ones that can be answered through consumer interviews.
However, as also discussed in the comments, even if an e-mail or text is sent to a consumer’s
current e-mail address or current mobile phone number, there is a substantial risk that a
consumer receiving an e-mail from a debt collector who is new to the consumer—which is a
precondition for sending the validation notice—will ignore that e-mail or text altogether or will
open the e-mail/text, but decline to click on the hyperlink to avoid potential malware. Indeed, at
least some debt collectors might deliberately attempt to structure their e-mails in such a way as to
engender such a (non-)response in order to minimize the number of disputes resulting from the
1

83 Fed. Reg. 23274, 23282-23283 n.84 (May 21, 2019).

4

validation notice. The questions of (i) whether consumers will open emails from unknown debt
collectors and (ii) whether consumers will click on hyperlinks to get to a validation notice, are
questions that could be explored through well-structured consumer testing. It is imperative that
the Bureau do so for this research to have practical utility.
B. The Bureau’s Proposed Research Protocol Should Better Test the Ability of
Consumers to Recognize Debts, Especially in Light of the Bureau’s 2019 NPRM
Concerning Itemization Dates.
As the Bureau stated repeatedly in the 2019 NPRM, the purpose of the validation notice is to
“help a consumer recognize a debt and determine whether the amount of a debt is accurate.”2 In
principle, then, a key research question should be whether the proposed validation notice
achieves this objective. Yet, in the Moderator’s Guide accompanying this proposal, the
participants are given a notice and told to assume “you owe this debt”; the Guide explains that
the purpose of this instruction is to “reduce participant ambiguity in how to respond.” But, one
goal of the research should be to determine whether, in fact, the proposed validation notice
reduces ambiguity – not to assume it away.
This limitation is particularly troubling in light of the comments the Bureau has received on its
proposal. The Bureau has proposed to require that the validation notice include an itemization of
the amount owed. However, the itemization required is based upon the “itemization date,” and
under the Bureau’s proposal debt collectors have a choice of itemization dates. As is discussed
in detail in the comments on the 2019 NPRM, at least some of the proposed itemization dates—
such as the date that the original creditor removed the debt from the creditor’s balance sheet as
an asset (i.e. the charge-off date)—are almost surely opaque for most consumers. For these
reasons, the NCLC in its comments urged the Bureau to “conduct thorough and rigorous
consumer testing to determine what dates will help consumers and whether use of any of the
proposed itemization dates helps consumers or causes confusion.” The Bureau’s Proposal
ignores that recommendation.
Determining whether the alternative itemization dates permitted by the proposal are meaningful
to consumers is admittedly challenging, at least so long as the research protocol uses validation
notices based upon hypothetical debts of hypothetical consumers. However, the Bureau’s
researchers could potentially design a research protocol to address this challenge, such as by
obtaining consumer reports for the participants with their authorization, and using the
information in those reports to construct validation notices for real debts using various proposed
itemization dates. In any event, the research surely could explore with those consumers who have
had recent debt collection experience, their memory about the various potential itemization dates
to assess which would be most meaningful, constituting yet another reason to focus the research
among those with such experience.

2

84 Fed. Reg. 23274, 23341 (May 21, 2019).

5

C. The Bureau Should Consider Testing Alternatives to Improve Clarity Given the
Validation Notice’s Purpose to Convey Important Information to the Least
Sophisticated Consumer.
The comments on the 2019 NPRM identified a number of areas in which the proposed validation
notice risks creating a false or misleading impression and recommended that the Bureau conduct
testing to develop revised language to mitigate these risks. For example, NCLC’s comment
noted that specifying the ending date of the validation period, coupled with a statement of the
consumer’s right to dispute the debt during that period could leave consumers with the false
impression that disputes cannot be submitted after that date or that such disputes would have no
legal consequence. NCLC likewise noted that specifying that the consumer should submit a
dispute in writing to trigger the collection pause could leave consumers with the false impression
that oral disputes have no legal consequence.
Rather than designing the research to explore ways to improve upon its proposed validation
notice in light of these concerns, the Bureau’s research plan appears to take that proposed notice
as a given and asks only whether it is adequate. But, more than minimal adequacy is required—
the validation notice must be clearly and effectively conveyed to the least sophisticated
consumer so that they is certain of their rights.3 Moreover, merely striving for adequacy negates
the very purpose of the notice-and-comment process which is designed to elicit
recommendations for ways to improve on what has been proposed.
IV.

Conclusion

For all of the above stated reasons, CRL urges the Bureau to withdraw the Proposal for limited
qualitative testing and to submit a revised proposal with a more robust research design to answer
the important empirical questions posed by the Bureau’s proposed rule and the comments
thereon.

See Russell v. Equifax A.R.S., 74 F.3d 30, 35 (2d Cir. 1996) (“A notice is overshadowing or
contradictory if it would make the least sophisticated consumer uncertain as to her rights. It is not enough
for a debt collection agency simply to include the proper debt validation notice in a mailing to a
consumer—Congress intended that such notice be clearly conveyed.”); Wilson v. Quadramed Corp., 225
F.3d 350, 354 (3d Cir. 2000), as amended (Sept. 7, 2000) (“Thus, in order to comply with the
requirements of section 1692g, more is required than the mere inclusion of the statutory debt validation
notice in the debt collection letter-the required notice must also be conveyed effectively to the debtor”)
(citing Miller v. Payco–General American Credits, Inc., 943 F.2d 482, 483–84 (4th Cir.1991)).
3

6

COMMENTS
to the
Consumer Financial Protection Bureau
on its
Debt Collection Validation Notice Qualitative Testing
OMB Control Number: 3170–0022
Docket No. CFPB-2020-0024
85 Fed. Reg. 38,870

By the
National Consumer Law Center
On behalf of its low-income clients

July 29, 2020

1. Introduction
The Consumer Financial Protection Bureau (“CFPB”) estimates that 140 million
validation notices are sent annually.1 The validation notice is a critical notice to
consumers that informs them about the alleged debt and provides information about
some critical debt collection rights, such as the right to dispute the debt.
As announced in the Federal Register, the CFPB plans “to conduct cognitive interviews
to assess the effectiveness and validate the performance of the Bureau’s model debt
collection validation notices.”2 The focus of the qualitative testing is:
(1) Whether the consumer can locate and use important information effectively,
such as information about the debt, information about the consumer's rights, and
information about how the consumer may respond if they so choose; and
(2) How consumers view and respond to paper and electronic versions of the
model validation notice.3
We applaud the CFPB for taking a data-driven approach to assess the effectiveness of
the model validation notices and to ensure that consumers comprehend their rights
pertaining to debt collection. Consumer testing is a critical step to ensure that the CFPB
promulgates the most effective regulations in its ongoing debt collection rulemaking.4
However, the CFPB needs to make significant improvements to the proposed testing to
maximize the effectiveness of the proposed qualitative testing and to ensure
comprehension of this critical notice. The following are our recommendations for how
“to enhance the quality, utility, and clarity of the information to be collected.”5

Proposed Rules, Debt Collection Practices (Regulation F), 84 Fed. Reg. 23,274, 23,389 (May 21,
2019) [hereinafter Proposed Rules].
1

Agency Information Collection Activities: Consumer Request, 85 Fed. Reg. 38,870 (June 29,
2020).

2

3

Id.

4

See Debt Collection (Regulation F), 78 Fed. Reg. 67,848 (Nov. 12, 2013).

Agency Information Collection Activities: Consumer Request, 85 Fed. Reg. 38,870 (June 29,
2020).

5

2

2. The Model Validation Notice Must Be Comprehensible to the Least Sophisticated
Consumer.
Assessing the least sophisticated consumer’s ability to comprehend the model
validation notices is critical. To accomplish the consumer protection purpose of the Fair
Debt Collection Practices Act (FDCPA), the courts apply a “least sophisticated”6 or
“unsophisticated”7 consumer standard to analyze many of the protections of the
FDCPA.8 Thus, in order to develop model validation notices, the CFPB needs to analyze
whether such notices are comprehensible to the least sophisticated consumer. Testing
results will not show whether the model notice meets the FDCPA’s standards unless the
test is designed to assess the proposed validation notices from the perspective of the
least sophisticated consumer.
Accordingly, the CFPB should ensure that the testing pool includes a large enough
sample of unsophisticated consumers to produce valid results for this group. Factors
such as education level and general financial literacy could be used as proxies for
consumer sophistication when assessing the validation notice. The CFPB should report

See, e.g., Powell v. Palisades Acquisition XVI, L.L.C., 782 F.3d 119, 126 (4th Cir. 2014); Crawford
v. LVNV Funding, L.L.C., 758 F.3d 1254, 1258 (11th Cir. 2014); Tourgeman v. Collins Fin. Servs.,
Inc., 755 F.3d 1109, 1117-18 (9th Cir. 2014), as amended on denial of reh’g and reh’g en banc (Oct. 31,
2014); Caprio v. Healthcare Revenue Recovery Group, L.L.C., 709 F.3d 142, 149 (3d Cir. 2013);
Fed. Home Loan Mortg. Corp. v. Lamar, 503 F.3d 504, 509 (6th Cir. 2007); Russell v. Equifax
A.R.S., 74 F.3d 30, 34 (2d Cir. 1996).

6

See, e.g., Pollard v. Law Office of Mandy L. Spaulding, 766 F.3d 98, 103 (1st Cir. 2014);
McMahon v. LVNV Funding, L.L.C., 744 F.3d 1010, 1019 (7th Cir. 2014); Peters v. Gen. Serv.
Bureau, Inc., 277 F.3d 1051, 1055 (8th Cir. 2002).
7

The CFPB recognizes that the courts have applied a “least sophisticated” or “unsophisticated”
consumer standard in interpreting claims under §§ 1692e and 1692f. See Proposed Rules, 84 Fed.
Reg. at 23,283.

8

Additionally, courts have applied a least sophisticated consumer standard when
analyzing claims under § 1692g. See, e.g., Sims v. GC Servs. L.P., 445 F.3d 959, 963 (7th Cir.
2006) (“In reviewing the collection letters to determine whether they violate the FDCPA, we
view the letters from the ‘standpoint of the so-called unsophisticated consumer or debtor.’”
(citation omitted)); Graziano v. Harrison, 950 F.2d 107, 111 (3d Cir. 1991) (“Statutory notice
under the Act is to be interpreted from the perspective of the ‘least sophisticated debtor.’”);
Swanson v. Southern Oregon Credit Serv., Inc., 869 F.2d 1222, 1225 (9th Cir. 1988) (“In this
circuit, the impact of language alleged to violate section 1692g is judged under the ‘least
sophisticated debtor’ standard.”).

3

results of its consumer testing that are broken out by these categories to demonstrate
that the potential disclosure is intelligible to the least sophisticated consumer.
3. The CFPB Should Increase Testing of the Proposed Model Validation Notice.

3.1 Testing of the Model Validation Notice To Date Has Been Inadequate.
To date, the CFPB has not engaged in sufficient testing of the proposed model
validation notices. Previously, the CFPB tested model validation notices with only 30
consumers for cognitive testing and 30 consumers for usability testing.9 We have serious
concerns about the ability of such limited testing to adequately evaluate comprehension
of the proposed model validation notices. This is particularly true given that all testing
took place prior to the release of the SBREFA Outline in July 201610 even though the
model validation notice changed from the SBREFA Outline11 to the Proposed Rules
released in May 2019.12
Currently, the CFPB is planning to engage in quantitative testing of the model
validation notices with only 40 to 60 respondents.13 While any additional testing
represents a step in the right direction, these 40 to 60 respondents will not cure the
current inadequacy of consumer testing of the proposed model validation notices.

3.2 The CFPB Should Expand the Proposed Qualitative Testing.

Proposed Rules, 84 Fed. Reg. at 23,279. We note that there were additional focus group
conversations discussing disclosures more generally that took place before the cognitive and
usability studies, but it is not clear how many consumers were involved in those conversations.
See id.

9

10

Proposed Rules, 84 Fed. Reg. at 23,279.

Consumer Fin. Prot. Bureau, Small Business Review Panel for Debt Collector and Debt Buyer
Rulemaking: Outline of Proposals Under Consideration and Alternatives Considered (July 28,
2016), available at
https://files.consumerfinance.gov/f/documents/20160727_cfpb_Outline_of_proposals.pdf.
11

12

Proposed Rules, 84 Fed. Reg. at 23,409.

Consumer Fin. Prot. Bureau, Request for Approval Under the “Generic Information Collection
Plan for the Development and Testing of Disclosures and Related Materials” available at
regulations.gov as a related material for CFPB-2020-0024.
13

4

We urge the CFPB to conduct additional consumer testing in the current round of
proposed qualitative testing. A larger group of respondents will enable the CFPB to
ensure that there is a sufficiently diverse pool of respondents and that there are
sufficient respondents from each subgroup to create statistical power to allow for
comparisons of key subgroups.
Currently, the CFPB states that:
The contractor will select respondents from a variety of backgrounds,
representing various ages, genders, races/ethnicities, education levels, and
incomes. Additionally, the contractor will aim to recruit such that one-third of
the sample is comprised of consumers without debt collection experience and
approximately two-thirds of the sample is comprised of consumers who have
had a debt in collection in the past two years. The contractor will also recruit
respondents who have had a variety of types of debts (e.g., medical debt, student
loan debt, etc.).14
We applaud the plan to include a diverse array of respondents. However, it appears
impossible to achieve subgroups of sufficient size across all of these categories with
only 40 to 60 qualitative interviews. Moreover, this list does not even include the
additional variable – whether the respondent is first provided a paper-based or
electronic model validation notice15 – that will add further complexity to ensuring that
subgroups are of sufficient size.
The CFPB should interview a larger group of people to ensure comprehension by the
least sophisticated consumer. It is also important to increase the size of the testing pool
in order to identify any subgroups of respondents who lack comprehension, and to
ensure adequate representation by subgroups such as communities of color that are
disproportionately impacted by debt collection.16

14

Id.

15

Id.

See, e.g., Urban Institute, Debt in America: An Interactive Map (last updated Dec. 17, 2019)
available at https://apps.urban.org/features/debt-interactive-map; Consumer Fin. Prot. Bureau,
Consumer Experiences with Debt Collection: Findings from the CFPB’s Survey of Consumer
Views on Debt 17-18, 20-23, 25 (Jan. 2017) available at
https://files.consumerfinance.gov/f/documents/201701_cfpb_Debt-Collection-SurveyReport.pdf.
16

5

3.3 The CFPB Should Also Use Quantitative Testing of the Proposed Model
Validation Notices.
To test the proposed time-barred debt disclosures, the CFPB used a contractor to
conduct quantitative testing with 8,000 respondents. 17 This quantitative testing for the
time-barred debt disclosures included three general comprehension questions about
portions of the model validation notice. 18 This limited testing of content from the model
validation notice identified a significant comprehension problem with the model
validation notice – more than 40 percent of respondents incorrectly answered a question
about whom the consumer should pay.19
However, the CFPB has never conducted any quantitative testing designed to assess
comprehension of the model validation notices as a whole. Nor has it explained the
reason for using less robust testing for the model validation notices than it used for the
proposed time-barred debt disclosures, which would also appear on the model
validation notices for some consumers.
We urge the CFPB to rethink the role that quantitative testing should play in an analysis
of consumer comprehension of the proposed model validation notices. Such testing
may be particularly helpful to test different alternative language or layouts when
consumer testing shows that consumers do not understand particular content in the
proposed model validation notices.

3.4 The CFPB Should Test Comprehension of the Content of the Model Validation
Notice.
Whether through quantitative or qualitative testing, the CFPB should explore consumer
comprehension of the proposed model validation notices. In previous comments

Proposed Rules, Debt Collection Practices (Regulation F), 85 Fed. Reg. 12,672, 12,676 (Mar. 3,
2020).
17

Consumer Fin. Prot. Bureau, Disclosures of Time-Barred Debt and Revival: Findings from the
CFPB’s Quantitative Disclosure Testing 13-16 (Feb. 2020) available at
https://files.consumerfinance.gov/f/documents/cfpb_debt-collection-quantitative-disclosuretesting_report.pdf.
18

19

Id. at 13.

6

responding to the Proposed Rule,20 we identified aspects of the model validation notice
that are in need of additional testing. We summarize these here:
•

•

•
•
•
•
•

The CFPB should conduct consumer testing to answer questions about the
proposed itemization date:21
o Whether the proposed itemization dates and other potential itemization
dates like the date of default, tested one-by-one, enhance or impede
consumer understanding;
o What itemization date is most meaningful to consumers;
o Whether it is confusing to consumers to disclose an itemization date
without explaining what the date references, and whether an explanation
of the itemization date can dispel that confusion; and
o Whether the itemization of interest, fees, payments, and credits is more
helpful to consumers when using a particular itemization date.
The CFPB should conduct consumer testing to determine how to explain to
consumers that they can continue to dispute debts even after the validation
period has run.22
The CFPB should conduct consumer testing on whether consumers correctly
distinguish between the effect of an oral dispute and the effect of a written one.23
The CFPB should test whether having additional dispute prompts on the tear-off
portion would be helpful to consumers.24
The CFPB should conduct additional testing to identify whether combining a
dispute tear-off form and a payment coupon causes consumer confusion.25
The CFPB should conduct testing of the model validation notices with all of the
disclosures that the CFPB proposes to permit on the reverse side.26
The CFPB should conduct testing of translations of the model validation notices27
and translated statements to be included in the English language model
validation notices.28

National Consumer Law Center et al., Comments to the Consumer Fin. Prot. Bureau on its
Proposed Debt Collection Rule, Docket No. CFPB-2019-0022 (Sept. 18, 2019), available at
https://www.nclc.org/images/pdf/debt_collection/comments-debt-collection-sept2019.pdf.
20

21

Id. at 150.

22

Id. at 160.

23

Id. at 163.

24

Id. at 168-169.

25

Id. at 177.

26

Id.

7

Additionally, the proposed qualitative testing does not appear to include any questions
that address the collection of decedent debt. If the CFPB modifies the model validation
notices for collection of decedent debt, it will be important to separately test
comprehension of those modified validation notices. If the CFPB does not create
separate model validation notices for collection of decedent debt, it will be important to
test comprehension of the existing model validation notices when they are used to
collect decedent debt.
Finally, the proposed qualitative testing does not appear to include any questions that
address the collection of time-barred debts. As our forthcoming comments on the
proposed time-barred debt collection disclosures will discuss, additional testing is
needed to ensure comprehension by the least sophisticated consumer. Moreover,
qualitative testing presents an ideal opportunity to engage in more real world testing of
the proposed time-barred debt disclosure, including whether or not consumers identify
the relevant disclosure language without their attention being directed to the language
and the interaction between state or city time-barred debt disclosures and the CFPB’s
proposed time-barred debt disclosures.
As the CFPB tests for comprehension in all of these areas, it should build in time for
revisions. For example, if testing with a small group reveals comprehension problems,
the CFPB should build in time to revise and retest that language with a new batch of
respondents. In addition, the CFPB should build in time for as many rounds as are
needed until there is a high level of comprehension among all subgroups, including
unsophisticated consumers. The CFPB should publish detailed results of all testing,
including: the questions asked; the answers; respondent selection criteria; demographic
characteristics of the respondents; the dates of each round of testing; the model
validation notices used for each test; and the testing company’s analysis, including an
analysis by subgroups.

4. The CFPB Needs to Test All Delivery Methods for Validation Notices.

4.1 The CFPB Should Improve the Current Proposal for Testing the Electronic Notice.

27

Id. at 185.

28

Id. at 187.

8

The proposed qualitative testing would assess consumer comprehension of the
proposed model validation notice when presented as either a paper-based notice or an
electronic notice. The testing of the electronic notice appears to be designed to assess
comprehension of a validation notice received by email that will be presented via a
“digital form.”29 Rather than presenting the email notice to the respondent on a tablet or
laptop, the CFPB should instead email a copy of the validation notice to the consumer at
her or his actual email address. The CFPB could then evaluate the rate of messages that
are refused or sent to spam.30
A consumer selected to evaluate email delivery of the proposed model validation
notices should also be asked to bring the device from home that would most likely be
used to read the email, and then the consumer should be allowed to use that device
whether it is a laptop, tablet, or phone.31 This would allow the CFPB to test consumer
comprehension on a variety of different devices, including phones. Phones present
unique comprehension challenges due to the very different layout and the limited
amount of information that can be displayed on the screen at one time. In order to
develop a statistically significant sample, the CFPB should ensure that sufficient
respondents using laptops, tablets, and phones all participate.
The current survey design also calls for consumers to be presented with a validation
notice in the other media after they have already answered comprehension questions
(e.g., a paper-based notice if they first answered questions about an electronic notice).
This portion of the qualitative interview should be eliminated, because a respondent
who has already answered questions about a paper-based validation notice, and
potentially had specific content pointed out by the interviewer, will know to anticipate
such content in the electronic format. As a result, these respondents may be more likely
Fors Marsh Group, Debt Collection Model Validation Notice Qualitative Testing Moderator’s
Guide, available at regulations.gov as a related material for CFPB-2020-0024.

29

This would, of course, not replicate the experience of a consumer who receives an email that
they are not expecting or does not receive an email because it is sent to an old or inactive email
account, which would both be possible if the CFPB proceeds with its proposal to allow
alternatives to E-SIGN Act compliance. Alternatives to E-SIGN Act compliance are in §
1006.42(c). See Proposed Rules, 84 Fed. Reg. at 23,406. See also National Consumer Law Center et
al., Comments to the Consumer Fin. Prot. Bureau on its Proposed Debt Collection Rule 206-215,
Docket No. CFPB-2019-0022 (Sept. 18, 2019) (responding to § 1006.42(c)), available at
https://www.nclc.org/images/pdf/debt_collection/comments-debt-collection-sept2019.pdf.
30

If the COVID-19 pandemic forces these qualitative interviews to be conducted virtually, it
would also be possible for the respondent to use a desktop to read the message if that was the
most likely way that she or he would read the email.

31

9

to be able to identify (or to continue look for) content in the electronic format because
they have already seen such content in the paper-based format.

4.2 The CFPB Must Also Test Oral Comprehension of the Validation Information.
The CFPB has proposed allowing debt collectors to provide validation information
orally despite significantly increasing the amount of validation information that would
be provided to consumers.32 However, none of the prior testing and none of the
proposed testing of the model validation notices have involved testing for oral
comprehension of the information contained in a model validation notice.
Auditory comprehension is quite different from reading comprehension.33 Moreover,
information overload, which may result if the entire content of the model validation
notice is delivered orally, is a well-documented impediment to comprehension.34 The
same language that results in strong comprehension among survey respondents who
read the written disclosure may result in weak comprehension among consumers who
hear the language recited orally.
If the CFPB intends to retain oral delivery of validation information in the final rule, it
needs to add oral delivery of validation information as a separate method of delivery in
Delivering validation information orally in the initial communication is discussed at §
1006.34(a)(1)(ii). See Proposed Rules, 84 Fed. Reg. at 23,404. See also National Consumer Law
Center et al., Comments to the Consumer Fin. Prot. Bureau on its Proposed Debt Collection
Rule 146-147, Docket No. CFPB-2019-0022 (Sept. 18, 2019) (responding to § 1006.34(a)(1)(ii)),
available at https://www.nclc.org/images/pdf/debt_collection/comments-debt-collectionsept2019.pdf.
32

See, e.g., Erica B. Michael, Timothy A. Keller, Patricia A. Carpenter, & Marcel Adam Just, fMRI
Investigation of Sentence Comprehension by Eye and by Ear: Modality Fingerprints on Cognitive
Processes, 13 Hum. Brain Mapping 239 (2001) (“[E]ven when written and spoken language have
the same content, the two modalities provide different information and make different
demands on the comprehender.”).

33

See, e.g., Martin J. Eppler & Jeanne Mengis, The Concept of Information Overload: A Review of
Literature from Organization Science, Accounting, Marketing, MIS, and Related Disciplines, 30 The
Information Society 325 (2004) (“Researchers across various disciplines has found that the
performance (i.e., the quality of decisions or reasoning in general) of an individual correlates
positively with the amount of information he or she receives—up to a certain point. If further
information is provided beyond this point, the performance of the individual will rapidly
decline. . . . The burden of a heavy information load will confuse the individual, affect his or her
ability to set priorities, and make prior information harder to recall.”).

34

10

the qualitative testing. Since oral validation information would be most likely to be
delivered over the phone, this portion of the qualitative testing should be administered
over the phone to most faithfully replicate real-world conditions.

4.3 The CFPB Must Also Test Validation Notices Delivered by Hyperlink.
The CFPB has proposed allowing debt collectors to provide validation information by
placing the disclosure on a website and providing a hyperlink to that website via email
or text message.35 However, none of the prior testing and none of the proposed testing
of the model validation notices have involved testing for delivery of validation notices
via hyperlink.
If the CFPB intends to retain delivery of validation notices via hyperlink in the final
rule, it needs to test comprehension of validation information delivered via hyperlink as
a separate method of delivery in the qualitative testing. Such testing needs to include
questions regarding whether the consumer would click on a hyperlink in an email or
text message that is received from an unknown number or email address. As discussed
above in Section 4.1, the CFPB should test the electronic version of the validation notice
that would be displayed to the consumer on the type of device that the consumer would
likely use to access such a hyperlink.
5. Conclusion
We urge the CFPB to engage in additional testing of the model validation notices
beyond what it has proposed with this qualitative testing. When results show lack of
comprehension or other problems with the proposed model validation notices, the
CFPB should be committed to revising and retesting the notice. Moreover, due to the
inevitable shortcomings of lab tests for the proposed model validation notices, we urge
the CFPB to monitor comprehension and evaluate effectiveness of the model validation
notices even after a final rule so that the CFPB can continue to improve this critical
notice to consumers.

Delivering validation notices via hyperlink is discussed at the proposed § 1006.42(c)(2)(ii). See
Proposed Rules, 84 Fed. Reg. at 23,406. See also National Consumer Law Center et al.,
Comments to the Consumer Fin. Prot. Bureau on its Proposed Debt Collection Rule 212-214,
Docket No. CFPB-2019-0022 (Sept. 18, 2019) (responding to § 1006.42(c)(2)(ii)), available at
https://www.nclc.org/images/pdf/debt_collection/comments-debt-collection-sept2019.pdf.
35

11

RECEIVABLES MGMT. ASSOC

July 27, 2020

SETTING

THE

GLOBAL

INTL.

STANDARD

1050 Fulton Avenue #120
Sacramento, California 95825
916.482.2462

By Electronic Submission
Kathleen Kraninger
Director
Consumer Financial Protection Bureau
1700 G St. NW
Washington, DC 20552
Re: RMAI Comment in Response to the Notice and Request for Comment regarding "Debt
Collection Validation Notice Qualitative Testing" (Docket No. CFPB-2020-00241).

Dear Director Kraninger:
The Receivables Management Association International (RMA1) is pleased to submit our
comments in response to the notice and request for comment regarding the "Debt Collection
Validation Notice Qualitative Testing" (Docket No. CFPB-2020-0024). Particularly, RMAI is
providing its comments in response to the Bureau's request for comment on lwjays to enhance
the quality, utility, and clarity of the information to be collected." 85 FR 38870 (June 29, 2020).
RMAI believes that the utility as well as the clarity of the proposed "Debt Collection Validation
Notice Qualitative Testing" would benefit from the inclusion of demographic information tied to
the responses. For example, the Bureau's February 2020 study entitled "Disclosure of Time-Barred
Debt and Revival: Findings from the CFPB' s Quantitative Disclosure Testing,"1 reported
responses received from the survey group and included (in Table 33) the survey group's
demographic information. However, the study did not tie the demographic information to the
survey group's responses to all survey questions. For example, Tables 21 and 22 provided
demographic information related to "Distribution of Average Comprehension Score by Notice
Type." But demographic information was not provided for other responses, including survey
responses concerning electronic delivery of collection communications.
RMAI expects that demographic information concerning age and education tied to survey
responses would enhance the utility of the proposed testing, particularly those responses
concerning electronic delivery of validation notices.
Sincerely,

Jan Stieger•
Executive Director
Receivables Management Association International
Publicly available at https://files.consumerfinance.gov/f/documents/cfpb debt-collection-quantitative-disclosure-

testing_report.pdf

SETTING

THE

GLOBAL

STANDARD

www.rmassociation.org