WASHINGTON – On Wednesday, November 13, Rep. Madeleine Dean's (PA-04) Fair Debt Collection Practices for Servicemembers Act (H.R. 5003) passed out of the Financial Services Committee with unanimous support. This legislation addresses a variety of abusive debt collection practices targeting members of the military.
“The Financial Services Committee is taking a hard look at unscrupulous debt collection practices, and protecting our servicemembers is a top priority. This week's unanimous vote sends a clear signal - we will stand up to defend our servicemembers," said Rep. Dean.
According to the Consumer Financial Protection Bureau, (CFPB) servicemembers are subject to a variety of unfair debt collection practices:
- Contacting the servicemember’s chain of command in order to extract payment;
- Including a clause in the loan contract that the servicemember must grant the debt collector the authority to contact the chain of command;
- Threatening punishment through the Uniform Code of Military Justice, threatening to have the servicemember’s rank reduced, or threatening to have security clearances revoked.
The problem is significant. Nearly forty percent of complaints filed by servicemembers with the CFPB concern debt collection, and servicemembers were more likely to face debt collection challenges than all other consumers.
Rep. Madeleine Dean is a mother, grandmother, attorney, professor, former four-term member of the Pennsylvania House of Representatives, and U.S. Representative for the Fourth District of Pennsylvania.