As CFPB Pulls Back, Receivables Leaders See Regulatory Uncertainty Ahead
The Consumer Financial Protection Bureau has significantly reduced its enforcement and supervisory activities under President Donald Trump’s second administration, raising questions about the future of federal oversight and the growing influence of state regulation.
However, leaders from three major receivables industry associations say the changes have not fundamentally altered businesses’ compliance obligations, and much of the state-level regulatory activity receiving attention today began well before Trump returned to office.
In interviews with Receivables Info, representatives from ACA International, Receivables Management Association International (RMAI) and the National Creditors Bar Association (NCBA) described an industry navigating shifting federal priorities, longstanding state regulatory differences, and uncertainty about what the regulatory landscape will look like in the coming years.
For collection agencies, debt buyers and creditors’ rights attorneys, the central question is whether reduced federal oversight will ultimately produce a more predictable business environment or whether competing federal and state requirements will create additional complexity.
The CFPB’s Changing Role Under Trump
The CFPB underwent substantial operational changes beginning in February 2025, when Trump removed former Director Rohit Chopra, and the administration began scaling back the agency’s enforcement, supervision, and rulemaking activities.
The extent of that shift is reflected in the CFPB’s own 2025 enforcement review, which reported that the bureau closed approximately 40% of its pending investigations during the year.
Between Jan. 31 and Dec. 31, 2025, the agency dismissed or withdrew from 19 public enforcement actions, terminated or modified pending orders or issued no-action letters in 22 matters, and resolved seven cases. Eight public enforcement actions remained pending at the end of the year.
The administration also reduced the CFPB’s potential funding. Legislation signed July 4, 2025, lowered the agency’s statutory funding cap from 12% to 6.5% of the Federal Reserve’s inflation-adjusted 2009 operating expenses, according to the Congressional Research Service.
In April 2025, the CFPB announced revised supervisory and enforcement priorities, including a targeted 50% reduction in supervisory events and a shift toward greater oversight of banks rather than nonbank financial companies.
The bureau also withdrew 67 guidance documents in May 2025, including advisory opinions addressing medical debt collection, time-barred debt, and certain payment fees.
Nevertheless, federal consumer protection laws remain in effect. The Fair Debt Collection Practices Act (FDCPA), Regulation F, and other applicable statutes continue to establish requirements for covered collection businesses.
Scott Purcell, CEO of ACA International, challenged the perception that the administration’s actions have meaningfully reduced the industry’s legal responsibilities.
Purcell said the CFPB’s approach has changed, but responsible collection businesses continue operating under established federal and state requirements.
“The rhetoric is really the only thing that continues to change,” Purcell said.
He emphasized that ACA members maintain compliance management systems because lawful collection practices are fundamental to their businesses and relationships with consumers and creditor clients.
Leah Dempsey, one of ACA’s top federal lobbyists who previously served as ACA International’s vice president and senior counsel for federal advocacy, also cautioned against interpreting reduced CFPB activity as a broader disappearance of federal oversight.
Dempsey noted that the FCC continues addressing issues affecting collection communications, including offshore calling practices. The CFPB also maintains a rulemaking agenda, while other agencies retain authority over relevant industry activities.
The FTC, for example, continues pursuing enforcement involving deceptive debt-relief operations and impersonation schemes.
The CFPB itself continues identifying FDCPA and Regulation F violations among its enforcement priorities, even as it reduces examinations and shifts resources toward matters involving identifiable consumer harm.
“The people trying to do the right thing are still trying to do the right thing,” Dempsey said.
Her broader point was that the industry’s commitment to compliance cannot depend on which administration controls a federal agency.
State Regulation Was Expanding Before Trump Returned to Office
One of the most important distinctions raised by industry leaders is that state regulatory activity did not suddenly emerge in response to the CFPB’s reduced operations.
Andrew Madden, vice president of government and state affairs at ACA International, said state legislatures have been considering increasingly detailed consumer financial protections for years.
ACA has tracked substantial volumes of state legislation over the past decade, and Madden said many of the major proposals affecting debt collection originated in 2023 and 2024, before Trump’s second term.
“To say they are pushing back against the administration, it’s kind of a false narrative,” Madden said.
He explained that legislation frequently takes several years to advance through state legislatures, making it difficult to connect the timing of a new law directly to current federal policies.
New York City’s revised debt collection rules illustrate that distinction. The city’s Department of Consumer and Worker Protection finalized its Stopping Harassment and Intimidation and Ensuring Lawful Debt Collection Rule, known as the SHIELD Rule, in February 2026.
The rule, scheduled to take effect Jan. 1, 2027, restricts collection contact attempts, expands consumers’ ability to dispute debts and imposes additional verification and documentation requirements.
Among its provisions, the rule generally restricts debt collectors to three contact attempts within seven days, subject to specified exceptions, and establishes additional protections involving hospital-related medical debt.
Although the final amendments were adopted during Trump’s second term, New York City’s regulatory initiative developed over several years, including proposals advanced before January 2025.
Madden identified the city’s rules as one of the most consequential state or local developments for collection agencies, particularly because of their implications for companies operating nationally.
His assessment was echoed by Mike Becker, executive director of RMAI, who said the industry had anticipated a substantial increase in state regulatory activity following the CFPB’s retreat.
According to Becker, that expansion has not materialized to the degree some businesses initially expected, though states remain extremely active. Debt buyers and collection organizations have long operated under federal, state, and local requirements. What has changed is the balance of regulatory activity, the agencies exercising oversight, and the uncertainty surrounding future enforcement. Interestingly, that does not mean state-level changes have stopped.
Several jurisdictions have enacted significant measures since January 2025, with different consequences for receivables organizations.
California’s SB 825, effective Jan. 1, 2026, clarified and strengthened the Department of Financial Protection and Innovation’s authority to address unlawful, unfair, deceptive, or abusive practices involving providers of consumer financial products and services.
Maryland enacted three medical-debt laws effective Oct. 1, 2025. According to the state’s Office of Financial Regulation, the measures establish new restrictions involving medical-debt credit reporting, collection lawsuits, liens, and hospital financial-assistance procedures.
Washington enacted legislation restricting medical-debt credit reporting in 2025. Under certain circumstances, a medical debt furnished to a consumer reporting agency in violation of the statute becomes void and unenforceable.
Oregon adopted additional medical-debt reporting restrictions that took effect Jan. 1, 2026.
Virginia also enacted the Uniform Consumer Debt Default Judgments Act in 2026. Scheduled to take effect July 1, 2027, the law establishes documentation and notice requirements for obtaining default judgments in covered consumer debt collection cases.
The developments demonstrate that state oversight continues evolving, although the legislative history and purpose of each measure differ.
Medical Debt Highlights the Tension Between Federal and State Authority
Medical debt has become one of the clearest examples of the competing directions of federal and state consumer financial regulation.
On Jan. 7, 2025, the CFPB finalized a rule designed to remove certain medical-debt information from consumer credit reports used in lending decisions and restrict creditors’ consideration of that information. Following the administration change, the CFPB reversed its litigation position.
On July 11, 2025, a federal district court in Texas vacated the rule nationwide, concluding that the regulation exceeded the agency’s statutory authority under the Fair Credit Reporting Act (FCRA).
At the state level, however, restrictions continued expanding.
According to a September 2026 analysis by the National Consumer Law Center, 15 states and Washington, D.C., have enacted laws restricting medical-debt credit reporting in some form.
Those laws vary significantly. Some limit the information consumer reporting agencies can include, while others prohibit medical providers and collection agencies from furnishing medical debts. Several require healthcare providers to include specific credit reporting restrictions in contracts with collection agencies.
The timing of these bills, however, reinforces Madden’s point about state regulations moving slower than federal changes can really dictate. Colorado enacted medical-debt credit reporting restrictions in 2023. New York adopted similar legislation that year, while Connecticut, Minnesota and New Jersey enacted additional protections in 2024. Other states, including Maryland, Washington, Oregon, Maine, Delaware and Vermont, enacted or expanded protections during 2025.
These differing approaches have created legal questions over whether the FCRA preempts certain state requirements. In October 2025, the CFPB adopted an interpretive rule asserting a broader view of federal preemption, potentially limiting states’ authority to regulate consumer credit reporting.
The scope of that authority remains contested in litigation, with federal courts considering challenges to individual state laws.
Dempsey highlighted these disputes as an important issue for ACA, noting that the association continues engaging federal regulators and Congress over the relationship between state requirements and federal law.
She also suggested that momentum behind some state initiatives began years earlier and that legal challenges are raising questions about how far state regulators can go.
For receivables organizations, unresolved preemption questions create practical uncertainty. Companies must determine which reporting restrictions apply, whether those requirements may change following litigation, and how to maintain systems capable of meeting different legal standards.
The issue extends beyond medical debt. It also raises broader questions about the appropriate division of authority between federal and state regulators.
Regulatory Complexity Creates Business Challenges
Although industry leaders recognize the importance of consumer protections, they repeatedly identified regulatory consistency and implementation costs as significant business concerns.
Becker explained that even relatively limited changes to state requirements can affect how debt buyers and collection agencies operate. New licensing obligations, reporting restrictions and examination requirements can create additional expenses, particularly for companies working across multiple jurisdictions.
The challenge is that businesses must understand how requirements overlap, whether they conflict, and what operational changes are necessary to comply.
Becker pointed to state licensing as one of the clearest examples, as companies may face different application procedures, recurring fees, audits, and examination expectations depending on where they operate. Those expenses can be especially difficult for smaller organizations with fewer accounts over which to distribute costs.
He also cautioned that regulations developed without sufficient consultation with affected businesses can produce unintended consequences, even when policymakers are pursuing legitimate consumer protection goals.
From the debt-buying perspective, uncertainty can complicate portfolio valuation and investment decisions. Restrictions on credit reporting, litigation, debt sales, and collection activities may affect a portfolio’s expected recoveries and the cost of servicing accounts.
That distinction matters when assessing whether the CFPB’s changing priorities have improved business conditions. Federal examinations may become less frequent, but receivables organizations still need compliance programs capable of meeting established laws and adapting to future changes.
Becker also showcased a constructive development: Changes to the CFPB’s consumer complaint system.
In June 2026, the bureau announced changes to its complaint processes, including enhanced identity protections and revised procedures intended to improve complaint accuracy and usefulness.
Becker said those changes helped address some concerns RMAI had raised about the misuse of complaint procedures while preserving opportunities for consumers to report legitimate problems. He noted that further improvements are needed but viewed the changes as a positive step forward.
For RMAI, the broader priority is maintaining an effective relationship with regulators and encouraging policies developed with a practical understanding of receivables operations.
Collection Attorneys Face a Separate Regulatory Challenge
For creditors’ rights attorneys, the changing regulatory environment raises questions extending beyond compliance costs.
Liz Terry, CEO of the National Creditors Bar Association, identified the relationship between federal administrative oversight and the judicial system as a central concern for collection law firms.
“The number one issue is the independence of the practice of law,” Terry said.
NCBA has long advocated for clearer boundaries between the authority of federal financial regulators and the courts responsible for overseeing attorneys practicing before them.
The association supports federal legislation intended to restore or clarify judicial authority over litigation-related attorney conduct. Terry argued that overlapping regulatory systems can create conflicting expectations, particularly when courts establish one set of procedures and federal regulators impose additional requirements on communications or conduct associated with litigation.
The concern becomes more complicated for law firms operating in multiple states. Collection attorneys must already comply with state licensing and professional responsibility requirements, jurisdiction-specific court procedures, and applicable federal consumer protection laws.
Virginia’s forthcoming default-judgment requirements provide one example. The law requires specified information about the account, the creditor, payment history, amounts sought, and the plaintiff’s authority to collect before a court may enter a covered default judgment.
These provisions may improve documentation available to courts and consumers, but they can also increase the work required before creditors and collection law firms pursue litigation. Terry noted that many creditors’ rights law firms are relatively small businesses, even when compared with firms in other areas of legal practice.
In Terry’s view, better education and more effective opportunities to communicate with consumers could help resolve disputes earlier and reduce reliance on default judgments. NCBA has engaged with organizations including The Pew Charitable Trusts on issues involving consumer debt litigation and opportunities to improve the court process.
Her comments also underscore a broader policy question: How can regulators protect consumers from improper collection practices while preserving meaningful opportunities to resolve legitimate financial obligations?
Looking Toward 2029: The Regulatory Pendulum
With more than two years remaining in Trump’s second term, industry leaders are looking beyond the immediate reduction in federal enforcement.
A central concern is whether the current administration’s changes will produce lasting regulatory stability or whether another shift in federal leadership could restore more expansive CFPB supervision and enforcement.
The CFPB’s operational future is also subject to ongoing litigation.
On Sept. 25, 2026, a federal district court in Oregon ruled against decisions to withhold CFPB funding requests, concluding that the challenged actions violated federal law and constitutional separation-of-powers principles.
For collection agencies, debt buyers, and law firms, the longer-term concern is that federal enforcement could increase again after 2028 while state requirements enacted during the current administration remain in place.
Purcell and Dempsey emphasized that ACA members must maintain effective compliance programs regardless of political leadership, something almost all ACA members already do. Terry raised similar concerns about the need to establish clearer boundaries between administrative oversight and the judicial system.
Becker argued that the industry’s long-term outlook will also depend on broader economic conditions. Consumers continue relying on credit products to finance everyday expenses, including credit cards, installment loans, and buy now, pay later arrangements. As financial pressure affects borrowers, the need for effective and lawful receivables management is unlikely to disappear. That places additional importance on regulations that can protect consumers while providing businesses with consistent expectations.
“We’re going to need a reliable regulatory framework,” Becker said.
For an industry that operates across multiple jurisdictions and plays a role in the broader consumer credit system, regulatory consistency may ultimately prove more valuable than temporary reductions in federal oversight.
Whether that consistency emerges before January 2029 remains an open question.
