As debt-collection lawyers prepare to gather in Washington for a trade association meeting, the Consumer Financial Protection Bureau  is at the forefront of their concerns. In the past year, the CFPB has begun overseeing lawyers who represent banks, credit card issuers, automobile finance companies, and other creditors in collecting overdue payments from consumers.

Christopher J. Willis, a Ballard Spahr partner who represents debt-collection lawyers, said the CFPB has made it clear that it will hold creditors responsible for anything a service provider—including outside counsel—does. As a result, he said, debt-collection lawyers “are being subjected to constant audits by their clients … over even the most minute details.”

This trend may stem from the robo-signing scandal, in which a number of small law firms came under fire for faking foreclosure documents. Even though the CFPB excluded foreclosures in defining the activities of attorneys subject to its supervision, “the memory of that kind of law firm behavior may have carried over” to the scrutiny of debt-collection lawyers, Mr. Willis said.

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Consumer Financial Services