A variety of regulatory developments within financial services arrived this week, ranging from a federal judge siding with a national collections organization, the Consumer Financial Protection Bureau offering guidance involving federal assistance for small businesses as well as the Federal Trade Commission delivering a report to Congress about its ongoing efforts associated with credit-report disputes.

Our roundup begins with ACA International announcing on Wednesday that Judge Richard Stearns of the Federal District Court of Massachusetts granted its motion for a temporary restraining order and preliminary injunction in a lawsuit challenging Massachusetts Attorney General Maura Healey’s emergency order that stops outbound collections calls for 90 days.

“ACA will evaluate the decision to determine the immediate effect of the court’s preliminary injunction order,” ACA said in an online post about the development connected to the regulation that has been in effect since March 26.

To recap, Healey’s emergency regulation prohibited creditors from engaging in methods of debt collection that can require people to leave their homes or have in-person contact, including filing new lawsuits against Massachusetts consumers, visiting their homes or places of work, or repossessing their vehicle, among other protections. The AG’s emergency regulation also prohibited debt collection agencies and debt buyers from making unsolicited debt collection telephone calls to consumers.

Healey’s emergency regulation was to remain in effect for 90 days or until the conclusion of the declared state of emergency.

The AG’s emergency debt collection regulation contained protections that apply to all creditors and prohibits them from “deceptive practices” in pursuing the payment of debt during the COVID-19 emergency, including:

— Filing any new collection lawsuit

— Garnishing wages, earnings, properties or funds

— Repossessing vehicles

— Applying for or serving a capias warrant

— Visiting or threatening to visit the household of a debtor

— Visiting or threatening to visit the place of employment of a debtor

— Confronting or communicating in person with a debtor regarding the collection of a debt in any public place

The AG’s emergency debt collection regulation also prohibits debt collection agencies and debt buyers from making unsolicited debt collection telephone calls to Massachusetts consumers for the next 90 days, unless the state of emergency ends before that time.

“The COVID-19 crisis has caused substantial medical and financial hardship for families in Massachusetts, and we want to do everything we can to protect them from further harm,” AG Healey said in a news release posted on March 27. “This emergency regulation puts additional restrictions in place to prevent debt collectors and creditors from harassing our residents.”

Stearns closed his 29-page order that ACA International made available here by summarizing reasons for his decision.

“Given the plethora of protection provided to debtors by the laws and regulations the court has previously cited, the interest a debtor may have in the regulation may not weigh as heavily as the threat of extinction faced by smaller collection agencies who have been effectively put out of business,” the order said. “Of perhaps greater concern is the impact the Regulation may have on hospitals and utilities who depend on collection agencies to remain solvent.

“Finally, the court recognizes the argument advanced by ACA that a capitalist society has a vested interest in the efficient functioning of the credit market which depends in no small degree on the ability to collect debts,” the order went on to say.

CFPB on PPP guidance

Also arriving this week, the Consumer Financial Protection Bureau issued clarifying FAQs to support small businesses that have applied for a loan from their financial institution under the Small Business Administration’s (SBA) Paycheck Protection Program (PPP).

The bureau explained creditors are generally required under the Equal Credit Opportunity Act and Regulation B to notify applicants within 30 days of receiving a “completed application” of the creditor’s approval, counteroffer, denial or other adverse notice regarding the application.

Officials pointed out Regulation B notifications of action taken are designed to help consumers and businesses by providing transparency to the credit underwriting process in a timely manner. They added information that is generally included in a complete application includes any approvals or reports by governmental agencies or others who can guarantee, insure, or provide security for the credit or collateral.

In its FAQs, the CFPB said it clarifies that a PPP application is only a “completed application” once the creditor has received a loan number from the SBA or a response about the availability of funds.

“This ensures that the time awaiting this information from the SBA does not count towards the 30-day notice requirement, and that applications will therefore not ‘time out’ during the process,” the bureau said.

The CFPB went on to mention the FAQs also make clear that if the creditor denies an application without ever sending the application to the SBA, the creditor must give notice of this adverse action within 30 days.

“It further clarifies that a creditor cannot deny a loan application based on incompleteness where the creditor has enough information for a credit decision but has yet to receive a loan number or response about the availability of funds from the SBA,” officials said.

FTC on credit reports

The regulatory developments this week also included the Federal Trade Commission submitting a report to Congress updating lawmakers on the agency’s efforts to educate consumers about their rights to dispute and correct errors in their credit reports.

The commission indicated lawmakers requested the report available here as part of the fiscal year 2020 spending bill that funds the FTC and other federal agencies.

Under the Fair Credit Reporting Act (FCRA), the FTC explained consumer reporting agencies must have reasonable procedures to ensure the accuracy of consumers’ reports and give consumers the ability to dispute and correct errors.

Officials pointed out consumer reports are used to determine a consumer’s eligibility for credit, insurance, housing, employment, and other benefits. Errors in consumer reports can cause consumers to be denied credit or other benefits, or pay a higher price for them.

The FTC said it continues to look for education and enforcement opportunities around the issue of consumer report accuracy and disputes.

Last December, the FTC hosted a public workshop, jointly with the CFPB, regarding issues affecting the accuracy of both traditional credit reports and employment and tenant background screening reports.

Officials recapped the workshop brought together stakeholders — including industry representatives, consumer advocates and regulators — for a wide-ranging public discussion on the many issues that affect the accuracy of consumer reports. Their goal in co-hosting this workshop was to further educate itself on recent trends in consumer reporting accuracy, including:

— Current practices of furnishers of information and compliance with accuracy requirements

— Current accuracy topics for traditional credit reporting agencies

— Accuracy considerations for background screening

— Navigating the dispute process