Money Minute: Cracking down on debt collectors [Video]

The regulatory bill is finally coming due for debt collectors.

The Consumer Financial Protection Bureau has announced new rules that for the first time would place large debt collectors and credit reporting companies under Uncle Sam’s thumb.

This is the most far-reaching proposal so far from the agency that was a key agenda item for the Obama administration.

“Our proposed rule would mean that those debt collectors and credit reporting agencies that qualify as larger participants are subject to the same supervision process that we apply to the banks,” Richard Cordray, the director of the bureau, says in a statement.

The bureau would keep watch over debt collectors making more than $10 million a year from their consumer business. Such companies account for about two-thirds of the debt-collection market.

The bureau’s proposal also targets the largest consumer reporting agencies, defined as companies that make more than $7 million annually from their consumer business. That would include 30 companies that account for more than 90% of the industry’s business.

All I can say is: It’s about time.