Just to be clear, ECPG is not a competitor to CPSS.
ECPG is a debt collector, that buys distressed receivables from banks and other financial institutions and tries to recover as much money as they can. Some of these players have come under fire for robosignings and aggressive legal tactics and that is what the CFPB is focused on. I think this is a fixable problem that shouldn't impact the core performance of the business, but it is a HUGE distraction because things haven't been resolved yet and the uncertainty is killing the institutional interest in the stock.
CPSS is a subprime lender to borrowers who are trying to purchase new or used cars. They charge high interest rates and have to manage their defaults and loan charge-offs to make profits for shareholders. They also rely on the credit markets to function smoothly in order to securitize and resell their loans to get the cash to make new loans. They also have been hurt by allegations of aggressive or deceitful tactics. CPSS has refuted many of these allegations on past CCs, but they get lumped in with the bad apples in the sector.
To me, the worst of the industries that CFPB has been trying to reign in are the payday lenders and other credit companies that extend small loans to sub-prime lenders. The fees and interest rates that get charged vary by state to state, and are often confusing and designed to get around existing laws that cap extremely high interest rates. Not saying that none of this is the borrower's fault, but many of these poor individuals aren't exactly dealing with honesty on the other side of the table either.
