Celebrating Inclusivity and Giving at the Best Buddies Friendship Walk 2023

DULUTH, Ga. — Crown Asset Management, a receivables acquisition and management firm in Duluth, GA, is proud to share our recent participation in the inspiring and heartwarming Best Buddies Friendship Walk 2023. We truly believe in the power of community and giving back, and we encourage everyone to join us in supporting this wonderful cause.

About the event

The Best Buddies Friendship Walk is an annual event that takes place in various locations across the country. This year, on Saturday, April 22nd, the Atlanta, GA walk was held at the picturesque Blackburn Park in Brookhaven, Georgia. The event brings people together to celebrate friendships and promote inclusivity for individuals with intellectual and developmental disabilities (IDD). As part of our corporate social responsibility, we were honored to contribute to Best Buddies International’s mission and participate in the event.

Event highlights

The Friendship Walk features several exciting activities designed to engage participants and create a fun, inclusive environment for all. Some highlights of this year’s event included:

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  • A 0.4-mile walk, accessible for all ages and abilities;
  • A delicious pancake bar hosted by Snooze Eatery, ensuring everyone was well-fed and energized;
  • A variety of yard games and inflatables for attendees to enjoy;
  • Crafts and fun photo ops, adding a touch of creativity and color to the festivities;
  • And live entertainment, including an enthusiastic DJ and energetic skits that kept spirits high throughout the day.

Team building and community impact

Participating in the Friendship Walk served as an excellent team-building opportunity for our staff at Crown Asset Management. Together, we shared a memorable experience while giving back to our community and supporting a cause that aligns with our values of fairness and respect. The event also allowed us to connect with other local businesses and organizations, fostering a sense of unity and collaboration in our community.

Fundraising opportunities

We made a difference! With collective efforts, we supported Best Buddies International by creating opportunities for one-to-one friendships, integrated employment, leadership development, and inclusive living for people with IDD. In addition, participating in the walk and related fundraising events allowed us to contribute to a more inclusive society where everyone is treated with dignity and respect.

Celebrating top fundraisers and teams

We wholeheartedly extend our appreciation to everyone who has championed the cause of Best Buddies in Georgia, with a special mention to the top fundraisers and teams. Your steadfast dedication, relentless hard work, and unyielding commitment have made a profound impact on the lives of individuals with IDD. As we eagerly await next year’s walk, your passion for change and your devotion to fostering a world where everyone can thrive inspires us. We look forward to seeing even more people join us in this remarkable endeavor.

Getting involved

Curious to learn more about Best Buddies International and the Friendship Walk? Dive into the details at bestbuddiesfriendshipwalk.org/georgia where you can learn how to actively take part in the walk, make a donation, or offer your valuable volunteer time. You can contribute significantly to making a difference and nurturing a more inclusive and supportive community.

Join in supporting this cause

Crown Asset Management is proud to have participated in the Best Buddies Friendship Walk 2023 and invites you to join them in supporting this incredible cause. Together, we can make a lasting impact on the lives of individuals with IDD and promote a more inclusive, compassionate world where everyone is valued and celebrated.

About Crown Asset Management

Founded in 2004, Crown Asset Management, LLC, is a professional receivables management firm that outsources purchased accounts to a nationwide, proprietary network of collection agencies and law firms. Utilizing a cutting-edge predictive analytical model during pre-purchase portfolio due diligence, our team focuses on achieving appropriate financial returns while ensuring the best possible experience for consumers. Crown Asset Management is an RMAI Certified Receivables Business headquartered in Duluth, GA.

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Everything We Know About BNPL Borrowers

We’re beginning to get a clearer picture of Buy Now, Pay Later borrowers. While it has been long speculated that BNPL borrowers chose to use that option because of a lack of credit, the CFPB released a report based on data from their 2022 Making Ends Meet Survey which makes it clear that BNPL borrowers do have access to other credit, and they are using it. In fact, BNPL borrowers are more likely to “actively use other credit products” than consumers who don’t use BNPL loans. According to their analysis, 95% of BNPL borrowers “had at least one credit record in another account, compared to 86% of non-borrowers.”

BNPL Borrowers Have Lower Credit Scores

Another finding from the report is less of a surprise: BNPL borrowers have lower credit scores than non-borrowers. The average credit score of BNPL borrowers is in the subprime range. Typically, as the analysis notes, subprime borrowers encounter higher interest rates on traditional loans and credit cards, which makes BNPL products more attractive to those consumers.

 The report did not lead the CFPB to any conclusions about whether BNPL use might lead to more delinquencies on the borrower’s other obligations, but they did note that BNPL borrowers are twice as likely than non-borrowers to be delinquent on one of their other credit obligations, like credit cards, personal loans, auto loans, student loans or mortgages.

However, as inflation remains high and despite a strong labor market, lower-income consumers (especially those with subprime credit scores) are feeling the pinch more than higher-income consumers. If those consumers are also overextending their financial situation using BNPL products, it’s easy to speculate that those borrowers will be impacted negatively in the event of a recession.

Credit Warping Remains a Concern

The findings also contribute to another ongoing concern in the credit world: credit warping. Consumers are not using only BNPL products or traditional credit, they are using both, and without accurate reporting from BNPL lenders, we still don’t have a clear picture of consumers’ credit health. This puts lenders in a perilous situation, since consumers’ credit scores are likely artificially inflated. Even if a potential borrower looks good on paper, it’s possible for the borrower to have many other open lines of credit through BNPL lenders which are not reflected on their credit report, and therefore invisible to traditional lenders, or even other BNPL lenders.

Consumers are at risk of becoming overleveraged, and that leaves lenders at risk of being unable to collect on delinquent accounts in the event of an economic downturn.

Other findings from the report include:

  • Buy Now, Pay Later borrowers had significantly higher usage in several other loan products when compared to non-borrowers, including retail accounts (62% compared to 44%), personal loans (32% compared to 13%), and student loans (33% compared to 17%).

  • Black, Hispanic, and female consumers are more likely than average to use Buy Now, Pay Later products, along with consumers with income between $20,001-$50,000.

  • Eighteen percent of Buy Now, Pay Later borrowers had at least one reported delinquency in another account, compared to 7% of non-borrowers. Delinquency rates were substantially higher for credit (9%) and retail cards (8%) among Buy Now, Pay Later borrowers compared to non-borrowers (3% and 1% respectively).

For more reading on BNPL Borrowers, check out:

BNPL is Primed for Growth

BNPL Growing Pains Show Need for Greater Consumer Focus

A Guide to Buy Now, Pay Later and Digital Debt Collections

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Eagle Accounts Group, Inc. sees Unparallel Scale and 168% Boost in Agent Productivity with Skit.ai

NEW YORK, N.Y.  Skit.ai, the leading Conversational Voice AI solution provider in the Account Receivable Management (ARM) industry, revealed the success of its partnership with Eagle Accounts Group, Inc. an Indianapolis-based business specializing in debt collection services since 1972. Skit.ai’s compliant, configurable and easy-to-deploy Voice AI solution was strategically deployed to automate Eagle Accounts Group’s collection efforts, enabling  them to scale drastically, increasing connectivity, performance, while reducing collection cost. 

The successful deployment of Skit.ai’s Augmented Voice Intelligent Platform addressed a few challenges faced by Eagle Accounts Group, such as limited scalability, high agent training costs, and escalating collection costs. Delivering an impressive 18% increase in collection, a 31% rise in connectivity, and a high engagement rate of 60%, while being fully compliant. The Skit.ai platform paved the way for Eagle Accounts Group to transition from traditional processes and strategies, enabling them for business expansion.

“Skit.ai’s Conversational Voice AI solution has surpassed our expectations by catalyzing a transformation of our collection processes. Increase in collections, connectivity, account penetration and our capacity to handle a more substantial debt portfolio are proof of the efficacy of their solution. Furthermore, Skit.ai’s solution has contributed to an impressive rise in agent productivity,” said Ryan Johnson, Office Manager, Eagle Accounts Group. 

He further added “Significantly, this solution has played a vital role in the expansion of our business. With newer capabilities such as scalability, and improved performance, we have been successful in improving our existing client relationships and in onboarding new clients.”


The Skit.ai team played an instrumental role in facilitating a seamless transition for Eagle Accounts Group from their existing systems to cutting-edge Voice AI technology. This implementation did more than modernize the collection procedures. It markedly improved overall productivity, leading to streamlining of processes. As a result, it has instilled a renewed sense of optimism within the organization.

“Eagles Accounts Group was able to implement scalable processes through this partnership. Our solution boosted Agent Productivity, Collections, and Connectivity by 168%, 18%, and 31% respectively, showcasing the impact our solution can have in the ARM Industry.” stated Sourabh Gupta, Founder, and CEO of Skit.ai

To learn more about how Skit.ai’s has aided Eagle Accounts Group Inc, scale their operations and increase their collection performance book a meeting with an expert at Skit.ai.

About Eagle Accounts Group, Inc: 

Eagle Accounts Group, Inc. located in Indianapolis, Indiana was established in 1972 and offers state, regional and nationwide debt collection services and is licensed, bonded and insured for your protection providing debt collection, asset recovery, dispute resolution, billing, pre-collection programs and court services. Eagle Accounts Group has the highest regard for the security and integrity of their client’s data. https://eagleaccounts.com/

About Skit.ai: 

Skit.ai is the leading Conversational Voice AI company in the ARM industry, enabling collection agencies to streamline and accelerate revenue recovery. Skit.ai’s Compliant, Configurable, and Easy-to-deploy solution enables enterprises to automate nearly one million weekly consumer conversations. Skit.ai has been awarded several award & recognitions, including Disruptive Technology of the Year 2022 by CCW; Stevie Bronze Winner 2022 by The International Business Awards; Gold Globee CEO Awards 2022. Skit.ai is headquartered in New York City, NY.  https://Skit.ai

skit 6/1/23 PR

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Sixth Circuit Affirms Dismissal of FDCPA Suit Arising From Pandemic-Time In Person Service of Process

The Sixth Circuit recently affirmed a district court’s dismissal of a Fair Debt Collection Practices Act (FDCPA) and Michigan Regulation of Collection Practices Act (RCPA) suit, holding that the plaintiff lacked standing. The litigation, Van Vleck v. Leikin, Ingber, & Winters, P.C., arose from the defendant law firm’s service of process on the plaintiff in a different lawsuit.

In the underlying suit, in April 2020 the law firm’s process server served the plaintiff in person with a summons and complaint seeking to collect a debt on behalf of the law firm’s client. The summons, which was the standard pre-pandemic state court form, indicated that the plaintiff had twenty-one days to answer the complaint. The summons did not notify the plaintiff that the Michigan Supreme Court had temporarily suspended that deadline due to the COVID-19 pandemic.

The plaintiff then filed suit against the law firm that served him in the Eastern District of Michigan. The plaintiff first alleged that the law firm had violated the FDCPA and RCPA by serving him in person despite the stay-at-home order and by using a young, unmasked process server who might “spread[]” the COVID-19 virus. The plaintiff also alleged that the standard summons’ non-disclosure of the deadline suspension was false and misleading. The law firm moved to dismiss for lack of standing. In response, the plaintiff argued that the in-person service had caused him injury akin to battery or abuse of process.

The district court judge dismissed the FDCPA claim without prejudice for lack of a concrete injury and declined to exercise pendent jurisdiction over the state law claims. The plaintiff moved to vacate the dismissal arguing that the court had improperly considered extrinsic evidence when analyzing the nature of the alleged injury. The plaintiff also moved to amend the complaint and to certify a question to the Michigan Supreme Court. The district court denied his motions and the plaintiff appealed the decision to the Sixth Circuit.

The court of appeals made quick work of the plaintiff’s standing claims. The court first held that the plaintiff had waived the argument that the service of process constituted an invasion of privacy because he had raised it for the first time in his motion to vacate and had not argued it on appeal.

The court also rejected the plaintiff’s argument that his injury was closely related to a battery because the plaintiff had voluntarily opened the door and taken the summons and complaint from the process server without first putting on a mask, and there were no allegations of involuntary physical contact. The court also noted that the “extrinsic evidence” to which the plaintiff objected was merely corroborative, not dispositive.

Next, the court rejected the plaintiff’s argument that the service constituted a concrete injury because it was closely related to the common law tort of abuse of process, conveying a false sense of urgency to answer the complaint during the pandemic and causing him to hire an attorney to represent him in court. The court of appeals explained that the use of the standard summons and personal service were not analogous to an abuse of process because the plaintiff did not plausibly allege that the firm or the process server acted with an ulterior purpose, intending to deprive the plaintiff of the knowledge of the suspended deadline.

Finally, the court ruled that the plaintiff’s alleged general emotional distress and financial injuries did not rise to a level sufficient to convey standing. Therefore, the court of appeals affirmed the district court’s dismissal of the plaintiff’s claims and denial of the plaintiff’s subsequent motions in full.

This case serves as a helpful reminder that mere procedural deficiencies may not be sufficient to constitute standing and defendants should not be too quick to move to the merits where no actual injury was suffered by a plaintiff.

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The Cascade365 Family of Companies Announces Mary Sand as Director of Client Services

PETALUMA, Calif. — The Cascade365 Family of Companies is excited to announce that Mary Sand has joined the team as Director of Client Services.

Mrs. Sand will lead the continued growth of the Cascade365 Client Services team, further enhancing and building upon Cascade365’s strong tradition of providing its clients with best-in-class support.

Mrs. Sand joins Cascade365 with over 30 years of experience in healthcare receivables management and revenue cycle operations. Prior to joining Cascade365, Mrs. Sand served as Vice President of Operations at RevSolve/USCB. Amongst Mrs. Sand’s many accomplishments at RevSolve/USCB, she was instrumental in creating and managing the Client Services and Onboarding departments.  Mrs. Sand has a strong track record in cultivating and maintaining communication channels with clients, administering project management plans, improving business workflows, increasing departmental productivity and accuracy, and identifying and acting upon client/company synergies. 

“I am thrilled that Mary has joined Cascade365,” said Lee Brockett, Chief Executive Officer of the Cascade365 Family of Companies. “Mary’s experience and leadership will enable Cascade365 to not skip a beat as we increase in client volume and complexity.  Cascade365 is steeped in a strong culture of providing best-in-class pricing/client economics as well as patient/consumer experience.  The ‘third leg of the stool’ is client services, making sure that Cascade365’s clients receive the best services possible. Mary will be instrumental in Cascade’s ongoing success as we continue a trajectory of growth and increased footprint within the healthcare vertical.”

“I am beyond honored to work with the talented team at Cascade365 and look forward to furthering their efforts and strong contribution to healthcare and revenue cycle” said Mrs. Sand.  “Cascade365 is a true leader in the marketplace of healthcare accounts receivable management, which includes debt purchase, master servicing, collections, and specialty finance.  I am excited to support the organization’s endeavors, including growing a best-in-class Client Services team and helping to structure innovative client service practices.”

About The Cascade365 Family of Companies 

Cascade365 is a brand identity representing a family of companies focused on the responsible liquidation of accounts receivable.  Headquartered in the San Francisco Bay area, the Cascade365 Family of Companies are recognized leaders in the accounts receivable management, revenue cycle and specialty finance industries. Cascade365’s suite of products and services include AR Purchase and Finance, Master Servicing, Third Party Collections, and Revenue Cycle Optimization.  The Cascade365 Family of Companies believes in promoting financial accountability while treating patients in a fair, dignified, and lawful manner.  

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Montana Enacts Comprehensive Consumer Data Privacy Law

Montana Gov. Greg Gianforte on May 19 signed into law Senate Bill 384, the Montana Consumer Data Privacy Act, making Montana the ninth state to enact a comprehensive consumer data privacy law, following California, Virginia, Colorado, Utah, Connecticut, Iowa, Indiana, and Tennessee. The law will take effect Oct. 1, 2024.

Applicability

The law applies to persons that conduct business in Montana or persons that produce products or services that are targeted to residents of Montana and:

  • control or process the personal data of not less than 50,000 consumers, excluding personal data controlled or processed solely for the purpose of completing a payment transaction; or
  • control or process the personal data of not less than 25,000 consumers and derive more than 25% of gross revenue from the sale of personal data.

Exemptions

Importantly, the law exempts financial institutions and affiliates, or personal data subject to the Gramm-Leach-Bliley Act. Other exemptions include covered entities or business associates governed by the Health Insurance Portability and Accountability Act, and the use of personal information to the extent the activity is regulated by and authorized under the Fair Credit Reporting Act.

Consumer Rights

Consumers are provided the right to:

  • confirm whether a controller is processing the consumer’s personal data and to access the personal data;
  • correct inaccuracies in the consumer’s personal data;
  • delete personal data about the consumer;
  • obtain a copy of the consumer’s personal data previously provided by the consumer;
  • opt out of the processing of personal data if the purpose is for targeted advertising, sale of the personal data, or profiling in furtherance of solely automated decisions that produce legal or similarly significant effects concerning the consumer.

Sensitive Data

A controller may not process “sensitive data” without a consumer’s consent.

“Sensitive data” includes:

  • data revealing racial or ethnic origin, religious beliefs, a mental or physical health condition or diagnosis, information about a person’s sex life, sexual orientation, or citizenship or immigration status;
  • the processing of genetic or biometric data for the purpose of uniquely identifying an individual;
  • personal data collected from a known child; or
  • precise geolocation data.

Contract Requirements

A contract between a controller and a processor must include certain provisions to:

  • ensure that each person processing personal data is subject to a duty of confidentiality with respect to the personal data;
  • at the controller’s direction, delete or return all personal data to the controller as requested;
  • on the reasonable request of the controller, make available to the controller all information in the processor’s possession necessary to demonstrate the processor’s compliance;
  • engage any subcontractor pursuant to a written contract that requires the subcontractor to meet the obligations of the processor with respect to the personal data; and
  • allow and cooperate with reasonable assessments by the controller or the controller’s designated assessor.

Data Protection Assessments

A controller must conduct and document a data protection assessment if the processing involves:

  • targeted advertising;
  • the sale of personal data;
  • certain profiling;
  • sensitive data.

Enforcement

The Attorney General has the exclusive authority to enforce the law. Prior to taking any action, the Attorney General must provide a controller or processor 60 days to cure the violation. In the absence of a cure, civil penalties not to exceed $7,500 may be sought for each violation. The cure provision expires April 1, 2026.

Maurice Wutscher Impression

The Montana law is very similar to the non-California data privacy laws recently enacted, so it should cause few additional compliance challenges.

For a chart comparing the state comprehensive data privacy acts, and more information and insight from Maurice Wutscher on data privacy and security laws and legislation, click here.

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Why Can’t Courts Agree to The Definition Of Debt Collector?

It’s been 46 years since “debt collector” was defined in the federal Fair Debt Collection Practices FDCPA (FDCPA) so why do courts still disagree with its meaning?  One reason may be that the FDCPA was enacted prior to the maturation of the consumer debt buyer industry, leaving the FDCPA’s legislative history void of any discussion regarding whether a buyer of consumer debt is a ‘debt collector.’ Courts have been filling in the gap; however, the lack of consistency in their decisions continues to burden litigants and the court system.

The existence of so-called passive debt buyers has increased exponentially since the passing of the FDCPA.  A passive debt buyer is an entity that purchases debt portfolios of defaulted charged off accounts owed by consumers, and then contracts third party vendors, usually licensed collection agencies or collection attorneys, to attempt to collect the defaulted accounts. These entities are considered ‘passive’ because they do not collect their own debt; the third parties handle all aspects of collecting debts.

Though the debt buyer industry has become prolific, Congress has not, to date, considered whether passive debt buyers should be considered debt collectors within the meaning of the FDCPA.  Courts have tried to answer that question, but their decisions are not uniform, making it difficult for anyone to discern the true meaning of ‘debt collector.’  This article addresses with some of these cases and offers a suggestion how debt buyers should be described by the courts.

The FDCPA is dated. It was approved on September 20, 1977.   It’s purposes are to eliminate abusive practices in the collection of consumer debts, to promote fair debt collection, and to provided consumers an ability to dispute and otherwise obtain the validation of debt.  However, the FDCPA has two potential definitions of ‘debt collector.’

Debt Collector means [first] “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts (“the Principal Purpose test”), or [second], [one] who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another (“the Regularly Collects test”)…….”

Who qualifies as a debt collector is an issue raised by litigants that courts must address frequently.  As Congress never considered how to describe passive debt buyers under the FDCPA, Courts must attempt to decide whether passive debt buyers are debt collectors under the FDCPA. Recent cases include Campbell v. LVNV Funding, LLC., 2022 WL 96172286 (2022); Young v. Midland Funding,  84 Cal.App.5th 34 (2022); and Endres v. UHG I LLC, 2022 WL 462005 (2022).  Two of these cases support the proposition that a passive debt buyer is a debt collector under the Principal Purpose test.  The issue will continue to be raised until the U.S. Supreme Court settles the controversy over the Principal Purpose test or Congress amends or otherwise clarifies the FDCPA.

In the U.S. Supreme Court case, Henson v. Santander, 137 S. Ct. 1718 LLC,(2017), the court determined whether a party that purchases a consumer debt, and then attempts to collect it, is a debt collector within the meaning of the FDCPA.  The Court interpreted the Regularly Collects test only and declined to analyze the Principal Purpose test.  The Court ruled that when one purchases a debt originated by someone else, thereby owns it after purchase, and then seeks to collect that debt for its own account, the entity does not fall under the Regularly Collects test.  It is, therefore, not a debt collector.  The Court rationalized that because the debt buyer is the current owner of the debt, and is collecting the debt, the current debt owner is collecting its own debt.  Unlike lower courts, the Henson court, with respect to the definition of debt collector, does not distinguish between a company that buys charged off debts and a company that buys debts on which the consumers are still paying.  A debt is a debt. 

Since Henson, few courts have interpreted the Principal Purpose test.  Two courts that have interpreted this test have reached opposite conclusions.  In Barbato v. Greystone Alliance, 916 F.3d 260 (3rd Cir 2019), the Third Circuit side-stepped the plain and unambiguous meaning of the statute.  Rather, this court interpreted the statute and concluded that the Principal Purpose test includes passive debt buyers even though the owners of these assets do nothing to collect the claims other than hire third party debt collectors. 

Even though the U.S. Supreme Court in Henson clearly states that the FDCPA is meant to reach those that directly contact the account debtors, the Barbato Court finds that the same language is farther reaching and meant to include indirect acts, like those of a passive debt buyer hiring a third party debt collector.  The court in Barbato reasons that the FDCPA does not limit the definition of debt collector to the ones that take the direct actions. Rather, it includes any person or entity that uses instrumentalities of interstate commerce, whether direct or indirect. Unfortunately, the U.S. Supreme Court did not take this decision on appeal.

In Dorrian v. LVNV Funding, LLC, 479 Mass. 265 (2018), the Court considered whether the defendant qualified as a debt collector under the FDCPA, the Massachusetts Debt Collections Practices Act (“MDCPA”) and Massachusetts Consumer Protection Act (“MCPA”).  The MDCPA and the FDCPA define a debt collector in the same manner.  In this case, the defendant, a passive debt buyer, did not attempt to collect any of the debts it acquired.  Consequently, it could not be licensed as a debt collector under Massachusetts law.  

The plaintiff claimed that the defendant was a debt collector as defined by the FDCPA, MDCPA, and MCPA.  That by not being licensed as a debt collector, the defendant was in violation of the law. The Dorrian Court dissected the plain language of these statutes and found it “instructive but not conclusive” as to whether a passive debt buyer is a debt collector. Rather, the Court relied on the opinion of the Massachusetts Division of Banks interpretation of the FDCPA which drew a line between passive debt buyers and debt collectors by whether or not they are directly involved in collection activities with consumers. The Court reasoned that the FDCPA is meant to stop the harassing and abusive acts aimed at consumers. Consequently, an entity must take direct actions against a consumer debtor to be defined as a debt collector under the Principal Purpose definition. 

The two courts also disagree on the meaning of the “principal purpose” of a passive debtor buyer. The Barbato Court decided that if a party’s most important aim is the collection of debt, then the party is a debt collector. The Barbato Court reasoned that because the company would cease to exist if it did not have its purchased debt collected, then it is a debt collector. This is an oversimplification of a passive debt buyer’s business. The Dorrian Court reasons that a passive debt buyer’s business is to invest capital in debt, and its profits are derived from the eventual collection of debt. However, the Dorrian Court notes that the passive debt buyer takes no action to collect the debt. The collection of the debt is completely contracted to a third party. The third party undertakes all aspects of the debt collection.

The primary purpose of a company that may buy debt is to gather investment money or other money drawn from lines of credit. Once the company gathers that money, it has to find investment opportunities. After a tranche of debt is purchased, the new owner needs to contract with third parties to collect the debt portfolio. If one was to reasonably apply the principal purpose test, the so called principal purpose of these companies is to raise money to purchase assets that return a dividend to its shareholders.  

The Barbato Court is correct in stating that the passive debt buyer would cease to exist if its agents do not collect debts, but wouldn’t every lending institution fail if it ceased to receive a return on its loans? A bank lends money to businesses and consumers in the hopes of seeing a return on its investment. To do so, it needs to collect promissory notes and realize profits on bank investments. If it fails to do so, the bank too will fail. Would that make the bank a debt collector? Also, to state that a passive debt buyer is a debt collector simply because it chooses to invest in debts would be incorrect. If someone chooses to invest in a retail store, is that investor now in the retail business? If an investor chose to invest in a car company, would he now be a car maker? No, we would not say that unless, the shareholder takes some direct action to build a car or run a retail store. 

The Hensen Court, Dorrian Court, and Barbato Courts agree that Congress intended to end unfair and deceptive practices of debt collectors when communicating with consumers. The Courts also agree that since the passing of the FDCPA, one of the largest changes was the creation of a debt buying market. There is nothing in the legislative history that shows that Congress ever considered debt buyers when it passed the FDCPA. The Barbato Court speculates that treating passive debt buyers as debt collectors furthers Congress’ intent to stop abusive and deceptive debt collections practices. The Dorrian Court disagrees. Without analyzing the Principal Purpose test the U.S. Supreme Court in Henson disagrees as well.

As the Hensen Court states people can reasonably disagree over whether Congress should change the FDCPA to include more parties within the definition of debt collector.  “…it’s hardly unknown for new business models to emerge in response to regulation, and for regulation in turn to address new business models. Constant competition between constable and quarry, regulator and regulated, can come as no surprise in our changing world. But neither should the proper role of the judiciary in that process—to apply, not amend, the work of the People’s representatives.” Henson, 582 U.S. 79, 90, 137 S. Ct. 1718, 1725–26, (2017).

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Beam Software Partners with Resolv Global to Address Labor Shortage in the ARM Space

SARASOTA, Fla. — Beam Software, a thought leader and problem solver in the debt purchasing and collection software markets, has addressed the Great Resignation and the return-to-work issue for its collection agency customers by partnering with Resolv Global, an international Call Center as a Service (CCaaS) solution provider.  

Beam Software customers have indicated that one of their most rampant issues is they cannot find and retain collectors. To solve that problem Beam Software and Resolv Global have teamed up to create a pool of call center agents with experience in collections as well as knowledge of how to use the BEAM collection system. Beam customers use the Resolv Global Call Center as a Service solution to contract point callers, skip tracers, and collectors.

“Changes in employment patterns and behaviors sparked during COVID, record low unemployment rates, and collector shortages, continue to affect all collection agencies, not just BEAM users.” said Thomas Mohr, Chief Revenue Officer at Beam. “By referring Resolv Global call center agents as contractors, we can help collection companies save anywhere from 30% to 40% over the cost of hiring a traditional onsite collector.”

Resolv Global is uniquely positioned as an offshore and nearshore CCaaS solution with call centers in South Africa and Columbia.  “South Africa is a leading worldwide destination for call center and BPO solutions based on its neutral English accent, large, educated talent pool, and above average staff retention rates.” said Dr. Louis Siebrits, co-founder of Resolv Global. 

Resolv Global employs champion-challenger strategies between its call centers in Cape Town, Durban, and Johannesburg to promote best-in-class performance for its clients. Resolv Global provides what it calls hot seat allocation to support real-time capacity exchange based on the demand for agents. Dr. Siebrits added “Collection agents are already trained on each client’s specific use of their BEAM platform and have passed our FDCPA compliance certification test so they can hit the ground running and be immediately productive.”

About Beam Software

Beam Software is a subject matter expert on purchased receivables and collections software and prides itself on creatively solving problems for its customers.  Its product development team is a Microsoft Solutions Partner, and its management team has 81 years of combined industry experience.  For more information, visit www.beamsoftware.com or call (866) 620-3445.

About Resolv Global

Resolv Global is a leading Call Center as a Service solution provider with call centers throughout South Africa and Columbia. The company provides agents for point calling, skip tracing, collections, and customer service, all of which can be available 24/7. Resolv offers hands-on management and KPI reporting  to drive effectiveness and ensure profitability for its clients. For more information, call (888) 472-4528 or visit www.resolv.global.

Beam Software Partners with Resolv Global to Address Labor Shortage in the ARM Space
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CFPB Brief Defends Funding Structure

On May 8, petitioner CFPB filed its brief with the U.S. Supreme Court, criticizing the U.S. Court of Appeals for the Fifth Circuit’s decision in Community Financial Services Association of America v. Consumer Financial Protection Bureau, where the appellate court found that the Bureau’s “perpetual self-directed, double-insulated funding structure” violated the Constitution’s Appropriations Clause (covered by InfoBytes here and a firm article here). The 5th Circuit’s decision also vacated the agency’s Payday Lending Rule on the premise that it was promulgated at a time when the Bureau was receiving unconstitutional funding. 

Earlier this year, the Bureau filed a petition for a writ of certiorari, which the Court granted (covered by InfoBytes here). The Bureau explained in its petition that the 5th Circuit’s decision would negatively impact its “critical work administering and enforcing consumer financial protection laws” and “threatens the validity of all past CFPB actions as well” as the decision vacates a past agency action based on the purported Appropriations Clause violation. 

Community Financial Services Association of America (CFSA) filed a conditional cross-petition, seeking review on other aspects of the 5th Circuit’s decision, including that the 5th Circuit’s decision does not warrant review because the appellate court correctly vacated the Payday Lending Rule, which, according to the respondents, has “multiple legal defects, including but not limited to the Appropriations Clause issue.” (Covered by InfoBytes here.)

In its opening brief, the Bureau expanded on why it believes the 5th Circuit erred in its holding. The Bureau argued that the text of the Appropriations Clause “does not limit Congress’ authority to determine the specificity, duration, and source of its appropriations.” The agency further explained that Congress has chosen similar funding mechanisms for many other financial regulatory agencies, including the FDIC, NCUA, FHFA, and the Farm Credit Administration (and agencies outside of the financial regulatory sector), where they are all funded in part through the collection of fees, assessments, and investments. 

The Bureau emphasized that the 5th Circuit and the CFSA failed “to grapple with the Appropriation Clause’s text, Congress’ historical practice, or [Supreme] Court precedent,” but instead asserted only that the funding mechanism was “unprecedented.” “Congress enacted a statute explicitly authorizing the CFPB to use a specified amount of funds from a specified source for specified purposes,” the Bureau emphasized. “The Appropriations Clause requires nothing more.” The 5th Circuit’s “novel and ill-defined limits on Congress’s appropriations authority contradict the Constitution’s text and congressional practice dating to the Founding.”

The Bureau also addressed the now-vacated Payday Lending Rule. Arguing that even if there were some constitutional flaw in 12 U.S.C. § 5497 (the statute creating the Bureau’s funding mechanism), the 5th Circuit should have looked for some cure to allow the remainder of the funding mechanism to stand independently instead of “adopting an unjustified and profoundly disruptive retrospective remedy” and presuming the funding mechanism created under Section 5497(a)-(c) was entirely invalid. The Bureau also stressed that vacatur of the agency’s past actions was not an appropriate remedy and is inconsistent with historical practice. Adopting a remedial approach, the Bureau warned, would inflict significant disruption by calling into question 12 years of past agency actions.

The Bureau urged the Court to at most grant only “prospective relief preventing the CFPB from enforcing the Payday Lending Rule against [CFSA] or their members until Congress provides the Bureau with funding from another source.” While such an approach could still “upend” the Bureau’s activities, “it would at least avoid the profoundly disruptive effect of unwinding already completed and concededly authorized agency actions like the Payday Lending Rule,” the Bureau wrote, adding that “[v]acatur of the CFPB’s past actions would be inappropriate in light of the significant disruption that such vacatur would produce.”

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‘Tennessee Information Protection Act’ with NIST Security Standards Enacted

Tennessee Gov. Bill Lee on May 11 signed into law House Bill 1181, making Tennessee the eighth state to enact a comprehensive consumer data privacy law, following California, Virginia, Colorado, Utah, Connecticut, Iowa, and Indiana. The law will take effect July 1, 2024.

Privacy Program

Under the new law, controllers and processors must create, maintain, and comply with a written privacy program that reasonably conforms to the National Institute of Standards and Technology (NIST) Privacy Framework entitled “A Tool for Improving Privacy through Enterprise Risk Management Version 1.0,” and update the program as the Framework is revised.   

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Applicability

The Act applies to persons that conduct business in Tennessee or produce products or services that are targeted to residents of Tennessee and that:

  1. During a calendar year, control, or process personal information of at least 100,000 consumers; or
  2. Control or process personal information of at least 25,000 consumers and derive more than 50% of gross revenue from the sale of personal information.

Exemptions

Importantly, the Act exempts financial institutions and affiliates, or data subject to the Gramm-Leach-Bliley Act. Other exemptions include covered entities or business associates governed by the privacy, security, and breach notification rules issued pursuant to the Health Insurance Portability and Accountability Act, and the use of personal information to the extent the activity is regulated by and authorized under the Fair Credit Reporting Act.

Consumer Rights

Consumers are provided the right to:

  1. Confirm whether a controller is processing the consumer’s personal information and to access the personal information;
  2. Correct inaccuracies in the consumer’s personal information;
  3. Delete personal information provided by or obtained about the consumer;
  4. Obtain a copy of the consumer’s personal information that the consumer previously provided to the controller;
  5. Request that a controller that sold personal information about the consumer, or disclosed the information for a business purpose, disclose the: (i) Categories of personal information the business sold; (ii) Categories of third parties to which the personal information was sold; (iii) Categories of personal information disclosed for a business purpose;
  6. Opt out of the sale of personal information.

Sensitive Data

A controller may not process “sensitive data” without a consumer’s consent.

“Sensitive data” includes:

  1. Personal information revealing racial or ethnic origin, religious beliefs, mental or physical health diagnosis, sexual orientation, or citizenship or immigration status;
  2. The processing of genetic or biometric data for the purpose of uniquely identifying a natural person;
  3. The personal information collected from a known child; or
  4. Precise geolocation data.

Contract Requirements

A contract between a controller and a processor must clearly set forth instructions for processing data, the nature and purpose of processing, the type of data subject to processing, the duration of processing, the rights and obligations of both parties, and require that the processor:

  1. Ensure that each person processing personal information is subject to a duty of confidentiality with respect to the data;
  2. At the controller’s direction, delete or return all personal information to the controller as requested at the end of the provision of services, unless retention of the personal information is required by law;
  3. Upon the reasonable request of the controller, make available to the controller all information in its possession necessary to demonstrate the processor’s compliance with the obligations in this part;
  4. Allow, and cooperate with, reasonable assessments by the controller or the controller’s designated assessor;
  5. Engage a subcontractor pursuant to a written contract in accordance that requires the subcontractor to meet the obligations of the processor with respect to the personal information.

Data Protection Assessments

A controller must conduct and document a data protection assessment if the processing involves

  1. targeted advertising;
  2. the sale of personal information;
  3. certain profiling;
  4. sensitive data;
  5. activities involving personal information that present a heightened risk of harm to consumers.

Enforcement

The Attorney General has the exclusive authority to enforce the Act. Prior to taking any action, the Attorney General must provide a controller or processor 60 days to cure the violation. In the absence of a cure, civil penalties up to $15,000 may be sought for each violation.

Maurice Wutscher Impression

The Tennessee Act is similar to the other non-California data privacy laws recently enacted, though the requirement to have a privacy program based on the NIST Framework is unique.

The Framework was developed by a private-public collaboration that began in 2018, and “is a voluntary tool intended to help organizations identify and manage privacy risk so that they can build innovative products and services while protecting individuals’ privacy.”

For a chart comparing the state comprehensive data privacy acts, and more information and insight from Maurice Wutscher on data privacy and security laws and legislation, click here.

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