Archives for July 2019

Today, the Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission (FTC) and a large group of state attorneys general announced that they reached a global settlement with Equifax over its 2017 data breach. Among other relief, the $700 million settlement includes $450 million in monetary relief to consumers and $100 million in civil penalties.

The Equifax data breach, which spanned from May to July of 2017, compromised the sensitive data of 147 million consumers. The CFPB’s complaint against Equifax alleged that the credit reporting agency engaged in unfair and deceptive practices, including not having reasonable security measures for mass quantities of sensitive data and the company’s privacy policy deceiving consumers about the strength of its data security programs.

The monetary relief portion of the settlement aims to reimburse consumers for lost time related to credit monitoring, protecting their personal information, and costs related to identity theft of affected consumers. Affected consumers will also receive at least 10 years of free credit monitoring and 7 years of identity-restoration services. Additionally, for 7 years, all U.S. consumers may request up to 6 free copies of their Equifax credit report per year in addition to any free credit reports they are already entitled to.

[article_ad]

insideARM Perspective

The Equifax data breach was undoubtedly one of the larger data security events to hit the financial services industry. While not nearly at the same scale as the Equifax breach, the AMCA breach is one of the larger breaches to be reported in the ARM industry. While it might seem that these two events are worlds apart, the two breaches occurred roughly a year apart—mid-2017 for Equifax, late 2018 and early 2019 for AMCA. Data security has always been an important factor in the ARM and financial services industries, and these two data breaches only accentuate how vital it is to be on top of data security measures.

ST. LOUIS, Mo. — National Loan Exchange, Inc. (“NLEX”), a leading loan sale advisor, announced multiple developments demonstrating the firm’s commitment to best in class services and maintaining their position at the forefront of compliance within the loan sales marketplace. 

“To ensure our data security and operational controls go beyond industry standards, I.S. Partners [the third-party audit firm] conducted the SOC2 Type I based on both the confidentiality and privacy trust service principles, and found our controls meet the thresholds with no findings” said Tom Ludwig, NLEX’s General Counsel and Executive Vice President. “Completing the audit is a testament to NLEX’s commitment to security, compliance and operational excellence. Our clients rely on NLEX to maintain strict security controls so they can pass that peace of mind on to their own customers.”

NLEX also announced its decision to consider the Receivables Management Association International’s (RMAI) broker certification. NLEX provided RMAI with comments leveraging their 25 years to update the certification program to allow for brokers with high profile clientele such as NLEX to consider the program while continuing to promote the RMAI mission of transactional best practices.  Ludwig continued, “we commend the RMAI on their efforts to implement standards that enhance consumer protections through rigorous and uniform industry best practice standards, not just with respect to the broker certificate, but the certification program in general.

In addition to the success of our SOC2 and multiple large creditor audits, we look forward to further discussion on the RMAI broker certificate to consider adding it to our list of compliance achievements.”

About NLEX

National Loan Exchange, Inc. (NLEX) is a leading loan sale advisor in the United States and Canada. Over the course of 25 years, NLEX has closed more than 5,000 sales representing over $150 Billion in transactions. Our leadership and sales teams have a combined history in excess of 150 years in the financial services industry. NLEX offerings include national, state, and regional portfolios on behalf of many of the world’s top financial institutions.  NLEX is a wholly-owned subsidiary of Heritage Global, Inc., a value-driven, innovative leader in asset valuations and transactions.  Visit www.nlex.com and www.heritageglobalinc.com for more information.

About I.S. Partners

I.S. Partners, LLC is a CPA firm specializing in SOC, PCI-DSS and HITRUST examinations using a simplified audit solution model, offering guidance from start to finish to allow for optimum quality and client experience for organizations of every size and complexity. The unique technology-driven process offers a streamlined, client-focused suite of risk and compliance audit and assessment services to help businesses meet specific goals. Visit www.ispartnersllc.com for more information.

Today, we are going to talk about your collections strategy and ensuring your collections treatment is effective and efficient.

Payment Terms

This is the net terms on the account that you can expect to receive payment from your customer. This is an area glossed over far too often in the customer onboarding process. Historically, businesses have used “default” net 30 payment terms: 30 days from the date of the invoice, payment is due. This was the standard for most businesses prior to the recession in 2008. Many businesses tightened their default terms and how they extended credit. In my collections strategy workshop, I talk a lot about the art of collections. After attending our strategy workshop, I’m confident that you will look at the collections department and processes entirely differently. You will learn how to run credit and collections in a strong economy and how to quickly adapt to a weaker economy. Payment terms are the key ingredient to a successful collection strategy and here is why.

Controllable Strikes

Strikes are missed opportunities with your customers. Start (or continue) reiterating to your sales force how customers give us controllable strikes — strikes that don’t hit the company as a surprise or, in the best-case scenario, can be avoided entirely. Depending on the customer, you may get one strike or maybe they are really nice and give you three. Strikes are also reasons for a customer to stop working with you early in the relationship. Let me show you how it relates back to payment terms.

• The invoice payment terms aren’t appropriate for the customer’s process.
• Week 1: Brian in the warehouse has to sign off on all invoices.
• Week 2: Suzy in operations reviews Brian’s notes and invoices prior to sending to accounting.
• Week 3: Accounting reviews the bills and e-mails them electronically to corporate for processing.
• Week 4-5: The CFO cuts check every other Thursday and mails payment.

• Phone rings to Accounting. It’s your collector calling for the status of the payment.
• Strike 1. You didn’t ask the customer what their process was once the bill is received. It’s very clear to see based on their process, you couldn’t possibly have their payment on net 30. They are agitated because someone just had to answer your collectors call unnecessarily.
• Strike 2. Remember the door that was ordered in the wrong size.
• Strike 3. While they are on the phone with your collector they also notice, pricing on the invoice wasn’t what was promised.

If you are lucky, maybe you get a foul ball instead of the strike, but look how fast you can lose that customer. Payment terms are a controllable strike that you can save by teaching this to everyone in your organization involved with bringing on new business.

Best Customer Experience

Multiple studies show that customers are more loyal to companies that give them the best customer experience. How your collector interacts with the customers is a part of their overall experience with you as a company. If your collectors are calling your customers when they aren’t really past due, the collector will hear the customer’s thoughts on that call.

As an organization, your employees are your customers as well. Is your collector as driven in their day to day, if they are getting scolded by customers that aren’t really past due? In making sure this is the best experience for your customers, you are improving your employee’s experience as well.

Most collectors have KPI’s (key performance indicators) and are motivated (sometimes additionally compensated) for hitting their goals. All employees want minimal roadblocks in achieving their KPIs. Let’s set both the customers and the collectors up for success!

Time is money

Your collector calling a customer that didn’t need to be called is a waste of both their time and the organization’s money. A collector is going to look at their coded accounts and if payment terms aren’t discussed on the front end, they will struggle to prioritize. Think about that, they can’t tell from looking at their worklist who is correctly reflecting past due and who is inaccurately reflecting past due. They will spend more wasted time shifting through making phone calls. Some of those calls accurately reflecting past due and other customers getting more frustrated with their unnecessary calls. If the collector could look at their worklist with confidence, they would know all the past due customers were accurate.

Don’t lose sight of the domino effect here. If the customers don’t have the right payment terms, your cash forecasts and projections won’t be correct. Your DSO will show poorly, AR aging won’t reflect the correct picture, and it will impact your financials.

It’s never too late

• Historically, how many days past due is the customer paying today? If the customer has net 14 terms and historically is paying 30 days past due, they really need net 45 terms.
• Your collectors next phone call:

• “Hello Mr./Mrs. Customer, I was reviewing your account prior to calling today. I noticed that historically your payment has posted 30 days past the due date. Can you walk me through your internal process?”
• “Understood, let me review these notes with my manager and see what new payment terms and options we have for you. We want to see you continue maximizing your discounts through us and show in good payment standing.”
• “Lastly, if I’m able to make this change in our system for you I need your commitment that you won’t change your process today. We want to set you up for success, and the only way to accomplish that is if we have your companies commitment to maintaining your current process. You can still expect to receive calls from me from time to time before a scheduled vacation, holiday, etc.”

• Once the change is approved, follow back up with the customer. Set clear expectations.

• “This week’s invoice won’t reflect the change. However, starting next week the new payment terms will be reflected. As I said continue processing our invoices on your end the same way, and the account will remain in good standing.”
• “You can still expect to receive calls from me from time to time before a scheduled vacation, holiday, etc. This ensures we don’t get off track with payments with those scheduled interruptions.”

Payment terms are so important to the success of our organization, customers, and employees. Customers will appreciate you taking the time to understand their processes and being adaptable to collaborating on agreed terms that work for both companies. Collectors can now effectively and efficiently work on their past-due customers and with a positive attitude. You are giving your customers the best customer experience, and happy customers are sticky customers. Trust me, there will still be uncontrollable strikes that happen from time to time. But your customer won’t be adding unnecessary phone calls, collection letters, etc. when they do. The customer is more likely to shrug it off, no business is perfect but I really enjoy working with the company! Sticky customers today, plus new sticky customers tomorrow equals compounded revenue and growth for your organization’s future!

I hope you see purposeful decision-making throughout the steps mentioned above. If not, feel free to reach out to me via email at keich@theiainstitute.com. I would love to hear your thoughts. Even better, #ChimeIn on my personal LinkedIn page where this article will be shared and published for open comments.

I look forward to seeing you at our upcoming strategy workshop this December in Scottsdale, Arizona, and helping your organization maximize revenue without increasing your bad debt!

You may not realize that while the debt collection community has focused on the CFPB’s rulemaking, robocall blocking, data breaches and impending data privacy laws, the war between private collection agencies (PCAs) and the Department of Education’s (ED) Department of Federal Student Aid (FSA) continues to be waged in the Court of Federal Claims (COFC). The last few weeks have produced a lot of activity, with some kind of ruling expected in the coming days.

[article_ad]

What’s the context?

There are actually two intersecting matters in play.

First is the suit regarding ED’s May 2018 cancellation of its Solicitation for large PCA services; In September 2018, the court ruled in favor of the PCAs and permanently enjoined ED from canceling the Solicitation. The PCAs argue, however, that ED has essentially ignored this order and proceeded with the cancellation. If you need a full recap, this story is a great place to start.

Second is the protest of ED’s (separate) Solicitation for services under its NextGen plan that would put all federal student loan servicers on a common technology platform with a single database. The PCAs’ complaint in this case is that ED has improperly bundled pre-and post-default servicing in the same procurement, which is a) illegal and b) makes it impossible for debt collectors to compete for work unless they can either a) provide all services required by the full student loan cycle (which, it’s argued, no company is capable of) or b) establish a viable teaming arrangement as a subcontractor (which, it’s argued, is both challenging and would cause a conflict of interest). The case is FMS Investment Corp., et al., v. United States; ConServe filed a complaint on the same day in October 2018 as FMS and their cases were consolidated. This article provides a great background on the twists and turns to date.

So, what’s happened recently?

On April 16, 2019, Judge Wheeler denied the PCAs’ motion to prevent a recall of the accounts held by large collection agencies that held now-expired Award Term Extensions (ATEs). Some co-plaintiffs felt this meant the end of the road; reluctantly, they said “uncle”. On May 20, 2019 Account Control Technology (ACT) filed a Notice of Voluntary Dismissal and on May 23, 2019 Windham Professionals did the same.

Others charged ahead; FMS, GC Services, and ConServe filed (sealed) motions for judgment on the administrative record (MJAR) on June 3, 2019.

Additional sealed motions, as well as some scheduling delays, were filed between June 19 and July 12, 2019.

On Tuesday, July 16, Continental Service Group (ConServe) filed a redacted but unsealed response to the Department of Education’s (ED) cross-motion for judgment on the administrative record. 

In the redacted document, ConServe offers a scathing recap of ED’s actions over the last several years and requests that the court 1) forces ED to issue a separate solicitation for default collection services under NextGen and 2) again enjoins ED from cancelling the Default Collection Procurement until ED procures default recovery services separately from other services (under NextGen or otherwise). The following excerpt from the 31-page response is representative of its full content:

While most of the original Private Collection Agencies protesters seemingly have abandoned hope and their protests, ConServe is committed to restoring integrity to the procurement process, exposing ED’s egregious behavior, and to ensuring that it is afforded a fair opportunity to compete. ConServe requests that the Court enjoin this procurement from proceeding on this illegal course.

ED’s most recent display of disingenuous and misleading behavior is documented in its latest filing. Rather than recognize the procurement violations and take corrective actions, ED approaches the danger presented by ConServe’s arguments much like an ostrich, wholly ignoring the matter hoping they will go away, or alternatively, advancing disingenuous positions.

What’s next?

There was a hearing at the COFC yesterday to hear arguments. Sources tell me that a decision on the NextGen bundling matter is expected in the coming days. It’s unclear what will happen in the matter of the cancellation of the original Solicitation for large PCA services. Stay tuned.

Yesterday, the full House Committee on Energy and Commerce approved a further amended Stopping Bad Robocalls Act, H.R. 3375, by a unanimous voice vote. Before doing so, the full Committee approved, again by unanimous voice vote, three amendments to the version forwarded by its Subcommittee on Communications and Technology on June 25.

First, Committee Chairman Frank Pallone (D-NJ), along with Ranking Member Greg Walden (R-OR), offered a Managers Amendment that made modest changes to Sections 2, 4, 8 and 13 of the bill. One of the changes addresses a concern about the effective date of Section 4 dealing with the Federal Communications Commission’s (FCC) reassigned number database and the definition of “called party.” The amendments   regarding clarification of that definition would now become effective beginning on the date when the reassigned number database “becomes fully operational such that a person may check the database to determine the last date of disconnection associated with a phone number.”

Second, the Committee approved an amendment offered by Representatives Debbie Dingell (D-MI) and Michael Burgess (R-TX) that would require the FCC to establish an advisory committee to be known as the “Hospital Robocall Protection Group.” The Group would be charged to develop best practices that, for example, address how voice service providers can better combat unlawful robocalls made to hospitals. The FCC ultimately would have to conduct a proceeding to assess the extent to which the voluntary adoption of such best practices can be facilitated to protect hospitals and other institutions.

Third, the Committee approved an amendment offered by Representatives Bill Flores (R-TX) and Jerry McNerney (D-CA) that would allow the addition of up to US$10,000 to a potential forfeiture penalty under Section 503(b) of the Communications Act for “robocall violations with intent.”

The markup up session can be viewed here.

Subject to the Committee’s Report, the bill, which currently has 153 supporting House Members, moves on for action on the floor of the House. Stay tuned.

—

Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved.  

ARLINGTON, Va. and LOWELL, Mass. — Numeracle^™ Inc., the pioneer of robocall blocking and labeling visibility and control in the calling ecosystem, and NetNumber, the world’s leading provider of next-generation centralized addressing, routing and database solutions to the global communications industry, today announced a partner objective to deploy Numeracle’s Trusted Entity^™ and phone number data onto NetNumber’s Global Data Services platform as the Trusted Entity Registry to identify trusted callers in support of industry-wide efforts around SHAKEN/STIR and default call blocking objectives. 

As the only solution provider offering entities the ability to register phone numbers and certify the Trusted Entity status of their organizations, Numeracle provides a single path to proactively identify legitimate entities and prevent the improper blocking of legal, wanted calls across multiple carriers and service providers. The Trusted Entity Registry will expand the reach of Numeracle’s existing platform to identify organizations such as emergency services, schools, businesses, healthcare providers, financial establishments, retailers, resorts, charities, or any entities whose calls are not the intended target of the FCC-approved default call blocking ruling.

“With the FCC’s approval of default call blocking at the carrier-level, the need for such a solution to ensure legal, wanted calls are not unintentionally blocked is a matter of urgency and necessity for the telecom industry,” said Rebekah Johnson, Founder & CEO, Numeracle. “By carrying out our vision of integrating with NetNumber, we are creating the ideal vehicle for entities to register phone numbers and establish trust in their calls utilizing NetNumber’s expansive reach to carriers and service providers. This solution will enable the carriers to move forward with more aggressive call blocking tools while formalizing the redress mechanisms for entities who are erroneously blocked.” 

The Trusted Entity Registry will be delivered as an extension of NetNumber’s well-known GDS platform as a free cloud service made available to communication service providers and analytics engines to ensure critical, trusted communications are not blocked. This solution creates a direct line of access to verified, legal caller identification data for both terminating and originating carriers. The Trusted Entity Registry is being provided by Numeracle and NetNumber at no charge to service providers and analytics engines that need the information to avoid inappropriate blocking of wanted and critical calls.  

While the immediate benefit of this relationship works to prevent the erroneous blocking of critical, wanted calls, this solution positions both companies to continue focus on innovating further solutions to strengthen SHAKEN/STIR. 

“NetNumber has been actively engaged in working with the SHAKEN/STIR framework in support of our service provider and carrier customers. Adding the Trusted Entity Registry to our product line is a logical next step in the evolution of a broader SHAKEN/STIR solution.  Numeracle is the perfect partner to provide the vetted calling-party data to help the industry to move towards a model of end-to-end trust,” said Doug Ranalli, NetNumber’s Founder and VP of Global Data Services. “This partnership paves the way to strengthen the SHAKEN/STIR framework beyond the baseline of preventing the illegal spoofing of phone numbers to actually delivering the vetted identity data required to give consumers confidence in who is actually on the other end of the call.” 

To learn more about NetNumber’s Global Data Services solution, the foundational building block of the NetNumber Trusted Entity Registry, visit www.netnumber.com. For more insight into Numeracle’s mission to proactively identify trusted entities across the healthcare, financial, utility, retail, resort, and public service industries, visit www.numeracle.com. 

About NetNumber

NetNumber, Inc. brings nearly 20 years of experience delivering platforms that power global telecom and enterprise networks. Our software-based signaling-control solutions accelerate delivery of new services like Private LTE and IoT/M2M solutions across multi-gen networks, dramatically simplifying the core and reducing opex. These solutions span a range of network types from 2G-3G-4G-5G to future G delivered on the industry’s first All-G signaling platform called TITAN. NetNumber Data Services are essential for global inter-carrier routing, roaming, voice and messaging. Data powers fraud detection and prevention solutions and enables enterprise B2B and B2C communications platforms. NetNumber multi-protocol signaling firewall, fraud-detection, and robocalling solutions secure networks against current/emerging threats. 

About Numeracle 

Numeracle is working with major carriers, device manufacturers, app developers and industry leaders to deliver a path to visibility and control into the new calling ecosystem. Through the company’s technology vision and industry leadership, Numeracle is laying the foundation for returning trust and transparency to customer communications. To learn more about Numeracle’s call blocking and labeling solutions for call originators and call centers, visit www.numeracle.com.

Editor’s Note: This article was authored by Josh Allen, Revenly’s Founder & CEO, and reflects the opinions of the author. It previously appeared on the Revenly blog and is republished here with permission. 

How are you putting together your digital strategy? Are you exploring new communication channels such as texting, email, and chat? With a little research, you can put together a strategy that delivers real results, proven by those before you.

‍Identify What You’re Looking For

You may be looking at implementing email, SMS, chat or just redoing your website for consumers. Whatever it is, start by making sure you aren’t skipping ahead of the essentials.

If you don’t already have a dedicated payment page for consumers, you need to get one. Accounts receivable is about collecting payments and, without an online payment platform, all the other services you try to implement will have trouble standing alone. It’s essential to ensure the online payment platform is secure, especially considering the recent data breach that attacked a healthcare collection agency’s online payment page.

You should also have a dedicated, mobile-friendly online presence where consumers are directed to go. Do not direct them to the corporate site you use to attract new clients and hide the “Pay Now” button where it is hard to find. This one step alone—creating a dedicated consumer landing page—will give you a noticeable lift in the consumer online experience. Once you have that in place, you can start thinking about other channels you want to activate. Some solutions provide a single platform with channels seamlessly integrated so you can activate when ready. Or you can source your own.

[article_ad]

Follow the Results. Ask for Proof.

Familiarize yourself with terms used in e-commerce such as conversion rate, bounce rate, exit page, average time on site, return rate, and other similar terms. There are literally hundreds of them. It would be beneficial if you knew how to track traffic on your website using Google Analytics (which is free) and if you used services that deliver performance data.

Whether you are building or buying—but especially if you’re buying—you need to know how new technology provides you with a better ROI. Analytics both prove and improve this. A company selling SMS by telling you that 98% of text messages are opened means absolutely nothing if there is no action following up that open.

Did you know that people who opt themselves into SMS alerts have a higher propensity to sign up for AutoPay? That fact can be backed up with real data. Make sure you seek out the correlating proof that a new channel will provide you with an ROI worth your time (and money).

Talk to a Specialist. We Really Mean It.

It’s an exciting time to embrace new businesses processes. Flashy marketing and conference panels with buzzwords in the title are everywhere, but does anyone have any real experience? Make sure that the people you’re taking payment portal advice from use one themselves and got it to work for them. Not at 5% of payments, not at 10% of payments, but at the very least over 20% (with a goal of over 50%). That says they put the resources into it.

‍Find a specialist outside of the industry too. Chat is a great example. Companies like Drift and Intercom are amazing services that have AI built right in. Get perspective from companies who help e-commerce stores. People are people, a lot of these techniques transfer.

‍Crawl. Walk. Run.

This one is simple. You might be ready to run, but is the rest of your team ready?  Make sure everyone is on board, test, test again, and then scale. What good is all this new technology if you aren’t ready to use it?

The full House Committee on Energy and Commerce is holding a markup this morning of a list of some 26 bills, with the first on the list being the Stopping Bad Robocalls Act, H.R. 3375. As you may recall, the bill was approved by a unanimous voice vote of the Subcommittee on Communications and Technology on June 25. The full Committee markup session will begin at 9:30 a.m. Eastern Time in the John D. Dingell Room, 2123 of the Rayburn House Office Building. It can be viewed here.

Per Chairman Frank Pallone’s Committee memorandum, the twelve substantive sections of the bill, including the four new sections approved during the June 25 Subcommittee markup (Sections 9-11 and 13), would provide for the following:

Section 2 of the bill would require the Federal Communications Commission (FCC) to complete a rulemaking within six months of enactment and, as appropriate thereafter, to ensure the effectiveness of consumer protection and privacy provisions that are contained in Section 227 of the Communications Act. Specifically, the FCC would be required to prescribe rules and revise its existing rules under the Telephone Consumer Protection Act (TCPA) to protect consumers and their privacy, ensure that robocalls are only made with consent, ensure that consumers can withdraw consent, prevent circumvention or evasion of the law, ensure robocallers are keeping records to prove they have the consent of the people they are calling, and help ensure robocallers are following the law.

[article_ad]

Section 3 would require the FCC to implement consumer protections on the FCC’s exempted classes of robocalls. These consumer protections must specifically include limits on the classes of parties that may make such calls, the classes of parties that may be called, and the number of calls allowed under the exemption.

Section 4 would require the FCC to submit a report to Congress regarding the agency’s status in implementing actions discussed within the FCC’s Second Report and Order in the matter of Advanced Methods to Target and Eliminate Unlawful Robocalls, which includes the implementation of a reassigned number database. This section also clarifies that when a consumer gets a new phone number, robocallers cannot keep calling to look for the person who had previously been assigned that phone number.

Section 5 would extend the statute of limitations by up to four years, in some cases, to give the FCC and law enforcement agencies enough time to prosecute illegal robocallers.

Section 6 would require the FCC to submit an annual report to Congress on illegal robocallers detailing its enforcement activities during the preceding calendar year. The report also requires the FCC to provide Congress with proposals for decreasing the number of robocalls through additional legislation.

Section 7 would require all carriers, over time, to implement a new technology to make sure that caller-ID information is appropriately authenticated with no additional line item charge for consumers on their bill. Specifically, this section requires the FCC to recognize and address the burdens and barriers to adopting this technology across the country. Implementation of these measures will help to ensure that rural parts of the country with older technology are not left behind. To the extent some carriers need additional time to implement this technology, the FCC will need to find alternative methodologies for authenticating calls.

Section 8 would ensure that robocall blocking services offered on a default basis are provided with no additional line item charge to consumers on their bills and that consumers and callers have effective transparency and redress options with regard to robocall blocking services.

New section 9, added by an amendment offered by Representatives Donald McEachin (D-VA) and Pete Olson (R-TX), would require the FCC to submit evidence of certain criminal robocall violations to the Department of Justice for criminal prosecution and the FCC to publish a report annually disclosing how frequently the FCC submitted such evidence.

New section 10, added by an amendment offered by Representatives Yvette Clarke (D-NY) and Gus Bilirakis (R-FL), would require the FCC to initiate a proceeding to protect consumers from one-ring scams, including by working with foreign governments to address one-ring scams and by incentivizing carriers to stop calls made to perpetrate one-ring scams, among other things.

New section 11, added by an amendment offered by Representative Darren Soto (D-FL) on behalf of Representative Charlie Crist (D-FL), would require the Attorney General, in consultation with the FCC, to convene an interagency task force to study the enforcement of the TCPA. Among other things, the task force will: (1) determine how federal law and budgetary constraints inhibit enforcement of the TCPA; (2) identify existing and additional policies and programs to increase coordination between federal departments, agencies and the states for enforcing and preventing violations of the TCPA; and (3) identify existing and potential international policies and programs to improve coordination between countries in enforcing the TCPA and similar laws.

New section 13 was added by an amendment offered by Representatives George Butterfield (D-NC), Bill Johnson (R-OH), Darren Soto, and Greg Gianforte (R-MT) and requires the FCC to register a consortium of companies engaged in private-led efforts to traceback the origin of suspected unlawful robocalls. It also creates a certification process for when carriers have or have not participated in a private-led effort to traceback the origin of a suspected unlawful robocall, requires the FCC to publish a report on participation by carriers in private-led efforts to traceback the origin of suspected unlawful robocalls, and allows the FCC to permit some carriers to not accept calls from carriers facilitating suspected unlawful robocalls, among other things.

—

Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

PITTSBURGH, Pa. –Credit Management Company (CMC) held a blood drive at the main office in Greentree on Wednesday, July 3, 2019.  Due to the severe shortage of blood in the Pittsburgh area, CMC scheduled the Red Cross Bus to come onsite to our location. We successfully collected 24 total units, which will help save 72 lives!

“Our donation is just a small part of our annual community relations efforts. The CMC team is passionate about helping others and this was an opportunity to help fill a critical need in our region,” stated Joel McKiernan, VP of Sales. 

About CMC 

CMC is an accounts receivable management company based in Pittsburgh that is committed to providing business partners with optimum accounts receivable management, debt recovery, and customer care programs through industry expertise, call center management, current technology, and superior communication. 

CMC has been supporting clients of all sizes in many industries for over 50 years.

[article_ad]

About The Red Cross

The American Red Cross prevents and alleviates human suffering in the face of emergencies by mobilizing the power of volunteers and the generosity of donors. Through its strong network of volunteers, donors and partners, is always there in times of need.  They aspire to turn compassion into action so that all people affected by disaster across the country and world receive care, shelter and hope; our communities are ready and prepared for disasters; everyone in our country has access to safe, lifesaving blood and blood products; all members of our armed services and their families find support and comfort whenever needed; and in an emergency, there are always trained individuals nearby, ready to use their Red Cross skills to save lives.

As seen often in this industry, there are two sides to every FDCPA litigation coin. When a debt collector starts seeing one type of claim, it is expected that it will also be sued for the exact opposite as well. The current state of FDCPA litigation, the lack of repercussions to consumers and their attorneys for filing hyper-technical claims (which, according to some judges in New York, actually harm consumers), and the inability of debt collectors to recover their defense fees even if they prevail have all led to a “damned if you do, damned if you don’t” situation for debt collectors.

[article_ad]

One example of this is the meaningful attorney involvement claim that is frequently filed against collection law firms. Cases revolving around meaningful attorney involvement in collection lawsuits have become frequent lately. So, naturally, collection firms also see claims that they allegedly misrepresent that attorneys were involved in the matter. [Editor’s Note: Is your head spinning yet? Mine sure is.]

Fortunately, these firms seem to be prevailing on these claims in court. For example, Weltman Weinberg & Reis prevailed against the Consumer Financial Protection Bureau (CFPB) in a case where the judge found that attorneys were meaningfully involved in the firm’s collection litigation practices. An example of a collection law firm prevailing against the other-side-of-the-coin argument is a decision released yesterday out of the Eastern District of Wisconsin.

In Bencomo v. Forster & Garbus LLP, et al., No. 18-cv-1259 (E.D. Wis. July 15, 2019), the court dismissed a case where the collection firm was accused of misrepresenting attorney involvement in its collection letter. The letter contained:

• The firm’s name in the letterhead, including that it is a New York law firm.
• Wording that the account was placed with the firm for collection.
• A disclosure stating, “At this time we are only acting as a debt collector. Attorneys may act as debt collectors. Our firm will not commence a suit against you. However, if we are not able to resolve this account with you, our client may consider additional remedies to recover the balance due. . . . Please note that we are required, under federal law to advise you that we are debt collectors and any information we obtain will be used in attempting to collect this debt.”

Plaintiff alleged that the letter could mislead a least sophisticated consumer into thinking that an attorney exercised professional judgment to determine whether the account was delinquent and whether it was suitable for legal action.

The court unequivocally disagreed, finding that the letter contained sufficient disclosures to disclaim attorney involvement. The disclosure explicitly states that the firm was only acting as a debt collector at the time and that it will not commence a lawsuit against plaintiff. Plaintiff’s argument that consumers somehow think that the terms law firm and attorney are distinct fell on deaf ears. The court found reading the letter the way plaintiff suggests—that even if the law firm states it won’t sue, it doesn’t mean that the attorneys within the law firm won’t sue either—is idiosyncratic and frivolous.

In addition to its finding on the attorney involvement issue, the court also dismissed several other claims. Specifically:

• The claim that the letter threatened litigation, finding that there was an express disclaimer that the firm would not sue. The court was not swayed by plaintiff’s argument that the disclaimer could be interpreted to mean the firm would seek local counsel to sue, mainly because there was no reference to local counsel in the letter.
• The claim that the due date of the minimum payment, which fell within the validation window, overshadows plaintiff’s validation rights. Once again, the court found that the letter included a sufficient disclaimer to prevent any misunderstanding by stating that “Your right to dispute the validity of this debt or any portion thereof, or to seek verification of the debt as stated in the above paragraph, is not affected by the minimum payment due date.”
• The claim that there was confusion about the amount due under the letter due to it listing both the account balance and the minimum amount due. The court found the amounts to be consistent with plaintiff’s account statements and that the plaintiff’s “confusion is strained and disingenuous.”

Ultimately, the court granted defendant’s motion to dismiss and denied plaintiff’s motion for leave to amend the complaint.

insideARM Perspective

One of the frustrating things about this case is the end: the dismissal of all non-attorney involvement claims. Don’t get me wrong, it’s good news that the court dismissed them—but why did these claims need to be defended in the first place? The policy behind the FDCPA allowing plaintiffs to bring claims without fear of how they will cover their legal fees is sound, but the way it’s been put into practice is not. It’s led to cases such as the above, which throw good faith in filing claims out the window. Instead, plaintiffs seem encouraged to throw anything and everything on the wall, including the kitchen sink, to see if it sticks. Does arguing whether an explicit statement that the law firm will not sue the consumer really means that the law firm will not sue the consumer provide any benefit? Does “kitchen sink” litigation further the policy of the FDCPA and help protect consumers? I think we all know the answer to that question.

—

Want to conduct incisive research as shown above in a quick click of a button? Save yourself hours of researching and reading cases by subscribing to iA’s new Case Law Tracker.