Archives for March 2023

Incorporating a new AI-powered technology can cause apprehension, and understandably so. Unanswered questions about deployment challenges, efficacy, and compliance can be discouraging for collection agencies. But over the years, Voice AI has become easy to deploy, requiring no tech personnel from collection agencies, and can be deployed within a day or a week. With the economic downturn unfolding and intensifying industry consolidation, there is a need for urgent action; now is the time for collection agencies to embrace this cutting-edge technology.

The ARM industry has adopted technology as it evolved; Auto-dialers, IVRs, CRMs, and ERPs, which have solved numerous bottlenecks. But the core challenges remain persistent and debilitating:

• Low account penetration

• Meeting compliance requirements

• Agent attrition and availability

• Cost of collections

None of the present technologies can solve these problems simultaneously, except for Conversational Voice AI. The question then arises–why and how–does conversational Voice AI possess the capabilities to transform collections fundamentally?

• Infinitely Scalable Consumer Conversations: Voice AI solution opens new doors of opportunity for collection companies to connect with the consumer in intelligent, personalized conversations. This means 100% account penetration in a matter of minutes.

• Debt Portfolio Segmentation: Instantly gaining visibility into your entire portfolio with data-supported insights:

  • RPCs and WPCs

  • Consumer dispositions or propensity to pay

  • Disputed debt

  • Attorney representation

  Agents can thus enhance the efficiency of the collection procedure and use their time more efficiently by focusing on customers with a high probability of payment.

• Augmenting Agents: A live collector is only assigned to handle complex calls or requests made by the customer. As a result, a significant number of calls are dealt with by the Voice AI platform, which generates considerable benefits and enables the live collector to concentrate on more critical tasks. Escalated calls are accompanied by conversation summaries, allowing the collector to pick up where they left off. Also, the Voice AI solution has consistent outreach, connecting the right person at the right time and reducing the low-value workload of the agent significantly.

• Cost of Collections: Scalable consumer conversations at a fraction of cost allow the collection agencies to process a significant fraction of their portfolio hitherto left unprocessed because of cost and agent bandwidth constraints.

Is Conversational AI for Everyone?

This technology is suitable for any agency, regardless of its size. Here are some parameters to understand the nature of this technology:

• Ease-of-use: The solution can be managed without involving any team members from the agency, as it is user-friendly and does not require coding.

• Integrations Capabilities: The solution’s versatility allows for easy integration of multiple third-party systems, including payment gateways used by collection agencies, CRMs, and other operational systems, without disrupting normal organizational operations.

• Compliance: The technology helps collection companies improve compliance with Reg F. and all other regulations, primarily because the Voice AI does not deviate from the scripts and provides accurate information to the consumers, minimizing, thus, the probability of litigation. Also, updating the solution for any changes in the regulations is effortless, thus further preventing any possibility of litigation.

Accelerate Recovery with Conversational Voice AI

Several pioneers are reimagining their businesses using Voice AI as the industry sets off on a wave of transformation.

Collection agencies can handle more debt with the same staff, and their improved agent abilities allow them to increase their collection success rate. Additionally, accessing all accounts in just minutes aids in faster debt collection.

Would you like to explore the future of debt collection with Voice AI? – Speak With Our Conversational Voice AI Expert.

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CINCINNATI, OH — Slovin and Associates, a creditor’s rights law firm in Ohio, Kentucky, and Indiana, has a long history of community involvement. Partners Randy Slovin and Brad Council have spent decades in the community helping those in need. This past November, Mr. Council and his wife took a trip to the Olancho region of Honduras where they helped install solar panels at three different remote schools in just a week. 

“It was the most rewarding experience imaginable,” Mr. Council said. “We stayed in Juticalpa and would drive to these remote villages, usually three to four hours away. These regions typically don’t have power and most schools were small one-room schoolhouses where the children of local coffee farmers attend classes. Providing opportunities for furthering children’s education is important to our family and I couldn’t be more proud of the work we did supporting these communities.” 

A Light for All

Mr. Council and his wife took this trip withSonLight Power, a faith based non-profit that specializes in the installation of solar power in remote areas. SonLight, based in Milford, Ohio, has spent many years connecting solar operations with communities across the globe. With over 85 partnerships established, SonLight has installed 510 kilowatts of solar panels in 19 countries. 

To power the Honduras trip, SonLight partnered with the Thousand Hills Cowboy Church of Ethridge, Tennessee and Iglesia Cristiana Vida Abundante in Honduras. 

During Mr. Council’s trip to Honduras, SonLight remained in close contact with the heads of the Olancho region to determine the schools that would receive solar panels. Mr. Council said that the schools equipped would now have solar panels and batteries that could provide them adequate light for nighttime activities and further schooling. With solar power on hand, schools were also provided with multimedia equipment like TVs and DVD players to further students’ education. Each school, in addition to the solar panels and multimedia equipment, also received many boxes of school supplies to help students in every way possible. 

To see more from Mr. Council’s trip, SonLight created a slideshow video of the mission trip. 

About Slovin & Associates, Co., LPA

Slovin & Associates, Co., LPA aims to achieve the highest rating for creditor’s rights law firms in Ohio, Kentucky, and Indiana by obtaining expeditious and cost-efficient results in a professional and low-maintenance environment for our clients in the fields of collections, commercial and consumer litigation, bankruptcy, leasing and landlord-tenant law, and Fair Debt consulting.

Continuing its (and the White House’s) “junk fees” rhetoric, on March 8, 2023, the CFPB released a new issue of Supervisory Highlights that carries the title “Junk Fees Special Edition.”  The report discusses the Bureau’s examinations involving fees in the areas of deposits, auto servicing, mortgage servicing, payday and small-dollar lending, and student loan servicing that were completed between July 1, 2022 and February 1, 2023.  

The report’s release coincided with a virtual White House event for state legislators on state efforts to address “junk fees.”  According to media reports about the event, White House officials encouraged state lawmakers to take their own actions to address junk fees.  The White House also released a “Guide for States: Cracking Down on Junk Fees to Lower Costs for Consumers” that discusses approaches states have taken to address junk fees through enforcement and legislation.  CFPB Director Chopra, who spoke at the event, is reported to have offered the CFPB as a resource for state junk fees initiatives and indicated that state lawmakers have sought the CFPB’s advice on potential changes to state consumer protection laws.

Key findings by CFPB examiners include:

Deposits

The Bureau cited institutions for unfair acts or practices based on overdraft fees charged on transactions that authorized against a positive balance, but settled against a negative balance (APSN overdraft fees).  Such fees were the subject of a 2022 Circular issued by the Bureau.  APSN overdraft fees can occur when a bank assesses overdraft fees for debit card or ATM transactions where the consumer had a sufficient available balance at the time the bank authorized the transaction, but the account is insufficient at the time of settlement.  Examiners found instances in which unfair APSN overdraft fees were charged using a consumer’s available balance for fee decisioning, as well as when the consumer’s ledger balance was used.  According to the CFPB, consumers could not reasonably avoid the injury irrespective of account-opening disclosures.  The institutions were directed to stop charging APSN overdraft fees and to issue remediation to consumers who were charged such fees.  

The Bureau also issued matters requiring attention to correct problems that occurred when institutions had enacted policies intended to eliminate APSN overdraft fees  but such fees were still charged.  This occurred where institutions attempted to prevent APSN overdraft fees by not assessing overdraft fees on transactions that authorized positive, as long as the initial authorization was still in effect at or shortly before settlement. Some transactions, however, settled outside of this time period.  Examiners found inadequate compliance management systems where institutions failed to maintain records of transactions sufficient to ensure overdraft fees would not be assessed, or failed to use another solution not to charge APSN overdraft fees.

With regard to non-sufficient (NSF) fees, examiners found institutions had engaged in unfair acts or practices based on the assessment of multiple NSF fees when the same transaction was presented multiple times for payment against an insufficient balance in the consumer’s account.  The institutions agreed to cease charging NSF fees for unpaid transactions entirely and were directed to make refunds to consumers.  The Bureau reported that”[v]irtually all institutions that Supervision has engaged with on this issue reported plans to stop charging NSF fees altogether.”

Auto servicing  

Examiners found that servicers engaged in unfair acts or practices by:

• Assessing late fees in excess of the amounts allowed by consumers’ contracts.

• Assessing late fees not allowed by consumers’ contracts where, as a result of acceleration of the loan balance, the consumers’ contractual obligation to make further periodic payments was eliminated and the servicers’’ contractual right to charge late fees on such periodic payments was also eliminated.  Servicers had continued to collect late fees even after repossession of the vehicle on periodic payments scheduled to occur after the date of acceleration.

• Charging estimated repossession fees that were significantly higher than the costs they purported to cover, even where the servicers returned the excess amount to the consumers after they received the invoice for the actual costs.

Examiners also found that auto servicers engaged in unfair and abusive acts or practices by charging payment processing fees that “far exceeded” the servicers’ costs for processing payments.  Servicers only offered two free payment options-preauthorized recurring ACH and mailed checks-which were only available to consumers with bank accounts.  Approximately 90 percent of payments made by consumers incurred a pay-to-pay fee, with servicers receiving over half the amount of the fees from the servicers’ third-party payment processor.

Mortgage servicing  

Examiners found that servicers engaged in unfair acts or practices by:

• Assessing late fees in amounts in excess of the amounts allowed by the borrowers’ loan agreements.  This was the result of the servicers’ failure to input late fee caps into their systems where the borrowers’ loan agreements included a maximum permitted late fee.  Servicers were also found to have violated Regulation Z by including inaccurate late fee payment amounts in periodic statements (since the amounts exceeded the late fees permitted by the loan agreements).

• Charging consumers for repeat property inspection visits to known bad addresses.

• Failing to waive certain late charges, fees, and penalties accrued outside of CARES Act forbearance periods where required by HUD for a consumer entering into a permanent COVID-19 loss mitigation option.

Examiners found that servicers engaged in deceptive acts or practices by:

• Sending periodic statements and escrow statements that included monthly private mortgage insurance (PMI) premiums that consumers did not owe.  These consumers’ loan had lender-paid PMI which should not be billed directly to consumers.  

• Sending periodic statements to consumers in their last month of forbearance that incorrectly listed a $0 late fee amount for the subsequent payment, when a late fee was in fact charged if the subsequent payment was late.

Examiners found that servicers violated the Homeowners Protection Act by failing to terminate PMI on the date the principal balance of the mortgage was first scheduled to reach 78 percent loan-to-value on a mortgage loan that was current.

Payday and small-dollar lending 

Examiners found that lenders in connection with payday, installment, title, and line-of-credit loans engaged in unfair acts or practices by:

• After unsuccessful debit attempts, without consumers’ authorization, splitting missed payments into as many as four sub-payments and simultaneously or near-simultaneously representing to consumers’ banks for payment by debit card.

• Charging borrowers unexpected fees to retrieve personal property from repossessed vehicles and to cover servicer charges, and withholding the personal property and vehicles until the fees were paid.

• Failing to stop vehicle repossessions before title loan payments were due as-agreed, and then withholding the vehicles until consumers paid repossession-related fees and refinanced their debts.

Student loan servicing  

Examiners found that servicers engaged in unfair acts or practices by initially processing credit card payments that were subsequently reversed, leading to additional late fees and interest.  Where servicers’ policies did not allow payments to be made using a credit card, customer service representative had erroneously accepted and processed credit card payments.  These payments were subsequently reversed, causing consumers to become delinquent on their accounts.  Servicers did not consistently send notices explaining the reversals or give consumers an opportunity to use another method for making the payments before reversing the credit card payments.

The CFPB’s press release describes the “Junk Fees Special Edition” as a report “on unlawful junk fees.”  However, it appears that all of the violations cited by CFPB examiners that are  discussed in the report did not involve fees that the supervised entity could not lawfully charge.  Rather, there were various errors in how or when the fees were assessed that caused them to be “unlawful.”  The CFPB’s use of the loaded term “junk fees” to describe the fees discussed in this issue of Supervisory Highlights appears intended to further a political agenda rather than further what the CFPB has always described the goal of Supervisory Highlights to be–namely assisting supervised entities in complying with federal consumer financial law.  In recent remarks to the Consumer Law Scholars Conference, CFPB Deputy Director Martinez described credit card late fees as “a fee that has skyrocketed from a small corner of the market to the top of everyone’s most hated junk fee list.”  The CFPB’s continued indiscriminate use of the term “junk fees” to describe what in most cases are heavily regulated, clearly disclosed fees for services used by consumers or that consumers incur as a result of avoidable behaviors serves neither the interests of consumers nor those of industry.  

ELK GROVE, Calif. — Superlative RM, a collection agency located in Elk Grove, CA and Phoenix, AZ, is honored to announce its receipt of the 2022 Tier 1 Top Agency Award from Cascade365 — a family of companies that provide accounts receivable liquidity solutions to the consumer finance and healthcare industries.

“I’m very fortunate to be able to say our team is both dedicated and extremely hard-working. This award is a reflection of that and our core values: Create a WOW factor with everyone we contact; Do it right from A to Z; Collaborate at every opportunity,” said Superlative RM Founder and President, Jerry Terrill. “We’re incredibly thankful for strong partnerships with clients such as Cascade, and we look forward to continuing to do excellent work with them.” 

The Cascade award is a recognition of superior performance, adherence to compliance standards, and exemplary back-office support. Cascade Receivables Management, LLC — a subsidiary of Cascade365 — provides master servicing solutions for creditors and works with a network of vendors to achieve asset liquidity. Like Superlative RM, the company is headquartered in California and is an RMAI-Certified Receivables Business. 

The consistent growth at Superlative RM is reflective of the culture—creating a positive and high-energy atmosphere that sparks a “Wow Factor” for anyone that interacts with the team. Their relationships among the team and with their clients are enhanced through their collaborative work environment. As effective communication is the key to maximizing performance, it is the standard they set for themselves in everything they do. They call this “The Superlative Way.”

About Cascade365

Cascade365 is a family of companies that provide accounts receivable liquidity solutions to the consumer finance and healthcare industries. Cascade365’s suite of products and services include AR purchase and finance, master servicing and third party collections, and revenue cycle optimization. The Cascade365 Family of Companies believes in promoting financial accountability while treating consumers and patients in a fair, dignified, and lawful manner.

About Superlative RM

Superlative RM (SRM) is an accounts receivable management company that assists our clients by contacting consumers to resolve outstanding account balances. We are nationally licensed and work diligently to follow all current state and federal guidelines. We bridge the gap between creditors and consumers by innovating user-friendly, digital account resolution options.

During this week’s RA Peer Call, a member asked about the new Visa rule that implements Merchant Category Code (MCC) for debt collection and what it means for debt collectors. 

As a result of this question, Sara spent Monday evening researching and speaking to several payment processors to gain additional clarity, and Missy spent Friday morning reading and rereading Visa rules. It is confusing, but here’s what we’ve come to (Missy is insisting we include a disclaimer here that nothing in this newsletter should be considered legal advice, and you should always consult your own counsel).  

Background on MCCs 

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When you accept credit card payments, your payment processor assigns an MCC to your account. Until now, American Express was the only merchant that assigned a specific MCC to debt collection (find the Amex list here). When American Express added MCC 7322 for debt collection as a “restricted industry” the industry responded universally by dropping it as a payment option altogether. Until now, Visa likely assigned a similar but not specific MCC for payments processed via a credit card. 

The Current Rule

Visa’s current rules apply to “debt” which includes credit cards, money advanced for goods and services, and repayments that include interest (see page 845). Section 5.8.12 (page 459) of the current rules prohibit an acquirer (bank or processor) from allowing a merchant to use a credit or charge card for repayment of a “debt.”

What is Visa Changing? 

Visa announced in October 2022 that they were introducing a new MCC and rules for collection agencies. Visa has defined a collection agency as a merchant that collects payments of overdue receivables under contract or that collects overdue receivables that they have purchased from a third party. 

You can find a copy of the Visa Bulletin provided to Acquirers, Issuers, Processors, and Agents here. 

Overdue Receivable Definition

Visa has defined an overdue receivable as money owed by one party (debtor) to another (creditor) that is not classified as a debt and is one of the following:

• Classified by the receivable owner as non-collectable
• Written off and/or sold to a third party
• Subject to a court order as the result of a bankruptcy or insolvency
• 120 calendar days past the due date for payment

Based on the above criteria, in addition to third-party debt collection activities, overdue receivables may include any first-party or early-out accounts that are 120 calendar days past the due date for payment. 

The Rules and the Debit/Credit Split

Visa’s Bulletin included both “New Collection Agency Rules” and “Overdue Receivables Rules.” At first glance, these rules seem to be in direct conflict with each other, which is causing confusion across the industry. 

The Collection Agency Rules provide disclosures that must be read to the consumer, “before the transaction occurs.” However, the Overdue Receivable Rules say that an acquirer (bank or processor), must ensure that a merchant accepting an overdue receivable transaction, “Does not use a credit or charge card.”

Huh? How can Visa allow transactions and require disclosures at the transaction stage, but simultaneously seem to prohibit the use of Visa charge cards to pay an overdue receivable?

Though worded ineloquently, the difference may hinge on whether the payment is made with a Visa debit or Visa credit card. 

Taken at face value, the bulletin indicates that effective April 15, 2023, those collecting first or third-party accounts that meet the definition of overdue receivables will be prohibited from accepting Visa credit cards. Debt collectors can accept a Visa debit card if they provide the following disclosures before the transaction occurs: 

• Name of the original lender or creditor 
• Information to identify the transaction such as:  

           – Account/reference number from the original lender or creditor

           – Description of the debt or receivables 

           – Date of the repayment contract 

• Instructions for the cardholder on how to obtain additional information about the underlying transaction

Additional Clarity Needed 

Visa needs to clarify several points before debt collectors can comply with Visa’s new MCC and rules. First, Visa needs to explain the above issue. As worded, it is extremely confusing to everyone who has read it. Additionally, Visa should clarify:

1. What does the “Date of the repayment contract” mean? 
2. Do the “Instructions for the cardholder on how to obtain additional information about the underlying transaction” mean that debt collectors are required to pull debt validation documents long after an account is paid off?  
3. Do these new rules impact current payment plans which were set up using a Visa credit card? 
4. Do these rules require collection agencies to submit payments to MCC 7322 and abandon the current MCCs being used?

Impact to Collection Agencies

One school of thought is that since Visa already had rules applying to “debt” this new rule changes very little. Others disagree and contend the update creates a new mandatory prohibition on accepting credit cards. 

Some collection agencies might proceed business as usual since there were already rules surrounding debt, and others might decide to stop accepting Visa as a payment option to avoid any issues. Some might even stop accepting credit cards moving forward. After all, it is the most expensive payment option. As always, your team should connect to determine your risk and risk tolerance. 

Visa is expected to publish additional information regarding this change before the end of the month, so be sure to watch for information from your payment processor. If those updates do not clarify this bulletin or your payment processor has not reached out to discuss the Bulletin and its impact on your payments, you should reach out directly to them. If Visa aggressively stops credit card payments from going through on April 15, 2023, you’re going to want to know how that impacts your future dated payments. 

Research Assistant members can rest assured that we are watching this closely and will alert our members of any additional clarity received from Visa prior to the effective date. 

—

Don’t manage compliance on an island. Access peers and industry experts for insight and feedback while working through difficult compliance projects as a Research Assistant member. Learn more.

In addition to a library of compliance tools and resources, Research Assistant members have the opportunity to meet weekly to discuss their pressing compliance issues. The unique feedback and insight -that can only come from peers – helps our members find answers quickly without the need for additional staff. Recaps of our meetings are kept in a members-only portal, ensuring Research Assistant members can always find what they need.  For more info about Research Assistant or to sign up for a one-month free trial, click here.

On March 3, the CFPB received a rulemaking petition from the National Consumer Law Center (NCLC) in response to forthcoming FCRA rulemaking announced in the Bureau’s Fall 2022 regulatory agenda. As previously covered by InfoBytes, the Bureau announced it is considering pre-rulemaking activity in November to amend Regulation V, which implements the FCRA. In January, the Bureau issued its annual report covering information gathered by the Bureau regarding certain consumer complaints on the three largest nationwide consumer reporting agencies (CRAs). At the time, CFPB Director Rohit Chopra said that the Bureau “will be exploring new rules to ensure that [the CRAs] are following the law, rather than cutting corners to fuel their profit model.” (Covered by InfoBytes here.)

The NCLC presented several issues for consideration in the FCRA rulemaking process, including that the Bureau should (i) “establish strict requirements to regulate the furnishing of information regarding a debt in collections by third-party debt collectors and debt buyers”; (ii) “require translation of consumer reports by the [CRAs] into the eight languages most frequently used by limited English proficient consumers”; and (iii) “establish an Office of Ombudsperson to assist consumers who have been unable to fix errors in their consumer reports from the nationwide CRAs and other CRAs within the CFPB’s supervisory authority.”

“Given the level of errors, problems, and abuses by debt collectors in furnishing and resolving disputes, requiring an original creditor tradeline is a reasonable quality control mechanism,” the NCLC said. “Alternatively, if the CFPB continues to permit the furnishing of debt collection information without a pre-existing tradeline by the original creditor, the Bureau should require that the furnisher of debt collection activity (whether a debt collector, debt buyer, servicer or other) provide a complete account history in the tradeline, including positive payments,” the petition added, stressing that “such reporting must require adequate substantiation[.]”

SACRAMENTO, Calif. — RMAI introduces a new guide for the accounts receivables management industry, Implementing Diversity Equity Inclusion Best Practices: RMAI Diversity Equity Inclusion Program Baseline Recommendations. This companion guide to the January 2022 Consumer Financial Protection Bureau (CFPB) Report on Diversity and Inclusion within Financial Services identifies the foundational areas of a Diversity Equity Inclusion (DEI) program, as well as steps RMAI member companies can take to establish and mature their DEI initiatives.

This guide is designed for companies that are building their DEI efforts, as well as those that are refining their well-established DEI programs. The RMAI DEI Task Force prepared this resource to help RMAI member companies implement the CFPB’s best practices and recommendations for organizations based on size. The guide is organized into action items within the following four areas identified in the CFPB Report:

1. Organizational Commitment to Diversity and Inclusion
2. Workforce Profile & Employment Practice
3. Supplier Diversity
4. Practices to Promote Transparency of Organizational Diversity and Inclusion

“DEI is a topic of growing awareness for our members and the larger credit ecosystem,” said RMAI Executive Director Jan Stieger. “This guide is one of several resources providing education to our members in this area. RMAI also offers a DEI Scholarship for our Annual Conference, and DEI education at our events and in our publications. This new guide provides members support for their own DEI programs.”

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The RMAI Board of Directors initiated the Diversity & Inclusion Task Force in 2019 after recognizing the development of D&I initiatives by the Fortune 500 companies. In February 2023, the RMAI Board of Directors reclassified the Task Force as the current Diversity Equity Inclusion Committee. The Committee’s mission is to empower RMAI member companies to create an inclusive culture by delivering rich content and experiences on diversity and inclusion practices that will allow their businesses to thrive.

Find out more and download Implementing Diversity Equity Inclusion Best Practices: RMAI Diversity Equity Inclusion Program Baseline Recommendations.

About RMAI

Receivables Management Association International (RMAI) is a nonprofit trade association representing more than 600 companies that purchase or support the purchase of performing and nonperforming receivables on the secondary market. The RMAI Receivables Management Certification Program is celebrating its 10th anniversary in 2023. Together with RMAI’s Code of Ethics, the Certification Program sets the global standard within the receivables industry due to the rigorous uniform standards of best practice which focus on protecting consumers. More information about RMAI is available at www.rmaintl.org.

On March 9, the U.S. House Financial Institutions and Monetary Policy Subcommittee held a hearing entitled “Consumer Financial Protection Bureau [CFPB]: Ripe for Reform.” The memorandum released in advance stated the hearing would “examine the leadership structure, funding, budget, and operations of the CFPB and areas in which reforms are needed.” Predictably, during the hearings there was a partisan split on the proposed reforms, with Republican members attacking what they characterized as agency overreach in areas such as fee elimination and advocating drastic reforms up to total defunding, while Democratic members of the subcommittee largely supported the agency’s actions.

In his opening statement, Chairman Andy Barr (R) explained why, in his opinion, reforms were needed and introduced a bill to do just that:

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“[T]he CFPB operates outside of the congressional appropriations process, receiving its funding through the Federal Reserve (Fed), which also operates outside of the appropriations process, through an opaque formula. This denies Congress the use of its most powerful oversight tool — the ‘power of the purse.’ My bill, the Taking Account of Bureaucrats Spending Act, or the TABS Act, gives Congress back the power of the purse and its oversight power, reins in the unaccountable CFPB, and subjects the agency to the traditional appropriations process.”

Beyond the TABS Act, other reform bills discussed during the hearing included:

The CFPB Dual Mandate and Economic Analysis Act. This bill would establish the Office of Economic Analysis in the CFPB to review all proposed and existing rules and regulations. Additionally, the purpose of the CFPB would be revised to include strengthening private sector participation in markets, without government interference or subsidies, to increase competition and enhance consumer choice.

The CFPB–IG Reform Act. This bill would establish a separate Office of Inspector General for the CFPB.

The Consumer Financial Protection Commission Act. This bill would remove the CFPB from being funded by the Fed, convert the CFPB into an independent commission, eliminate the positions of director and deputy director, and establish a five-person commission appointed by the President and confirmed by the Senate.

Federal Reserve Loss Transparency Act. This bill would amend the Consumer Financial Protection Act of 2010 to prohibit the Fed from transferring money to fund the CFPB if the Federal Reserve Banks incur an operating loss, and amend the Federal Reserve Act to require the Fed to follow US GAAP.

Beyond reforming the structure and funding of the agency, the CFPB’s war on fees, most recently discussed here, was a hotly contested topic. Subcommittee member Blaine Luetkemeyer (R) accused Director Chopra of using so-called “junk fees” as an excuse to expand his authority. “[T]he fact that we now call them junk fees doesn’t mean it’s real.” Maxine Waters (D), ranking member of the House Financial Services Committee, defended the agency’s actions in the area stating, “[t]he CFPB has made major progress in supporting consumers, combatting discrimination and junk fees, holding large financial institutions accountable for repeatedly harming consumers, and so much more.”

The proposed reform bills have virtually no chance of becoming law with Democrats currently in control of the Senate and the White House. We see the introduction of these bills as markers for future activity by the Republicans when the political conditions are more conducive. Although ordinarily that would need to await the Republicans taking control of the White House and both Chambers of Congress, if the Supreme Court holds that the CFPB should be subject to Congressional appropriations in the CFSA case, most recently discussed here, the Democrats will need the Republicans’ cooperation in order to fund the agency’s ongoing operations. The Republicans appear to be setting forth the conditions of that cooperation through the proposed legislation discussed at this hearing.

A recording of the Subcommittee hearing is available here.

ROCHESTER, N.Y. — Continental Service Group, LLC, d/b/a ConServe, in conjunction with the company’s “Matching Gift Program”, donated its January and February ConServe Cares proceeds to the Perinton Ambulance and the Bellevue Fire Department.  The ConServe team supports and funds the efforts of numerous local non-profit agencies that strive to make a difference.  As a result of the employees’ compassion and generosity; countless lives have been touched and enriched in our community.

Mike Hoskins, Chief of Perinton Ambulance states, “Perinton Ambulance appreciates and depends on philanthropic support from businesses, groups, and organizations to help us treat more than 4,500 patients annually.  In addition to our 911 responses, this support ensures we can offer child seat safety inspections, blood pressure clinics, CPR & First Aid training, and much, much more for our community.  The generous support from those working at ConServe help keep us Always There and Ever Prepared.”

“ConServe is committed to giving back to our local communities and is an integral part of our mission statement,” said George Huyler, Vice President of Human Resources.  “We’re proud to support the first-responders who have committed to being there for our families, our neighbors, and our communities whenever we need them.”

About ConServe

ConServe is a top-performing accounts receivable management service provider specializing in customized recovery solutions for their Clients.  Anchored in ethics and compliance, and steadfast in their pursuit of excellence, they are a consumer-centric organization that operates as an extension of their Clients’ valued brands.  For over 37 years, they have partnered with their Clients to provide unmatched customer service while simultaneously helping them achieve their accounts receivable management goals.  Visit them online at: www.conserve-arm.com

About the Perinton Ambulance

Perinton Ambulance is a registered 501(c)3 not-for-profit ambulance service located in Fairport, NY. Perinton Ambulance has been providing Emergency Medical Services (EMS) since 1965 with a commitment to caring for the local community. Perinton Ambulance provides Basic and Advanced Life Support emergency care with a team of over 60 professional and certified Emergency Medical Technicians and Paramedics.  Visit them online:  www.perintonambulance.org

About Bellevue Volunteer Fire Company

The Bellevue Fire Company provides fire protection and EMS services to the residents and visitors of the Bellevue Fire District.  Our District is roughly the area of Cheektowaga between Union Road and Transit Road and between Como Park Blvd and Losson Road. Bellevue answers approximately 550 calls a year.  Visit them online:  https://www.bellevuefire.org/

So its Selection Sunday again. Amazing how fast time flies.

TONS has changed since the last time I did this power ranking–just one year ago. At that time I was still an equity partner in #biglaw–having not yet mustered the courage to start my own shop. And the traffic on TCPAWorld.com was much lower– the power rankings became my best read article ever at that time, but this year has already seen 5 stories with more reads.

The site–always popular– has really blown up since I’ve been out on my own and its amazing to see.

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Some things never change though. The Big 10 is one again overrated and has way too many teams in the field–how does the media seem to have amnesia on this issue year after year?–and the Pac 12 is, once again, woefully underrepresented. But, as I said last year, it all ends up the way its supposed to. And so it will again.

But, for now, it is power ranking time. I have spent several weeks thinking this year’s rankings through.

How does one define power in this context? For instance, if you asked me what Plaintiff’s firm would I least want to face in a TCPA class action the answer would be Edelson PC. But those guys don’t really bring any TCPA cases these days. So can I really call them the most powerful shop in the TCPAWorld?

Then there’s a guy like Avi Kaufman. To say that he is more fearsome than Lief Cabraser or Kazerouni and Associates is absolutely laughable. But then when you look at the incredible (incredible) success he has had over the last 365 days who do I not rank him near the top?

Really tricky stuff.

So ultimately I arrived at the following formula

(2YE * (4N + 10A))/D + (1/10TR)/(1/AR)= Power Ranking 

Where:

YE = years of TCPA experience,

N = the monthly number of TCPA cases filed,

A=  the number of attorneys in the shop,

D= the number of days since the latest TCPA filing,

TR= total recovery for the year

AR= average recovery for the year.

As you can see, computing these metrics for each firm on the list yields a perfectly objective measure of their power.

But of course I didn’t do any of that, because that would be crazy.

What I really did is the same thing I did last year–tried to provide a useful and weighted ranking of what firms really know what they’re doing and have the wherewithal and desire to really push matters in the TCPAWorld.

In short, a list of the most dangerous Plaintiff’s lawyers out there.

And you REALLY need to be paying attention right now. TCPA FILINGS ARE EXPLODING. They are WAY WAY up this year and the STATE LAW filings ad an entire additional dimension.

This is unsurprising as the money here is simply insane. One guy on the list made over $20MM over the last 365 days so… yeah.

So for all of you folks fielding new TCPA suits and wondering if the guys on the other side are any good here is the Czar’s official opinion. Obviously I’ve tangled with everyone on this list multiple times–in many cases dozens of times.

One thing EVERYONE on this list has in common– they are legitimate threats to go “all the way.” That means they will push you to certification, or beyond–and have done so many times.

Without further adieu:

Honorable Mention: Dr. Evil and the guys at LawHQ

So there’s this guy who thinks he can scale the practice of law and bring in “millions” of clients to file TCPA suits.

I’m serious. I call him Dr. Evil.

He has built an App that allows consumers to “swipe right” on robocalls and immediately notify his office of a scam or spam report. This allows the firm’s investigate team to start the process of finding out who is making the calls and then sue them.

When he wins he splits the money “fifty fifty” with the consumer.

It’s nuts. But just nuts enough to work. And it seems to be.

LawHQ is the hottest thing on the rise in TCPAWorld right now and a real rocket ship poised to break into the rankings next year and really upset a few folks.

If you missed our podcast interview with these guys you owe it to yourself to check it out, here.

10. Keith Keogh, Keogh Law, LTD

Dropping to the ten hole on the Czar’s “what have you done for me lately” power rankings, is a guy who would have been near the top just a few years ago.

The “Iceman” of TCPAWorld, Keith has always been cool as a cucumber–or cooler.  And he never blinks when it comes to driving a huge price tag in a TCPA class action. He still owns the single most valuable TCPA settlement in history when judged on a per-class member metric. The Hageman class settlement saw a stunning resolution worth over $1,600 per class member.

As I explained last year, however, Keith has largely taken a back set to others these days–you only need so many Rolls Royces I guess– so his shop just isn’t the TCPAWorld powerhouse it once was. Still, the folks working at Keogh’s shop are still very talented and driven lawyers–and they’re not afraid to ride some lines and push new arguments all the way. Do not take a filing by Keogh lightly.

9. Andrew Shamis/Manny Hiraldo/ Scott Edelsberg

So coming in at number 9 is actually 3 different law firms that tend to work together all the time.

All three of these guys are decent fellas, even if their cases are not always the most meritorious (sorry.) They are true volume players so they seem to be willing to pan for gold in a manner that those higher up on the list simply find intolerable.

Still these guys have gotten a lot better over the years–not intended as a slight, just a fact–and they are FAR tougher to contend with these days than just a few years ago. If you see one of these folks on a filing and your current lawyer calls them a “bottom feeder”–or the like–I think they (and you) need to update the playbook. These guys have certainly earned the Czar’s attention–and respect– and should NOT be taken lightly.

8. Alex Burke, Burke Law Offices, LLC

Burke is up one spot from last year, but continues to lurk on the periphery of the rankings, but he is definitely a threat to rocket to the top.

Burke–known affectionally as “Red” for his amber hair- has been the behind-the-scenes mastermind of numerous multi-million dollar TCPA settlements. He is handling a few lower volume of cases than others on the list, but he is simply explosive–both in terms of his capabilities and his personality–so he simply cannot be left off a TCPA power rankings list.

Burke knows the TCPA and the art of litigation extremely well. And he is not afraid to fight–and fight hard–when pushed. Indeed, pound for pound Burke might be the hardest puncher on this list. Luckily he mostly stays out of the ring these days.

7. Bursor and Fisher, PA

Taking the biggest tumble on this year’s list is Bursor.

Last year they enjoyed a likely-inflated ranking due to a massive crush job that saw the firm deliver the largest TCPA settlement of all time.

Since then, however, these guys have been focused on paying bonuses that make #biglaw blush but haven’t really delivered anything big over the last 365 days.

That said, these guys are MONSTERS, so do be on the look out for them. Remember, they once even got a major defense firm to switch sides and help them. 

While I am very comfortable slotting them in at number 7 this year, I suspect they’ll be higher next time this ranking comes out.

6. Daniel Hutchinson/John Selbin Lieff Cabraser

Down one spot to number 6 this year are a couple of OG litigators. These two have always been more stubborn than clever in my view, but a willingness to litigate hard for many years will almost always lead to great results, and this duo of LC litigators has demonstrated that time and again.

TCPAWorld is still smarting from their wins-that-shouldn’t-be such as Cordoba and Brown. But like Bursor these guys have (mercifully) been a bit quiet over the least year or so.

Its unlikely you would take a class action from LC lightly anyway, but take it from me–these folks are TOUGH litigators that STICK in cases for the long haul and have definitely earned their reputation.

5. Jay Edelson, Edelson PC

Here he is. The boogey man.

Probably the most brilliant plaintiff’s-side litigator on this (or any) list, Edelson PC owns the largest privacy jury verdict in history with their trouncing of Visalus.

But the guy is too busy breaking Tom Girardi into a thousand tiny little pieces to pursue TCPA cases these days. Plus he is trying to put an end to robolawyer virtuoso DoNotPay for some reasons I don’t fully understand, but still totally applaud.

Back when I had a twitter account–can’t believe anyone is still on that platform with Elon running it–I used to love reading this guy’s tweets. He is always on the cutting edge.

Edelson is a rare sighting in TCPAWorld these days but if you ever see Edelson PC on the caption of a complaint naming your business, my goodness you better take it seriously.

4. Abbas Kazerounain, Kazerouni Law Group

The “Godfather” of TCPA class actions and one of the original architects of the entire concept of mass TCPA suits, Abbas is an absolute TCPAWorld legend. And the fact that he’s a pretty good guy just makes it all that much harder to stomach his endless success.

While he is best known as the guy who brought the world the stunning Marks appellate victory Abbas is known in TCPAWorld circles as the guy who has cracked more companies for multi-million dollar settlements than any other living person.

Abbas has grown tired of buying fancy cars and airplanes and has moved on to operating ADR centers. So like others on this list he is less concerned with TCPA class actions than he used to be. Nonetheless, any time KLG shows up on a caption you better be ready to rumble.

Nobody is better funded than Abbas. And although he sometimes plays coy, he is an absolute monster of a litigator.

3. Anthony Paronich, Paronich Law PC

The “Wolf of TCPAWorld” has had a great year. He’s made millions and really done well in the courtroom. As a result he has moved his way steadily up this list.

Paronich has a well-earned reputation as a ruthless litigator and a shrewd negotiator. He somehow manages a large volume of cases with a relatively limited infrastructure while remaining a threat to “go all the way.”

Paronich has been the absolute scourge of the lead generation industry, filing case after case against callers who had the misfortune of buying a lead listing his client. Does Paronich just get lucky in identifying fraudulent lead suppliers, or are his clients setting up these suits?

Tough to say. But Paronich was a VERY compelling first guest on the new Deserve to Win podcast–and if you haven’t listened to what he has to say. YOU SHOULD. 

Any way you look at it, however, when the Wolf comes stalking, don’t open the door.

2. Avi Kaufman, Kaufman, PA

Oh Avi.

I really hate listing this guy so high on the list.

But his firm is responsible for OVER $20MM in fee recoveries over the last year– higher than anybody else on the list. So how can I overlook that?

He has absolutely destroyed the real estate brokerage industry–extracting a massive $40MM settlement from Keller Williams, and he is not yet through with Coldwell Banker who he has on the ropes in a CERTIFIED TCPA class action set to try this year. My goodness.

What really scares me though, is that he is still young, hungry, and improving. He reminds me of peak Burke–which I suspect both men will take as an insult. But there is no denying he is well funded, sharp and in charge of his own destiny now in TCPAWorld.

Still he has weaknesses. A lack of associate-level firepower and a tendency to make little mistakes driven by ego or temper.

Will Kaufman take it to the next level and dethrone number 1 next year? Or will his temperamental nature cripple him as his empire crumbles under the weight of success?

We’ll find out.

As I said last year “[d]on’t let his seeming lack of sophistication fool you. Kaufman PA is well funded, and Avi is a smart advocate.” Now, more than ever, take any filings from his office seriously.

1. Mike Greenwald, Greenwald Davidson Radbil, PLLC

As stale as the idea of holding the number 1 spot with the same firm, I just don’t see any compelling reason to move Greenwald down.

He is just as dangerous now as he was last year. Big wins continue to pile up behind the guy. And he has shown no signs of slowing down–a steady drumbeat of (mostly meritorious) TCPA filings continue to stream out of his office.

He is incredibly smart. Highly adaptable. Extremely well funded. And worst of all… supremely reasonable and thoughtful.

He may have even improved since last year now that he’s seemingly mastered the Czar-esque ability to disarm and lull others into a false sense of security. That’s my move Mike!

For those of you who missed my podcast episode with the guy you HAVE to give this thing a watch. This is the most dangerous man in TCPAWorld folks talking with our team (here).

The folks at Greenwald Davidson Radbil, PLLC remain the ultimate monsters lurking in the TCPAWorld woods. By the time they sue you, it may already be too late.

As I said last year: “when I give TCPA compliance advice its often the GDR firm I have in the back of my mind when I’m trying to help folks to avoid devastating exposure. When you’re even in the Czar’s head you definitely have earned your top spot on the TCPAWorld POWER Rankings.”

True then. True now.