Archives for April 2023

Minor procedural errors can be frustrating for debt collectors because they can lead to litigation, even where the consumer has not suffered any real harm. In a bit of good news, however, a recent case has handed a shield to debt collectors when it comes to procedural errors in litigation. 

In Ingersoll v. Brandsness et al (21-cv-01060; D. Or. 2023), a consumer filed suit against a collection agency for violating the Fair Debt Collection Practices Act (FDCPA). The consumer included a claim against the agency for filing a motion for default in a prior collection suit against the consumer. 

The only problem: The consumer had filed an answer to the suit, so there was no basis for a default. The motion was filed in error by the law firm and quickly dismissed by the Court.

The consumer argued that this erroneous motion amounted to an improper attempt to collect a debt. However, the court dismissed the claim finding that the error was only a minor procedural misstep and did not amount to an FDCPA violation. The court focused on the harm (or lack thereof) to the consumer and pointed out that there was nothing to remedy as the issue was quickly resolved by the state court.

Read the opinion here.

insideARM Perspective

This is, undoubtedly, a win for debt collectors. This decision doesn’t mean your organization should throw caution to the wind, or ease up procedural checks and balances. However, decisions like this are great to keep on hand if your organization or your law firm partners find themselves on the receiving end of a lawsuit based only on a cured, no harm, procedural misstep.   

On April 4, the U.S. District Court for the Northern District of Texas declined to increase or treble the plaintiff’s $8,500 jury trial damages awarded under the Telephone Consumer Protection Act (TCPA) after failing to find that the defendant acted willfully or knowingly under TCPA § 227(c)(5)(B). Indeed, the judge cut the award to $6,500. Since the TCPA does not have a fee-shifting remedy, that $6,500 win for the plaintiff is the total outcome of this federal court jury trial.

In Noviello v. Adam Wines Consulting, LLC, the plaintiff brought claims against the defendant for alleged violations of the TCPA related to telemarketing calls and texts sent to his personal cell phone for the purpose of providing business financing. At trial, the plaintiff offered evidence of 10 text messages and three voicemails from the defendant despite the plaintiff’s registration on the federal Do Not Call (DNC) registry. The plaintiff also provided evidence that four of these text messages followed the plaintiff’s cease and desist demand. The jury awarded the plaintiff the maximum statutory penalty of $500 per violation for each of the 13 calls under the plaintiff’s federal DNC claim (for a verdict of $6,500). The jury also found the defendant liable for sending the four texts after the cease and desist demand, awarding the $500 maximum penalty for each of those texts as well (for a verdict of $2,000 or a total of $8,500). In sum, the jury awarded the maximum amount it could, short of a willfulness finding.

After trial, the plaintiff petitioned the district court to: (1) enter judgment separately for the jury’s awards under the federal DNC registry claim and the internal DNC list claim because those claims were separate counts, granting the plaintiff the maximum verdict of $8,500; and (2) treble the plaintiff’s damages because the evidence showed the defendant exhibited a reckless disregard for its compliance with the TCPA.

The court declined both requests and instead entered judgment for the plaintiff on the jury’s verdict for only $6,500, cutting the award by $2,000.

On the issue of the plaintiff’s overall award, the court found that § 227(c)(5) does not allow for an award of statutory damages for each violation during a call, but instead limits statutory damages to one award per call, limiting the plaintiff’s overall award to $500 on each of the 13 calls, regardless of the separate counts. This resulted in the $2,000 cut to the jury award.

On the issue of treble damages, the court declined to find that the defendant willfully or knowingly violated the TCPA. Turning to the evidence presented at trial, the court found that there was not enough evidence to establish that the person who informed the plaintiff that the defendant would cease future calls was the same person who then texted the plaintiff again following the cease and desist communication. Without more evidence tying these text messages to the same individual, the court found that the plaintiff’s arguments for general and specific deterrence did not support the finding of treble damages and declined to increase the jury’s award.

MANCHESTER, United Kingdom — Phillips & Cohen Associates (UK) Ltd, the Manchester-based deceased account management business, has completed the acquisition of Ardent Credit Services Ltd, the Liverpool-based debt recovery and credit management services provider, following approval from the Financial Conduct Authority (FCA). Ardent will now formally become a wholly owned subsidiary of PCA’s UK business.

Adam Cohen, Co-Founder and Chief Executive of Phillips & Cohen Associates, says the announcement will help accelerate plans for integrating the two companies: “An approval process that we expected to take months has been completed in weeks. In our view, this reflects the confidence the FCA has in the credibility, professionalism, and senior leadership of our two organisations,” he says.

“We can now move quickly with our plans for closer collaboration, building on our long-term strategy to further extend the range of services we can deliver to our clients in the UK and internationally.”

Plans for the intended acquisition were announced in February and were subject to FCA approval. Steve Murray, the Founder and CEO of Ardent Credit Services, will stay in an advisory capacity in the short term to ensure a smooth transition of the business. John Ricketts continues as Managing Director, reporting to the Chief Operating Officer at Phillips & Cohen Associates, Nick Cherry. 

In completing the acquisition, PCA is adding 26-years of proven expertise and excellence in the UK collections industry, having been attracted by Ardent’s ‘digital first’ approach to business and a like-minded approach to how customers should be treated, which goes above and beyond the remit of Treating Customers Fairly.

Nick Cherry says that the ambition now is to grow: “It’s an exciting time for the business, our people, and the local community as we have the ‘green light’ from the FCA to write the next chapter in the PCA/Ardent history,” he concludes.

That’s a long title for an article and one that makes some lofty claims about the power of Credit Counseling. The premise behind this lengthy, bold statement is simple, “Prioritizing consumer financial health and well-being is good for business.”  

Help Consumers Help Themselves

Collection representatives interact with people at a crisis point in their lives, which puts them in a unique position to offer real help to consumers just when they need it most.  Yes, obtaining a commitment from a consumer to make payment on an account is the purpose of collections, but if they are struggling to make payments on other credit lines or to afford essential housing and living expenses, what is the likelihood that they’ll be able to stick to any agreed upon payment arrangements?

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Fortunately, non-profit Credit Counseling exists to help consumers get a better handle on their finances, especially when they are having trouble managing their debt. By partnering with a reputable non-profit credit counseling agency, ARM entities will have a trusted resource for their representatives to give consumers, showing that their organization cares about the consumer’s overall financial health and not just the accounts they are collecting on. This can provide some emotional relief to collection teams and make it easier for them to request payment on an account when they know they can connect struggling people to a counseling agency for valuable financial guidance at the conclusion of the call. 

What do Credit Counselors Really Do?

Once connected to a counseling agency, a certified Credit Counselor will complete a thorough review of the consumer’s financial situation, prepare a current and projected budget, and provide recommendations and resources specific to their financial situation.  If appropriate, the consumer will have an opportunity to enroll in a Debt Management Program, which is a structured repayment program for unsecured debt where a consumer repays their creditors over a 3 – 5 year term. This is not a debt settlement program. Consumers will pay 100% of their debt back but at lower interest rates.  

Credit Counseling’s holistic budget counseling and debt management program strives to put clients in a better position to meet all of their expenses, rather than having to decide which bill they can afford to pay each month. Any improvement the client can make to their personal finances will lead to higher recovery rates for their creditors.

Reputation is Everything

Beyond meeting professional standards, ARM entities can demonstrate though daily interactions that they care about consumers’ overall financial well-being by building access to credit counseling into their collection processes. 

See what the CFPB says about credit counseling here.

Considerations when Choosing a Reputable Credit Counseling Partner

These are the questions to ask when confirming the reputation of a credit counseling partner?

• Are they a member of one of the two major industry associations, the National Foundation for Credit Counseling (NFCC) or the Financial Counseling Association of America (FCAA)? This can be verified by visiting the Association’s websites: NFCC and FCAA

• Are they licensed to operate in the states that you do business? Some counseling agencies are licensed to operate nationally, while others may be licensed in just a handful of states. If you are a large collection agency, then it will be important to have national coverage, however, if you are an agency that operates in just a few states then you may want to consider working with a smaller agency doing business in the same area. 

• Does the agency have the capacity and partnering experience to handle your referral business?  You want to work with a counseling agency that recognizes that the quality of their performance as a referral partner is a reflection on the referring organization. Can they do “on the spot” counseling or do they need to schedule appointments? Do they have the reporting capabilities to track the metrics that are important to you.

Promote Credit Counseling with your Creditor Partners

Currently, the policy of many banks is to pull accounts back from collections if a credit counseling agency wants to include the account in a debt management program. This policy disincentivizes collection agencies from referring consumers to credit counseling for further assistance that would ultimately make them better payers. The collections and credit counseling industries should make a joint effort to encourage creditors to allow our industries to work more closely together for the benefit of consumers. At this point, it would be a great step to start the conversation with your creditor partners by pointing out the potential benefits mentioned in this article and suggest a 1 or 2-year pilot.

TAMPA, Fla. — OneTouch Direct, a global business process outsourcing company, today announced the formation of its newest company subsidiary, OTD Americas and the launch of state-of-the-art centers in Bogota (3 sites), Colombia, with ready available sites in Mexico City (3 sites) and added options for Eastern Europe and Asia.

OneTouch Direct with OTD Americas is focused on extending its suite of services for full account management for every phase of the account lifecycle. OTD Americas has invested in recruiting senior level industry leaders recognized for top tier partnership management, best in class performance delivery and quality service. These leaders have a long career history of working together successfully and providing unique contact services, collections, customer service (AML, loyalty retention, reactivation, education) programs for world recognized brands.

OTD Americas offers integrated omni-channel customer engagement solutions for care, customer service, collections, customer retention, back-office support and specialty program solutions designed to drive exceptional customer interactions and enhance our clients’ brands in US managed state of the art centers across Latin America. Focused on facilitating our clients’ low cost, high value strategic growth initiatives, OTD Americas partners with global brands to provide scalable, data-driven solutions across the full customer account lifecycle. 

“OTD Americas creates a significant global footprint with multiple operation and data center sites throughout the US, Colombia, Mexico, Asia, and Eastern Europe,” said Chris Reed, EVP of OneTouch Direct, “which complements our corporate strategy to provide multi delivery quality solutions for our client partners and their customers.” 

As an established contact center market, Bogota, Colombia, has excellent infrastructure, technology, utilities, and telephony combined with strong cultural and economic ties to the United States. Bogota offers a convenient, travel safe location with a highly skilled workforce, cost advantages, and proximity to the United States. In Bogota, OTD Americas’ state-of-the-art contact centers are strategically located in central business districts, university towns, and technical or commercial hubs with high-caliber candidates and convenient to public transportation, public services, retail stores ensuring workforce stability and low attrition rates.

With the formation of OTD Americas, we offer a choice of multiple state of the art facilities with a world class agent workplace supporting over 8,000 employees including a bilingual, US bicultural contact center featuring a robust personal development program including paid English language classroom program, hair and nail salon, indoor sports field, and 24-hour health care with doctor onsite among other employee focused amenities. With leading edge data and telephony technology using US-based co-lo centers, OTD Americas ensures high levels of security and strict compliance with industry standards.

About OTD Americas

OTD Americas, the nearshore subsidiary arm for OneTouch Direct, provides full service contact solutions from state of the art centers in Colombia, Mexico, Asia, and Eastern Europe with the ability to build to suit upon client demand. As a contact center outsourcing company, OTD Americas offers integrated omni-channel customer engagement for customer service, collections, back office support, and custom technology solutions designed to drive exceptional customer interactions and enhance our clients’ brands. Partnering with leading global brands representing clients in Banking and Financial Services, Consumer Auto, FinTech, Healthcare, Insurance, Media, Retail and e-commerce, Technology, Telecom, and Utilities industries, OTD Americas is focused on facilitating our clients’ strategic growth with Class A workplace, leveraging exceptional employee attrition rates, and ensuring brand protection in a competitive unique cost benefit structure. Our global delivery model offers flexible onshore, nearshore, offshore, and WAHA service options spanning the US, Mexico, Colombia, Asia, and Eastern Europe. 

About OneTouch Direct

OneTouch Direct, parent company for OTD Americas, is a US based business process outsourcing company delivering best-in-class customer experiences (CX) for some of the world’s largest and most loved brands. Rooted in our passion and deep expertise, OneTouch Direct creates unified brand experiences that break the rules and foster meaningful relationships. For over 20 years, our people-centric, data driven outsourcing solutions have powered better revenues and profitability across the full customer life cycle. For more information visit https://www.onetouchdirect.com/.

MINNEAPOLIS, Minn — DCM Services, Inc. (“DCMS”), a portfolio company of NMS Capital (“NMS”) names Scott Weddle to the position of Chief Operating Officer. 

Scott brings over 35 years of industry experience and has held various leadership positions at top-tier organizations, most recently at Fortitude Re and HomeServe USA. Scott provided leadership and expertise as the Assistant Vice President at Fortitude Re managing all telephony and technology applications while leading and forecasting multiple high-volume contact centers both directly within the domestic US and indirectly through offshore resources located in Manila. At HomeServe, he served as Vice President of Operations, leading an international team responsible for the strategic direction of the contact center and claims operations. 

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Michael Rosenthal, Chief Executive Officer of DCM Services commented, “Scott is a results-driven leader with a passion for building high-performance teams and creating a culture of accountability and continuous improvement. As COO of our company, Scott will leverage his expertise in operational strategy, process optimization, and team leadership to drive growth and deliver exceptional results for our customers and stakeholders, while improving on our already dynamic culture. We are excited to have him on board and look forward to his contributions to our success.”

About DCM Services

Minneapolis-based DCM Services is the industry leader in estate and specialty account resolution services, maximizing the value of client portfolios across financial services, healthcare, auto, retail, telecom, credit union, government, and utility industries through innovation and performance. Its recovery solutions offer a full range of services, from proprietary web-based solutions to full outsourcing, maintaining an unmatched spectrum of innovative solutions that increase recoveries, protect brand value, and enhance survivor relationships – with respect and sensitivity. For more information on all DCM Services’ offerings, please visit www.dcmservices.com. 

On March 30, 2023, a three-judge panel of the Superior Court of Pennsylvania held in a precedential opinion that debt collectors can send collection letters to debtors after the expiration of the statute of limitations without violating federal or Pennsylvania law, so long as the debt collector does not file suit in court.

The panel rejected plaintiff Starleen Matteo’s appeal of an Erie County judge’s decision to sustain preliminary objections filed by defendant EOS USA, Inc. on the grounds that its dunning letter did not violate the Fair Debt Collection Practices Act (FDCPA) or the Pennsylvania Fair Credit Extension Uniformity Act (FCEUA).

Matteo claimed that the EOS letter was false, misleading, and deceptive because “it offered financial freedom even though such freedom had already been obtained by virtue of the statute of limitations” and because it stated that EOS “was there to ‘help’ and ‘assist’ the debtor,” but did not advise her that the statute of limitations had already expired on her past due Verizon bill.

The court disagreed, opining that the expiration of a statute of limitations does not invalidate a debt, but simply makes it legally unenforceable: “As long as the debt collector does not initiate or threaten legal action on a time-barred debt, it is permitted to seek voluntary repayment without advising that the statute of limitations has run.” 

The court also rejected Matteo’s argument that the letter constituted a settlement offer because the letter did not use the word “settle” or imply that it was referring to settlement of the debt.  However, the court reasoned, in dicta, that even if the letter had contained such language, “this, standing alone, would not render the letter false, deceptive or misleading because there is nothing improper about a settlement offer.”  To that end, the court concluded, “the phrases, ‘willingness to work with you’ and ‘discuss other options’ cannot reasonably be read to imply a threat of litigation.”

Finally, the court upheld the trial judge’s ruling that Matteo did not plead an “ascertainable loss” by receiving the letter, as required by the FDCPA and FCEUA.

The Matteo opinion is a welcome outcome for the industry in Pennsylvania, but is not likely to have seen its last day in the news: Matteo’s counsel told Law360 he will request rehearing en banc and, if that fails, appeal to the Supreme Court of Pennsylvania.

Read the opinion here

NAPLES, Fla. — The Techno Brain Group Chairman and Board of Directors wish to announce the appointment of Mr. Joe Adams, Chairman and CEO of Hampton Pryor Group International Ltd., as the new Independent Non-Executive Director of Techno Brain’s Board, effective of 01 April 2023. Joe brings a wealth of experience and knowledge having worked in the ARM industry for over 35years. 

Joe holds a Bachelor of Science degree from Cheyney University and has done graduate work at the Southern Methodist University Edwin L. Cox School of Business. Additionally, Joe has completed both the American Bankers Association’s National School of Bankcard Management and Graduate School of Bankcard Management and completed executive management certificate programs at the Kellogg School of Management. During his career Joe has held senior management or C-Level positions at such leading financial organizations including First USA Bank/Bank One, CitiFinancial/Citi Group, Collins Financial Services and Asset Management Outsourcing among other entities.  Joe has been recognized twice by Collections Advisor Magazine, in 2018 as one of Who’s Who in Compliance and in 2019 as a Top 50 Receivables Professional of the Year. An ACA International Certified Instructor and Training Specialist, he has received the Fred Kirschner Instructor Achievement Award.

Joe will be responsible for developing and implementing strategies to drive Techno Brain Group’s BPO business growth. We are confident that Joe’s contribution will help take our company to new heights.

About Techno Brain Group

Techno Brain Group is a multinational technology company that provides innovative and cutting-edge solutions in the areas of Information Technology (IT), Business Process Outsourcing (BPO), Collections and Engineering Services. The company was founded in 1997 and mainly operates from Kenya, but has expanded its operations to several countries in Africa, Asia, and North America. With a focus on customer satisfaction and quality delivery, Techno Brain Group has earned a reputation as a reliable partner for businesses and governments seeking to harness the power of technology and services to achieve their objectives.

Techno Brain BPO is a leader in business process outsourcing that provides high quality and cost effective outsourcing solutions to clients worldwide. With a focus on accounts receivables management, legal back office and customer service, the company helps businesses streamline their operations and achieve their goals.

For more information contact:

Mr. Vinay Subbaramaiah (vinay.subbaram@technobraingroup.com)

ROSEVILLE, Minn. — Frontline Asset Strategies, a tech-enabled, nationally licensed and bonded full-service collection agency, is proud to announce that it has hired Justin Miller as its new Head of Operations. Justin Miller comes to the Frontline team from Vital Solutions. Mr. Miller has worked on various leadership teams across the industry for over 20 years and has directed teams across operations, business analytics, dialer teams, and customer services. 

“Justin is a great addition to our team, and we are excited for him to begin this next chapter in his career with us,” Tom Clement, CEO said. “As Frontline continues to expand its operations and provide more clients with fair, transparent collection and recovery solutions through advanced technologies and positive experiences, we knew bringing on an industry veteran like Justin would help steer our organization. Join us in welcoming Justin as our Head of Operations.” 

Mr. Miller has spent the last year as President of Vital Solutions. Earlier in his career, Mr. Miller worked as the Director of Operations at Vital before moving on to the PRA Group where he served in a variety of roles including Director of Operations, VP of Operations, and COO. Mr. Miller has spent his career focusing on the intersection of data and people to create a world-class customer experience via traditional and non-traditional collection channels. Justin Miller graduated from Georgia Southern University with a M.B.A. in 2000 and has since worked both home and abroad delivering advanced collection techniques and strategies. 

“I am excited to get started with the Frontline team,” Mr. Miller said. “Frontline’s exciting consumer-focused approach to collections provides both transparency and trust, two core values I have identified with during my career in the receivables industry. I’m honored to join the dedicated, experienced, and knowledgeable executive team at Frontline Asset Strategies and will continue to positively direct the FAST brand nationwide.” 

About Frontline Asset Strategies

Founded in 2008, Frontline Asset Strategies is a nationally licensed and bonded full-service collection agency specializing in accounts receivables management solutions that assist clients with maximizing the recovery of delinquent and non-performing accounts. The Frontline Asset Strategies team works with integrity and transparency to deliver positive consumer interactions that exceed expectations. The company is headquartered in Roseville, MN with an additional location in Jacksonville, FL.

MIAMI, Fla. — The law firm of Pollack & Rosen, P.A., is proud to announce that Marta Cortina has joined the firm as its Chief Financial Officer.

Marta brings more than 25 years of experience in financial planning, analysis and operational finance and has a proven track record of driving growth and building high-performance finance teams. 

Prior to joining the firm, Marta held leadership positions with many companies, including FedNat Holding, Inc., Verizon Communications, and Terremark Worldwide in Miami where she was Vice President of Accounting & Worldwide Controller.

President Joseph Rosen said “we are excited that Marta has joined the firm. I am confident that she will bring a wealth of financial experience to the table, which will benefit the firm and the clients we serve.”

Marta will play a key role in the organization by providing financial and accounting guidance, which will strengthen our core and improve client relations.

Marta earned a Master of Business Administration from the University of Miami and a Six Sigma Master Black Belt.

About Pollack & Rosen, P.A.

Headquartered in Miami since 1995, the firm is well positioned as an experienced and compliant partner dedicated to providing credit originators across the financial industry with exceptional Receivables Management expertise, along with superior Litigation Strategies for its clients.

Marta can be reached directly at (305) 448 0006 or via email at martac@pollackrosen.com.