When it comes to debt collection, state legislatures have been busy lately. ARM industry professionals have noticed it, the CFPB has encouraged it (see here, here, and here), and it may feel as if the industry is under pressure from all sides with some of the recent legislation and regulations. You might be wondering where some of these ideas are coming from and why it feels like there’s an uptick. One possible explanation, is the actions, rhetoric, and push for this type of legislation from the National Consumer Law Center (NCLC). Recently, NCLC provided a debt collection State Policy Resource that offers model legislation along with data, research, and consumer friendly studies. Here are the top three things you need to know about it:

1. Model Legislation Proposals

One of the NCLC’s aims is to impose stricter regulations on consumer debt collection practices. To that end, the State Policy Resource provides model legislation to affect different areas of debt collection: contracts and exemptions, wage garnishment, statutes of limitations, and medical debt. 

While each template has its own concerning provisions, the Model Statute of Limitations Reform Act might be the most troubling and we have already seen states attempting to implement some of the more drastic aspects. The model legislation would reduce the SOL to 3 years (with a shortest state provision) and reduce the validity of a judgment to 5 years with no opportunity to renew.

Recently, Minnesota’s Debt Fairness Act seemed to include the NCLC’s model language. It included the 3-year SOL, the 5-year judgment SOL, and the non-renewable judgments provision. Through the hard work of ARM industry professionals, those provisions have since been removed, but we will likely see more of this.

2. NCLC’s Negative Rhetoric

The NCLC is nothing if not exhaustive in what information it provides to consumers, law makers, and attorneys. However, the phrasing used in these documents sets the tone that debt collectors are to blame for debt problems. Some of the titles include:

• No Fresh Start 2023: Will States Let Debt Collectors Push Families Into Poverty as Economic Uncertainty Looms?
• Don’t Add Further Insult to Injury: Medical Debt & Credit Reports

The wording in both suggests that it is debt collectors pushing families into poverty (rather than low wages, inflation, etc.) and that collecting medical debt using one of the few tools available (credit reporting) is insulting. This rhetoric paints the debt collection industry as the bad guys and states are following suit with legislation that looks to make it more difficult for collectors without addressing the root causes of debt.

3. Data and Studies

The State Policy Resource has a long list of state policy indexes and reports, many of which provide state law comparisons for everything from exemptions to medical debt. To be clear, educating consumers and lawmakers about debt is never a bad thing, but much of what is shared is problematic for creditors and collectors.

For example, some of the sections seemed to be encouraging consumers to file consumer complaints and challenge the licensing of collectors. It should come as no surprise that collectors are seeing a high complaint volume, which bogs down an already complicated process.

The resource also shares some misleading studies. A recent issue brief shared in the document picks apart any research that shows a correlation between increased debt collection restrictions and any negative impacts to consumers for a variety of selective reasons. The NCLC then shares a study and claims that “wage seizure protections actually raised the amount of credit available and increased net benefits to consumers and credit providers” when the study states the direct opposite.

You can find the entire document here.

insideARM Perspective

The State Policy Resource poses significant challenges as it raises concerns around the model legislation influencing state lawmakers, the rhetoric employed within the resource demonizing debt collectors, and the document being marred by biases and inaccuracies all of which threaten to further complicate the landscape for creditors and collectors. In navigating this environment, ARM professionals must remain vigilant in the states they practice in and actively engage with policymakers to ensure balanced and fair regulations that uphold both consumer rights and industry viability. Otherwise, this document will be indicative of the direction debt collection legislation is heading.

Additionally, those in the ARM industry should consider ways to dispel the myth that debt collectors are harmful. Debt collectors are part of the financial ecosystem for a reason. For a variety of reasons, those in the ARM industry often stay silent when they see mistruths. However, the less we participate in the conversation, the more we allow inaccuracies, like those found in NCLC’s State Policy Resource, to flourish. 

On April 16, 2024, the Consumer Financial Protection Bureau (CFPB or Bureau) issued a procedural rule streamlining the designation proceedings for nonbank supervision based on a particular entity posing “risks to consumers.” As discussed in “Troutman’s Take” below, the changes are designed to encourage nonbanks to volunteer to be supervised, while making it easier for the CFPB to impose supervisory oversight when companies do not consent.

In 2013, the CFPB issued procedures to govern nonbank supervisory designation proceedings, but did not actually utilize those procedures, at least not that were highlighted publicly. In 2022, the CFPB announced that it would begin to make active use of this “dormant authority,” discussed here. The CFPB initiated its first public round of supervisory designation proceedings, discussed here, in 2023 and in 2024 issued its first supervisory designation order in a contested matter, discussed here.

The CFPB states that it is issuing the rule pursuant to its authority under the Consumer Financial Protection Act of 2010 to monitor markets for consumer financial products and services that pose risks to consumers and to conduct a risk-based nonbank supervision program for the purpose of assessing compliance with federal consumer financial laws.

Key Changes in the Rule

The new rule includes several key changes:

• Voluntary Consent to Supervisory Authority: The rule clarifies that a consent agreement does not constitute an admission and allows for case-by-case determination of the duration of supervision. Under the 2013 rule, all consent agreements were for two years. While the CFPB anticipates that will continue to be the typical duration, the new rule provides flexibility if a longer or shorter period is warranted.

• Notice of Reasonable Cause: The 2013 rule included methods of service patterned on how a notice of charges is served under the Rules of Practice for Adjudication Proceedings. To provide additional flexibility, the new rule also permits other methods that are “reasonably calculated to give notice.” The new rule also codifies that the initiating official may withdraw a Notice, whereas the 2013 rule did not expressly address this subject.

• Reply by Initiating Official: The new rule provides the initiating official with the option of filing a written reply to the response. Under the 2013 rule, there was no reply.

• Supplemental Oral Response: The rule gives the Director more flexibility regarding whether a supplemental oral response is in person at the Bureau’s headquarters, by telephone, or by video conference.

• Determination by the Director: The new rule merges the adjudicative roles of the Associate Director and Director in these proceedings, streamlining the Bureau’s internal decision-making process.

• Methods of Filing and Serving Documents: The rule clarifies the method of filing and serving documents, which will generally be by e-mail. The service of the Notice at the start of a proceeding, when a respondent’s e-mail address may not be known, is governed by a specific rule.

• Time Limits: The rule simplifies the former method for calculating time limits, which varied by delivery channel to allow additional time for mail or delivery services to arrive. This change aims to reduce confusion as e-mail is generally instantaneous.

• Word Limits: The rule introduces a word limit for the Notice, response, and certain other key filings, based on Federal Rule of Appellate Procedure.

• Confidentiality of Proceedings: The rule maintains the 2022 rule’s approach to the public release of final decisions and orders but clarifies that consent agreements entered into by the initiating official and respondent are not subject to the public release process (which, we understand, has been the Bureau’s practice since the 2022 announcement).

• Multiple Respondents: The rule clarifies that multiple respondents might be named in a Notice, as well as clarifying the process for adding an additional respondent or respondents to a pending proceeding.

• Issue Exhaustion: The new rule includes an express issue exhaustion provision that parallels the Rules of Practice for Adjudication Proceedings. This provision requires parties to give the agency an opportunity to address an issue before seeking judicial review of that question.

The rule is effective upon publication in the Federal Register. It applies to proceedings initiated on or after the effective date. It also applies to proceedings that are pending on the effective date, except to the extent the Director determines that is not just or practicable.

Troutman’s Take

Although the changes are procedural, they build upon the Bureau’s ongoing efforts to expand its supervision of nonbanks, especially fintechs. This procedural rule signals that the CFPB will increasingly encourage, and perhaps pressure, nonbanks to consent to be supervised, while simultaneously simplifying the process for the CFPB to impose its risk-based supervisory authority if companies do not consent. The CFPB’s risk-based designation process for nonbank is no longer “dormant.”

WEST SENECA, N.Y. — Landmark Strategy Group, a nationally licensed and bonded receivables management firm located in West Seneca, NY, has spent the last decade involved with dozens of Western New York (WNY) community groups, tackling issues from food insecurity to homelessness. To support its community, Landmark has spent the early part of 2024 volunteering at the FeedMore WNY Warehouse and supporting their Backpack Pack-Out Program, which assists children facing food insecurity over the weekends.

“Collaborating with FeedMore WNY epitomizes our commitment to community service,” said Mark Lesinski, Managing Partner of Landmark Strategy Group. “It’s not just about addressing immediate needs but fostering a culture of compassion and support that reverberates through our neighborhoods. We’re not just filling stomachs, we are helping those in need find a place of community, rest, and support.”

Supporting Those in Need

A cornerstone of their volunteer efforts at FeedMore WNY is their involvement in sorting and preparing emergency food boxes. These boxes, weighing approximately 20 lbs each, serve as crucial lifelines for many during times of crisis. With precision and care, the team at Landmark works diligently to ensure that these boxes are packed efficiently, containing essential items that can provide sustenance and relief to those in need.

Their commitment, however, doesn’t end there. Landmark understands the importance of addressing food insecurity at its core, particularly among vulnerable populations such as school children. They wholeheartedly support the backpack pack-out program, an initiative aimed at assisting WNY school children facing food insecurity over the weekends.

Operating discreetly, this program ensures that students receive food-filled backpacks every Friday, guaranteeing access to nutritious meals even outside school hours. Through close collaboration with local schools, Landmark ensures the seamless delivery of these essential supplies, significantly impacting the lives of the students they serve.

Taking Pride in Community Work

Their partnership with FeedMore WNY is about nourishing hope, dignity, and opportunity. It’s about showing up, standing together, and making a meaningful impact in the lives of those who need it most. That’s why, since its inception as a receivables firm in WNY, Landmark has worked closely with the community to ensure everyone is safe and secure, not just their employees. Throughout 2023, Landmark worked closely with FeedMore WNY to support holiday meal prep, community outreach efforts, and more. But the work in the community doesn’t stop there. Led by Mark Lesinski, Landmark is often found cycling, volunteering, or encouraging community work.

“We believe that every human deserves to live with dignity and hope and no act of kindness is ever too small. That’s why I try to lead by example and help our neighbors in need through volunteering with and donating to organizations that create an immediate positive impact,” Mr. Lesinski said. “Food and shelter are two of the most basic necessities for human survival and our team actively supports charitable organizations in our community that are effectively serving these critical needs for our neighbors.”

About Landmark Strategy Group

Landmark Strategy Group, LLC is a nationally licensed and bonded receivables management firm located in West Seneca, NY that specializes in passively purchasing non-performing receivables portfolios from credit unions and other sources. Mark Lesinski and the rest of Landmark’s executive team have a combined total of 60+ years of experience in the ARM industry and have developed efficient and compliant processes that deliver a quick valuation, streamlined purchase, and exceptional customer service after the sale.

Consumer attorneys are filing new class action lawsuits asserting that debt collector emails are being sent before 8 a.m. or after 9 p.m. in violation of the FDCPA. While debt collectors must adhere to the time restrictions for sending debt collection emails, it will be impossible for the consumer attorneys to certify any FDCPA class action asserting that a debt collector sent emails at an inconvenient time because email providers routinely delay the delivery of emails. As discussed below, this delay between when a debt collector sends an email and when the consumer receives the email necessitates an “individualized inquiry” to establish standing for each potential class member which will defeat any class action.  

Time-Restrictions on Sending Debt Collection Emails

The Consumer Financial Protection Bureau articulated in Regulation F that debt collection email communications violate 1692c as inconvenient if they are sent before 8 a.m. and after 9 p.m. local time for the consumer. Regulation F further provides that “an electronic communication occurs when the debt collector sends it, not, for example, when the consumer receives or views it.”   

Consumer attorneys are now asserting putative FDCPA class action lawsuits against debt collectors premised on the time that an email was received by the consumer. However, the time that a consumer receives an email is often different from the time that the email was sent by the debt collector, sometime by many hours.  

How to Identify Email Delivery Delays to Defeat a Class Action

An email that a consumer receives utilizing the Yahoo email platform does not, on its face, always disclose the actual time that the email is sent despite including a “time sent” field in the email. Yahoo publishes the following information on its website to assist consumers with accessing the “full header” on an email to determine how long an email was delayed:

In the example published on the Yahoo website above, the email is delayed “for about 1 hour and 15 minutes.” However, the recipient of the email would be unaware of this delay unless the recipient took the multiple steps outlined on the Yahoo website to access the “full header” for the email. Gmail likewise uses “predelivery scanning” to delay certain email messages before delivery, in some cases for hours.  

Email Delays Necessitate Individualized Standing Inquiries, thus Defeating Class Certification

While Regulation F provides that “an electronic communication occurs when the debt collector sends it,” the United States Supreme Court held in Ramirez v. TransUnion that each consumer seeking to participate in a class action must suffer some “concrete injury.” This standing requirement of a “concrete injury” is problematic for any FDCPA class action alleging that debt collection emails were sent at an inconvenient time because the receipt of emails are frequently delayed. How could a potential class member in an FDCPA lawsuit establish any “concrete injury” if a debt collection email that was sent at an inconvenient time is received by the consumer’s computer at a convenient time due to delivery delays by the email carrier?  

Thus, to determine whether a consumer qualifies as a member of any potential class action asserting that debt collection emails were sent at an inconvenient time, an individualized inquiry must be conducted to determine if the email was received at an inconvenient time by each member of the potential class due to email delays. For potential class members with a Yahoo email address, the multi-step process described on the Yahoo website and cited above must be used to identify the sending time in the full header.  

Notably, the requirement for an individualized inquiry regarding the actual receipt time of each email for each potential class member defeats the “predominance” or “superiority” element of a class action. The United States Supreme Court has held in Comcast v. Behrend that a class action is improperly certified if individual questions overwhelm questions common to the class. 

Conclusion

Any company facing class allegations that it sent debt collection emails at an inconvenient time – whether those allegations arise under the FDCPA, the Florida Consumer Collection Practices Act or some other law – should consider whether delays in email delivery may defeat these claims.  

TONAWANDA, N.Y. — Huntington Debt Holding, a nationally licensed receivables management firm located in Tonawanda, New York, has supported dozens of charitable organizations since its inception. As a way to continue support on a monthly basis, Huntington Debt Holding will be donating to FeedMore WNY, Tunnel to Towers, and St. Jude’s Hospital each month. 

With a profound belief in the power of collective action and compassion, Huntington Debt Holding stands alongside these organizations in their endeavors to positively impact society.

Feeding Western New York

FeedMore WNY, a regional food bank serving Western New York, stands at the forefront of the fight against hunger and food insecurity. Through its comprehensive network of food distribution programs, meal services, and community outreach initiatives, FeedMore WNY addresses the immediate needs of individuals and families facing hunger while also striving for long-term solutions. By supporting FeedMore WNY, Huntington Debt Holding contributes to ensuring that no one in the community goes without access to nutritious food, fostering resilience and well-being among its residents.

Honoring Heroes, Empowering Families

Tunnel to Towers Foundation honors the legacy of FDNY firefighter Stephen Siller, who sacrificed his life on September 11, 2001, by providing support to military and first responder families, veterans, and Gold Star families. 

Through its various programs, including mortgage-free homes, adaptive smart homes, and financial assistance, Tunnel to Towers offers tangible support to those who have served and sacrificed for the safety and freedom of others. Huntington Debt Holding’s partnership with Tunnel to Towers reflects its deep appreciation for the dedication and sacrifice of first responders and military personnel, ensuring that their families receive the support they deserve.

Healing Hope for Children

St. Jude’s Hospital, renowned for its pioneering research and compassionate care, stands as a beacon of hope for children battling cancer and other life-threatening diseases. Through its groundbreaking research initiatives and commitment to providing free treatment to every child, St. Jude’s ensures that families facing the unimaginable burden of childhood illness receive the support they need without the additional strain of financial worries. Huntington Debt Holding’s support for St. Jude’s Hospital underscores its commitment to ensuring that every child has the chance to live a healthy and fulfilling life, regardless of their circumstances.

Community Support is a Necessity

In a world where communities face myriad challenges, the importance of corporate support for organizations like FeedMore WNY, Tunnel to Towers, and St. Jude’s Hospital cannot be overstated. 

Huntington Debt Holding’s unwavering commitment to these organizations exemplifies its dedication to making a meaningful difference in the lives of those in need. By standing alongside these organizations, Huntington Debt Holding not only fulfills its corporate social responsibility but also embodies the spirit of compassion and solidarity that defines a truly caring community.

About Huntington Debt Holding

Huntington Debt Holding, LLC is a nationally licensed receivables management firm that specializes in the acquisition and management of non-performing accounts receivable portfolios and is proud to be a trusted partner to some of the nation’s largest issuers. HDH upholds the highest standards of compliance and integrity to provide a positive experience throughout every transaction. Huntington Debt Holding is located in Tonawanda, New York.

The insideARM editorial team aims to bring you the 3 things from the ARM Industry that you need to know each week. This week that included a piece about AI implementation, another state enacting a data privacy law, and the CFPB’s consumer complaint information. Keep reading for a breakdown of last week’s news and why we felt you needed to know about it.

Tuesday, we brought you an article about what questions you need to be asking if you are looking to incorporate AI into your operations. The questions centered around communications with consumers and how AI can help debt collectors and agencies keep up with the changes in consumer demographics, communications preferences, and new contact strategies. As AI utilization becomes more widespread, each organization should take the time to consider the right approach for their business goals. 

On Wednesday, we highlighted an article from Maurice Wutscher, LLP, that alerted the ARM industry to another state enacting a Data Privacy Law. On April 4, 2024, Kentucky became the 15th state to tackle data privacy when the governor signed the Kentucky Consumer Data Protection Act into law. Though the legislation seems reasonable and shouldn’t prove to be problematic for the collection industry, with the ever-growing list of states enacting these types of laws, we should still be paying attention.

With Thursday’s news, we wanted to draw attention to an article from Ballard Spahr addressing the CFPB’s 2023 Consumer Response Annual Report. The report shows that the vast majority of consumer complaints related to credit reporting with a focus on inaccurate information. The complaints about debt collection centered on whether the debt was actually owed, while the complaints in the credit card arena were largely disputing unauthorized transactions. These insights can help you guide your organization’s focus on compliance matters. 

We will be posting weekly recaps every Monday. If you missed the recap from the week of April 8th, click here to get caught up!

If you would like to talk about these issues and more with other industry professionals, click here to learn more about Research Assistant at insideARM to join our weekly peer group meeting.

Moss & Barnett is pleased to announce that attorney Issa K. Moe has rejoined the firm.

Issa returns to the firm after serving as General Counsel for ACA International, a trade association for the accounts receivable management industry. He focuses his practice on representing clients in litigation and providing counsel to clients on compliance, risk management, and general business matters. Issa regularly advises clients on compliance with consumer financial laws and regulations, including the Fair Debt Collection Practices Act (FDCPA), Fair Credit Reporting Act (FCRA), and Telephone Consumer Protection Act (TCPA). He also represents clients in class action litigation and regulatory actions brought under those and similar financial laws and regulations.

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Issa has extensive in-house legal experience as both General Counsel and Chief Compliance Officer for companies. In those roles, he built compliance management systems, managed client and regulator audits, examinations, and other proceedings, and handled a wide variety of business and corporate legal matters. Issa also has extensive experience representing debtors, creditors, trustees, and other parties in bankruptcy matters, including preference and fraudulent transfer actions.

Issa received his J.D., cum laude, from the University of Pennsylvania Carey Law School and his B.A. from the University of Virginia.

The CFPB published its Consumer Response Annual Report for 2023, which discusses the consumer complaints received by the CFPB in that year and how companies responded to those complaints. The CFPB monitors consumers’ complaints and companies’ responses in order to glean information about the types of challenges consumers are experiencing with financial products and services. As a part of its monitoring, the CFPB reviews a sample of complaints and company responses to ensure the responses are accurate, timely, and complete.

 The CFPB also monitors for patterns and trends in the types of complaints submitted by consumers and the companies who are the subject of complaints for purposes of prioritizing CFPB action. In 2023, the CFPB sent more than 1.3 million complaints to more than 3,400 companies for review and response. Of these, 79% related to credit and consumer reporting, 7% related to debt collection, 4% related to credit cards, 4% related to checking and savings accounts, and 2% related to mortgages. A smaller percentage of complaints were related to a variety of other product types, including money transfer services, auto loans, and student loans.

Credit and Consumer Reports 

According to the report, the vast majority of complaints (1.1 million complaints) were related to credit and consumer reporting issues, with over 1 million of them directed to the three nationwide consumer reporting agencies (CRAs). In 2023, the most common complaint was about incorrect information on a credit report. Consumers complained about inaccurate information pertaining to account balances, account opening dates, payment dates, bankruptcies, payment statuses, inquiries, and personal information. Some consumers complained about the need to follow up with CRAs multiple times in order to address issues, such as fixing inaccurate information, or resolving matters that were not properly investigated.

The CFPB noted an increase in consumer complaints about identity theft. Consumers complained about credit bureaus reporting new accounts and credit inquiries appearing on their credit reports that they did not initiate and did not recognize. Consumers reported having difficulties removing the inaccurate information, even after providing additional evidence, such as police reports or FTC documentation regarding the identity theft claim. According to the CFPB, CRAs had inconsistent approaches to responding to these complaints, including removing some, but not all, inaccurate information, blocking some of the disputed accounts, denying the requests entirely, or requesting more proof for identity theft claims. The CFPB states that consumers described frustration with the time and cost associated with contacting CRAs and data furnishers to have inaccurate information removed. Consumers also reported difficulties in receiving information from CRA representatives when they attempted to gain a better understanding of how their credit score is calculated, and how inaccurate information affects the score. Last year, we blogged about another CFPB report on the complaints submitted to the CFPB regarding the three nationwide CRAs, which echo many of the same issues discussed in this year’s report.

Debt Collection 

The CFPB reports receiving approximately 109,900 debt collection complaints, regarding both first-party and third-party collectors. Of the debt collection complaints, the common issue described by consumers was that they did not owe the debt, which the CFPB states has been the predominant issue reported by consumers since the Bureau began accepting debt collection complaints in 2013. In many of these instances, consumers requested that debt collectors validate debts that had been disputed. Consumers also complained of harassing or abusive communications from debt collectors, which included high frequency of calls and receiving calls outside of permitted hours. The Bureau reports that older consumers and servicemembers both submitted a higher number of complaints regarding mortgage debt, claiming that the debt was not owed or that it was discharged in bankruptcy. The company responses to these complaints often included an explanation that the debts were valid. We have blogged on a variety of debt collection issues recently, as debt collection complaints continue to draw the attention of both federal and state regulators.

Credit Card 

According to the report, the CFPB received approximately 70,000 credit card complaints. The most commonly reported issue concerned inaccurate or unauthorized purchases shown on credit card statements, which the CFPB notes is a complaint category that has increased over the past few years. Some consumers claim that after reporting unauthorized transactions and being told to expect a permanent or temporary credit to their account, they never received the credit. Some consumers report being instructed by card companies to contact merchants directly for resolution. When attempting to address card statement issues, consumers reported that they experienced “extended hold times and unhelpful representatives, received incomplete and incorrect information, and had calls disconnected […] and having to make multiple calls to resolve issues.” Other credit card issues included not receiving promotion benefits or the closing of credit card accounts without notification.

Checking and Savings Accounts. The common issue regarding checking and savings accounts reported by consumers was difficulties in managing an account. Many consumers complained about unauthorized transactions posted on their accounts, often involving peer-to-peer platforms. Additionally, consumers experienced difficulties, such as long wait times and disconnected calls, when contacting companies to resolve issues. Companies often apologized for the inconveniences and customer service issues. According to the CFPB’s report, consumers complained about being charged overdraft fees on transactions that were not paid or were unauthorized, and that companies changed the posting order of transactions leading to increased overdrafts. Companies often explained to consumers that overdraft fees are based on account activity, but companies sometimes refunded overdraft fees as a “courtesy.”

Mortgage

The majority of mortgage complaints were about conventional mortgages, specifically trouble during the payment process. Many consumers complained about forbearance and loss mitigation processes, claiming they received confusing or conflicting information about deferral options and that companies failed to comply with Homeowner Assistance Fund plans. Consumers also complained about having a hard time reaching servicers, and that phone calls and emails went unanswered. Consumers complained about late and other fees, negative credit reporting, loss mitigation delays, and foreclosure threats when resuming payments after filing for bankruptcy or ending a forbearance period. Companies indicated a variety of reasons for these issues, such as consumers making late payments, submission of incomplete loss mitigation applications, and mortgage servicer system errors causing incorrect fees to be charged, but that were refunded.

Other

In addition to the issues discussed above, the report covers consumer complaints for personal loans, prepaid cards, credit management, payday loans, title loans, and deposit advances. While there are differences in the number of complaints per product type, the percentages regarding complaints resolved with monetary relief, resolved with non-monetary relief, closed with an explanation provided or closed with an administrative response when action could not be taken, in general appear to be about the same across complaint types. The CFPB indicated that companies overwhelmingly met the timeliness expectations for responding to complaints, with about 99.6% of complaints being met with a timely response. Generally, companies responded with relief or with an explanation to consumers about issues the consumer may have misunderstood regarding their financial product or service. The Bureau encourages companies to use complaint information to gain knowledge about their business, potential risks, and consumer needs.

CHESAPEAKE, Va. — Spring Oaks Capital, LLC is pleased to announce the hiring of Ellen Doherty as Controller. Ellen will be based in the Company’s headquarters in Chesapeake, Virginia and report directly to Chief Financial Officer John McNeill. 

Ellen brings an extensive background in financial services, including prior roles as Director of Accounting at Tidewater Mortgage Services, Assistant Controller at LoanCare, and VP, Controller and Senior Accounting Officer at Hampton Roads Bankshares. In her role as Controller at Spring Oaks Capital, she will be responsible for all accounting functions across the operating company and its affiliates.

John McNeill, CFO, stated, “We are excited to have someone of Ellen’s talent and experience join the Spring Oaks Capital finance team. The Company has been experiencing rapid growth, and Ellen is an important addition to our highly experienced management team.”

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About Spring Oaks Capital, LLC

Spring Oaks Capital is a national financial technology company, focused on the acquisition of credit portfolios. The Company subscribes to an employee and consumer-centric operating philosophy that creates high-value jobs, a significant performance lift, and the highest standards of compliance. Spring Oaks’ business strategy is rooted in innovative data-driven technology to maximize collection results and a contact platform that offers multi-channel options to meet each consumer’s communication preference. To learn more about Spring Oaks, please visit www.springoakscapital.com.

Kentucky Gov. Andy Beshear on April 4 signed into law House Bill 15, the Kentucky Consumer Data Protection Act, making Kentucky the 15th state to enact a comprehensive consumer data privacy law following California, Virginia, Colorado, Utah, Connecticut, Iowa, Indiana, Tennessee, Montana, Texas, Oregon, Delaware,  New Jersey, and New Hampshire.  The law will go into effect Jan. 1, 2026.

Applicability

The Act applies to persons that conduct business in Kentucky or produce products or services that are targeted to Kentucky residents and that during a calendar year control or process personal data of at least:

1. 100,000 consumers; or
2. 25,000 consumers and derive over 50% of gross revenue from the sale of personal data.

Exemptions

Exemptions include, but are not limited to:

1. Financial institutions, their affiliates, or data subject to Title V of the Gramm-Leach-Bliley Act, 15 U.S.C. § 6801, et seq.;
2. Covered entities or business associates governed by the privacy, security, and breach notification rules established pursuant to the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”);
3. Protected health information under HIPAA;
4. The collection, maintenance, disclosure, sale, communication, or use of any personal information to the extent that such activity is regulated by and authorized under the Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq.

Consumer Rights

Consumers have the right to:

1. Confirm whether a controller is processing their personal data and to access such personal data;
2. Correct inaccuracies in their personal data, taking into account the nature of the personal data and the purposes of processing the data;
3. Delete personal data provided by or obtained about the consumer;
4. Obtain a portable copy of the personal data that they previously provided to the controller;
5. Opt-out of the processing of the personal data for purposes of targeted advertising, the sale of personal data, or profiling in furtherance of decisions that produce legal or similarly significant effects concerning the consumer.

Sensitive Data

A controller may not process sensitive data concerning a consumer without obtaining the consumer’s consent, or, in the case of the processing of sensitive data collected from a known child, process the data [except] in accordance with the federal Children’s Online Privacy Protection Act 15 U.S.C. § 6501, et seq.

“Sensitive data” means a category of personal data that includes:

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

Contract Requirements

A contract between a controller and a processor must govern the processor’s data processing procedures with respect to processing performed on behalf of the controller and clearly set forth instructions for processing personal data, the nature and purpose of processing, the type of data subject to processing, the duration of processing, and the rights and obligations of both parties.  The contract must also require that the processor:

1. Ensure that each person processing personal data is subject to a duty of confidentiality with respect to the data;
2. At the controller’s direction, delete or return all personal data to the controller as requested at the end of the provision of services, unless retention of the personal data is required by law;
3. Upon the reasonable request of the controller, make available to the controller all information in its possession necessary to demonstrate the processor’s compliance with the obligations in the Act;
4. Allow, and cooperate with, reasonable assessments by the controller or the controller’s designated assessor, or the processor may arrange for a qualified and independent assessor to conduct an assessment of the processor’s policies and technical and organizational measures in support of the obligations under the Act, using an appropriate and accepted control standard or framework and assessment procedure for such assessments. The processor must provide a report of the assessment to the controller upon request;
5. Engage any subcontractor pursuant to a written contract that requires the subcontractor to meet the obligations of the processor.

Data Impact Assessments

A controller must conduct and document a data impact assessment of each of the following processing activities:

1. The processing of personal data for the purposes of targeted advertising;
2. The processing of personal data for the purposes of selling personal data;
3. The processing of personal data for the purposes of certain profiling;
4. The processing of sensitive data; and
5. Any processing that presents a heightened risk of harm to consumers.

Enforcement
The Attorney General has exclusive authority to enforce violations. For any violation that is not cured within 30 days of notice, the Attorney General may seek damages up to $7,500 for each violation.

Impression

The Kentucky Consumer Data Protection Act is sensible legislation that balances the rights of consumers with the impact on businesses. The Act follows the pattern of many post-California comprehensive data privacy laws and should not present overly burdensome compliance challenges for those that must comply with one or more of the other laws. For a chart comparing the state comprehensive data privacy acts, and more information and insight from Maurice Wutscher on data privacy and security laws and legislation, click here.