On March 30, 2021, the U.S. Supreme Court will hear oral arguments in TransUnion v. Ramirez. [1] The issue before the Court in this Fair Credit Reporting Act case is whether Article III of the Constitution or Federal Rule of Civil Procedure 23 permits a damages class action where the vast majority of the class suffered no actual injury, let alone an injury anything like what the class representative suffered. If decided in TransUnion’s favor the decision could provide credit reporting agencies with a valuable tool to defeat “no injury” FCRA class action lawsuits.

A real-world example illustrates how. Last August the U.S. District Court for the Southern District of New York certified a class of consumers in McIntyre v. RealPage, Inc. [2] The class included thousands of individuals whose consumer reports allegedly contained inaccurate and outdated eviction records obtained from LexisNexis (“Lexis”) by RealPage subsidiary On-Site (“On-Site”). On February 17, 2021, the McIntyre Court stayed the case pending the outcome of the U.S. Supreme Court’s ruling in TransUnion v. Ramirez.

Background on McIntyre v. RealPage

On-Site provides tenant screening services to landlords and property managers nationwide. Plaintiff, who claimed to have been denied housing due to inaccurate and outdated eviction records in On-Site’s report, alleged On-Site violated § 1681e(b) of the FCRA by relying on summary information purchased from Lexis as opposed to the most up-to-date information available at courthouses where the records themselves are housed. Plaintiff claimed On-Site’s exclusive reliance on this data was “willful and carried out in reckless disregard for consumers’ rights”, entitling her and the class to statutory damages of from $100 to $1,000 per class member, plus attorneys’ fees.

McIntyre Court Grants Class Certification

On-Site opposed plaintiff ‘s motion for class certification by arguing that Rule 23’s “typicality” requirement could not be satisfied due to the individualized nature of each class member’s claim. The court rejected this argument finding that On-Site had attempted to “foist additional requirements” onto a FCRA willfulness claim in suggesting that individual analyses into causality and damages would be necessary. The court found that because plaintiff was seeking uniform statutory damages based on On-Site’s alleged willfulness, causation and actual damages were irrelevant. The court concluded that the issue typical to all class members’ claims was that On-Site used “the same vendor, LexisNexis, and accepted its reports at face value.” The court pointed out, “unlike with negligence claims, actual damages and causation are not elements of a willfulness claim.”

A Favorable TransUnion Decision Would Reduce Class Exposure for CRAs

TransUnion argues that the vast majority of class members in its appeal fail to satisfy Article III standing because they did not suffer the requisite constitutional “concrete harm,” as established by the Supreme Court in Spokeo, Inc. v. Robins. [3] That decision made clear that a plaintiff cannot “allege a bare procedural violation [of the FCRA], divorced from any concrete harm, and satisfy the injury-in-fact requirement” of Article III. Rather, the injury at issue must be “real,” and not merely “abstract” or speculative.

Applied to McIntyre v. RealPage, Inc., the argument is that the Court should not have certified the class without having determined whether each class member had suffered real and concrete harm due to inaccurate or out-of-date information in a report. For example, a consumer who qualified for an apartment despite an inaccuracy in their report could not be included in the class, especially if they were unaware of the inaccuracy.

Conclusion

The Supreme Court’s ruling in TransUnion v. Ramirez could substantially reduce class action exposure for background screeners and other CRAs to “no injury” FCRA class action lawsuits. Upholding Spokeo’s “concrete harm” requirement would insulate CRAs from liability to class members alleging hypothetical harm that could have occurred, but never did.

[1] 951 F.3d 1008 (9th Cir. 2020), cert. granted in part, No. 20-297, 2020 WL 7366280 (U.S. Dec. 16, 2020).

[2] No. 18-3934, 2020 U.S. Dist. LEXIS 153885 (E.D. Pa. Aug. 25, 2020).

[3] 136 S.Ct. 1540, 1548-50 (2016)

In this episode, Stephanie Eidelman, insideARM President & CEO, interviews Todd Meeks, Director of Product Management for Neustar. Watch Stephanie’s conversation with Todd, or read it below.

Stephanie Eidelman:

I’m Stephanie Eidelman, CEO and president of The iA Institute and insideARM. And I’m here today talking with Todd Meeks, Director of Product Management at Neustar. For over 20 years the top 10 banks, top 10 credit card issuers, and hundreds of top brands have relied on Neustar to improve their bottom line by helping them connect with customers efficiently and effectively. So, Todd, thanks so much for being with me today for this executive interview. So, to start, can you tell me a little bit about yourself and your role at Neustar?

Todd Meeks:

Hey Stephanie, and thanks for the opportunity to talk today. I’m the Director of Product Management within our risk unit, where I lead a team that helps our customers optimize their outbound communication strategies. Prior to joining Neustar, I was at Citi Group for nine years where I led a team that supported their global digital channel strategy. Before Citi Group, I held leadership roles at Fifth Third Bank and Broadway Communications, and I started my career at Cincinnati Bell Telephone. So at Neustar, my customers are typically in the recovery space, where we help them to cleanse their CRM data, determine the best phone numbers to use for outbound contacts and identify the best time for them to make outbound contact attempts so that they improve the right party contact rates. It’s very important that we constantly evolve and improve our data products. And I’m also leading the internal effort to establish a platform that will utilize our data on behalf of our customers so that they can realize the benefits that our insights

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Stephanie Eidelman:

So you’ve sat on both sides of the fence, which I’m sure really helps you in your role and helping your customers. You mentioned that you’ve spent quite a few years at a large bank and other organizations, how does that experience inform your current work?

Todd Meeks:

Yeah, so again, before joining Neustar, I was at Citibank, and I was there at a time where there was an increased focus on complying with TCPA guidelines, especially with the release of the declaratory ruling in 2015. So I was responsible for bringing Citi’s legacy infrastructure into compliance with all of these guidelines. I worked with the legal and risk teams to formulate their position and then align their systems and processes to that, which gave me a lot of experience in the regulatory compliance space. So much so that I became the primary witness for Citi concerning litigation specific to class action defense with TCPA. So combining this experience with the telecom positions that I held at the beginning of my career, the move to Neustar was kind of a logical evolution. So Neustar has an extensive network of trusted sources. And that includes direct relationships with all of the major carriers which I’ve worked with in the past. At Citi, we integrated Neustar data for the TCPA infrastructure primarily, and then expanded it into our collection strategy to identify best numbers to dial and also when to dial them. So I think that coming to Neustar allows me to bring over that customer experience, like you said, and an internal voice of the customer, which only makes our product stronger here.

Stephanie Eidelman:

So all things really are coming full circle. You also mentioned that it was your responsibility to manage through transforming legacy technology to allow for new regulations. And that certainly is going to be facing a lot of companies moving forward. And of course that brings us to the, unless-you’ve-been-under a-rock-topic, you know that the CFPB has finally released Regulation F that we had been waiting for for seven years. It came out a few months ago and everyone is now working to get prepared for that when it will go into effect, at least we think it will go into effect, on November 30th. How is Neustar thinking about the new requirements and what are you working on?

Todd Meeks:

So I guess first of all, I think everybody would probably like to crawl back underneath that rock and pretend that never happened.

Stephanie Eidelman:

At least not to read the thousand pages of regulation that came out.

Todd Meeks:

Right, or two or three times reading the thousand pages. But Neustar is looking at several aspects of Reg F to determine how we can help our customers minimize the impact on their operations. The majority of the feedback that we have received, or at least I have received, so far is focused on the so-called seven-in-seven rule, and the ability to expand the use of email for communication. So, just to level set, the seven-in-seven rule concerns the limitation for collectors to only make seven outbound contact attempts in seven days. Now, one interesting component of this which occasionally is overlooked, is that it is a rolling seven days, not a calendar. So this makes it very difficult to schedule more than one attempt per day, since you need to track those days with increased intensity. So you can make sure that you have an attempt available every day that you want to make that next attempt.

So many companies are planning to align with this by only making one outbound attempt per day, which would ensure that you always have an attempt available each day, but to be honest, we feel that approach is kind of giving in. We all know that a single, pass single intensity each day is not going to deliver the same level of RPC or right party contact that companies receive today. Especially if you consider that each of those accounts that you’re collecting on will likely have more than one phone number associated with it. So the odds are very low for dialing the correct and best number on the right day at the right time, if you don’t have accurate behavioral data for those phones. So Neustar is able to provide that data that satisfies that right day, right time need.

But again, going back to the platform, we’re also developing this platform that utilizes our own data to create a monthly strategic map by account, which identifies the best days to make outbound attempts. The platform will allow for targeted increased intensity for phones on those best days, by dialing in and around that best hour to call, and then zero intensity on days when there’s less likelihood of a contact. So on those days where zero intensity is recommended for outbound voice, then we can recommend additional channels, say an email or an SMS. And this way you can maintain that continual contact stream of the customer and maintain more than single intensity for outbound voice on the days that you’re making these attempts, while still being compliant with Reg F. So, I think this type of approach offers the best chance for our customers to maintain or improve their RPC rates under the new rules. From an email perspective, we’re expanding and improving our behavioral data. We have quite a bit already, but again, it’s that constant improvement and expansion of it. And we’re also offering the ability to determine whether that email address that our customer has is primarily business or consumer based, which then helps with the ability for collectors to expand the use of this channel for the communications that are pretty much opened up based upon the updated rules.

Stephanie Eidelman:

Yeah. But still have to be tracked, right? Even though there aren’t the limitations in theory on those other channels, you certainly don’t want to end up being blamed for harassment.

Todd Meeks:

Right. And especially since section 806 of the original law is noted, and that’s actually specifically called out. So I think we always see that whenever any of these regulatory changes come through, there’s kind of a cottage industry of lawyers that’s created to go out and read through that and identify it. I think that the original regulation was kind of silent on what is harassment. There wasn’t a black and white definition of it. I would anticipate that this allows that kind of precedent to be set. Like it sets that in saying, well, if seven calls in seven days on voice, doesn’t count as harassment, maybe the digital channels now — by default, not by specific meaning, but will they inherit that now that is the same standard for digital channels? Or is it a combination of the two? So I think we’re going to see a lot of litigation coming through kind of challenging that, trying to define that. So that’s why we’re looking at it from a perspective of saying, we understand we need to comply with that seven-in-seven for the voice, but maybe layering in, not 10 emails a day, but maybe one a day on those off days so it attempts to pull back on that, and not qualify for harrassment.

Stephanie Eidelman:

Of course the other thing that everyone will end up keeping in mind is that the reality is you can’t send 10 emails that remain unanswered a day because that channel will then be cut off to you. It will be deemed as spam by the sender by the provider. And, the consumer probably won’t ever receive them.

Todd Meeks:

Right. And that kind of falls into that same category. So if you look at it from a skip perspective, if I do skip tracing on phones, I may get, let’s just say 10 phones. I get those back. Maybe only one or two of those actually belong to that person. But when I’m calling those, even if I’m dialing them manually, I’m still making 10 attempts. So I may have two or three email addresses for a customer, but if I send one email to each of those, it may not qualify as spam because it’s going to different email addresses, but it’s still being counted as that those are all clicks going to that person. So, yeah, I completely agree. There’s, there’s so much vagary in the updates that were given that I just think that there’s going to be a lot of challenge to it.

Stephanie Eidelman:

There will be a lot of new gray areas to replace the gray areas that got clarified.

Todd Meeks:

Right.

Stephanie Eidelman:

Well, Todd, thanks so much. This has been great. I’ve enjoyed getting to know you and hearing about what Neustar is up to as it relates to the new rules. So thanks so much for joining me.

Todd Meeks:

All right. Well, thank you Stephanie, for the opportunity to talk to you.

ROCKVILLE, Md. — The iA Institute and insideARM are proud to announce that Erin Kerr has joined the team in the role of Director of Content, leading our strategy and technology line of business. Erin will step in as chair of iA Strategy & Tech, a cutting-edge digital conference designed for receivables professionals responsible for strategy and technology adoption. 

In addition to chairing iA Strategy & Tech, Erin will plan related content across all iA channels and will be taking on a key leadership role in the Innovation Council, an exclusive membership group focused on solving big industry challenges through technology and collaboration. The group was founded in 2017.

With more than 8 years in the industry, Erin is a seasoned receivables management professional. Immediately prior to joining insideARM, Erin served as Director of Digital Strategy at MRS BPO, LLC, a New Jersey-based accounts receivable and back-office solutions provider with a 25-year history in the industry. In her three years at MRS BPO, Erin advanced quickly, having started as a Contact Process & Policy Administrator. 

Most recently, as Director of Digital Strategy, Erin was responsible for testing and implementation for Adam, MRS’s new proprietary conversational IVR tool. She also managed the launch for outbound texting with MRS’s largest client. 

Erin started her career as a client liaison for the creditors’ rights attorney firm Lyons Doughty Veldhuis in 2013, where she served as a client relationship manager for five years. [article_ad]

Originally from New Jersey, Erin attended Rutgers University and graduated with a degree in English. She currently resides in Cherry Hill, New Jersey. Outside of work, Erin is passionate about Philly rock/punk rock – preferably heard live – as well as reading memoirs and historical fiction. During the pandemic, she has become an accomplished cook as well.

Stephanie Eidelman, CEO of The iA Institute said, “We are really excited about Erin joining us. She’s been trained by the outstanding team at MRS, which has been on the leading edge of technology for quite a few years. She is also a sharp and thoughtful professional whose vision will help inform and enhance all of our strategy and technology content.”

About The iA Institute

The iA Institute is a media company that provides news, education, events and connection for professionals in consumer finance. The iA team believes the value of your time and investment in our content should be undeniable, so we thoughtfully design everything we do with a focus on the details that make a difference. Our initiatives include the flagship website and newsletter insideARM; the Consumer Relations Consortium (CRC) and iA Innovation Council membership groups; the iA Research Assistant and Case Law Tracker premium subscriptions; the iA Strategy & Tech digital conference; and the uniquely engaging annual Women in Consumer Finance event. iA is a certified Woman-Owned business.

On March 22, 2021, through a press release, the Consumer Financial Protection Bureau (CFPB) announced that it released its annual report to Congress regarding the administration of the FDCPA.  The 55-page report makes it clear that the CFPB and Federal Trade Commission (FTC) remain steadfast in their efforts to protect consumers, particularly those who have suffered profound financial impacts due to the COVID-19 pandemic.  Further, the challenges of 2020 did not stop the CFPB from filing enforcement actions or weighing in on matters it found important.

Consumer Focus

After a letter from Acting Director Uejio which stresses that the CFPB remains locked-in on helping consumers through the Covid-19 pandemic, the report outlines the steps taken by the CFPB to protect consumers despite the challenges of 2020. In May of 2020, the CFPB rescheduled about half of its planned examination work. Instead of examinations, the Bureau conducted prioritized assessments (PAs) designed to obtain real-time information from a broad group of supervised entities that pose an elevated risk of consumer harm due to pandemic-related issues. Examiners reviewed the potential for FDCPA compliance risk associated with temporary restrictions on wage garnishment and bank attachments.

Additionally, the CFPB’s focus on consumer interaction with debt collectors and consumer complaints has not faltered. Per the report, consumer debt and non-housing debt reached an all-time high in the first quarter of 2020, and 26% percent of consumers have a third-party collection tradeline on their credit report. From January 1, 2020, through December 31, 2020, the CFPB received approximately 82,700 debt collection complaints, which increased roughly 10 percent compared to 2019. The most common complaint from consumers (49% of all complaints) was that they were being pursued by a debt collector for a debt they do not owe; the second-highest group of consumer complaints (20%) related to written notifications about the debt. Complaints regarding threatening someone or sharing information improperly were the least complained about debt collection issue in 2020.

The Bureau continues to look for ways to educate consumers. Many of the CFPB’s materials are available in multiple languages, including “Ask CFPB,” an interactive online consumer education tool that logged 1.9 million pageviews and/or downloads in English and 220,000 in Spanish for its debt collection questions. In November 2019, the Bureau released a video with useful tips to spot debt collection scams and steps that consumers can take to protect themselves from scammers; since its launch, it has been viewed more than 4,500 times.

Finally, to better understand debt collection and its impact on consumers and credit markets, before publishing Regulation F, the CFPB conducted a quantitative online survey of over 8,000 respondents to test several versions of disclosures to support consumer understanding of certain concepts. The intent of this research is to help the Bureau better understand the benefits, costs, and impacts of potential rules. 

Enforcement Actions

Despite the challenges of 2020, the CFPB filed four new enforcement actions, which include:

• A complaint against Encore Capital Group (Encore) in which the CFPB alleged Encore and its subsidiaries violated its 2015 consent order with the CFPB by suing consumers without possessing the required documentation, using law firms and an internal legal department to engage in collection efforts without providing required disclosures, and failing to provide consumers with required loan documentation after consumers requested it. The case was settled in October of 2020.

• A complaint against JPL Recovery Solutions (JPL) in which the CFPB alleged that from at least 2015, JPL participated in a debt-collection operation that has used deceptive, harassing, and improper methods to induce consumers to make payments to them in violation of the FDCPA and the CFPA.

• A consent order with RAB Performance Recovery (RAB), in which it was established that RAB threatened to sue, sued, and demanded payment from consumers in Connecticut, New Jersey, and Rhode Island even though RAB did not hold the licenses that those states required to sue to collect debts.

• A complaint against BounceBack, Inc. (Bounceback) in which the CFPB alleged that in the course of administering bad-check pretrial-diversion programs, BounceBack used district-attorney letterheads to threaten more than 19,000 consumers with prosecution if they did not pay the amount of the check, enroll and pay for a financial-education course, and pay various other fees.

Amicus Briefs Filed by the CFPB

Worth noting, the CFPB filed two amicus briefs in 2020. In DeGroot v. Client Services, Inc., the Bureau argued that the debt collector did not violate the FDCPA when it accurately disclosed the total amount of the consumer’s debt and correctly specified that $0.00 in interest and other charges had been added to a charged off debt. On October 8, 2020, the Seventh Circuit agreed with the CFPB’s reasoning that such a breakdown cannot be construed as forward-looking and therefore misleading. In Hopkins v. Collecto Inc, the CFPB argued the Third Circuit should follow the Seventh Circuit’s decision in Degroot.  The Hopkins case remains pending. 

Further, two cases wherein the CFPB filed amicus briefs in 2019 were decided in 2020. In Bender v. Elmore and Throop, P.C., the CFPB argued consumers are not time-barred from challenging FDCPA violations that occurred in the prior year and that the contrary reading of the statute is inconsistent with its plain language, the weight of case law, and the express purposes of the FDCPA. The Fourth Circuit agreed, holding that the FDCPA’s statute of limitations establishes a separate one-year limitations period for each discrete violation of the Act.

In Preston v. Midland Credit Management, the CFPB argued that there is no “benign language” exception to the provision of the FDCPA that prohibits debt collectors from using any language or symbol, other than the debt collector’s address, on an envelope. However, the CFPB added that the provision does permit language or symbols that facilitate making “use of the mails,” such as a USPS barcode. The Seventh Circuit agreed, holding that there is no “benign language” exception; however, section 1692f(8) does not prohibit markings required by the United States Postal Services such as stamping or affixing language or symbols to ensure the successful delivery of a communication.

insideARM Perspective

The CFPB’s report indicates the Bureau remains laser-focused on protecting consumers during the Covid-19 pandemic.  Although we may be rounding the corner and close to returning to some sense of normalcy in daily life, accounts receivable entities should exercise caution when considering the right time to remove or alter Covid-19 procedures.  Further, the 2020 CFPB enforcement actions reaffirm the CFPB’s mission to pursue accounts receivable entities for unfair practices. There is never a wrong time to review policies and procedures for efficacy and the impact on consumers, particularly those impacts which may be unintended.

SAULK VALLEY, Ill. — VeriFacts supports YWCA Sauk Valley’s efforts to provide transitional housing facilities and support services to local victims of domestic violence. Our team has already collected and delivered two truckloads of kitchen supplies, bedding, and various household items to our local YWCA and will continue to accept donations throughout the month. These donations will help fill the immediate needs of families making the transition from a shelter to safe, affordable housing in our community.

Many victims may be making the difficult choice to remain in a domestic violence situation or face the prospect of homelessness. YWCA of the Sauk Valley’s Domestic Violence Program responds to this urgent need in our community through supportive services that help women and families reunify, rebuild, and transition to permanent housing.

“Supporting our local YWCA has always been a priority for us and they need our support now, more than ever. I am so proud of our VeriFacts family,” says CEO, Stephanie Clark, “if there is a cause that needs our support, our employees step up, without hesitation, to do what they can to help! We are highly engaged and strive to deliver hope to our neighbors here in the communities where we live and work.”

Our commitment to community involvement and supporting organizations, like YWCA, is an integral part of our culture. We align with YWCA’s work to create community solutions that prevent domestic violence, empower survivors, and improve the quality of their lives by obtaining permanent housing and achieving economic security.

If you want to join VeriFacts and make a donation or volunteer with the YWCA, please visit their website for information. 

If you or someone you know is experiencing domestic violence, please call our 24/7 Hotline at 1 (888) 999-7511 to speak to a trained domestic violence counselor today or visit the YWCA website for additional information.

About YWCA of the Sauk Valley

YWCA Sauk Valley is dedicated to eliminating racism, empowering women, and promoting peace, justice, freedom, and dignity for all. The YWCA aims to positively impact lives within the community by creating a vibrant and diverse environment in which more women become independent, visible in leadership, and able to reach their full potential. Local offices are located in Sterling and Dixon, IL.

About VeriFacts, LLC

“A leading service provider to the receivables management industry for over 30 years, VeriFacts, LLC is committed to offering guaranteed customer location and employment verification services to creditors across the nation. Our brand has become synonymous with high-quality service and a positive customer experience. VeriFacts is headquartered in Sterling, IL.”

Today, we’re answering questions about Disputes, with assistance from John Bedard of Bedard Law Group, and Leslie Bender of Clark Hill.

Would it be helpful to treat all disputes as if they were FCRA disputes?

No.

Each dispute must be treated appropriately based on the content of the dispute. It is advisable for your agency to map out FDCPA and FCRA dispute strategies and the steps you take in each instance:  

FDCPA Disputes

There is not a “frivolous or irrelevant” dispute category under the FDCPA. A timely dispute under the FDCPA requires suspension of debt collection activities until debt verification is provided. However, a collection agency does not have to respond to the dispute within a set timeframe. (Just to repeat a different way: Under the FDCPA, when a consumer disputes, you must cease collection efforts. You cannot start collection efforts again until you have responded to the dispute.)

FCRA Disputes 

Under the FCRA, there is a 30-day time frame for handling disputes. There is often confusion between these different treatments of disputes. By deciding to treat all disputes as if they were FCRA disputes and documenting that strategy, you could expose yourself to risk in a number of ways: if the customer is not really disputing per the FCRA but you note a dispute on the customer’s credit file, one might argue that is inaccurate or misleading.

Frivolous dispute under CRA – What’s your recommendation?

When furnishers determine that a direct dispute is frivolous, then the furnisher should follow the Frivolous Dispute Procedures spelled out in the FCRA. (See § 611. Procedure in case of disputed accuracy [15 U.S.C. § 1681i] on page 50 of the FCRA.)

There is no such thing as a frivolous E-oscar dispute for investigation and response purposes.

The challenge with “frivolous disputes” is that people are reluctant to log in and provide personal information in a portal they are not familiar with. How do you overcome that?

Some agencies have a form letter they send, acknowledging receipt of a dispute and checkboxes requesting additional information from the consumer to enable the agency to research and respond with a time frame; and a second follow-up letter noting nothing has been received in the expected timeframe. If the agency hears nothing further from the customer within [x] days it will assume the customer resolved the dispute to their satisfaction. In addition, some agencies have dedicated dispute personnel who are noted in this two-letter series who are trained to ask probing questions to get more information.

Talk about the difference between your company’s approach to innovation vs. its approach to incremental improvement.

Unifund has several loose teams focused on different types of innovation and on improvement.  I say loose because, although each team has a core of subject matter experts and key resources, folks from other areas are often involved as the output from these teams makes its way through testing, evaluation and daily operations.  Perhaps “flexible” would be a better word than “loose”.

Innovation related to what I will call existing inventory and operations resides with a crack team of data scientists and analysts.  They work in a sandbox, much like the Innovation Council, in that ideas are floated, researched and considered without too much concern for what operational roadblocks may exist.  It is very “what if…”.  The result of this has been some very creative, economical, low cost, high ROI (and proprietary, sorry…) solutions that we believe are unique to our space.  Innovation related to what I will call new consumer approaches and account treatments resides with our VP of Marketing and Innovation who in turn is assisted by Unifund’s PMO.  These efforts are less quantitative and more qualitative in that they involve creative approaches to consumers through education, reward-type programs, and alternative ways to pay down debt.

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Incremental improvement is encouraged across the organization and all team members are encouraged to present ideas, point out issues and inefficiencies, and suggest possible solutions.  These, in turn, are brought to managers of Inventory Excellence and Process Excellence, the former focusing on movement of accounts from acquisition to selected treatment path to final disposition, the latter focusing on the nuts and bolts underneath that account movement.  Since Unifund operates on a proprietary account management system with its developers in-house, these managers and their teams are in a position to quickly resolve issues and make system improvements.  Improvement efforts are more practical in nature than innovation efforts, and understandably so.  Given that these efforts take place in live production, the atmosphere is much less of a sandbox and much more of a “building and improving the road while the cars are already driving on it” proposition.

Does a whiteboard help you to solve problems? How? What’s an example?

A whiteboard most definitely helps me solve problems.  I am a picture guy.  One of my most frequent recollections of my experience when I went back to school for a business degree was the voice in my head saying (ok, actually crying out) to the instructor, “Can you PLEASE draw me a picture of that?” 

I want to see problems and solutions visually, and a picture in my head is not enough.  A nice big space, markers of different colors, process steps outlined, SQL tables and relationships drawn out.  Leave plenty of space in between for notes, ideas and comments.

I am currently working on a project to calculate statute of limitations across account types, states, laws, issuers and other factors.  Yes, of course we have a current calculation process, but as with any number of business processes it is one we can improve and streamline.  After sitting at my desk for some time studying a grid of information provided by another team member I finally set it aside and went to my whiteboard.  The grid was clear enough, but how to build what it provided into our system?  What tables and data columns we already have to store the information became one color.  Tables and data columns we need to improve our calculation became another.  Another color became lines joining this information together and yet another became conditional statements to determine where a path should split and take an account calculation one way or another.  After this work, which took less than an hour, I was able to go back to my desk, sit down at my computer and mock up a query structure which now does exactly what I want it to do.  It is something I can pitch to our developers to clean up and implement.

What’s the most innovative decision your company has made? Tell the story behind it.

My answer to this question is not a specific innovation, but rather how we get to innovation.  In the last several years Unifund has essentially made the decision to create teams specifically charged with innovation (see my comments above about those teams).  Years ago the innovators at Unifund were also operators and managers of many production processes.  It was appropriate at the time because many of those production processes were innovations in and of themselves, were very complex to build and required the brainpower those folks possessed to construct.  As those processes evolved and became more day-to-day it became apparent that in order for innovation to continue, the day-to-day would need to be handed off and the innovation tasks housed independently.  Was this a conscious decision?  Well, maybe not.  Was it even an innovation?  Looking back on this paragraph, probably a stretch to call it that.  Perhaps it was more of an evolution, but the end result has been to better align tasks and resources appropriately and to create environments within Unifund where innovation may truly take place.

What current industry problems do you think will require the most innovative solutions?

Here’s one that keeps me up at night.  Well, not really… I generally sleep just fine.  With Virginia just having passed its own consumer privacy act and other states likely following, how operators deal with up to (worst case) fifty-one sets of privacy laws is something to consider.  How do we build something modular that can leverage where states have the same regulations and where we can easily build in new modules where a new state act produces different regulations?  Side note… as much as I am for keeping power with states and localities this is one area where a Federal act would be better for us.

Complete this question in the context of the ARM industry: What if….?

What if a consumer could click on an account from anywhere, be directed to where it currently resides (still with issuer, at agency, with debt buyer, with a law firm, etc.), be shown a flow path history of the account from issuance to current stage, and show that account in a format in which the consumer would easily recognize it as theirs?

Final thoughts…

The notes above are my own.  Recollections, perspectives and opinions of other Unifund folks may differ.  My path through the organization has taken me through many departments and roles (are they still trying to find a fit for me?) and given me a wide view.  It’s been a great ride.

—

Michael Kane has been with Unifund, a debt buyer, since 2004 where he is currently in the role of IT Manager, Inventory Excellence and Vendor Operations.

The iA Innovation Council is a collaborative working group of product, tech, strategy, and operations thought leaders at the forefront of analytics, communications, payments, and compliance technology. Group members meet in person (and lately, virtually) several times each year to engage in substantive dialogue and whiteboard sessions with the creative thinkers behind the latest innovations for the industry, the regulators who audit and establish guardrails for new technology, and educators, entrepreneurs and innovators from outside the industry who inspire different thinking. 

2021 members include:

WILMINGTON, Del. — Phillips & Cohen Associates, Ltd., the leading deceased account care and debt settlement portfolio management business servicing creditors in the US, Canada, UK, Ireland, Australia, New Zealand, Spain, Portugal, Germany, and Italy, is pleased to announce that Amy Perkins has joined its senior executive leadership team in the newly created role of Global Chief of Staff. 

Perkins is a proven leader, with several years of collections strategy and operational experience at the highest levels at NCO Group, Bank of America, and Citizens Bank.  Most recently, she served as President at insideARM, one of the industry’s premier media outlets, where she led aspects of the news, product design, operations, and marketing, as well as being the architect and driving force of the innovative and influential Women in Consumer Finance conference.  http://wcf.insidearm.com 

Adam S. Cohen, Co-Chairman/CEO commented, “These are exciting times for our organization as we look to introduce new products and enter new markets.  We are thrilled Amy has joined our global leadership team as she will play a critical role in our ongoing growth by working with all levels of PCA leadership to formulate, design, and execute the long-term vision and strategies of the global business.”   

Perkins commented “Phillips & Cohen has a long-standing reputation for being a high energy, values-based company focused on compassion and innovation.  That, combined with my experience and passion for formulating and driving strategy, made joining PCA a natural and ideal fit.  I’m looking forward to being an integral part of Phillips & Cohen’s exciting and prosperous future.”

Matthew Phillips, Co-Chairman/CEO added, “We have known Amy for years and have marveled at her impact on our industry.  We look forward to her perspective and influence at Phillips & Cohen as we enter another significant growth phase with our global operation.” 

About Phillips & Cohen Associates, Ltd.
Phillips & Cohen Associates, Ltd. is a specialty receivable management company providing customized services to creditors in a variety of unique market segments.  Phillips & Cohen Associates, Ltd is domestically headquartered in Wilmington, DE, with additional offices in Colorado and Florida as well as international offices in the UK, Canada, Spain, Germany and Australia.  For more information about Phillips & Cohen Associates visit www.phillips-cohen.com. PCA provides Equal Employment Opportunity for all individuals regardless of race, color, religion, gender, age, national origin, disability, marital status, sexual orientation, veteran status, genetic information and any other basis protected by federal, state or local laws.

Today, we’re answering questions about Itemization Dates, with assistance from John Bedard of Bedard Law Group, and Leslie Bender of Clark Hill.

At what point is the “itemization date” determined and how?

The collector may choose one of five different dates as the itemization date: the last statement date, the charge-off date, the last payment date, the judgment date, and the transaction date. This date must be chosen on or before the date on which the validation notice is sent to the consumer, and cannot be changed once chosen. (For reference, see pages 95-111 of Reg F Part II for commentary; see pages 339-340 for definitions; see -342-347 for the rule.)

The itemization date(s) do not to be provided in subsequent communications.

For administrative ease your agency may choose to create simple documentation about Reg F with some recommendations to creditors about a logical date. To illustrate: If your creditors generally place an account on the date they select as a “charge off” date per their accounting strategies, knowing and confirming this may simplify your recordkeeping and reduce consumers’ confusion – especially if post-charge off costs or interest or other activities change at “charge off.”

We believe the “date” for the itemization on the Model Validation Notice, to be the last payment date. We’ve also heard others using charge off (which means nothing to the consumer). Do you feel one is preferred over the other?

The itemization date can be one of five possible dates: the last statement date, the charge-off date, the last payment date, the judgment date, and the transaction date. The best itemization date to choose is the one for which you can obtain the most consistent, reliable, and accurate data from the creditor client (which may be different for different clients), including the actual itemization of the debt from the Itemization Date forward (interest, fees, payments and credits).

Once you know what date you and your client(s) will select as the itemization date, develop training around that for both your support folks and consumer-facing folks so they understand it and can easily apply it to customers’ unique circumstances.

(For reference on itemization dates, see pages 95-111 of Reg F Part II for commentary; see pages 339-340 for definitions; see -342-347 for the rule.)

Date of Placement is not one of our options for the itemization date, right?

Correct: placement date is not one of the five possible options for the itemization date. (Those options are: the last statement date, the charge-off date, the last payment date, the judgment date, and the transaction date.)

There may be instances where the date of placement coincides with one of the five possible options. And nothing precludes a creditor from “placing” accounts on their “charge off” date and “charge off” date is an option for the itemization date.

On March 19, 2021, the Federal Trade Commission (FTC) released its annual letter to the CFPB on Debt Collection Activities.  The letter, found in its entirety here, describes the FTC’s efforts regarding debt collection during the past year.

The FTC’s debt collection program focuses primarily on enforcement; however, the letter also describes the FTC’s public outreach and education programs. Among the actions taken to combat unfair, deceptive, and otherwise unlawful debt collection practices in 2020, the FTC:

• led Operation Corrupt Collector, a nationwide federal-state law enforcement sweep and outreach initiative targeting phantom debt collection and abusive and threatening debt collection practices;
• filed or resolved 7 cases against 39 defendants and obtained $26 million in judgments;
• brought the first federal action combatting unlawful “debt parking”;
• banned the operator of a debt collection scheme who engaged in serious and repeated violations of law from ever working in debt collection again;
• deployed educational materials to inform consumers about their rights, and educate debt collectors about their responsibilities under the FDCPA and FTC Act; and
• supplied 15,755 copies of a graphic novel on debt collection, developed for Spanish speakers to raise awareness about scams targeting the Latino community.

To highlight its actions under Operation Corrupt Collector, the FTC described actions it filed against several collections agencies, including National Landmark Logistics (National), Absolute Financial Services (Absolute), and Midwest Recovery System (Midwest).  In December 2020,  the FTC reached a settlement agreement with Midwest Recovery Systems. Just last week, National, Absolute, and certain affiliates and individuals were banned permanently from collections.

Despite its focus on enforcement, the FTC signified that its public outreach and education programs remain paramount by citing examples of its attempts to educate consumers about their rights through multiple formats. Notably, in addition to the graphic novella targeted toward the Latino community, in 2020, the FTC also created an infographic to help consumers understand their rights. According to the FTC, “The colorful, easy-to-read infographic explains how to respond to a debt collection call, where to learn more, and how to report to the FTC.”  Users downloaded the infographic 800 times in three months.  

The FTC concluded the letter by reiterating that it will continue working closely and coordinating with the CFPB on consumer protection issues relating to debt collection.