ROCKVILLE, Md. — The iA Institute and insideARM are proud to announce that Missy Meggison has joined the team in the role of General Counsel and Editor. With more than fourteen years in the industry, Missy is a seasoned receivables management professional.

Immediately prior to joining insideARM, Missy served as General Counsel and Chief Compliance Officer for the FFAM360 Alliance of Companies, a national group of affiliated companies which handles all aspects of the revenue cycle through various streams, including a collection agency, debt buyer, and separate master servicers for both performing and non-performing receivables. As FFAM360’s sole attorney, Missy was responsible for the legal functions of all companies, including compliance, litigation, general corporate matters, and contracts.  Serving in this capacity, she provided risk assessments to the board of directors and worked directly with operational leadership to develop compliant solutions to alleviate risk and meet other business objectives. During her time at FFAM360, Missy developed and implemented a robust compliance management system that included an audit/remediation program, a new regulation rollout process, a full suite of policies/procedures, and methodologies to perform complaint/litigation root cause analysis and tracking. 

Missy started her career in the courtroom; in January 2007 she was a collections litigation attorney filing lawsuits and appearing in court to collect healthcare, credit card, and auto deficiency balances. Ultimately, she was tasked with managing her firm’s Georgia office, training collectors, and working with operations to develop policies and procedures.  In 2011 her practice expanded to include pursuing second mortgage deficiency balances and managing both collections operations and collections litigation in nine states across the southeast. In 2015 she took an in-house position with a national mortgage servicer, where she was able to merge her knowledge of the collections industry with the regulatory intricacies of foreclosures, collecting deficiency balances on home loans, and servicing performing collateralized loans. 

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Originally from Florida, Missy attended the University of Central Florida and the University of Miami School of Law.  She currently resides in Atlanta, Georgia, and is licensed to practice law in both Florida and Georgia.  Outside of work, Missy is passionate about two things: the Atlanta Braves and rescuing animals. In support of the latter, she currently serves on the board of directors of PAWS Atlanta, the oldest no-kill animal shelter in the Atlanta area, where she has the opportunity to impact both human and non-human lives in the Atlanta area.

In addition to editing insideARM’s daily news and managing the Case Law Tracker, Missy will be playing a key leadership role for the Consumer Relations Consortium, an exclusive policy, legal, and compliance membership group founded by the iA Institute in 2013.

Stephanie Eidelman, CEO of The iA Institute said, “We couldn’t be more thrilled about Missy joining our team. She has a well-rounded industry background and is a smart, poised, and thoughtful professional who will be able to contribute from day one.”

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.

WEST MONROE, La. – Coast Professional, Inc. (Coast) is pleased to announce the promotion of Micah Pulliam, CPA to President, which expands his role to President/Chief Financial Officer (CFO). He began his Coast career as Vice President of Finance in 2015 and later earned a promotion to Chief Financial Officer (CFO) in 2018, at which time he became a member of the company’s Operating Board, a role he will continue to maintain as President/CFO. He has played a vital role over the last six years in managing the fiscal responsibilities of the organization. Mr. Pulliam has 12 years of experience in financial operations and executive management. 

During Mr. Pulliam’s career at Coast, the company has achieved significant financial milestones including a 353% increase in revenue, the opening of additional call centers,  office expansions, and national award recognitions including four years on Inc. Magazine’s Inc. 5000’s Fastest-Growing Private Companies in America. During his tenure, Mr. Pulliam has played an integral role in Coast’s strategic culture shift, resulting in increased employee retention and morale, as well as a number of awards touting Coast to be one of the best places to work in its industry.

In his new role as President/CFO, Mr. Pulliam will continue overseeing the fiscal responsibilities of the organization, while ensuring Coast’s compliance with its stated mission. This includes oversight of all departments, Operating Board membership, and the development of company-wide growth initiatives alongside Coast CEO, Jonathan Prince. In speaking about his new role, Mr. Pulliam states, “I am honored to take on this expanded role and excited to continue to represent the exceptional family we have built at Coast. I look forward to investing in our team and our communities through continued growth for our organization. It is an exciting time to be part of the Coast family and I am humbled to have the opportunity to help lead us through further progress and success.”

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Everett Stagg, Co-Chairman of the Shareholder Board commented on Micah’s promotion, “Micah is an exemplary leader who has the knowledge, passion and resolve to lead our company into the future. As CFO, he demonstrated significant financial acumen, budgetary precision, and a thorough understanding of economic principles leading to new company milestones. I have complete trust in Micah’s ability to steer our company and further our corporate mission. Congratulations Micah on this new chapter in your career.”

Brian Davis, Co-Chairman of the Shareholder Board added, “I want to first congratulate Micah on this incredible achievement. Micah brings to his new role as President / CFO an incredible ability to combine data-driven decisions with a perceptive intuition that creates value for the company and our employees. I’m confident in Micah’s ability to advance Coast, develop reasoned strategies, and create systems of success that further our organizational cause. He is a driver of the company’s long-term prosperity and I’m thrilled to see where he leads Coast.”

As an active member in the Ouachita Parish community, Mr. Pulliam serves in numerous civic leadership roles, including participating as a board member for both the Monroe Chamber of Commerce and the University of Louisiana Monroe Athletic Foundation. He also serves as a board member and financial director of ACTS, a part of Jesus the Good Shephard Catholic Church. In 2016, Micah was named to the Top 20 under 40 list by the Northeast Louisiana Young Professionals and the Monroe Chamber of Commerce. He and his wife, Haley, and their three boys live in Monroe, LA.

About Coast Professional, Inc.

Coast Professional, Inc. is an accounts receivable management and call center company, dedicated to respectful and ethical communication with consumers. Coast provides professional services to hundreds of campus-based colleges, universities, and government clients. Coast is a seven-time honoree on the Inc. 5000 list for America’s Fastest-Growing Private Companies provided by Inc. Magazine and in 2020, was recognized for the fifth time as one of the “Best Places to Work In Collections” by insideARM.com and Best Companies Group. Since 1976, Coast has worked closely with clients to increase recoveries by assisting consumers in resolving their financial obligations. Coast’s success is exemplified by exceptional recoveries, superior service, and dedication to the highest levels of compliance. More information about Coast can be found at www.coastprofessional.com

GENESEO, N.Y. — The employees of Coast Professional, Inc. (Coast) have been honored with the prestigious George Traber Award by the Livingston County (NY) Chamber of Commerce. The award recognizes civic engagement through leadership, philanthropy, and volunteer work. It is presented annually as part of the Chamber’s Business Excellence Awards recognizing businesses and non-profits that exemplify a commitment to the betterment of the Livingston County area. This is Coast’s second Business Excellence Award; in 2018, the company received the Chamber’s Large Business of the Year Award.

The George Traber Award is a result of the company’s dedication to supporting local communities by engaging in multiple charity efforts throughout the year. Since 2019, the women and men of Coast have raised and donated more than $300,000 for local causes. A large portion of donations is generated through an ongoing “Casual Dress for Charity” program wherein hundreds of Coast employees exchange a monthly donation for the option to wear jeans and sneakers to work. Charities are chosen by employees and have included the Ronald McDonald House, the Hope Project of WNY, the American Cancer Society, and Boys and Girls Clubs, among others. Additionally, the annual Coast Cares Education Open golf tournament has raised more than $41,000 to support underprivileged children in four Livingston County school districts. Coast also hosts a yearly First Responders Day cookout, where employees treat local police officers, firefighters, and emergency medical workers to a meal in appreciation of their dedicated service.

“Community outreach is a key component of our culture,” said Jonathan Prince, Coast Chief Executive Officer. “Our employees are our greatest strength and accepting this award on their behalf is an extraordinary honor. Coast is aligned with the Livingston County Chamber’s commitment to maintaining a community that is a world-class place to work and live. The actions of our generous employees allow us to make a positive mark on this great community every day.”  

About Coast Professional, Inc.

Coast Professional, Inc. is an accounts receivable management and call center-based company, dedicated to respectful and ethical communication with consumers. Coast provides professional call center services to hundreds of campus-based colleges, universities, and government clients. Coast is a seven-time honoree on the Inc. 5000 list for America’s Fastest-Growing Private Companies provided by Inc. Magazine and in 2020, was recognized for the fifth time as one of the “Best Places to Work In Collections” by insideARM.com and Best Companies Group. Since 1976, Coast has worked closely with clients to increase recoveries by assisting consumers in resolving their financial obligations. Coast’s success is exemplified by exceptional recoveries, superior service, and dedication to the highest levels of compliance. More information about Coast can be found at www.coastprofessional.com.

Yesterday the Senate Banking Committee held its confirmation hearing for Rohit Chopra, nominated to be Director of the Consumer Financial Protection Bureau, and Gary Gensler, nominated to be Chairman of the Securities and Exchange Commission. In the 3+ hour hearing, there was no mention of the CFPB’s debt collection rule, however, there were a few interesting exchanges, and they weren’t all related to questioning of Chopra.

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Sen. Thom Tillis (R-NC) raised to Gensler the long-overdue need to advance the electronic delivery of documents. Gensler then referred to his experience with establishing the e-signature under the Clinton Administration. Here’s the 1-minute exchange.

Sen. John Neely Kennedy (R-LA) began questioning the CFPB nominee by pronouncing his name “Shop-ra” and asking whether that was correct. Chopra provided the correct pronunciation. Kennedy proceeded to use his own pronunciation. His bailiwick was the credit bureaus.

Sen. Tina Smith (D-MN) asked Chopra about student loan servicing and how he would approach oversight to ensure borrowers access to forgiveness and income-based repayment programs. He suggested that he sees many of the same conditions developing in the student loan environment that developed in the mortgage market prior to the last financial crisis. Here’s the 3-minute exchange.

Sen. Tim Scott (R-SC), a former insurance agency owner, challenged Chopra to agree that it’s only fair that regulated entities know the rules of the road before being charged with breaking them. Here’s the 2-min. exchange. 

Both Sen. Pat Toomey (R-PA) and Sen. Thom Tillis (R-NC) asked Chopra about the role of supervisory guidance and its potential to create uncertainty in the market. Chopra affirmed that guidance is to be used to provide supervised entities with clarification. Here’s the 1-minute exchange with Tillis.

Finally, Sen. Steve Daines (R-MT) posed a blunt question to Chopra, “Is business a harmful force?” Chopra’s response:

“Senator, there is no one more than me who thinks that business is one of the best forces for our lives in America.” – Rohit Chopra

Here’s the less than 3-minute exchange.

Based on how the hearing went, I’d be surprised if both nominees were not approved by the Committee and sent to the full Senate for confirmation.

Rebekah Johnson, CEO, and Anis Jaffer, Chief Product Officer of Numeracle host a live Q&A podcast series covering all things related to call center communications, including call delivery, STIR/SHAKEN, caller ID technology, TRACED Act, brand identity, and more. In the episode below (transcript edited by insideARM; listen to the full episode here), they debunk myths surrounding the June 30th, 2021 STIR/SHAKEN deadline as per the TRACED Act.

What does the TRACED Act actually require?

Rebekah: We keep hearing people talk about June 2021 as though that’s the next thing that’s going to be a cliff, and all communications fall off at that point. I can understand why people think that, but anytime we’re trying to understand what a deadline is I think it’s important to go back to where this date even came from and look at the words around it. 

I’m going to read specifically from the TRACED Act. For those who don’t know this was signed at the end of December 2019, and it covered the implementation of an authentication framework. So specifically where this June 2021 came from was the TRACED Act basically saying that ‘no later than 18 months after the date of the enactment of the act the commission’ (which is the FCC) ‘shall require a provider of voice service to implement the STIR/SHAKEN authentication framework in the Internet Protocol networks of the provider of voice and B) to require a provider a voice service to take reasonable measures to implement the effective call authentication framework in the non-Internet Protocol networks of the provider of the voice service.’

So the FCC has been very busy passing a lot of rules around this. The TRACED Act specifically said that the commission shall require a provider of voice service to implement the STIR/SHAKEN framework in its IP networks. The key thing here is that when it comes to the implementation, STIR/SHAKEN has been around for a while. This is a standard that the carriers have been working on for quite some time, it’s just unfortunate that it gets to the point that there has to be a mandate. So that’s what we’re facing: the carriers were very busy implementing the standard but it just wasn’t progressing at the rate that the commission would like to see.

So when we look at what the FCC actually said about this deadline, we have to look at the first report and order that was put out in March 2020. Basically, the FCC adopted the first order mandating that, “originating and terminating voice service providers implement STIR/SHAKEN in the IP portions of their networks by June 30th, 2021.” What’s interesting is what’s not said. What’s not said here is, what about the interconnect? What about the non-IP portions of the network?

So we can debunk all of the statements with regards to, “your calls are going to stop come June 2021 if they’re not signed.” That is not what is being said here. In fact, the FCC went so far as to make some statements about not being prescriptive of what you do once you implement STIR/SHAKEN; that’s going to be on the terminating side to make their decisions about what is best.

They haven’t told terminating carriers to block calls that don’t have an A-Level Attestation. It’s just a line in the sand to say, ‘we need you guys to implement on the originating and terminating side for the IP portions, STIR/SHAKEN. And if you can’t meet those deadlines, you have to let us know so we can work out some exceptions for you.’

What exactly is STIR/SHAKEN?

Anis: I also want to chime in with respect to the non-IP service providers. The BASE STIR/SHAKEN Standard is targeted at internet IP-based service providers. The non-IP providers are not going to be implementing. Obviously, you need to have a SIP infrastructure (Session Initiation Protocol) to add the search, traditional TDM basic infrastructure will not be able to do it.

What do we mean by STIR/SHAKEN Standard, or the BASE STIR/SHAKEN? SHAKEN itself is a framework that’s built on the idea of STIR protocol. It allows or provides an end-to-end architecture for originating service providers to verify and attest who is originating the call and then a terminating service provider to validate that.

So when an originating service provider or carrier knows the customer and they also know where the customer got the number from, or have a way to verify where they got the number from, then they can add a certificate to the SIP invite attesting that they have a way to verify the customer as well as the number. That essentially is the telephone identity that gets attached to the SIP invite and it gets transported over the SIP network to the terminating service provider who does the reverse. So they get the certificate and then they validate if that certificate is valid, has been signed by the relevant key that has been attested, and then they can choose how to terminate the call. That essentially is what is known as the STIR/SHAKEN Standard, which is the BASE STIR/SHAKEN that needs to be implemented by carriers and service providers by June 2021.

What is ‘Attestation’ and how does it work?

Anis: One of the key things on the certificate is called the Attestation Level. When the originating service provider signs the call they attest it with one of three different levels: A, B, or C. When the service provider knows the customer and also knows how the customer got the number, either they issued it or they’re able to verify that the customer has the right to use that number, then they can sign the call as A. There’s also another component to it that they are actually originating the call.

So let’s say, for example, Verizon is the service provider and they are servicing a big-box retailer, and if the big-box retailer got the numbers from Verizon and are also using the SIP trunking from Verizon to originate the call, Verizon has all the information that they need to attest the call with A-Level.

In case Verizon doesn’t know that the big-box retailer has the right to use the number or if the big-box retailer is using a third-party call center and that call center is originating the call and Verizon does not know if they have the right to use the number, then they have to sign the call with Attestation Level B.

Let’s say the same call originates from outside the country coming through an international gateway and Verizon doesn’t have any way to know who the originator of the call is, the only thing they know is that the call came through their network and is being placed into their communication network, then they would sign it as Attestation Level C.

So those are the three authentication — or Attestation — levels. The gap is the scenario that we talked about for Attestation B. Let’s say you have a call center or BPO and they’re making calls on behalf of multiple clients. We also know that in some cases there could be two or three parties involved during the call path. So you could have the end client be somebody who is not even making the call, but they have outsourced this call to another call center who is then using a different platform or a CPaaS provider (Communications Platform as a Service), and they got the numbers from one provider, and they’re using another network to make the call… These are all the scenarios that are happening in the ecosystem and that is the gap that we have. You would hear: Attestation Gap, enterprises not being able to validate or service providers not being able to validate the enterprises, that’s the scenario that we are seeing where enterprises cannot directly get their call signed.

So, what does this mean for enterprise calls?

Rebekah: Anis, what are you seeing with regards to how the carriers are going to take this data in? Let’s say we’ve got the ecosystem set up, everybody’s good. The FCC’s got their list of voice service providers that are implemented, we love what we see, 90% implemented, go. What are they going to do with this information?

Anis: We think what will happen is, if you are a cell phone subscriber directly calling using a telephone carrier, like Verizon or AT&T, your calls will probably get signed. Because they know who you are and they issued the number it’s a straight A-Level Attestation. That will happen. For the complex enterprise scenarios where there are multiple vendors and different parties involved in the call path, those would probably not be signed with Attestation Level-A.

That doesn’t mean that calls are not going to get terminated, because the terminating service provider still has a choice to terminate the call. They would also use the analytics providers, just like we have today, for call validation treatment. Analytics would continue to run and using their algorithms would determine if that call is spoofed or spam and they would label accordingly. I don’t think it’s going to drop off come July. It’s probably going to change over a period of time but not immediately. So you would still continue to have calls with different labels that get terminated, but you would also start seeing more and more verified calls, especially subscriber-to-subscriber calls, with Attestation A. Over a period of time, I think enterprise calls would change as more service providers implement.

What are the top three things businesses need to be aware of and should do by June 2021 to be prepared for STIR/SHAKEN?

Rebekah Johnson: This is a bulleted list; top three, not in any particular order.

One, you need to know what your service provider is doing, whether your service provider is the BPO, the CPaaS, UCaaS, or direct carrier, you need to know what they’re doing to prepare for June 2021. They should either tell you, ‘we filed for an extension,” or ‘we’re going to meet the timeline.’ If their answer is, ‘what is STIR/SHAKEN?’ you’ve got some concerns, they should not be responding that way. So get an assessment of where your service provider is.

Two, ask your service provider how their compliance with the law is going to impact your current contract. This is a new one, this is the first time anyone is talking about this but I’m bringing it up because I’m starting to see that with STIR/SHAKEN some are shifting the contracts on the originating side. I’m seeing it come through in a variety of different ways, whether it’s an increase in cost, a service-level agreement change, etc. Start having that conversation with your provider. If there is going to be a contractual impact on the services that they provide based on STIR/SHAKEN, then you might consider hiring an attorney to help you through those problems. I think there are going to be some things where we need to get a better understanding.

Third, analytics are going to continue to exist. Anis has covered that the carriers and their CVTs, their analytics providers is what they’re called, will continue. They have to. They have to stay in existence to determine calls that are wanted, unwanted, illegal, whatever it may be, they’re going to be around. So you still have to address your call blocking and labeling issues. Just think of STIR/SHAKEN as another data element for that decision making on the terminating side.

So those are the top three things that I would focus on. Number four is going to be who’s on the list and not on the list. That might be a shopping list for us in the future of who do we work with and not work with? 

HOUSTON, Texas – LTD Financial Services, L.P., a full-service accounts receivable management and business process outsourcing company, is pleased to announce that LuJuana DeFrance has joined the company as Director of Client Relationship Management. As a CEO direct report, she will continue to expand LTD’s “Client First” philosophy and serve as a strategic point of contact for LTD clients by creating an effective process and information flow between client services, operations, data operations, and other disciplines. Her responsibilities include effective project management; onboarding new clients, projects, and services; and ensuring customer success with accurate current reporting and attentive quality service for client satisfaction while building value-driven tenured client partnerships for the organization.

“Based on an aggressive growth plan that includes expanding our domestic and nearshore footprint, LTD will leverage LuJuana’s expertise to support our BPO, Collections, and current traditional third party Recovery services,” said David John, CEO. “In addition, her in-depth understanding of client expectations for success will guide LTD’s strategic client focus initiatives for an exponential growth forecast in 2021.”

LuJuana is a long-term ARM/CRM industry professional with vendor management experience for the entire account lifecycle on behalf of prestigious Fortune 500 leaders in the banking, credit card, consumer finance auto (captive and non-captive lenders), student loan, fintech, entertainment, and internet industries for clients such as Ally Financial, America First Finance, Bank of America, BBVA Compass, Freedom Financial, Harley-Davidson, Honda, Hyundai, Navient, Nissan, and PayPal, among others. Her previous roles positioned her to build a “Client First” quality service platform with an emphasis on customer success, quality, accountability, innovation, and teamwork. Most recently, she served as the Project Launch Manager for first party, third party, and various BPO projects domestic and nearshore at Constar Financial and Constar International, and prior to that, as the Client Services Manager at Constar building an industry-recognized full-service quality client success service team.

For more information, contact LuJuana DeFrance via email at lujuana.defrance@ltdfin.com.

About LTD Financial Services, L.P.

Established in 1993, LTD Financial Services, L.P. is a nationally recognized provider of ARM and BPO services. LTD’s solutions consistently deliver quality customer experiences and superior financial results for our clients through leading technology, omni-channel communications, and data-driven decisions in a fully compliant, customer-centric culture. Our approach places our clients first in every aspect of our relationship including Customer Solutions, Care, Collections, Recovery, Compliance, Controls, Communication, and Accountability.

GENESEO, N.Y. – Coast Professional, Inc. (Coast) is excited to announce the promotion of Jonathan Prince to Chief Executive Officer (CEO). Mr. Prince exhibits more than 20 years of experience managing high-performing teams and has demonstrated his proficiency in leadership, business strategy, and organizational development.

He began his career at Coast as the Director of Operations and steadily acquired more responsibility until earning a promotion to Vice President. He subsequently earned a promotion to Chief Operating Officer (COO) in 2018, as well as a role on the Company’s Operating Board, which he will continue to maintain as CEO. Mr. Prince has been instrumental in the growth of the company from the inception of its first federal government contract. At the time of Mr. Prince’s promotion to COO in 2018, Coast employed approximately 300 individuals. Coast currently employs over 800 staff members and expects to exceed 1,000 by the end of 2021. 

During his tenure, Coast has achieved significant company milestones including the award of multiple federal government contracts, office expansions, career growth, and national award recognitions while continuing to increase revenue and brand recognition. Mr. Prince has been directly responsible for the company’s continued success working with major federal government clients and the strategic efforts to expand service offerings to new business verticals. He was most recently a driving force behind the company’s entry into Contact Tracing and call center work.  

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In his new role, Mr. Prince will be responsible for the company’s overall success and strategic vision, as well as the development and execution of the company’s short and long-term growth plans. This includes oversight of all departments, Operating Board membership, and the development of company-wide growth initiatives. He will continue his responsibilities as a key personnel member for major clients and as an authorized company representative.  

Mr. Prince stated, “I’m humbled to receive this promotion and honored to continue representing our exceptional family of employees. We have an incredible team that is ready to develop new opportunities and create value for our clients, consumers, and our communities. Our success will be the continuation of our shared vision and our never-ending commitment to doing the right thing.” 

Mr. Prince is an active member of the Western N.Y. community and participates as a board member for the Livingston County Area Chamber of Commerce and Tourism. His dedication to the community is evident in both his personal and professional life, which is emphasized in Coast’s charitable efforts. Mr. Prince has a passion for renewing education opportunities for children and was the leader behind the company’s Coast Cares Education Open golf tournament which raised over $40,000 for local school districts in 2019. He and his wife, Jennifer, and their two children live in Groveland, N.Y. 

Brian Davis, Co-Chairman of the Shareholder’s Board commented, “Jon is an exceptional leader. He continues to be instrumental in our success and brings with him a wealth of experience in his new role as CEO. He possesses exceptional character, careful judgment, and the unshakable integrity necessary to lead our company into the future. Jon genuinely embodies our core values and has an unwavering commitment to our success. Congratulations Jon on this incredible career achievement.” 

Everett Stagg, President and Co-Chairman of the Shareholder’s Board added, “Jon is the catalyst for the company’s next chapter. His achievements have continually demonstrated his ability and strength as a leader, resulting in significant company milestones. The Shareholder’s Board is honored to promote Jon into his new role and support his endeavor to further our company’s reach. This is well-earned recognition for his continued success, and I want to personally congratulate Jon.” 

About Coast Professional, Inc.

Coast Professional, Inc. is an accounts receivable management and call center company, dedicated to respectful and ethical communication with consumers. Coast provides professional services to hundreds of campus-based colleges, universities, and government clients. Coast is a seven-time honoree on the Inc. 5000 list for America’s Fastest-Growing Private Companies provided by Inc. Magazine and in 2020, was recognized for the fifth time as one of the “Best Places to Work In Collections” by insideARM.com and Best Companies Group. Since 1976, Coast has worked closely with clients to increase recoveries by assisting consumers in resolving their financial obligations. Coast’s success is exemplified by exceptional recoveries, superior service, and dedication to the highest levels of compliance. More information about Coast can be found at www.coastprofessional.com. 

“Tactics is knowing what to do when there is something to do; strategy is knowing what to do when there is nothing to do.” – Savielly Tartakower.

Savielly Tartakower is considered to be one of the most notable personalities ever to play the game of chess. He was among the first to be awarded the title of International Grandmaster back in 1950. Among his most well-known sayings was the one above that has excellent application to success in today’s modern business world.

Many of those in the accounts receivable management industry today find themselves looking to deploy the right tactics to respond to several seismic shifts that have occurred in recent months: the deployment of remote workforces in response to the COVID-19 pandemic, responding to the Consumer Financial Protection Bureau’s debt collection rule and whether new leadership atop the Bureau will alter what has already been released, and rapid advancements in technology that are revamping how collection agencies operate. Each of these situations requires companies to make substantial, business-critical decisions that will likely affect their future. 

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Developing a strategy during a period of uncertainty can feel like trying to hit a moving target. You don’t want to waste time building a plan only to have it change as soon as you launch it. But the longer you wait for the clouds to part and an exact direction to be laid out before you, the longer you live in limbo, and that is just not a viable option for a company of any size at this time in our history. Like in a chess match, decisions have to be made, and pieces have to be moved before time runs out, ideally planned out well in advance yet able to respond to changing dynamics. Not making a move results in time running out and you losing the game. 

Responding to Covid

The extended impact of the COVID-19 pandemic is that employees will work from home for a long time. The latest numbers show that it will take at least eleven months to get the United States to the level of herd immunity. Humanity will take closer to seven years to get to the same level. Seeing numbers like this it is easy to believe things will never go back to the way they used to be. Companies did a great job of pivoting a year ago to be able to support employees working from home, but the expectation was that this would be a short-term blip on the radar. The reality is that this is not going to be a blip. People will be working remotely for years to come, if not for decades. 

Today we should be developing business plans that incorporate the remote work dynamic and making decisions that reflect those changes, such as:

• The need for new policies and procedures to cover remote workers
• Dramatically reducing office space
• Hiring and training
• Equipment returns 
• The impact on company culture 

Not working on these now is the equivalent of letting your competition have multiple moves. Done right, organizations will be able to reduce their costs, build in flexibility, increase productivity, resulting in increased profits that can be fed back into the decisioning cycle, increasing the profit gap between you and your competitors. Taken to an extreme an organization that increases efficiency enough could decide to reduce their fees, gain market share, and still be as or more profitable. 

Checkmate!

The CFPB’s Debt Collection Rule

Like in chess, companies can’t make one move at a time in a vacuum. Moves need to be thought out in advance and made in a coordinated fashion if they are to be effective.

Planning ahead is exactly how companies should be addressing compliance with the CFPB’s debt collection rule. There may be more than nine months before the rule’s provisions are scheduled to go into effect and there are legitimate concerns that the new leadership of the agency may choose not to move forward with the rule’s release or make changes to the rule before it goes into effect. Taking a wait-and-see approach may feel like the right move, but there are so many changes to be made that waiting too long may make it impossible to get them all done in time. If a company needs to work with a software provider or technology vendor to make changes to their processes, those companies may need to get in a long line. We may already be running short on time and the time for action is upon us. 

Here is what we know, the new CFPB has set the minimum requirements that need to be in place by November 30, 2021. What is your plan to ingest, digest, and implement these requirements? Good program management is crucial and starts with gathering the list of requirements. Next come timelines, resources, organization buy-in, and focused action with measurable results. We are not done.

Once we get all these things done we need to prepare for alternative regulatory changes. Worst case scenario planning is a great place to start. Get the team together to figure out how would your organization handle call caps of three a week, needing email consent given directly to the agency, Bill of Rights notices in every communication with the consumer, and substantiation requirements prior to reaching out a consumer to name a few. This makes you want to give up the game altogether. Knowing how you can respond to each of these gives you moves others will not be able to think of if they are thinking of them for the first time. 

Check!

The Impact of Technology

Being too late to the party is something that is going to happen to many collection agencies when it comes to the rapid technological advancements that are being made in the industry today. Companies that have been too reluctant to consider technologies like text messaging, voicemail drops, machine learning, speech analytics, and data analysis are giving their competitors a huge — and unnecessary — competitive advantage. Waiting for things to go back to the way they were is as bad an idea here as if you ignore remote workforces and complying with the CFPB’s rule. This calls to mind another quote from Tartakower: “The move is there, but you must see it.”

The impact that technology is having on the ARM industry should not come as a surprise to anyone. It has been clear for years that technology was going to become the engine that drives efficiency and productivity for the industry for the next generation and the generation after that. 

How many companies do you know that were successful that never made a move or were slow to move (also known as sat back and took a wait-and-see approach)? To improve is to change, but to perfect is to change often. Today’s leaders need to build plans but be ready to change them at a moment’s notice and take action. Just as in chess, when you see an opportunity, you have to act fast. If your opponent leaves his or her queen exposed, you go for it. Not taking the piece could mean the difference between winning and losing. Don’t become a cautionary tale. 

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:

The term “early out entity” is generally defined as a third party that performs business office services (“extended office services” or “EBO services”) on behalf of hospitals and other medical service providers on non-delinquent patient accounts.  An early out entity receives the accounts for servicing from the hospital or medical service provider prior to the accounts being in default and does not perform collection services on accounts deemed to be in default.  The early out entity typically services the accounts in the name of the hospital or medical service provider. Based on a plain reading of the above law, Texas likely prohibits early out entities from engaging in EBO services in the name of the hospital or medical service provider.  Read on to learn why.

Early Out Entities are Likely Considered Debt Collectors Under the Texas Finance Code

The Texas Debt Collection Act (“TDCA”) distinguishes between a “creditor”, “debt collector” and “third party debt collector.”  Tex. Fin. Code § 392.001(3), (6) and (7).   The TDCA defines a “creditor” as a “party, other than a consumer, to a transaction or alleged transaction involving one or more consumers.  Id. at (3).  A “debt collector” is a “person who directly or indirectly engages in debt collection . . . .”  Id. at (6). “‘Debt collection”, in turn, means an action, conduct or practice in collecting, or soliciting for collection, consumer debts that are due or alleged to be due a creditor.”  Id. at (5).  There is no qualification that the consumer debt must be in default or delinquent. 

Significantly, Texas considers both debt collectors and creditors to be “debt collectors” for the purposes of the TDCA.  Boles v. Moss Codilis, LLP, Civil Action No.  SA-10-CV-1003-XR, 2011 WL 2618791, at *4 (W.D. Tex. Jul. 1, 2011) (noting that “the TDCA’s definition of a debt collector is broader than that under the FDCPA, and includes creditors seeking to collect debts originated by them”).

On the other hand, a “third party debt collector” is defined in the TDCA by reference to the definition of “debt collector” under the FDPCA.  Id. at (7).  The FDCPA’s definition of “debt collector” excludes any person who collects or attempts to collect debt that “was not in default at the time it was obtained by such person.”  15 U.S.C. § 1692a(6)(F).  Thus, because most early out entities are not “debt collectors” as that term is defined under the FDCPA, they are likely not “third party debt collectors” under Texas law.   

Based on the foregoing, most early out entities meet the definition of “debt collector” under Texas law and are subject to the requirements in Title 5 of the Texas Finance Code (“Protection of Consumers of Financial Services”).

Prohibited Practices under the Texas Finance Code  

Texas Finance Code § 392.304(a)(1) provides as follows:

Except as otherwise provided by this section, in debt collection or obtaining information concerning a consumer, a debt collector may not use a fraudulent, deceptive, or misleading representation that employs the following practices:

(1)  using a name other than the:

(A) true business or professional name or the true personal or legal name of the debt collector while engaged in debt collection; or

(B) name appearing on the face of the credit card while engaged in the collection of a credit card debt.

***

(4) failing to disclose clearly in any communication with the debtor the name of the person to whom the debt has been assigned or is owed when making a demand for money;

***

(6) using a written communication that fails to indicate clearly the name of the debt collector and the debt collector’s street address or post office box and telephone number if the written notice refers to a delinquent consumer debt;

(7) using a written communication that demands a response to a place other than the debt collector’s or creditor’s street address or post office box…

What This Means for Early Out Entities

Based on a plain reading of the above law, Texas likely prohibits early out entities from engaging in EBO services in the name of the hospital or medical service provider.  This creates a challenge for early out entities regarding having to advise a patient that a communication is from a debt collector, while not misleading the patient to believe that the account has been placed with a collection agency.

There is limited guidance from case law and state regulators regarding how best to comply with the Texas requirements while also minimizing confusion for patients.  With the expected increase in scrutiny against the financial services industry under the new administration, I recommend that early out entities confer with an attorney before conducting EBO services in Texas.[1]

[1] There are several other states with laws to the same effect as Texas.

The Senate Committee on Banking, Housing, and Urban Affairs will conduct a remote hearing tomorrow on the nomination of Federal Trade Commission (FTC) Commissioner Rohit Chopra to be Director of the Bureau of Consumer Financial Protection. The hearing, which begins at 10:00 AM ET, will be live-streamed and available here. Chopra’s hearing will be second, following Gary Gensler’s, to be Chair of the Securities and Exchange Commission.

Chopra previously served at the CFPB as the Student Loan Ombudsman, during which he was critical of schools, banks, and servicers in their handling of loans and lack of transparency with borrowers.  

In November 2020, Chopra issued a statement regarding the FTC’s enforcement action against debt collector Midwest Recovery Systems including these highlights:

• The FTC’s go-it-alone debt collection enforcement strategy frequently leads to outcomes where victims receive only a minuscule percentage of their losses – or even nothing at all. 
• To best serve the public and stop debt collection abuses, the FTC should work in concert with the Consumer Financial Protection Bureau. Joint actions will help make victims whole through access to the CFPB’s Civil Penalty Fund and reduce duplicative efforts. 
• As Commissioners, we must stop ignoring Congress and must recalibrate agency priorities and strategies in the financial services arena. 

insideARM previously published additional information about Chopra’s position on debt collection.

When then-President-elect Biden nominated Chopra, Competitive Enterprise Institute Senior Fellow John Berlau commented,

“The CFPB has massive power over community banks, credit unions, and small businesses that extend any form of credit. It also still lacks accountability to Congress, as it receives funding not from the appropriations process, but automatically from the Federal Reserve. Therefore, it is incumbent on the Senate to thoroughly question Rohit Chopra, President-Elect Biden’s expected nominee for CFPB director, on his views on consumer choice, financial privacy, and regulation through a fair process rather than arbitrarily by enforcement.

“During the tenure of the CFPB Director Richard Cordray, under whom Chopra served, lawmakers of both parties expressed concern about CFPB mandates on community banks and credit unions. The U.S Court of Appeals for the District of Columbia also ruled unanimously in PHH v. CFPB (2016) that the CFPB’s retroactive application of its new interpretation of a law violated the Constitution’s guarantee of due process and flunked ‘Rule of Law, 101.’ The Senate must grill Chopra to help ensure the CFPB does not revert back to these policies procedures of the Corday era that received bipartisan condemnation.” 

A Washington Post article in January included this comment from Ed Mierzwinski, senior director of the U.S. Public Interest Research Group’s federal consumer program,

“When you’re only going after last-dollar scammers and small, fly-by-night companies, you’re not sending a message to the big banks, big debt collectors, and big credit bureaus that there’s a sheriff in town. As soon as he’s confirmed, Rohit will bring a renewed sense of urgency.”