Rochester, N.Y. — Continental Service Group, LLC d/b/a ConServe, in conjunction with the company’s “Matching Gift Program”, donated its May ConServe Cares proceeds to the Willow Domestic Violence Center.  The ConServe team is dedicated to supporting various local non-profit organizations that aim to make a positive impact. Their employees’ kindness and generosity have touched countless lives in the community, making a significant difference.

“Each year, Willow supports more than 8,000 survivors in our community with life-changing programs and services.  This work would not be possible without our community partners like ConServe.  We are thrilled and grateful to be ConServe Cares’ May partner – their contribution supports Willow so we can further support survivors in Rochester and beyond,” said Nicole Morelle, Willow’s VP of Community Engagement.

George Huyler, Vice President of Human Resources, emphasizes that “ConServe’s primary objective is to cultivate positive relationships within the community. Donating to organizations such as Willow is one way that employees can make a difference in the lives of those in need, while also demonstrating their commitment to creating a positive impact in their communities.”

About ConServe

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

About the Willow

Founded in 1979, Willow Domestic Violence Center is the only New York State-certified provider of residential domestic violence services in Monroe County. Willow has supported survivors of abuse for over 40 years, reaching nearly 15,000 people each year in the Greater Rochester region. Willow provides a full continuum of free and confidential services, without judgment, including a 24/7 Hotline, emergency shelter, counseling, mobile advocacy, legal services, court accompaniment, preventive education and training programs. Call 585-222-SAFE (7233) or text 585-348-SAFE (7233).

Once a dispute is resolved, it’s resolved, at least according to a court in the Northern District of Illinois. In a recent victory for debt collectors, a consumer alleged that a debt buyer should have known about a previously resolved dispute and thus violated the Fair Debt Collection Practices Act (FDCPA) by reporting the debt to the credit bureaus without reflecting said dispute. In the court’s eyes, however, since the consumer never conveyed the dispute to the debt buyer, reporting the debt without it did not violate the FDCPA.

In Wood v. Security Credit Services (Case No: 2020-CV- 02369, N.D. Ill. 2023), the consumer disputed the debt with the original creditor. The original creditor determined the debt to be valid and informed the consumer about the results of its investigation. Using the Metro 2 Format, the original creditor reported the account with an XH code stating that the debt was previously disputed and that the debt collector had completed its investigation. The original creditor did report any other Metro 2 code with respect to the debt, including “XB,” which signifies that a consumer disputes the debt, or “XC,” which reflects that the creditor completed its investigation of a consumer’s dispute, but the consumer disagrees with the results.

Security Credit Services (SCS) subsequently purchased the account and reported it to the credit bureaus. The consumer filed an FDCPA suit against SCS, alleging that he still disputed the account thus SCS had not properly reported the debt. Upon receipt of the FDCPA lawsuit, SCS reported the debt using XB to signify the consumer disputed it. SCS moved for summary judgment, arguing that after the consumer failed to respond to the original creditor’s validation letter, the debt was no longer disputed under the FDCPA.

The court agreed with SCS and ruled in its favor. The deciding factor in the case was that the consumer did not continue disputing the debt after it was validated. In the court’s view, the debt collector could not be expected to know that the consumer still disputed the debt when the consumer did not respond to the original creditor’s validation of the debt. The court explicitly stated, “when a debt collector investigates a dispute and communicates the results to the consumer, the dispute is resolved unless the consumer indicates that it disagrees with the results.”  

Read the full case here

insideARM Perspective: 

This ruling should be viewed as a significant win for debt collectors. It puts the burden on the consumer to show that a debt collector is aware of their ongoing dispute and makes it the consumer’s responsibility to continue disputing a validated debt. If the consumer fails to do so, the debt collector is not obligated to report it as disputed. 

This ruling provides clarity on reporting standards and offers protection to debt collectors who accurately report on debts and comply with requirements. While debt collectors should remain thorough in their investigations and conservative in their interpretation of a consumer’s dispute, this ruling should have them feeling confident in situations where the consumer did not continue to dispute a validated debt. 

ARLINGTON, Va. — Convoke Pulse is a solution to manage recovery of post charge-off balances.  Integrate and consolidate data from all first- and third-party systems for a complete and accurate view of each account.  Balance and cost data is automatically updated, granular, and easy to access.  Convoke Pulse ensures you have up-to-date and accurate information on balances and costs to manage both performance and compliance.

Convoke Pulse enables general ledger accounting functionality and can serve as your system of record.  The new Account Detail Hub provides a central location for all account-level data. It is fully configurable and customizable, enabling regulatory oversight, analytics, and integration with other systems.  Like other Convoke products, Convoke Pulse is built with security in mind on Convoke’s trusted, independently audited architecture, with no data stored in the public cloud.

“Convoke Pulse represents a major step forward in our product suite,” said David Pauken, CEO of Convoke. “We aim to support credit issuers with the entire collection and recovery process, and the ability to integrate and track balance and cost data is critical for our customers. The development of Convoke Pulse will also enable more innovative products in the months and years ahead.”    

Convoke Pulse builds on the 2022 launch of Convoke Freeform: a flexible, secure, and easy-to-use collaboration platform.  Convoke will continue to develop and expand the product suite to address both the business needs and regulatory requirements of credit issuers.  

About Convoke

Convoke provides modern recovery solutions for credit issuers to support the debt collection process. The Convoke team provides industry-leading SaaS support to customers, leveraging 12+ years of industry experience. With its innovative and versatile products, Convoke enables creditors to increase recovery rates, reduce the burden of third-party oversight, and ensure regulatory compliance. Convoke is headquartered in Arlington, VA. For more information on Convoke, please visit www.convokesystems.com. 

NEW YORK, N.Y. — Skit.ai, the leading Conversational Voice AI solution in the Account Receivable Management (ARM) industry, has announced a strategic partnership with SameDay Auto Finance, LLC., a Texas-based company that provides simple, quality service for their dealers and helps customers with auto finance needs. This collaboration has enabled them to modernize their collection processes by deploying Skit.ai’s Augmented Voice Intelligence Platform, which has accelerated their revenue recovery efforts. 


The solution allowed them to address concerns in reaching delinquent accounts and bridging the gap between output and agent scarcity by scaling their operations, broadening their outreach capabilities, and launching 24/7 campaigns. They have successfully dialed over 100,000 calls via the Voice AI solution achieving a Right Party Contact (RPC) rate of 36%, enabling them to offer their customers the convenience of making payments on their terms. This approach has led to a Promise-to-Pay rate of over 4%, demonstrating the platform’s capacity to find and engage with the right customers and convert these interactions into firm commitments to fulfill payment obligations.

Commenting on the partnership’s success Russell Warden, CEO of SameDay Auto Finance LLC. stated, “We’ve been able to drive actionable insights and optimize our collections process with this robust solution, Which has enabled us to engage with our customers at the right time, with the right message, simplifying the repayment process. Most notably, we’ve seen an increase in on-call collections and payments, which showcases our customers’ acceptance of engaging with Conversational Voice AI in resolving their debt”.

 
”Since integrating Skit.ai’s Augmented Voice Intelligence Platform, we’ve seen significant improvements in our revenue recovery and customer experience. It has consistently enabled compliant communications with delinquent customers, irrespective of agent availability, and has scaled our outbound call volume,” Warden further added.

Skit.ai’s platform can enable agencies in the ARM industry to reach millions of customers efficiently and effectively. The solution is compliant, configurable, easy to deploy, and has the capabilities to navigate and resolve the nuanced challenges faced at the point of debt resolution as experienced by agencies like SameDay Auto Finance LLC. 

“Our solution successfully managed over 100,000 calls with a remarkable engagement rate of over 50%. This enabled SameDay Auto Finance to promptly address concerns related to connectivity rates with delinquent customers and staffing challenges. The partnership serves as a testament to our impact on the customer experience within the ARM industry and our team’s adeptness in solving complex challenges and delivering tailored solutions.” Stated Sourabh Gupta, Founder and CEO of Skit.ai.

About SameDay Auto Finance, LLC:

SameDay Auto Finance is a Limited Liability Company as registered with the Office of the Secretary of State in Texas as well as the Office of the Consumer Credit Commissioner. SameDay Auto Finance founders bring over 100 years of combined experience in the area of Finance.The goal at SameDay Auto Finance is simple, quality service for our dealers and helping customers with their auto finance needs.  https://samedayauto.net 

About Skit.ai: 

Skit.ai is the leading Conversational Voice AI company in the ARM industry, enabling collection agencies to streamline and accelerate revenue recovery. Skit.ai’s Compliant, Configurable, and Easy-to-deploy solution enables enterprises to automate nearly one million weekly consumer conversations. Skit.ai has been awarded several awards & recognitions, including Disruptive Technology of the Year 2022 by CCW; Stevie Bronze Winner 2022 by The International Business Awards; Gold Globee CEO Awards 2022. Skit.ai is headquartered in New York City, NY.  https://Skit.ai

To learn more about how Skit.ai’s has modernized debt collection processes of SameDay Auto Finance book a meeting and speak to an expert at Skit.ai

On June 8, 2023, the CFPB announced that it had entered into a consent order with Phoenix Financial Services, LLC (Phoenix), a third-party debt collector that collects primarily past-due medical debts and furnishes information to consumer reporting agencies (CRAs), to settle alleged violations by Phoenix of the Fair Credit Reporting Act and its implementing Regulation V, the Fair Debt Collection Practices Act, and the Consumer Financial Protection Act.  In addition to requiring the payment of consumer redress by Phoenix, the consent order requires the company to pay a $1.675 million civil money penalty to the CFPB.  It is noteworthy that the consent order also includes a provision pursuant to which Phoenix agrees to be subject to the CFPB’s supervisory authority for the consent order’s five-year duration.

The consent order includes the following CFPB findings and conclusions:

• Phoenix violated the FCRA by failing to conduct reasonable investigations of indirect disputes from CRAs and direct disputes from consumers.  Phoenix had inadequate dispute investigation procedures that included Phoenix’s reliance when investigating disputes on data points received from its clients at account placement that Phoenix had not verified as accurate and that Phoenix failed to review other potentially relevant information in its records.  It did not have a sufficient number of employees and contractors to effectively handle the volume of disputes it received, with the result that its employees and contractors often spent “mere seconds on average” to resolve the hundreds of disputes that Phoenix received each day.

• Phoenix violated the FCRA and Regulation V by failing to establish and implement reasonable written procedures regarding the accuracy and integrity of information it furnishes to CRAs.  Phoenix’s audits of its dispute investigation procedures were insufficient for identifying practices that compromised the accuracy or integrity of information furnished to CRAs.

• Phoenix violated the FDCPA by sending collection letters after receiving a written dispute within 30 days of the consumer’s receipt of a debt validation notice but before obtaining verification of the debt or a copy of the judgment and mailing a copy of the verification or judgment to the consumer.

• Phoenix violated the FDCPA by sending debt collection letters to consumers after an oral dispute about the validity or accuracy of the debt without having obtained substantiation for the debt sufficient to provide a reasonable basis for asserting that the consumer owed the debt at the time Phoenix sent the letters.  The implied representation in these letters that Phoenix had a reasonable basis to assert that the consumer owed the debt was false and was a misrepresentation about the validity or accuracy of the debt because Phoenix had no such reasonable basis.  

• By violating the FCRA, Regulation V, and the FDCPA, Phoenix violated the CFPA.

In addition to payment of a $1.675 million civil money penalty, the consent order requires Phoenix to provide consumer redress by refunding all amounts paid to Phoenix on an unverified debt between January 1, 2017 and the date of the consent order by consumers who received unlawful debt collection letters from Phoenix after disputing the validity of the alleged debt.  It also requires Phoenix to abide by certain conduct provisions to prevent it from engaging in the violations found by the CFPB, including not making any representation that a consumer owes a debt unless Phoenix can substantiate the debt claim at the time of the representation.  Phoenix must also establish and implement written policies and procedures to ensure that it conducts reasonable investigations of disputes about information furnished to CRAs.

Medical debt has been a CFPB focus under Director Chopra.  In 2022, the CFPB issued three reports on medical debt along with CFPB comments strongly suggesting that the agency was headed in the direction of taking steps to block or limit the reporting of medical debt.  In February 2023, the CFPB published its report titled “Market Snapshot: An Update on Third-Party Debt Collections Tradelines Reporting,” analyzing trends in credit reporting of debt in collections and its blog post named “Debt collectors re-evaluate medical debt furnishing in light of data integrity issues,” highlighting factors that create challenges for medical collections reporting.  The February report foreshadowed the announcement by Equifax, Experian, and TransUnion in April 2023 that they would remove unpaid medical collections under $500 from consumer credit reports.  In its Data Point released in April 2023 after the announcement, the CFPB estimated how the removal of certain medical collections from consumer credit reports may impact credit based on a sampling of credit reports from 2012-2020 and found that removing medical collection tradelines can significantly improve credit scores and credit availability.

TAMPA, Fla. and SAN FRANCISCO, Calif.– OTDAmericas, a global business process outsourcing company, and LiveVox (Nasdaq: LVOX), a proven cloud CCaaS platform built to transform contact center performance, today announced that LiveVox has been chosen as OTDAmericas’ global contact center platform provider. OTDAmericas is the nearshore subsidiary for parent company, OneTouch Direct, leveraging more than 9,000 employees throughout Colombia, Mexico, and Latin America, with availability for Asia and Europe as well. OTDAmericas will deploy LiveVox’s platform for use throughout the customer journey for its large customer base that includes many of the largest and most recognized Fortune 500 U.S. and global brands across consumer finance, retail banking, technology, telecom, entertainment and media, payment processors, and internet providers.

Built to help contact center leaders redefine customer engagement, LiveVox’s cloud contact center platform incorporates blended omnichannel communications with workforce engagement capabilities that enhance the agent experience and performance. The platform provides immediate access to the tools and information needed to effectively engage customers, understand sentiment, and deliver exceptional CX, as well as security protocols and regulatory compliance solutions that are brand protective and safeguard sensitive information.

“We selected LiveVox based on the platform’s growing workflow automation and collaboration capabilities and flexibility to meet use cases ranging from originations and customer loyalty and retention to customer care and accounts receivable management and specifically for our global clients’ multilanguage customer base,” said Yvonne Torrijos, OTDAmericas’ Chief Client Officer. “Deploying the LiveVox platform will boost agent efficiency and productivity, significantly improving the quality of customer support.”

“LiveVox’s partnership with OTDAmericas will enhance the customer experience and quality management across the full customer lifecycle for their clients,” said John DiLullo, CEO, LiveVox. “Working together, we’re providing fully integrated AI, automation, and multilingual collaboration tools that enhance customer engagement, boost agent productivity, empower their managers and back-office personnel, and maximize the success their clients achieve.”

To learn more about OTDAmericas, contact Yvonne Torrijos at yvonne.torrijos@otdamericas.com.

To learn more about working with LiveVox, please click here.

About OTDAmericas

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

About OneTouch Direct

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

About LiveVox

LiveVox (Nasdaq: LVOX) is a proven cloud CCaaS platform that helps business leaders redefine customer engagement and transform their contact center’s performance. Decision-makers use LiveVox to improve customer experience, boost agent productivity, empower their managers, and enhance their system orchestration capabilities. Everything needed to deliver game-changing results can be seamlessly integrated and configured to maximize your success: Omnichannel Communications, AI, a Contact Center CRM, and Workforce Engagement Management tools.  

For more than 20 years, clients of all sizes and industries have trusted LiveVox’s scalable and reliable cloud platform to power billions of omnichannel interactions every year. LiveVox is headquartered in San Francisco, with international offices in Medellin, Colombia and Bangalore, India.

To stay up to date with everything LiveVox, follow us @LiveVox, visit www.livevox.com

or call one of our specialists at (844) 386-5934.

NEW YORK CITY, N.Y. — McGlinchey Stafford is pleased to announce that the firm’s New York City office has strengthened its prominent Financial Services Litigation and Commercial Litigation practices with the addition of Jason Lipkin, who joined as of counsel, and Melisa Zukic as an associate. Jason and Melisa mark six new hires in McGlinchey’s New York City office in the past six months, following the recent additions of Brittany Adikes and Camille Singh.

“We are pleased to welcome Jason and Melisa to McGlinchey’s growing team here in New York City,” said Mikelle Bliss, managing member of the New York City office. “Their in-depth knowledge of the particular regulatory regimes governing the financial services, commercial, and real estate markets in New York and New Jersey will be a great asset to our financial services and other clients nationwide.”

McGlinchey now has 12 attorneys practicing in its Albany and New York City offices, and a total of 15 attorneys licensed to practice in New York.

Jason, a former attorney at Winston & Strawn, brings his 17 years of experience representing a diverse group of clients across a broad spectrum of financial services, real estate, and commercial and insurance matters in New York and New Jersey state and federal courts. Prior to that role, Jason was a founding member at a boutique commercial litigation firm. He also spent several years at a large insurance defense firm, representing Fortune 500 companies in product liability and toxic exposure cases, and is admitted to practice in New York and New Jersey. His primary focus upon joining McGlinchey will be in the financial services litigation space.

As a consumer financial services attorney, Melisa advises creditors, banks, mortgage servicers, corporations, and insurers in complex litigation and arbitration matters and on appeal. She represents financial institutions in CFPB investigations and in complaints filed with the New York State Department of Financial Services. She also defends lenders and mortgage servicers in a broad array of disputes and litigation.

Before joining McGlinchey, Melisa served as litigation counsel at Hinshaw & Culbertson. Melisa received her J.D. from Touro College Jacob D. Fuchsberg Law Center in 2015, and  is admitted to practice in New York.

“This industry is constantly evolving, and both Jason and Melisa understand the dynamic nature of litigating matters and the challenges our clients face,” said Shaun Ramey, co-chair of the firm’s nationwide Financial Services Litigation practice group. “They bring insight into our clients’ business operations to develop strategic legal solutions to their challenges.”

McGlinchey’s nationwide  Financial Services Litigation practice group is the firm’s largest, with 65 attorneys licensed to practice in 25 states. Since 2022, the group has hired 18 new attorneys in 11 of the firm’s 17 offices. The team’s attorneys are recognized nationally and in New York as industry leaders, with Best Lawyers and Super Lawyers honors.

Their collective experience includes federal and state regulatory and enforcement proceedings, hundreds of class actions in state, federal, and bankruptcy courts, and tens of thousands of consumer litigation matters. The group represents every type of financial services company, including national and state-chartered banks, finance companies, mortgage lenders and servicers, reverse lenders, manufactured housing lenders, credit card issuers, automobile lenders, student lenders, community banks, thrifts, credit unions, FinTechs, and insurance providers.

The attorneys in McGlinchey’s New York City office focus on consumer financial services litigation and other commercial litigation matters, representing many of the largest financial institutions in the United States.

About McGlinchey

McGlinchey Stafford is a premier midsized business law firm offering services in nearly 30 practice areas through a highly integrated national platform. McGlinchey attorneys leverage bold innovation, diverse talent, and leading-edge technology across our powerful network to serve clients at the local, regional, and national level. With 150 attorneys licensed in 32 states, McGlinchey operates from 17 offices nationwide. The firm currently has 23 attorneys and 9 practice areas recognized in Chambers U.S.A. 2023 and Chambers FinTech 2023, 53 attorneys recognized by Best Lawyers, 40 attorneys recognized in various Super Lawyers rankings, 49 practice areas recognized by Best Law Firms, and was named a “Top Performer” by the Leadership Council for Legal Diversity (LCLD) since 2018. To learn more, visit www.mcglinchey.com.

Organizations in the ARM industry have embraced the use of digital channels to not only communicate with customers, but to also improve the collections process. But that is just the first step. Organizations must also leverage artificial intelligence to identify and contact the highest-potential accounts at the most opportune time by leveraging machine learning algorithms.

Knowledge is power

The better you know your customers, the better you can serve them. That’s not an earth-shattering revelation. Organizations spend a significant amount of time and budget to do just that. What they’ve discovered is that consumers prefer to be treated as individuals and in a way that is relevant and tailored to their preferences.

[article_ad]

To provide this kind of personalization, organizations need to dig a little deeper to understand consumers’ preferences.  With a better understanding of how consumers prefer to communicate and pay, you can improve consumer engagement and operational efficiencies to drive revenue growth.

This data is also critical to drive your digital strategies. For example, organizations often focus on digital natives – those who grew up online, using computers, tablets and smartphones practically since they were born. However, that’s a little short-sighted.

According to a recent survey, consumers 55 years and older are more comfortable paying bills online than their younger counterparts. These consumers, sometimes referred to as baby boomers, have adapted to the digital era and continue to take advantage of the convenience of conducting business and paying bills online.

The same study also confirms that education level impacts communication and payment preferences. The higher the level of education in U.S. adults, the more comfortable they are with communicating through digital channels. For example, a large gap exists in the percentage of those who prefer to receive payment reminders and billing statements via email for those who have a high school diploma or less versus those who have a bachelor’s degree.

Survey data, such as this, is helpful in getting to know your customers. But this type of static data only paints part of the picture. To get a complete look at your customers, you need more. And you can use technology to get it.

Better to know you with

ARM organizations focus the most time and effort on the accounts that are most likely to pay. Traditionally, they determine this using the scores from credit reports. Yet, this type of static data can’t be updated in real-time and only gives organizations a limited view of the customer.

Organizations need to leverage dynamic scoring models that can be updated in real-time to get a more accurate look at their customers.

Machine learning (ML), one kind of artificial intelligence (AI), can help with this when combined with historical data along with alternative data sources, such as spending behavior, social media activity, online presence, and more.

This ongoing process of gathering and evaluating data provides a more holistic view of consumer behavior. And that can provide huge benefits.

The proof is in the pudding

An advanced segmentation solution that uses ML can breathe new life into your portfolios and increase the value of accounts you might not be working today. The algorithms that drive decision-making and guide account work are easily understandable and “explainable,” alleviating collectors’ and regulators’ concerns around disparate impact.

But don’t take my word for it. Organizations that have incorporated a solution that uses advanced segmentation have reported:

• More than a 50% increase in revenue per call
• More than a 20% increase in right party contact rate
• More than a 40% increase in average yield per account
• A 50% increase in overall collections.

Agencies that embrace the digital technology that allows them to better understand and connect with their consumers will quickly set themselves apart from the competition.

On June 6 2023, the Consumer Financial Protection Bureau (CFPB) issued a report analyzing the use of chatbots in consumer finance and the impact on customer service. The report notes that financial institutions are increasingly using chatbots to reduce the costs of human customer service agents, and moving away from simple, rules-based chatbots toward more sophisticated technologies, such as large language models and generative chatbots and others marketed as artificial intelligence (AI).

The report found that while chatbots may be useful for answering basic questions, their effectiveness lessens as the questions become more complex. According to the CFPB, “[r]eview of consumer complaints and of the current market show that some people experience significant negative outcomes due to the technical limitations of chatbots functionality.” Additionally, the CFPB warns that financial institutions may risk violating federal consumer protection law when deploying chatbot technology. In addition to potential privacy and security risks, the CFPB states that “[w]hen chatbots are poorly designed, or when customers are unable to get support, there can be widespread harm and customer trust can be significantly undermined.”

Chatbots are computer programs that mimic human interaction by processing a user’s input to produce an appropriate output. “Rule-based chatbots use either decision tree logic or a database of keywords to trigger preset, limited responses. These chatbots may present the user with a set menu of options to select from or navigate the user between options based on a set of keywords and generate replies using predetermined rules … More complex chatbots use additional technologies to generate responses. Specifically, these chatbots may be designed to use machine learning or technology often marketed as ‘artificial intelligence’ to simulate natural dialogue.” Chatbots have been widely adopted by banks, mortgage servicers, and debt collectors. In 2022, over 98 million consumers interacted with a bank’s chatbot and that number is projected to grow to 110.9 million users by 2026.

According to the CFPB, while the use of chatbots has increased, so have the consumer complaints, including complaints concerning:

*Difficulties in recognizing and obtaining dispute resolution.

• Chatbots process only specific words or syntax to recognize a dispute and begin the process of dispute resolution. So the ability of chatbots to discern disputes may be limited.

• Even when chatbots do recognize a dispute, their ability to reach a resolution can be limited. “In some cases, customers are disputing transactions or information that is incorrect. Chatbots that are limited to simply regurgitating the same system information that the customer is attempting to dispute back to them are insufficient.”

• Importantly for fair lending concerns, a chatbot’s limited syntax may be problematic for consumers with limited English proficiency.

*Difficulties obtaining accurate or sufficient information.

• Studies have shown that chatbots sometimes generate inaccurate data that go undetected by some consumers. Specifically, researchers have found that chatbots are ill-suited for tasks that require logic, specialized knowledge, or current data.

• According to the CFPB, “[w]hen a chatbot is backed by unreliable technology, inaccurate data, or is little more than a gateway into the company’s public policies or FAQs, customers may be left without recourse. Providing reliable and accurate responses to people with regard to their financial lives is a critical function for financial institutions.”

* Difficulties obtaining meaningful customer service.

• A chatbot’s scripted responses may fail to answer a customer’s questions and instead lead to “doom loops” or “continuous loops of repetitive, unhelpful jargon or legalese without an offramp to a human customer service representative.”

* Difficulties obtaining intervention from human customer service representatives.

• Consumers complain about the lack of access to or unreasonably long wait times for human customer service representatives. The limitations of chatbots and lack of access to a human customer service representative may not be apparent to customers when they are initially signing up with a specific financial institution.

• Moreover, chatbots may be less likely to waive fees or negotiate on prices.

* Difficulties keeping personal information safe.

• Fake chatbots can be used by fraudsters to conduct phishing attacks.

• Customers must validate themselves as the owner of a specific account by providing personally identifiable information. Therefore, these chat logs provide another venue for privacy attacks.

The report concludes by warning financial institutions that the difficulties listed above can not only lead to dissatisfied customers, but also to violations of federal consumer protection laws. “Deficient chatbots that prevent access to live, human support can lead to law violations, diminished service, and other harms. The shift away from relationship banking and toward algorithmic banking will have a number of long-term implications that the CFPB will continue to monitor closely.”

Troutman Pepper’s Take:

We believe this is the first regulatory statement about the use of chatbots by financial services companies, and it follows the now-familiar theme of hostility to AI and algorithms, underscoring that relationship banking is at risk of being replaced by algorithmic banking. Although the statement certainly appears aimed at causing financial institutions to pay close attention to the problems asserted by the CFPB, it remains to be seen whether the CFPB will truly elevate what seems like customer service issues to alleged violations of law. We’ll be watching this issue closely.

POTOMAC, Md. – Women in Consumer Finance (WCF) is proud to announce that the opening keynote session for this year’s leadership summit (December 11-13, 2023 in Palm Springs, CA) will be presented by Sallie Krawcheck, Co-Founder and CEO of Ellevest, an investment and wealth management platform built by women, for women. 

A leading authority in the world of finance and a passionate advocate for building women’s wealth, Sallie Krawcheck has been called both a “Top Female Founder” and “The Last Honest Analyst” by Fortune Magazine. With an extensive background in finance — including roles as CEO of Merrill Lynch, Smith Barney, and Sanford Bernstein, as well as CFO of Citi — Krawcheck has centered her professional attention on helping women reach their financial goals. She shares WCF’s belief that doing so will improve the lives of women and have a lasting positive impact on their families, their communities, and the broader economy. 

Krawcheck shared, “We women make up more than 50% of the workforce; we direct 80%+ of consumer spending; and we have literally trillions of dollars in wealth. Yet we have less room for error in our financial planning than men do — given lower earnings, more career breaks, and longer lives. That’s why I’m thrilled to speak at this year’s Women in Consumer Finance leadership summit to ensure more of us are tapping into our financial power and continuing this conversation.”

Driven by the mission to get more money in the hands of women, Ellevest was founded on real, hard data about women’s lives, like the fact that they are paid less, stop getting raises a whole decade earlier, live longer, pay the pink tax, have more debt, do more unpaid labor, and get fewer promotions than men. The harsh realities of these factors can fundamentally change what women need to build their best financial futures. Ellevest offers digital investing, financial planning, and private wealth management, an innovative approach that uniquely meets clients wherever they are in their financial journey with holistic financial guidance.

In addition to Krawcheck’s keynote, Ellevest Private Wealth Advisor Ashley Bleckner, CFP®, CDFA®, MA, will lead a session on financial planning on December 11, 2023. This workshop will cover retirement and estate planning, investing opportunities, and more, as well as provide ample opportunity to ask questions in a supportive environment. The goal of this session, which is optional and pre-conference, is to provide a solid foundation for setting personal finance goals and investment planning.

“The alignment between Ellevest and Women in Consumer Finance couldn’t be more perfect. Ellevest wants to get more money into women’s hands. WCF wants to get more women to decision-making tables. We both provide a platform for achieving these goals that is a safe space, designed for women,” said Stephanie Eidelman, Co-Founder and CEO of Women in Consumer Finance.

About Women in Consumer Finance

Women in Consumer Finance is a leadership summit and community for women at all levels in the context of a common industry. If you work in any role at a lender, creditor, servicer, law firm, or technology or service provider, this event is for you. We provide inspiration, a guiding hand, and a support system women can leverage to recharge or advance their careers and deliver value to their employers. WCF is not about finance. It’s about women, our common personal and professional challenges, and how to craft our own career journey and reach our full potential. We take a unique team-based approach to creating an emotional shared experience, which helps participants build confidence and ensures everyone establishes meaningful connections. The impact of participating in WCF is deep and lasting. www.womeninconsumerfinance.com

About Ellevest

Ellevest is an investing and wealth management company built by women, for women that provides a holistic, modern approach to financial guidance. As the experts in building and managing women’s wealth, Ellevest’s offerings include digital investing, financial planning, impact investing, and retirement planning, as well as private wealth management for high net worth individuals. Founded in 2014 by Sallie Krawcheck and Dr. Sylvia Kwan, Ellevest has $1.6 billion in assets under management, and was named Best Mission-Oriented Investing Service by Bankrate. See ellevest.com for more information.

Contact:

Stephanie Eidelman

Co-Founder & CEO, Women in Consumer Finance

stephanie@womeninconsumerfinance.com

For Ellevest:

Sunshine Sachs Morgan & Lylis  

press@ellevest.com or ellevest@ssmandl.com 

Don’t miss your chance to hear from Sallie and participate in this transformative event. Spots are limited, and tickets are selling fast! Secure your place at WCF 2023 before June 30th to save $250 on your ticket with our early bird pricing.