DULUTH, GA —  Crown Asset Management, LLC (CAM), a receivables management and specialty finance firm in Duluth, GA, is pleased to announce the addition of Chris McGill as Human Resource Manager, bringing with her over 25 years of experience and expertise in human resources. Ms. McGill’s responsibilities include proactively identifying and addressing challenges, developing and implementing company policies for increased efficiency, delivering training, and enhancing the employee experience.

During her tenure, Chris has worked at the mid to senior-level human resource management for large Fortune 500 companies such as AT&T, Comcast, and JC Penney to name a few. Most recently, Chris served as the Senior Regional HR Manager for a large furniture retailer where she oversaw the entire human capital management for 1,000 employees in 7 states. In this role, she developed and oversaw the implementation of a strategic staffing plan, led the creation of diversity, equity, and inclusion programs, and helped management achieve desired business goals.

“Chris is an excellent addition to our CAM team,” says CEO and Owner Brian Williams. “With her depth of experience implementing comprehensive HR strategies that achieved organizational goals and enhanced the employee experience, we are looking forward to her engaging our employees and enhancing the employee experience here at Crown Asset Management.”

In her career, Ms. McGill served as the Director of Human Resources for AFC Enterprises, Inc. where she partnered with 4 Brand HR Vice Presidents (Church’s, Popeye’s, Cinnabon, and Seattle’s Best Coffee) to align and drive functional human resources initiatives for over 500 company owned locations in 8 states. She previously held the position of Senior HR Manager for JC Penney’s Forest Park, Georgia location, which at the time was the 2^nd largest distribution center. During her tenure, she successfully led a massive workforce restructuring initiative with over 2,000 employees and contractors and was instrumental in helping the center remain Union-free. Chris has extensive experience as a trusted advisor for leadership teams regarding the execution of strategic and tactical HR processes including employee relations, talent acquisition, performance management cycle, and talent planning and development.  

“I am thrilled to be joining the CAM team. Although it’s a small company, they have an amazing culture coupled with a very strong financial foothold in the ARM industry,” shares Ms. McGill. “With the heart and passion of a large company and the spirit, personalization, and trusted quality of a small business, clients have come to depend on CAM and its professional team. I am excited to help advance the CAM Human Resources Department and further expand my skills. I appreciate the warm welcome that I’ve received and look forward to developing many positive employee relationships and to helping Crown to grow.”

Ms. McGill holds a Professional in Human Resources (PHR) certification and received her Masters’ degree in Human Resources Management and Development from National-Louis University. She has remained an active member of the Society of Human Resource Management (SHRM-National) since 2010. In her spare time, Ms. McGill enjoys bowling, swimming, diving, dancing, and watching and attending sporting events such as track & field, volleyball, gymnastics, professional basketball, and professional football. In fact, she is such an avid Atlanta Falcons fan that she drove to her hometown of Houston to watch them play in the Super Bowl! In addition to her many hobbies, she regularly supports the causes important to her, including Dress for Success, Hope House, Big Brother/Big Sister, and Hosea Feed the Hungry and Homeless, Inc.

About Crown Asset Management

Founded in 2004, Crown Asset Management, LLC, is a professional receivables management firm that outsources purchased accounts to a nationwide, proprietary network of collection agencies and law firms. Utilizing a cutting-edge predictive analytical model during pre-purchase portfolio due diligence, their team focuses on achieving appropriate financial returns for investors while ensuring the best possible experience for consumers. They are an RMAI Certified Receivables Business and are headquartered in Duluth, GA.

COLORADO SPRINGS, Colo. — Credit Service Company (CSC) is pleased to announce that Todd Jenkins recently joined its executive leadership team as Vice President of Sales and Business Development. He is responsible for top-line sales growth of CSC’s third-party debt collection services for the healthcare, government, education, financial, commercial and utilities industries.

Jenkins brings more than 21 of professional experience, the last 12 of which have been in senior-level sales positions. Jenkins is also a Gulf War veteran and has served at the National Security Agency, where he enjoyed a Top Secret security clearance.

For Jenkins, the best part about working at CSC is being part of a family- and faith-focused organization. 

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“I’m looking forward to providing a first-class sales experience to our valued clients, prospective clients, growing the organization smartly, and providing a means by which each consumer is positively impacted by CSC,” Jenkins said.

CSC Executive Director Tracey Cannella is pleased to have Jenkins on the executive team. “As a proven leader in sales and sales management, Todd fills a vital role in helping us to build strong customer relationships and ensure a culture of excellence.” 

About Credit Service Company

Credit Service Company, with headquarters in Colorado Springs, Colo., is a full-service collection agency. CSC has been serving the medical, governmental, educational, financial, commercial and utilities industries for more than 70 years.

On June 1, 2021, the Consumer Relations Consortium (CRC) filed an amicus brief supporting the defendant’s petition for rehearing en banc in the case of Hunstein v. Preferred Collection Services, 94 F.3d 1341 (11th Cir. 2021). Jessica Klander of Bassford Remele and Brit Suttell of Barron & Newburger, P.C. prepared the brief on behalf of the CRC.

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The CRC’s brief addressed oversights by the panel, which if left uncorrected, would leave intact a decision that deviates from the Fair Debt Collection Practices Act (FDCPA) and Regulation F. The two specific issues raised by the CRC in its brief were:

• Whether the panel erred in its interpretation of the FDCPA by failing to review the FDCPA as a whole. The CRC’s position is that a mail vendor is not a “person” under the statute but is instead a “medium” through which information travels and that when read as a whole, the FDCPA supports this position. 

• Whether the panel erred by failing to look at Regulation F when it rendered its opinion. The CRC’s position is that Reg F supports the use of vendors. Although Reg F was not published when the parties briefed the issues in Hunstein, Reg F was published before the panel rendered its decision. The CRC believes that since the use of vendors and specifically mail vendors are assumed, adopted, and referred to throughout Reg F, the panel should have looked to the regulation for guidance and deferred to Reg F’s stance on the issue. 

The brief goes on to state that the 11^th Circuit Court of Appeals should grant a rehearing en banc so that it can consider all of the issues and the ramifications of the decision. Regarding the decision and the push for rehearing en banc, Jessica Klanders stated,

“It goes without saying that the Hunstein decision is of exceptional importance and has already had an unprecedented impact on the collection industry.  There are many efforts currently underway to address this decision, but a critical first step is to persuade the 11th Circuit Panel to rehear the issues and reconsider its ruling.”

The brief filed by the CRC can be found here.

We will continue to bring you news on this story as it develops. However, please note that there is no specified date or timeline for the court to rule on the defendant’s request for rehearing or review of the amicus briefs.

About the Consumer Relations Consortium

The Consumer Relations Consortium (CRC) is a membership group for forward-thinking organizations that wish to influence the direction of collections compliance, legal strategy, and regulatory policy. The CRC is comprised of more than 60 national companies representing the diverse ecosystem of debt collection including creditors, data/technology providers, and compliance-oriented debt collectors that are larger market participants. Established in 2013, CRC is evolving the debt collection paradigm by engaging stakeholders—including consumer advocates, Federal and State regulators, academic and industry thought leaders, creditors, and debt collectors—and challenging them to move beyond talking points and focus on fashioning real-world solutions that actually improve the consumer experience. CRC is managed by The iA Institute. 

Learn more at www.crconsortium.org.

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.

Learn more at www.theiainstitute.com. 

As I laid out a few weeks back, the Hunstein flubbed its Article III standing analysis in a big way. Specifically, after determining that a violation of 1692c(b) can cause intangible harm it stopped short of determining whether the specific violation of 1692c(b) in the case before it actually did cause harm. That’s a big no no that flat misapplies Spokeo’s “concrete harm” analysis.

Well in a new decision out today, a district court in Florida relies upon Hunstein for its Article III analysis right up until it completely departs from it.

In James v. Circle K Stores, Case No.: 1:20cv215-MW/GRJ, 2021 U.S. Dist. LEXIS 95581 (N.D. Fl. May 20, 2021) the Court considered an Article III standing challenge in a FCRA suit. In teeing up the standard for assessing “concrete harm” for the statutory violation at issue in the case, the James court repeatedly cited Hunstien as providing the standard of decision. It ultimately concluded—following Hunstein that the violation of the FCRA section at issue was closely related to the old common law “intrusion of seclusion” tort and, thus, a violation of the statute can cause intangible harm recognized by the Courts.

But unlike in Hunstein—where the court found the presence of the possibility of intangible harm sufficient to convey standing—the James court moved on to the second step that the Hunstein panel ignored:

“it is not enough that the harms match in the abstract; this Court must look to the harm Plaintiff actually suffered in this case-i.e., the harm produced by the statutory violation at issue.”

Tellingly, James cites to a different Eleventh Circuit decision to support the requirement to look at the specific harm caused in each specific case—Muransky. In the end the James court concluded that the Defendant had not “actually intruded upon Plaintiff’s seclusion” because “the harm of this statutory violation is not comparable to the harm of intrusion upon seclusion, this analysis of history and harm supports the conclusion that Plaintiff does not demonstrate injury in fact and lacks Article III standing.”

Applying the logic of James to the facts of Hunstein would likely yield a very different standing outcome—one that would have wholly avoided the disastrous substantive ruling that followed.

Se la vi.

GASPORT, N.Y. —  Logos Capital Systems (Logos) announces a new monthly charity initiative that gives top performing employees an opportunity to donate to the charitable organization of their choice. Logos’ team of receivables management professionals is incredibly engaged in corporate social responsibility efforts and dedicated to making an impact in their communities. Logos empowers its team to allocate their monthly donations to the charities that are closest to their hearts.

“Our company is known for its deployment of innovative technology, commitment to industry compliance, and expertise in delivering exceptional customer service, but philanthropy is at the heart of our organization. The opportunity to reward our team members for their efforts through charitable giving deepens our company culture and encourages employee engagement,” says John Verbocy, Chief Compliance Officer. “Adversity strengthens the mind and spirit; and even in losses, we gain so much in spirit and gratitude. It is not just our corporate responsibility but also our human responsibility to lift others up in times of need and to remember that kindness doesn’t always require grand gestures, but rather the patience and heart to recognize and help one person at a time.”  

No strangers to overcoming adversity and tragedy, the idea for the new initiative came from the desire to support organizations that are personal to the Logos team. This month, The Christopher and Dana Reeve Foundation was chosen in memory of John’s uncle who was paralyzed at the age of 18 from diving into a pool and passed away at the age of 65. Himself a two-time leukemia survivor, John supports The Gerson Institute to further cancer research. As an extension, the Make A Wish Foundation was chosen by the team to give hope to children who are in a similar situation as John and are fighting to survive a critical illness. 

Other incredible charities Logos is supporting this month include The American Foundation for Suicide Prevention to honor team members’ loved ones who have succumbed to life pressures, including unemployment, that can tragically lead to suicide. The entire Logos team holds active and veteran US Military service members in the highest regard. To show their appreciation for their tremendous sacrifices and the sacrifices that their families make to protect our way of life, Logos supports the Wounded Warrior Project.

“We look forward to extending our outreach to multiple causes that are most important to our employees,” Mr. Verbocy continues. “We are excited about letting our employees choose among different causes, so that whether they are passionate about animals, humanitarian efforts, medical research, or supporting our military families, we have a chance to support many foundations over the coming months. We’re extremely proud of this program and confident that our Logos Capital Systems’ initiative will continue to make an impact in the communities where our passionate employees work and live.”

Logos encourage you to join them in their efforts by supporting organizations that are important to you. To learn more about how Logos is working to better our communities and support our global neighbors in need, please visit the Logos News page and follow Logos on social media. 

About The American Foundation for Suicide Prevention

The American Foundation for Suicide Prevention is dedicated to saving lives and bringing hope to those affected by suicide. It creates a culture that’s smart about mental health through education and community programs, develops suicide prevention through research and advocacy, and provides support for those affected by suicide. 

About Wounded Warrior Project

Since 2003, Wounded Warrior Project^® (WWP) has been meeting the growing needs of warriors, their families, and caregivers—helping them achieve their highest ambition. WWP is a national, nonpartisan organization accredited with the Better Business Bureau (BBB), top rated by Charity Navigator, and holds a GuideStar Platinum rating.

About The Christopher and Dana Reeve Foundation

The Christopher and Dana Reeve Foundation is dedicated to curing spinal cord injury by advancing innovative research and improving quality of life for individuals and families impacted by paralysis. There are many ways to get support, get involved and donate to support the Reeve Foundation mission.

About The Gerson Institute

The Gerson Institute is a non-profit organization located in San Diego, California, dedicated to providing education and training in the Gerson Therapy™, an alternative, non-toxic treatment for cancer and other chronic degenerative diseases.

About The USO

The USO strengthens America’s military service members by keeping them connected to family, home and country, throughout their service to the nation. They are a nonprofit organization that provides live entertainment, such as comedians, actors and musicians, social facilities, and other programs to members of the US Armed Forces and their families.

About Make-A-Wish

Make-A-Wish® is the nation’s largest wish-granting organization. It has fulfilled the wishes of more than 315,000 children in the United States and its territories since 1980. Headquartered in Phoenix, Make-A-Wish serves every community in the United States, Guam, and Puerto Rico through its 60 chapters. 

About Logos Capital Systems

Logos Capital Systems is a nationally licensed debt collection agency that is dedicated to their service-driven culture, industry and legal compliance, and reputation management. The Logos experienced team of professionals combines proprietary technology and data-driven analytics to provide our clients reliable asset recovery solutions for accounts at all stages of the credit cycle. Logos fully complies with the Fair Debt Collection Practices Act (FDCPA) and all other applicable laws, rules, and regulations. The Logos team is an active participant in receivables trade associations and advocate strongly on behalf of the receivables management industry.

SEWELL, N.J. — Maxwell and Graves Solutions, LLC (M&G), a leading consulting firm with expertise in collections and servicing in the financial lending space, announced that veteran compliance executive Colene McNinch has joined the company as Partner and Chief Compliance Officer.   

Colene will direct and help expand M&G’s service offering related to compliance, regulatory controls and audits, Compliance Management System development, in addition to leveraging her operational expertise to drive expansion in collection strategy.

“Colene brings an incredible wealth of industry experience having held significant leadership and executive roles over her career” said Michael Cassidy, Managing Partner at M&G. “She has worked with and for high-performing organizations, including those in support of Top 5 US banks, and understands the delicate balance between performance and compliance.”

Colene has held executive leadership roles in compliance, operations, and account management over her 25+ years in the ARM industry. For the last 8+ years, she served as the Chief Compliance Officer for United Collection Bureau, Inc. In this role, she evaluated compliance risk within the organization and ensured compliance with the rules and regulations of federal and state regulatory bodies by instituting and maintaining an effective compliance program.   

“I am excited to join such a dynamic company at a time when it is more important than ever to ensure compliance with regulator expectations and to make the financial marketplace more fair for consumers,” said Colene. She added, “In the famous words of Teddy Roosevelt, ‘Far and away the best prize that life has to offer is the chance to work hard at work worth doing.’”

For more information, contact Colene via email at colene.mcninch@maxgraves.com.

About Maxwell & Graves Solutions, LLC

M&G Solutions is an industry leading consulting firm with expertise delivering world class operational performance and execution in the financial lending space. M&G Solutions combines years of first-hand experience working for Fortune 500 and other innovative companies within financial service, BPO and Fintech industries to help our clients identify, deliver, and sustain the necessary enhancements to drive their business. To learn more, visit www.maxgraves.com and follow us on LinkedIn.

Show Notes:

Since the start of the pandemic, the financial services industry, including the accounts receivable management (ARM) industry, has predicted that the use of technology to contact consumers will grow exponentially. That prediction came true, but Firstsource Solutions, a leading provider of business process solutions to more than 100 global businesses, has been using email and text to contact consumers since 2017. Arjun Mitra, President of Global Collections, stops by CreditEcoToGo to discuss the success of his company’s platform. The results show that consumers are far better off in resolving their financial issues on their own terms.

Arjun reports that RPC or open engagement rates from consumers in a response to an email or text are far superior than any response to a traditional telephone call. Additionally, the platform can fully adapt to a consumer’s response allowing users to constantly adjust and tailor the messaging in order to continue the successful consumer engagement. 

DISCLAIMER – No information contained in this Podcast or on this Website shall constitute financial, investment, legal and/or other professional advice and that no professional relationship of any kind is created between you and podcast host, the guests or Clark Hill PLC. You are urged to speak with your financial, investment, or legal advisors before making any investment or legal decisions.

The U.S. Court of Appeals for the Second Circuit recently affirmed a trial court’s judgment in favor of a consumer reporting agency (CRA).

In so ruling, the Second Circuit held that the trial court correctly determined that:

1. the CRA’s credit report stating that a judgment against the plaintiff was “satisfied” was accurate, even though the plaintiff claimed the judgment was “vacated”; and
2. the plaintiff could not establish damages arising from the CRA’s allegedly negligent conduct; and
3. the CRA did not need to prove it actually interpreted the FCRA in line with its claimed reasonable interpretation to rely on the reasonable-interpretation defense established by Safeco Insurance Company of America v. Burr, 551 U.S. 47, 57 (2007).

A copy of the opinion in Shimon v. Equifax Information Services LLC is available at:  Link to Opinion.

After a debt collector obtained a default judgment against the plaintiff in a debt collection action, the collector began garnishing the plaintiff’s wages. The plaintiff then appeared in the action, eventually entering into a stipulation of settlement.

When the plaintiff learned that the defendant, a consumer reporting agency, was including the 2013 default judgment on his credit report, he filed suit, alleging that, in reporting the judgment as “satisfied” and in its subsequent dealings with the plaintiff, the CRA willfully and negligently violated the source-disclosure, accurate reporting, and reinvestigation provisions of the Fair Credit Reporting Act, 15 U.S.C. §§ 1681g(a)(2), 1681e(b), 1681i(a)(6)-(7).

The trial court dismissed one of the plaintiff’s FCRA claims under Fed. R. Civ. P. 12(b)(6), denied leave to amend that claim, and granted summary judgment to the CRA on the plaintiff’s remaining FCRA claims. In its ruling on the CRA’s summary judgment motion, the trial court found that the description of the judgment as “satisfied” was accurate. The plaintiff timely appealed.

The Second Circuit noted that the overwhelming weight of authority in the Circuit “holds that a credit report is inaccurate [under § 1681e(b)] either when it is patently incorrect or when it is misleading in such a way and to such an extent that it can be expected to have an adverse effect.” Khan v. Equifax Information Services, LLC, No. 18-cv-6367 (MKB), 2019 WL 2492762, at *3 (E.D.N.Y. June 14, 2019).

The plaintiff acknowledged that the court in the debt collection action reported that the case against him was “settled.” The plaintiff also did not dispute that the CRA was following a standard practice in the credit reporting industry by reporting a settled debt-collection judgment as “satisfied.”

The plaintiff however argued that, when the court in the debt collection action ordered the stipulation, it also implicitly vacated the judgment. Thus, he maintained that the defendant was obligated to report the judgment as “vacated.” The plaintiff also contended that, by denoting the judgment as “satisfied,” the CRA misled its readers because it implied that a judgment remained.

However, the Second Circuit observed that the court docket did not reflect a vacatur. Also, the Court held that describing a judgment as “satisfied” does not imply that it “remains;” if anything, according to the Court, it implies the opposite.

The Second Circuit therefore held that the accuracy of the plaintiff’s credit report was fatal to his § 1681e(b) claims that the CRA engaged in willful or negligently inaccurate reporting. Therefore, the Court affirmed the trial court’s judgment dismissing those claims.

Furthermore, the trial court granted summary judgment to the CRA on the plaintiff’s § 1681g source-disclosure negligence claim based upon its conclusion that, even if the CRA should have disclosed the judgment reporting service as a “source” of information on the judgment, the plaintiff presented no evidence that he suffered any actual damages resulting from the failure. On appeal, the CRA adopted the trial court’s “no-actual-damages” approach to argue for affirming the trial court’s judgment regarding the plaintiff’s § 1681i reinvestigation negligence claim as well as the § 1681g source-disclosure claim.

The Second Circuit agreed with the CRA that the plaintiff had failed to present any evidence for concluding that he suffered actual damages as a result of the CRA not disclosing or treating the judgment reporting service as a “source” or “furnisher” of information to it about the judgment.

Because the Court held that the credit report was accurate, the Court also concluded that the plaintiff’s learning that the judgment reporting service was the intermediary source of the CRA’s information would not have enabled the plaintiff to avoid the emotional damages that he claimed to have suffered. Nor would he have avoided any of the costs he claimed to have incurred in disputing the credit report.

Accordingly, the Court held that the CRA was entitled to summary judgment on the plaintiff’s § 1681g and § 1681i negligence claims.

The trial court also dismissed the plaintiff’s § 1681g willfulness claim after concluding that the CRA reasonably interpreted “source” not to include a contractor-intermediary doing what the judgment reporting service did in this case. In responding to the plaintiff’s arguments on appeal, the CRA also contended that its position that the judgment reporting service did not constitute a “furnisher of information” under § 1681i was reasonable, despite the trial court’s determination otherwise (and despite the trial court’s award to the CRA of summary judgment on the claim on a different basis).  

As you may recall, in Safeco Insurance Company of America v. Burr, the Supreme Court of the United States held that a credit reporting agency may “willfully” violate the FCRA by acting in “reckless disregard of statutory duty.” 551 U.S. 47, 57 (2007). The Supreme Court explained that a company does not act in “reckless disregard” of the FCRA, however, if its “reading of the statute . . . was not objectively unreasonable.” Id. at 69.

The FCRA’s reinvestigation provision requires that, under certain circumstances, consumer reporting agencies provide information about “any furnisher of information contacted in connection with such information, and also that consumer reporting agencies provide notice of consumer disputes to “furnisher[s] of information.” Id. § 1681i(a)(6). It defines “furnisher” to include “any person who provided any item of information in dispute.” Id. § 1681i(a)(2). The defendant argued that it is reasonable for an agency to construe this provision to exclude its own contractor charged with gathering public records on the agency’s behalf.

Additionally, the FCRA’s source-disclosure rule requires consumer reporting agencies to disclose to the consumer, on request, the “sources of the information” in the consumer’s file. Id. § 1681g(a)(2). The defendant argued that it is a reasonable construction of the statute to interpret “sources of information” as referring to the original source of the reported information, as opposed to any contractors that gathered the information on an agency’s behalf.

The Second Circuit agreed with the CRA and held that it was an objectively reasonable reading of these provisions to exclude from “furnisher” and “sources” a contractor such as the judgment reporting service working on the reporting agency’s behalf when the information in question was contained in a particular set of files, the consumer reporting agency identified the court and its files as the “furnisher” or “source” of the information, and the function of the undisclosed contractor was to check those files to determine the accuracy of the report.

Moreover, the Second Circuit rejected the plaintiff’s argument that the CRA needed to show that it actually and contemporaneously adopted this statutory interpretation to avail itself of the Safeco defense. The Court noted that the Safeco court emphasized that whether a company committed a willful violation of the FCRA is an objective inquiry and dismissed arguments that “evidence of subjective bad faith” could create liability in the face of objectively reasonable interpretations. Safeco, 551 U.S. at 70 n.20

Accordingly, the Second Circuit held that when the CRA advised its customers that the judgment against the plaintiff was “satisfied,” it gave an accurate report. Also, the Court purposefully did not decide whether the FCRA might be read to obligate the CRA to respond to the plaintiff’s source disclosure and reinvestigation requests by informing him of the judgment reporting service’s role because (1) § 1681g and § 1681i can reasonably be interpreted to not require such a disclosure; and (2) even if the CRA was negligent in determining its obligations under those provisions, the plaintiff pointed to no harm he suffered as a result.

Therefore, the Second Circuit affirmed the trial court’s judgment.

LITTLE CANADA, Minn. — Following the 11th Circuit’s panel decision in Hunstein v. Preferred Collection and Management Services, Inc., the Print & Mail Coalition (the “Coalition”) filed an amicus brief in support of the defendant’s petition for a rehearing en banc. The Coalition represents 12 independent businesses specializing in the production and delivery of printed and electronic collection communications.

The Coalition’s amicus brief addresses two oversights by the panel, which left uncorrected, would leave intact a significant misreading of the Fair Debt Collection Practices Act and eliminate the print and mail industry, and other service providers from servicing debt collectors. The issues raised by the Coalition are:

• Whether the panel erred by accepting, without consideration, the parties’ legal conclusion that Preferred engaged in a communication with CompuMail. The Coalition’s argument is that CompuMail is not a person under the statute, but a medium through which collectors convey debt information.

• Whether the panel decision overlooked Regulation F and the CFPB’s interpretation of the FDCPA as not prohibiting a debt collector’s use of a print and mail vendor.

The brief explains that the print and mail industry serves as an important communication conduit between businesses and consumers, and acts as an extension of operations for corporate America and the United States Postal Service. Additionally, the Coalition asserts that panel’s decision imposes significant harm to millions of consumers, who rely on written correspondence from debt collectors about their credit transactions, repayment obligations, their legal rights, and credit reporting consequences.

The deadline for amicus briefs to be filed is June 1, 2021. However, there is no specified date or timeline for the court to rule on the defendant’s request for rehearing or review of the amicus briefs.

With new Regulation F rules on consumer preference, the CFPB has given even more power to consumers to determine how creditors and agencies can communicate with them. But this trend towards customer-centric collections is not new. Many of us in accounts receivable saw this coming for at least a decade. It started with the internet and was greatly accelerated by the smartphone. Now we are asking ourselves where does it all end?  

The good news is there is an end in sight. The bad news? Many of you aren’t going to like it. 

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Best practices in collections strategy and consumer communication will not be determined by what creditors want collection agencies to do, or even what agencies want to do. It will be driven by consumers. Design and communications-obsessed tech companies have radically changed what consumers consider reasonable standards for and means of communication. And we as consumers, really customers, have used technology to change the way we do everything. Why would we think it would be different with debt collection? 

The CFPB Put the Customer in Charge 

The future of debt collection strategy is customer-driven collections. 

As if the writing on the wall was not clear enough, the Consumer Financial Protection Bureau codified this change when they published section 1006.14 of Regulation F. Section 1006.14 is mentioned 594 times in the new rule. While most may have been focused on section 14(b)(2) Telephone call frequencies; presumptions of compliance and violation, also known as the 7/7/7 rule, section 14(h) Prohibited communication media is what puts the power squarely in the customers’ hands when it comes to the way debt will be collected going forward. 

In connection with the collection of any debt, a debt collector must not communicate or attempt to communicate with a person through a medium of communication if the person has requested that the debt collector not use that medium to communicate with the person.

What does this mean? It means, like it or not, creditors and agencies need to adopt a customer-centric collections practice. The customer now has the right to tell you how they want you to communicate with them, whether it is via phone, email, text, letter, or any other channel. And they can even tell you when they want to be contacted by telling you specifically when not to contact them. See section 1006.6(b)(i). 

The Customer Wants Convenience and You Should Give It to Them 

What do we need to do? Besides making our systems and operations compliant with the new rule, we need to change the way we think about collecting debt from CUSTOMERS. We need to figure out how we can provide as many communication channels, or the ones customers really want like email and text, so that we can contact them and they can contact us in ways they consider convenient. We need to look at our hours of operations so we can respond when customers want to communicate with us (which can be done with a live person or in some cases a digital solution). We need to give customers clear information and options, the ability to calendar time with us, frictionless online solutions, especially payment portals, and their channel of choice.

Customer-Centric Collections Strategy Can Be Good for You and the Industry

The benefits for the customer are clear: control over how and when we communicate with them. They can demand – and get – the communication they want when they want it. Are there benefits for us, too? There are and they’re considerable. 

Companies that can meet this new standard for customer-determined, customer-driven communications will get lower customer complaints and lawsuits. This will lead to a reduction in internal work, reduced regulatory oversight, and lower litigation costs. We will get to see dramatically higher accounts per agent ratios as customers self-serve vs having to talk with a person. This means higher gross margins. 

Finally, we have the chance of changing the way debt collection is done and reducing the shame of being in debt. This means for the first time in our history, we may even be able to change the perception of debt collection itself. 

The race has already begun, and the companies that can meet their customer needs, dare I say delight their customers in helping them resolve their accounts, will be the ones successful in the decades to come. 

Tim Collins, Chief Customer Officer at InDebted, Le’nore Caldwell, Manager of Audit at Spring Oaks Capital, and Carrie Coker-Aivaliotis, Director of Market Planning at LexisNexis will discuss the future of consumer preference at iA Strategy & Tech, a digital briefing and networking event for creditor and agency executives in collections strategy – July 13-15. Learn more.

For several quick, easy ways to optimize consumer preference practices, try “5 Ways to Improve Your Consumer Communication Preference Strategy.” 

Want more collections strategy insight like this delivered right to your inbox? Sign up for the iA Strategy & Tech Newsletter.

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: