Post on 13-Dec-2015
September 27, 2015Denver, Colorado
An Industry Perspective
2015 NACARA Annual
Conference
SpeakersDebra Ciskey
Compliance Officer, Wakefield and Associates
ACA International Board of Directors
David Cannella CEO, Credit Service Company, Inc.
Associated Collection Agencies, Inc. (CO, WY, NM Unit)
Andrew MaddenDirector State Government Affairs, ACA
International
• Education, Advocacy & Member Service
• Offices in Minneapolis and Washington, D.C. • Third-party collection agencies, law firms, asset buying
companies, creditors and vendor affiliates, representing more than 230,000 industry employees
• 40 State Units (50 states)
• One International Unit (60+ countries)
ACA International
Failure to Recover Consumer Debt
• Higher Taxes
• Government Budget Shortfalls
• Business Closures
• More Layoffs
• Higher Prices for Consumers
• Less Available Consumer Credit
Vital to Economic Health
Paid $2.6 Billion in
Taxes
Provided 136,110
Jobs
Recovered $55.2 Billion in 2013
Gave $130 Million in Charity
Third Party Debt Collection
http://www.acainternational.org/economicimpact.aspx
Economic Impact Study
• Conducted by Ernst and Young
• Surveys the Impact of Third-Party Debt Collection
• Get Your State and National Data
Taking Complaints Seriously
Debt collection is a consumer relations based industry.
Third-party consumer debt collectors make approximately one billion contacts to consumers per year.
The CFPB Annual Report on the Fair Debt Collection Practices Act (“FDCPA”) stated that 77 million individuals had a debt that was subject to the collections process in 2014
During that time, 88,300 complaints were filed with the Bureau regarding debt collectors.
Based on this data, in 2014, over 76.9 million Americans with debts in collections did not file complaints.
This means that the percentage of consumers who filed complaints with the Bureau was approximately one tenth of 1% of all consumers with debts in collections.
FCC Declaratory Ruling on the TCPA
In January 2014, ACA filed a Petition for Rulemaking with the FCC asking for clarification of the TCPA
Clarify that just because a predictive dialer CAN be an Automatic Telephone Dialing System, not every predictive dialer MUST be an ATDS covered by the TCPA
Confirm that “capacity” means the “present ability” of the dialing system
Prior express consent should attach to the person incurring a debt, not the wireless number
Establish a safe harbor for “wrong number” calls
FCC Ruling Highlights
Autodialers: “Capacity”
The capacity of an autodialer is not limited to its current configuration but includes its potential functionalities, i.e. its future ability to be modified to have the requisite capacity
All predictive dialers are categorically an ATDS, regardless of whether they possess the statutory elements at the time a call is made
Manual dialing raises concerns if the equipment that is being used to manually dial could theoretically be modified to be an ATDS
Consent: Reassigned Numbers
Interprets “called party” as the subscriber or customary user
Rejects the “intended recipient” approach
Callers now have a one attempt to gain actual or constructive knowledge of reassignment
ACA’s Response
On July 10, ACA International filed a suit in
the United States Court of Appeals for the
D.C. Circuit seeking judicial review of the
Federal Communications Commission’s
Declaratory Ruling and Order Adopted on
June 18 on the Telephone Communications
Protection Act.
Consumer Education
Ask Doctor Debt website launched in 2009
Target audience = general consumers
Content constantly reviewed to reflect changes in regulations and consumer needs
Re-brand scheduled for 2015/2016 www.askdoctordebt.org
Create the Online Consumer Debt Knowledge Center
Number of Percentage of Employees all U.S. ACA members
1 – 25……………..….……………….…..….77%
25 – 99 …………..…..………………………. 17%
100+ ……………………………...………….. 6%
Collection Agencies by size (ACA members only)
A Diverse Industry
Cost of Compliance
Can be directly related to the volume of consumer contacts and whether the agency is a
data furnisher.
Responding to direct disputes and eOscar disputes
FTE(s) to evaluate calls and provide feedback
Complaint investigation and responses
Policy maintenance
Development and distribution of training
Data analysis and reporting
Client interface and training
Complaint HandlingBetter Business Bureau data:
Debt collection ranks 5th in financial services for generating complaints
Dramatic decrease—11% from 2013 to 2014
Debt Collectors resolve 82% of complaints, compared to 78% for all other industries
Causes of Complaints(Unscientific)
No contact prior to credit reporting
Payment of debt did not result in credit deletion
“They call me every day, multiple times per day.”
Prior dispute with creditor
Escalated conversation with collector
CFPB Complaints
163,000 complaints since database started accepting debt collection complaints in 2012
Debt collectors have responded to 90% of complaints
60+ percent of consumers did not dispute responses of debt collectors
Complaints are not verified for accuracy nor indicative of wrongdoing.
The Complaint Process1. Complaint intake occurs: search for the account, secure it from
further treatment
2. Analyze allegations in complaint
3. Compare allegations to treatment history
4. Review all account activity, including collector notes
5. Review correspondence from consumer, if any
6. Review recorded phone calls, if any
7. Seek validation or further information from creditor
8. Determine best avenue to resolve consumer’s complaint
9. Compose response, send to regulator
10. Close loop on issue—depends on outcome of investigation
11. Track complaint and issues, include in next regular analysis
12. Communicate to Executives
Complaint Prevention
Compliance training, monitoring, and feedback
Customer service training and deescalating angry consumers
Positive feedback for well-executed calls, even if they did not result in payment
Resolution does not always = payment
Consumer Education
Provide consumers factual information about the credit reporting process
Make licensure information easier for consumers to locate on your website
Help consumers understand the Do Not Call registry, including that in your state if applicable
Opportunities If your office does not seek complaint responses
from debt collectors, maybe you should
It is in everyone’s best interest to resolve consumer complaints
Complaints give us the opportunity to confirm that our systematic processes are working, and discover processes that may be broken
Dialog with industry members is positive and constructive
Associated Collection Agencies
Established in 1923 A State Unit of ACA International Over 80 members representing Colorado, New Mexico
and Wyoming. We want to be resource for you (tours, meetings, open
dialogue…)
Economic impact of Colorado based
agencies
Returning Assets Gross Revenue: $1.6 B Commission: $303 M Net Revenue: $1.3 B
Providing Jobs Direct Jobs: 3,968 Total Jobs: 6,457
Making Payroll Direct Payroll: $225 M Total Payroll: $389 M
Paying Taxes Direct State / Local: $23.2 M Total Federal: $40.6 M
The Role of the Colorado Collection Agency Board
A 5-member advisory board appointed by the governor to provide advice to the Administrator of the Colorado Fair Debt Collection Practices Act. Members represent the third-party debt collection industry and the public.
The Industry welcomes the opportunity to be a resource.
Need for TCPA Reform
Questions?
Thank You