 In my last article, I wrote about dispute management and the expectations of the CFPB as expressed in a special Supervisory Highlights report issued in March 2017. This article will discuss the Bureau’s take on complaints as expressed in several documents including the CFPB annual report on the FDCPA, published in March 2017.
Remember when you were young, and you got into trouble for something that someone else did, and then blamed it on you? Whether it was your sibling, cousin or a classmate, someone wanted to avoid consequences by pointing the finger at you, an innocent bystander. This is what it feels like to collection industry members when CFPB complaint numbers are published. Obviously, someone feels wronged when he or she files a complaint with the CFPB. However, should the CFPB hold the third-party debt collection industry responsible for actions of others? Let’s look at some of the commentary, and you decide.
In its sixth annual report to Congress on the FDCPA, an 82-page report published in March 2017, the author provided an example of a complaint received in the debt collection category. Let’s remind ourselves that up until 2011, annual reports to Congress regarding the performance of the FDCPA were provided by the Federal Trade Commission, the federal agency charged with enforcement of the Act. The FTC did publish complaint numbers in its annual reports; however, the FTC did not have a process for sharing complaints with debt collection agencies and did not seek resolution of complaints. Complaints were used to drive the initiation of enforcement actions. When the CFPB was created and given enforcement authority under the FDCPA, it took over the annual reporting to Congress and includes complaint data and more in its annual report to Congress.
While the author of the March 2017 report acknowledges that the CFPB gathers complaints about third-party debt collectors as well as first-party collection attempts, that is, collection attempts by creditors collecting their own debts, the term collector or collectors is used more than 200 times in the report. Creditor is used fewer than 20 times. The report opens with Director Cordray’s remarks, which begins with the fact that, “2017 marks the fortieth anniversary of the enactment of the Fair Debt Collection Practices Act.” The scene is set for a report about the actions of third party debt collectors. Then why, on pages 17 and 18, would the author provide an example of a complaint about excessive calls that is obviously a complaint about the collection practices of a creditor? In the example, the caller to the consumer is reported to have said that the company could make up to six calls a day to the consumer, and if the consumer were to be taken off the call list without making payments, the account would go into collections. The example is followed by, “Consumers report that collectors contact them using alternative methods, in addition to telephone calls.”
Because consumers must identify the entity about which they are complaining, the CFPB has the data and could provide a breakdown of complaints. In fact, in a monthly Complaint Report published in December, 2016, the CFPB identifies the “Most-Complained-About Companies for Debt Collection” (page 17). Of the 20 companies listed, 13 are debt collectors and seven are creditors. While complaint data for these individual companies is provided, there is not analysis of total complaint numbers attributable to creditors. Creditors collecting their own debt in their own name are exempt from Fair Debt Collection Practices Act compliance, yet nearly all of the complaint allegations on the Consumer Response portal relate to acts and practices specifically prohibited by the FDCPA. These problems make the complaint numbers muddy.
Complaints filed by consumers are not validated in any way by the CFPB. When is a complaint truly a complaint? The CFPB considers any expression of dissatisfaction by a consumer to be a complaint. Conversation after conversation that I have with industry members about the complaints submitted to them on the CFPB’s portal indicate to me that many consumers are using the portal merely to request validation of a debt or invoke other self-help remedies, such as to request that the debt collector cease communication. They copy and paste the same downloaded dispute letters that we all receive in the mail every day. Certainly, if a consumer feels wronged by the actions of a debt collector, a complaint may be warranted. However, complaints about calls that were never made and threats that never occurred skew the complaint data to the point of meaninglessness.
What does this mean to you? Keep your own data on the complaints you receive. Analyze them. Determine if they are an indicator of changes that need to be implemented in your processes. Is your IVR messed up? Do you have enough staff to handle all your inbound calls during busy times? What training do your collectors need to help prevent complaints? Are you responding to disputes fully, and in a timely way? The main value of complaints comes from their content and the resulting investigations we conduct before making our response. We are unlikely to see an end to the Consumer Response portal, so let’s use those lemons to make lemonade and help us to succeed in our efforts to turn attention to the actual culprits.
Debra Ciskey is the Compliance Officer at Wakefield & Associates. Inc. She is a member of the board of directors and a certified instructor for ACA International.
|
 This will be our sixth and final article in the series related to what is commonly referred to as the “the invisible web.” As I previously stated and again emphasize, these sites are certainly not your beginner or skip guesser sites. Most of them require certain advanced skills to manipulate, massage and extract the data. For the professional tracer to obtain the desired information needed to complete their searches it is imperative that they possess the required skills and a thorough understanding of “exact data extraction techniques.” I have visited and conducted searches on each of these sites to insure they are working and functional as of July 14, 2017.
To briefly refresh our memory, in the past five installments we have been reviewing the vast amount of data search engines usually will not show you without a specific search. The term “invisible web” mainly refers to the vast repository of information that search engines and directories do not have direct access to, such as databases. Unlike pages on the visible web (that is, the Web you can access from search engines and directories), information in databases is generally inaccessible to the software spiders and crawlers that create search engine indexes. It is estimated that the invisible web is thousands of times larger than the visible web content. The invisible web contains nearly 550 billion individual documents compared to the one billion of the visible web.
The major search engines do not bring back all the “hidden” content in a typical search, simply because they can’t see that content without specialized search parameters and/or search expertise. When a tracer knows how to access this data they are provided with much more information.
Many tracers are not aware of the invisible web and therefore are limited to what can be found with common search engines such as Google or Yahoo. There are times when a tracer looking for something a bit complicated or obscure cannot find that bit of data they are searching for with a common search engine. The professional tracer understands the invisible web is the place they must access to obtain critical data.
I have found that most of the data on the invisible web is maintained by academic institutions, and has a higher quality than search engine results. There are “academic gateways” that can help you find this information. To find nearly any educational resource on the Web, simply type in this search string to your favorite search engine: site:.edu “subject I’m looking for” and in most cases your search will return with only .edurelated sites.
The invisible web offers a vast array of resources to the professional tracer on just about anything and everything. The links we have covered in the previous five issues barely begin to touch the total resources available on the invisible web. The invisible web continues to grow at an unprecedented pace and utilization by the tracer becomes a great asset.
Finally, it is important to clarify that the invisible web is also an entity on the move. For example, a site that is not accessible via Google today can be included by the search engine tomorrow when Google’s spider visits the site. But it is also possible that if the whole site or certain pages are accessible only after registration (even if it is free), the site will never appear on Google. Like grains of sand in the desert, they are always there but may be constantly shifting in fashion and form.
Here is a list of some of the most popular searchable sites and search engines for the invisible web and although some of them provide additional metasearch options for searching with five, 10 or even more search engines, each of these has its own indexing capabilities for invisible web pages.
Direct Search
http://www.directsearch.net is considered one of the biggest and most intensively maintained resources for the invisible web. It is not only a search engine, but also a search directory with links in many categories. One of its advantages is the topical compilations, which are gatherings of links connected to a specific topic — for instance, Almanacs/Factbooks/Statistical Reports and Related Reference Tools.
QueryScoop
http://www.queryscoop. com/ is a multi-search three-step search tool which allows the user to search with multiple search engines including Google, Bing, Yahoo and DuckDuck- Go. It is very easy to use and covers any subject for which you desire to search using keywords.
The Invisible Web
Livewire-47 Alternatives to Wikipedia www.lifewire.com/ alternatives-to-wikipedia-3482764 is a valuable resource for the invisible web because it provides links to over 70,000 searchable databases and specialty search engines. The trick with dynamic searchable databases is that they are more difficult to crawl. Because of this, they are rarely indexed by major search engines. When a search for a term is performed, it is submitted to multiple databases simultaneously, so in a sense this is also a metasearch engine.
Geniusfind
http://www.geniusfind. com/ is similar to the now defunct Complete Planet in that it is a database and search engine finder. Although it does not have the rich resources of the other search engines, Geniusfind offers topical search engines and databases. It can be used to locate an engine or a database for a topic of interest, which a searcher can use to perform an additional search.
The all-purpose search engines for the invisible web can be used to directly find the information in which you are interested. But often it is faster and easier to use an all-purpose search engine to locate a topical search engine or a database. After you find search engines or databases on topics of interest, you can go to the site to see whether they provide the information you need. There are search engines and searchable databases for almost any topic imaginable.
I could list many other invisible web databases, but I think that after providing you with ideas about how to find them, you can make your own list based on your specific needs, so let the hunt begin! Good luck and good hunting until we meet again.
Ron Brown is a member of the National Association of Fraud Investigators and the author of “MANHUNT: The Book.” Contact him at rbrown2150@aol.com.
|
 How solid is your relationship with your client base? Do you feel secure that you know all the players in the management team of some of your largest and most profitable clients? Can you successfully reach the CFO or CEO or anyone at the C level within the organization? If the answer is “no” then you have a lot of strategic work to do!
Over the years, I have heard many laments by agency owners relative to the unexpected loss of significant clients through the decision of someone they didn’t even know in the organization. The fact that you have great liquidations and an 18-year relationship doesn’t really seal the deal in today’s market. The best way to guarantee the continuation of important business relationships is to know all the players, which dictates that your entire office team must have a critical role. Without this relationship strategizing you run the risk of “here today and gone tomorrow.” This takes precious time we often don’t have. But as expressed in an African proverb, “If you want to go fast go alone. If you want to go far, go with others.”
One way to start this process is to assess your contacts within every significant client’s operation. With whom does your staff communicate? How often? Have positions changed? To whom do the people you know report? Are positions solid or are interim consultants running part of the organization? But how do we, from a practical perspective, reach out and penetrate the creditor work force?
Typically, we mirror contacts and relationships between our office and a client’s team. Our front-line staff engages with front liners. Our supervisors deal with supervisory staff. C-level management in your firm is responsible for developing that level of relationship. The challenge is to be sure each level gets adequate attention and a true, deep relationship is developed.
The front line staff often communicates daily. There are exchanges of reports, discussions relative to specific account dynamics and open dialogue. As regular as these communications may be, it is not uncommon for this level of staffing to never have personally met. The mid-level, supervisory staff may communicate less frequently but will sift through larger issues surrounding the overall relationship between the organizations.
Unfortunately, it is at the C-level of our organizations where the relationship development may be lacking. There is a reliance on the front line and mid-level development which often is very solid. We must develop plans and methods to spread our contact organization-wide. But what can we do?
Marketing Gifts
The gift of pens, water bottles, sticky notes and utility bags with your logo are nice ways to keep clients happy. They use your tokens of appreciation regularly and continually see your name.
Newsletters
Newsletters, whether in a paper or electronic format, are a great way to inform clients about all levels of activity within your organization. Highlight staff member milestones, accomplishments, charity work and corporate achievements. Recently, some of my industry friends were awarded Inside ARM’s “Best Places to Work” designation. That is the type of thing you need to tell your clients about! And, be sure you send these publications to as many players in the client space as possible.
Industry Trade Association Meetings
An active presence at meetings sponsored by various industry trade groups is a good way to interact with the mid to upper-level client staff. It also exhibits your interest and knowledge in that industry. As an example, in the medical industry, you will find patient account managers and directors attending American Association of Healthcare Administrative Management meetings, but if you want to interact with the C-level staff you would want to attend Healthcare Financial Management Association meetings for the CFOs.
Support of Client Sponsored Charity Events
One successful method to engage with the upper echelon within the creditor setting is to corporately support charity events sponsored by your client. At this level, agency management should be at the forefront of the donations and event assistance. Sponsor a hole at a golf tournament and send a team to participate. Write a check for a capital campaign for a new wing at the hospital. Donate a truckload of gifts over the holidays to the credit union’s initiatives to help indigent local families. This kind of activity can go a long way and the C-level management will certainly take notice.
Showing interest in your client above and beyond the collection contract will do more for your retention of that client than most other dynamics.
Forge a pathway of unique communication and sincere interest in those firms that you represent. Engage in such a manner that all levels of staffing simply couldn’t forget about the depth and breadth of the relationship they have with your organization. As Ralph Waldo Emerson stated, “Do not go where the path may lead, go instead where there is no path and leave a trail.”
And with that, I leave you with best wishes for happy trails that lead to good client relationships, solid business retention and successful collection programs that will continue for years to come.
We encourage our readers to submit a “best practice” idea for inclusion in this column. Until next time, I’m in a collection office near you!
Harry A. Strausser III is the President of Interact Training and Development. He can be reached at harrystrausser@gmail.com.
|
 With baseball back in full swing here in 2017, there has to be an article devoted to my Cubbies’ World Series victory and the debt collection world.
By way of background, I am a lifelong Chicagoan: born and raised. For nearly as long, I have been a devout Cubs fan. In fact, I distinctly recall taking the local bus to the ”L” train which stopped a block from Wrigley field… at age 10! For reasons I can’t fathom, my wife did not allow my daughters to make the same trip. This love of the Cubs carried over into adulthood where my first law office was walking distance from Wrigley and I purchased season tickets way before my firm was making enough money to really afford them.
Last season was truly amazing. To a certain extent, I am still surprised they actually won despite having traveled to Cleveland and being a witness to history. I know you’re asking, “what does this have to do with collections?” Well, to my mind, there are lots of similarities between my Cubbies and the collection world of today.
The biggest similarity was the recognition that there was a need for a total makeover of the Cubs. As one of his first actions, General Manager Theo Epstein created a blueprint that set forth the plan by which the new Cubs would operate. Epstein created a document called The Cubs Way in an effort to change the culture in Chicago from what had been done in the past – going for the big free agent splash, putting off rebuilding from the ground-up in favor of another stop gap measure. This was not going to happen anymore. And it was not simply a makeover of the stadium for cosmetic reasons, this was change from the ground up – in attitude, in strategy and in environment.
Does that sound familiar? Look at the world of collections today and recall what our policies and procedures looked like five or 10 years ago? The Cubs made the decision themselves to remake their team whereas the impetus for the collections world was negative forces from without – Dodd-Frank, the CFPB and a massive regulatory scheme imposed on our clients and by extension, ourselves.
But as a Cubs fan, I am an optimist. That means you can look at the troubles of today and see hope for the future. In today’s environment, the time may be right for Epstein’s total make over to take place. In my mind, the first place to start is the four-decades-old FDCPA. Created in a time where there was limited regulation and even more limited technology, it simply is out of date regarding the methodology of collections, means of communication and does not reflect the professionalism that is so prevalent in our industry.
The main problem Epstein saw was that the Cubs were in a desperate need for a cultural overhaul. Specifically, they needed players with the winning mindset. They needed to shed “the loveable loser” mantra and become something new. For our part, in many ways, I see that same change is needed in collections. Collections was never glamorous, but in recent years, thanks to the political environment, we have become almost vilified. Regulators and judges only know what they read and see in the media, which almost always paints an unfair picture based on the actions of a single bad actor. They do not account for the amount of care we take to get things right to protect consumers.
Yet, despite knowing what we do and how many of us do it right, hundreds of times a day, every day, I not only still find many people who have this old school mindset about debt collections who have a bunker mentality, and let that mentality control their decision making. To be clear, I’m certainly not saying we’re perfect, but the changes our industry has made over the past five years has been extraordinary and do us credit.
The Cubs created a plan and took risks, for example, trading their best prospect for Aroldis Chapman despite knowing he would only be a “rent a player” in order to win now! Likewise, we cannot be afraid to make decisions to move the business forward. We need to take advantage of this favorable political atmosphere to move regulation and legislation forward to reflect the real world of collections. We may not get all we want, but a dialogue has to begin.
Thus far, it has been a one-sided monologue of consent decrees and admonishments. It is time to get a conversation going. Look at your business – what good things are you doing? Are you advertising that to the clients or are you in bunker mentality? Do you have a state creditor’s bar association? If not, why not? If you do, what is that association doing to be an agent of change in your state legislature? Are you involved in NARCA? Are you watching from the sidelines or connecting with your Congressperson or Senator to help NARCA’s efforts to change the FDCPA. We have always been professionals and now we have the data to prove it thanks to all these audits. I am confident we are well ahead of Joe Maddon’s advice for the 2016 Cubs – “Just try not to suck.” Let’s do what the Cubs did and show the world how good we are.
Fred N. Blitt, Esq., is a partner with Blitt and Gaines, PC in Illinois and Couch, Conville and Blitt in Louisiana. He is past president of NARCA.
|
 What's left to say; question so many debt collectors are asking themselves these days. Far too often debt collectors are being told to stop saying certain words, using certain phrases, or watch how the tone of your voice is sounds. There is an ongoing trend of limitation of what debt collectors say that seems to be growing in momentum. I have always been a believer of if a debt collector is told they can’t do something, they must be given a couple things they can do. Nowadays that belief seems to be a distant memory as we try and determine what’s left to say.
Over the last decade we have seen a continuous constrictive trend in compliance for debt collectors during their conversations with consumers. Up until many years ago, what was said to the consumer was the norm as long as it stayed in compliance with the Fair Debt Collection Practices Act. Later on, in addition to FDCPA compliance, the compliance trend moved to ensuring debt collectors remained professional and respectful throughout the entirety of the conversation with the consumer even though many conversations become somewhat confrontational due to consumers being upset about their own financial hardship. Over the last couple years, a major emphasis was placed on the tone of voice collectors used when talking to a consumer and ultimately, remaining in line with a complete customer service approach. With all of that said, we are now seeing the manifestation of what I call “subjective compliance.”
For me, subjective compliance refers to an individual’s own perception or expectation of what may or may not be said. This has put debt collectors, their managers and agency owners in a very uncomfortable and compromising predicament. Debt collectors can be completely compliant with all federal and state laws, company policies and procedures, as well as use an appropriate tone of voice and approach each call with a customer service centric focus. However, now debt collectors may have every single word they use scrutinized by the subjective thought of the compliance individual listening, rather than an objective set of principles and clearly defined expectations.
The reality is no position in the debt collection industry has a more difficult and demanding job than the debt collector. This trend of “subjective compliance” has now made it even harder. Unfortunately, debt collectors have lost focus on their main purpose, which is to speak with consumers and work out a resolution to a difficult situation. Debt collectors are now trained more than ever on how to speak with a consumer while remaining compliant with all debt collection related laws. Their main focus these days is worrying about whether or not they are saying the right thing or speaking in the right tone of voice so they don’t lose their job. Some restrictions and even unspoken compliance expectations are so heavily placed on debt collectors they no longer worry about if they lose their job after a hard day’s work, they worry about whether they are going to lose their job after every phone call they make. That is simply not right and no way to run a business.
How an organization monitors and implements their compliance structure is completely up to them. But successful organizations and partnerships outline clear and objective expectations for debt collectors to be held accountable. Clear expectations have to be within reality as well. Some tend to forget that debt collectors are actually human. Therefore they set their expectations for robots who fail to think for themselves. The fact of the matter is even robots malfunction at some point. I personally think that until someone has actually spent time collecting a debt on the collection floor, especially in our current collection environment, they shouldn’t have a say in any compliance expectations.
Rather than focusing compliance objectives on everything debt collectors can say, the tendency is to focus on everything they can’t say. This route is chosen simply because even those within a compliance role are not sure what debt collectors can say anymore. They have relegated to the “subjective compliance” measure to try and proactively create a catch-all in order to cover themselves in case something ever comes about; not taking the time to take into consideration the unintended consequences. I get it, organizations are so afraid of getting a complaint or lawsuit filed against them they must make decisions they feel will protect their organization and fail to look at the decision in its entirety. We are collecting debt and from a compliance perspective we must always remember three things: 1) we are calling to speak with someone who is more than likely not expecting our call, 2) we are calling to speak with someone who has or is experiencing a financial hardship and is under difficult circumstances, and 3) we are most likely calling someone who does not want to speak to us.
Don’t get me wrong for a second, I believe on every single phone call a collector must be professional, respectful and remain compliant with all debt collection related laws, company policies and procedures. Further I believe there should be clear and realistic expectations set for debt collectors that if not followed have consequences. What I also believe is debt collectors have an extremely difficult job in which the complexity changes constantly based on the fluidity of regulatory opinions, legislative changes, court case decisions and compliance reviews. I think those who take the subjective compliance approach when determining compliance violations should reconsider and take a look at the big picture. It is very important organizations work together as partners in developing the objective expectations of compliance during the collection process and ensure those expectations do not change on a whim or are ever unclear.
Nick Jarman is the Senior Vice President of Diversified Consultants, Inc. Jarman served the last three years on the Board of Directors for ACA International and is the past President of the Missouri Collectors Association.
|
 Many are concerned that our nation is heading in the direction of another financial crisis. Almost 10 years since the great recession involving sub-prime mortgage loans, we could be facing another collapse due to the excessive amount of student loan debt affecting over 44 million Americans owing more than $1.4 trillion. That’s about $620 billion more than the total U.S. credit card debt and it’s getting worse with over 3,000 student loans going into default every day. Former students with and without a degree have become distressed borrowers needing assistance. The accounts receivable management profession plays a vital role in helping these borrowers resolve their unpaid debt. While both federal and private student loans offer high volume, consistent placements and larger average size balances, there are many differences between the two. Today we discuss some of the differences and our collection approach for each product.
In most cases the student doesn’t have credit history in order to qualify for the loan on their own. Often their parent or grandparent will cosign for the loan. Initially I attempt to reach the former student in an effort to set up a repayment plan. Once I make contact I set the tone by demanding the balance. After I have the borrowers attention I then update their full and complete information. The demographics I update are: the mailing address, phone numbers and, most importantly, their place of employment. I always avoid yes and no questions and ask less important questions that lead into the main question I want to ask. For example, I ask if they are working full time or part time. I then ask what their occupation is and for whom they work? By starting with non-invasive questions the borrower becomes comfortable and you lead them to the answer you desire.
If I get the runaround from the borrower or if they do not have the ability to pay, I head straight to the co-borrower. Even though the co-borrower signed their guarantee they really don’t want to pay for the loan. They have their own expenses and did not expect for the loan they guaranteed to go into default. It’s our job to educate the co-borrower and advise them why it’s important for them to accept responsibility and repay the loan. Once the borrower or co-borrower has agreed to pay, setting them up on a secured arrangement is of the utmost importance. When demanding payment I give them the options that are best suited to resolve the account. I advise them that we can set the arrangement up via checking or savings and ask which option is best for them. If they claim to not have their checkbook I advise them that I can get the routing number so long as they know their account number. If they claim to not know their account number I immediately respond saying, “that’s okay, we can make an exception and set it up via debit card. Go ahead with your card number as soon as you’re ready.” I have found success with the aforementioned collection approach for all types of debt throughout my career.
Federal loans offer income-based payment plans so collectors are able to offer various options to the borrower. Unlike private loans the statute of limitations doesn’t apply and many of the loans are non-dischargeable in bankruptcy. Federal loans can also be recovered by seizing income such as disability or tax refunds without having to take the borrower to court.
Private loans do not have as much flexibility when it comes to repayment plans. To make things even more difficult, the borrower could be under the impression that they already have an arrangement to repay the debt. This happens when the federal collector offers an arrangement that is all-encompassing. Unfortunately for the borrower the “all-encompassing” arrangement does not include their private lenders. If collectors are unable to resolve the loan on a voluntary basis with the borrower, private lenders may have to take the borrower to court and get a money judgment in order to use garnishment as a way of collecting. Once a judgment is in place the lender can also force liens on the borrowers’ assets. This approach may be necessary as private student loans are subject to the statute of limitations.
Sam Eidson is the Director of Compliance for Delta Outsource Group, Inc. He also serves as Secretary for the Missouri Collectors Association.
|
|
|
|
|
|
|
|
