Collection Industry Process Serving Standards Now in Commenting Phase

In many ways, the collection industry waited too long, ignored the writing on the wall, and found itself under the glare of legislative scrutiny.

Would a set of recommended standards and best practices, ratified by the majority of the players and codified by the industry, have helped? If the collection industry had recognized itself as an interconnected group of players rather than lone operations, might the FDCPA, the TCPA, and any number of alphabet-soup-like pieces of legislation, offer more considerations for collectors in its language? Would the FDCPA even need to exist at all?

That was one of the hopes of the inaugural Process Serving Standards Summit, held last week in Denver, Colorado (9 – 11 July 2012).

The Summit is a historic endeavor: an industry recognizing that it, rather than external regulators, is in the best position to develop standards that not only protect players from lawsuits, but also guarantee compliance and improve transparency.

On Wednesday, 11 July, participants from across the process serving industry — from process servers themselves, to creditors and collection attorneys — read through and debated an initial draft of recommended process serving standards. Each suggested standard on the list was voted on — either “yes, we think this is a necessary standard” or “no, this isn’t” — and by the end of that day, the group had developed a document for wider dissemination to the process serving and collection industries as a whole.

There will be a 30-day comment period through 15 August, and then the Summit Advisory Board will review all comments received in order to revise and finalize the recommended standards.

Some of the next steps discussed at the summit include encouraging buy-in from the already existing state and national process serving associations; engaging with state legislators; and the creation of an association to help oversee the certification and compliance of these standards.

Below, you’ll find the current Recommended Process Serving Standards for the Collection Industry. Those interested in commenting  on these standards can do so via http://processservingstandards.com/Register.html; or by contacting Joel Rosenthal of JJL Process at (561) 312-7602 or joel.rosenthal@jjlprocess.com.

I. Compliance

A. GPS verified/time/date-stamped record of every attempt evidencing
the service location

B. Full description of the individual served or complete explanation
for non-service in return of service documents as required by the
jurisdiction

1. Full description should include first and last name and relationship and if name and/or relationship not given description that name and/or relationship was refused

C. Process Server must be the one signing the return, no one can sign
another’s return

1. If a notary is required, compliance with state law as to notary attestation is mandatory

2. Signatures on original affidavits need to be originals and cannot be images, no one can have imaged signatures of the process server so that there is no potential for misuse, with the exception of states where an e-signature process is permitted and is utilized within the law

D. Server compensation programs based on successful versus non-
successful serves should not be utilized

1. Success-based compensation systems provide opportunity for falsified affidavits of service

2. Individual process servers should be compensated by their process serving company at the same rate for successful serves and unsuccessful serves

E. Written compliance program

1. All process service companies should have a written compliance program

2. The compliance program should include penalties for non compliance up to and including termination

3. The compliance program should designate a Chief Compliance Officer who is responsible for implementing and managing the program

4. The written compliance program should document steps taken to ensure compliance with local, state, and federal laws

5. The written compliance program should be updated on regular basis by the Chief Compliance Officer

6. The written compliance program should be made available on-demand by the process service company’s clients

F. Procedure should be in place to keep abreast on court decisions and
new laws impacting process serving in the states where they operate

G. Company must maintain necessary corporate licensing, registrations,
bonding and insurance for every state where company operates

H. Monitoring of individual process servers for active state/county
licenses and bonding

1. As well as active driver’s licenses and automobile liability insurance

2. National criminal background checks going back at least seven years for new process servers with felony or any other crimes of moral turpitude convictions being a hiring disqualifier

a) National criminal background rechecking annually

I. The process serving company should maintain full transparency for
each client providing status information and all information regarding
active and inactive accounts

1. Copies of all service documents, images, server handwritten worksheets and GPS information should be available

J. Any sub-server company hired by the process serving companies
should be in compliance with these standards

1. Any time a sub-server is used for service, advance notice should be given to
the client

II. Internal and External Audits

A. Internal Audits

1. Regular internal auditing of process server activity and documents for completeness and accuracy

a) Feasibility scoring of the time between all service attempts to
identify unrealistic over-performance of their route

2. Cross-checking that all server attempts are within legal days and hours NO

3. Monitoring the results of each server’s attempts for unrealistic performance

B. External Audits

1. At any given time, without warning, clients may audit process serving companies either in person or remotely

2. Responses from process serving companies should be immediate as long as requests are reasonable

III. Process Server Education

A. Education program, including relevant creditor/collector regulations,
particularly for new servers (where no licensing or training is provided
by the licensing authorities)

B. Continuing education every two years (unless mandated by state)

IV. Engagement of Process Serving Companies

A. A mutually acceptable written contract should be in place between
process serving companies and each of their clients

1. The contract with each client should define the nature of the service relationship, the importance of confidentiality, service standards and time frames, service fees, parameters for record retention, the client’s right to audit, licensing requirements, indemnification of the client, data transmission security, sub-server requirements, payment and billing requirements, insurance requirements, and warranties.

V. Conflicts of Interest

A. Law firms or their partners should not have any ownership position
in the process serving companies that the law firm uses without full and
total disclosure to all of the law firm’s litigation clients

1. And family relatives (or spouses) of law firm partners (or spouses) should not have an ownership position in the process serving companies that the law firm uses without full and total disclosure to all of the law firm’s litigation clients.