You are on the phone with a consumer. The conversation is going well. You have developed a nice rapport with the consumer and then he drops the bomb. He asks you if you could shoot him an e-mail explaining the payment plan. What’s a collector to do?
We’re going to explore that question here and try to develop a plan that will work, with the approval of collection supervisors, key top management, and of course your agency’s compliance attorney.
It really should come as no surprise that consumers are asking to communicate with debt collectors by way of e-mail with surprising frequency. It has also been a dream of debt collection agency owners to reduce their postage expense by communicating with consumers electronically rather than via first class mail. Fortunately, there is no legal reason why consumers and debt collectors cannot communicate by way of e-mail if the proper steps are taken to protect the consumer’s privacy, prevent unauthorized third party disclosure of the debt and obtain the consumer’s express consent.
Risk vs. Reward
As you consider whether to adopt an e-mail communication policy you must consider a number of risks. The most obvious risk presented by any e-mail communication with a consumer is the risk of violating the Fair Debt Collection Practice Act’s (FDCPA) prohibition against the unauthorized disclosure of the debt to a third party. Many consumers share their e-mail address with family members, roommates, friends and others who fall outside of the definition of a consumer under Section 805 of the FDCPA or state law.
Great care must be taken to obtain the consumer’s consent for you to send an e-mail to a particular address in light of this risk. Under no circumstances should you knowingly accept a consumer’s consent to communicate with them using an e-mail address associated with their place of employment or work. None of us, regardless of our intention or our willingness to grant consent, should have any expectation of privacy with regard to our workplace e-mail address.
State licensing and collection notice text requirements also present an inherent risk for the debt collector. In those states that require licensure as a condition of collecting consumer debt or require specific language on debt collection notices, debt collectors may fall victim to the highly mobile consumer who moves, vacations, works or visits a state where your agency is not licensed. Agencies that are not licensed nationally should take great care to include a provision in their e-mail consent form that addresses both the issue of licensure and state text requirements.
E-mail communications are writings and like all other written communications with consumers, must comply with state and federal law including the FDCPA, Fair Credit Reporting Act, the Gramm Leach Bliley Act, the Health Insurance Portability and Accountability Act (HIPAA) and the Electronic Signatures Act to name a few. Unlike paper letters, the content of an e-mail can be modified by others and altered such that the e-mail no longer complies with the law. This risk is very real for the unwary debt collector.
Before embarking on any plan to communicate with consumers by way of e-mail, agencies should work closely with their IT department to ensure copies of all e-mail communications are retained and retrievable for at least one year plus one month from the date the e-mail is sent to the consumer. This step is important in case the agency finds it necessary to provide evidence of compliance with applicable law at the time the e-mail was sent to the consumer.
12 Step Plan for E-Mail Communications
- Adopt an e-mail communication policy approved by legal counsel.
- Prepare an e-mail consent form you may mail to the consumer and/or prepare a web based consent form the consumer must click and agree to before he or she can proceed to authorize you to communicate by way of e-mail. Do not rely on verbal consent.
- Add a field to your collection screen that will allow you to record your receipt of consent to e-mail the consumer or design a program that will update the collection screen when the consumer consents to e-mail communications via your web site.
- Inform the consumer under no circumstances may the consumer use an e-mail address provided to them by their employer or related in any manner to their workplace or place of employment. There can be no expectation of privacy with respect to an e-mail associated in any way with one’s place of employment.
- Establish a standardized protocol for completing the From, To and Subject line of any e-mail to a consumer.
- Never include any language in an e-mail you would not include in a paper letter.
- Identify and train the employees who will have the authority to communicate with consumers by way of e-mail about the timing, format and the content of e-mail communications with consumers.
- Establish a data security and document retention policy for all e-mail communications.
- Reach out to the vendor community for assistance. I know of at least two vendors who are developing a secure, compliant e-mail communication platform for the industry.
- Use the E-Sign Act as a tool. It is a tool you may use to obtain consumer consent via electronic means. In short, this federal law ensures the execution of electronic documents and signatures have the same binding effect as their hard copy and handwritten counterparts if certain requirements are met.
- Embrace the use of secure e-mail platforms that are password protected.
- Standardize your e-mail communications as you standardize your letters and have them reviewed by your compliance counsel or a collection notice review attorney.
This article only touches on the many issues presented by e-mail communications with consumers. It is not a comprehensive statement of the law. The information cannot be considered legal advice nor can it be relied upon as legal advice. Please consult with your attorney about any questions you may have about an e-mail communication policy in your agency.