2013 was the year the federal government resolved to take serious action against bad actors in the debt collection industry. 2014 should be the year that everyone in ARM makes some New Year’s resolutions of their own to avoid pricey compliance headaches.
5. Don’t start slacking on your resolutions by February 1 like everyone else does. In fact, there’s a built-in deadline to keep the industry motivated. The CFPB’s comment period on its Advance Notice of Proposed Rulemaking ends February 16. At that point, the Bureau will sort through comments from collectors and consumers to decide next steps in how to regulate the industry. Right now, the most active discussions surrounding the ANPR deal with debt collection litigation and questions about the appropriate use of mobile technologies in debt collection. These are topics that debt collectors, buyers and lawyers have a wealth of knowledge on; they should be encouraged to speak up.
4. Watch your vendors like a hawk. The CFPB made it clear in 2013 that if a collection agency’s third-party vendor is out of line, then the agency itself may be held accountable for that vendor’s violation. No example of this was more clear than the consent order between JP Morgan Chase and the Office of the Comptroller of the Currency. The language of the consent order stands to have a massive ripple effect throughout the debt collection industry because it essentially creates a blueprint for dramatic oversight by banks over their collection agencies, lawyers and debt buyers. Learn more with our report, To the Point: The Chase Consent Order.
3. Keep up (some of) the good work. On November 6, the CFPB added 5,329 debt collection complaints to its consumer complaints database. Fortunately, of those complaints, 5071 consumers reported a timely response from the company; only 843 consumers disputed their resolution. And in 66.5 percent of cases, companies closed the consumer complaint with just an explanation. This high response rate, and the number of positive resolutions, shows the industry is on the right track for managing consumer complaints. In 2014, Collectors can use the data from the CFPB to make the process even more consumer-friendly.
2. Improve communication with consumers. When the CFPB added more than 5,000 debt collection complaints to its massive complaints database, nearly 20 percent of all those complaints fell under “communication tactics.” Of those 1,055 complaints, 659 consumers cited frequent or repeated calls; 90 complained about continuing to get calls even after they had filed a written cease of communication with the company.
1. Be proactive by attending our webinar. Collectors and vendors need to be proactive about tracking and responding to consumer complaints, because the CFPB is definitely tracking them! The data gives all participants in ARM critical clues about how the Bureau plans to regulate the debt collection industry, and its vendors, in the not-so-distant future. Join insideCompliance for an information-packed 60-minute webinar on Tuesday, January 7 at 2 p.m. Eastern. Learn how to analyze the CFPB data to improve your operation, bolster your complaint and compliance management systems, and respond to the ever growing number of consumer complaints against the debt collection industry.
What are some of your professional New Year’s resolutions? How can the debt collection industry be even stronger in 2014? Let us know what you think in the comments.