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ACA Adopts New Code of Ethics for Collection Industry
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July 26, 2007

ACA Adopts New Code of Ethics for Collection Industry

In advance of the organization's annual convention, ACA International approved an updated and expanded Code of Ethics for collection agencies in the U.S. Notably, the ACA proposes the addition of a specific point-person to deal with consumer complaint in each individual agency.

The board of directors for ACA International, the Association of Credit and Collection Professionals, (ACA) Wednesday unanimously approved an enhanced association code of ethics. The vote occurred during the Annual ACA Board Meeting, held in conjunction with the association's 68th Annual Convention & Exposition, at the Hyatt Regency Chicago hotel, Chicago.

ACA's 5,500 members representing 125,000 professionals in the United States, Canada and 60 other countries worldwide, will now be held to higher standards of conduct as they provide a vital economic impact. Under the significantly modified code, the industry has committed to several provisions that balance the needs of the public with the responsibilities of ethical credit and collection professionals.

Key provisions of the code include:

* Requiring members to designate a contact
person at each member company to resolve
consumer complaints.
* Requiring members to make efforts to
resolve consumer complaints.
* Clarifying the responsibilities of the
collector when consumers request
information about their debt.
* Forbidding litigation on time-barred debts.
* Clarifying the need for members to obtain
accurate and complete information about
any accounts being purchased.
* Adopting reasonable procedures for
investigating claims of identity theft.

“Today's decision is a milestone for ACA and the millions of creditor businesses we serve,” said ACA President Michael Shoop. “It's the latest example of our strong commitment to professionalism and fair practices. ACA supported passage of the Fair Debt Collection Practices Act in 1977, fought to bring collection attorneys within the confines of the law in 1986, and earlier this year introduced guidelines to help collectors and purchasers of health care debt align their practices with the care-driven mission of their health care provider clients. The updated code of ethics strengthens our platform of balancing consumers' rights and collectors' responsibilities.”

ACA chief executive Gary Rippentrop added the code of ethics will help creditors select an agent that will represent them professionally. “We stand firm in our belief that those who collect debt ethically and respectfully should not be placed at a competitive disadvantage to the few who don't. ACA encourages all businesses and organizations that retain collection agencies to seriously evaluate potential firms based on this code of conduct.”

How ACA's new Code of Ethics promotes the interests of consumers

Complaint Resolution Officer: ACA is negotiating additional “teeth” to the code of ethics as a meaningful alternative for consumers to resolve complaints. The first step in the process is accomplished by mandating all ACA member companies designate an officer with sufficient authority to handle consumer complaints. Companies will provide an updated contact each year as a part of their membership renewal.

Verification: Under the Fair Debt Collection Practices Act (FDCPA), a consumer has 30 days to request, in writing, debt verification from a third-party collector. Upon receipt of such a request, all collection activity must cease until the collector provides the consumer with documentation the debt is owed. The new code extends indefinitely the consumer's right to request verification in writing.

Additionally, the law does not require the collector to take any further action if it closes an account it cannot verify. Many consumers are left ill at ease when they hear nothing back regarding their verification request. With the new code, ACA seeks to add a step to the debt verification process requiring collectors to provide consumers notice that collection activity has ceased. This provision was added to the code in the interests of consumers, but lest such notice be interpreted as a violation of the FDCPA's “cease communication” rule, the provision will only become effective upon ACA's receipt of a formal advisory opinion from the Federal Trade Commission addressing a collector's ability to provide this notice.

The new code also requires collectors to indicate, when the account is closed and returned to the creditor, that the reason for closure was the collector's inability to verify the debt. This should allow the creditor or debt buyer to prevent the account from being sold or reassigned.

Time-Barred Debt: The statutes of limitation on consumer debts vary widely from state to state but are generally, four to ten years. ACA members consider the filing of a lawsuit on a time-barred debt to be an abusive practice and commit to use legal collection remedies only when appropriate to satisfy a debt.

Chain of Title: Creditors increasingly opt to sell non-performing debts to buyers to improve cash flow and recovery. Selling debt is an important tool for managing receivables. To curtail the reassignment or resale of disputed debts and to prevent wrong-party contacts, ACA encourages debt buyers to obtain supporting documents and establish the chain of title for any accounts they purchase.

Identity Theft: ACA members seek to communicate with only those consumers who are legally obligated to pay their past-due debts. Wrong-party contacts and victims of identity theft need protection from unwarranted collection activity. To that end, the enhanced code requires members of ACA to conduct a reasonable investigation to determine the validity of the debt and the identity of the obliger when claims of identity theft are communicated by the consumer.

While the FDCPA's consumer protections apply only within the United States, ACA extends the Act and its more stringent code of ethics to all 5,500 members worldwide.

A task force of ACA members appointed by the association's executive officers drafted the new code. ACA published the draft for a month-long comment period following which the association incorporated public feedback on the proposed changes.

By adopting the new standards, ACA members have publicly embraced self regulation, taken meaningful steps to preserve and foster the vitality of the industry and, most important, have set themselves apart as professionals committed to treating all consumers with dignity and respect.

The complete ACA Code of Ethics document can be accessed on-line at http://www.acainternational.org/images/10758/acacodeofethics.pdf.

....Inside A.R.M.

     
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Debt Collection Agencies = Debt Collection Agents
By -

For every debt collector whom I have spoken to over the phone seems to take a personal interest in why I can't pay, or just gets mad when I can't pay right then. I do not think they should get bonuses for getting a consumer to pay over the phone, nor should any reward be given. At times I sense that if they can lock in a date & over the phone payment then they are more nice, but if I can not pay over the phone (most) of them give me attitude. I am understanding in the aspects of we are all humane no one is perfect I know every job has its bad customers who try to lie, cheat or steal (get things for free). Why should debt collectors be able to get online and gripe about the people who won't pay the money they owe?
Shouldn't they get to know the people & understand every financial end before saying nasty things about ALL people who owe money. I have learned that playing fair and trying to pay bills on time the way they want it won't always work out the way I need it to. So I am doing the next best thing & sending my payments in by mail, or setting up payments that day if I know the money is in my bank account. I don't judge every debt collection agent by the way the last one treated me, but I sure do learn what can happen & what to do when I'm degraded by one. This has got to stop at some point for real if everyone worried about taking care of their own business and doing a job they get paid to do, right. Maybe more things would get fixed faster & easier but embarrassing someone is never the answer. And NEVER back anyone up in a corner because at that point you make them feel stuck, & not even try. Shouldn't collection agencies be teaching agents that if we can really try helping a consumer pay off this debt than we will get paid as well! And yes, I am sorry for all agents who deal with deadbeats daily remember they might have had too many bad experiences in the past. Not everyone will be nice or honest but cut the real guys some slack PLEASE!! Remember without ppl who owe money there wouldn't be a need for debt collection agents at all.
Guess that's all for now, tks

     
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FCC: Collectors May Call Cell Phones with Autodialers, Prerecorded Messages
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FCC: Collectors May Call Cell Phones with Autodialers, Prerecorded Messages
January 7, 2008

A ruling released by the FCC late Friday allows debt collectors to use predictive auto-dialers and prerecorded messages in calls placed to consumer mobile phones.

Collectors may use predictive auto-dialers and prerecorded calls to contact consumers on their mobile phones, the Federal Communications Commission announced in a ruling handed down late Friday.

Prior to this ruling, the Telephone Consumer Protection Act (TCPA) had generally prohibited auto-dialer and prerecorded calls to a mobile phone unless there was prior consent by the consumer. The ruling goes into effect immediately and applies to collectors, debt purchasers, and creditors, according to collection industry trade group ACA International.

The decision is being viewed as a victory for collectors and the ACA as more consumers move to wireless-only communication. “This is wonderful news. The TCPA was instituted when there were about 50 cell phones in the country,” said Gary E. Wood, president of Collins Financial Services Inc. and debt purchasing trade association DBA International.

“This ends a tremendous amount of litigation over auto-dialer prohibition,” said Rozanne M. Andersen, executive vice president and general counsel at ACA. But Andersen cautioned, “This is not a 100 percent win, there are some remaining questions. But we are analyzing the ruling and providing members with details to ensure they abide by the ruling.”

Indeed, an attorney with a consumer rights organization noted that the creditor, debt purchaser and collector still have the burden of holding, or having access to, a record of the debtor's proof of permission.

And keep in mind that “cell phone numbers turn over quickly. (An agency) may call the wrong person,” said Lauren K. Saunders, managing attorney of the National Consumer Law Center. “They need to ensure the number is still good for the right person.”

In addition, the FCC ruling applies only to the TCPA, not the FDCPA, and a collector could mistakenly violate one of its provisions if he isn't careful, she said. “There are a lot of landmines that collectors could step on if they use this for broad-based permission,” said Saunders.

In the ruling, reached on Dec. 28, the FCC determined that autodialed and prerecorded calls made to wireless numbers provided by the called party in connection with an existing debt are made with the “express prior consent” by the called party.

ACA filed a petition with the FCC in October 2005 seeking clarification that the prohibition against autodialed or prerecorded calls to wireless telephone numbers did not apply to collection calls. The FCC ruling was a direct response to the ACA petition.

At issue was the “express prior consent” clause in the TCPA governing the use of wireless numbers. Due to the fee applied to users for incoming mobile calls, the TCPA had been previously interpreted as not granting consent for automated calls.

Providing a creditor with a cell phone number during a credit application “reasonably evidences prior express consent by the cell phone subscriber to be contacted at that number regarding the debt,” the FCC wrote. Collectors may also use the mobile numbers if a consumer gives the number as an alternate contact.

Debt collectors have always been able to use predictive auto-dialers and rerecorded messages to reach traditional wire line numbers, and collectors have also been able to manually dial wireless numbers to reach consumers. But the combination of using those advanced call center technologies on wireless numbers was interpreted as forbidden under the TCPA.

In 2003, the FCC banned the use of auto-dialers and prerecorded messages for calls of any kind made to wireless numbers. The Commission was responding to what it called a “greater nuisance and invasion of privacy than live solicitation calls” in using wireless numbers which were gaining popularity. The fact that consumers were charged for the incoming calls punctuated the FCC's finding.

Information as Reported in insideARM

     
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What a collector can see
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Someone asked on a post a while ago what a collector can see on their screen. My post was a little late and the info was buried. So I am posting this as a new entry. I work on a pre-charge off collection for a credit card company.

I can see the: cardholder's name, address, phone number, place of employment (if given), their SSN, their balance (including how far they are over the credit limit, how much it would take to get the account out of collections), the date the card was opened, date of last payment, date of last purchase and cash advance. That is on the main screen. I can also pull one of 3 credit bureaus (Experian, Transunion or Equifax) as needed.

Those are purely the basics of what I can see. Different companies might have different information

     
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Take Back Your Phone Day / January 31st.
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Consumer Group Touts 'Take Back Your Phone Day' Against Collectors

A debt couseling firm has declared January 31st "Take Back Your Phone Day" in direct reference to collection calls. We here at insideARM.com recommend reading the following with a salt lick rather than the proverbial grain of salt.
January 25, 2007
Following in the proud tradition of "Take Back the Night" comes "Take Back Your Phone Day." Because nothing's better than a self-righteous uninformed debtor with a cause and a sense of entitlement. We here at insideARM.com recommend reading the following with a salt lick rather than the proverbial grain of salt.

With almost 20 percent of the FTC's (Federal Trade Commission) consumer complaints directed at collection agencies, Franklin Debt Relief CEO Robert Zangrilli has declared January 31st "Take Back Your Phone Day" for consumers getting harassed by collections agencies. Franklin Debt Relief is offering free advice and form letters for consumers getting unfairly harassed by debt collectors. Zangrilli came up with the idea after helping his father to combat nasty collections calls targeting his daughter, who is currently disabled and past due on bills.

"They called and my Dad explained the situation and even mentioned that my sister no longer lives at that address. Still the calls and insults persisted. Finally I faxed the collections agency a letter demanding that they cease communication on behalf of my Father and sister, which has stopped the calls, but I'm informed about the laws because of the industry I'm in. For consumers who are not aware of the laws, they endure daily harassing phone calls for no reason. Most people want to pay their bills and are forced to fall behind due to unforeseen financial hardship like unemployment or medical issues, as is the case with my sister. In other cases, debt collectors are hounding consumers for debts they don't even owe."

In addition to the numerous complaints filed with the FTC, the collections industry typically ranks in the top ten for consumer complaints with the Better Business Bureau (BBB). Fortunately for consumers, the debt collection industry is bound by a set of strict federal regulations under the Fair Debt Collections Practices Act (FDCPA) that dictates what they can and cannot do when pursuing a past due debt. One downside, however, is most consumers do not have the slightest idea what exactly the law restricts, which debt collectors used to their advantage to employ actions that are either illegal or can be easily combated by taking appropriate action. One of the most common examples of debt collectors overstepping their bounds are phone calls at work after a consumer has already told them that any phone calls may jeopardize their employment.

According to Zangrilli, a consumer can easily get any calls to stop by sending a written request to your debt collectors that all communications cease and desist. He goes on to warn against this tactic, however, since it may lead to more aggressive collection efforts like sending the account to a lawyer. A better option may be to find a third party to help resolve your account. "Once debt collectors are informed that a consumer has appointed a third party like an attorney or debt negotiator (http://www.franklindebtrelief.com/credit-card-debt-negotiation.html) to handle the account, they are legally obligated to contact the third party instead of the consumer."

The final piece of advice Zangrilli offers is to remember that debt collectors, despite any attempts to prove otherwise, are not federal marshals, and they are far from being arbiters on your morality, your success as a parent, or whatever other aspect of your personality that they choose to attack in hopes of getting full payment. For the most part, their compensation is based on what they collect, which means they have every incentive in the world to make you feel guilty or insulted if it increases the likelihood that you will pay back the debt. Don't take it personally.

Franklin Debt Relief is a leading debt counseling firm located in Chicago, IL. FDR's "New Deal" program uses debt settlement and debt negotiation to lower the debt burdens of consumers in a state of financial hardship. Visit http://www.franklindebtrelief.com/ or call (877) 274-1260 if you would like free information about how to best combat collections calls.

Information from: insideARM.com (Previously CollectionIndustry.com)

DebtorBasher is not advertising / promoting Franklin Debt Relief or FDR's "New Deal" program...I'm simply passing info onto others who may benefit from the information.

     
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Collectors Seek to Modernize Do Not Call Update
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November 27, 2007

Collectors Seek to Modernize Do Not Call Update

The collection industry is seeking to use current legislation concerning the Do Not Call list to lift a restriction that is outdated due to current technology: using predictive dialers to call cell phones.

As legislation in the House and the Senate seek to make the Do Not Call list permanent, ACA International of Minneapolis, Minn., is seeking to add an amendment to one of the pending bills to enable bill collectors to use predictive dialers to call cell phones.

Under current law, predictive dialers can be used to call land lines, but not cell phones, explains Rozanne Andersen, ACA International executive vice president and general counsel. While it makes sense for firms to be forbidden from making typical telemarketing calls to cell phones because the recipient has to pay to receive the calls, collectors should be able to use the technology because they are trying to recover a payment obligation from the call recipient, Andersen explained.

The Do Not Call list went into effect in June of 2003, with re-registration needed in June 2008. Collectors are exempt because they're collecting on an obligation rather than trying to sell additional products and services. ACA officials see the same premise as a basis for the hoped-for amendment.

“The legislation needs to keep up with the technology,” Anderson said. “Some people have gotten rid of their land lines entirely and use only their cell phones.”

The easiest way to get such rules enacted would be to include them as an amendment to one of the existing bills (two in the House, two in the Senate) seeking to change the Do Not Call registry from a list that consumers must re-register for every five years to a permanent list, according to Jacob Heilman, ACA director of federal legislative affairs.

However, initial attempts to do so have been rebuffed by legislators who say the proposed amendment “isn't germane” to the pending legislation, according to Heilman. While unrelated amendments get attached to bills all the time, legislators want to keep the pending legislation “clean” because it's a popular issue.

No one wants to be seen as voting against it, so they don't want an amendment that might cloud the issue, according to Heilman, who adds that it would be much more difficult to get the predictive dialer issue addressed in stand-alone legislation.

by Phil Britt
InsideARM.com

     
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Debate Over Nevada's State Law
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NEVADA -- State Senate Panel Debates Bill Allowing Collectors to be Recorded

After Nevada's lower house approved a measure to exclude debt collectors from the state's dual-consent recording law, the bill gets some debate time in the Senate before a vote.

After passing Nevada's Assembly with a vote of 28-14, AB 127, a bill that would allow consumers to secretly record phone conversations with collection agencies, is now being debated in Nevada's Senate.

The law would change a 1998 Nevada Supreme Court ruling that recording telephone conversations without the consent of both parties is barred under state law.

In support of AB 127, that “69,000 complaints to the FTC” data is being trotted out – again, without any corroborating evidence, or any acknowledgement that the 69,000 figure is all complaints lodged and not the number of valid complaints. The ACA, working with PriceWaterhouse Cooper, is preparing an analysis of the 69,000 complaints.

"I realize this is a departure from the way business is conducted in Nevada," Debbie Smith, D-Sparks, a sponsor of the bill, told the Senate Judiciary Committee. "After becoming aware of the amount of abuse is taking place, I have come to the conclusion that additional consumer protection measures in this area are warranted." However, when Smith mentions “becoming aware of the amount of abuse,” she's only referencing the FTC's data which has not been analyzed in any meaningful way. What she's aware of is growing consumer dissent with collection agencies; that shouldn't necessarily be the basis for an unfair new law.

John Sande IV, a lobbyist for an association of Nevada debt collectors, pointed out that the industry is tightly regulated by federal law. If Nevada wants to change the law regarding recording phone conversations, it should regulate all conversations equally, he added.

April 30, 2007
by Mike Bevel,
insideARM.com

     
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The collectors Script
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Found this article - Jim Finucan is an collection industry insider that is selling a book online for a tidy sum per copy, with gems like the excerpt below in it;

The script below is what an ideal collections call SHOULD entail. While it's condescending and arrogant it's good to have an idea of what those pesky collectors are getting at. Most collectors tend to stray from the script and wing it after a few roadblocks. That's where the violations start building up. Since Jim spent so much time and energy compiling his information, and so many of the people who are supposed to follow his lead aren't doing so, I figured it's your jobs as consumers to weed out those that can't follow the guidelines he's outlined. Now this is actually pertaining to a commercial collections call to a small business but if you've ever been contacted by a collector you've heard similar things before they got nasty.

It's a question from a collector to Jim Finucan (Say his name out loud several times quickly JiM-Finuken - JIMFINUKEN! JIM-FI-NUKEN!!! It sounds like what the main bad-ass in a kung-fu movie might scream right before he cuts a shogun's head off.AYE-YAAA-JIMFINUKEN! (splat) Moving right along after that immaturity.

Jim: How can I be sure that I've gotten to the heart of the problem when I suspect the debtor is being insincere, or even dishonest?

A) Use a technique called ""funneling." It's a method of questioning that begins on a broad level and becomes more specific as you progress. Narrow in and focus on the response you're getting until your suspicions are either confirmed or you can accept the debtor's excuses as genuine.

HERE'S MY FIRST INTERRUPTION: How many collectors that are just shown their desk/phone and told to 'start collecting' could even read that sentence? Now from that number - how many can actually cognitively grasp this concept. From that number - how many can actually do it? It's harder than one might think. That's why they have scripts - see below.

Jim goes on to write:

A typical conversation might go something like this:

"Is there anything preventing you from sending the check for the balance tomorrow?"

"I can't send it tomorrow; I won't be in the office."

"That's hardly a problem; you could mail it out tonight, before you leave. Do you agree?" (WWMES -

"I told you, I just can't."

"You mean, I provide the services to you when you need them and you're the kind of person who won't pay because you don't have the time? Is that right?

"No, it's not like that."

"Then you need to tell me now what it is like. What is it, that's stopping you from taking care of this obligation and leaving yourself exposed to legal action?"

"The company just doesn't have the funds available."

"All right, Tom," (Note that the story is changing here. This reason is either more accurate or another stall tactic.) "What I need you to understand is that excuse doesn't concern me one way or the other. When your company needs funds to continue operating what do you do? That check needs to be in the mail by tomorrow at the latest."

And regardless of his answer, find out which bills are being paid and which ones are not - and why yours is one of those not on the "pay" list.

Funneling down into an excuse with a more precise line of questioning uncovers the true intentions of a debtor. In fact, this technique actually helps the debtor see himself acting in a way that is not congruent with his own beliefs. That exposure will help him make more honest and forthright decisions in the future.

If something doesn't feel right during a collections call question it! Throw a whole series of sharp, penetrating questions at it until it cracks. Then both sides can identify and solve the sense of the problem.

Just thought everyone would like to see an example of what the collectors are told to be do on the phone. In most regards, this is a pretty good technique. Make sure you don't talk yourself into a corner - keep your answers focused on getting a CA to validate. Don't give out any personal info. Don't offer any info. Most new, and/or bad collectors tend to get flustered when YOU don't follow THEIR script. They're expecting excuses. Don't give them any. Go on the offensive and make them answer your questions. Your business isn't their business until they prove it is which most times they cannot. They ask you to reveal personal info that could be used to defraud you - despite your past pitfalls with credit, and finances, you aren't required to offer up info to CA's that, in the wrong hands, could screw up your situation even more. That's all it comes down to. You need your money more than they do. Utilities, food, Mortgages/Rent - all of these things always take priority over whatever the CA is asking for. When you're in a position to do so, you can choose work with a CA - IF they can prove you owe them money; it's not dishonest it's common sense.

     
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