Big deal? You bet! A major makeover of the FDCPA has been finalized! The new requirements provide more control and convenience for consumers, while collectors face new restrictions on the number of contact attempts and message content. Learn the latest collection rules regarding electronic communications, violation interpretations, oversight of debt collectors, and more.
- Distinguish between acceptable and unacceptable collection activity
- Comply with the new call attempt restrictions – not more than seven times within seven days
- Explain the new rules regarding voice messages, emails, and text messages
- Define the new term “limited-content message” and explain what information must/must not be included
- Take the steps required for sufficient oversight of your debt collectors
On October 30, 2020, the CFPB issued its long-awaited final rule implementing major changes and new interpretations under the Fair Debt Collection Practices Act (FDCPA). The final rule affects both financial institutions and their third-party debt collectors. Although the FDCPA technically doesn’t apply to a financial institution collecting its own debt, financial institutions should adhere to the FDCPA to avoid possible UDAAP claims.
Consumers will have increased control over how often and by what means collectors can communicate with them. The final rule encompasses all collection communications with consumers (i.e., mobile phone, voicemail, email, text message, and social media) – even unsuccessful attempts (i.e., consumer doesn’t answer the phone). Further, virtually all electronic collection communications will be required to provide consumers with a simple opt-out method (i.e., reply STOP to stop texts).
In addition, the new rule contains more precise interpretations of what is deemed to be a violation of the FDCPA. For example, it will be presumed that a collector violated the FDCPA’s prohibition on repeated telephone calls if the collector calls the consumer more than seven times within a seven-day period, or within seven days after engaging in a conversation with the consumer. These new requirements will become effective in late 2021. Your institution will need all of that time to implement the required changes into your systems and procedures. Join us to learn the details!
Elizabeth Fast, JD, CPA, Spencer Fane LLP
Elizabeth Fast is a partner with Spencer Fane LLP where she specializes in the representation of financial institutions. Elizabeth is the head of the firm’s training division. She received her law degree from the University of Kansas and her undergraduate degree from Pittsburg State University. In addition, she has a Master of Business Administration degree and she is a Certified Public Accountant. Before joining Spencer Fane, she was General Counsel, Senior Vice President, and Corporate Secretary of a $9 billion bank with more than 130 branches, where she managed all legal, regulatory, and compliance functions.