The Debt Collection Drill

Regulators from the CFPB and the FTC encourage the debt industry to look at past enforcement actions and other publications to determine what issues are most important to those agencies. A review of the recent enforcement actions by the CFPB and FTC, as well as other publications, reveal three distinct trends: actions involving unfair treatment of service members; the failure of debt collectors to adequately distinguish and investigate FDCPA and FCRA disputes; and, racial bias in debt collection efforts.

In this timely and thought-provoking episode of the Debt Collection Drill, attorneys John Rossman and Mike Poncin discuss best practices for complying with collections involving service members, handling of FDCPA and FCRA disputes and tips for creating a program to assess and eliminate any racial bias in the debt collection process. During the podcast, the below article series on racial bias in debt collection is discussed.

Direct download: TDCD_ep52.mp3
Category:general -- posted at: 3:15pm CDT

Confusion and threats of class action lawsuits continue to plague the debt industry regarding the appropriate method for accepting recurring check payments by phone or via a website.  Specifically, issues arise regarding the type of consent that a consumer must give to authorize recurring payments from a checking account or debit card.  Further, the types of disclosures that must be provided by a debt collector accepting such payments are buried in the regulations. Clarity was originally provided on this topic in the below article published in 2013:           

In the most recent episode of the Debt Collection Drill podcast, attorneys John Rossman and Mike Poncin discuss recent issues and questions regarding  compliance with the requirements for accepting payments by phone or via a website.  Also discussed during the podcast is a recent scholarly study on the damaging impact of strict debt collection regulations on consumers.  A link to that study may be found below:

Direct download: TDCD_ep51.mp3
Category:general -- posted at: 8:38am CDT

State legislatures frequently tweak debt collection laws, sometimes annually. These changes in the law often require changes to debt collection letters and processes by the debt industry. This year was marked by a number of legislatures making wholesale changes to the debt collection laws of their respective States. Three States in particular; New York, Illinois and Maine; changed their laws to such a degree that ambiguities exist in how to comply and questions have arisen as to whether complying with the new State laws will violate the FDCPA.

In the latest episode of the Debt Collection Drill, attorneys John Rossman and Mike Poncin break down the law changes in these three States and provide practical guidance for compliance and avoiding pitfalls.

Direct download: TDCD_ep50.mp3
Category:general -- posted at: 9:21am CDT

The recent order issued by the Federal Communications Commission (FCC) regarding the Telephone Consumer Protection Act (TCPA) encompasses 138 pages (including hundreds of footnotes) and created an instant tidal wave of questions, comments and uncertainty about the use of telephone technology to contact consumers on mobile phones.

Attorneys John Rossman and Mike Poncin break down the FCC Order and the important highlights of it for the debt industry in 13 minutes in the latest episode of The Debt Collection Drill.




Direct download: TDCD_ep49.mp3
Category:general -- posted at: 8:14am CDT

There is a cost associated with a business accepting payments via credit card.  Depending on the type of credit card, bank and payment processor used by the business, that cost can vary for each transaction.  However, most consumers expect and demand that businesses will accept credit cards as a payment method.


For the collection industry, whose members often accept a volume of payments, the fees associated with accepting credit card payments from consumers can be a substantial sum of money every month. 



Recent litigation and changes to the law regarding the ability of collection agencies to assess credit card convenience fees raises numerous questions.  In the latest episode of the Debt Collection Drill, attorneys John Rossman and Mike Poncin tackle the issue of credit card convenience fees and the rapidly evolving law that governs such fees.  

Direct download: TDCD_ep48.mp3
Category:general -- posted at: 12:46pm CDT

The West Virginia Consumer Credit Protection Act, and how it was interpreted by the consumer attorneys in West Virginia, was the primary reason that State had previously been described as one of the most treacherous places in the country for debt collectors. Lawsuits were routinely commenced West Virginia State Courts seeking hundreds of thousands of dollars in statutory damages when the consumer suffered no injury.

In this most recent episode of the Debt Collection Drill audio blog, attorneys John Rossman and Mike Poncin examine in detail the recent common sense changes to the law in West Virginia and how these changes will impact the debt industry.

Direct download: TDCD_ep47.mp3
Category:general -- posted at: 10:51am CDT

Collection agencies, debt buyers and credit granters are often under siege, forced to defend against identical claims on multiple jurisdictional fronts, regardless of whether the claims are on behalf of an individual or a putative class. One strategy for consolidating the defense of identical claims is to file a motion with the U.S. Judicial Panel on MDL to transfer claims to a single venue.

The MDL Panel was created under 28 USC 1407 and its job is to consider whether litigation pending in multiple federal courts involves common questions of fact that make it appropriate to consolidate and coordinate proceedings. The primary purpose of MDL is to centralize litigation to avoid duplicative and costly discovery, conserve resources and prevent inconsistent court rulings.

In the latest episode of the Debt Collection Drill Moss & Barnett attorneys Mike Poncin and Issa Moe discuss the potential application of MDL to consumer litigation, the procedure for seeking MDL, and the risks/benefits associated with MDL.

Direct download: TDCD__ep46.mp3
Category:general -- posted at: 11:10am CDT

The concept that a debt collection communication must be viewed through the lens of the least sophisticated consumer is a fairly established tenet of FDCPA law. While the application of this standard is often the subject of litigation, its premise is that a debt collection communication violates the FDCPA if it would deceive or confuse the least sophisticated consumer.  The obvious exception to the least sophisticated consumer standard is collection communications with a consumer attorney.  This exception is recognized by a number of Courts including the 7 Circuit Court of Appeals decision in Evory which hold that assessing whether collection communications with an attorney for a consumer are deceptive will generally be judged using the competent attorney standard.

The 11th Circuit Court of Appeals recently broke new ground on the assessment of collection communications with attorneys in the Crawford decision, holding that statements in a proof of claim filed in a Chapter 13 Bankruptcy are subject to the least-sophisticated consumer standard.  While the ruling in the Crawford case is most notable and challenging due to its interpretation of the intersection between Bankruptcy law and the FDCPA, the implications regarding all collection communications with consumer attorneys is also substantial.

Debt Collection Drill audio blog, attorney John Rossman hosts a discussion with Moss & Barnett attorney Sarah Doerr about the impact of Crawford decision not only on bankruptcy proofs of claim, but also all collection communications with consumer attorneys.

Direct download: TDCD__ep45a.mp3
Category:general -- posted at: 2:45pm CDT

Collection agencies and debt buyers continue to be inundated with FDCPA and TCPA lawsuits, many of which drag on through months and even years of expensive discovery and motion practice. What if there existed a single argument that could be made in many consumer cases that would successfully remove the matter from Court and likely end the case in its entirety? Surprisingly, such an argument exists, though it is often overlooked in the defense of debt collectors and debt buyers.

A broad array of consumer contracts include arbitration clauses requiring that certain consumer disputes be resolved through arbitration rather than Court proceedings. Recent United States Supreme Court precedent supports enforcement of such arbitration clauses. Depending on the exact wording of the arbitration clause, motions to compel arbitration of FDCPA, TCPA and other consumer litigation may succeed where other arguments fail. Further, in a putative class action such as a TCPA class action if some of the purported class members are subject to an arbitration clause, this alone may be sufficient to defeat class certification.

In the latest episode of the Debt Collection Drill, attorney John Rossman discusses a recent victory for a collection agency in a motion to compel arbitration, along with strategies for successfully crafting this argument, with special guest attorney Jim Bedell from Moss & Barnett.

Direct download: TDCD_ep44.wav.mp3
Category:general -- posted at: 5:06pm CDT