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Government Affairs Report - May 2012
View this article at ACA International.
ACA International, the Association of Credit and Collection Professionals, strongly disagrees with the recent report from the National Consumer Law Center (NCLC) to forgive student loan debt and the inaccurate portrait of debt collection created to further its agenda.
“In recovering delinquent or defaulted student loan debt on behalf of the Department of Education, collectors are proud of their exceptional customer service and efforts to return tax dollars to American taxpayers,” said ACA CEO Pat Morris. “Our members have a fundamental belief that consumers, regardless of the type of debt being collected, deserve to be treated respectfully and lawfully.”
“We take consumer complaints very seriously and agree on the importance of protecting consumers against businesses that engage in deceptive, unfair or abusive practices,” said Morris. However, the report, which relies more on assumption and personal opinion than fact, fails to paint a clear picture about consumer complaints against the third-party debt collection industry:
More debt volume = more contacts = more complaints. Student loan debt in America now outpaces credit card debt. This increase, along with an increase in volume of delinquent or defaulted debt as a result of the economy, is prompting more consumer contact from collectors than ever before.
Consumer complaints are rising overall, not just for debt collection. Since 2001, overall FTC complaint volume for all industries rose from 325,000 complaints to 1.8 million. In 2002, the Better Business Bureau (BBB) received 626,000 complaints overall, of which 10,000 were collection agency related. In 2011, complaints rose to 895,000 overall, of which 17,500 were collection agency related.
New technology has made it easier for consumers to submit complaints. Consumers now have more opportunities to file complaints online or with smartphone applications that make the process far easier than ever to record a complaint for any reason. One new application boasts that it has sent more than 214,000 complaints to the FTC since its inception.
Collectors want to resolve consumer complaints. Debt collectors want to work with consumers to resolve complaints but can't under the current FTC model. ACA members plan to work closely with the Consumer Financial Protection Bureau to resolve issues presented through the bureau's proposed complaint resolution system for debt collection complaints. According to the BBB, which has a complaint resolution model, debt collectors resolve 83 percent of the complaints received; significantly higher than other industries.
ACA is helping consumers find useful information and resources at www.askdoctordebt.org. Questions are answered by debt collection experts. Visitors are not asked to register, provide any personal information, or pay for anything.
“Debt collection has significant economic benefit,” said Morris. Recent data confirms that third-party debt collection is essential to the national and state economies, which are built on a foundation that those who provide credit, goods and services expect to be repaid. Collection agencies are employers, taxpayers and active in their communities.
For more information, contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org.
For more information on ACA Federal Government Affairs, click here.
View this article at ACA International.
ACA International, the association of credit and collection professionals, today offers personal finance tips for consumers. Careful planning and active communication are important tools to effectively managing personal finances, particularly if a consumer is struggling to make payments on their current debt obligations or being contacted by a debt collector.
Plan and Budget: Determine what you can reasonably afford, create a budget and plan, and stick to it. Keep in mind that purchases on credit will need to be repaid at some point in the future.
Track your Spending: Keep tabs on how much you spend to help stay within budget guidelines.
Protect your Identity: Be careful about giving personal information including a credit or debit card number over the phone and online. Monitor your accounts and immediately report any suspicious or unauthorized purchases to your bank or credit card company. Consumers should monitor their credit and are entitled to a free credit report each year at www.annualcreditreport.com. If you believe your identity has been stolen, contact your local police department.
Communicate with Creditors: Having trouble making payments on an existing debt? Contact the creditor to discuss alternative payment arrangements. It won't eliminate your debt but it can make things more manageable. Communication is particularly important if you are behind in payments to a creditor (e.g., credit card, loan, mortgage, medical) to avoid having the debt appear on credit reports.
Communicate with the Debt Collector: If you hear from a debt collector, avoiding a letter or call won't make the debt disappear. The reason for the contact cannot be resolved without the ability to communicate; whether it's to pay an owed debt, verify an alleged debt or confirm that the debt collector has reached the wrong person.
Consumers have Rights: Consumers deserve to be treated respectfully and have rights under federal and state law. For more information about consumer rights in debt collection or to ask questions, visit www.askdoctordebt.org.
For more inforamtion contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org
View this article at ACA International.
ACA International, representing the credit and collections industry, along with Associated Collection Agencies of West Virginia, denounces the illegal and unethical behavior by a debt buyer in the state. The firm in question is not a member of the national or West Virginia trade associations.
“These actions are deplorable and grossly misrepresent the hard work of most collectors who perform a vitally important function for West Virginia and the national economy,” said ACA CEO Pat Morris. “Debt collectors must follow the law and should be held accountable if they don't.”
Consumers do have rights under federal and state law and deserve to be treated respectfully when contacted by a debt collector. According to ACA of West Virginia President Jillian Epstein, “The key is communication - avoiding a letter or call won't make the debt disappear and the reason for the contact cannot be resolved without the ability to communicate.”
For more information about consumer rights in debt collection or to ask questions, visit www.askdoctordebt.org.
Contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org
View this article at ACA International.
International, representing the credit and collections industry, reiterates that while there are shared concerns related to arrest warrants it disagrees with comparisons to the return of ‘debtor prisons' as alleged in sensationalistic media coverage.
Following is a statement from Patrick Morris, CEO of ACA International.
“To claim that debt collectors are manipulating our judiciary system for their exclusive benefit is simply wrong and runs counter to judicial independence.
Third-party debt collectors are hired to assist in the recovery of unpaid accounts from consumers that have acquired, but not paid for, goods and services. Typically, lawsuits by debt collectors against consumers are an action of last resort. If, after several attempts to communicate, the collection efforts fail through the inability to reach a consumer or lack of cooperation, the owner of the account may seek a court's help to adjudicate disputes, determine the proper amount owed and enforce payment.
ACA members follow state law and do not advocate for, nor can they cause, a consumer to be arrested or jailed for an outstanding debt. Like any other civil court case, only a judge, at his or her sole discretion, can issue an arrest warrant that calls for jail time; and only when an individual has been ruled to be in contempt of court for failing to respond to a court order.
The Illinois Collectors Association has met with Attorney General Lisa Madigan's office on this topic and is not opposing proposed legislation in the state. We want to work with policymakers, regulators, courts and attorneys general to identify practical solutions for improving communication so that disputes can be resolved without the need of judicial action.
The work of debt collectors is vitally important to the national and state economies through the recovery of $54.9 billion in unpaid debt to businesses, government and non-profits. Its impact is also felt as the provider of more than 148,000 jobs; as a taxpayer contributing our fair share to local, state and national governments; and $85.2 million and 650,000 hours assisting charitable organizations in our communities.”
ACA International is the comprehensive, knowledge-based resource for success in the credit and collection industry. Founded in 1939, ACA brings together more than 5,000 members in the United States and abroad, and their employees, including third-party collection agencies, asset buyers, attorneys, creditors and vendor affiliates. ACA establishes a wide variety of products, services and publications. For more information on ACA, visit www.acainternational.org. For more information about debt collection and consumer rights, please visit www.askdoctordebt.org.
For more information contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org
View this article at ACA International.
ACA International, the Association of Collection and Credit Professionals, believes the 2011 complaint data in the Consumer Financial Protection Bureau's (CFPB) recent report to Congress paints an inaccurate portrait of consumer complaints against the third-party debt collection industry.
“We take consumer complaints seriously and agree on the significant importance of protecting consumers against businesses that engage in deceptive, unfair or abusive practices,” said ACA CEO Pat Morris. “However, the CFPB's report data from the Federal Trade Commission (FTC) doesn't explain several relevant underlying factors contributing to the increase in the number complaints against the third-party debt collection industry.”
FTC complaints do not necessarily equal bad behavior. While the FTC simply tallies consumer complaints the agency admittedly does so without investigation into whether the complaint is actually illegal or a violation of the Fair Debt Collection Practices Act. It therefore cannot be assumed that all complaints equate to actual bad behavior.
More debt being collected = more contacts = more complaints. The significant increase in volume of delinquent or defaulted debt during America's current recession is prompting more consumer contact than ever before. Today, more than one billion consumer contacts are made each year in America to collect health care, retail, credit card, student loan, government and other debt.
New technology has made it easier for consumers to submit complaints. Consumers now have more opportunities to file FTC complaints online or with smartphone applications that make the process far easier than ever to record a complaint for any reason. Since 2001, overall FTC complaint volume for all industries has risen from 325,000 complaints to 1.8 million complaints overall.
Lack of consumer awareness about debt collection. ACA is helping consumers find useful information and resources at
www.askdoctordebt.org. Questions are answered by debt collection experts. Visitors are not asked to register, provide any personal information, or pay for anything.
Consumers aren't getting their complaints resolved. Consumers can report complaints to the FTC, but when they don't have the opportunity to get them resolved it can generate repeat complaints. Debt collectors want to want to work with consumers to resolve complaints. According to the Better Business Bureau, debt collectors resolve 84 percent of the complaints they received, which is significantly higher than other industries.
According to Morris, recent data confirms that third-party debt collection is essential to the national and state economies, which are built on the foundation that those who provide credit, goods and services expect to be repaid. “Recovering these assets helps businesses survive, prevents layoffs, keeps cost down and ensures that credit, goods and services are available to consumers.”
For more information contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org
View this article at ACA International.
MINNEAPOLIS (February 29, 2012) – ACA International, the Association of Collection and Credit Professionals, believes the 2011 Federal Trade Commission Sentinel Network report paints an inaccurate portrait of consumer complaints against the third-party debt collection industry.
"We take consumer complaints seriously and agree on the significant importance of protecting consumers against businesses that engage in deceptive, unfair or abusive practices,” said ACA CEO Pat Morris. “However, the FTC's report doesn't explain several relevant underlying factors contributing to the increase in the number complaints against the third-party debt collection industry.”
- FTC complaints do not necessarily equal bad behavior. While the FTC simply tallies consumer complaints the agency admittedly does so without investigation into whether the complaint is actually illegal or a violation of the Fair Debt Collection Practices Act. It therefore cannot be assumed that all complaints equate to actual bad behavior.
- More debt being collected = more contacts = more complaints. The significant increase in volume of delinquent or defaulted debt during America's current recession is prompting more consumer contact than ever before. Today, more than one billion consumer contacts are made each year in America to collect health care, retail, credit card, student loan, government and other debt.
- New technology has made it easier for consumers to submit complaints. Consumers now have more opportunities to file FTC complaints online or with smartphone applications that make the process far easier than ever before to record a complaint for any reason. Since 2001, overall FTC complaints for all industries has risen from 325,000 complaints to 1.8 million complaints overall.
- Lack of consumer awareness about debt collection. ACA is committed to helping consumers find useful information and resources at www.askdoctordebt.org. Questions are answered by debt collection experts. Visitors are not asked to register, provide any personal information, or pay for anything.
- Consumers aren't getting their complaints resolved. Consumers can report complaints to the FTC, but when they don't have the opportunity to get them resolved it can generate repeat complaints. Debt collectors want to want to work with consumers to resolve complaints. According to the Better Business Bureau, debt collectors resolve 84 percent of the complaints they received, which is significantly higher than other industries.
According to Morris, third-party debt collection is essential to the national and state economies, which are built on the foundation that those who provide credit, goods and services expect to be repaid. “Recovering these assets helps businesses survive, prevents layoffs, keeps cost down and ensures that credit, goods and services are available to consumers.”
ACA International is the comprehensive, knowledge–based resource for success in the credit and collection industry. Founded in 1939, ACA brings together more than 5,000 members, and their employees, in the United States and abroad including third–party collection agencies, asset buyers, attorneys, creditors and vendor affiliates. ACA International establishes ethical standards, produces a wide variety of products, services and publications, and articulates the value of the credit and collection industry to businesses, policymakers and consumers.
For more information contact Mark Schiffman at (952) 259-2124 or schiffman@acainternational.org
View this article at ACA International.
ACA International, the association of credit and collection professionals whose membership includes third-party debt collectors, asset buyers and collection attorneys, offers helpful resources for active United States military personnel.
“We sincerely appreciate the sacrifices and service of the courageous men and women of our military who have and continue to put their lives on the line to protect our country and the freedoms we enjoy,” said ACA International CEO Pat Morris. “The Servicemembers Civil Relief Act (SCRA) is important in that it grants special privileges regarding debt and debt collection so soldiers can focus on the immediate task at hand during active duty.”
The SCRA allows certain active military personnel and, in a few cases, nonservice members, to suspend or postpone certain civil obligations as to not worry about financial concerns at home. A lender, creditor or insurer is prohibited by law from taking any adverse actions against military personnel because they exercised their rights under SCRA. Other important areas covered under the SCRA include:
- Default judgments
- Stay of proceedings
- Statutes of limitations
- Cap on interest rates
- Eviction proceedings
- Installment contract for property purchase
- Mortgages
- Terminating home or vehicle leases
The SCRA can only be exercised while engaged in active duty, including full-time training; annual training duty; and attendance at a service school while in active military service. Generally, the SCRA applies only to obligations and liabilities incurred prior to entering active duty and typically not those incurred during active duty.
For more information about the SCRA and rights of military personnel when it comes to debt collection, visit www.AskDoctorDebt.org, a free and valuable consumer-focused financial literacy resource. Available in both English and Spanish, visitors are not asked to register, provide any personal information or required to pay for use.
“The effective management of credit and accounts receivable is important to the national and state economies,” said Morris. “Third-party collectors provide an essential service and are actively engaged in their local communities as employers, volunteers, philanthropists and taxpayers.”
ACA International is the comprehensive, knowledge–based resource for success in the credit and collection industry. Founded in 1939, ACA brings together more than 5,000 members and their employees in the US and abroad, including third–party collection agencies, asset buyers, attorneys, creditors and vendor affiliates. ACA International establishes ethical standards, produces a wide variety of products, services and publications, and articulates the value of the credit and collection industry to businesses, policymakers and consumers. For more information about ACA International, visit www.acainternational.org.
View this article at ACA International.
ACA will host its annual Spring Forum & Expo in Las Vegas at the Red Rock Casino, Resort & Spa, March 21-23, 2012, where over 300 credit and collection professionals will attend more than 10 ACA seminars and a session track devoted solely to health care collection topics.
“It's a great opportunity to meet up with new and old friends and hear industry leaders discuss industry challenges,” said Jim Christensen, CEO, Array Services Group.
This year's health care topics feature hot button issues such as the upsurge of HIPAA compliance problems in 2011, impact of hospital mergers and acquisitions, impact of health care reform, litigation trends and updates from several health care providers.
Attendees can also work toward a number of Campus ACA designations at the meeting, including the Credit & Collection Compliance Officer Designation which can be completed entirely on site.
“I'm looking forward to sharing ideas and brainstorming with my peers,” said Pam Kirchner, chief executive officer, BCA Financial Services Inc. “The agenda covers a wide range of topics crucial to the success of any organization. I always walk away with at least one great idea!”
During the event, attendees will get the chance to network with more than 30 of ACA's affiliate vendor members, who offer products and services catered to the industry.
Support financial literacy education by attending the 2012 “Ask Doctor Debt” Golf Tournament on Wednesday, March 21, at the Angel Park Golf Club. Purchasing this optional, special event will cover green fees, cart fees and meals.
Need to register for ACA International's Spring Forum, March 21-23, 2012?
Register online at www.acainternational.org/springforum or contact
Rosa Garza at garza@acainternational.org / (952) 928-8000 ext. 138
ACA room rate available for those who book their room before Feb. 28, 2012.
Discounts are available for individuals who register for Spring Forum before March 2, 2012.
ACA International, the Association of Credit and Collection Professionals, is the comprehensive, knowledge–based resource for success in the credit and collection industry. Founded in 1939, ACA brings together more than 5,000 members worldwide, including third–party collection agencies, asset buyers, attorneys, creditors and vendor affiliates. ACA International establishes ethical standards, produces a wide variety of products, services and publications, and articulates the value of the credit and collection industry to businesses, policymakers and consumers. For more information about ACA International, visit http://www.acainternational.org.
View this article at ACA International.
Dear Editor,
As reported in the Wall Street Journal recently (“U.S. Gets Tougher on Debt Collecting”), the Federal Trade Commission issued a consent decree outlining, among other things, acceptable actions in the collection of debt in which the applicable state statute of limitations has expired.
In the United States, there is no universally defined statute of limitations on consumer debt in that it varies from state to state. Once a state statute of limitations has expired, with the exception of Wisconsin and Mississippi, the debt does not go away and attempts to collect may occur subject to state and federal laws.
ACA International and its members strongly support financial literacy and consumer education initiatives. We believe in a consumer's right to respect and fair treatment and welcome the opportunity to work cooperatively with the FTC on activities related to these initiatives. For more information on consumer rights in debt collection, please visit www.askdoctordebt.org.
ACA International is proud of its members' significant contributions to our national and state economies. We look forward to working with the FTC, Consumer Financial Protection Bureau and the states to create a system with balance between the important positive impacts of our industry and consumer protection.
Sincerely,
Pat Morris
CEO, ACA International
View this article at ACA International.
Third-party debt collection has an important impact on America's national, state and local economies, according to a new study by ACA International and global advisory firm Ernst and Young (www.acainternational.org/impact) based on 2010 data.
“These findings reinforce the critical role the third-party debt collection industry plays as a service provider in recovering unpaid consumer debt on behalf of the public, private and non-profit sectors,” said ACA International CEO Pat Morris. “Moreover, third-party collectors are actively engaged in their local communities as employers, volunteers, philanthropists and taxpayers.”
Key national findings of this landmark survey include:
- Recovering Assets: A total of $55 billion was recovered on behalf of creditor clients. The collection of consumer debt also provides a valuable benefit to American households. Based on a net of $44.6 billion recovered, third-party debt collection efforts represent $396 in savings on average per household by keeping the costs of goods and services lower.
- Job Creation: Third-party collection agencies directly employed 148,272 people with a payroll of $5 billion. Indirectly, the industry influenced creation of more than 300,000 jobs with a payroll of $10 billion.
- Paying Taxes: Third-party collection agencies and their employees paid $495 million in federal taxes, and $509 million in state and local taxes. The ancillary impact of the industry generated a total $970 million in federal taxes paid and $1 billion in state and local taxes.
- Giving Back: Third-party collection agencies and their employees contributed $85.2 million and volunteered 652,000 hours to charitable community causes.
“Our nation was built on the premise that those who provide credit, goods and services to consumers have the expectation of being repaid,” said ACA International President Mark Neeb. “Recovering these debts helps organizations survive; prevents layoffs; keeps cost down and credit, goods and services available; and reduces the need for tax increases to cover government budget shortfalls.”
To review the complete ACA / Ernst and Young report, “The Impact of Third-Party Debt Collection to the National and State Economies,” please visit www.acainternational.org/impact.