Breaking Down Email and Text Message Communications in the FDCPA

---

By Colin Winkler

As ACA International previously reported, on Friday, Oct. 30, the Consumer Financial Protection Bureau released its long-awaited final rule amending Regulation F , which implements the Fair Debt Collection Practices Act. The rule has now been published in the Federal Register and will take effect on Nov. 30, 2021.

Following an initial analysis of the rule, ACA published part one of this three-part series providing an initial closer look at general information applicable to the entire final rule and some notable provisions of Sections 1006.1 through 1006.6(b), including applicable “official interpretations,” which collectively cover the rule’s authority, purpose, and scope; definitions; and communications in connection with debt collection.

This article, part two in the series, will cover Sections 1006.6(c) through 1006.14, including applicable official interpretations. As a reminder, the official interpretations were adopted pursuant to federal notice-and-comment process, so they stand on equal legal footing with the enumerated sections of the final rule.

Part three of this series, coming later this month, will break down Sections  1006.14 through 1006.108, which cover harassing, oppressive, or abusive conduct; false, deceptive, or misleading representations or means; unfair or unconscionable means; other prohibited practices; disputes and requests for original-creditor information; sending required disclosures; record retention; relation to state laws; and exemptions for state regulation.

Now, picking up where we left off last time:

1006.6(c) – Communications with a Consumer after Refusal to Pay or Notice to Cease Communication

This provision of the “Communications in Connection with Debt Collection” section of the final rule covers communications with a consumer after the consumer has issued a refusal to pay or has requested that the debt collector cease communications. It reflects the language of FDCPA Section 805(c).

The bureau expressly declined consumers’ and consumer advocates’ entreaties that it require debt collectors to cease contact with a consumer upon oral notification from the consumer, finding that the FDCPA’s statutory language requires consumers to submit cease-communication and refusal-to-pay requests in writing. It’s worth noting for your policies and procedures, if you haven’t already.

Note, however, that a consumer’s oral request to stop calling—or words of similar import—while perhaps not a proper request under this section of the final rule and FDCPA Section 805(c), may nevertheless constitute an instruction to the debt collector under Section 1006.14(h)(1)—which addresses “prohibited media communications”—that the consumer no longer wishes to hear from the debt collector via telephone. More on that later in this article.

With respect to the timing of these cease-communication and refusal-to-pay notifications, the CFPB pragmatically provides in Comment 6(c)(1) that the consumer’s notice to the debt collector—when made “in writing or electronically using a medium of communication through which a debt collector accepts electronic communications from consumers”—will be deemed to be complete “upon the debt collector’s receipt of that information.” So, if a consumer sends you a cease-communication letter on Monday, and you call her on Tuesday before you’ve received the letter, you will not have committed a violation of FDCPA Section 805. (But the bureau does not provide an example using emailed notice from a consumer, so query how exactly that will work in light of your agency’s policies and procedures.)

Exceptions to the cease-communication provisions of Section 1006.6(c) permit a debt collector that has previously received a cease-communication request from the consumer to nevertheless communicate or attempt to communicate with the consumer to notify the consumer that (1) the debt collector will be ceasing collection, if true; (2) the debt collector or creditor may invoke specified remedies that the debt collector or creditor ordinarily invokes, if true; and (3) to notify the consumer that the debt collector or creditor intends to invoke a specified remedy, if true.

1006.6(d) – Communications with Third Parties (and Electronic Communication Procedures)

With subparagraph 1006.6(d), the rule begins to shed some on light on real, longstanding pain points for the industry. Here, the rule sets forth “procedures” for electronic communications (email and text message) and provides that if a debt collector adopts and documents conformance with those procedures, it will be deemed by regulation to have “maintain[ed] procedures that are reasonably adapted to avoid a bona fide error” and designed to avoid third-party disclosures otherwise prohibited by Section 1006.6(d)(1) and FDCPA Section 805(b).

Now, let’s be clear: this isn’t a real safe harbor. Rather, as the bureau writes in a footnote early on in discussing the scope of the final rule, “the bureau uses the phrase ‘may obtain a safe harbor from civil liability’ to mean that a debt collector who follows the procedures in Section 1006.6(d)(3) through (5) may have a bona fide error defense to civil liability under FDCPA Section 813(c) . . . for an unintentional third-party disclosure.” See final rule at p.5, n.6 (emphasis added).

Really, all the provisions of Section 1006.6(d) try to do is set up a bona fide error defense if a debt collector’s attempt to communicate by email or text message results in an unintentional third-party disclosure. And it’s a noble effort, trying to strike a balance for the sake of more convenient and cost-effective electronic communications—which benefit everyone—while honoring a consumer’s communications preferences and, as much as possible, mitigating the risk of third-party disclosures.

To avail itself of the protections of this bona fide error defense under 1006.6(d), a debt collector’s procedures must include steps to “reasonably confirm and document” that:

(1) the debt collector used an email address obtained in accordance with the procedures set forth in Section 1006.6(d)(4) or, for text messages, a telephone number obtained in accordance with Section 1006.6(d)(5); and

(2) the debt collector did not communicate with the consumer using an email address or telephone number that the debt collector knows has previously led to a third-party disclosure.

For email, this means that a debt collector may communicate with a consumer via an email address obtained directly from the consumer; from the creditor; or from a prior debt collector. The CFPB lays out relevant procedures for each in 1006.6(d)(4)(i), (ii), and (iii), respectively. We’ll address those procedures in greater depth in a separate article.

For text messages, a debt collector may communicate with a consumer via text message to a given telephone number if it has the consumer’s express or implied consent to do so. In either case, the debt collector must take steps to ensure that the telephone number remains assigned to the consumer, which means the debt collector must ensure that within the last 60 days either:

(1) the consumer has texted the debt collector using the telephone number and has not since opted out of text messages;

(2) the consumer has provided or renewed consent for the debt collector to send text messages to the number; or

(3) the debt collector has “confirmed, using a complete and accurate database, that the telephone has not been reassigned from the consumer to another user since the date of the consumer’s most recent consent [i.e., implied consent via text message sent from the consumer to the debt collector or express consent given directly to the debt collector] to use that telephone number to communicate about the debt by text message.”

Note that for the purposes of the database-confirmation provision of these procedures for text messaging, “the database established by the FCC in In re Advanced Methods to Target & Eliminate Unlawful Robocalls (33 FCC Rcd. 12024 (Dec. 12, 2018)) qualifies as a complete and accurate database, as does any commercially available database that is substantially similar in terms of completeness and accuracy to the FCC’s database.” See comment 6(d)(5)-1 at p. 617.

As with the email procedures designed to avoid inadvertent third-party disclosures, we’ll break down the rules about texting in a separate article.

Finally, in all cases of electronic communications (or attempted communications), the debt collector must provide “a clear and conspicuous statement describing a reasonable and simple method by which the consumer can opt out of further electronic communications . . . to that [email] address or [for texts] telephone number.” The rule does not, however, mandate a form for the opt-out mechanism (including as to font size), although it does provide useful examples at comment 6(e)-1.

For emails, think about the opt-out mechanism like an “unsubscribe” function in a commercial email, e.g.: “To stop receiving our emails at this email address, click HERE.” And note that it’s not clear that a hyperlink like “Click HERE to update your communications preferences” that brings the consumer to a separate webpage to change their communications preferences (including for that email address) would suffice, as it might not be deemed sufficiently “simple.” See comment 6(e)-1.ii. See comment 6(e)-1.iii for a different example of an email opt-out mechanism (reply “STOP” in the subject line).

For opt-out from text messaging, think about the opt-out provision much like the “STOP” mechanism that the Cellular Telecommunications and Internet Association (CTIA) requires for short-code text messages—give the consumer a simple function right there in the text message to express his or her preference to not receive your text messages to that phone number going forward. See comment 6(e)-1.i.

1006.10 – Acquisition of Location Information

Under the FDCPA, the term “location information” means “a consumer’s place of abode and his telephone at such place, or his place of employment.” (FDCPA Section 803(7)). The bureau promulgated Section 1006.10 of the final rule to implement this definition and the acquisition-of-location-information provisions of FDCPA Section 804.

To its credit, the bureau recognized that—despite consumer advocates’ entreaties to prevent all third-party communications—the FDCPA expressly permits third-party communications for the purposes of acquiring location information subject to restrictions on the “form, content, and frequency of location communications . . . designed to protect consumers’ privacy and third parties from harassment.” Section-by-section analysis at p.233.

With respect to “uncertainty regarding mobile telephone numbers and email addresses,” the bureau’s section-by-section analysis notes that for the purposes of Section 1006.10, “nothing in the final rule prohibits a debt collector who is engaged in a permissible location communication from requesting other pieces of contact information for the consumer.” Section-by-section analysis at p. 235.

Finally, note that the call-frequency limits set forth in Section 1006.14(b), discussed below, also apply to third-party location-acquisition calls—see Section 1006.6(c)—and that the rule and the statute additionally require that a debt collector not communicate more than once with any third-party unless requested to do so by that person or unless the debt collector “reasonably believes” both that any location information previously obtained from that person “is erroneous or incomplete” and that the person now has correct or complete location information about the consumer.

And don’t forget, of course, that too many calls to any person—a consumer or a third-party, even if made for the purposes of acquiring location information—could constitute “harassing, oppressive, or abusive conduct,” which brings us to…

1006.14 – Harassing, Oppressive, or Abusive Conduct

This section of the final rule implements FDCPA section 806, which “prohibits a debt collector from engaging in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt.” With the exceptions of Sections 1006.6(b) and (h), the provisions of Section 1006.6 generally restate the statutory provisions.

Comments 14(a)-1 and (a)-2 provide some important insight into the bureau’s thinking with respect to conduct that has the natural consequence of harassing, oppressing, or abusing a person. Specifically, that official interpretation clarifies that for the purposes of this standard, communications should be analyzed both individually and collectively. So, for instance, you might call a consumer a handful of times in a given week, including leaving a limited-content message, but stay under the call frequency limit imposed by 1006.14(b), yet nevertheless violate the general prohibitions of Section 1006.14(a) because in addition to those permissible phone calls you sent a number of emails and text messages and attempted to contact the person several times via a private social media chat. While any of these communications (or attempts to communicate) may, by itself, be permissible, they might be found in combination to constitute harassment, oppression, or abuse.

The balance of the provisions set forth in 1006.14 reiterate the provisions of the statute, but 1006.14(b) and 1006.14(h), below, merit special preliminary discussion.

1006.14(b)– Call Frequency Limits

In one of the higher-impact provisions of the final rule, the bureau finalized its proposed provision on call-frequency limitations, but with two twists: First, rather than a bright-line calling limitation, as proposed, the call-frequency provision in the final rule creates a rebuttable presumption. This change cuts both ways, as discussed below. Second, rather than apply the call-frequency limitations to a specific consumer, the rule applies them to calls placed “to a particular person in connection with the collection of a particular debt . . . .” (Emphasis added.)

The rebuttable presumption presents both drawbacks and benefits for agencies. On the one hand, it creates some cover for agencies that may nominally exceed the calling limitations imposed by Section 1006.14(b)(2). On the other hand, it makes clear what ought to be apparent from the other provisions of Section 1006.14: a debt collector can harass, oppress, or annoy a person even when it does not call more frequently than the rule permits. The comments make clear that a consumer could rebut the presumption of compliance by making specific showings regarding the frequency and pattern of calls; the frequency and pattern of voicemails; the content of prior communications with the consumer; or the debt collector’s conduct in prior communications with the consumer. See comment 14(b)-2.i.

In terms of operation, the call frequency limitations generally require that a debt collector not place a telephone call “to a particular person” (which is broader than just “to the consumer”):

1. More than seven times in a period of seven consecutive days; or
2. Within seven consecutive days after having had a conversation with that person via telephone.

Certain calls do not count for the purposes of the rule. If you call a person within seven days of receiving her consent to call, that doesn’t count. So, for example, if you ask your consumer on Monday, “When would be a good time to talk? How about Thursday at 3 p.m.?” and she says “Yes, call me on Thursday at 3 p.m.,” when you call her back on Thursday at 3 p.m., that phone call isn’t actually a phone call for the purposes of the call-frequency count (regardless of whether she answers the phone on Thursday at 3 p.m.). Likewise, if you place a call and it’s never connected to the dialed number (e.g., number out of service), that call doesn’t count. And calls placed to any of the third parties enumerated in Sections 1006.6(d)(1)(i)-(iv) don’t count for the purposes of the call-frequency rule either. (That last exception would be calls to the consumer’s attorney; a credit reporting agency; the creditor; the creditor’s attorney; or the debt collector’s attorney.)

With those general guardrails in mind, let’s be careful how we talk about this rule, because how we talk about it will dictate how we understand it and how we implement it. It’s not a hard cap, nor should it be viewed as a quota to be filled. It’s definitely not a “seven in seven” rule, which is a fun name that we’ve heard bandied about, but which elides key provisions of the rule. And it’s not a “communications” rule.

It’s a rule about the generally permissible frequency with which a debt collector may attempt to reach a particular person about a particular debt. To the extent that words have meaning and to the extent that these statutory and regulatory terms of art—“communications” and “telephone calls,” and “attempts to communicate”—have particularized legal meanings, we need to take care in how we talk about and think about this rule.

So how about simply calling it “the call-frequency limitations rule”? If you stay within the prescribed call frequency limitations, you’re presumed to have complied with the FDCPA—as long as you haven’t otherwise harassed anyone via telephone. And if you’ve exceeded the prescribed call-frequency limitations, you’re presumed to have violated the FDCPA—unless you can show that you exceeded the rule’s limits for good reason. See comment 14(b)(2)(ii)-2.i-iv (pp. 628-630) setting forth “Factors to rebut the presumption of a violation” and providing illustrative examples.

Turning back to the “particular debt” language of the call-frequency limitations rule, it’s worth taking a moment to discuss because it reflects a change from the proposed rule. The rule defines “particular debt” as “each of consumer’s debts in collection.” (For student loan debt, however, it means “all student loan debts that a consumer owes . . . that were serviced under a single account number at the time the debts were obtained by a debt collector.”)

This “particular debt” language in the call-frequency limitations rule raises the question: What if I talk to a person about two debts during one telephone call? How do I count that call? And what if I attempt to call a person, but the call isn’t answered, but I don’t leave a message? How do I count that attempt?

The rules provide some guidance on these questions in comment 14(b)(4)-1.ii. There, the bureau makes clear that “[i]f a debt collector and a person discuss more than one particular debt during a telephone conversation, the debt collector has engaged in a telephone conversation in connection with the collection of each such particular debt, regardless of which party initiated the discussion about the particular debts . . . . ” (See p. 635).  Conversely, if the caller and the recipient of the call discuss “no particular debt,” the debt collector must nevertheless count the conversation toward the call limit for at least one particular debt. (See p. 635-36.)

There’s more to unpack in the call-frequency limitations rule, but we’ll make just one last observation here: for the purposes of counting telephone calls, leaving a ringless voicemail will count as a call. Technically, leaving a ringless voicemail isn’t “causing a telephone to ring,” to use the language of FDCPA Section 806(5), but the CFPB’s section-by-section analysis makes clear that the bureau considers ringless voicemails to be “telephone calls” for the purposes of the call-frequency limitations rule. (Recall that elsewhere, in discussing limited-content messages, the CFPB states that “voicemail messages include ringless voicemail messages.” So, there you have it, the duality of ringless voicemails – they’re both voicemail messages and telephone calls, depending on which provision of Reg F you’re talking about.

We’ll have more on the call-frequency limitations rule because it’s yet another more nuanced part of the rule that requires focused attention. For now, we’ll move on to the next new provision that the rule presents: prohibited communication media.

1006.14(h)– Prohibited Communication Media

As discussed above, Section 1006.14 contains other enumerated provisions, but they mostly restate or mirror the language of statute—FDCPA Section 806(1)-(6)– until you get to 1006.14(h), which addresses “prohibited communication media.” In general, this provision requires that a debt collector “not communicate or attempt to communicate with a person through a medium of communication if the person has requested that the debt collector not use that medium to communicate with the person.”

Note that this requirement, like the call-frequency limitation rule, applies to communications with a person, not merely with a consumer.

The prohibited media rule does provide some exclusions for acknowledgement of opt-out requests; a response to a consumer communication through prohibited media; and as otherwise required by applicable law. See § 1006.14(h)(2)(i)-(iii).

It’s probably the second of these exclusions that will be most immediately confusing to members—the exclusion of communications made in response to communications received from people who have previously designated the medium of communication inconvenient or off limits. For the purposes of this discussion let’s just call this the “one-attempt” exclusion to the prohibited communication media rule.

First, note that the official interpretation for the general “prohibited communication media” provision expressly permits, perhaps even encourages, debt collectors to ask “follow-up questions regarding preferred communication media to clarify statements by [a] person” about their communication preferences.

Second, with respect to the one-attempt exclusion, the gist of it could be boiled down to this: even if a person has deemed a particular mode or channel of communication off limits (e.g., “don’t email me” or “don’t call me at this phone number” or the person has replied “STOP” to opt out of the collector’s text-message communications), if that person later contacts the debt collector via that off-limits medium of communication, the debt collector may respond once through that same medium.

While the official interpretations unfortunately do not provide clear-cut guidance on this point, the section-by-section analysis illuminates the issue somewhat and ties the one-attempt exclusion to the official interpretation set forth at comment 6(b)(1)-2. According to the analysis, the bureau’s thinking relates to the capacity of the individual to choose the medium.

So, even in the case of an employer-provided email address that would generally be off limits (particularly if the consumer has told you that it’s her work email and she doesn’t want you to use it for communications), if she emails you from that work email address, you get one chance to reply through that medium.

The prohibited communication media provisions of Section 1006.10 dovetail with other communications provisions of Section 1006.6 and, for that matter, other provisions like the social-media and employer-provided email provisions of Section 1006.18, but we’ll get to that more nuanced analysis in a later article.

NEXT UP

In our third and final installment of this overview series, we’ll pick up with the provisions of Section 1006.18 and continue through the end of the rule, including the appendices.

Until then, if you have questions about what you’ve read or heard so far, don’t hesitate to send us an email at [email protected], and we’ll see if your question needs to be included in our Reg F FAQs. Members can also catch up on our ACA Huddle CFPB Rule series here.

Colin Winkler is ACA International's corporate counsel.