Keeping you informed about the work that is taking place on your behalf and reminding you of important news and updates. This is a ‘members only’ publication so you need to login to view on the website.
Federal Activity
In March, Director Cordray appeared before the House Financial Services Committee for his CFPB update. DBA submitted questions for the record which will require written responses from Director Cordray. Director Cordray also appeared before the Senate Banking Committee on April 7th and similar questions requiring a written response were submitted.
Professor Todd Zywicki from George Mason University appeared before the Senate Banking Committee on April 5th at a hearing on Consumer Financial Regulations. DBA again submitted questions for the record. The benefit of submitting these questions is that the responses become part of the official Federal Register and provide favorable documentation for future legislative and/or regulatory actions.
State Legislative Activity
Legislatures in Session (active): 32
Tracked Bills in Active Status: 76 out of 102
DBA Retained Lobbyists: 6 (California, Connecticut, Maryland, Massachusetts, New York and Rhode Island)
Active Negotiations: 3 (Connecticut, Massachusetts and Rhode Island)
Noteworthy Actions on Bills in Prior 30 Days:
Maryland HB 783 – Requires debt collectors to possess “verifiable information” to collect on a debt; requires specific affidavit requirements for litigation; requires creditors to provide debt buyers with specific documentation; and prohibits a debt buyer from reselling a purchased debt to any entity other than the originating creditor. This bill died in committee.
Maryland HB 1491/SB 771 – Codifies existing court rules regarding what data and documents debt buyers (and collectors acting on their behalf) must possess prior to initiating a consumer debt collection action and prohibits reviving the statute of limitationsafter it expires through a consumer payment. This bill passed both houses and is awaiting Governor’s signature.
Noteworthy Bills of Continuing Concern/Interest:
Connecticut HB 5571 – Consumer collection agencies would be: (1) prohibited from imposing any interest, fee, or charge unless the debtor explicitly agreed to its imposition in writing; (2) required to attach a copy of the contract and assignment to the complaint; (3) required to provide specific account related information to the consumer within five business days after the initial communication; (4) prohibited from bringing suit and reviving the statute of limitations after the expiration of the statute; and (5) subject to a state-level private right of action.
Massachusetts HB 4194 – Reduces the statute of limitations in an action for the collection of a consumer debt from six to four years to be measured from the earlier of the date of charge-off, placement for collection, or 180 days after the last regular payment. Payments made prior to the limitations period expiring will not toll the statute. Prohibits any attempt to collect a consumer debt once the statute of limitations has expired but would allow a debt collector to accept an unsolicited voluntary consumer payment on a debt. Extinguishes judgments after five years unless the creditor takes action to enforce the judgment.
Rhode Island HB 7028 – Creates the “Expired Debt Act” which would among other things: (1) prohibit consumer contact until the collector “possesses verifiable information documenting” chain of title, the amount of the debt, and the connection of the debtor to the debt; (2) require consumer notices on out of stat debt in every communication when the debt is beyond the statute of limitations; (3) prohibits default judgements on out of stat debt; and (4) provides damages for mental distress and emotional anguish.
Rhode Island HB 7509 – Requires debt buyers to document whether they used statutory or contractual interest when obtaining a judgment and would allow consumers to vacate prior judgments if the plaintiff had not complied with the new standard.
Court Decisions
The following are several noteworthy court decisions recently handed down that may impact DBA members:
Mere Purchasing of Defaulted Debt does not Make One a Debt Collector Says 4th Circuit
Ricky Henson v. Santander Consumer USA, Inc., Fourth Cir. Court of Appeals, No. 15-1187 (Mar. 23, 2016)
The U.S. Court of Appeals for the Fourth Circuit recently affirmed a district court’s dismissal of a Fair Debt Collection Practices Act (FDCPA) complaint finding that the mere purchase of defaulted debt, which an entity then undertakes to collect for itself, does not make the entity a debt collector within the meaning of the Act. The defendant here was not a debt purchasing company, but a consumer finance company that originates credit and, in addition, sometimes purchases portfolios which included defaulted debt. The Court held that the debt purchaser did not meet the FDCPA definition of “debt collector” because the plaintiffs had not (and could not) show that the debt purchaser “regularly” collected debts “owed to another” or that it was “doing so here.”
2nd Circuit Joins Sister Circuits in Requiring Notice of Accruing Interest When Stating the “Amount Due”
Avila v. Riexinger & Associates, LLC, Second Cir. Court of Appeals, No. 15‐1597 (Mar. 22, 2016)
The U.S. Court of Appeals for the Second Circuit recently vacated the dismissal of federal Fair Debt Collection Practices Act (FDCPA) allegations that a debt collector’s notice stating the “current balance” of the debt without disclosing that the balance may increase over time due to interest and fees was “misleading” within the meaning of Section 1692e. As you may recall, 15 U.S.C. § 1692e provides that “[a] debt collector may not use any false, deceptive, or misleading representation or means in the collection of any debt.” The Court rejected the district court’s ruling that because section 1692g requires disclosure only of “the amount of the debt”, the failure to disclose that interest would continue to accrue could not violate section 1692e. Rather, the Court held that a debt collector will not violate § 1692e if either: (1) the collection notice states that the amount of debt will increase over time, or (2) clearly states that the debt collector will accept the amount stated in the notice in full satisfaction of the debt if payment is made by a specific date.
Arizona Court of Appeals Holds Debt Buyer’s Incorporation of Seller-Creditor’s Records Satisfies Hearsay Business Record Exception
Portfolio Recovery Associates, LLC v. Robertson, Court of Appeals of Arizona, Division One, No. 1 CA-cv 15-0066 (March 24, 2016)
Plaintiff Portfolio purchased from Citibank, N.A. a defaulted credit account owed by Defendant Robertson. In support of its motion for judgment on the account, Portfolio attached Citibank’s records concerning Defendant’s accounts to affidavits made by its “custodian of records” and “authorized agent.” Defendant objected on the basis that Portfolio’s affiants lacked “personal knowledge” regarding the creation and reliability of Citibank’s records. The appeals court disagreed. A company whose business is the purchase of defaulted receivables can lay a proper foundation for the admission of records created by the seller-creditor if it “regularly relies on the information . . . as part of [its] ordinary course of business.” But it must also demonstrate “other strong indicia of reliability” to permit admission of incorporated records.
Education
MEMBERS ONLY: 2016 webinar series on sale!
Receive 12 webinars for the price of 9!
For only $575 you will receive a years’ worth of 2016’s regularly scheduled live webinar series and/or the recorded version of each webinar (if you have to miss a live event). Earn 12 credits while saving nearly $200.
APRIL WEBINAR
- The Fair Debt Buying Practices Act: How to Approach the Courts in Obtaining Default Judgment – Wednesday, April 20, 2016 at 9:00 a.m. PT
Recorded Webinars: If you miss a live webinar, they are all recorded and available on our website. If you purchase the series package, you have access to either the live or recorded 2016 webinar.
Certification
Certification for Law Firms and Collection Agencies.
Although it is not mandatory for law firm and collection agencies, DBA’s Receivables Management Certification Program (RMCP) is a critical step in strengthening compliance integration between debt buying companies and their vendors, assuring the consumer that the same rigorous standards are being upheld. By establishing uniform national best practice standards, DBA ensures that its certified members exceed the consumer protection requirements of state and federal law.
Certification Help and Questions: DBA Staff is here to assist you in completing your certification and to answer any questions you have. Contact Michelle Wren at (916) 482-2462 or mwren@dbainternational.org.
CONGRATULATIONS
Congratulations to our newly certified companies and individuals!
Companies
National Judgement Recovery Center
LCS Capital LLC
LCS Financial Services
Stawiarski & Associates
United Debt Holding LLC
NDS LLC
Mjollnir Group Inc.
eCast Settlement Corporation
Individuals
Kevin Luebke, Legal Portfolio Asset Management LLC
Brian Bowers, Financial Recovery Services Inc.
Adam Katz, NMRC (National Management Recovery Corp)
Hal Siegel, US Equities Corp
Michael Schulman, NDS LLC
Howard Henry, PRA Group Inc.
Don Lemastus, Brightwater Capital LLC
Richard Segol, Alliance Credit Services Inc.
Jerry Parra, Empire Capital Funding Group Inc.
Valerie Towery, SquareTwo Financial
Thomas Ludwig, National Loan Exchange
View all certified companies and certified individuals on our website.
Executive Summit
Join us August 2-4, 2016 at the Omni Hotel on Hilton Head, South Carolina. This beautiful beach front location is where executives will meet, drive policy, and create opportunity. Because it is high season, make sure you book your room early. Every room is a suite and discounted rates start at $259, so you may just want to extend your stay. If you prefer, you may contact the Omni Resort directly by calling (800) THE-OMNI and indicating your group is “DBA International.”
Enjoy Top-Notch Educational Sessions and Bountiful Networking Opportunities
- These three jam-packed August days promise the right balance of networking, discussion, and education. A limited audience ensures every voice is heard and the sessions are interactive.
- Golfers will enjoy Tuesday’s golf event with colleagues on the Robert Trent Jones Golf Course at Palmetto Dunes Oceanfront Resort. The evening receptions on Tuesday and Wednesday embody the perfect combination of relaxed resort style and Southern hospitality that will make you never want to leave.
Attendee Registration opens May 2, 2016. Ensure your seat at the table and register early.
Welcome New Members
(since March 15, 2016)
The DBA International membership continues to grow. Welcome to our newest members:
Array Technology, Inc. – Oklahoma
Sutherland Global Services – New York
Phoenix Asset Group, LLC – Minnesota
The following DBA members have been instrumental in recruiting the above new members. Thank you for your effort!
Mike Colby, Second Round
John Russo, Capital Alliance Financial, LLC
Read more about these members and other members on the Member Search page.
Making the Most of Membership
Who are you and what do you do?
Being equipped with a good ‘elevator speech’ is critical to pique people’s interest especially if this quick encounter leads to a new business deal.
How will this help you if:
- You don’t have a well-crafted company description in your DBA member profile
- You don’t have your company demographic information in your member profile …how will other members find you in the DBA online member directory?
Go to www.dbainternational.org/ProfileForm to complete a Member Profile form. Adding your company description and other demographic information will help with ‘key word’ searches and assist DBA in promoting your business and industry.
Email your completed Member Profile Form to Barbara Souza at bsouza@dbainternational.org.
White Papers
This month, DBA International released its new White Paper titled “The Value of Resale on the Secondary Market” which dispels the stated rationale of recent efforts to restrict or eliminate the secondary market. DBA International also has issued White Papers on the Debt Buying Industry and on Out-of-Statute Debt.
Read all DBA white papers here.
New Markets
Jan Stieger participated on a panel at the Credit Today Symposium in London on April 7th. She spoke on new technologies in the United States, focusing on the robust compliance software programs and on virtual collections.
DBA International participated on a panel, “Maximizing Investor Return with Collections and Debt Buying”, at the LendIt USA conference April 11 – 12, 2016.
Upcoming Industry Events
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2017 Legislative Fund Contributors
Thank you 2016 Legislative Fund contributors. Your support allows us to influence threatening legislation, while also promoting and preserving the best interests of DBA members. Make your contribution today!
Titanium ($15,000)
Calvary Investments, LLC
Silver ($5,000)
Second Round
U.S. Equities Corp.
Brass ($1,000)
Barnes Financial Services, LLC
Other Contributors
Crosby Capital
Debt Control Agency, Inc. (DCA)
Dynamic Recovery Solutions
Federal Pacific Credit Company, LLC
Fort Crook Financial
Michael Haynes & Associates
Moss Adams
Premier Forty Financial, LLC
Rodriguez Fernandez Law Office