RMA is meeting with the Department of the Treasury to discuss the web of state and federal regulations and possible solutions.
RMA member Mike Lagana attended the K&L hosted Financial Services Symposium where Tom Pahl was the keynote and Todd Zywicki was on a panel. Both Tom and Todd had positive comments on importance of the RMA Certification Program.
RMA is tracking federal legislation including HR 2706 which would end “Operation Chokepoint” and require banks to disclose why they are closing an account and HR 4550 which is the NARCA sponsored legislation exempting attorneys from the FDCPA.
RMA is currently tracking more than 165 bills at the state level that impact the receivables industry in both positive and negative ways. Here are a few noteworthy bills that have had recent activity:
District of Columbia Bill 71 – This bill would amend the District of Columbia’s Debt Collect Law to: (1) expand the definition of debt collector to include debt buyers; (2) require specific data and documents concerning the debt to be in the possession of the debt collector; (3) limit the frequency of consumer contact using a reasonableness standard; (4) require pre-charge-off itemization of interest and fees; (5) prohibit bringing suit when the debt is beyond the statute of limitations and reviving the statute through payment; and (6) remove “willful” from intent for purposes of determining if a violation occurred. In addition, the following provisions in the bill would only apply to debt buyers: (1) expunges the debt after the statute of limitations expires; (2) requires 11 months of account statements; (3) requires a consumer notice detailing the consumer’s right to obtain copies of all the data and documents required by the act; (4) requires a copy of any payment schedule or settlement agreement to be provided to the consumer within 15 days; (5) when bringing suit, requires all of the data and documents to be attached to the complaint; (6) requires authenticated business records; (7) makes debt buyers liable for actual damages, attorney’s fees, punitive damages, and an “additional penalty” of between $500 and $4,000 per violation of the act (including for minor clerical errors); and (8) indicates that any violation of the act by a debt buyer is an automatic ban on future collection activity on the account by anyone. [RMA has retained a lobbyist to oppose this bill. A public hearing on the bill is anticipated to take place in January 2018 at which time RMA members will be encouraged to testify in opposition. More information will be forthcoming.]
Massachusetts HB 1982 – This bill would require passive debt buyers to be licensed as debt collectors in Massachusetts. Currently, third party collection agencies and active debt buyers are regulated and licensed by the Massachusetts Division of Banks while passive debt buyers are regulated by the Attorney General’s Office and not required to be licensed. This bill would also exempt debt buying companies from bonding requirements and allow affiliated companies to be licensed under a single license and subject to a single examination [RMA has been advocating for uniformity and consistency in state licensing laws. Maintaining the Massachusetts bifurcated regulatory scheme does not make sense and adds to industry and consumer confusion. RMA has retained a Massachusetts lobbyist to assist us in our efforts. RMA testified in support of this bill at a legislative hearing in Boston on September 26th. There was no opposition to the bill.]
Massachusetts SB 120 – This bill among other things would: (1) reduce 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; (2) prohibit payments made prior to the limitations period expiring from tolling the statute; (3) prohibit 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; (4) extinguish judgments after five years unless the creditor takes action to enforce the judgment; and (5) reduce the percentage that is subject to wage garnishment. [RMA lobbyist has been retained to oppose the bill in its current form.]
Michigan SB 385 – This bill amends the Michigan Collection Agency Act to allow collection agencies to employ in-house attorneys for the provision of legal advice to the agency or one of its affiliates. However, an attorney who is an employee of the agency may not institute a legal action to collect a claim on behalf of the agency unless the claim is owned by the agency or an affiliate of the agency. [This bill has passed both houses of the Legislature and is awaiting action by the Governor.]
Oregon Rulemaking – RMA has participated in three meetings of a rulemaking task force on a recently adopted Oregon statute that would require the licensure of debt buyers. To date, RMA has been successful in advocating for reasonable program fees, safe harbor protections for early applicants, and clarity regarding in what instances a company must maintain both a debt buyer and collection agency license. Oregon has been accepting debt buyer license applications since November 1, 2017. All debt buyers holding accounts of Oregon consumers will require a license as of January 1, 2018. For additional information, please see RMA’s November 3, 2017, November 7, 2017, and November 28, 2017 member alerts.
If you are interested in obtaining a copy of the RMA state tracking list, please contact David Reid at [email protected].
Cal. Limitations Period on Account Stated Runs from Date of Last Entry, Not Last Purchase
Ordinario v. LVNV Funding, LLC, Ninth Circuit Court of Appeals, No. 16-55417 (Dec. 7, 2017)
On December 5, 2012, the defendant filed a collection lawsuit in California state court to recover an unpaid debt as an account stated. The defendant later withdrew its collection lawsuit. Plaintiff then filed a federal complaint claiming the state collection lawsuit violated the federal Fair Debt Collection Practices Act (FDCPA) and California’s Fair Debt Collection Practices Act, also known as the Rosenthal Act (RFDCPA) because it was filed after the expiration of the applicable limitations period.
California’s statute of limitations for account stated claims is four years. Plaintiff alleged the statute of limitations on his debt began to run from the date of his last purchase in July 2008. The Ninth Circuit held that under California law, the statute of limitations for an account stated claim begins to run from the date of last entry. Here, the last entry occurred when the original creditor assessed a late fee of $39.00 on January 13, 2010. The debt was then charged off by the original creditor on January 30, 2010. Thus, when the collection lawsuit was filed in state court it was well within the four-year limitations period.
A copy of the opinion is available here: Ordinario v. LVNV Funding, LLC
Debt Collector Can Depose Frmr. CFPB Director Cordray, Requests Sanctions for CFPB’s “Improper Tactics”
CFPB v. Weltman, Weinberg & Reis Co., L.P.A., United States District Court, Northern District of Ohio, No. 1:17CV817 (Dec. 6, 2017)
Richard Cordray, the former Director of the federal Consumer Financial Protection Bureau (CFPB) was denied a protective order seeking to prevent his deposition in this underlying enforcement action. Earlier this year the CFPB sued Weltman, Weinberg & Reis Co., L.P.A. (WWR) alleging it violated the FDCPA and the Consumer Financial Protections Act of 2010 (“CFPA”), 12 U.S.C. §§ 5301 in its debt collection practices.
On October 13 WWR served the CFPB with a notice to take Cordray’s deposition. The CFPB balked and moved for a protective order to bar the deposition. The CFPB argued that because Cordray was a “high governmental official” his deposition cannot be taken because WWR had not demonstrated Cordray “has first-hand knowledge related to the claim being litigated, and that other persons cannot provide the necessary information.” However, while the motion was pending, on November 15 Cordray announced his resignation effective November 24, a fact the CFPB only footnoted in its reply brief.
The court denied the protective order finding that because Cordray resigned his position on November 24, he is no longer a “high governmental official” entitled to protection under this standard.
A copy of the opinion is available here: CFPB v. Weltman, Weinberg & Reis Co., L.P.A.
On the same day this opinion came down, WWR filed a motion requesting the court sanction the CFPB for refusing to provide Cordray for his deposition. The motion explained that when Cordray was Ohio Attorney General, he twice engaged a WWR partner to collect debt on behalf of the State of Ohio. As part of the engagement, Cordray required the WWR partner “use Ohio Attorney General letterhead that is materially indistinguishable from the WWR letterhead the Bureau now claims is misleading to consumers” in the underlying enforcement action. WWR claims Cordray was familiar with WWR’s collection practices when he engaged the firm, knowledge that is material to WWR’s defense. WWR asserts that the CFPB stonewalled Cordray’s deposition through “‘improper tactics to delay, avoid, or otherwise interfere with Mr. Cordray’s deposition and manipulated the briefing schedule for its motion for protective order in such a way as to prohibit the Court from ruling on WWR’s deposition notice while Mr. Cordray was still employed by the Bureau.”
Debt Collector Cannot Execute Upon FDCPA Judgment Rendered Against It
Arellano v. Clark Cty. Collection Serv, Ninth Circuit Court of Appeals, No. 16-15467 (Nov. 17, 2017)
The defendant debt collector obtained a state court judgment against Arellano on an unpaid debt. Arellano then filed a federal lawsuit alleging those same collection efforts violated the FDCPA. While the federal FDCPA lawsuit was pending, the defendant debt collector had the state court issue a writ of execution against Arellano on its judgment. The writ directed the sheriff to execute on all “claims for relief, causes of action, things in action, and choses in action in any lawsuit pending in Nevada including, the rights of . . . Arellano . . .” including the pending federal FDCPA lawsuit. The sheriff made the execution and sold Arellano’s rights to the federal FDCPA lawsuit at sheriff sale to the defendant debt collector.
The debt collector then moved to dismiss the federal FDCPA lawsuit for lack of standing, which the trial court granted. Arellano appealed.
The Ninth Circuit Court of Appeals reversed that holding because the defendant debt collector’s use of state law here “frustrates” the FDCPA’s purpose and is therefore preempted. “Debt collectors cannot evade the restrictions of the Act by forcing a debtor’s claims to be auctioned, acquiring the claims, and dismissing them. To allow otherwise would thwart enforcement of the FDCPA and undermine its purpose.”
A copy of the opinion in is available here: Arellano v. Clark Cty. Collection Serv
Need re-certification credits? Working toward becoming a Certified Receivables Compliance Professional (CRCP)? Want the latest information in the Chief Compliance Officer world? RMA has all this and more with live and pre-recorded webinars and in-person education at the 2018 Annual Conference in Las Vegas.
UPCOMING WEBINAR
- Why Are My Legal Bills So High? – Tuesday, December 19th, 2017
RECORDED WEBINARS: Did you miss a live webinar? All recorded monthly webinars are FREE to our members. Special series and select required courses for certification are paid at member rate.
CURRENT ISSUES IN DEBT BUYING (RE-CERTIFICATION ONLY): In addition to the two (2) hour education session at the Annual Conference and Executive Summit, RMA has identified the following recorded webinars which qualify for one (1) credit out of the four (4) credits of Current Issues in Debt Buying required for re-certification. Click to register.
- The CFPB’s New Enforcement Tool: Bankruptcy Code Section 105
- Getting Your Feet Wet: Purchasing a New Type of Debt
- Issues with Purchased Judgments
Congratulations to our renewed companies and individuals!
Renewed Companies
Capio Partners, LLC
Cascade Capital, LLC
CKS Financial
Converging Capital
Galaxy Asset Management, LLC
Galaxy Asset Purchasing, LLC
Galaxy Capital Acquisitions, LLC
Galaxy Capital Recoveries, LLC
Galaxy International Purchasing, LLC
Galaxy Portfolios, LLC
Gemini Capital Group, LLC
Phoenix Recovery Group, Inc.
NCB Management Services, Inc.
The Cadle Company
Worldwide Asset Purchasing II, LLC
Renewed Individuals
Victor Diaz, President, Diaz & Associates, Inc.
Bryan Hosto, Owner/CCO, Converging Capital, LLC
Adam Katz, Attorney, National Management Recovery Corp.
Jill Stanzione-Katz, President, National Management Recovery Corp.
Vincent Raphael, Director of Compliance, Galbo Sims Holdings, LLC
Franci Wayland, Senior Counsel, Compliance, Portfolio Recovery Associates, LLC
View all certified companies and certified individuals on our website.
For help with certification, contact Michelle Wren at (916) 482-2462 or [email protected].
Welcome new RMA members!
The RMA membership continues to grow. Welcome to our newest members:
Ally Bank – Originating Creditor – Minnesota
Fair Collections & Outsourcing, Inc. – Associate Debt Buyer – Maryland
Fusion Financial, LLC – Associate Debt Buyer – Florida
Green Mountain Capital, LLC – Associate Debt Buyer – Colorado
IQventures – Affiliate – Ohio
MedFinance Servicing – Associate Debt Buyer – Colorado
Sequium Asset Solutions, LLC – Associate Collection Agency – Georgia
Read more about these members and other members on the Member Search page
YOUR MEMBERSHIP INVESTMENT AT WORK
Expanding and opening new market opportunities
RMA’s leadership participated in several conferences in various asset classes during 2017 with the goal of developing new sources of business and partnerships to benefit members.
Online member directory
Locate business contacts and foster strong relationships.
Communication and education
Timely information via Member Alerts, this mid-month RMA Update newsletter, live conferences, live and recorded webinars, the bi-annual print RMA magazine and, of course, the team of knowledgeable and service-oriented RMA staff.
FREE webinars!
Live and recorded monthly training. Need extra Certification credit? Take advantage of the free training.
Representation
RMA knows the layout of the legislative battlefield, responds proactively on legislative bills and retains top tier lobbying firms when needed to protect the industry and promote fair and balanced legislation.
Attorneys General
We continue to meet with Attorneys General and their Consumer Protection staff to help them understand the industry and differentiate between the good participants and the outliers.
RENEWAL DEADLINE
December 31, 2017 … avoid a $100 late fee!
Annual Conference
Be part of the networking event of the year by sponsoring the SUITE CRAWL. Sponsors receive a suite in the Aria Sky Suites and co-host a traveling party on Wednesday night (2/7). A large percentage of conference attendees have already RSVP’ed for this event. Claim your opportunity for valuable face time with decision makers. A limited number of suites are available, so act fast!
Are you wondering what the 21st Annual Conference is all about? Visit our conference website here.
In this update:
Thank you 2017 Legislative Fund contributors. Your support allows us to influence threatening legislation, while also promoting and preserving the best interests of our members. Make your contribution today!
Titanium ($15,000)
Certified Debt Buyer
Cavalry Investments, LLC
Platinum ($10,000)
Certified Debt Buyer
Encore Capital Group
Associate Collection Agency
Financial Recovery Services, Inc.
Gold ($7,500)
Certified Debt Buyer
Unifund CCR LLC
Silver ($5,000)
Certified Debt Buyer
Crown Asset Management
Plaza Services, LLC
Velocity Portfolio Group
Associate Debt Buyer
U.S. Equities Corp.
Associate Collection Agency
Credit Control, LLC
Affiliate
Digital Recognition Network
National Loan Exchange NLEX
Bronze ($2,500)
Certified Debt Buyer
Galaxy Asset Management
Security Credit Services
Associate Collection Agency
Glass Mountain Capital
Associate Law Firm
Bedard Law Group, P.C.
Maurice Wutscher LLP
Affiliate
EZ Messenger
Brass ($1,000)
Certified Debt Buyer
Capital Alliance Financial
Collins Asset Group
First Financial Asset Management, Inc. FFAM360
Jormandy, LLC
Mjollnir Group
Resurgence Capital, LLC
The Bureaus, Inc.
The Cadle Company
Certified Collection Agency
Halsted Financial Services
Certified Law Firm
Peroutka, Miller, Klima & Peters, P.A.
Associate Debt Buyer
Balbec Capital
International Debt Buying Consultants, LLC dba Portfolio Management Group
Western States Financial Management, LLC
Associate Law Firm
Simmonds & Narita, LLP
The Law Offices of Ronald S. Canter, LLC
Vargo & Janson, P.C.
Affiliate
CMS Services
Full Circle Financial Services, LLC
VeriFacts, Inc.
Individual / Non-members
Century Support Services
Dara Tarkowski
Other
Certified Debt Buyer
Acctcorp International, Inc.
Atlantic Credit & Finance
Autovest, LLC
Cascade Capital, LLC
Gemini Capital Group, LLC
Investment Retrievers, Inc.
Jefferson Capital Systems
National Recovery Solutions, LLC
Poser Investments, Inc.
Troy Capital, LLC
USI Solutions, Inc.
West Bay Recovery, Inc.
Certified Broker
DebtTrader.com
Certified Collection Agency
Frontline Asset Strategies
Stoneleigh Recovery Associates
Certified Law Firm
G. Reynolds Sims & Associates, P.C.
Law Offices of Steven Cohen, LLC
Lawgix Lawyers, LLC
Associate Debt Buyer
Allen & Durrant Corp.
Alliance Credit Services
Convergence Acquisitions
Fair Collections & Outsourcing, Inc.
Genesis Recovery Services
National Check Resolution
Pharus Funding, LLC
Phoenix Asset Group, LLC
US Asset Management
Associate Collection Agency
A-1 Collection Service
Alpha Recovery Corp.
Capital Collection Management, LLC
Crisis Consulting and Marketing
DRS Processing, LLC
FMS, Inc.
Midwest Recovery Systems
Nationwide Credit & Collection, Inc.
SIMM Associates, Inc.
Superlative RM
TCF & Associates
Associate Law Firm
Butler & Associates, P.A.
Delev & Associates, LLC
Faloni & Associates, LLC
Harrington, Anderson & DeBlasio
Hunt & Henriques
Law Offices of Daniel C. Consuegra, P.L.
Malone Akerly Martin PLLC
Pressler and Pressler, LLP
Rausch, Sturm, Israel, Enerson & Hornik, LLC
Affiliate
Acumen Solutions Group
Comtronic Systems, LLC
Convoke, Inc.
Cornerstone Support
Debt Sales Partners
FLOCK Specialty Finance
Harvest Strategy Group
Metronome Financial, LLC
MicroBilt Corporation
MRS BPO, LLC
PCI Group Inc.
Resource Management Services, Inc.
SAM, Inc. – Solutions for Account Management
TransUnion
Vertican Technologies, Inc.
Y2Payment Systems, Inc.
Individuals / Non-members
Dan Crowley
David Reid
Greenberg Advisors
Jan Stieger
Mike Colby