recent initiatives and priorities the federal trade commission’s debt collection program colin...

Recent Initiatives and Priorities

The Federal Trade Commission’sDebt Collection Program

Colin HectorAttorney

Division of Financial PracticesFederal Trade Commission

North American Collection Agency Regulatory Association 2015 Annual Conference

September 29, 2015

Federal Trade Commission

1. FTC’s enforcement authority

2. FTC debt collection strategic priorities and recent cases

3. FTC’s business education, outreach, and policy initiatives

4. Question and answer period

Presentation Overview

Federal Trade Commission

I ≠Disclaimer

Federal Trade Commission

1FTC’s Enforcement Authority

Federal Trade Commission

• Nearly 30 million or 15% of Americans have debt subject to third-party debt collection

• 88,300 complaints received in 2014– CFPB now engages in mediation attempts

A Nation of Debtors

Federal Trade Commission

• Enforcement– Section 5 of the FTC Act

(unfair/deceptive practices)– Fair Debt Collection

Practices Act (FDCPA)

• Rulemaking– No FDCPA rulemaking

• Consulting Role w/ CFPB

FTC Authority

Federal Trade Commission

• 13(b) actions, often seeking relief on an ex parte basis– Receivership over corporate entities– Freeze defendants’ assets– Immediate access to defendants’ business premises

• Civil penalty actions, referred to DOJ for filing– Generally reach out to company pre-filing– Often file complaint & settlement at same time

Approach in Litigation

Federal Trade Commission

2FTC’s Strategic Priorities for Debt Collection and Recent Enforcement Actions

Federal Trade Commission

In 2014:

– Filed 10 new cases against 56 different defendants

– Obtained nearly $140 million in judgments

– Banned 47 companies and individuals from the debt collection industry

Debt Collection is aMajor Priority for the FTC

Federal Trade Commission

In 2015:

– Have already filed 8 new cases against 37 different defendants

– Settled 5 cases and obtained $78,320,142 million in judgments

– Banned 18 companies and individuals from the debt collection industry

– More is on the way

Debt Collection is aMajor Priority for the FTC

Federal Trade Commission

• Data integrity and security

• Egregious collection practices

• Emerging technologies (e.g., social media, text messaging, email)

• Protecting vulnerable and underserved populations

Previous Priorities

Federal Trade Commission

New Priorities

• Data integrity and security

• Egregious collection practices

• Student loan debt collection

• CFPB rulemaking

Federal Trade Commission

FTC and CFPB v. Green Tree Servicing LLC

Federal Trade Commission

FTC v. Federal Check Processing, et al.

Federal Trade Commission

FTC and People of New York v. National Check Registry, et al.

Federal Trade Commission

FTC and People of New York v. Vantage Point Services

Federal Trade Commission

FTC and People of New York v. 4 Star Resolution, et al.

Federal Trade Commission

Messaging for Money Sweep

Deceptive Door Opener Texts

YOUR PAYMENT DECLINED WITH CARD ****-****-**** -5463 ... CALL 866.256.2117 IMMEDIATELY

Deceptive Door Opener Texts

YOUR PAYMENT FOR $[AMOUNT] IS SCHEDULED FOR [DATE]. CALL 866.257.2117 WITH ANY QUESTIONS OR CONCERNS

Deceptive Door Opener Texts

YOUR PAYMENT OF $[AMOUNT] IS SCHEDULED FOR [DATE]. CALL 866.257.2117 IF YOU WANT TO MAKE YOUR PAYMENT EARLY

Federal Trade Commission

False Litigation Threat Texts

I'm a process server w/ Primary Solutions, appointed to serve you papers for case [eight digit number]. Would you like delivery at [consumer's home address]?

Please have proper ID and witness present who can provide a signature. If there's no reply I'll have to bring the document to your employer.

It’s already been verified this is a contact number for [consumer's name] . So I just need an appropriate time and place to serve the papers when ready.

Check your call records, a recorded call from [number], verified this as the correct number. Indicating otherwise will be proof of deceptive practices. CB#: [phone number].

Federal Trade Commission

3FTC’s Debt Collection Business Education and Outreach Initiatives

Federal Trade Commission

Debt Collectionand the Latino Community

Federal Trade Commission

Do’s and Don’ts of Debt Collection Text Messaging: Business Blog

Federal Trade Commission

Data Security Guidance

FTC’s Business Center:business.ftc.gov

FTC’s Business Center:business.ftc.gov

CASES

VIDEO

REPORTS

BLOGS

GUIDES

FTC’s Business Blog:39 Debt Collection Posts to Date

Federal Trade Commission

FTC’s Debt Collection Dialogue Events

BUFFALOJune 15

DALLASSept. 29

ATLANTANov. 18

Federal Trade Commission

The Debt Collection Hall of Shame

To date: 87 bans

Federal Trade Commission

Question and Answer4

Federal Trade Commission

Colin HectorAttorneyDivision of Financial PracticesFederal Trade Commission202-326-3376chector@ftc.gov

Questions?