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


I ≠Disclaimer


1FTC’s Enforcement Authority


• 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


• 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


• 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


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


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


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


• Data integrity and security

• Egregious collection practices

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

• Protecting vulnerable and underserved populations

Previous Priorities


New Priorities

• Data integrity and security

• Egregious collection practices

• Student loan debt collection

• CFPB rulemaking


FTC and CFPB v. Green Tree Servicing LLC


FTC v. Federal Check Processing, et al.


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


FTC and People of New York v. Vantage Point Services


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


Messaging for Money Sweep

Deceptive Door Opener Texts

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


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


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


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].


3FTC’s Debt Collection Business Education and Outreach Initiatives


Debt Collectionand the Latino Community


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


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


FTC’s Debt Collection Dialogue Events

BUFFALOJune 15

DALLASSept. 29

ATLANTANov. 18


The Debt Collection Hall of Shame

To date: 87 bans


Question and Answer4


Colin HectorAttorneyDivision of Financial PracticesFederal Trade [email protected]

Questions?

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