By: Valerie Hayes, ACA General Counsel and Vice President of Legal and Government Affairs
A few weeks ago, the Federal Trade Commission hosted an important workshop to examine the impacts of new technology on the ARM industry and consumer communication. The well-organized and informative workshop featured six expert panel discussions on how new technologies have changed the use of telephone technologies, e-mail, social media, industry software and regulation. Participants included the FTC, ACA International, DBA International, consumer advocates, consumer and collection attorneys, academia and researchers.
From ACA’s perspective, this critical dialogue was long overdue and an important step in the right direction to modernize debt collection laws to reflect the realities of how people communicate in 2011.
In 1978, the Fair Debt Collection Practices Act (FDCPA) began regulating the industry and how it communicates with consumers; and it was the last time the FDCPA was updated to reflect the use of technology. Thirty-three years ago, Jimmy Carter was president; video gamers were flocking to play the newly released “Space Invaders;” Americans listened to Grammy winner Billy Joel’s “Just the Way You Are” on eight-track players; and “The Deer Hunter” won the Oscar for best picture.
Flash forward to 1991, the Telephone Consumer Protection Act (TCPA) is enacted and prohibits the use of autodialers or an artificial or pre-recorded voice to make non-emergency calls to wireless phone numbers without the prior express consent of the called party. Twenty years ago, the internet was first made available to unrestricted commercial use with one million users and the television show “Seinfeld” made its debut on NBC.
Today, we rely on cell phones, the internet, social media and e-mail. The Pew Internet and American Life project reports that 85% of adults own a cell phone, and according to a recent report from the CDC, nearly 25% of American adults live in a home without a landline telephone. There are more than 90 trillion e-mails sent per year, an average of more than 247 billion per day, by more than 1.4 billion e-mail users worldwide. There are 253 million internet users in the United States. Add to it the growth of the internet and social media, including more than 350 million Facebook users.
Plain and simple, the FDCPA and TCPA were enacted for a different time and a different set of circumstances surpassed by today’s technology, economic realities and consumer preferences. A debt collector’s aim is to contact consumers via the method they have identified as preferable in compliance with federal and state collection laws. However, current federal and state collection laws are antiquated and don’t provide clarity on the use of new technologies in consumer communication.
Applying outdated or unclear laws to modern challenges predictably leads to poor outcomes for consumers and collectors alike. Federal and state law must provide clear direction in the wake of new technologies for collectors and consumers as to what constitutes acceptable means of communication. Ultimately, there needs to be consistency and balance in allowing debt collectors to operate and providing consumer protection. But, given the lack of legal clarity regarding the use of new technologies such as e-mail and Facebook to communicate with consumers, ACA advises its members that using these new methods is a highly risky proposition.
Who knew in 1978 or 1991 that by 2011, cell phones, smartphones, texting, e-mail, the internet and social media would become the dominant means for global communication or what the next 30 years bring as technology continues to evolve? What we do know today is that the debt collection industry has to be at the table as active participants in advocating for change with the Consumer Financial Protection Bureau, Congress, FTC and state policymakers and regulators.
ACA International will lead, but we can’t do it alone. Regardless of whether you are a debt collector or debt buyer, a member of ACA, DBA, NARCA, CLLA or another trade association, a vendor, attorney, creditor or just an interested party — be an active and engaged advocate. These changes are of paramount importance to the entire ARM industry and it is imperative to effectively leverage our collective strength and voice.