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ConsumerFi Podcast: Omni-Channel Regulatory Compliance with Anastasia Caton of Hudson Cook

August 1, 2022

Episode 7


Joel continues his Omni-Channel breakdown with Anastasia Caton of the national law firm, Hudson Cook, to talk about Omni-Channel regulatory issues, social media and app-based communications and best practices to keep yourself safe from lawsuits.

ConsumerFi is presented by Nortridge Software: Loan Software That Accelerates Change

And special thanks to The National Automotive Finance Association: The only trade association exclusively serving the nonprime auto finance industry.


[00:00:20] Anastasia, how are you doing?

[00:00:22] Anastasia Caton: [00:00:22] I’m doing well. How are you?

[00:00:22] Joel Kennedy: [00:00:22] I’m good. So folks, Anastasia Katan is a partner with Hudson cook. Um, and she advises, uh, her clients on a number of things and I’m going to butcher it. So I’m going to ask you Anastasia, can you kind of give us a little bit of your, your background and, and you know, the stuff that you’re working on now, and maybe some areas that you’re really passionate about.

[00:00:44] Anastasia Caton: [00:00:44] Yeah, sure. So thanks for having me. Um, my practice, the Hudson cook. Well, I’ll back up has the cook is a consumer financial services law firms. So we primarily work in the consumer financial services space. Um, and my practice that hasn’t cooked [00:01:00] is focused on servicing debt collection, repossession, um, some credit reporting as well.

[00:01:06] And, um, I also assist clients in handling, um, federal investigations from agencies like the FTC and the CFPB, as well as state attorney general investigations, which, um, I think people are surprised to learn, have been happening with a lot more frequency than, um, than ever. So, uh, You get busy with those, with those areas of my practice.

[00:01:27] Um, before coming to Hudson cook, I worked at us bank, uh, in regulatory compliance that us bank handling, uh, debt collection and bankruptcy issues in the wake of the foreclosure crisis, which was, um, an exciting time to be doing consumer financial services work. And, um, I speak and write frequently on the topics of servicing that collection.

[00:01:47] So you’d probably see my articles floating around on the internet. So that’s. A little bit about me.

[00:01:54] Joel Kennedy: [00:01:54] Well, it’s so awesome to have you. So our topic today is omni-channel, [00:02:00] uh, and the regulatory issues that surround it. So for folks that don’t know, I’m going to try to define it, but if I’m wrong, you, you feel free to chime in.

[00:02:08] But when I think of omni-channel, I, you know, there’s the kind of cliche, Oh, I can talk to you anytime, any place in the manner and fashion that’s most preferred to you, but then when you think about the execution. That’s when I think about some of the complexity that can come. So I’m on my phone. I start shopping for a car.

[00:02:27] I find the vehicle that I like. It points me to a dealership. I then go into the dealership, perhaps I’ve completed an app on the phone or on my laptop go to the dealership. They somehow have some of this information. Maybe I credential myself there. They’re able to see some of my info. Maybe it auto-populates an app.

[00:02:44] Then it gets submitted. I get financing. And now, you know, think of it as seamlessly flowing through to that, to that servicer. Now maybe I have some other, an app on my phone or other things, but I have this variety of ways. To engage with you and the [00:03:00] channels are kind of agnostic as to the information that you have, and my ability to conduct business.

[00:03:07] It’s not that you’re just forcing me down a certain pathway. I have to call you, or I have to pay with a check. There’s a myriad of things that I can do along those lines. Did I butcher that?

[00:03:18] Anastasia Caton: [00:03:18] I don’t think so. And I also sort of feel like. I mean, from my perspective omni-channel is not a legal term. So it just sort of means it just sort of reflects what the industry does.

[00:03:29] And so it will probably change over time. Um, you know, in servicing collection, we know that, um, customers. Starting its customer base. The customer base is froze younger and younger, or the generation of customer, uh, customers that like to communicate via text message, email, um, app based notifications. That generation is becoming larger and larger share of the customer population.

[00:03:55] You know, we know that that is their preferred sort of channel for, [00:04:00] um, for talking to businesses that they interact with. So, um, you know, from my perspective, yes, it is, it is these various ways of communicating and it’s the fact that the customer can have a pretty seamless experience on their terms. Um, you know, without.

[00:04:16] Yeah, without having to open their mail and without having to talk to someone on the phone cause you know, millennials hate talking on the phone. Um, so yeah, I think you hit the nail on the head in terms of what on each channel communication is great.

[00:04:29] Joel Kennedy: [00:04:29] So I think about a couple of, of specific points, um, along the pathway, operationally speaking.

[00:04:35] So I get questions from folks about how much do I really need to mail stuff? To to consumers. Right? So I think of you can have an adverse action letter. Can I text it? Can I email it, all these things, these are a lot of the questions that folks have, and then obviously that, that rolls through to the servicing side.

[00:04:54] So, you know, generally speaking top level, You know, when people say, you know, [00:05:00] is what are the channels that are okay from a, generally from a compliance standpoint, are there any things where it’s like, Hey, this is just strictly verboten or these things have to be in paper, you know? W what, what should people be thinking about when they kind of embrace some of these new technologies?

[00:05:14] Anastasia Caton: [00:05:14] So, um, You know, the, the federal trade commission in the consumer financial protection Bureau have been pretty clear that there’s not a, that these forms of communication other than paper and telephone are fine to use. So it’s fine to text customers. It’s fine to email them and attempt to collect the debt.

[00:05:34] It’s fine to use app based communications to collect debts from consumers. It’s in fact, the CFPB has even gone so far as say, it’s okay to use social media, to communicate with consumers about debt. But they’ve, they’ve been abundantly clear that, um, all the same rules are going to apply. So just because you’re using text messages doesn’t mean you don’t have to comply with the limits on contact frequency.

[00:05:57] It doesn’t mean that you’re exempt from [00:06:00] the rules about, um, not revealing the existence of the debt to a third party. That’s

[00:06:04] Joel Kennedy: [00:06:04] the big one. That’s the big one in my mind is, is, is not disclosing it through a third party.

[00:06:08] Anastasia Caton: [00:06:08] Yeah. And that’s, uh, I mean that to me and in what I deal with with clients that is probably the largest risk area.

[00:06:16] When we talk to clients about these types of communications, because you know, a lot of times they’re the customers on a device that their employer can, can see what’s going on that device. Perhaps there they’ve provided you with a work, email address and their employer. Hasn’t a right to, or doesn’t fact monitor their work email.

[00:06:38] So perhaps they’re sharing with family members. I mean, you know, members of my family, where everyone has like the same iCloud accounts, you text one of them. And they like, um,

[00:06:52] makes a very interesting conversation, but you know, those types of considerations. It’s hard to know when you’re communicating with [00:07:00] the customer, how many other people you’re exposing this communication to even just having your, someone, having their phone out on the table. I mean, we’re not really gathering in social settings right now, but you have your dinner with friends and your phone is face up on the table and then notification comes through and the text of the notification is visible.

[00:07:18] Right there on the screen, then everyone’s sitting around, can see, Oh, this is an attempt to collect a debt. So you know that those are all, um, that I agree with you. That is probably the biggest risk area for clients that I work with because a lot of clients have, I think, have, have gotten. The, the excessive frequency under control.

[00:07:40] They know these messages, usually aren’t very long, depending on, um, on a vacation. So they’re not necessarily like going to be engaged in deceptive making deceptive statements when they, um, send these communications. So it really is. How do you guard against this risk of third-party [00:08:00] disclosure and. The federal agencies have been pretty clear that they, that they know the risk is there and that they expect at least debt collectors to guard against the risks.

[00:08:12] And I’m guessing senior podcasts are not debt collectors subject to the federal PCP, but we do know that the federal agencies refer to the FCCPA as sort of a framework for regulating predators, collecting their own data, because it really is, you know, I just listed on unfair, deceptive or abusive acts or practices.

[00:08:31] And. With a few exceptions. It’s, it’s pretty, it’s basically a UDA standard. And so, um, you know, we know with respect to debt collectors, that the CFPB is thinking about third party disclosure risks in, in, in the context of omni-channel communications.

[00:08:47] Joel Kennedy: [00:08:47] Yeah. And, and to, to clarify for the folks that are in the non-prime market, that probably don’t meet the classic definition as a debt collector.

[00:08:55] Um, It, what I’ve, what I’ve actually observed Anastasia is that people [00:09:00] tend to yield to the higher standard, um, just to be very protective of, of their, their business and the customer’s rights as well. So, you know, what are the questions that I had down was can you safely email and texts to collect a debt?

[00:09:14] I think you already answered it. And the answer is yes. As long as you can. You control for the third party disclosure. And then there was, there was another item that I think you threw in as well. Yeah,

[00:09:25] Anastasia Caton: [00:09:25] the other, I mean, it’s, it’s all the, it’s all the typical rules that apply when you’re collecting debt.

[00:09:31] So you don’t want to communicate with excessive frequency. So it’s probably not a good idea in the context of text messages, for example, um, to send like five text messages in a row to a customer because. Once they’ve received that first message you’ve communicated with them, you’ve reached them. And so what’s the reason to send all these subsequent messages.

[00:09:54] Um, so, so far, and I know, you know, it’s very easy to send a bunch of text messages in a row it’s different than phone [00:10:00] calls, right? Like a phone call. Um, you normally had the, you have the customers lined up in the queue and the collectors calling one at a time and it’s a drain on resources. They can’t call another customer.

[00:10:09] If they’re calling. Um, you know, one customer buy, it comes in a row. So it is, it’s a different, it’s easy to do to send a lot of text messages, but it’s something I have to exercise some restraint because there is a very real risk of being accused of harassment or excessive text messaging. Um, and then, you know, the content of the messages, shouldn’t be, it shouldn’t contain.

[00:10:32] Deceptive language. It shouldn’t, um, say anything that’s abusive or harassing, you know, you don’t want to curse at customers in text message. I think a lot of it is straightforward, but a lot of it is it requires thinking through how are these messages different than what the FTC PA sought to regulate when it was passed and or signed into law in the 1970s?

[00:10:54] And what, what could fuel your things are going on in this. Space that, um, that we need [00:11:00] to think about.

[00:11:01] Joel Kennedy: [00:11:01] Yeah. I remember the days when I had a, you know, it’d be a refining, a mortgage or something, and I had to run over to get a paper off the fax machine because I didn’t want anybody else to see it. I mean, this is, this is, this is what people were dealing with back then.

[00:11:15] But now we have these things, like we were talking earlier about, um, some of these, uh, You know, customer apps, right? I can, I can basically create a customer profile and display all of their prior payments and all this stuff on an app. You know, how have those been brought into discussion with any of the regulators?

[00:11:34] Are there specific regulations that come into play with those?

[00:11:37] Anastasia Caton: [00:11:37] Um, not that I don’t think I’ve seen. Um, w with creditors, um, I don’t think I’ve seen since certainly the federal level with respect to creditors. There’s not really specific federal law, regulating creditors collection practices. And then at the state level, I’m not aware of any laws that are specific to app based collection [00:12:00] communications.

[00:12:00] Um, but you know, the, the, the, the consumer financial protection Bureau promulgated a proposed rule on debt collection last year. And they got into some specifics about, um, Omni channel communication in the context of debt collection. And they didn’t go into detail about app based communications, but I think we can infer, um, that we know what they were trying to do is create a framework that allows.

[00:12:27] For different types of technology to continue to emerge and to be regulated in a reasonable way. Um, we know they were thinking about that when they promulgated their role. So while there’s not an end, I apologize for not knowing whether there’s a specific mention of app based communications in the proposals, but there are, um, takeaways, I think, from the proposals.

[00:12:51] That we can pretty easily apply to app based communication. So, um, So, for [00:13:00] example, um, you want to take into account convenient time and place. What’s a commuting time place to communicate with this customer. And the Bureau has said that with an electronic communication, you need to assume that the customer received the communication.

[00:13:14] When you send it. So that one, one thing to think about is, am I batching push notifications and sending them at midnight? Because if so, that’s potentially an inconvenient time to communicate with most of my customers. Um, other things, um, you know, for social media communications, the Bureau is clear that you can’t make you can’t publicly communicate with customers on social media.

[00:13:38] So you can’t. You know, post on their Facebook wall about the debt, but you can privately talk with them on social media, so you can send them a key. You can send direct messages to customers on social media, and there are some safe harbors to protect against the risk of third party disclosures. But I think those are really specific to text message and email communications.

[00:13:58] So for the most part, um, [00:14:00] when it comes to app based communications, we’re really looking at like, Sort of regulatory and it is all the same sort of at DCPA type considerations when it comes to APICS communications. So third party disclosure risks. No, don’t, don’t put deceptive content in the messages. Um, you know, you don’t want to message.

[00:14:22] It’s a notification clicks as a frequency or the convenient times or places. Um, And, you know, to the extent that, um, uh, state law, for example, might require specific disclosures, you want to consider how you would make those disclosures in the context of a push notification.

[00:14:38] Joel Kennedy: [00:14:38] Um, what are some examples of some of those?

[00:14:41] Yeah. Like what are some examples of disclosure? I think of a mini Miranda, but you may tell me that that’s not actually not about I’ll let you talk. What are some examples of some of those disclosures?

[00:14:51] Anastasia Caton: [00:14:51] No, you’re absolutely right. Mini Miranda is a big one. Um, others sort of, I think eat much easier to comply with.

[00:14:57] So, you know, you have to tape that requires [00:15:00] disclosure of your office hours or, um, the name of the creditor and who’s to have for collecting, which is often, you know, in the creditor context is going to be yourself. Um, you’ll have disclosures like, um, the creditor’s phone number. Those are pretty easy, I think, to put in a text message or a notification, but like you say, the mini Miranda is the trickier one.

[00:15:20] Yeah. And for the folks that are listening, I mean, you, Miranda is it essentially says it’s an attempt to collect a debt. This is a. Attempt to collect a debt by a debt collector, and any information obtained will be used for that purpose. So you have sort of two concerns here when you put this type of warning in, um, in a text notification or even an email, um, one, you could potentially reveal the existence of the debt to a third party because by its terms this morning says.

[00:15:53] This is an attempt to collect a debt. Um, the second consideration in particular in apps and, um, text [00:16:00] messages is that it’s a long morning. And so you’ve got new. Do you want to have. One long message that has this morning at the end, or do you want to break it up into multiple messages and then you run into that same issue of, um, you know, you’re sending too many messages in a row or do you want to put it in a link?

[00:16:21] And if you put in a link, is that sufficient? With whatever state law requirement there is for providing these disclosures. A lot of us depends on what your risk tolerance is and what exactly the state says about the disclosure, because there’s a handful for creditors, just a small handful of States that require them any Marine debt.

[00:16:40] But the triggers are all different. They don’t all look the same. So if you’re operating in every state you want to consider, how do I, how can I get this? You know, what’s my risk when it comes to their freight exposure. What’s my risk. When it comes to complying with this particular provision of state law and how do I best deliver this message to the [00:17:00] customer?

[00:17:00] Um, and just charge my compliance obligations. So the disclosure is, I feel like I’ve spent. I don’t know, hours and hours and hours and hours of science working through these types of disclosures, because it’s just, these laws were not designed for this environment. They were faxes and letters and phone calls.

[00:17:22] Um, not for, for a tiny computer that sits

[00:17:26] Joel Kennedy: [00:17:26] in your pocket. So I definitely pick up like, so if I was somebody who didn’t really have much, omni-channel built out operationally and I want to embark upon that. I know for example, the same controls that I have with making phone calls. For the dialer or for, you know, hitting certain numbers.

[00:17:42] Okay. We hit this number today. We’re not going to hit it again. We left a message. We’re done. I think about putting controls around the other communication methods, such as email and texting. So you want to have some of those controls in place so that you can show that you’re exercising management over it and that people aren’t just.

[00:17:58] Free to just go Willy nilly. [00:18:00] What are some of the other like bigger laws? Like if I was, if I was saying, okay, I’m going to go down this path and I’m the COO. Um, but I want to make sure I’m covering all my bases with all the different major regs. Like what are the other major regs that you think of aside from you?

[00:18:15] Anastasia Caton: [00:18:15] Yeah. So you had a, a really big one, mentioned the dialer. Um, so. The telephone consumer protection act TCPA also, um, it doesn’t seem like an old law, but now that we’re trying to fit text messages into it, it has become a very old law in terms of Fez and what it regulates. So the TCPA requires, um, requires a color when you’re communicating with someone on their cell phone, using a device that’s considered to be an autodialer.

[00:18:49] Requires the caller to, um, get a certain level of consent from the person they’re dialing using the autodialer. And depending on the nature of the call, you consent [00:19:00] either has to be in writing or it doesn’t be in writing. You just have to be a higher express consent. It’s a best practice. So to always get these consents and right thing, because you, the color or the burden of proving, if you’re sued, which you look at, Sue, you bear the burden of proving that you have the appropriate consent.

[00:19:18] And so. The federal communications commission, um, interprets the TCPA and enforces the pay. And they have said that text messages are subject to the TCPA requirements. So what that means for a creditor that wants to send text messages to its customers, is that. In all likelihood, unless you’re most your collectors are using their own cell phones to text customers, which is a whole different issue.

[00:19:43] And I would strongly advise

[00:19:48] Joel Kennedy: [00:19:48] don’t do that at home.

[00:19:51] Anastasia Caton: [00:19:51] Like you pointed out there, you have almost no control over what’s going on and you don’t strongly advise against that. Um, but [00:20:00] you know, in all likelihood that you are using something, that’s going to be considered an autodialer. You can get with the consumer or the plaintiff over that all you want.

[00:20:09] But I think you, when it comes to compliance, especially to just develop a compliance program that assumes that you’re using an autodialer get the appropriate consents. And then, um, once you have the consents in place, From there, you have to honor the customer’s request to opt out and reasonable request to opt out.

[00:20:27] So we see this all the time. When we get text messages from political campaigns or from businesses, they’ll say, um, to opt out reply, stop. And that’s, that’s the TCPA in real life, um, inaction. So, you know, you have to give a, uh, opportunity for the customer to opt out and you have to honor their opt out.

[00:20:46] Pretty much in the, in the text message context. It’s, it’s the best practice just to honor it immediately. Um, and you know, No matter how good your compliance is in TCP, you are going to get sued. Um, there’s [00:21:00] no, there’s hardly any way around getting senior, no TCK, cause it’s a very lucrative statute for plaintiff’s bar.

[00:21:07] Um, but that being said, I think most clients that I work with are comfortable with that risk because it just is just a superior way to communicate with consumers and more and more consumers are preferring. Yeah, that method of communication there, more people prefer it, then you’re going to Sue them over it.

[00:21:26] Joel Kennedy: [00:21:26] Yeah. I mean, if I was going to spend time in any one place, if I was back in a COO position, I would take a good hard look at the controls in place to protect you from those TCPA violations. In my case, I had a weak control. At my last auto finance company, I thought it was sufficient enough. And it had to do with, you know, the, the, the agent, you know, when they get a notification that somebody doesn’t want to be touched anymore, that they just update the system of record seems easy enough.

[00:21:57] Um, and I want it to remove any [00:22:00] resistance, right? Any points of resistance for the consumer to actually make that request and have it at haired too. Well, you forget to click the box and then next thing you know, the customer doesn’t say anything, customer doesn’t say anything. I’ll let you just call them and call them and call them.

[00:22:12] And then when they accumulate enough, they go to your plaintiff’s bar guy down in Louisiana. And all of a sudden, Hey, we got this one. And you know, there was more common. You know, they’re going to go and fish for more people. So, um, yeah, these are the things that we’re protecting ourselves against and TCPA has painful violation, right?

[00:22:28] It’s it’s painful. It’s a, what is it? It’s, it’s a PIR. Like per instance type thing. It’s, it’s financial, you know, you get hit with like a couple thousand bucks per, per instance or something like that. Did you?

[00:22:43] Anastasia Caton: [00:22:43] I don’t know. Off the top of my head. It’s bad.

[00:22:45] Joel Kennedy: [00:22:45] It’s bad. Don’t do it.

[00:22:50] Anastasia Caton: [00:22:50] Um, colleagues here that I go to for questions like that, but, um, it’s bad. Yeah. I’ve. You know, if you’re a successful, um, class action [00:23:00] and TCK is not, uh, anything that any. Creditor or debt collector is, you know, looks forward to pain that the judgment in now,

[00:23:10] Joel Kennedy: [00:23:10] are there any, um, you mentioned earlier, uh, about maybe some recent updates or changes to the regulatory landscape, um, you mentioned a CFPB rule or a bolt in that came out last year.

[00:23:21] Um, that puts a little more clarity around some of these alternate methods. Um, Are there any other enhancements of note or pending enhancements you’d like to you think would be helpful for people to just keep an eye on or, or make sure that they go back double double-check their operations and that they’ve got good coverage.

[00:23:41] Anastasia Caton: [00:23:41] Yeah. So I’ll speak about the CFPB stuff because, um, that is at this point, all we know that it’s coming, even though it probably doesn’t apply to most people listening, I think it’s worth noting because. You know, you could see a state like California. Um, if something [00:24:00] similar for creditors since California Rosenthal act does regulate creditors very similarly to the FTC PA.

[00:24:06] So. The CFPB is, um, notice of proposed rulemaking, which in the federal rulemaking, um, landscape that is, uh, close to as close to a final role as you’re going to get. The final rule is expected anytime this month, like by the time this podcast is released, we could have the final rule from the CFPB on debt collection.

[00:24:30] Um, and we expect it to be pretty similar to the proposed rule, which was issued in the late spring, early summer of last year. Um, and the, the CFPB took great pains to think. I think about how the customers want to be communicated with in this context. And, um, how can they create a flexible regulatory environment for, um, the businesses that want to communicate with consumers in this way?

[00:24:57] And so, One thing to keep in mind [00:25:00] though, is that these rules are very specific to debt.

[00:25:04] Joel Kennedy: [00:25:04] Very good point. I was going to mention that. Thank you. Yeah. Yeah.

[00:25:07] Anastasia Caton: [00:25:07] So these are, these are companies that don’t have a customer service relationship with consumers. So, um, the incentives, I think are a little different for debt collectors, which is often when we see much stricter regulation of them.

[00:25:19] Also the types of debt they’re collecting is it’s you sort of have converged on one main type of debt that debt collectors collect, and that’s usually an unsecured claim. Um, so there’s not necessarily the threat of repossession. That’s not to say that that’s always the case, but oftentimes the debt collection industry is collecting on a judgment or, um, like a deficiency balance that some secured or credit card balances, I’m just unsecured.

[00:25:48] So. They’re not necessarily, there’s not the threat of pending repossession. So you don’t have the level of urgency that, um, a lot of secured creditors have when you’re trying to reach their customers. So those are [00:26:00] all. The sort of things to keep in mind for why we think that the CPB is going to look differently at creditors in the art ducks lectures.

[00:26:08] Um, these rules are very technical. That’s another issue. They’re very technical. So we don’t expect them to necessarily apply these specific rules to creditors because of how technical they are. And the Bureau has never. Try to enforce technical provisions of the statute of the FTCA and its creditors by taking their own debt.

[00:26:26] So they don’t expect creditors to provide immunity, Miranda warning under, under federal law. They might have to prevalent under state law, but the Bureau doesn’t deal with state law and the predators comply with the debt validation requirements in federal law. So setting the stage there I’ll go into what the rule says or what the proposal says.

[00:26:45] Um, just understanding that there are many, many reasons why. I don’t think the clutter necessarily is to like go back and rewrite its compliance management system when it comes out. Um, so the first one is [00:27:00] the considerations for convenient time and place. Um, you know, debt collectors need to consider, I mentioned earlier, but definitely crispier consider when you’re spending communication.

[00:27:11] Um, the Bureau is going to consider it received when it’s sent. So, um, you know, it’s not like you it’s considered received when the customer actually opens their, unlocks their phone in the morning or whatever the case may be it’s considered received when you send it restrictions on work emails. So the Bureau has.

[00:27:31] Specifically said that they don’t want debt collectors to communicate with consumers on their work email. If they know it’s their work email or should know it’s their work email without specific consent from the customer, um, social media requirements. So, no, no, um, no public social media communications.

[00:27:49] I mentioned that already don’t post on customers’ malls, um, messaged with them privately. And then there’s, um, a requirement to allow customers to opt out [00:28:00] of text message communications. It’s not, it’s not having looked at it in awhile, but I don’t think that that part is too off base or too different than what the TCPA requires.

[00:28:10] But on the, if there’s also a permit to have filled out customers to opt out of email communications, which is, um, brand new, um, and that’s a, that’s a pretty technical requirement to have, have consumers opt to of email communications. And then they’ve created this pretty technical, complicated, safe Harper regime to protect against third party disclosure risks.

[00:28:31] Um, and so the, the debt collector has a take all these steps before they can communicate with a customer via text message or email. But if they do that, then they will presume to have not just those, the debt to a third party. So it’s helpful for debt collector in way, but we know that it’s probably going to be helpful for larger.

[00:28:50] Debt collectors who can get their compliance management systems and shape and comply with these rules pretty easily, um, and help avoid no one [00:29:00] enforcement action. So those are, um, of that list. I think. The last two, I mentioned the requirements for opt-outs and the safe Harbor tape protecting and third-party disclosure risk.

[00:29:10] Those are definitely very specific to debt collectors. The first three are potentially something we could see that the Bureau enforcing against creditors because those tend to the more like unfair, deceptive, abusive, um, standards that the Bureau ordinarily enforces against creditors.

[00:29:31] Joel Kennedy: [00:29:31] All right. So last question to bring it home.

[00:29:33] And this is, this has been outstanding. Anastasia, thank you so much for your time. Um, are there any best practices that you’ve been observing? You know, and I think, I think, you know, seasonally about what’s going on with COVID and the pandemic. I know a lot of creditors have offered significant forbearance.

[00:29:51] Uh, even on top of the government stimulus and as we look to fourth quarter and through next year, we’re already seeing delinquencies start, [00:30:00] start to pick up a little bit. Um, are there any best practices that you’ve seen or heard, you know, during this whole thing? I mean, from the debt collector side, or even from the creditor

[00:30:10] Anastasia Caton: [00:30:10] side, Yeah.

[00:30:11] So, um, I think even since the last time you and I spoke circumstances have changed. Cause it looks like there’s not going to be another stimulus package this year. So we probably are going to see an acceleration of defaults from customers and then potentially more job losses. Um, So, you know, I think on the, um, payment, accommodation side, it’s definitely, you know, I think a lot of creditors were sort of acting on the fly in the, in the spring and summer when they were offering human accommodations.

[00:30:43] Which was probably okay to do because he probably didn’t have in place a pandemic plan end of the servicing. Um, but you know, looking now at what potentially is coming, it may or may not make sense to use your ordinary payment [00:31:00] accommodation plans. Or if you have, uh, you know, your typical payment extension plan, it may or may not be appropriate to use that.

[00:31:07] You may want to go back to what you had implemented during the pandemic, but regardless of what path you choose, um, it’s important to document everything. And that’s, that’s the big thing we’ve been talking to clients about on the teen accommodation piece. And when I sit here in accommodations, I’m referring to.

[00:31:25] Deferral extensions, um, due date changes and anything that makes it easier for the customer to make their payments or keeps them from being in their car repossessed. So, you know, on that side of things, whether, again, whether you need to follow your established procedures, decide to follow your established procedures, or whether you go outside of them, it’s important to document why you’re doing what you’re doing.

[00:31:48] It may be good to get some guidance in place. Think about what worked, what didn’t work in the spring and summer. And think about what you might want to use this time around, because I think there’s a lot of economic hardship, [00:32:00] unfortunately coming down the pike and, um, and it, it would be good. You know, I think creditors have a little more time to prepare or have a little more notice this time around.

[00:32:09] So you might want to have stuff in place, have the right. Programs in place this time around. Um, and then the second piece is a customer communication piece. And so I’ve been talking to clients about, um, you know, do we need to do, do you need to change how you’re communicating with customers right now?

[00:32:31] And we know, and, and you and I had talked about this, we know that, um, a lot of, a lot of consumers are out of work potentially, or they’ve changed jobs. They’re working in different schedule because they’re working from home. Um, I think virtual schooling of their children. Um, so there’s all kinds of changes to daily life that are happening now, or that have happened in the last six months that can affect how consumers want to be [00:33:00] communicated with.

[00:33:01] And so those are things you want to check in with. I’m going to be sending you to be sensitive, to. What they’re going through and what they’re dealing with, but also, you know, ask them what’s, what’s the best way to get in touch with you? Is there a good, you know, has your schedule changed? Have your circumstances changed?

[00:33:17] Is there a time that’s inconvenient? Are there times that are coming in? Is there a method of communication that you prefer? For now. And you want to check in more frequently on these types of issues because things are changing so rapidly. Um, you know, they could, one day they could have a completely normal schedule the next day they could be caring for a sick relative.

[00:33:35] So, um, you know, keeping, keeping in touch with them, keeping a light, but keeping in touch so you can understand what they need going forward. I think is really important as we head into probably what’s going to be a surge in a virus. In the beginning of the winter time and, um, potentially a very serious economic hardship.

[00:33:57] Joel Kennedy: [00:33:57] Yeah. I agree with that. I mean, and this is [00:34:00] no by no means or way for us to paint any kind of picture of fear. Um, we just, I mean, in looking at the data and seeing these things kind of picking up, I think, you know, the. It’s going to have to settle out, right. It’s going to have to settle out and, you know, as much as we can do to make it be a softer landing as possible, you know, we should, we should certainly do it.

[00:34:18] The, the beauty of the non-prime lenders, that we’ve pretty much seen it all. I mean, we’ve been through economic cycles. We’ve been through consumer unemployment and the rest of it. Um, I’ve never seen the extensions, you know, the extensions within the ABS’s, uh, within non-prime, which usually float around 5% spite to 25%.

[00:34:37] And, but they’re coming back down and they’re going to settle in. And so as these things settle in and as the entire. I mean the entire ecosystem you look at that used used vehicle inventories or recovery values, all these things have been disrupted. So these things are all gonna have to settle out. Um, so I love, I love the guidance on, on kind of having a more caring [00:35:00] approach and checking in more frequently.

[00:35:01] I mean, I think that’s what we’re all doing with each other during the pandemic. Anyway, just getting that head check and checking in with the customers. So, um, Well, anesthesia, this has been fantastic. Thank you so much for the time. Folks Anastasia KA Kayden is with the law offices of Hudson cook. Um, I’m partial because I’m with the NAF and we do a great deal of stuff with Hudson cook.

[00:35:22] We have, um, what I consider to be the best, uh, the best compliance training available. And, uh, and you, you would expect to see the best people at the Hudson cook, uh, offices as well. And anesthesia is no exception. Anesthesia. Thank you so much for joining us today. Thanks for

[00:35:37] Anastasia Caton: [00:35:37] helping me. Joel’s good talking to you.

[00:35:40] Joel Kennedy: [00:35:40] The consumer five podcast has been brought to you by Northbridge loan software. That accelerates change. We’d also like to thank the national automotive finance association, the only trade association, exclusively serving the non-prime auto financing industry. [00:36:00]

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