ACA International Pushes for Updates to ARM Rules and Laws

The largest trade association for accounts receivables management professionals has announced a formal set of policy recommendations for improving and modernizing the laws that govern debt collection activity.

ACA International is circulating the proposal, which contains the most specific policy recommendations to date, among key regulators and legislators at state and federal levels. The document, titled The Path Forward: ACA International’s Blueprint for Modernizing America’s Consumer Debt Collection System, includes recommendations centered around five key tracks:

• Use Modern Technology Responsibly
• Better, Simplified Communications with Consumers
• Advocate for Responsible Litigation in the Collection Industry
• Assure Proper Debt Documentation
• Adopt a Federal Seven-year Statute of Limitations for the use of Litigation to Collect Debts

“We believe the Blueprint will help consumers nationwide as the industry looks ahead to removing unnecessary barriers to effective communication in the debt collection process and reducing complaints,” said ACA International President Martin Sher.

The blueprint makes a number of recommendations on each track. For example, ACA notes under the “Use Modern Technology Responsibly” track that “Any functional difference between a cell phone and a residential landline has been eroded,” and the Fair Debt Collection Practices Act (FDCPA) and Telephone Consumer Protection Act (TCPA) should be updated to reflect this new reality.

A shorter version of the blueprint with the ACA’s recommendations can be found here.

The ACA argues that if a consumer has provided a debt collector with an email address or a phone number with an explicit permission to use it to text, the collector should be allowed to use those communication channels without fear of violation for third party disclosure. Likewise, ACA wants lawmakers to provide explicit language for collectors to use when leaving voicemails to erode the ambiguity over messages that leads to so many consumer lawsuits.

On the topic of debt collection litigation, the ACA takes a more nuanced approach that speaks directly to a number of current proposals that explicitly lay out requirements for necessary documentation to support a lawsuit. The association wants to hold courts accountable for stopping debt collection lawsuits that are filed without proper documentation.

“Rather than creating heightened and unreasonable requirements for a single litigant class to seek redress in court, rules of civil procedure and local court rules should offer greater clarification and direction to all litigants,” the group wrote. “Parties who bring suit without reasonable and acceptable evidence are acting in bad faith and should be held accountable for their actions to the opposing party and the courts.”

But ACA also acknowledged that frontline collectors and their leaders need to do a better job of complying with whatever changes are made to existing law and managing complaints that come from consumers.

“We will also actively provide education and training to help ACA members, and their employees, better understand how and why they need to prevent, manage and resolve consumer complaints,” said ACA Chief Executive Officer Patrick Morris. “Members must abide by a stringent code of ethics and those who engage in illegal activities should be held fully accountable to federal and state law.”

ACA reiterated its position that every member collection agency should have a designated employee, or department for larger companies, who handle complaints from consumers and that each of the alleged debtors the company is targeting should be made aware of the company’s complaint procedure.

ACA is hoping that the announcement will be a launch-off point of a concerted effort to lobby policymakers.

“ACA members will lead in working with lawmakers and regulators on state and federal issues including debt collection laws such as the Fair Debt Collection Practices Act, Telephone Consumer Protection Act and the Truth in Lending Act,” said ACA General Counsel and VP of Legal and Government Affairs Valerie Hayes. “Our aim is to collaborate with Congress, the Consumer Financial Protection Bureau, state attorneys general, regulators, lawmakers and others to create a balanced system for debt collection that allows a vital industry to function and protect consumers.”