Best Practices

Collector CallsNotices and Required DisclosuresTrust Accounts

Richard Dumais (MA)

Jeff Hubbell (CT)

Garrett Young (MA)

Agenda

Collector Calls

Collection Notices

Required Disclosures

Role Play

Trust Accounts

Q & A

Additional Information/Contacts

FDCPA Mini Miranda

This communication is from a debt collector and is an attempt to collect a debt. Any information that you provide to us will be used for such purpose.

Collector Call Documentation

Notes, Logs Letter History Payment History Recordings

Collector Calls - Triggers

Dialogue Dispute -code

Post dated Payment – notices

Series of Payments arranged

Third party involvement – code

Someone upset

Time of day included in account history – pattern identification

Number of times called [pattern identification

Bankruptcy - code

Selection Criteria

Represent a cross section of accounts

Industries

Calls from multiple call centers

Payment Types

Major Clients

Account comments

Call Checklist

Phone Monitoring Check List

Triggers

Action Codes

NTNote Only

OPOther Phone

SCSupervisor Call

TETelephoned

Employer

TNTelephoned

Neighbor

TRTelephoned

Residence

Result Codes

AM Answering Machine

LB Line Busy

LM Left Message

NA No Answer

TT Talked To

WN Wrong or NonPub #

Verifying Debtor

First and last name

Birthday, address

Last 4 digits of social security #

Follow-up Calls – Account #

Right Party Consideration

Debtor Answers Phone Failure to disclose to debtor that the call is from a debt

collector and all communication will be used for that purpose Collector fails to disclose personal name Obscene/profane language Threats Announcement that collector will take action they do not

intend or legally cannot take action. False representation about debt (amount, legal status)

Calls

Third Party Answers Call

Failure to disclose agency name

Collector fails to disclose personal name

Disclose name of licensee in absence of express request

Disclose there is a debt

Discuss debt

Multiple communication to third party

Wrong #

Role Play

Collection Notices

Initial contact validation Notice

Notice of Intent to deposit

More than 5 days must send notice 3-10 days in advance

Recurring written authorization for EFT

NSF letter

Broken promise notice

Settlement letter

Trust Accounts

Benefit of Protocols & Exams - SRR

Sample Trust account

Copies of statements/checks

Age of checks

Date of check

Are you in balance

Co-mingling

Sweeps

Negative balance

Transfers

TRUST ACCOUNT EXAMINATION PROCEDURES

  

WHY 

Many states require that a licensee maintain a trust account if a collection agency receives or holds funds belonging to another entity. Additionally, many clients require separate trust accounts. These funds are required to be separate from those utilized in the operation of the business, therefore the licensee must also maintain a separate operating account in order to function.

 All accounts, including the operating account, should be reviewed from the prospective that if any of the accounts are mismanaged, the business, client and most importantly the debtors could be compromised. 

Conceptually - verification of a debtor being credited for having made a payment cannot be confirmed without ensuring the payment information has been reported and credited to the client. Procedurally, one of the best ways to accomplish this is through the reconciliation of the trust account(s) by verifying that all remittances have cleared, thereby knowing that the client has received some form of a report identifying payments made. 

Nuts & Bolts

Verify that the Trust Account Balance Covers the Total Amount Due to Clients

Verify the Proper Use of the Trust Account

Verify the Accuracy of the RecordsThe first thing to do is determine if the trust account has sufficient funds to cover the amount due to clients from debtor payments received. If the account is substantially out of balance “OUT OF TRUST” this is a serious issue that will need to be addressed with your line of supervision. In practice, this process is really no different than balancing your own check book, just with much larger dollars and volumes.

Questions

Additional Info Websites

www.nacaraweb.org www.ftc.gov

Contact Information Rick Dumais

Richard.Dumais@state.ma.us 617-956-1500 Ext. 662

Jeff Hubbell Jeffrey.Hubbell@ct.gov 860-240-8205

Garrett Young Garrett.Young@state.ma.us 617-956-1500 ext. 626