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Addressing the CFPB’s Contact Attempt Limitations

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October 14, 2016
By: LiveVox

As an ARM executive, you are most likely seeking ways to prepare your business for the Consumer Financial Protection Bureau’s (CFPB) proposed new rules. Announced in July 2016, the CFPB’s overhaul of debt collection practices is going to impact your business operations directly. One of the most impactful pieces of the proposed rule is the restriction on the number of contact attempts. While the regulation appears straightforward, the execution is far from it.

To ensure the number of contact attempts does not exceed the proposed limits in any way — from site-to-site, from business line-to-business line, from agency-to-agency, across phone, SMS, email, and even print mail systems — centralized controls must be in place. This is, of course, a multi-million, multi-year venture.

So like many ARM leaders, you may find yourself essentially stuck between a rock and a hard place – either spend millions to centralize controls for every channel that touches your consumer or risk millions if that consumer is contacted too many times.

There is another option – an escape ladder from your rock and a hard place. However, before that, let’s first take a look at the proposed new CFPB rules.

The Rock: CFPB Restrictions on Collector Communication

Here is a summary of the proposed rule for collectors’ communication attempts.

  • A collector is limited to six communication attempts per week when they are trying to contact a consumer who has not been previously reached
  • The six contact attempts per week limit would include all communication across various channels including phone, email, or postal mail
  • Total attempts allowed per unique address or phone number for a consumer are only three per week
  • A consumer can prohibit a collector from contacting him on a channel or at a particular time that is inconvenient to him
  • Once the consumer has been contacted initially, a collector would be limited to only one live communication per week and three total contact attempts per week

Source: http://files.consumerfinance.gov/f/documents/20160727_cfpb_Outline_of_proposals.pdf

The Hard Place: High Cost in Building Your Own Centralized Communication Controls

The inability to meet the CFPB’s contact attempt requirements not only puts you at a direct risk of litigation, but can also devalue your appeal to creditors who fear the implications of vicarious liability. Below are the two options that some of the businesses have considered:

Manual Operation: Implementing and maintaining the contact attempt cap manually is next to impossible.

  • Difficult to enforce communication cap across your operation — from agent-to-agent, site-to-site and across phone, SMS, email, and even print mail systems
  • Each time an account is transferred, your risk increases
  • There is no way to track all communication attempts in real time

Automated Operation: Automating and integrating controls across different communication channels can be a daunting task. It burdens you with capital and time investments. Here are a few challenges that we foresee in automating the contact attempt cap.

  • Employing specialized staff that understand and can develop an automatic contact attempt cap system across diffferent commmunication channels
  • Large databases and data storage (Data Warehouse) requirements
  • Centralized call monitoring would have to be developed with individual API’s for multiple communication platforms
  • Extra cost for data storage
  • Working under tight timeline in order to develop the system before the rules come into effect

The Escape: A Turn-key Solution to Provide Automatic Dialing Controls

A cloud solution is the best option to solve this challenge. Using a cloud-based, plug-and-play approach, contact centers can easily achieve the control for contact limitations, without additional CapEx, time, or resources. LiveVox’s Phone Dial Attempt Supervisor (PDAS) is a market-leading cloud solution specifically designed to help you achieve contact attempt CFPB compliance in a cost-effective manner. With PDAS, contact centers can quickly adapt and ensure that all operations adhere to pre-set contact limits.

Here are the feature highlights for PDAS:

  • A turn-key solution that can be configured to address company’s specific requirements
  • Flexibility to configure compliance contact levels or “max attempts” based on several, client-selected variables: to an account, to a combination of account and phone number, or to any particular phone number across an entire list
  • PDAS provides easily configurable contact limitations that are automatically enforced across the entire network. Unlike post-event and manual intensive audits, PDAS provides preventative controls
  • PDAS is rapidly extending its controls to various contact channels including email, SMS and print mail

PDAS is a prime example of how LiveVox’s rapid cloud delivery model helps clients cost-effectively stay at the forefront of industry change.

Don’t wait until it’s too late, request a demo of PDAS today.

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