Recent Initiatives and Priorities The Federal Trade Commission’s Debt Collection Program Colin Hector Attorney Division of Financial Practices Federal Trade Commission North American Collection Agency Regulatory Association 2015 Annual Conference September 29, 2015

Federal Trade Commission 1.FTC’s enforcement authority 2.FTC debt collection strategic priorities and recent cases 3.FTC’s business education, outreach, and policy initiatives 4.Question and answer period Presentation Overview

Federal Trade Commission I ≠ Disclaimer

Federal Trade Commission 1 FTC’s Enforcement Authority

Federal Trade Commission Nearly 30 million or 15% of Americans have debt subject to third-party debt collection 88,300 complaints received in 2014 – CFPB now engages in mediation attempts A Nation of Debtors

Federal Trade Commission Enforcement – Section 5 of the FTC Act (unfair/deceptive practices) – Fair Debt Collection Practices Act (FDCPA) Rulemaking – No FDCPA rulemaking Consulting Role w/ CFPB FTC Authority

Federal Trade Commission 13(b) actions, often seeking relief on an ex parte basis – Receivership over corporate entities – Freeze defendants’ assets – Immediate access to defendants’ business premises Civil penalty actions, referred to DOJ for filing – Generally reach out to company pre-filing – Often file complaint & settlement at same time Approach in Litigation

Federal Trade Commission 2 FTC’s Strategic Priorities for Debt Collection and Recent Enforcement Actions

Federal Trade Commission In 2014: – Filed 10 new cases against 56 different defendants – Obtained nearly $140 million in judgments – Banned 47 companies and individuals from the debt collection industry Debt Collection is a Major Priority for the FTC

Federal Trade Commission In 2015: – Have already filed 8 new cases against 37 different defendants – Settled 5 cases and obtained $78,320,142 million in judgments – Banned 18 companies and individuals from the debt collection industry – More is on the way Debt Collection is a Major Priority for the FTC

Federal Trade Commission Data integrity and security Egregious collection practices Emerging technologies (e.g., social media, text messaging, ) Protecting vulnerable and underserved populations Previous Priorities

Federal Trade Commission New Priorities Data integrity and security Egregious collection practices Student loan debt collection CFPB rulemaking

Federal Trade Commission FTC and CFPB v. Green Tree Servicing LLC

Federal Trade Commission FTC v. Federal Check Processing, et al.

Federal Trade Commission FTC and People of New York v. National Check Registry, et al.

Federal Trade Commission FTC and People of New York v. Vantage Point Services

Federal Trade Commission FTC and People of New York v. 4 Star Resolution, et al.

Federal Trade Commission Messaging for Money Sweep

Deceptive Door Opener Texts YOUR PAYMENT DECLINED WITH CARD ****-****- **** CALL IMMEDIATELY

Deceptive Door Opener Texts YOUR PAYMENT FOR $[AMOUNT] IS SCHEDULED FOR [DATE]. CALL WITH ANY QUESTIONS OR CONCERNS

Deceptive Door Opener Texts YOUR PAYMENT OF $[AMOUNT] IS SCHEDULED FOR [DATE]. CALL IF YOU WANT TO MAKE YOUR PAYMENT EARLY

Federal Trade Commission False Litigation Threat Texts I'm a process server w/ Primary Solutions, appointed to serve you papers for case [eight digit number]. Would you like delivery at [consumer's home address]? Please have proper ID and witness present who can provide a signature. If there's no reply I'll have to bring the document to your employer. It’s already been verified this is a contact number for [consumer's name]. So I just need an appropriate time and place to serve the papers when ready. Check your call records, a recorded call from [number], verified this as the correct number. Indicating otherwise will be proof of deceptive practices. CB#: [phone number].

Federal Trade Commission 3 FTC’s Debt Collection Business Education and Outreach Initiatives

Federal Trade Commission Debt Collection and the Latino Community

Federal Trade Commission Do’s and Don’ts of Debt Collection Text Messaging: Business Blog

Federal Trade Commission Data Security Guidance

FTC’s Business Center: business.ftc.gov

CASES VIDEO REPORTS BLOGS GUIDES

FTC’s Business Blog: 39 Debt Collection Posts to Date

Federal Trade Commission FTC’s Debt Collection Dialogue Events

BUFFALO June 15 DALLAS Sept. 29 ATLANTA Nov. 18

Federal Trade Commission The Debt Collection Hall of Shame To date: 87 bans

Federal Trade Commission Question and Answer 4

Federal Trade Commission Colin Hector Attorney Division of Financial Practices Federal Trade Commission Questions?