Clear direction about whether a repossession agency or lender can contact debtors through some of the latest technology methods such as cell phones or social media remains uncertain, according to the American Financial Services Association.

AFSA staff members recently attended a workshop hosted by the Federal Trade Commission on consumer protection related to debt collection and new technologies. With advancements in technology, AFSA pointed out that debt collectors are relying more on pre-recorded messages to contact consumers and are expanding communication to third parties, such as relatives, employers and neighbors about the primary borrower, which can cause problems for the consumer.

“Most of the new methods for debt collectors to communicate with consumers — e-mail, cell phones, and social media — are either not regulated or lack clarity in current regulations like the Telephone Consumer Protection Act and Fair Debt Collection Practices Act,” the association asserted.

“Several panelists said that the Consumer Financial Protection Bureau should take over governance of consumer protection regarding new technologies that debt collectors are using to approach consumers and gather loan data,” AFSA added.

Along with sharing the overall assessment of the workshop, the association ran down several points raised during each of the panel sessions. Here are some of the highlights:

Panel 1: Obtaining Information about Persons: Skip-Tracing and Beyond

AFSA recalled that workshop discussion pointed out that skip-tracing technology helps avoid the collection of incorrect data, but it has become easier to not contact consumers in-person and allows, in many cases, collectors to contact third parties other than the primary borrower, such as relatives, to find out information about the borrower.

“There should be a limit as to the resources that are available to contact the consumer. This could be done through personnel training. The Fair Debt Collection Practices Act addresses this issue, but it is important to scrub the data collected to be able to contact the right people,” association officials noted.

“With increased level of accuracy in place, the industry should stop using Social Security Numbers, balancing accuracy with mitigating the risk of ID theft,” they continued.

“FTC has privacy measures in place, but there needs to be clarification that skip-tracing firms must follow these safeguards. Also, there are no dispute mechanisms in place if the loan data is inaccurate,” they added.

Panel 2: Telephone Technologies: Dialing, Talking, and Texting, in an Age of Enhanced Mobility

AFSA mentioned the moderator for this session expressly clarified that the panel was not going to focus on the TCPA or FDCPA. The discussion intended to address consumer protection generally.

“Sometimes when a collection agency calls a consumer, the agency’s phone number is truncated and omits information such as the agent or debtor’s name. This poses a problem for a consumer that was erroneously contacted and is not the debtor because of in an automated message they cannot get a hold of the agency,” association officials recollected.

“One of the panelists stated that an average debt collector makes 183 calls a day to consumers to collect a $200 debt,” they interjected.

“It was suggested that the first call made to a consumer should be done by a real person to verify they have reached the right person and that the FTC should clarify how many calls a debt collector can make to a consumer,” they went on to say. “However, industry panelists argued that it is impossible to contact a debtor directly because loan volume and technology have changed.”

AFSA also pointed out results of a 2010 Pew Research Center’s 2010 study that determined cell phones have become the device most used to communicate during the past 10 years. The study indicated eight of 10 U.S. adults use cell phones.

Panel 3: Managing the Flow of Information: The Intersection of Collector

AFSA noted that much of this discussion stemmed from a case in Colorado.

“Many of the consumer complaints to the Colorado attorney general deal with verification of a debt,” officials noted. “The industry explained that attaching all debt-related information when communicating with a consumer is not economically feasible, but issuers are taking it more seriously.

“Also the exportation of data might not be advanced for that collection agency; and creditors do not have a lot of incentives to keep loan data after it is passed on to debt collectors. However, creditors are required to keep the data for two years,” they went on to say.

AFSA thinks frustrations consumers are facing in Colorado have to do with skip-tracing and dialer software.

“If a consumer who is not the debtor corrects this information, and it is removed from the dialer, in many cases, the skip-tracing software will continue to populate the same erroneous information which will be again used by the dialer to contact the same consumer,” association officials acknowledged.

“The AG’s office has seen this erroneous data being removed/re-introduced 10 times for one consumer. Skip-tracing should permanently block erroneous information and phone number from being repopulated,” they recommended.

Panel 4: Communication by E-mail

AFSA calculated that just 2 percent of debt collectors use e-mails or text messages to communicate with consumers, but the association said it is becoming more common for consumers to initiate e-mail communication with debt collection agencies.

“There is no clarity on current regulations as to e-mails,” association officials declared. “The FTCPA does not clarify the ‘medium’ through which the debt collector conveys information to a person regarding a debt.

“The industry needs mechanisms to solve the issue of consumers saying they did not receive an e-mail,” AFSA insisted. “Some of the panelists thought that e-mail was a convenient way for a consumer to get a communication from the debt collection agency because they decide when to open it; it is a better way to reach the consumer; it is not confrontational; there could be a record of confirmation of consent; more accountability via e-mail than versus phone and lower cost for consumers and the industry.”

Panel 5: Using Social Media for Debt Collection

AFSA believes people should not have an expectation of privacy when they publish information on public sites.

The association explained digital footprints, classified as first degree, is voluntary information people post about themselves. And secondary, is information about a person that someone else posts — such as tagging in a picture on Facebook.

“Likelihood of a debt collection agency incorrectly identifying a consumer through Facebook is quite high because there are a lot of people with the same name, unless the debtor has a really unique name,” AFSA contends.

“Most panelists agreed that it’s not wrong to get information from social media if it is used appropriately. However, it is troublesome that consumers do not know that their information is used for debt collection,” the association went on to mention.

“Any regulation that stifles communication between debt collector and consumer is bad for consumers,” AFSA stressed. “The FTC should provide guidelines. The main goal is the individual’s right of privacy, and to not be harassed, but it is important to balance the legitimate right of creditors to get paid while safeguarding the borrower’s right.”