Quick analysis: Another “Up” Month
In May, TCPA (+20.7%), FDCPA (+25.4%) and FCRA (+4.2%) suits were all up over April, and TCPA (+9.3%), FDCPA (+19.2%) and FCRA (+23.3%) suits were all up YTD as well. Meanwhile, CFPB complaints were a bit down for the month (-5.8%) but still way up for the year (85%!).
The Fourth Circuit, both at the appellate and district court levels, packed several punches in June. At the district court level, a Maryland federal court authored a decision concluding that under the facts at issue, a defendant had not obtained prior express written consent by phone to make certain telemarketing calls. Later in the month, the US Court of Appeals for the Fourth Circuit issued an opinion providing further guidance as to what qualifies as a fax advertisement under the TCPA.
Artificial intelligence (AI) may cut costs, but financial services companies have reportedly been slow to embrace it. That’s according to a report Sunday (June 30) by the Financial Times (FT), which said that regulatory concerns and worries about job losses have kept banks from adopting AI products. “The big banks will definitely not adopt [the technology] as quickly as any of the FinTech,” said Tom Blomfield, co-founder of neobank Monzo and group partner at Silicon Valley startup incubator Y Combinator.
According to a study by SecurityOrg, 60% of the credit card holders in the USA have experienced fraud. Four out of five American adults have a credit card while three out of them have experienced major or minor frauds. These are approximately 52 million Americans with a median fraud of $100 in 2024 while it was $79 in 2022. One in five frauds also recorded being scammed of $500 in 2024.
The due diligence required to hire a collection agency can be exhaustive. Site visits, reference checks, policy and procedure reviews, cyber reviews, testing and more – and that’s not even counting the contracting phase. The last thing anyone wants to think about is termination preparations! But, the time to think about termination is at due diligence and contracting. Most creditors include a termination clause in their contracts with agencies. Most make a lot of sense at the time of contracting. However, at the point in time when termination seems imminent, the contract clause doesn’t often seem to cover the necessary fine details.
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