Aaron Reiter By Aaron Reiter • January 30, 2018

An Industry Governed by Fear

2 Minutes

I know, that title is a little bit sensational, but I made my point. So much of what collection agencies do is governed by rules, regulations, and legal precedents. For example, you are given pretty clear guidelines regarding when an individual can be called, what you can say in a collection letter, and what you need before you are able to call someone on a cell phone.

But there is just as much, if not more, that is not done because there are either conflicting or no rules, regulations, or legal precedents. So annoying.
Here's a prime example that might suprise you: there is no law that prohibits a collection agency from sending a text message or an email to an individual. To clarify, there are laws that govern aspects of how a collection agency can communicate with an individual, but there is nothing that specifically says sending a text message or sending an email is forbidden. "What?", you ask with your head cocked to the side, "I thought that was a no-no." 
New Call-to-actionIt is a gray area where the practice hasn’t been ruled to be legal or illegal that gives collection agency executives such pause. As a rule in our industry, not knowing whether something is permitted is pretty much the same as saying it’s not allowed. Also annoying.
You'll see to the left of this text a thumbnail of a memo titled "TCPA COMPLIANCE ALERT". This is a white paper released by Solutions by Text this week, and penned by the law office of Rick Perr, current ACA President. The guidance provided by Perr's law firm gives collection agencies and departments more clarity on the allowances in this growing communication strategy. Click on the image for a free copy!
Even before this white paper, there are collection agencies out there that have been sending text messages. And emails. And dropping voicemails directly into an individual’s phone without making a call. Collection agencies that are waiting for clear-cut, green light language from the Consumer Financial Protection Bureau or amendments to the Fair Debt Collection Practices Act or even a Supreme Court ruling on a specific topic should not hold their breath. I can feel your intense gaze through the screen, my friend. Are you ready to ask what you should do instead of turning blue?
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Agency owners or department heads who are willing to send text messages or emails, or do other things that operate in that not-specifically-forbidden zone, run the risk of gaining the attention of over-zealous consumer attorneys, that is true. But if an agency wants to keep up with modern times and consumer habits, what does it have to lose? Another consideration is that if you're not contributing to this new precedent, your competitor may be and that's a competitive advantage you may not want to concede.
The reality is consumers are abandoning their landlines in droves. Study after study has shown that adoption of new communication methods are turning phone calls and letters into the telegrams of today. Yet, too many collection agencies are rooted in decades-old communication strategies because that's how they have always done it and the rules are fuzzy.
Collection agencies should not be afraid to innovate, there are just too many tools available to the industry these days. Think of the money that is being left on the table because of that fear.