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Consent: A Closer Look at the CFPB’s First Wave of Rulemaking

March 25, 2021
Revco Solutions Blog_Consent: A Closer Look at the CFPB's First Wave Rulemaking_March 25, 2021

Much of the significant regulation passed at the end of last year in the debt collection industry focuses on ensuring that we are communicating with consumers in the way they want in connection with the collection of a debt. E-communication – specifically email and text messaging – has become the norm, and cold calls and letters are a thing of the past. These days, an unsolicited phone call is equivalent to SPAM, and most unrecognized mail is discarded, yet that is how the industry continues to attempt to communicate with consumers to fulfill the legitimate business needs of our customers and help consumers through a difficult time.

While our industry has been hesitant to adopt these new communication preferences, the CFPB’s first wave of rulemaking gives us more direction and a safe harbor for pass-through consent using these “new methods.”  Let’s break down the new consent requirements set forth in the rulemaking. The key to consent is two-fold: how you obtain consent, and how you maintain it.

Obtaining Consent for E-Communications 

The procedure for obtaining consent to contact a consumer regarding a debt is different for email and text messaging. For email communications, it’s a bit simpler. A debt collector may communicate with the consumer about a debt via email if: 

  • The consumer used the email address to communicate with the present debt collector about the debt, and 
  • The consumer has not since opted out of communications to that email address. 

Similarly, the debt collector may also communicate via an email address if the consumer has consented to it by giving permission and has not revoked that consent. (12 CFR §1006.6(d)(4)(i))  As with the requirements for obtaining consent to auto-dial a consumer’s cell phone, the best practice is to get consent in writing, although documenting verbal consent into your system of record is also permissible.

For text messaging, the rules set forth for both implied and express consent permit a debt collector to text consumers for 60 days thereafter before needing to refresh that consent. 

Implied Consent A debt collector may send a text message to a consumer at a telephone number if that consumer used the same number to communicate with them via text and has not since opted out. However, implied consent based upon usage is only good for 60 days after the consumer’s last text message from that number. The debt collector must then refresh this implied consent by confirming that the telephone number is still the consumer’s and that they have not otherwise opted out. 

Express Consent A debt collector may send a text message to a consumer if the debt collector previously received direct consent to do so. Again, this consent is only valid for 60 days from the initial approval and must be refreshed in the same way mentioned above. The debt collector can confirm a telephone number is still the consumers by consulting a complete and accurate database.

Maintaining Consent for E-Communications 

In addition to the requirement of a 60-day refreshing mechanism for text messages, you must provide an option to opt-out with each e-communication you send, regardless of the medium. You must include clear terms for unsubscribing and a reasonable and simple opt out method, and cannot charge a fee. And of course, all requests must be honored within a reasonable amount of time. Failure to do so could be considered harassing behavior. 

How to Communicate with your Revenue Cycle Partners 

If you have already obtained consent and have been communicating with your consumers via email, what happens if you place that account in collections? Under the new rules, if consent is provided to you, the creditor, you can pass it on to your revenue cycle or debt collection partner if you provide written notice to the consumer or patient that:

  • Their debt may be transferred to the identified debt collector, and
  • The debt collector might use the email address to communicate with them unless they opt out within 35 days of the date of that notice. 

The notice can be provided in writing or electronically. We’ve provided sample language below for a Notice of Transfer and Email Notification as outlined in the official commentary to the rulemaking.

Guarantor Name: <<Jane Doe>>

Account Number: <<1234567>>

This email is to notify you we are transferring your account to <<Revco Solutions>> for collections, and we are providing <<Revco Solutions>> with the following email address for you:  <<Jane.Doe@comcast.net>>. 

<<Revco Solutions>> may use this email address to communicate with you about the debt.If others have access to this email address, then it is possible they may see the emails. 

If you would like to opt out of <<Revco Solutions>> contacting you about this account by email at << Jane.Doe@comcast.net >>, please click the link below and follow [the process*] by <<35 days from statement date>>.

Click here to opt out.  (*this could be an email address, opt out button, or link to webform)

Thank you,

Patient Accounting, ABC Hospital

As we navigate the modernization of our industry, Revco Solutions will continue to provide you with the information you need to keep your organization compliant. Subscribe for updates to stay up to date on the latest developments, or contact us with specific questions.

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