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A Comprehensive Guide To Regulation F And How It Impacts Debt Collection

Overview of Regulation F Compliance

Overview of Regulation F Compliance

Big changes are coming to the debt collection industry: Regulation F will affect how you do business and could spell legal trouble

TCN has developed this comprehensive guide to Regulation F and how it affects debt collection agencies and their practices. The Consumer Financial Protection Bureau (CFPB) announced the final rules interpreting the Fair Debt Collections Practices Act (FDCPA) on July 30, which are effective November 30, 2021. 

As a result of this new ruling, your agency will have to make changes to communication practices and it’s important to understand how to stay compliant to avoid big fines or even legal trouble. Regulation F institutes a lot of changes for you and your agency, but don’t worry, TCN has you covered with this informative guide that breaks down everything you need to know and how it affects your business.

 

What exactly is Regulation F and why is it important?

In plain English, Regulation F is a new law that all debt collectors have to adhere to. The overall aim of Regulation F is to outline prohibitions on harassment or abuse, false or misleading representations and unfair practices. It’s a rule of the Fair Debt Collections Practices Act (FDCPA), which is enforced by The Bureau of Consumer Financial Protection (CFPB) and significantly impacts the overall debt collection process. The original Act needed some clarification and now that it’s here, it will directly create a need for debt collection agencies to make significant changes on how and when they can communicate with debtors. 

There are a lot of new aspects to Regulation F that establish new parameters for debt collectors, like providing a model validation notice and refining some stances on out-of-stat debt. 

Reg F also clarifies several rules about communications – including telephone calls, e-mails, and text messages – made by certain debt collectors when attempting to collect a debt on an allegedly owed debt. The rule was issued on November 30, 2020, and will supersede and replace previous rulings put forth by the FDCPA after its effective date of November 30, 2021. TCN has unpacked everything you and your agency need to know to help you make these changes.

Regulation F’s notable details:

  • Regulation F is an amendment to 12 CFR part 1006, which implements the FDCPA
  • The CFPB’S Reg F applies to “debt collectors,” using essentially the same definition that the FDCPA used.
  • Regulation F effectively brings changes to debt collections law
  • Regulation F outlines and clarifies precise parameters on what time and where consumers may be contacted.
  • Regulation F prevents excess contacting
  • Regulation F outlines a new Model Validation notice
  • Regulation F clarifies the new 7-in-7 rule
  • Regulation F offers five (5) mandated “Itemization Dates” to choose from

Why does Reg F matter to me and my business?

The CFPB’s Regulation F is a debt collection law that applies to debt collectors using the same definition that the Fair Debt Collection Practices Act used. These organizations are defined as collection agencies, debt buyers, collection law firms, and loan servicers. If these business models apply to you, you will need to be fully compliant with Reg F’s new rules by November 30, 2021. 

So, understanding the new rules is important to your business, because if you’re in noncompliance, your agency can be hit with substantial fines. To avoid these substantial penalties, agencies should seek out and take advantage of compliance software that allows the ability to set intuitive rules, includes list management services, supplies natural language compliance and analytics to minimize your exposure to the risk of non-compliance to debt law. Agencies should also take steps to begin training implementation for their agents and call centers now so they are prepared for how they can communicate with debtors.

Who does Regulation F apply to?

Regulation F encompasses a broad range of debt collection businesses and impacts all of them equally in how they can contact debtors. Regulation F is not exclusive to third-party debt collectors or debt buyers — first-party collections are included in Regulation F’s ruling. However, creditors collecting on debts they originally owned do not qualify as debt collectors. If a creditor is not a “debt collector” as defined by the FDCPA, Reg F can still affect creditors’ collection processes and they should complete due diligence to ensure compliance with their oversight responsibilities subject to the FDCPA.

Regulation F officially applies to:

  • Collection Agencies
  • Debt Buyers
  • Collection Law Firms
  • Loan Servicers

Overview of the main Regulation F requirements

The main requirements of Reg F include a series of clarifications of the previous rules of the FDCPA and hone in on the number of times and times of day that debtors can be contacted. Reg F also requires agencies to provide a model validation notice and retain their records for three years.

Here’s a snapshot of the main requirements and contact restrictions of Regulation F:

The 7-in-7 rule: Reg F stipulates that there may be no more than seven (7) calls made by a debt collector to a consumer in a span of seven (7) days. 7-in-7 rule explained in more detail here.

Time of Day: Debt collectors may not attempt to contact a consumer before 8 a.m. or after 9 p.m. in the consumer’s local time zone. Some states have their own time restrictions that supersede Reg F — it’s best to follow the strictest proscription.

Place of Employment: Debt collectors may not attempt to contact a consumer at the consumer’s place of employment.

Reasonable procedure rules: Sending emails to debtors is allowed, only after consent but this does not include private domains or employer email addresses. Text messages can also be sent to debtors after they have given consent. However, consent must be renewed every 60 days. Debt collection agencies also have to provide clear “Opt-Out” statements when communicating via text or email.

Limited Content Message: Voicemails may be delivered and do not fall under the “communication” rules under the FDCPA. However, to qualify, they must include a series of Required and Optional components.

Itemization dates: There are five dates to choose from to prevent consumer confusion. They are: The last statement date, the charge-off date, the last payment date, the transaction date or the judgment date. 

Model Validation Notice: Obligates the debt collector to share clear and conspicuous validation information with the alleged debtor, to select an “itemization date,” information about debt collection disclosures, information about the debt, information about consumer protections and information on consumer response options.

Retaining Records: Agencies must keep records beginning the day collection activity begins and for three years after the collector’s last activity on the debt. Recording software will be a crucial tool to avoiding high fees from FDCPA violations.

Current Regulation F challenges

Regulation F creates a new series of challenges that puts the onus on the agency to follow new communication standards and practices when attempting to pursue debtors for collection. Reg F applies to agencies pursuing recompense for medical debt, credit card debt, mortgage debt, student loan debt and beyond, regardless if it’s a secured or unsecured debt. Additionally, the myriad of rules requires agents to retain more records. The new model validation notice is, perhaps, one of the larger challenges for debt collection agencies as it obligates the debt collector to share an enormous amount of validation information to the consumer.

Much of Reg F’s challenging parameters can be mitigated, however, with scalable and customizable automation software that will save your organization the headaches and potential violation fines for noncompliance.

Understanding the CFPB, FDCPA and Regulation F (a deeper dive)

The history behind the law

To provide some necessary context for the new Regulation F, we first need to review the act behind the Fair Debt Collection Practices Act (FDCPA). Enacted by Congress in 1977, the FDCPA sought to shut down abusive practices by debt collectors in the face of increasing complaints made by consumers. It took steps to do so by establishing broad consumer protections and putting extensive debt collection communication regulations into place. The FDCPA applies to the collection of a variety of consumer debts but does not extend to business debts.

FDCPA and CFPB: The Act behind Regulation F and its enforcement bureau

For more than 30 years, the FDCPA was solely enforced by the FTC until the Dodd-Frank Act established the Consumer Financial Protection Bureau (CFPB) in 2010. Now, the FDCPA is upheld by both the FTC and CFPB through the issuing and implementation of substantive rules.

The CFPB is adopting this final rule, Regulation F, to clarify the debt collection communication regulations and how they apply with new technology. In November 2020, Regulation F was published by the CFPB to further clarify and implement the FDCPA later this year on November 30, 2021.

How did we get here?

Federal and state governments have both historically been on the side of the consumer to protect them from abusive, misleading, and unfair debt collection practices. Up until 1978, these regulations were enforced through the FTC Act, but Congress ultimately found these protections inadequate for consumers. 

Significant evidence compiled led Congress to believe that there was a direct cause-and-effect between consumer bankruptcies, marital problems, job loss, and a lack of necessary privacy. As such, the FDCPA was established, in part, as a measure to eliminate all harmful practices by debt collectors to further protect consumers.

Explanation of all primary components of the law

Let’s go over the key components of the FDCPA regarding debt collection communications:

  • A debt collector may not communicate with a consumer about the collection of any debt without direct, prior consent from the person or permission of a court with proper jurisdiction. 
  • Debt collectors may not communicate with consumers at unusual or inconvenient times — the convenient time for communication standing at after 8 a.m. and before 9 p.m. in the individual’s local time. 
  • Debt collectors may not communicate with the consumer if they know the person has an attorney with respect to the debt, and the debt collector is reasonably able to contact their attorney.
  • A debt collector may not communicate with a consumer at their place of employment if he or she has reason to believe the consumer’s employer prohibits such communication from taking place there.
  • Unless given direct, prior consent from the consumer, a debt collector may not communicate about the debt with any other person than the consumer, their attorney, a consumer reporting agency if permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.
  • Debt collectors must stop communicating with consumers if the consumer notifies them in writing that they refuse to pay the debt or wish to cease further communication with the debt collector, with some exceptions.

The 7-in-7 rule explained

An important aspect of this new rule regulates the frequency in which collectors can place calls to and make contact with consumers at any phone number. Collectors are permitted to place a call to the consumer about a particular debt seven (7) times within a period of seven (7) consecutive days, so long as no contact is made with the consumer in any of the attempts.   

The seven days are rolling and do not reset with the start of the calendar week.  If, for example, the first call is placed on Tuesday, one call is made on Wednesday, Thursday, and Friday each, two calls on Saturday, and one on Sunday — totaling seven calls within the past in six days — a call on Monday would be considered the eighth call within seven consecutive days, and would therefore be in violation of the rules.

This rule applies separately to each debt a consumer may have incurred, so seven calls to a consumer about one particular debt within seven days would not count towards the seven-call limit regarding a discrete debt.  If contact is made, which by definition includes a phone-call conversation with the consumer, the collector must not attempt to call the consumer again during the next seven days, day one being understood to begin on the day of contact. So, if you make contact on Tuesday, you cannot call again until next Tuesday — day eight — unless express consent is provided by the consumer to call them within seven days. It’s enough to make your head spin trying to keep track of these calls, but thankfully, software already exists that will help you keep track of it all to stay in compliance and not rack up unnecessary fees.

What are the types of communication Regulation F applies to?

Regulation F applies to communication by phone call including voicemail and extends to newer communication technologies such as SMS text messages, and emails, a necessary update since the previous regulation in 1977. 

Concerning phone calls, Regulation F redefines rules for consent (the consumer must give consent and a collector may not continue if the consumer should request in writing that communication stop), content (no misleading or harassing content, no profanity), frequency of calls (see the 7-in-7 rule above), appropriate hours (8 a.m. – 9 p.m.), to whom calls may be placed regarding the debt (only the consumer or consumer’s attorney, or the original creditor or creditor’s attorney) and to which locations a call can be placed (not the consumer’s place of work, for example). 

Voicemails are considered to be a “communication” or “making contact” unless they omit certain information and include other information, as specified in “limited-content message.” If the voicemail complies with the stipulations in “limited-content message”, it is possible that it not be considered as a “communication” with the consumer.  

Regulation F also provides for debt-related communications through email and SMS, as long as the consumer has given consent (and — in the case of SMS — renews consent for each given period of 60 days) and as long as a clear opt-out method is indicated to the consumer. The act also empowers the consumer to make decisions in terms of time, place, type of media and duration.

Who does Regulation F impact?

“Debt collector” is a broad term, so Regulation F clears up who qualifies as a debt collector or debt collection agency; it also defines who is excluded from the term. The CFPB’s definition in the regulation incorporates much of the same defining terminology originally used by FDCPA.

It’s critical for you to be clear on these definitions so that you can understand how and if Regulation F applies to you or your business.

According to the regulation, a debt collector is anyone whose main business is to facilitate the process of debt collection on behalf of someone else; this could be an individual or an organization. Also, anyone who enlists the help of a third-party debt collector or uses a different name from their own for the purpose of collecting their own debts is included in this group.

This includes:

  • Collection agencies
  • Debt buyers
  • Collection law firms
  • Loan servicers
  • Anyone who works for one of these types of businesses in the capacity of a debt collector

Who is exempt from this definition? 

  • A creditor, that is the person or entity to whom the debt is actually owed (except in the case mentioned above).
  • A person who does not work as a debt collector, but who aids in or carries out instructions to facilitate debt collection on behalf of the creditor. This could be a colleague or employee of the creditor. 
  • Government employees 
  • People who carry out judicial enforcement 
  • Nonprofits that help consumers get out of debt by collecting payments from them in order to reimburse their creditors.
  • Anyone who is related to the creditor in a legal, financial, or professional capacity and is also impacted by the debt. 

When and how can debt collectors contact consumers? Initial communications and subsequent communications

According to Regulation F, when a debt collector in your agency initiates contact with the consumer, they must inform the consumer that the purpose of the call is for the purpose of debt collection and that any information shared by the consumer will be used to that end.

Any initial written communication must also include this information, even if it was given in the first communication by telephone.

In every following (or subsequent) communication, the debt collector should specify he or she is a debt collector in the same language that the rest of the communication will be given in.

Debt collectors may not contact consumers or send messages at times or places that are generally considered inconvenient or specifically indicated as inconvenient by the consumer. The debt collector should use common sense to make this judgment and clarify with the consumer if necessary.

The regulation stipulates that the hours before 8 a.m. and after 9 p.m. (in the consumer’s time zone) are considered off-limits for making contact, and if the consumer’s state of residence has a more limited timeframe or if the consumer might currently be in a different time zone than his or her residence, this timetable should be respected in the strictest sense.  Using call center software can help with automated functions like Predictive Dialing, Preview Dialing and Manually Approved Calling so your agency can easily stay in compliance.

Choosing an itemization date.

Part of keeping in compliance with Regulation F is making sure your agency understands itemization dates and how they can be determined. The itemization date is the date by which the collector can reference the amount of the debt that he or she is trying to collect from the consumer.

Debt collectors can choose from five (5) possible dates:

  • The last statement (date of the last periodic statement or invoice provided by a creditor) 
  • The charge-off date (the date on which the creditor determines the debt to be neglected and unlikely to be paid)
  • The last payment date (the date of the most recent payment that has gone towards the debt) 
  • The transaction date (the date of the initial transaction that is indebted)
  • The judgment date (the date of a final court judgment that officially determines that amount owed)

This is just one of the many things that can be simplified with TCN’s call-center software. The  Natural Language Compliance tool allows users to create a series of simple filters that can serve to guide a collector into choosing the most suitable itemization date for a given situation, or also to assign a particular date to a particular consumer case.

Working backward: Naming creditors

In some situations, a creditor may not initially supply the debt collector with all of the necessary information. For example, if the creditor is actually more than one person (such as a group of surgeons at a hospital) and naming or identifying who the debt is owed to can pose a challenge. In a case where the creditor is a group of people, it might be ideal to name each individual creditor involved and also to use a name that identifies the group as a collective whole (such as the name of the hospital). The legal name of the group also may not be sufficient to make the consumer understand how the debt relates to him or her. In this case, Regulation F allows you to use a doing-business-as name. The aim here is to reduce consumer confusion. 

To make sure that you’ve included all of the necessary information for the consumer (as detailed in the Model Validation Notice), you can “work backward” by first reviewing what information must be included in your communications with the consumer and then asking your client (the creditor) to supply that information — always centered on what will be recognized and understood by the consumer, and what is required by Regulation F.  

In this way, helping and training your team (as well as clients and vendors) to understand and use (in the case of your team) model validation notices will maintain clarity and avoid miscommunication.

How to Avoid Regulation F Penalties and Stay Compliant

What are the penalties?

So what happens if a collector or agency breaks one or more of the rules in Regulation F? It’s important for you to understand both the procedures and the penalties for failing to comply with them so that you can mitigate risk and establish best practices in your business.

Penalties for failure to comply vary based on the degree and type of violation. If a savvy consumer, aware of her or his rights, feels threatened or bothered, they might decide to sue. Unwanted ramifications can include anything from fines, lawsuits and associated costs, or, in the worst case, having your license suspended or revoked.

What are common violations?

Common violations can stem from a misunderstanding of some of the clarifications that Regulation F makes.  

This can include:

  • Misunderstanding seven calls in seven days (which means seven calls total — no matter How many numbers are used — during a rolling seven-day period, not seven calendar days). 
  • Accidentally surpassing the seven call limit, due to oversight.
  • Calling before 8 a.m. or after 9 p.m., due to a time zone mix-up. 
  • Failing to include the required information in a limited content message. 
  • Accidental disclosures to parties who should not have access to confidential consumer information.
  • Forgetting to renew permission for SMS text communications every 60 days. 
  • Accidentally calling a ported number due to lack of database access or revision. 
  • Failing to adhere to the model validation notice. 
  • Failing to select the most suitable itemization date for a particular case.

These are all examples of mistakes that can be easily avoided with the right training and the right tools

Staying Compliant with Limited Content Messages

Under the CFPB’s rules, a “Limited Content Message” is a voicemail message that must include certain essential information and may include several additional details, but must not include any other information. The Limited Content Message is not subject to Regulation F or FDCPA restrictions on communications so long as the obligatory information is included.

Required Limited Content Information

As taken directly from Regulation F, this list shows what a voicemail must include in order to qualify as a Limited Content Message:

  • A business name for the debt collector that does not indicate the debt collector is in the debt collection business;
  • A request that the consumer reply to the message;
  • The name(s) of natural persons whom the consumer can contact to reply to the debt collector; and
  • The telephone number(s) that the consumer can use to reply to the debt collector.

Optional Limited Content Information

As taken directly from Regulation F, this list shows what additional information a voicemail may include while still being considered a Limited Content Message:

  • A salutation;
  • The date and time of the message;
  • Suggested dates and times for the consumer to reply to the message; and
  • A statement that if the consumer replies, the consumer may speak to any of the company’s representatives or associates.

A few other points to keep in mind:

  • A Limited Content Message must be a voicemail (not a letter, email, or text message).
  • A Limited Content Message may not be knowingly left for a third party — it must be left for the consumer.
  • Under Reg F, a Limited Content Message qualifies as an attempt to communicate but does not qualify as a communication.

Reg F specifies that “a voicemail message that includes a statement that the message is from a debt collector and a request to speak to a particular consumer” is not a Limited Content Message because it included additional information that is not found with the defining terms. 

The purpose behind adopting the definition of a Limited Content Message is to allow debt collectors to rely on fewer repeated telephone calls (avoiding an over-contact violation) while also minimizing the risk of third-party disclosure (one reason that the person leaving the message must not disclose that he or she is in the business of collecting debts).

Retaining Compliance Records

It’s imperative to keep in mind that you and your team must not only ensure compliance but, you must also retain records showing compliance (or non-compliance) with the FDCPA, beginning on the date that collection activity begins and continuing until three years after the debt collector’s last collection activity on the debt. Debt collectors can also choose to retain records for a longer period of time, three years being the minimum. 

Note that telephone calls made for the purposes of debt collection are also subject to record retention. The collector must keep a recording of each such telephone call for three years after the date of the call. The separate recordkeeping requirement for telephone recordings is based on the “unique burdens” associated with retaining telephone recordings.

The records should be copies of any documents or written communications delivered to the consumer and call logs that are created in the ordinary course of its business. There’s no need to create additional records or logs outside the normal course of one’s work — for example, showing all of the times the debt collector refrained from calling during an inconvenient time. 

According to the CFPB, records may be kept in any manner that accurately reproduces the communication with the consumer and is easily accessible; this includes computer programs where digital copies of records can be stored. This record-keeping is vital, especially in the face of any kind of audit or inspection your business might receive from the CFPB as a result of complaints.

Ceasing Communication

Debt collectors are not permitted to continue communication with a consumer — regarding that particular debt — after the consumer has sent notice, in writing (including through electronic forms of communication), that the consumer either refuses to pay the debt or desires to discontinue communication. 

It will be important for members of your team to clarify with the consumer which forms of communication the consumer prefers through attentive inquiry. An oral request to discontinue communication doesn’t necessarily mean that the consumer wishes to discontinue all modalities of communications, and this should be clarified.  

There are also some exceptions to the cease communication rule. A debt collector, after receiving a written communication from a consumer requesting to cease correspondence, may attempt to contact the consumer in order to: 

  1. advise the consumer that the collector will stop any further collection efforts;
  2. notify the consumer that the debt collector may invoke a specified remedy, and, where applicable;
  3. to notify the consumer that the debt collector or creditor intends to invoke a specified remedy.

An additional exception includes a mortgage servicer who is subject to the FDCPA with respect to a mortgage loan and is not liable under the FDCPA for complying with certain servicing rule provisions, including requirements to provide a consumer with certain disclosures. See Comment 6(c)(1)-2.

Informing the Consumer

Debt collectors cannot collect a particular debt until they have sent the name and address of the original creditor to the consumer.

This is a legally binding suspension of activity on the part of the debt collector that is triggered by receipt of a written request from the consumer for the original creditor’s name and address. That information cannot be withheld from the consumer, but keep in mind that the consumer’s written request for this information must be made within 30 days of the consumer’s receipt of written notice of debt from the debt collector.

Disclosure of Future Communications

Debt collectors are required to disclose that the communication is from a debt collector, and disclosures must be made in the same language used for the rest of the communication.

A debt collector who sends disclosures also needs to do so in a manner that provides actual notice within reason, and in a form that the consumer can keep and access later.

The relevant factors for determining “actual notice within reason” include the following:

  1. Identifying the purpose of the communication by including, in the subject line of an electronic communication, the name of the creditor to whom the debt currently is owed or allegedly is owed and one additional piece of information identifying the debt, other than the amount, such as a truncated account number; the name of the original creditor; the name of any store brand associated with the debt; the date of sale of a product or service giving rise to the debt; the physical address of service; and the billing or mailing address on the account;
  2. Monitoring notifications for deliverability or undeliverability from communications providers, un-deliverability meaning that a reasonable expectation of actual notice for that delivery attempt has not been obtained; and
  3. Identifying yourself as the sender of the communication by including a business name that the consumer would be likely to recognize, such as the name included in the notice described in § 1006.6(d)(4)(ii)(C), or the name that you have used in a prior limited-content message left for the consumer or in an email message sent to the consumer.

Following Regulation F Best Practices

What does compliance look like going forward?

In order to comply with Regulation F, it will be necessary that key members of your team carefully read and fully understand these new rules and how they apply to your organization. It can seem overwhelming at first, but the information is fairly straightforward. Once key stakeholders understand the scope of Regulation F, they can pass down relevant details to each respective department and member, collaborating to reform company policy, adjust workflows, and update compliance management systems.

With this top-down approach, you and your company can ensure that each team member has the necessary information to keep his or her daily responsibilities in compliance.     

Manuals and guides are useful; however, call centers really should be using software and systems to help curb human error. Plus, regular internal compliance audits and training sessions that use case studies and before-and-after-Regulation-F examples can go a long way in keeping everything on track.  

Team members should be encouraged to put the consumer’s needs at the center of their dialogue, ask probing questions, and provide convenient and agreeable correspondence options to the consumer whenever possible, in order to maintain a positive engagement.  While this article offers a comprehensive summary of the most important changes found in Regulation F, the full details of the legislature can be found here.

Training collection agents to understand model validation.

The CFPB has anticipated some of these compliance concerns for collectors and has therefore provided an outline or model for best practice.

The best way to train collection agents to understand the Model Validation Notice — effective Nov. 30, 2021 — is to introduce the new information in logical stages, using before and after examples, real or hypothetical case studies and simulated collection communication activities. 

The model states that debt collectors must provide a consumer with required validation information (as described in § 1006.42 by sending the consumer a validation notice in the initial communication.

The Model Validation Notice indicates the following information as required:

  • Debt communication disclosure as defined by § 1006.18(e)
  • Required information about the debt
  • Required information about consumer protections
  • Required consumer-response information

Specifics regarding these points can be found on the CFPB website. The regulation insists that safe harbor is not given to debt collectors who fail to provide a validation notice including the information described above. 

This might sound daunting, but that is where automation software can play a key role in your team’s success. To make sure your team’s use of the Model Validation Notice is complete and consistent, you and your team can rely on TCN’s call center software to avoid errors and stay compliant.

How email and text message communications need to be handled now.

Originally, policies were unclear as regards email and text message communication, but as these relatively newer technologies have evolved into more prominent forms of communication, the CFPB has defined policy around them as pertains to debt collection.

Email

Debt collectors can send an email to:

  • a public domain email address obtained from the consumer where either the consumer has already used an email from that address to communicate with the collector about the debt, or has given the collector permission to use it. 
  • an email address obtained from the creditor provided that the creditor sent the consumer a written or electronic notice indicating the transfer of the debt to a collector. The notice from the creditor must “clearly and conspicuously” state certain details
  • an email address obtained from the immediately previous debt collector, as long as he or she used that email address to communicate with the consumer and the consumer did not opt-out.

Text Messaging

Debt collectors are permitted to send a communication by text message when:

  • the consumer has consented by initiating communication through that channel; however, before sending any further text messages, the collector must confirm within each 60-day period that the consumer responded by text message from that phone number; or that the number has not been reassigned since the date of the consumer’s most recent text message.
  • the consumer has given explicit prior consent; even so, every 60 days, the collector must renew consent, or confirm that the number was not reassigned by consulting a database before sending an additional message.

Final Notes on Emails and Text Messaging 

When it comes to email and text message communications, opt-out forms are critical. All texts and emails must come with clear and conspicuous opt-out instructions. If the consumer opts out of an email or text message communication or revokes consent at any time, the debt collector must cease communication through that channel and clarify the best alternative with the consumer. A statement that is easily seen and easily understood describing a simple and free way to opt out of those communications must always be included. This is easily implemented using TCN’s call center software and the Natural Language Compliance tool.

Gain access to the tools your call center needs.

FAQ on Regulation F

What is Regulation F? 

Reg F is a new law that all debt collectors have to adhere to. The overall aim of Regulation F is to outline prohibitions on harassment or abuse, false or misleading representations, and unfair practices. It’s a rule of the Fair Debt Collections Practices Act (FDCPA), which is enforced by The Bureau of Consumer Financial Protection (CFPB) and significantly impacts the overall debt collection process.

When and how does the latest version of Regulation F go into effect?

On November 30, 2021, Reg F officially supersedes any previous rules found in the Fair Debt Collections Practices Act (FDCPA).

What types of communication does Regulation F apply to?

Regulation F includes policies for communications by phone call, voicemail, regular mail, email, text and SMS text.

Who does regulation F apply to?

  • Regulation F applies to collection agencies, debt collectors, debt buyers, collection law firms, and loan servicers.
  • Creditors collecting on debts they originally owned do not qualify as debt collectors unless they enlist the aid of a debt collector or use a name other than their own.

What are the most notable changes that Regulation F makes to the Fair Debt Collection Practices Act?

  • Regulation F is an amendment to 12 CFR part 1006, which implements the FDCPA.
  • Regulation F effectively brings changes to debt collections law.
  • Regulation F outlines and clarifies precise parameters on what time and where consumers may be contacted.
  • Regulation F prevents excess contacting.
  • Regulation F outlines a new Model Validation Notice.
  • Regulation F clarifies the new 7-in-7 rule.
  • Regulation F defines five (5) mandated Itemization Dates. 

Regulation F defines a limited contact message as an attempt at communication rather than a communication.

What are the current challenges faced by debt collectors in implementing Regulation F policies?

  • Understanding when and how debt collectors can contact consumers.
  • Understanding when and how to cease communication or certain modalities of communication.  
  • Informing the consumer properly of their rights and any required information.
  • Ensuring consistency and standards when it comes to disclosing information: not leaving out any required information, not including any prohibited information.
  • Training collection agents to understand model validation.
  • Understanding exemptions to the rules 
  • Consent management 
  • Consumer preferences 
  • Handling data from disparate data sources. 
  • Managing 7×7 call attempts and other channel communications (Email, SMS).

Which tools can help my team manage Regulation F compliance?

  • Natural Language Compliance tool (to make things like adhering to the 7-in-7 rule or respecting appropriate hours across time zones simple) 
  • Manual Approved Calling (combing human intelligence with software to approve and reject calls based on compliance criteria)
  • Manual Dial-Only Platform – Human Intervention (when agents know best; this feature is dialing mode is separate from any predictive campaign and cannot dial without human intervention) 
  • VocalDirect – Voicemail Delivery (non-intrusive direct voicemail delivery technology that can increase callbacks for various applications such as collections, reminder calls, and other essential messages that need to be heard)
  • Call Recording with PCI Redaction (accessible stored call recordings for training, compliance or audit reviews)
  • Cell Phone Scrub Built In (quickly identify and cancel calls to cell phones and ported numbers)
  • List Management Services (streamline and organize data sets in one place) 
  • Business Intelligence (take a holistic look at agent and customer interactions to make informed decisions) 
  • Voice Analytics (discover real-time insights with full-text transcriptions, keep full records of every call).

What is the FDCPA and how does it relate to debt collectors?

  • The Fair Debt Collection Practices Act (FDCPA). Enacted by Congress in 1977, the FDCPA sought to shut down abusive practices by debt collectors in the face of increasing complaints made by consumers. 
  • It took steps to do so by establishing broad consumer protections and putting extensive debt collection communication regulations into place. The FDCPA applies to the collection of a variety of consumer debts but does not extend to business debts.

What is the CFPB and how does it relate to debt collectors?

  • For over 30 years, the FDCPA was solely enforced by the FTC when the Dodd-Frank Act established the Consumer Financial Protection Bureau (CFPB) in 2010. Now, the FDCPA is upheld by both the FTC and CFPB through the issuing and implementation of substantive rules. 
  • The CFPB is adopting this final rule, Regulation F, to clarify the debt collection communication regulations and how they apply with new technology. In November 2020, Regulation F was published by the CFPB to eventually supersede and replace the FDCPA later this year on November 30, 2021.

Where can I learn more about the FDCPA?

Where can I learn more about the CFPB?

How can I stay up-to-date with CFPB’s latest rules changes?

Be sure to download your copy of our comprehensive ebook on CFPB’s latest rules.

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