Text Messages. A debt collection industry advocate reported on a non-scientific poll where industry visitors were asked how text messages play a role in debt collection. According to LiquidEdge’s June 2012 Industry Poll (of Newport Coast, California), participants were asked to report their use of text messages as a “part of their overall collection strategy.”
Eighty percent of respondents stated that strategies to collect debts through text messages are currently or will be a part of their collection operations. Conversely, 20% replied that debtors did not give permission to the debt collector to use text messages as a form of collection communication. Additionally, an overlapping 40% of the respondents stated that they have seen positive results in testing text messages for collections.
The poll’s administrators concluded that “80 percent of the industry is currently using text messaging as part of their overall collection strategy.” Without disclosing the number of participants in their unscientific poll, they also deduced that the collection “industry is open to leveraging mobile and text messaging solutions to be more efficient and productive.”
Debt collectors are desperate for new channels to collect debt. Old standbys like landline telephone directories are no longer as useful in tracking and locating consumers as they turn to exclusive cell phone usage. Cell phones, VoIP, Skype, and Google Talk are notably without directories making it difficult to find persons who no longer use landlines.
In interpreting the poll results, InsideARM said, “New technologies will continue to play and important role in collections and will enable collectors to use multiple channels to collect debt.” Recently, though, the collection industry was shaken by enterprising collectors who were using or trying to use facebook and other social media to impermissibly contact debtors.
Unauthorized Debt Collection Text Messages May Conflict with Consumer Laws
Debt collection use of cell phones to autodial or text consumers is fraught with risk the poll’s administrators obliquely acknowledged when referring to the need for permission. The Telephone Consumer Protection Act (TCPA) requires express permission to communicate with cell phone users by autodial or text. The Fair Debt Collection Practices Act (FDCPA), on the other hand, forbids any debt collection communications where receipt of the communication will cost the consumer charges.
Although now very common, some cell phone users do not have unlimited text messages for a flat charge. Instead, they are still charged on a per text basis implicating at least the FDCPA’s prohibitions. Currently, there is no technology or data that will advise a debt collector whether the debtor’s cell phone plan charges for text messages or not.
Debt Collection Text Messages To Play Out In Courts
Whatever the risk, the debt collection industry appears poised to rush into the murky depths of new technologies juxtaposed against consumer protection laws that may not have kept up with changing times. InsideARM reported that LiquidEdge developed a hardware and software program that will permit a debt collector to autodial cell phones with text messages. The program, CollectMobile, is an “exciting new product” that will enable lenders, collection agencies, and debt buyers to communicate with debtors by text messages.
“Response and contact rates [to text messages] greatly exceed dial, email, and lettering,” was InsideARM’s enticing conclusion.
Consumer Rights Attorneys remain opposed to using text messages to contact debtors particularly if there is no advance permission. As debt collectors sail the channels of new communication technology, it will be up to the courts to determine where are the shipwrecking shoals.
PA & NJ consumers receiving text messages from debt collectors are encouraged to call us at 610-616-5303 or 856-861-4241 or complete our form to learn more about rights to restrict debt collection contacts.
CORRECTIONS & AMPLIFICATIONS
This article has been revised. On July 12, 2012, we reported that InsideARM was a trade association. According to a senior source, InsideARM is not a trade association. It is a debt collection advocate and we have corrected our reporting. Additionally, we reported that the poll was administered by InsideARM. The source claimed that the poll was administered by LiquidEdge. We regret our errors.