Restrictions on Recorded Messages to Debtors

NCO Group, Inc. recently consented to judgment in a lawsuit brought by the Federal Trade Commission (“FTC”) pertaining to recorded messages to debtors.  Even though the Consent Decree does not constitute a legal requirement or regulation governing the activities of debt collectors not party to the action, Fair Debt Collection Practices Act (“FDCPA”)  claims may be brought in the future against collectors based on the Consent Decree’s requirements.  Therefore, under the most conservative approach to FDCPA compliance, a collector should attempt to comply with the requirements of the Consent Decree.  Below is a brief summary of the requirements contained in the consent decree: Collectors generally cannot disclose in a recorded message (e.g. voicemail, answering machine, message service):

  1. the first or last name of the debtor, and
  2. that they are a debt collector, are attempting to collect a debt, or that the debtor owes a debt.

Collectors may only leave such a message if:

  1. the recorded greeting on the messaging system discloses the person’s first and last name, and only that person’s first and last name, and that first and last name is the same as the person who allegedly owes the debt; or
  2. Defendants have already spoken with the person on at least one prior occasion using the telephone number associated with the messaging system, provided that the person has not explicitly prohibited the Collector from leaving recorded messages at that phone number.

Even though courts interpreting FDCPA requirements are not required to give deference to the FTC, they sometimes will.  For that reason it is advisable for credit collectors to follow the restrictions established by the FTC in the consent decree.