On Wednesday, the National Mortgage Servicing Association [1] (NMSA) sent a letter to the FCC [2] requesting clarifications and guidance regarding implementation of regulations imposed by the Telephone Consumer Protection Act [3] (TCPA).
Back in March, the U.S. Court of Appeals for the District of Columbia Circuit issued a ruling [4] in the case of ACA International v. FCC, clarifying several issues with regard to consumer and industry rights pertaining to robocalls [5] and texts sent to consumers. While industry groups hailed this as a step in the right direction, there are still many questions that need answering with regards to how TCPA regs apply to servicers and the financial services industry.
The NMSA is a nonpartisan organization driven by senior executive representation from the nation’s leading mortgage servicing organizations, formed for the purpose of effecting progress and change on the key challenges that face the mortgage servicing industry. The NMSA’s letter is in response to a call for comment solicited by the FCC after the court’s ruling in ACA.
“Current TCPA regulation, while admirable in motivation, is the product of an outdated regulatory response to concerns from a bygone era," said Ed Delgado, President and CEO of the Five Star Institute [6]. "One need look no further than the lessons gleaned from the recent natural disasters to see that mortgage servicers and consumers alike have a vested interest in ensuring that the most up-to-date information regarding the status of the largest investment that many Americans will ever make—their home—is readily available via channels that are convenient and accessible. The industry is requesting a common-sense regulatory response to the realities of 21st-century technological capabilities."
The NMSA letter notes that the TCPA’s original intent to protect consumers from unwanted telemarketing calls was admirable. “Recently, however, the TCPA has been expanded far beyond its intended purpose and is in need of reform,” the letter states. “The TCPA, as construed now, actually harms both consumers and businesses attempting to comply with the law. Consumers are harmed because businesses face barriers in communicating vital and often legally required information using forms of communication (text, email, cell phones) that are impacted by TCPA restrictions.”
As such, the NMSA’s letter lays out several suggestions as to how the TCPA regulations should be modified. First, it suggests that the FCC clarify the definition of an “auto dialer.” The NMSA recommends that dialing from a list should not automatically constitute an auto dialer. Furthermore, the NMSA suggests that “to be considered an [auto dialer], the technology needs to generate a phone number in random or sequential order AND call the number generated.”
The NMSA recommends that the type of device used to contact the consumer should be less of a concern than the means in which that technology is used.
“The consumer doesn’t know or care how they are called; they only care whether telemarketing calls are unwanted,” the letter reads. “Discussion should shift from the technology being used to the purpose of the call and whether a caller has a legitimate business relationship with the consumer. As businesses attempt to reach out regarding an account, the consumer should be able to receive their messages via their preferred manner of communication.”
The NMSA letter also requests further clarification regarding how businesses should deal with reassigned phone numbers, pointing out that the caller has no way of knowing who will pick up the phone if they haven’t been informed that the number has been reassigned.
Another key area in need of clarification is the ways in which consumers may grant or revoke consent to be contacted.
As the NMSA letter explains, “The TCPA states that a consumer needs to provide ‘express written consent’ to receive calls from a company, and, at the same time, gives the consumer the option to opt out of the consent by ‘any reasonable means.’ While the court upheld this aspect of the regulation, ‘any reasonable means’ is problematic and overly broad.”
The NMSA letter thus recommends that the FCC provide a more concrete definition of “any reasonable means” as: “(1) a company establishing and following procedures for revoking consent; or (2) not using intentionally deceptive options of opt-out.”
The topic of robocalls/auto dialers was also the subject of a recent Senate hearing. Scott Delacourt, Partner, Wiley Rein LLP and a representative of the U.S. Chamber of Commerce who testified at the Senate hearing, said: “Unfortunately, the Commission’s implementation of the Telephone Consumer Protection Act over many years has fostered a whirlwind of litigation. Interpretations by courts and the FCC have strayed far from the statute’s text, Congressional intent, and common sense, turning the TCPA into a breeding ground for frivolous lawsuits brought by serial plaintiffs and their lawyers, who have made lucrative businesses out of targeting U.S. companies.”