To Record or Not to Record a Phone Call in Collections

Collections Training Resource
March 7, 2013 — 1,401 views  
Become a Bronze Member for monthly eNewsletter, articles, and white papers.

The practice of recording calls is important for collection agencies at many levels. The recording allows the resolution of debtor issues, provides promise-to-pay verifications, helps in quality assurance, and also assists in training of amateur collectors. The recorded files are then stored as voice documents for future reference. But, there are certain rules that all collection professionals should abide by while making and recording phone conversations with debtors. These laws ensure that all the dealings and transactions are done in a manner which does not cause any harm or harassment to the parties involved.

The Fair Debts Collection Practices Act

All professionals in the debt collection industry are bound by the FDCPA or the Fair Debts Collection Practices Act. They should follow the clauses of this act while making collection recording calls to debtors. This act is designed to eliminate deceptive, unfair, and abusive debt collection practices. Debt collection agencies should adhere to the strict guidelines mentioned in this act. The act also protects debt collectors from unfair competition. It also encourages consistent action by the state to protect the consumers from abuses that may occur during debt collection. The FDCPA originally applies to only third party collection professionals. But in some states, the rules apply to original creditors of the debt too.

Clauses of FDCPA

The FDCPA provides regulations regarding the time to make a call, the person to whom the call is to be made and where the call is to be placed. The collectors should identify themselves and should explain the purpose of the call. All the interactions between the collector and client should be recorded for the purpose of compliance and liability protection. If the collector violates the act, then the debtor can file a lawsuit against the collection agency, which could turn out to be expensive and time consuming for the agency.

Need for Recording

The act of recording calls is helpful in instances when claims are made by the client under provision of FDCPA. Without a valid recording of the call, debt collectors may find it difficult to clear their name, in case wrong allegations are made by the debtors. The call recording software used by the collector should have provisions for embedding each recording with a distinct watermark. This will help to identify if the call has been tampered with or not. Recorded evidence is one way of ensuring that the collection agency is functioning in compliance with the rules and regulations of the Act.

The Federal Electronics Protection Act

According to the Federal Electronics Protection Act (FEPA), recording phone calls and personal conversations can be done with the consent of at least one of the involved parties. However 12 states in the US have put forward a clause regarding collection recording, which states that such conversations shall require the consent from both parties who are involved. Connecticut, which is one of these 12 states, has a law which states that consent should be obtained either verbally or in writing at the beginning of the conversation.

But according to a recent legislation by the court, providing advance notice that the call will be recorded is sufficient. If the client continues to have the conversation after hearing the advance warning, then it shall be considered as a consent. The employees of the collection agencies should also consent to the terms of their conversations with the client being recorded and monitored.

Collections Training Resource