Compliance and a Forward View for the Repossession Industry Presented by: Paul Kulas Head Belle Ringer, BellesLink.com
Compliance and a Forward View for the Repossession Industry
Oct 21, 2014
These are the slides from a presentation Paul Kulas, Head Belle Ringer at BellesLink.com, gave at the April 2013 NARS conference in Dallas.
BellesLink is a fully compliant, cloud-based, virtual communications tool for Automobile Repossessions, Investigations and skip tracing. Compliance with Federal communications regulations is an important feature of BellesLink.com.
Here’s Paul’s view of the coming changes, driven by the Consumer Financial Protection Bureau, that are effecting automobile repossession industry.
Paul says:
My view is that compliance is a big opportunity for Repossession companies. I believe the data all points to a boom, just around the corner. However I feel that in order for the industry to realize what I see as significant opportunity, some changes should be considered.
Consider that by making investments in compliance, clients see you thinking ahead. They get that the steps you’re taking result in an investment in their business, which can only strengthen your relationship with them. I believe that investments in compliance will be a competitive advantage.
Car sales are on the rise, on the way to eclipsing the all time high. Used car sales are strong. This is all great news.
The trends will lead to an inevitable increase in complaints with the CFPB. Recently the government/CFPB filed lawsuits against players from the housing crash. More are sure to follow. The CFPB has easy to use websites, they’re on Facebook and Twitter. They’re hiring. Now, with the recent NSA scandal, privacy is on everyone’s minds -- more issues for the CFPB.
I come to three conclusions: enforcement will be on the rise, CFPB wants to increase awareness with consumers, Repossession companies should view it all as great opportunity.
Finally, the slides present a forward view for the Repossession industry. I’m calling for end to the partisanship, the politics that I feel, have worked against the industry. Instead, I think the model for the industry going forward is co-opetition.
BellesLink is a fully compliant, cloud-based, virtual communications tool for Automobile Repossessions, Investigations and skip tracing. Compliance with Federal communications regulations is an important feature of BellesLink.com.
Here’s Paul’s view of the coming changes, driven by the Consumer Financial Protection Bureau, that are effecting automobile repossession industry.
Paul says:
My view is that compliance is a big opportunity for Repossession companies. I believe the data all points to a boom, just around the corner. However I feel that in order for the industry to realize what I see as significant opportunity, some changes should be considered.
Consider that by making investments in compliance, clients see you thinking ahead. They get that the steps you’re taking result in an investment in their business, which can only strengthen your relationship with them. I believe that investments in compliance will be a competitive advantage.
Car sales are on the rise, on the way to eclipsing the all time high. Used car sales are strong. This is all great news.
The trends will lead to an inevitable increase in complaints with the CFPB. Recently the government/CFPB filed lawsuits against players from the housing crash. More are sure to follow. The CFPB has easy to use websites, they’re on Facebook and Twitter. They’re hiring. Now, with the recent NSA scandal, privacy is on everyone’s minds -- more issues for the CFPB.
I come to three conclusions: enforcement will be on the rise, CFPB wants to increase awareness with consumers, Repossession companies should view it all as great opportunity.
Finally, the slides present a forward view for the Repossession industry. I’m calling for end to the partisanship, the politics that I feel, have worked against the industry. Instead, I think the model for the industry going forward is co-opetition.
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Transcript
Compliance and a Forward View
for the Repossession Industry
Presented by:Paul Kulas
Head Belle Ringer, BellesLink.com
2
Originally Presented by Paul Kulas at NARS, April 2013
• Owner and Head Bell Ringer at BellesLink.com• Owner of Belles Camp Communications• Developed key communications services for the
Repossession Industry dating back to 1991
3
Compliance is No Longer an Option – It’s Required
• CFPB – where it is today• Where we think CFPB is heading
– Why repossession operations should consider making changes
– Why these changes will benefit you – even if I’m wrong
• Techniques for skip tracing that are fully compliant• Observations, present and future vision for
Repossession Industry
5
…financial institutions under Bureau supervision may be held responsible for the actions of the companies with which
they contract. The Bureau will take a close look at service providers’
interactions with consumers. It will hold all appropriate companies accountable
when legal violations occur.source: CFPB Bulletin - April 2012
6
Compliance
• No standard definition• Widespread opinions• Everybody’s talking• An investigation will be broad ranging and
cover every aspect of lending operations*– Loan servicing – Repossessions
*source: Dealer Business Journal – June 2012
7
Consumer Finance Protection Bureau
• Title X of Dodd-Frank Wall Street Reform and Consumer Protect Act
• Comprehensive change in financial regulation• Extended rule making authority to ‘larger non-bank
participants• Indirect supervisory authority
8
Consumer Financial Protection Bureau to Hold Financial Institutions
and Their Service Providers Accountable
“The Bureau will take a close look at service providers’ interactions with consumers. It will hold all appropriate companies accountable when legal violations occur. “
CFPB Director Richard Cordray
April 10, 2010 CFPB Bulletin
17
CFPB Full Time Employee Projections*
*source: April 2013 CFPB Strategic Plan
18
Where We Think CFPB is Heading
•Indicators are CFPB will grow – therefore:– Every communication (calls, texts ,emails) should
be linked to a case– Each database lookup should be linked to a case– Every communication and all database lookups
need to be in one place, available with one mouse click
19
Our Qualified Intuition
•Belles Camp has 22 years of experience– Key innovation and communications techniques for the
repossession industry (trap line, blind line, real-time caller ID, etc. dating back to 1991
– Remember the slides? Solid evidence there– Predicted in 2007 the amendment to the Communications
Act (making spoofing illegal) would become law. Law signed 12/22/2010
– Saw CFPB coming. Software and hardware development began early 2010
– BellesLink introduced July 15, 2013 - leading the way again
20
Repossession Operations – Today
• Information doesn't flow between all the channels in a repossession
• "Quit calling me!" - way too complicated • Clients are concerned about risk, primarily due
to the fact that everyone isn’t connected
22
Changes You Should Consider
1.Build your business with the client in mind2.Link every communication (call, text, email)
and database search to a case3.Everyone involved should be connected,
information updated in real-time1. "Quit calling me!"? Should be one click
4.The cloud is ready – it’s not hype
23
Communications and database
searches linked/updated in
real time
✔
✔
✔
✔
✔
24
Compliant Communications Techniques
• Local Numbers and texting– Local Numbers
– Dramatically improves contact rates (incoming and outgoing calls– Reviewed and approved by Chase Auto Finance*
– Texting• Important technique; essential to every skip trace• Becoming more popular than phone calls• 95% of texts are read within 5 minutes• Wells Fargo* reviewed and approved
• Toll Free numbers still valuable– when used with local numbers
*not meant as an endorsement
25
What About Deception?
• Local/toll free numbers, text messaging are not deceptive- You lease the number and can be
reached at the number- Chase* and Wells Fargo* have reviewed
and approved.- Fully compliant with Truth in Caller ID Act
of 2009
*not meant as an endorsement
26
What Not To Do
• Don’t try to put a square peg into a round hole - i.e., using Google Voice, Ring Central, or burner phones for skip tracing– They’re not designed for what you use them
for – There’s no support– You can’t suggest improvements– At least 10 other reasons
• Net is that you trip over a dollar to pick up a nickel
27
Now What?
• Invest in your core competency - and in your client’s business
• Cloud compliance services are the way to go• Repo industry has unique
challenges—choose/support companies that focus on your business– When you call, they get it—they listen and
respond
28
BellesLink.com is a fully compliant, cloud-based, virtual communications tool for Automobile Repossessions, Investigations and skip tracing
•Unique.•Affordable.•Valuable.
29
Risk/Return on Investment
• Risk:– Letter comes: "You have 15 days to comply with the
following requirements…” Now what?• Return on Investment:– If CFPB goes away, never extends its reach beyond
where it is today, you're way ahead• Linking your communications and database searches to the
case improves day to day operations
• Makes you more marketable to your clients– When the letter comes: you’re ready
• Make or break moment in your business
30
Observations, Present and Future vision - Repossession Industry
• Merger (ARA/NFA) great 1st step, long over due• Co-opetition - it works. It’s been around since 1911
http://mayet.som.yale.edu/coopetition/ • Examples of successful co-opetition
– The Auto Industry• GM/Toyota – fuel cells GM/Ford– gas saving transmissions
– Oil/Gas business in Denver, early 80's– Microsoft/Apple– Symantec/McAfee– Google/Firefox– Open Source Software
31
Conclusions – Part 1
1. Automobile lending and sales could surpass the boom years - delinquencies can only go up from here - great!
2. CFPB isn't going away1. Well designed website, easy to complain, social media,
they’re hiring…3. Probability high, you’ll be a bigger blip on their
radar 1. Can you afford to ignore the signs?
4. Be proactive—not reactive5. Technology is an asset—not an expense
32
Conclusions – Part 2
1. The past is not sustainable. Compliance = cost.- Fees have to increase
2. The way forward:- Industry unity - Power in numbers - Metcalfe’s Law: “The value of a
network increases exponentially with the number of nodes on that network”.
33
• "Co-opetition means cooperating to create a bigger business "pie" while competing to divide it up”http://mayet.som.yale.edu/coopetition/
“This is the year of change!”
Les McCook, Executive DirectorAmerican Recovery Association
Embrace Co-opetition
To learn more about BellesLink repossession and investigation software for skip tracing, visit
www.belleslink.comRequest a Free BellesLink demo.
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