Episode 20 Reinventing the status quo

We’re driving down the highway of been there, done that and we just passed a sign that says warning construction ahead. 

Fortune favors the brave, but overcoming fear, and taking risks that will reinvent the future, begins with a different way of thinking. 

In this episode we’re going to explore some of the challenges and opportunities the past few years have brought about from various perspectives, and explore possible disruptive solutions, and an important shift in mindset for  ARM companies of the future,  with industry veteran and thought leader Rozanne Anderson of Finvi formerly Ontario Systems.

Takeaways include

The brand conflict of empathy and the 3rd party debt collector

The shifting role of the debt collector of the future

Remaining challenges with Reg F and possible next steps

Overcoming the consent obstacle

Changing our legacy mindset

Guest:s:  Rozanne Andersen

Rozanne Andersen serves as Vice President and Chief Compliance Officer at Finvi, a widely recognized leading software provider to the collections, healthcare, debt buyer and Federal, state, and local government markets. She leads the organization’s regulatory compliance efforts to ensure compliance solutions are embedded in its software, contact management, payment processing, and cloud solutions.

A licensed attorney and a 30+ year veteran and advocate of the banking, credit, and collection industry, Andersen previously served as former general counsel, director of government affairs, and CEO of ACA International. During her career, she has driven critical amendments to the Fair Debt Collection Practices Act, the Health Insurance Portability Act, and numerous statewide consumer protection laws, and has also served as an expert witness for the Federal Trade Commission and private parties.

Andersen earned her J.D. from the William Mitchell College of Law and holds Chief Compliance Officer certifications from both ACA International and RMAI International. In 2020, Andersen received an international Compliance Officer of the Year award from Women in Compliance.

Transcript

Lex Patterson: 0:11

kindred force media Hello, listeners. I'm Lex Patterson, and you're listening to fair debt. We're driving down the highway have been there done that. And we just passed a sign that says Warning construction ahead. Fortune favors the brave. But overcoming fear and taking risks that will reinvent the future begins with a different way of thinking. In this episode, we're going to explore some of the challenges and opportunities the past few years have brought about from various perspectives, and explore possible disruptive solutions. And an important shift in mindset for HRM companies of the future with industry veteran and thought leader Roseanne Anderson of fin VI, formerly Ontario systems, settle in for a great episode. Here we go. Hi. Roseanne, it's good to see you again. Thank you for coming on the podcast. Good to see you too.

Rozanne Andersen: 1:21

Lex. Thank you for having Yeah.

Lex Patterson: 1:23

So tell us where does this podcast find you?

Rozanne Andersen: 1:26

Today finds me in at home in Edina Minnesota. Oh,

Lex Patterson: 1:30

nice. Nice. So

Rozanne Andersen: 1:32

yeah. Nice. Except that it's snowing. It's windy. Blustery. And it is not conducive to being outdoors. Yeah. You You have my full?

Lex Patterson: 1:43

Well, you're I think you're probably getting the upper end of that weather that we're getting here in Utah, because we had lovely weather last week was seven days. And now we're back into snow, like you're saying and I think that that trough has come in and hit his bowl. So yeah, we need it out here. Because we're Yeah, April is right. We need it here because we're in a drought situation. But other than that, I can't find much to be happy about

Rozanne Andersen: 2:07

it, right. I understand. Yeah.

Lex Patterson: 2:09

Well, I'm sure our audience will recognize you. You've devoted so much of your life to this industry in so many various roles, legal counsel, advocacy, compliance. And I'm sure each of these roles has shaped your perspective, your passion and your career. So I'd like to maybe start this podcast off by just telling us when you entered the industry, and I believe it was in 1996. What did you hope to change, and how had the different events and new requirements especially changed the trajectory of the collection industry?

Rozanne Andersen: 2:44

I would see when I entered the industry, I entered as a one of the attorneys for ACA International. And when I was first hired, it was a telephone interview. And they, the person from HR asked me about my experience with collections. If I had any personal experience that I would share about with collections. I went through the interview at least 15 minutes without knowing exactly what kind of collections are we talking about. So when I literally first entered the industry, I was unaware of its impact on the economy much less than individuals on their on their lives. And it did not take long for me to realize that so many of the members of the industry are very much like many of my family members in the sense that they are entrepreneurs. They're very hardworking. They are very dedicated to their families. And they are literally just, you know, really making a life for themselves as best they can not necessarily at that time based on all sorts of fancy pedigrees, but just really hard working salt of the earth people. And so the reason I'm mentioning all that is because that really was my vision of every member of the collection industry from the standpoint that I wanted to represent them. And I wanted to be respectful. And I wanted to change if I could the view people have of members in the collection industry, because I feel like they were a misunderstood group. And as of last week, I have now realized they continue to be misunderstood.

Lex Patterson: 4:23

Right, right. Yeah. And I think when we talk to you in our pre call before you mentioned the generation of the owners, and has there been a personality change, or is that changed over time, do you feel

Rozanne Andersen: 4:36

it has changed over time. And without putting any value on the change? It has changed in the sense that this is oftentimes an agency may be owned by the third generation, fourth generation. It was not people pulling themselves up from the bootstraps, so to speak at what we these are people with master's from MIT You know, we've got econ degrees, they've got all sorts of Wall Street experience, the people who are running the agencies now. Well, they have the same goals, and they work with the same consumer, so to speak, their approach towards the industry is, is quite analytical not need you're not just personality. Yeah, it's very

Lex Patterson: 5:22

well, and then you've got to combine with all that you've got all the changes that are happening. Regulation wise, right, Reg F, especially, we've had the pandemic, we've got student loan cancellation going on, we've got the great resignation over the past two years, we've seen so much change in consumer finance and in debt in general in our country. May we start off by talking about the impact this is having on companies in the space? What are your thoughts about that?

Rozanne Andersen: 5:54

Well, certainly the increased regulation on the industry. Yes, I can talk all day long about how it increases the line item, you know, for compliance expense, but but really what I thought would happen, particularly with the when the CFPB opened its doors, I actually thought that the increased regulation placed on this industry would have a correspondingly positive impact about its reputation, much like that it's more like a bank. It's more like a credit union has all sorts of requirements that it has to adhere to at the federal and the state level. And all sorts of privacy concerns around that as well. And I expected it to be, well people realize now this is not somebody if they ever did think this, it's not someone in their garage or sitting at their kitchen table. And ironically, what we have now is we have because of the pandemic, for example, we did have people sitting at the kitchen table again, albeit as a remote worker, but it was kind of funny to me to think that that we've gone full circle in that respect. Yeah. I don't know. It's, there's some irony in all this.

Lex Patterson: 7:08

Yeah, for sure. There really is. And it seems like the stakes have gone up in this process, too. You know, and I've heard, you know, as I've talked to a number of different agencies, you've got it's, it's almost like things are being split into a couple of different categories. You know, there are people that are actually closing their doors, because of the increased regulation. And I but it may be more than that, like, I don't know, what are you hearing in regards to that? I mean,

Rozanne Andersen: 7:35

well, in terms of like, let's say, why are people even closing their doors as opposed to selling or expand? Yeah, I would say that. It's, let's think of it like the big box store, and how its impacted the local hardware store. I think, I think it's the way America's economy is kind of being shaped by these kinds of huge big box, the Sam's clubs, the Walmart's, you know, you name it, it really makes it very difficult for the small, even if you want to label it a bowtique organization to function because you just don't get the margin, you just you don't have the volume or the margin, and you just can't make any money. And so I think that is probably one of the reasons that some are literally just closing their doors, some are finding that they're not. They are they're not even no one wants to buy them. And this is the reason the larger organization might respond to an RFP, that typically the smaller healthcare collection agency, for example, would respond to, and these smaller organizations just do not have the the compliance, regulatory the security infrastructure in place to even compete. So they're not there, they're just playing being wiped out of the industry, just through that kind of competition. And the big guys are winning those RFPs. Now, you know, you can find anecdotal evidence around the country where they, you know, hospital A's still wants to use a collection agency, you know, a, but for the most part, it's just that the price of competition is just too

Lex Patterson: 9:13

high. Yeah, the table stakes have gone up so dramatically. And so you're seeing this big shift and everything, which I think kind of leads me into what you and I had talked about would be some interesting conversation, which is, is there room for some disruptive new opportunities, and maybe I'd like to even propose this a little bit more what I call it, you know, because there's all this discussion, and it's been going on for a while and it and coming from a technology background, you know, you hear about legacy technology is a is a term that gets used all over the place. But what I, what I really think is another interesting concept that's going on in the industry is more what I would call legacy thinking, you know, because things have shifted, and this is has been happening for a while. But this industry has always kind of been known as a late adopter, if you will. I mean, they're they're those go out. And they're, they're more on the leading edge, but because of the litigation because of the environment with regulation and all this stuff, I mean, you mentioned this Roseanne, this industry, who spends more time talking about at every conference we go to is compliance, legal risk, you know, and the the amount of headway that's happened in this industry over the last in particular, five years, but going on even before that, but in the last five years has been dramatic. And then you throw on to that the hat, what happened with COVID, and the change in a kinder, gentler, if you will, approach, I think it's been tremendous. Let's maybe get on that topic a little bit about the legacy thinking and maybe some disruptive ideas or some things about how can we change some of the thinking that's going on there? And maybe what are some of the things that could be on their horizon that we should be paying attention to?

Rozanne Andersen: 11:05

Well, the first place, I would if I, if I could snap my fingers and have an audience, with with the creditor community. I would like them to say, trust your agencies lighten up just a bit on the strings, because so many agencies, yes, it's there. It's the fear of you know, it's the cost of compliance. It's a fear of litigation. But I think it's a very real concern of many agencies that pull, sometimes it's I think they make this up, or just use it as an excuse, but they say, Oh, are my creditor clients would never let me do that. Oh, they would never let me and I think there is some truth to that. I think the creditors would say, we'll text our client, are the clients, the consumers all day long, you will not? We do not whether it's we do not trust you. We do not whatever the reason is, there is something lacking in the relationship between the creditor and the actual third party debt collection agency, such that they are tying the hands of the agencies, I think, in an unreasonable way.

Lex Patterson: 12:13

Yeah. Do you feel like that that particular topic, though, is that? You I think you mentioned a little bit about this, or alluded to it? Is it fear based on the agency side, like sometimes what I feel about that is that they're afraid to open that line of communication, because maybe they're afraid that, hey, if I bring any any of this stuff up stuff that's on my mind, maybe they're not going to use me as much as they are, I just want to sit in the background in the back office and let them continue to feed accounts to me. Right, and not ruffled the feathers, you know, right. And, and I think so yeah. So you would agree with that. So I think what the message might be there then is opening those lines of communication actually, will drive the discussion for the some of the innovation because the more you getting embedded into the processes with your client, or the creditor, and the more you understand that, the better you're positioned to take advantage of some of the problems that they're having, as well, you know, so it's, it's a mindset of innovation and connection and communication, more than just filling a niche role that maybe you typically done in the past. Right.

Rozanne Andersen: 13:21

I think that's true. I also think that I also think that if everyone would think about this just a little bit longer, you know, in the healthcare in the healthcare sector, many debt collection agencies do, I always like to put up these religious terms where they act on the image and likeness of their hospital, creditor, and, and the, and they do that in a what we call first party mode. And in that sense, you see this wonderful partnership between the hospital and the agency, the call center, because they're working in tandem toward a common goal, the fundamental flaw with third party debt collection, and this whole dynamic of a kinder gentler industry, is the fact that the very premise of a third party is that now you're one step removed from the wonderful relationship between the creditor and their consumer. And now you introduce this other party that with a different name, that's kind of kind of actually whether stated or not as expected to be alright, we're getting very serious about your repayment obligations. You know what I mean? There's an undertone of that's why we have a third party to our relationship, and they will make you pay. And I think that, as far as I'm concerned, I would trump the CFPB, the FTC, all the consumer lawyers, I've said this for years, I really think, move upstream, go first party and take the Fair Debt Collection Practices Act as far as I I'm concerned and throw it in the wastepaper basket. Now, maybe that would be a disrupter of its own type. But oh, I mean, if you can't, if you can't beat them, then you know, at their at the own data consumers game, the consumer lawyers game, fine, then we'll just act, we'll use all our skills, all our analytics, all our legacy or non legacy software, you name it. We'll just we'll just move an app as we are the creditor, you know, act in that capacity. And you don't need the FDCPA.

Lex Patterson: 15:32

Yeah, well, and a lot of companies have kind of done that, right, trying to do that and move upstream. And some of it, I think, has to do with regulation. But you know, it's interesting, Roseanne, because what you just said about that image. And I hadn't stopped to think about that was really kind of an aha moment for me of you know, okay, now you're going to hand it off to the third party, that's going to be this tough person that's going to come after you so to speak. Even those connotations, which I know, it hasn't, I mean, if you talk to a lot of the agencies today, that's not the conversation. That's not i what's being talked about. It's not out there. But that image, though, and that, you know, because that

Rozanne Andersen: 16:16

was rated by that, yes. The nature of the relationship. It's just playing. But you're right. You know, people do not talk in terms of being aggressive. They because they're proud of being a kinder, friendlier, understanding, empathetic organization. But nonetheless, it's a third party to the original relationship. Yeah.

Lex Patterson: 16:35

Which, which is such a cool, interesting and innovative thought in and of itself, because the kinder gentler part of this is occurring in the actions that are happening in the messaging that's going out and what's happening, I think, even in the interactions that are happening, for the most part with, with, you know, consumers and whatnot. So that's all I mean, even the language has changed the consumers and all that, but we still have this third party. Stigma, I think, if you will, that's a really interesting thought. Yeah. Yeah. Well, so let's talk about even let's go, let's go a little more granular even let's look at maybe the collector. Okay, so there's all this discussion out there about digital. And it just seems like there's this push to self service, we could even get into, you know, there's, I think there's some generational propensity, if you want to call it that I know, with my kids and my grandkids, even at this point, you know, I can call them on the phone, which is the classic tool of the collector, you know, the phone, trying to have the conversation, they will not pick up my call. But if I text them there. Yeah, I think you've got I think you've got this a lot of factors to talk about here. Maybe. But let's talk about for a minute, the role of the collector and digital and I mean, what are your thoughts about? Because the biggest line item on the balance sheet, and you said it earlier was, you know, is still wages and benefits of and primarily the collector, you know, so thanks a question. In the industry trying to be more human. Well, the humans be pushed out by technology. I mean, what are your thoughts here?

Rozanne Andersen: 18:16

They could be where the humans will. The the, the skill sets may change. But I do think it's entirely possible that if it took 100 people to collect the numbers, we'll be off to them doing this off the top my head, but if it took 100 people to collect 1000 deaths, some number of years ago, or even today, in the future, I would think 100, people shouldn't be able to collect 10,000 or 100,000, like the multiple should be quite different. Because yeah. And this is the reason I say that is comes from a few trips to Europe. for business purposes, were one of my colleagues at Finn by originally Ontario systems, we visited a number of collection agencies in the in the UK. And the reason we did that is because it was right when while there were discussions around the GDPR and privacy and the they're just off and changes going on in in the United Kingdom about debt collection, consumer debt collection. And so we went there to find out is there an opportunity for us as a company to make a play in Europe time, you know, for selling software, etc. Sure. Anyway, what we found what it says that before anyone could even begin to talk about the software, or give us a chance to talk about they would ask us, Well, how are you handling financial modeling? Do you have the does your software actually helped prepare a budget for the consumer does it incorporate the credit report and any other debts and obligations into a single view before you even make an offer to a consumer about repaying a debt, because the principle that is alive and well in the UK right now, for example, is that a debt collector shall not as I would not ask you to pay $500 a month, until I have told explain to you the analysis that we have gone through, just show that you can pay $500 a month that you really have the wherewithal to do that. empty promises getting you to sign on the line today, holding your feet to the fire and threatening you with it. Gosh, you name it. That is just not the conversation. And I in in the UK. And I think that's the reason I bring it up, is I think that's where we will ultimately end up. Yeah. And that changes the role. It's not just calling Hey, I called you yesterday, the day before, you know, it's not that kind of tone. It's more like, how are we going to work this out? And let's look at your numbers. Let's look at your payment obligation.

Lex Patterson: 21:10

Wow, that's really interesting. So from your perspective, then and this is again, only from your perspective, and it's probably just limited to that. I don't know, maybe it's not maybe you guys have done a lot more research into that. But I mean, it sounds to me, though, that like the agent there, the job description, even for the agent there was would be far different. I mean, negotiation, is that like, speak to that a little bit? Because then

Rozanne Andersen: 21:34

they would it would be a social worker who understands numbers is really, really picture. Yeah. Somebody who really can Well, if not empathize, but at least sympathize with the consumer that really understands how to quickly get to a view of their situation. How many kids? How many? How many ex wives, how many this? How many dad? How long? Have you been unemployed, any health issues, etc? How do they quickly get a snapshot of this individuals such that they can actually set up a meaningful payment plan. And so that may not be our typical collector, that may not be it may be more someone like a social worker, someone who just has that view of the human condition, coupled with the fact that they had to understand, you know, that five and five equals 10.

Lex Patterson: 22:29

Yeah, which which makes me wonder the effectiveness, you know, just and maybe again, this coming from my, my perspective of, because I feel like there are there are kind of two situations, there's probably more than two, but I'm going to categorize it in just two, right, there are the people that kind of forgot to pay the bill, or they got into a situation where they didn't it's not intended, they didn't really do this or whatever. And then you have another group that, clearly skips, runs, hides, doesn't want to pay the bill. Right. And I don't really know what the what the exact figures are with that. But in late stage collection, I'm sure that's pretty high percentage of what a collector is dealing with is that second group, right. Right. And so then you wonder, how much of this just gets written off in the UK? I mean, do they? Do they get to the do they get to that bottom? Or do they push and question the litigation part of it? You know, because that's always that's an area where it ends up and, and, of course, the courts and stuff. And so I don't have any context. I don't know if you do there. But it's interesting. Well, the only

Rozanne Andersen: 23:39

thing I will say is that whether you know, regardless of how we label it, we're using your two camps of people, the people who have forgotten the people who are basically. However, however, we look at those people, if they don't have the money, whether they have a bad memory, or they're running away from doesn't it's not. So so. So that's, that's really probably the difference in the UK where they are really looking at what is realistic in terms of the amount of money they have now, if these people then fail and breach their own payment plans after you go through all of these, this dog and pony show to figure out how much they have and what their obligations are. There are very there are it's not as though they just the collector and the agency just says okay, yeah. All right. Sorry, good shot at it, but we'll just forget about No, there is litigation involved. There are other other ramifications of failing to, to follow through on those payments.

Lex Patterson: 24:42

Okay, so, yeah, so it's interesting, just the whole job description of the collector. You know, we're kind of we're kind of talking a little bit about to about so this call center, call centers have over 100 people do you think that's The future you think that's going to be going down? Do you think it's going to be bots? And I mean, we're speculating here. I know. But But I think when we talked before you had an interesting phrase that you use, and I'll let you use it, when we were talking about maybe a little bit of the gig economy, with the collector,

Rozanne Andersen: 25:17

is is the one that sounded like a car, sir. Yes. You know, like, two words, anyway. Anyway, yes, I do think that, let's, let's talk about that and hold off on that for just a second, I do think that we will still see large call centers. Because as I said, I think that I do think that the agencies will grow in size, and grow in specialties, like they will have, you know, their healthcare division, their credit card division, you know, you will continue to see student loans or whatever, they will have those kinds of divisions in place, and they will stand they will have hundreds and hundreds of people probably working in a call center or figuratively speaking, they are available by phone. Yes, be like,

Lex Patterson: 26:17

so, do you think then more probably inbound? Are we talking like the Amazon and the Home Depot type of, you know, if you have a problem, then you're gonna get a call. That's what you and visiting? Yeah. Okay.

Rozanne Andersen: 26:27

If you're not able to satisfy and self serve online or through an IVR is already kind of outdated to me, right? That seems like you could die in an IVR. Before you finish.

Lex Patterson: 26:40

There's so frustrated anyway, I was on one with the bank the other day, you know, and it's how can we help you say this say that you say it, then they don't know how to route it? It's

Rozanne Andersen: 26:49

right. Right. If it's really they don't know how to route it. And you're right. If you don't say it, pronounce it with the right articulation with the right x? Yeah, just think of how one bat cannot possibly fit all people in the United States. No one there. You know what I mean? Yeah, just because of dialects and accents. And you name it. So yeah, I'm not a big fan of that. That is but but I do think that that the self serve you know, the internet the metaverse, yeah. How many people are talking about? I just love thinking about

Lex Patterson: 27:25

feet. How's it collection? gonna work in the metaverse, right?

Rozanne Andersen: 27:29

Oh, I know, real or not?

Lex Patterson: 27:33

Right. But anyway, I do with Bitcoin do with Bitcoin? And maybe you know, right, we're gonna get into something else? Or maybe I don't know. But

Rozanne Andersen: 27:43

I don't know. That's for another pod. For today, what what you were teeing up as a conversation that we had about what I you know, sometimes great ideas, timing is everything. And they might sound laughable, but I really don't think this is all that funny. And I think about it as Uber collections. And the Uber simply is to help people understand that when you think about the Uber car service, the driving service that has now expanded to you can have your dog go to the vet, you can have food delivered to your home, you can have, you know, not only just people moving from A to B, it's just fascinating to me how the how we've expanded and we've we've trusted that new new business, actually, this whole new service Well, anyway, with regard to collections, that the thing that I think would be so cool. And if I had the guts that a lot of people in our industry do have to go out on a limb, and brave a new idea. I think it would be I really see Uber collections in that if you picture all the people in the United States who are working in call centers right now, some of whom may say, I get benefits, I don't get benefits. I wish I had a better salary, I don't have whatever all the all the job concerns that they raise. What I think would be cool is if we had somebody, let's say I ran an Uber collections company, what I would do is I would be training people, I would train the medical people collectors, I would train the student loans, I would train the credit card, I would train the bankruptcy paper train the decedent debt collectors who collect the student debt. And those would be unique specialties in my people would be certified in each of those. And when they are ready to go to work, they would log on much like an Uber driver does. And they say I'm ready to work for the next three hours or four hours. And then accounts will be presented. And and it's just a completely different concept. But the idea would be is that if they would be on call, if you will, and when these various consumers are needing assistance, though their payments aren't going through or they want to fill in the blank. If they will have an Uber, they will have x the consumer has access to a collector 24/7 whenever they want it, the collection agencies can basically ramp up or ramp down depending upon their inventory and what what, what, what they need to collect at any given time, the actual collector experience is going to become much more flexible. And the company if I owned it, I would be the one just like Uber that provides the benefits that manages the their income, you know, their withholding, and all that sort of thing. And I really think that's a way for people who own agencies now to relieve themselves of the constant attrition issues, constant training issues constantly. You'd have a lot of times if you speak with the owner of a collection agency, and you say, Oh, how many employees do you have today? They invariably What did they say? Well, I have 300. But that was this morning. Yeah. By the afternoon. I could have 250 Yeah, yeah, there's

Lex Patterson: 31:04

Yeah, sure. Yeah. You think about the reason for the churn. Right. So So again, part of that is it's a tough job. I mean, you know, yeah, how much pressure is on I can remember, the days of the dialer, we actually, you know, would have this little mock up that we did at one of the conferences, I was at where it was a mash, it was like a MASH unit. And there was a guy there with a headband with his ears bleeding, because he'd been on the dialer, you know? Yeah, you know, because those calls getting fed to him, they've got to try to deal with these situations and jump into solve problems, think on their feet, use the proper language and everything. And so you go, that's tough enough, the thing that you just described, which is fascinating, if you shift the perspective into really the consumer view, okay, so it's not about, again, your thought of moving upstream a little bit. And even in your thinking, let's go back to legacy thinking, right, you're moving upstream, you're an extension of the customer service. So you're trying to solve that you have this person log on that can give their time. Much like, for instance, you know, JetBlue, what they did with, you know, they hired a bunch of aging, they were older. Women, I think a lot of them were or women that had kids at home and stuff that just opens up that whole pool, right? It does. And then what you've got is you've got technology sitting as an overlay, because we already are at the point where we can monitor conversations we can key into with voice recognition technology, you can key into, okay, this conversation is getting heated up. Let's offer them another route to solve their problem. But it's all about delighting the customer and taking care of them not, you know. Right? Not.

Rozanne Andersen: 32:51

I just think I think that is just so true. And when you think about it, have you ever had to call a cable company, for example? Oh, jeez. Yeah. I mean, we've all I've had that I have to almost physically bring energy to that phone call before I even tried to reach someone, you know what I mean? Yeah, it is, it is, because it is so exasperated. And that is what we do not want the consumer experience to be when they really raise their hand and say they need to speak with an agent or a representative. You know what I mean? That is that is the worst thing, the worst thing? And really, why would Amazon Have you ever had this experience? I did this happen that Christmas? I ordered a skateboard for my grandson was the wrong one. It wasn't a big long, cool one. It was like a regular escape what you call it? So I call Amazon and they and I'm, I'm barely I barely have to say skateboard. And they're saying, Don't worry, I see it here. What's Is there anything wrong with it? No, no, no. I said, I think I just ordered the wrong one. They said don't worry about it. In fact, they said in this instance, but I don't even get this. Don't even send it back to us. Give it away to somebody else. We're just fine with you keeping it. That's the end. Can you even believe that? Like I thought, are you kidding me? I mean, I just keep the skateboard because reason I call this I didn't really know how to send it back is a long story. But anyway, but they were just so accommodating. Now, I'm not suggesting that people should be able to call a debt collector lesional to say, Oh, you're right. Forget about paying. That's not what I'm saying. But that that that caught that trust in that comfort level would be so great. If that could occur.

Lex Patterson: 34:38

Yeah. The and here's the other thing, too, that I was thinking about on that is maybe we're not expecting the experience to be that way with a debt collector. Let's say however, our anticipation we're used to that kind of service, you know, oh, it's not right. That is customer service. Right. Right. So So I mean, That's, again, that mental shift of, you know, I don't know if we could ever get to collection being the Amazon experience, but But man, but But you know, I think there's a long way to bridge towards that gap. And especially if we go back to what we talked about earlier, which is the legacy thinking and trying to think of ways, how can we take the friction out of this? Very friction loaded? conversation, right? Yeah. So I don't know, I think I think as we get deeper into digital and omni channel, in particular, being able to hand this off to different channels, depending on where the need is and what the consumers desire is, and and again, with the delight, we can maybe get there. I mean, hey, what do you think are the biggest challenges right now that they are in departments and companies are trying to navigate in general? Roseanne? I mean, when you when you talk about the discussions you're having, and all the things that we've been talking about, we're coming out of the transition of COVID and hybrid and remote and, and the great resignation and hiring people in regulation F. I mean, there's a ton of things we could jump into here. But what do you think? What do you think is going on? What are their biggest things they're trying to navigate?

Rozanne Andersen: 36:22

What well, one of the, but you know, the trouble is with any question, you ask them a person, I only have my perspective. Exactly. Yeah, I'm limited to that. But yeah, when I speak with agency owners, we have a very large client base of people in the in the industry.

Lex Patterson: 36:41

You got a conference coming up, too, right? Yeah, yeah. Power. Yeah. Yeah.

Rozanne Andersen: 36:46

In New Orleans in June. Yeah. Anyway, but, yes, it's pretty fascinating. The number of the number of people we get coming to that thing.

Lex Patterson: 36:59

I heard. I heard or Ma, I was just tremendous. Yeah, attendance this year as well. So yeah, I think it was ready, you know.

Rozanne Andersen: 37:11

But But to your question, I think what I was getting at is that, from my perspective, what I think is that, how can we keep people in their seats, the collectors that we need to have in our seats? How can we end and balance that with the, let's say, Nevada, you have to send a certified letter to somebody before they before you can even collect their medical debt? Right? Whoo hoo, that is very, that's exasperate into the collection agency. And the legislation is insane. Like, why would you make somebody pay$8.95 To send a certified letter to a consumer that probably is terrified of opening a certified letter? And I don't like receiving certified? Yeah, I don't. Anyway, and but I think it's some of those did some of the costs that they just have to incur and eat right now. That's making it extremely frustrating. On the other hand, on the other hand, I will I'm amazed at some of these larger organizations, they are efficient, and they are, they are all over these digital communications. And when they when I say that, when I say that what I mean is, I don't think is particularly cool. Or noteworthy if the agency says, Oh, yes, we text. Because what you have to find out is, do you text consumers in such a way that it actually relieves the pressure and strain on your floor on your agents, and people are doing more with that text? Just sending text to consumers is so stupid, like you're to me, if you're not reducing your headcount at all? Like there's no there's no follow you're doing is now texting in addition to calling and mailing letters and doing everything else, you really I think what, to me, what we really need for our agencies is they have to see the path to using some of these digital communication tools and using them in a way that they are that they understand how to do it, how to how to comply with any requirements surrounding that, and then do it to relieve relieve the pressure on the on the agents, if you send the guy the person was bleeding from the headphones, you know, from all these mother calls that he has to manage. So we'll see Yeah, it's

Lex Patterson: 39:35

really interesting. Just that whole conversation, you know, of the shift that's happening. It is so

Rozanne Andersen: 39:44

do you know what else is great too is I think, so we talked about texting and emailing like, like it's some recent invention, you know, it's not. Yesterday I had a conversation with a fellow who is bringing to market I think it's just wonderful. It's a it's a screen notes. It's like an automated system that it's listening to the to the agent speaking with the consumer, and the system is recording the screen notes, it's like writing them out into the screen, the debt collector doesn't have to literally key something in. And the end, it's and then they can use speech analytics like to read the transcription to make sure that it's there no gaps that there are no comments that are inappropriate or whatever, but and they use it for training purposes. But just think about the fact that you you take the time you take you increase the efficiency of an agent, because they no longer have to sit there and wrap up a call in the traditional sense, or enter screen notes in the way that they normally Yeah, that's a lot of

Lex Patterson: 40:52

it's interesting, too, I use that very technology. On my podcast, I use a transcribing service where I take our conversation, it will transcribe it, it's very effective. It's very inexpensive, it's, it does a great job. You know, the other thing about it is both with the texting thing, it's not just the idea of the business impact, you know, I feel like to the to the agency, you know, eliminating headcount, or reducing headcount, or whatever. It's also that, that removing, again, trying to remove the friction in the interaction, because if you think about it, text, okay, does it improve the experience? Okay, it's one thing to look at it on the business side, but on the other side, is it? Is it really more convenient to get a text or not? You know, is that really what they want? And then same thing with this technology? You know, if if I'm talking to you, and I've got to worry about, let's say, even right now, I've got to worry about taking notes over here? Right? I'm not fully I'm not listening, I don't pick up on nuances with you, I'm more concerned with making sure my compliance is taken care of, because I got to take these notes and put them in history, you know?

Rozanne Andersen: 42:00

Right. So right now there's that no, that's absolutely true.

Lex Patterson: 42:04

So that mental shift is is really, really keyed, what we're talking about. Let's talk a little further then on maybe some other shifts that maybe you think may be coming in the future. You know, when it comes to like, one thing I'll throw out there, just as a question, you know, that I've heard with REG F, and the changes that are there, there's a little bit of trouble, I don't know another way to put it maybe just challenge let me maybe rephrase it that way with data exchange with companies that are getting so they have their creditor, they have the client, and they need particular dates, they need particular information to be compliant with REG F, but yet the client doesn't even it's not reg F isn't even on the client's radar. You know, they don't even know what it is. Now, they're trying, you know, trying to educate them now. And then they're saying, Oh, well just choose this date, or just use this instead of this. I mean, have you run into any of that type of thing? You think that's a?

Rozanne Andersen: 43:01

I do think that's a huge problem. And I and I blame the CFPB. for that. Here's what I do, when they first came out with this with it was this a brief outline, I want to say it was in August of 2016, I could be off a little bit where they came out with their first iteration of these new rules for debt collection. And when they first rolled that out, you could see that they were going after the creditor and the debt collector on a parallel track, where they would expect the creditor for heaven's sakes to provide substantiated information to the court. Yeah, right. So then now what happened? I don't know, some banking lobby must have just done a number on this Congress, or whoever's speaking to the CFPB in the background, and they said, for heaven's sakes, leave these creditors alone. Just go after the debt collector. So it's just like regulating. It's kind of like regulating the waiter at the at the in the restaurant. But you know, the kitchens, just a wild mess in the background. So yeah, I really think I blame the CFPB. Because all these dates all this data that the CFPB expects the debt collector you have before it initiates collection activity is is only possible with the cooperation of the creditor. And what are you going to do? I mean, not I know, yesterday, I another day, yesterday was a busy day with some of our clients. And one of them said, we're sitting on $8 million worth of accounts face value of accounts, because the creditors cannot find the information that we need, and we are not willing to go out there and just throw ourselves to the consumer wolf attorneys, you know, right. We're not going to do it. So

Lex Patterson: 44:57

and who would blame him? You know, right. And there's just there's just seems to be a lot of issue around data exchange. And that loop course going back to what you said earlier, a brilliant solution to that if we could close that connection between creditor and, and the third party entity, we, you know, a lot of that goes away. So that's a, that's a big message, I think. Something Something definitely, let's hope we put a little grain of something in somebody that's listening to this as here and we see some change there. So what else? What are some other things on the horizon that you feel would be shifts in, in disruptive type things? What else? Can

Rozanne Andersen: 45:40

we talk for the for the, for the for the collection industry? Probably. I don't know that this would be disruptive. But we just talked about how creditor data is still relevant and important to the collection process. The other piece of this is getting our hands around our arms around consent. Yeah. And what are we really what really are we expecting from consumers? Like, why? What are they consenting to? You know, in the, in the, in the world of Joanne fabrics? For example? Yes. I mean, I have to, if I want to receive text from them, I just mean, they can text me and then I say yes. And if I don't want them to text me, I say no. Or I can say stop whenever I like, it's pretty simple. But for heaven's sakes, when it comes to collecting something that you've already purchased, or the service you receive, receive, oh, oh, my heavens, let's make sure you're, you're with

Lex Patterson: 46:37

some friction into this.

Rozanne Andersen: 46:39

Yeah, what might like to, to what? And so there again, I pushed upstream? What is happening at the creditor level when they're when they're selling their widget or providing their service that, you know, they should they should actually be responsible for obtaining some of this information from their consumers? If they if they want their receivable to have any value?

Lex Patterson: 47:01

Yeah. Yeah. Do you think, though, in terms of consent, and the dilemma that we have in the dance of the Scorpion, and all that stuff that's been kicked around? You know? I mean, do you think or do you have some ideas on on how that could be solved it even the third party level? I mean, are there? Are there steps or thoughts that you have about? You know, because it's a great idea to first of all, just to recognize what you're saying about the greater connection, or the more tighter integration of connection between the creditor and the party that's trying to help out on that side, you know, having them be able to operate under some of those same rules, it'd be awesome. But let's face it, we're in the real world here. And I've been doing this for over 30 years, and I've seen so little movement. I mean, thank goodness for REG out, but that took 30 years to try and get. Yeah, so I mean, let's say we don't have that great opportunity. And I'm the third party side. What I mean, you got any thoughts about consent management? That would be? I mean, we're spitballing. Again, let's just

Rozanne Andersen: 48:09

one thing, I do think that, and I know I'm saying this at a time when it sounds like I haven't read the newspaper, but, you know, credit reporting is volunteer. And one of the in this I will bring this back to question, but credit reporting is voluntary. And I think that's a fundamental flaw. When it comes at least to Well, I just think it's flawed because I don't think credit creditor a and collection agency, he should be voluntarily choosing a credit report and the others don't. And there's no uniformity for the consumer, I really think that credit reporting should help somehow also be used to manage consent and demographic information about the consumer that any one who's permitted to pull a credit report has the right to use and rely on Oh, that's interesting. I really think that we've missed something there. Because now we won't we clear the Fair Credit Reporting Act requires anyone who pulls a report, you have a permissible purpose. One of the permissible purposes is that you are engaged in debt collection. Well, as far as I'm concerned, the creditors they should be everyone should be credit reporting, in my opinion, and part of the credit report metro to document you know, the Metro should have a consent status. And that should be kind of like you need the name of the person you need their. You need their address, and you need their consent status on some of these things. I mean, I really think that would be really helpful if we somehow tie them all together. Because right now, it's all piecemeal, and there's is no unique. There's no consistent consumer experience surrounding all of this stuff, nor is there for the creditor or the collector or anybody else in the venue.

Lex Patterson: 50:09

Yeah. Which which goes back to, in my view, I'm gonna just I guess I'll phrase this in a bit of a question. But it seems like, what would be a really good solution to this would be to, to get that triad, you know, you've got the consumer, you've got the creditor, you've got the bureau, I mean, maybe it's even a fourth, which would be the any party that's tying into that creditor. Umbrella, be able to connect those because I feel like there's a disconnect, like I've I've seen this a little bit in my own personal life, you know, like there's a disconnect for even for the consumer sometimes, but behind what's really going on with the reporting. You know, you've got fraud, you've got cases where your your credit report gets pulled, and maybe it's even a soft inquiry, but it ends up impacting you. And you didn't know that. And, you know, there's all these situations around that. So, back to what you were saying earlier about the greater connection, it's, it seems like that's another way that that if we could pull that together and get a tighter conversation going on, that would solve maybe a few problems that

Rozanne Andersen: 51:16

I think it would and I also think it's funny to me, when I see that all everybody, it's already mandated that you can get at least one free credit report a year as a consumer. So we've already said we've got these little bits and pieces that have, we could put them all together. So we have consumers that already have the right to get a free. You know, it's not as though I'm seeing something where it will cost the consumer $25 to know what is being shared about them. But if they had some way to interact with their report, update, consent. Revoke? I don't know you use it, it was more of the Mother, mother ship of the of the financial service.

Lex Patterson: 51:57

Yeah, yeah. Yeah. So there's a mothership being, there's one central place that contains all this information that people agree, can can be used for these purposes, used for, as long as there's education and consent on that that's part of that's part of the benefit of using a service if it's used correctly, because I think the voluntary part, what's happened there is a lot of people I know, are just saying, you know, what, I'm not going to report. There's too much legal risk in this. I'm not, why would I do this? You know, and, and before it was used, I think a little bit as a leverage tool, you know, and still use it that way. To a certain degree, we've got all this legislation coming out with the medical debt, you know, stuff and that too, right. Yeah, it's a very interesting consent is, is a big deal. And especially as we move into these new methods, you know, letters, letters forever, the whatever, but you know, with email, emails, maybe even a little bit further down the line, but these aren't new technologies, either, you know, they're all this What's your so there's nothing, no exciting about this, but they're not it's just the whole who's brave enough to dip their toe in the in the pond?

Rozanne Andersen: 53:12

And then let's, when you think about it, you know, this whole reassigned number database, I don't know how familiar you are with that. Yeah, that's but the Federal Communications Commission now has this reassigned number database, that what that means is that if your cell phone has been reassigned anybody who's trying to text could go to the or leave a room for message or whatever, the collector is accredited anybody, they can go to this database and find out that if the number that they think was associated Roseanne, they can find out if it's still associated with me or not? Well, those are, again, there's another tool hanging out there, where we're already dancing around this is this one place, what for the consumer to get a view or a snapshot of the consumer, what they want, where they are, where they live, what they consent to what they don't, etc, so that you have to have that's where I think regulatory action should take place. Not telling us we really don't know about how bad was seven attempts? Yeah, we

Lex Patterson: 54:19

are a tariff, a tariff stub on paper.

Rozanne Andersen: 54:24

A tariff stuff on a paper letter that doesn't require an envelope or a stamp sent to people who don't know how to address envelopes at the time, much less Yeah, I will stamp so I think it is that that is another stupid one. That's just stupid. Yeah. And then medical credit report you should probably because I'm gonna get I'm gonna get mad at you go. No, I know that medical credit reporting that everybody's talking. Oh, do you know that? My understanding is I'm not at that medical does not even consider when someone is trying to buy a house or a car anyway. So it's really just a bunch of politicians. As far as I'm making a lot of noise about something that in the end, you know, consumers might be afraid. Oh, I better pay off my tonsillectomy. That's true, but I don't know that it's preventing them from buying a house. Right? I don't think right.

Lex Patterson: 55:24

Not in all cases, that's for sure. It goes back to that ability to pay I believe, right. So you know, yeah, yeah, right. Right. Okay. Well, here's one, maybe we can wrap on, is there a challenge that you would give companies in this space?

Rozanne Andersen: 55:38

Yes, I think the challenge would be I really wish people understood the consuming public better. I really think that if, if I were going to sell tennis shoes, as a manufacturer, I would know my audience upside down inside about what my audience for buying tennis shoes. Okay. But do we spend money in debt collection? Understanding the consumer? Do we have focus groups? How much marketing information do we use? Do we really understand these people like we would if we were selling, like selling tennis shoes? Yeah. You know what I mean? I really think that that if forget about everything else that we've talked about, I really fault the industry. Night, I mean, being a mean way, but both if they don't even they don't really understand who their Yeah, their audiences. I don't

Lex Patterson: 56:35

really think Do you think that's a shift you've had to just over the last few years? I mean, do you think, do you think that that challenge or that thought, because we're all part of the industry, you and me and everybody, and so when you say that it's in a way, you're faulting all of me to YouTube, right? I mean, it's up to all of us, you know, but yeah, my my thought when you were saying that was, I really agree with that. I don't know, if two years ago, three years ago, I would have I would have thought now wait a minute, you know. So there's been there's been this big shift. So maybe a way to maybe to add to the just to tag on to the end of that is embrace the shift. But what is it really teaching us and then let's think about that legacy thinking we need to get forward thinking we need to come out of this, this stigma that we've created in a way we've helped perpetuate right? Yeah. And come out on the other end of that. Yeah. Yeah. I agree. Yeah,

Rozanne Andersen: 57:34

I agree. Yeah. Many opportunities. Yes.

Lex Patterson: 57:37

There you go. Well, I gotta tell you, Roseanne, I sure appreciate you coming on. It's been a pleasure to have you we've had some great conversation. I agree.

Rozanne Andersen: 57:46

Thank you, Lex.

Lex Patterson: 57:47

I appreciate it. Hope to do it again soon.

Rozanne Andersen: 57:50

Thank you. Yeah, take care.

Lex Patterson: 58:09

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