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Cedar Financial Helps Debtors and Organizations Weather COVID-19

CALABASAS, Calif., April 3, 2020 – On the outskirts of Los Angeles County in California, the parking lot of Cedar Financial’s Calabasas headquarters is eerily empty. Without the steady rumble of cars of passing by on the 101 freeway, it’s actually somewhat serene.


Last week, the property manager announced that a few employees in the neighboring offices tested positive for COVID-19. Since then, most businesses in the park have either gone remote or been placed under mandatory self-quarantine.

But the offices aren’t completely empty – skeleton crews still pop in to accept mail and keep things running, all while maintaining a safe social distance and making liberal use of sanitizing wipes.

At Cedar Financial’s Lahore, Pakistan location, everyone who can work remotely, is. Those required to go into the office face additional challenges, with police stopping, questioning, and, in some cases, getting physical with them in the streets to enforce the lockdown there.

“I find it really inspiring that, even after being harassed and even beaten by police, people are dedicated enough to continue to go to work to do what needs to be done,” says Amir Erez, CEO. “Everyone has really stepped up to get us where we need to be during this situation.”

Safer at Home: A Week of Rapid Change in LA

One of the major urban travel hubs of the United States, with a population of over 10 million people, Los Angeles County was one of the first areas in the US with confirmed COVID-19 cases.

While most people weren’t sure what to think about the outbreak at the beginning of March, that quickly changed. Within a single week, Angelenos went from business as usual to being confined at home for the foreseeable future.

On March 13, the same day President Trump finally declared a National Emergency, Cedar Financial’s executives met with staff to review COVID-19 policies, urging everyone implement social distancing and take the virus seriously.

Signs had already been posted up telling people to wash their hands, avoid touching their face and sanitize often. Now agents’ desks were to be spread at least six feet apart, lunches were to be taken at desks and any meetings or one-on-ones conducted via video conference. Anyone who could work from home was encouraged to do so.

That same day, grocery shelves were left bare as people made a run on toilet paper, paper towels, canned goods and more. Hand sanitizer was already long gone.

By the following week, most of the staff was working remotely, keeping touch through instant messaging and text.

Coronavirus Timeline in LA

Thursday, March 12, 2020
Los Angeles County Reports 1st Coronavirus Death

Friday, March 13, 2020
President Donald Trump Declares National Emergency

Saturday, March 14, 2020
Disneyland, California Adventure Close

Sunday, March 15, 2020
LAX Airport Begins Screening Passengers for Coronavirus

Monday, March 16, 2020
Schools, Bars, Gyms, Movie Theaters Close Restaurants Limited to Take-Out, Delivery Only

Tuesday, March 17, 2020
California Courts Shut Down

Thursday, March 19, 2020
CA Governor Issues Statewide “Stay at Home” Order
Global Travel Advisory Raised to ‘Do Not Travel’

Friday, March 20, 2020
Los Angeles Mayor Issues “Safer at Home” Order in LA County

Virtual Teamwork: Adapting to a New Reality Together

Now into the second week of sheltering in place, people are starting to feel a bit stir-crazy, either missing social interaction or having too much interaction with close family.

“It’s definitely a challenge working with kids in the house. Everyone needs to be quiet and mindful of others while they are working. Sometimes you have to go out and work on the porch for a while,” says Amir.

Others are grateful for furry companions keeping them company.

“If it wasn’t for my dog, I would be losing my mind over here,” says Dell Holden, Director of Sales.

Despite tough circumstances, Cedar Financial isn’t giving up.

At a time when so many other companies are struggling or shutting down completely, Cedar is pivoting to make the changes needed to survive this crisis, rapidly deploying a remote workforce and working together to find new ways of doing business.

“To keep our agents safe, we rented laptops and configured them for security in record time. I’m grateful to our IT team, who worked 24/7 to enable our team to work remotely,” says Amir.

It’s not just the IT team that is stepping up – every department has rallied together, making virtual plans to stay strong and succeed, day by day.

“We have daily huddles and video conferences. Every time a payment is recovered, it is announced within the team,” says Amir Erez. “We’re helping each other more and fostering a camaraderie that can only be found in facing difficult challenges together.”

Coming Together as a Global Community

Cedar Financial isn’t just helping employees – it’s helping the community at large.

“We have to remember: no one has experienced what’s happening right now,” says Alan Fasssonaki, Vice President at Cedar Financial.

“This crisis is somewhat unique in that everyone around the globe is feeling the impact,” says Amir. “Community no longer means the immediate people in your surroundings – it means everyone, the whole human race. And we all have a responsibility to do what we can to help.”

For most, that means following stay-at-home orders and social distancing guidelines to help flatten the curve and reduce the impact on healthcare systems.

But companies can help as well.

“In our area, we’ve seen businesses go the extra mile to help their community,” says Kaitlin Lindros, PR Manager. “Restaurants are making meals for children who can’t go to school; stores are making and donating masks for medical workers. It’s very inspiring to see everyone coming together like this.”

Cedar Financial is doing what it can, on the collections front and as a contact center service provider, providing financial options and contact center support to those in need.

A Case for Compassionate Collections

While some debtors are still working, receiving unemployment or have the means to pay their bills, many more have had their hours reduced, been laid off or gone out of business.

For those feeling the impact of Coronavirus, Cedar Financial wants to help relieve their financial burden, one way or another, even if that means postponing payments.

To help debtors learn about new flexible options, Cedar Financial created Coronavirus-specific scripts and engagement emails designed to help debtors get through this crisis. The new communications focus primarily on empathy, safety and financial security, providing links to resources and options to reduce or postpone payments, if needed.

“Instead of calling again and again to demand payment, we’re asking permission to check back in, just to make sure people are doing okay,” says Justin Franklin, Collections Manager. “We want to maintain relationships and build trust, so that when the smoke clears, people will be ready to work with us on their accounts.”

“We want people to know that we care, that we’re willing to work with them to get through this,” says Kaitlin Lindros, PR Manager & Content Writer. “We want to show that we really are a People-First company.”

Helping Contact Centers Go Remote

Cedar Financial has also launched Cedar Contact – emergency remote contact center services designed to help organizations, businesses and government entities around the world cope with the crisis.

“Essential businesses, like medical providers, emergency hotlines, nonprofits and government agencies, are experiencing enormous spikes in call volumes,” explains Amir. “Other businesses are struggling to transition to remote work to keep their employees safe and stay afloat.

“By launching Cedar Contact at this critical time, we are able to create new business for our company, while helping the global community at large get the remote contact center support it desperately needs.”

Services include:

– Facilitating 24-hour emergency transitions to remote work

– Reselling Cloud Contact Center as a Service (CCaaS) technology

– Offering BPO solutions, including remote agent staffing

“We are an agile company,” adds Amir. “Because of our hard work, Cedar is posed to be stronger and more diversified as a result of COVID-19. We are already starting to see some light in the vast darkness of days, and I am confident that we will turn the corner faster than most organizations.”

Cedar Financial “Collects” Wishes for Kids in Need

It’s the season of giving, and while debt collectors are often portrayed as heartless or uncaring, the team at Cedar Financial is bucking that trend by Putting People First this Holiday Season and all year ‘round.

For the last three years running, employees at the agency’s Calabasas, CA headquarters have ended the year by giving back to the local community, helping children and families in need through 501(c)(3) nonprofit, Casa Pacifica.

Last year, Cedar sponsored a family of five, providing them with needed items, such as clothes and toiletries. This year, the agency elected to fulfill individual kids’ wishes, donating a total of 65 gifts for boys and girls, ages 8-18.

Cedar Financial’s CEO, Amir Erez, says, “This cause is dear to my heart. Every community needs a safe and prosperous home to protect children from neglect and abuse and provide them a transition place to a brighter future.  Casa Pacifica has been committed to that cause and is local to our community. We are happy to help.”

An Agency on a Mission

In line with its mission to build open, honest and positive relationships, Cedar Financial regularly participates in company-led community charity events.

Earlier in April 2019, the Cedar raised money for Strength United in the LA Big 5K Marathon.

“Since I don’t have the time to find a way to give back to the community, I appreciate that Cedar offers these types of events for employees to participate in,” says Rachel M., Operations.

Employees also pooled their resources to donate clothes and other needed items in November, when the family of an employee’s friend lost their home and all their possessions in the Simi Valley Easy Fire.

“It’s great to have a work family that cares,” says Kaitlin L., PR. “I know that if something happened to me, my coworkers would be there to help until I got back on my feet. And that means a lot.”

Making Wishes Come True

Wishes were posted up on the walls of the office for employees to choose from. Many employees took more than one wish. By the end of the drive, a pile of gifts was ready to be delivered. Items included basic toiletries, cosmetics, toys, electronics, clothes and gift cards.

“When I read some of these wishes, my heart broke a little,” says Anahi C. in HR. “Some of the things kids are asking for are basic necessity items.”

“Often times, we tend to take the basic things in life for granted,” adds Frank T., Collections. “Seeing some of the items being requested by the kids was tough to digest. I just hope I am giving a child something to smile about this holiday season.”

Teaching the Next Generation

Other employees used the experience of shopping for wishes as a way to teach the younger generation the value of giving back.

Thelma L., Collections, shares: “I went shopping with my niece for expensive makeup as her Christmas gift, and that motivated me to get Sophie something nice. When I told my niece about it, she said, ‘now I feel really thankful for what you bought me Tia,’ and she said ‘I will donate stuff this year to someone in need.’”

Cathy R., Collections, says, “It was fun! I had my daughter help me, they were the same age. It showed my daughter to be more grateful of what she has and what she is asking for Christmas.”

Spreading the Love

Everyone who participated was happy to be able to make a difference in a child’s life.

“I believe that there is no price tag on kindness because the happiness you bring to others when you perform an act of kindness is priceless,” says Alana J., Accounting.

Maria M., Collections, says, “I hope that they will smile and know that they are not alone; that they are loved and cared for.”

Anahi C., who helped organize the drive, appreciated the ability to help another family, knowing what a gift that can be to the parents as well as the children:

“I loved being able to give back a little of what my family has been blessed with. As a mom, I know that sometimes money is tight, especially during the holidays, and any help is appreciated. Looking forward to spreading the love again next year!”

Join the Cause – Donate Today!

Casa Pacifica Centers for Children and Families is a crisis-care and residential treatment facility for abused, neglected, or at-risk children in Ventura and Santa Barbara Counties. The agency is the largest non-profit provider of children’s mental health services in both counties and administers a number of community-based programs designed to strengthen families and keep children in their homes and communities.

To learn more or make a donation, visit:

To make more kids’ wishes come true, visit: Or call 1-877-445-WISH.

What You Need to Know About the CCPA (Even if You’re Not in CA)

The California Consumer Privacy Act (CCPA) takes effect January 1, 2020

What is the CCPA?

Introduced as Assembly Bill 375 and signed into law on June 28, 2018, the California Consumer Privacy Act (CCPA) provides consumers with groundbreaking new rights on the use of their personal information, effective January 1, 2020.

According to the Office of the Attorney General, the CCPA creates new consumer rights relating to the access to, deletion of, and sharing of personal information that is collected by businesses. It also requires the Attorney General to solicit broad public participation and adopt regulations to further the CCPA’s purposes.

A copy of the California Consumer Privacy Act Proposed Regulations and other related documents can be found at We encourage you to review this with your own legal counsel to determine how the CCPA might apply to your business.

Submit Your Comments on Proposed Regulations

As part of the regulatory process, the Attorney General’s Office is holding a public comment period on the proposed regulations, which will include four public hearings throughout the state in the first week of December 2019. The public comment period ends at 5 p.m. PST on December 6, 2019.

For more information how to how to attend the public hearings or submit public comments, see the October 10, 2019 press release from Attorney General Becerra.

What Rights Will California Consumers Have Under the CCPA?

This landmark piece of legislation gives California consumers:

  • The right to know and access personal information that is collected, used, shared or sold;
  • The right to delete personal information held by businesses and service providers;
  • The right to opt out of sale of personal information. Children under 16 must provide opt in consent, with a parent or guardian consenting for children under 13;
  • The right to non-discrimination in terms of price or service when a consumer exercises a privacy right under the CCPA.

What Qualifies as “Personal Information” Under the CCPA?

Personal information under the CCPA is defined broadly as:

“Information that identifies, relates to, describes, is capable of being associated with, or could reasonable be linked, directly or indirectly, with a particular California resident or household.”

This includes, but is not limited to:

  • Personal identifiers, such as a real name, alias, postal address, unique personal identifier, online identifier Internet Protocol address, email address, account name, social security number, driver’s license number, passport number, or other similar identifiers;
  • Commercial information, including records of personal property, products or services purchased, obtained, or considered, or other purchasing or consuming histories or tendencies;
  • Internet activity, including, but not limited to, browsing history, search history, and information regarding a consumer’s interaction with an Internet Web site, application, or advertisement;
  • Biometric information, such as fingerprints and retina scans;
  • Geolocation data;
  • Sensory data, such as audio, electronic, visual, thermal, olfactory, or similar information;
  • Professional or employment-related data;
  • Education information;
  • Characteristics of protected classifications under California or federal law, such as race, gender, religion, sex and so on;
  • Inferences drawn from any of the information identified in this subdivision to create a profile about a consumer reflecting the consumer’s preferences, characteristics, psychological trends, preferences, predispositions, behavior, attitudes, intelligence, abilities, and aptitudes.

How Much Will CCPA Compliance Cost?

Similar to the European Union’s General Data Protection Regulation (GDPR), the California Consumer Privacy Act of 2018 (CCPA) will have a huge impact on businesses in terms of compliance costs.

According to the Standardized Regulatory Impact Assessment (“the Assessment”) provided to the Attorney General’s office by Berkeley Economic Advising and Research, LLC, costs include:

  • Legal costs to interpret the law and apply it to business operations.
  • Operational costs, including labor across departments to facilitate compliance, ongoing training and record-keeping requirements.
  • Technological costs, including websites, forms and other systems for handling consumer requests and more.
  • Business costs from decisions such as renegotiating contracts and changing business models.

The Assessment assumes the following estimated initial compliance costs to businesses:

  • Small (<20 employees): $50,000
  • Medium (20-100 employees): $100,000
  • Medium/Large (100-500 employees): $450,000
  • Large (>500 employees): $2 million

Assuming about 75% of California businesses will be required to comply to the CCPA, the total estimated cost of initial compliance comes to a whopping $55 billion.

There is a silver lining to this compliance cost cloud: businesses that have already made changes for the GDPR should be able to leverage their existing compliance systems for the CCPA, lowering the overall cost.

However, since the CCPA differs from the GDPR, some changes (and costs) will still be required.

Contact us to learn more about Cedar Financial’s ongoing dedication to compliance and ethical, “People-First” debt collection as a member of ACA International.

Does the CCPA Apply to My Business?

Your business may be subject to the CCPA if it:

  • Has gross annual revenues over $25 million;
  • Buys, receives or sells the personal information of 50,000 or more consumers, households or devices;
  • Derives 50% or more of annual revenues from selling consumers’ personal information.

Businesses that handle more than 4 million consumers’ personal information may have additional obligations under the proposed draft regulations.

My Business Is Not in California, Do I Still Have to Comply?

Despite having “California” in its name, the CCPA will have wide implications outside of California as well, potentially affecting more than 500,000 U.S. businesses.

The CCPA applies to businesses that:

  1. Collect or sell the personal information of California residents
  2. Meet one or more of the three criteria (see above) under the CCPA.

Under the CCPA, the definition of California resident includes every individual who is in the state for other than a temporary or transitory purpose, or every individual who is domiciled in the state who is outside the state for a temporary or transitory purpose. The definition is quite broad, which means it appears to cover California residents while they are traveling in other states.

Even if your company is not organized under California law and has no physical presence in California, if you deal with the personal information of California residents, you’ll want to evaluate whether the law applies to you.

More Privacy Legislation Is on the Horizon

Even if the CCPA does not apply to your business now, you will want to closely monitor proposed privacy legislation in other states where you do business.

In 2019, over 43 states and Puerto Rico introduced over 300 bills and resolutions dealing with cybersecurity, indicating that 2020 could be a very active year for the enactment of consumer privacy laws. This issue is also on Congress’ mind at the federal level.

In effect, California will serve as a testing ground of sorts for future legislation in other states, so it is important to think about the potential implications for your business, monitor proposed laws and have a plan in place.

What Obligations Do Businesses Have Under the CCPA?

If your business falls under the scope of the CCPA, you will need to adjust to comply with the law, effective January 1, 2020.

Here are some of the new obligations businesses have under the CCPA (as proposed by draft regulations):

  • Provide notice to consumers at or before the time of data collection.
  • Create procedures to respond to consumer requests to opt out, access and delete their personal information.
  • Respond to requests within certain timeframes.
  • Verify the identity of consumers who make requests.
  • Disclose financial incentives offered in exchange for retention or sale of personal information; explain how the value of such information is calculated; detail how the incentive is permitted under the CCPA.
  • Maintain records of requests and responses for 24 months to demonstrate compliance.

To view the current Proposed Regulations and other related documents, visit

What Steps Can I Take to Comply With the CCPA?

Step 1: Determine Whether or Not Your Business Is Subject to the CCPA

It may seem obvious, but the first step to complying with the CCPA is to determine whether or not you need to.

Here are some questions you want to consider while you are reviewing with your legal counsel:

  • Do you collect, retain, buy or sell the personal information of California residents?
  • Is your gross annual revenue over $25 million?
  • Do you buy, receive or sell the personal information of 50,000 or more California consumers, households or devices?
  • Do you get 50% or more of annual revenue from selling consumer personal information?
  • Are you exempt from the CCPA?
  • If you’re not exempt, are you a business or service provider, as defined under the CCPA?

Step 2: Review Your Policies Regarding the Collection & Use of Consumer Personal Information

If you do fall under the CCPA, you’ll want to go through your current policies with a fine-tooth comb and determine what, if anything, you need to change. Work with your legal and compliance teams to come up with a game plan for implementing those changes. Decide whether your new policies will apply only to California consumers, or to all consumers and send out an updated privacy notice.

Even if you determine that you are not subject to the CCPA at this time, it is a good idea to re-evaluate your privacy policies now, as more privacy legislation is just around the corner, and you may be required to implement similar changes in the future.

Step 3: Update Your Data Inventory

To be compliant with the CCPA, companies will need to maintain a data inventory, or database to track all their data processing activities. Ensure that your data inventory has all the necessary information for compliance, including the ability to track consumer requests under the CCPA.

Step 4: Implement Security Updates

Under the CCPA, covered businesses must protect consumer personal information with “reasonable” security and consumers have the right to sue for data breaches, so now is the time to review your systems and address any high-risk areas that need attention.

It’s also a good idea to review data security policies with any third-party service providers who handle consumer information for your business.

Contact us today to learn more how Cedar Financial prioritizes data security for our clients and their customers.

Step 5: Review Contracts With Third Party Service Providers

Do you have third party service providers or vendors that you share consumer personal information with? Or are you a service provider handling a business’s consumer PI?

If so, you’ll want to work with your business partner to ensure you are both on the same page in terms of compliance to consumer requests and other requirements under the CCPA. You may need to revise or add an addendum to your contracts to ensure compliance.

As always, consult with your legal counsel to determine the best course of action.

How the Will the CCPA Impact Collections?

For covered businesses and service providers in the accounts receivable and collections space, the CCPA may create more questions than answers, which is why it is important to conduct a thorough review of this law with your legal experts, service providers and vendors.

Some questions you may want to go over include:

  • What policy and procedural changes do I need to make with my third-party collection agency to ensure CCPA compliance?
  • How does the CCPA apply to various types of collected data, such as skip traced info and asset searches?
  • What type of data is exempt from consumer deletion requests?
  • How should my third-party collection agency handle CCPA requests in relation to my business, and vice versa?
  • How do I respond to requests from non-California residents?
  • How can I effectively respond to CCPA requests used by debtors as a tactic to delay or avoid payment?

Still Have Questions After Reviewing With Your Legal Team? Talk to Us!

While the information provided on this website does not, and is not intended to, constitute legal advice, we welcome open discussion regarding the CCPA.

Call us at 800-804-3353 or fill out an Online Contact Form to start a conversation today.

“Your Success Is Our Success”

As a trusted business partner for our clients, Cedar Financial welcomes conversation about the laws and issues affecting your collections efforts, operations and cash flow. Our goal is to help you thrive and succeed, and we do this by providing the most comprehensive debt recovery services, tailored to your business’ needs.

Contact us today. Whether large or small, domestic or international, consumer or commercial, we have solutions to fit your needs.

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.

New CA Law Prohibits Withholding Transcripts as Debt Collection Tool

Educational Debt Collection Practices Act Goes Into Effect January 1, 2020

On October 4, 2019, California Governor Gavin Newsom signed into law Assembly Bill 1313, prohibiting postsecondary schools from withholding transcripts as a debt collection tool. The new law goes into effect January 1, 2020.   

AB 1313 adds new Title 1.6C.7, the “Educational Debt Collection Practices Act,” to Part 4 of Division 3 of the California Civil Code.   

Under the Act, schools will no longer be able to refuse, condition or otherwise restrict transcripts to students on the grounds that they owe a debt. Schools also cannot charge a higher fee for a transcript or provide less favorable treatment to transcript requests for students with outstanding debts.   

Under the Act, a “School” means any public or private postsecondary school, or any public or private entity, responsible for providing transcripts to current or former students of a school.

Impact on Educational Debt Collection in California 

Schools will have a greater challenge collecting on delinquent or default student debt accounts, as they will no longer be able to hold transcripts as collateral against payment.   

Loss of Student Accountability  

In most states, withholding transcripts is an accepted practice, with schools often including language about transcript withholding in their enrollment agreement, which the student must sign before accepting the loan and attending school.   

In the same way a bank might place a lien on a vehicle for an auto loan, schools hold transcripts to keep students accountable for the debt they owe.   

But unlike a bank, which can repossess a car upon failure to pay, schools cannot take back the knowledge and experience imparted to the student. That means that when a student fails to pay, the school goes unpaid for the services rendered, with no way to recover their assets.   

Without holds on their transcripts, students, current or former,  with past-due debts will have less reason to hold to their financial obligations.  

Consequences for California Schools  

Without a way to hold them accountable for nonpayment, schools may find that more borrowers default on their accounts. Schools may have to resort to more drastic, costly measures to get paid, which may include:  

  • Hiring debt collection agencies
  • Reporting the debt to the credit bureaus
  • Taking legal action against the borrower

In the meantime, cash flow may suffer, compounding existing funding problems in higher education institutions and making it difficult for schools to effectively render services to other students.  

Actions Schools Can Take 

1. Adjust Policies & Procedures for Compliance
The first thing schools should do is adjust their accounts receivable policies and procedures to stay compliant with the new law. As of January 1, 2020, “schools” (as defined by the Act) can no longer withhold or restrict transcripts to borrowers with unpaid debts. Schools will want to ensure the language in their enrollment agreements/student handbooks are adjusted accordingly. 

2. Improve Default Prevention and Management Programs
The best way to increase student accountability is to have a proactive plan in place to prevent delinquencies and defaults from occurring in the first place.   

Now may be a good time to review processes that encourage on-time payment of debts, before, during and after enrollment, including, but not limited to:  

  • Entrance counseling to promote greater financial literacy
  • Early identification and counseling for at-risk borrowers
  • Better interdepartmental communications
  • Dedicated staff for default prevention and retention
  • Exit counseling to re-emphasize consequences of defaulting
  • Maintaining contact with former students to improve repayment

Having trouble staying in contact with students regarding past-due payments?
Ask us about our Student Outreach Programto streamline your internal efforts. With our custom 1st party collection solutions, you can: 

  • Increase student retention and satisfaction
  • Decrease the number of default accounts
  • Easily roll over unpaid accounts to full collections

3. Hire an Experienced Educational Debt Collection Agency
No matter how hard schools work to prevent delinquencies and defaults, some will inevitably occur. Without the ability to withhold transcripts to encourage payment, schools may need to rely more heavily on collection agencies to resolve unpaid student accounts.   

Hiring a trusted, experienced educational debt collection agency can help schools boost payments, cut operational costs and increase overall cash flow.   

The right agency will have effective techniques for handling disputes, encouraging payment and navigating the unique challenges that schools and students face with their accounts, even without the leverage of transcript withholding.   

Affordable contingency rates can ensure that schools only pay for services when their accounts are recovered, minimizing collections costs and reducing funds lost to bad debts.  

Putting Students First
Cedar Financial’s educational clients enjoy some of the highest recovery rates in the industry.   

With over 28 years of experience, an extensive worldwide debt collection network and a focus on positive student relations, we can diplomatically resolve your accounts or disputes to recover lost money from students everywhere.   

Learn more here:  

Getting started is quick and easy - request a free quote today.   

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.

$267M Verdict Highlights TCPA Risks in Calling Skip Traced Numbers

$267M Verdict Highlights TCPA Risks in Calling Skip Traced Numbers with a Dialer

On September 9, 2019, the judge entered a final judgment in the TCPA case, McMillion v. Rash Curtis & Associates, 4:16-cv-03396 (N.D. Cal.) to the tune of a whopping $267 million.

The verdict, issued by the jury in June 2019, determined that over 534,000 calls using auto dialers and pre-recorded messages were made by the local California collection agency without consent of called parties. The case involved two main categories: 1) individuals called through skip traced numbers and 2) individuals who never had an account placed with the agency.

Historically, TCPA cases are notoriously difficult to certify, resulting in mountains of work sifting through account notes to verify consent. Most cases are denied certification.

But in this case, because of the use of skip traced numbers, the violation was certifiable by the judge, resulting in the monumental verdict that will likely render the 42-year-old debt collection agency bankrupt.

What is the TCPA?

The Telephone Consumer Protection Act of 1991 (TCPA) was signed into law as a response to a rise in unregulated and harassing telemarketing calls and faxes. It restricts telephone solicitations and the use of automatic telephone dialing systems, including pre-recorded messages, auto dialers, text messages and fax, without explicit customer consent.

Without consent, companies must follow Federal Communications Commission (FCC) solicitation rules and honor the Federal Trade Commission (FTC) National Do Not Call Registry, otherwise they may be sued.

How does this relate to the Debt Collection industry?

The FCC has determined that debt collection calls are not telemarketing calls. Therefore, auto dialers and pre-recorded calls may be used without consent to residential wired phones, where they do not include telemarketing messages; however, prior express consent must be acquired before calling wireless numbers with an auto dialer or pre-recorded message.

“Prior express consent must be acquired before

calling wireless numbers with an auto dialer.”

Creditors and collection agencies hoping to recover debt from customers must be careful to ensure that they have explicit consumer consent to call or text cell phones, and include opt-out language, otherwise they may be liable for TCPA violation.

The FCC does allow the use of cell numbers when provided to the creditor for use in normal business communications, such as in credit applications or agreements. However, consumers may revoke consent at any time.

Why was this case different?

In this case, the collection agency, Rash Curtis & Associates, was calling skip traced numbers (numbers found through investigation and search) and using an auto dialer with a pre-recorded message.

Since the numbers were found using skip tracing, rather than provided by the creditor as part of an agreement or application (which, if you recall, counts as consumer consent under the TCPA), the judge was able to certify that no prior express consent was given for these numbers, resulting in the devastating multi-million-dollar judgment.

THE TAKEAWAY FOR DEBT COLLECTORS: Skip traced numbers should be called manually and never through an auto dialer, as the TCPA risks are too high.

THE TAKEAWAY FOR BUSINESSES: It may be advisable to include a section for use of cell phones for collections efforts in your credit application or agreement, so that written consent is obtained from the start. You can then provide wireless numbers to your collection agency to be used in calling campaigns, without the TCPA risk.

Compliance is our top priority

At Cedar Financial, we take careful steps to ensure strict compliance with all laws and regulations – state, national and international – at all times. A member of ACA International, we adhere to the highest standards possible, maintaining a code of ethics for fair, but firm collections practices that put your customers first.

In order to stay TCPA compliant, we review accounts when they are first placed with us to see if there is a written agreement (application, agreement, etc) with the debtor that serves as sufficient consent to place the wireless number on an auto dialer. If no agreement exists, we put measures in place to ensure the number is not called using an ATDS without express prior consent of the called party. In addition, we never call skip traced numbers or individuals who never had an account placed with us using an auto dialer or pre-recorded message.

We want to protect your interests and those of your customers in everything we do. To learn more about our compliance policies and practices, contact us today.

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.

California SB 616 Makes It Harder for Collectors to Enforce Judgments

California SB 616 Passes, Making It Harder for Debt Collectors to Enforce Judgments

On September 10, 2019, California bill SB 616 was passed 48 to 23, making it more difficult for debt collectors to enforce judgments in the state.

Automatic exemption for bank levies

The bill, initially introduced February 2019 by Senator Bob Wieckowski (D-Fremont), creates an automatic exemption for the first $1,724 in a consumer’s bank account for bank levies. The result: collectors may have a harder time collecting on judgments.

RMAi, Encore and the California Collectors Associations expressed disappointment following their failed attempt to block CA SB 616 from passing. Encore stated they thought they had the numbers leading up to the vote.

The provisions of the bill shall go into effect September 1, 2020.

Recover more accounts, pre-legal

With an increasing number of proposed laws that favor consumers over creditors, it’s more important than ever to focus on ethical, amicable collection efforts.

At Cedar Financial, we believe communication is key to success. Our courteous, knowledgeable team of collectors is fair, but firm, using top negotiation techniques to find a fitting solution for your unresolved accounts.

To learn more about our Consumer Debt Collection services, visit or contact us today.

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.

What the Small Business Reorganization Act of 2019 Means for Creditors

Small Business Reorganization Act of 2019 “Reorganizes” Ch. 11 Bankruptcy Proceedings in Favor of Debtors

On August 23, 2019, the Small Business Reorganization Act of 2019 (SBRA) was signed into law, creating “Subchapter V” in Chapter 11 of the Bankruptcy Code as part of an effort to streamline the structuring process for small businesses (defined as those whose total noncontingent liquidated secured and unsecured debts do not exceed $2,725,625). The new law will go into effect February 19, 2020.

What does this mean for creditors?

Harder to contest Chapter 11 bankruptcy cases

The SBRA makes it more difficult for creditors to contest small business Chapter 11 cases. It favors small business debtors by eliminating the Absolute Priority Rule (APR), which previously required full payment to unsecured creditors for debtors to retain ownership of assets.

The APR will continue to apply for secured creditors.

While this new law only applies to businesses whose debts are less than $2,725,625, debtor businesses may qualify by paying down debts at negotiated discounts, since contingent and unliquidated debts are not calculated in the total.

What’s changed?

Before SBRA:

Previously, debtors would be unable to retain ownership of their business without paying creditors unless: 1) the class of creditors voted to accept the plan, or 2) the equity holder paid a “new value” to the debtor business in a substantial and essential amount.

Because debtors were not able to pay a large amount upfront in cash, they would often attempt to negotiate to buy back ownership, offering to provide new value in payments over several years. Thanks to the immediacy of the APR, these attempts would mostly be unsuccessful, with the result that over 90% of Chapter 11 cases would transfer to Chapter 7 liquidation proceedings instead.

After SBRA:

Without the APR in place, debtors can retain ownership of its assets without paying unsecured creditors in full, which means they are more likely to be successful in reorganizing and creditors are less likely to receive substantial payment.

The silver lining: fewer preference lawsuits

It’s not all bad news for creditors. The SBRA also makes changes to Preference Laws that favor creditors by increasing the threshold and due diligence requirements for preference lawsuits.

Under current law, trustees and debtors in possession can file lawsuits to recover preferential transfers made in the 90 days before the bankruptcy was filed, or one year, for insiders. If the amount was less than $13,650, then they would have to file a lawsuit to recover the transfer in the federal district where the defendant resides, rather than the bankruptcy case district.

Under SBRA, the threshold is raised from $13,650 to $25,000 for non-insider defendants, and the trustee or debtor in possession is required to exercise reasonable due diligence, taking into account “a party’s known or reasonably knowable affirmative defenses.”

Prohibitive costs and logistics generally prevent filing of preference suits outside of the bankruptcy case district, so raising the threshold effectively protects most transfers $25,000 and under from recovery. The new due diligence requirement will also help to reduce the number of preference lawsuits.

Actions creditors can take

In light of the new law, creditors and their attorneys, when settling lawsuits with businesses, should:

  • Insist on liens upon assets with equity, including during contract negotiations;
  • Insist upon entry of a judgment – or, at the very least, an admission of liability – exceeding $2,725,625 in order to disqualify the business from Subchapter V;
  • Obtain admissions of wrongdoing in the settlement agreement, since the same debts that are non-dischargeable under other chapters of the Bankruptcy Code remain so under Subchapter V;
  • Lean more towards larger transactions (exceeding $2,725,625) instead of smaller ones;
  • Focus on anything that may create a lien or property interest, such as a writ of attachment, lis pendens, or judgment lien, as these will increase the chance of a substantial payment.

In order to find more successful outcomes under the new Subchapter V, creditors should be more selective about extending credit, insist on obtaining liens wherever possible and monitor the assets that secure the liens on a regular basis.

Make More Informed Decisions with Cedar Financial

Business Credit Reporting

Cedar Financial offers Global Business Credit Reporting, Skip Tracing and Investigative Services to help you make more informed decisions about your business transactions.

In light of SBRA, knowing your customers is more important than ever to reduce potential credit risks. You don’t want to be left in the dust if your trusted business companion decides to file for bankruptcy.

Get the financial knowledge you need to put your best foot forward and maximize your profits. Ask us for a sample credit investigation report today.

The Best Legal Representation, Anywhere

When you place your claims with Cedar Financial, we do everything we can to resolve your accounts amicably, without litigation. But in the event, it comes to that, you’re in good hands – no need to hire a separate commercial debt collection lawyer.

Our clients receive access to full legal support through our in-house counsel and vetted creditor’s rights attorney network for the most trusted legal representation around the globe.

We can evaluate your accounts, review collectible assets and recommend the best course of action for potential legal proceedings. Every case receives the same close monitoring, management and follow-up as our in-house collections accounts, so you don’t have to deal with anyone else.

For more information about our services, contact our representatives at 800-804-3353.

*The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.

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