I get asked a lot by
clients and colleagues about consent to communicate with consumers in
collections, especially by email and SMS.
Understandably, there’s a lot of confusion about that, especially with electronic
communication methods like SMS or email.
In Canada, there are a couple guidelines that dictate what can and can’t
be done.
What Do The
Collection Acts Say?
Well, nowhere in the
various provincial or territorial acts does it say that a collection agency has
to ask permission to communicate with consumers. Now, most of the legislation is built on
foundations written in the 1970’s, so there’s a lot in there about telephone,
letter mail, and occasionally even telegram, but across the board, the various acts
talk about how often you can attempt contact, what hours and days you can
attempt contact, and what can be said in the contact, and to whom you may disclose
information, but doesn’t get into communication methods outside of telephone or
mail.
Now, more recent amendments
to the Acts in Ontario, British Columbia and Nova Scotia get into sending
collection notices by email so it’s implied that email is fine for other
communications.
The one thing that is
clear in the Acts are options for consumers to opt-out of communications that
cost them money (although the days of pay per text or cell phone minutes are
99% gone), or consumers to opt-out of any communication other than letter mail,
if they send their communication request in writing – it used to be registered
mail, but now it’s any sort of trackable communication such as fax, email, etc.
So, creditors can pass
information on to their collection agency and the agency is allowed to use all
methods of communication, until told otherwise. Nowhere in any Act does it say a consumer needs to ask permission to send an SMS, email, or make a telephone call.
So, unless a consumer
indicates otherwise, consent isn’t needed to sent an SMS or an email.
What Does The Office
of the Privacy Commissioner Say?
The various findings
of the Office of the Privacy Commissioner have a few references to collection
agencies, mostly when collection agents have spoken to consumer’s employers,
faxed items, or generally broadcast information regarding a debt to someone
other than the consumer – that’s really covered under the collection acts,
nothing groundbreaking here.
There are a few
findings where it was questioned whether a creditor could pass information to
the collection agency – and the general stance is that if that information directly
impacted the collection agency’s role of collecting a debt, it was fine.
In general terms for
all businesses, the Privacy Commissioner does have rules about a company having
reasonable precautions to validate the identity of a consumer before disclosing
personal information. They don’t specify
how many points of information or needed or what the policy should be, but a
collection agency must have one. So, for
example, if you call Dave Smith at the telephone number provided by the
creditor, ask for Dave Smith, and get a ‘yes, that’s me’ you’ve technically
confirmed the consumer’s identity by two pieces of information – name and
telephone number. That would be sufficient
as far as a policy goes. Now, if you are
looking for Dave Smith and start pulling names out of Canada411, you’re going
to need another way to validate the identity of the consumer you are calling
(because they are ALL Dave Smith, but not necessarily the right one, and when
you call, you aren’t validating by two pieces of information like the first
example).
The same policy should
be applied to email and SMS. This might
require some back and forth, but before you get into details of the debt you
should make sure you know who you are talking to.
What Does the
Canada Anti-Spam Legislation (CASL) Say?
Well, CASL is mostly
focused on companies spamming people with emails trying to solicit them, but
there’s a very important exception for ‘enforcement of a right, or pursuit of
enforcement of a right’ so for contacting debtors who owe money, consent is not
required.
https://www.fightspam.gc.ca/eic/site/030.nsf/eng/home
What Other Considerations
For Communication Should Be Made?
This is where
you can go into the weeds.
What can you
disclose to whom when you have a judgment, outside of filing a
garnishment? What happens when the
consumer has provided the creditor an email address owned by their place of
employment? All good questions, and no
black and white answers.
The important
thing is to approach these processes thoughtfully and use discretion.
Conclusion
I am a huge fan of
modern communication channels, but I get twitchy when folks start talking about
just firing out payment links to a consumer without talking to them, or
reminder for payment SMS messages – that works fine in a direct creditor to
consumer world, but collection agencies that don’t have an established
relationship with the consumer are treading on unproven ground here. If we haven't spoken to the consumer, we don't know we have the right party, so it's not an issue of consent, it's an issue of validation.
Sending an email or an SMS to a consumer with information they gave the creditor is certainly fine, as long as that communication is 'call me' or 'is this the right party before we go any further?'.
The important thing is
to remember that the collection legislation is paramount, and it has several
warnings about disclosing information to someone other than the consumer. While we can’t stop someone from sharing a
personal email account, opening someone else’s mail, or pretending to be the
consumer in question, reasonable processes need to exist to show that the
collection agency is using personal information responsibly.
That’s my two cents
and rant for this week – got some questions or ideas? I really do appreciate my colleagues reaching
out to discuss these topics, it makes us all better.
Thanks kindly,
Blair
DeMarco-Wettlaufer
KINGSTON Data &
Credit
Cambridge, Ontario
226-946-1730
blair@receivableaccounts.com
Always clear, concise and informative!
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