Compliance Blog

Feb 11, 2022
Categories: Operations

Texts and Bona Fide Errors Under Regulation F

Last month, we blogged about emails and bona fide errors under Regulation F. Regulation F provides similar treatment for text messages and bona fide errors. Under section 813(c) of the Fair Debt Collection Practices Act (FDCPA), debt collectors can be protected from liability for sending a text message to a third party in connection with the collection of a debt, as prohibited by the FDCPA and Regulation F, if they demonstrate that the violation was unintentional “and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error.” And section 1006.6(d)(5) describes the kinds of procedures that are reasonably adapted to avoid a bona fide error in communicating with a third party by text message.

The rules regarding when cell numbers can be used to text consumers in connection with the collection of a debt without losing the bona fide error protections in section 813(c) of the FDCPA are much simpler than the rules for email communications. Section 1006.6(d)(5) provides debt collectors with two different ways to show that they have “procedures that are reasonably adapted” to prevent prohibited disclosures to third parties by text message. First, the rule permits a debt collector to send consumers texts to a particular number if the consumer sent the debt collector texts from that number to communicate about the debt by text with the debt collector, the consumer did not opt out of receiving text messages at that number and either the consumer’s text was sent within the past 60 days or the debt collector confirmed that the number had not been reassigned “using a complete and accurate database,” like the reassigned numbers database, within the past 60 days. The rule also permits a debt collector to send a consumer text messages if the consumer directly provides the debt collector with prior consent to receive texts at a particular number, consent has not been revoked and the prior consent was either provided or renewed within the past 60 days or the debt collector confirmed that the number had not been reassigned within the past 60 days.

Another thing to remember when texting members is the Telephone Consumer Protection Act (TCPA). If a debt collector is texting members and using technology that is covered by the TCPA (e.g., an autodialer), the TCPA may require having prior express consent in order to make an informational text like a debt collection text to a member. For more guidance on the TCPA, please see this Compliance Monitor article. In addition to the TCPA, there may be other considerations like industry guidelines or carrier restrictions, too.

For more questions about the debt collection rule, you can look to the CFPB’s small entity compliance guide.

About the Author

David Park, NCCO, Senior Regulatory Compliance Counsel, NAFCU

David joined NAFCU in September 2018.  As part of the Regulatory Compliance Team, he provides daily compliance assistance to member credit unions on a variety of topics. 
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