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4 Steps To Successfully Survive A CFPB Investigation Or Examination

4 Steps To Successfully Survive A CFPB Investigation Or Examination
On April 9, the CFPB ordered Bank of America to pay about $727 million for illegal credit card practices. The largest enforcement action taken by the CFPB so far. In the debt collection industry, investigation by regulators and subsequent monetary penalties are not the only cost of noncompliance. It also leads to litigations and lawsuits, brand damage, loss of customers, diminishment of business, and bad customer experience.

So, how do you create a culture of compliance in your company that will withstand CFPB scrutiny?

With the ever moving target of compliance, it is necessary to take these preventive steps:

1. Effective Compliance Management System and Training. It all starts at the top and works down from there. The culture of compliance must be established at the top levels of the company. With this approach, build your Compliance Management System and training programs, making sure that your organization learns its compliance responsibilities and that employees understand these responsibilities. Also, ensure that requirements are incorporated into business processes. Always make sure that all employees know the rules and what types of practices are abusive with periodic training.


2. Document, document, document. Make sure that you document all information that might be requested by the CFPB during an examination: Management Information and Business Structure, Compliance Management System, Policies and Procedures, Training, Audit/Internal Reviews/Quality Assurance, Consumer Acquisition, Grant Policies, Details regarding fair share and related grant money, Documentation related to amount of debt, type, fees collected from consume, IT/Data Infrastructure, Vendor Management.


3. Assessment by an outside auditor. The CFPB recommends and looks for this outside review when they come in for their investigation. Audit consumer interactions and documentation to get a true picture of your compliance culture. It’s not enough to have Standard Operating Procedures and then have everybody sign off on them. You have to make sure that what you have in your SOPs is being screened and enforced by reviewing operations to ensure that responsibilities are carried out and requirements are met.


4. Take corrective action and update materials as necessary. Review the audit report and make any necessary adjustments to your Compliance Management System, training programs, or documentation procedures. Also, if you find a collector that is breaking the law or not complying with your procedures, and if coaching or other disciplinary actions do not repair the situation, you owe it to your business to fire the employee. Corrective action is vital to maintain an effective Compliance Management System.


At CCSI, we understand your compliance responsibilities and devote a great amount of time to training and updating our call center operations team with the most recent regulations.


Click here to read more about our agent training and development.