WASHINGTON—CUNA and NAFCU are urging the House Energy and Commerce Subcommittee to make changes to the Telephone Consumer Protection Act (TCPA), a regulation the trade groups feel prevents CUs from communicating with members about pertinent account information.
Both trade groups have sent letters to the HECS in advance of the subcommittee’s hearing today on the TCPA.
The TCPA is an “antiquated approach to communications regulations,” wrote NAFCU's VP of legislative affairs, Brad Thaler, who specifically pointed out that the TCPA does not take into account the impact on membership-based institutions or the compliance burden that regulations place on small businesses.
“The intent of the TCPA is to ensure that all egregious offenders are grouped together,” he wrote to subcommittee Chairman Greg Walden (R-OR) and Ranking Member Anna Eshoo (D-CA). “However, such grouping has inadvertently included good actors as well.”
Thaler said NAFCU applauds Walden and Eshoo for their efforts “to present a more nuanced approach to updating the TCPA that takes into account the needs of membership-based businesses.”
He also noted that while the association appreciates the Federal Communications Commission’s initiatives to clarify and modernize the TCPA, it “believes that the FCC has hindered consumers’ ability to receive important notifications and timely updates about financial developments that have the potential to impact their existing accounts, on both mobile and residential phone lines.”
NAFCU said it has long urged the FCC to reconsider its action relative to credit unions. The same concerns were also raised in the report language accompanying the fiscal 2017 financial services and general government appropriations bill in the House. Thaler also pointed to several letters from NAFCU to the FCC on this issue.
CUNA stated that it is imperative that Congress take action to eliminate the negative consequences of last year’s changes to the TCPA. CUNA said its concerns arise from a July 2015 Federal Communications Commission omnibus declaratory ruling and order for the TCPA, which it believes is problematic and has impacted credit unions’ ability to communicate with members about pertinent account information.
“We support the concept of preserving consumers’ rights to privacy on their cell phones and protecting financial information; however, the FCC's Order goes far beyond the scope or purpose of the TCPA, which was enacted in 1991 when a cell phone was considered a luxury item and smartphones were still years away from production,” CUNA wrote.
CUNA’s specific concerns include:
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The order’s immediate adverse impact, which has caused disarray and exposed credit unions to frivolous litigation. The ruling created obstacles to credit unions’ ability to contact members, particularly small credit unions, which CUNA believes is contrary to congressional intent;
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The financial institutions exemption provides minimal relief, as the conditions that must be met are difficult, if not impossible to meet. For example, exempted calls must be free-to-end-user calls, which puts credit unions in the position of ensuring notifications do not count against a member’s minutes or text plan;
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A problematic definition of what is considered an “autodialer.” Credit unions are not able to interpret the FCC’s order to determine whether the calling system they use qualifies them to be subject to the TCPA;
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Ambiguity about how consumers can revoke consent for autodialed calls, which means credit unions theoretically have to monitor all communications in every manner between every employee and every member;
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An increase possibility of liability under the TCPA when calling a reassigned number, since the one-call safe harbor does not account for the dozens of reasons it may not be possible to connect with the new holder of the number in one attempt; and
- Conflicting statements from other regulators, including the Consumer Financial Protection Bureau (CFPB). The CFPB has released statements espousing the importance of getting information on mobile devices, including online and through text messages, making it difficult for credit unions to make compliance decisions concerning communications efforts.
CUNA and NAFCU also submitted a joint letter for the hearing’s record Wednesday, signed by a number of other financial trade organizations. The joint letter highlights similar concerns to those raised by CUNA and NAFCU, and calls for Congress to reform the TCPA by imposing a damages cap and mandating the establishment of a database of reassigned numbers.