Articles by deBanked Staff

FCC Closes the Lead Generator Loophole, Are You Compliant?

Coming soon to a lead provider near you, new regulations that require “one-to-one” consent. The loophole that deBanked warned about last November is now officially scheduled to close on March 26. To revisit the heart of what’s changing, we republish the following:

“Lead-generated communications are a large percentage of unwanted calls and texts and often rely on flimsy claims of consent to bombard consumers with unwanted robocalls and robotexts,” the FCC said. As such they’re now requiring one-to-one consent.

First, the one-to-one consent must come after a clear and conspicuous disclosure to the consenting consumer that they will get robotexts and/or robocalls from the seller. “Clear and conspicuous” means notice that would be apparent to a reasonable consumer. In addition, if compliance with the federal Electronic Signatures in Global and National Commerce Act (the E-Sign Act) is required for the consumer’s signature, then all the elements of ESign must be present.”

Second, we adopt our proposal that robotexts and robocalls that result from consumer consent obtained on comparison shopping websites must be logically and topically related to that website. Thus, for example, a consumer giving consent on a car loan comparison shopping website does not consent to get robotexts or robocalls about loan consolidation.

Fortunately, the FCC spells out an example of what might be acceptable as one-to-one consent for a lead generator.

For instance, the website may offer a consumer a check box list that allows the consumer to specifically choose each individual seller that they wish to hear from. Alternatively, the comparison shopping website may offer the consumer a clickthrough link to a specific business so that the business itself may gather express written consent from the consumer directly. Our rule does not prohibit comparison shopping websites from obtaining leads through valid consent and provides multiple opportunities for responsible comparison shopping websites to obtain leads for potential callers.”

The FCC has since published the new rules in the Federal Register. There are two components of it that have a delayed effective date, one being July 24, 2024 and the other being January 27, 2025. The rest goes into effect this March 26, however.

For questions about whether or not this will affect you, please consult with an attorney.

AMEX: ‘We’re not seeing small businesses spend more’

“We’re not seeing existing small businesses spend more than they spent the year before,” said Stephen Squeri, CEO of American Express, “And that’s not an American Express phenomenon, that is an industry phenomenon.”

Squeri, who was speaking on the company’s Q4 earnings call, was answering questions about what they’re seeing with small business customers. Although spending in particular is not increasing, they still want loans and cards. “As far as card acquisition within small businesses, that still remains strong,” he said. “As far as small businesses, looking at our platform, and looking at our loans, and so forth, that remains strong. And the credit quality remains strong.”

The trend is not concerning to American Express, who explained that write-off and delinquency levels were actually lower now than they were before the pandemic, despite ticking up just a little bit higher.

Financial Service Associations Urge Legislation on IRS Income Verification

The IRS doesn’t want financial service companies to be able to verify the income of customers, at least not through official channels like the Income Verification Express Services (IVES) system. On January 2 and 3, the IRS announced it would only allow IVES transcripts to be made available “to mortgage lending firms for the sole purpose of obtaining a mortgage on residential or commercial real property (land and buildings).” Government agencies will also not be allowed to use IVES.

“The IRS is implementing the provisions of the Taxpayer First Act (P. Law 116-25) with increased privacy and security requirements for access to confidential tax information,” it announced. “If tax transcript information is required by your firm for other than securing a mortgage, we recommend requesting it directly from the taxpayer.”

But relying on getting the information directly from the taxpayer defeats the whole purpose in more ways than one, many financial service trade associations say. On Wednesday, a letter jointly signed by the American Bankers Association, America’s Credit Unions, American Fintech Council, Consumer Data Industry Association, Electronic Transactions Association, Financial Technology Association, Innovative Lending Platform Association, Independent Community Bankers Association, Mortgage Bankers Association, Responsible Business Lending Coalition, and Small Business Finance Association urged senior ranking members of Congress to pass H.R. 3335. Dubbed the IRS eIVES Modernization and Anti-Fraud Act, it would “ensure the IRS follows the original intent of Congress to modernize the system and prevent disruptions to the consumer and commercial lending industries.”

You can view the letter here.

Seven States Reintroduce Commercial Financing Bills

They’re BACCKKKK. The following states legislatures all have new bills in front of them for consideration.

North Carolina – Small Business Truth in Financing Act

Kansas – The commercial financing disclosure Act

Missouri – Commercial Financing Disclosure Law

New Jersey – An Act concerning commercial financing

Illinois – Small Business Truth in Lending Act

California – Commercial Financing Bill

New York – An Act to amend the banking law and the administrative code of the city of New York, in relation to regulating commercial finance licensing