ACA and DBA Cook Up Milquetoast Guidelines for Debt Buyers

The two most influential trade groups in the accounts receivable management industry announced recently the adoption of a set of guidelines for members who engage in the purchase of consumer debt.

ACA International and DBA International jointly released a Statement of Principles and Guidelines for the Sale and Purchase of Consumer Debt. The document outlines “a set of core principles that represent the highest level of business, legal and professional conduct.”

“We strongly encourage each of our members to adopt these guidelines and apply them daily in the management of their businesses,” said Michael Bendickson, President of DBA International, in a press release announcing the guidelines. “DBA worked hand in hand with ACA International’s Asset Buyer Division to develop these standards. Our organizations’ collaboration demonstrates how important it is for our industry to share a common goal for unified business practices.”

Regulators at the state and federal level have increasingly turned their attention to debt buyers and their practices after a recent wave of negative press attention.

But the guidelines jointly issued by the ACA and DBA hardly address many of the root causes in the eyes of regulators and consumer advocates. They also do not make very stringent recommendations for behavior modification and generally include practices that any business should follow.

For example, the initial principles spelled out in the document read: “Abide by the ACA International Code of Ethics and Code of Operations; Maintain a high standard of professional conduct; and Maintain a good reputation in the community.”

Other principles exhort members to “Comply with all local, state and federal laws and regulations governing the industry,” and to “Act honorably, ethically and professionally in all transactions.”

The entire document can be read at http://www.acainternational.org/files.aspx?p=/images/88/20110217statementofguidingprinciples-finalv2_0.pdf.

Although it’s entirely commendable that the groups teamed up to put some guidelines down on paper, there is no mention of or remedy for any of the hot button issues facing the debt purchasing industry that will be addressed by regulators soon, such as the exchange of out of statute debt, service of process, debt validation documentation, or the use of the court system. Further, there are no threats or promises of any action against members who do not adopt the guidelines.

The lack of substance of the principles is startling to me. It’s like a CDL instructor reminding his truck driving students to drive on the right side of the road and stop at red lights.

Am I missing something here? That’s entirely possible. Did I read this incorrectly? If not, what principles should have been spelled out by the two groups?