CFPB Releases Reg F Guidance

On July 27, 2022, the Consumer Financial Protection Bureau (CFPB) provided additional Reg F guidance as a series of Frequently Asked Questions (FAQs) sorted by topic. The FAQs cover the following subjects:

• Limited-Content Messages
• Telephone Call Frequency
• Telephone Call Frequency: Presumptions
• Telephone Call Frequency: Excluded Calls
• Telephone Call Frequency: Rebutting the Presumptions
• Validation Information
• Validation Information: Residential Mortgage Debt
• Prohibitions on Third-Party Communications
• Electronic Communication
• Electronic Communication: Opt-out Notice
• Unusual or Inconvenient Times or Places

There are 51 total FAQs; however, here are some of the highlights:

Limited Content Messages

• Including information that is required by state law but not included in the content that the CFPB listed as required or optional in Regulation F will cause the message to lose its status as a limited content message.  (Limited Content Message FAQ #3).
  
  
• A partial message left for someone is not a limited content message, even if the partial message was caused by a dropped call (Limited Content Message FAQ #4).
  
  
• Limited content messages may be prerecorded, though the Telephone Consumer Practices Act (TCPA) still applies. (Limited Content Message FAQ #5).
  
  
• Zortman messages are not limited content messages, and there is nothing in Reg F that addresses using these messages.  See Zortman v. J.C. Christensen & Assocs., Inc., 870 F. Supp. 2d 694 (D. Minn. 2012). (Limited Content Message FAQs #6-7).

Telephone Call Frequency

• Reg F does not have a specific limit or cap on the frequency of telephone calls. Instead, Reg F establishes presumptions based on call and conversation frequency. (Telephone call Frequency FAQ #1). Details regarding these presumptions are listed under Telephone Call Frequency: Presumptions FAQ #1.
  
  
• Incoming telephone calls from a consumer do not count toward the call frequency presumption (7 calls in 7 days), but they do count toward the conversation frequency presumption (no calls within 7 days of a conversation without consent). (Telephone call Frequency: Presumptions FAQ #2). 
  
  
• A return call to the consumer in response to a debt settlement inquiry counts toward the call frequency presumption unless the consumer provided direct consent for the return call. (Telephone call Frequency FAQ: Excluded calls FAQ #5).
  
  
• Neither payment reminder calls nor calls returned in response to a consumer’s inquiry are exempt from the call frequency presumption or the conversation frequency presumption. (Telephone call Frequency FAQ: Rebutting the Presumptions FAQ #3- 4)

Electronic Communication

• Reasonable and simple methods for opt-outs include hyperlinks and allowing a consumer to respond with the word, stop. If opt-out instructions are readily noticeable and legible to consumers, the instructions constitute a clear and conspicuous statement. (Electronic Communication: Opt-out Notice FAQ #3).
  
  
• A debt collector must honor a consumer's request to opt out even if the consumer does not comply with the debt collector’s opt-out instructions. (Electronic Communication: Opt-out Notice FAQ #4).
  
  
• An autogenerated electronic communication that is sent at an unusual or inconvenient time violates the prohibition on communicating at inconvenient times unless it is in response to a consumer’s action. (Unusual or Inconvenient Times or Places FAQ # 4; FAQ #6).

The complete set of FAQs can be found here. 

insideARM Perspective

The CFPB did not provide any new information in these FAQs. Though the information may be more organized and perhaps more palatable than it appeared in Reg F and its comments, all of this information is in there in one form or another. That said, these FAQs serve as a good checkpoint for ARM entities to take stock of their risk tolerance thresholds and audit their Reg F policies and procedures. 

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The CFPB dodged a number of questions in the FAQs responding with either “not addressed” or “it depends." These non-committal responses leave a gray area where ARM entities are left guessing what is actually permitted. Sometimes it makes sense to operate in the gray area, where actions may be considered "defensible," rather than "safe".  It's not wrong for ARM entities to create policies and procedures that are defensible, but any entity doing so should be simultaneously preparing their planned defense, and recognize that "defensible" literally means mounting a legal defense (i.e. this will cost you money).

As for the auditing of policies and procedures, these FAQs cover a number of areas and the language is less verbose than that included in Reg F. It never hurts to compare additional info from the CFPB to existing policies and procedures to make sure everything is covered.