Expert Roundtable: Mid-Sized Agency Leaders

With most of the attention going to the industry’s largest players, CollectionIndustry.com wanted to give the mid-sized companies an opportunity to discuss the issues affecting their business and get their take on the direction of the industry and the role mid-sized agencies play in it.

We assembled a panel of leaders of mid-sized agencies from around the country. Included in the discussion were Adam Cohen of Phillips & Cohen Associates, Ltd., Robert Dunham with Receivables Management Solutions, Inc., Jeff Freedman of MRS Associates, Inc., John Kotula from Northeast Credit & Collections, David Stein of Malcolm S. Gerald & Associates, Harry A. Strausser from Remit Corporation, and Mike Sutherland with American Collections Enterprise, Inc.

Moderating the discussion was Brian Greenberg, Managing Director of Kaulkin Ginsberg.

The panel discussion is also available for download in PDF format. Download PDF (11 pages, 42kb)

BRIAN GREENBERG: What’s the biggest challenge facing your business today?

JOHN KOTULA: Well, I think the biggest challenge facing our business [Northeast Credit & Collections] is pretty much the same as has always been in the industry: staffing, from both a collective standpoint and from quality in management. We have a very specific industry and we have a very unique workforce that we need to supply in order to get our job done. There are so many agencies that people can pick from. So, I think it comes down to staffing and the right mix, full time, part time and quality of management.

JEFF FREEDMAN: Not only is hiring and staffing important but also the back end of it, retention. Obviously between all the costs of advertising and screening and training that goes along with hiring, retention is a huge challenge. I know for us [MRS Associates, Inc.] it definitely is.

DAVID STEIN: The biggest concern for us [Malcolm S. Gerald & Associates] is really manpower. It is employee-related issues all together, including complaints and those types of things. Does anyone else beside me occasionally come across labor related issues and has anyone had any good success in that area, other than having insurance and doing the best you can for employees. Anyone else coming across issues in that area?

ROBERT DUNHAM: When you say issues, are you saying issues regarding the collectors’ attitude about the job and the requirements of the job and kind of resisting it or challenging it from against the laws or what?

STEIN: Well, not challenging the laws, things like labor-related complaints, EEOC complaints, racially discriminatory complaints and things along those lines. It seems to me that those issues have come up more in the last three to five years than I ever saw before, matter of fact, before the last three or five years, I never saw those type of things. And it seems like the EEOC and the State Departments that regulate these things have become so pro-employee that they are making it difficult for employers to manage employees the way that we need to.

FREEDMAN: David (Stein), do you think it is that or do you think it is maybe a combination also of the fact that your company has probably just gotten larger, so there is just a bigger target on you. People are just more aware, you know what I mean.

STEIN: Oh, I am quite sure that is a pretty good portion of it. It just seems like that when I talk to my labor relations attorneys, they say that what has really changed is the laws, not even the laws, the regulatory bodies are so pro-employee now.

HARRY STRAUSSER: We [Remit Corporation] have not had any real trouble in that area, we are probably the smaller agency in the mix here and I think it also depends on some of the diversity of our respective work forces. We don’t have a real diverse population in my rural community but for some of you folks in more metropolitan areas, I am sure this becomes much more pressing.

ADAM COHEN: As we [Phillips & Cohen Associates, Ltd.] have grown into a few areas that have more of a demographic mix, one thing that we have tried to do is concentrate on all of our documentation and all of our paperwork and training and things like that. It is a litigious society we live in and people have many different outlets to try to use that to their advantage. You are not going to be able to stop people from making the complaints and you are not going to be able to stop the governing boards from investigating them, whether it has not merit not. That is what they are paid to do, they are going to do it whether there is any merit in it all. We’ve had very little experience with it but in the experiences that we’ve had, as long as you have any competent level of documentation that is going to prevent any real damage to you later. The other thing is, I always think that the insurance companies drive this behavior. Every time our insurance people come out, all they want to do is offer us different umbrella policies for all the different harassment suits that may come up next.

STEIN: And another thing about the insurance companies: it seems like when they do get involved, they are very quick to settle which is not necessarily the best thing for the company either.

COHEN: Well, that’s another thing too. We are kind of notorious for the opposite; we don’t settle those kinds of things. You have to be really careful of that because if you start to settle, you are going to become a target.

DUNHAM: The one thing that I would say and it kind touches on what Adam (Cohen) said, is the ever-increasing creditor-consumer rights attorneys on the FDCPA side. That, combined with the proliferation of information on the Internet on the consumer side, is sparking these frivolous FDCPA-violation lawsuits. We [Receivables Management Solutions, Inc.] more or less try to fight them as opposed to settling them. But most of these attorneys that are out there today don’t care whether you fight it all the way through, that target is still on your back no matter what. They look at it as just a numbers game. Okay, you fight it, fine, we will just come at you again in the next round. So I don’t know how much of a deterrent it is. We have tried it both ways (fighting and settling) and it still seems to be out there. I don’t know how it is for everybody else.

KOTULA: I feel the same way. Both the FDCPA and now the fair credit reporting issue are igniting frivolous lawsuits. I worked in the credit reporting industry for eleven years, both with Equifax and Experian. I could watch this happening. I get letters from attorneys where it’s actually the bureau’s fault in reporting junior-senior relationships. We collect a lot of municipal taxes and we can see from a reporting entry that we may have ten to twelve different lines of taxes that we report and that could be actually twelve different charges against us for reporting that. We feel that we are reporting it right on our end but there are attorneys out there that are ready to go after this industry. And we are on the radar screen now because our company is growing at a pretty rapid pace and we are out there exposed and there are people that want to make a living off that.

COHEN: I am a little biased in this area but I would say that as agencies grow there is definitely a value to having at least one attorney on staff in your company. I am an attorney, so that’s why I say I am biased about it. But we have a lot of those same people coming at us and I think at that point it pays to have an attorney on the phone saying, "I am the attorney. I am in-house counsel. I represent this business. We do it right, we have our policies in place, and if you want to come at us you better be ready for a fight because we don’t settle." You’d be surprised how many you won’t hear from again. Those are the ones that are just throwing something against the wall to see what sticks. Now, you are going to have the attorneys that are the career people that you are going to have to fight, but the last thing you want to do is be a target. It may cost you a little more to fight some of the key ones but the more difficult you can make it for them, the better chance you have of them not coming back. And if you happen to win a summary judgment or something like that against any of the key ones, then you just throw it right back in their face. You use it as precedent and take advantage of it. Along those lines, I think one thing that agencies don’t do well is share precedent. I am mostly talking about the unreported cases. We just actually won something of a summary judgment that was very important to us and we did it by using precedent from a different jurisdiction on an unreported case but it was sufficient to win the day. That was a very important thing because it was one of these career people and we did do it right. And you know, I think if we didn’t have that precedent, we could have lost the summary judgment motion even though we did it right. So, I think there are a lot of resources out there that people don’t take advantage of and I think it’s in everyone’s best interest to share some of that information because we all deal with the same thing.

STRAUSSER: In addition to what we have already discussed with the fee issue: we do some debt purchasing but we are still largely a contingency agency. Trying to offer the same quality service for what amounts to be less and less as the years go on has continued to be a real challenge in our marketplace as I am sure it has for many of you.

MIKE SUTHERLAND: I am also seeing more and more agencies walking into the doors of my clients and my colleagues’ clients and offering to cut the rate five or ten percent from our current rate. We’ve [American Collections Enterprise, Inc.] had this happen within the last six months. I knew what my unit yield was, and as I had a conversation with this friendly competing agency, their response was, "We don’t care that we are getting a five dollar unit yield on the account." So, we, as an industry, can sometimes hurt ourselves by not focusing in on that unit yield as well as the rates that we are willing to quote. Sometimes I think we are quick to think "let’s just get the client in the door" instead of what that client is going to yield us to make it profitable.

GREENBERG: How have debt portfolio sales affected your busines and how have you responded to this trend?

STEIN: Adam (Cohen) taught me something very important about this subject: how debt sales affect my business and what we are doing to respond to this trend. About a year ago, Adam had the opportunity to refer a client to me, somebody who I went out and got business from. That was a very good client of his and they were apparently looking for another agency, he referred me and it turned out to be a nice relationship. And I said to Adam, in one of my many thank you’s, "You know, a lot of agencies don’t see things this way. Why do you?" And he said to me, and Adam you can change it if I am misquoting, "With the competition from debt sales, for me to have the opportunity to refer another very good agency will hopefully increase the liquidation numbers of contingency collection agencies. The more that we can do to help each other out in this area makes the need for debt sales less." Am I fairly close in how I am saying that Adam?

COHEN: Yes.

STEIN: Okay. So, one of the things that we can do is not undercut each other on fees and make sure that we refer other good agencies. The more we do that as contingent collectors, if that’s what we are doing, the more money we can bring to the bank for whoever the client is. That can show them that sales are not as profitable if an agency on the contingent side is doing a very good job.

COHEN: I think it actually works both ways, too. I think, on the creditors’ side, most of the large creditors out there tend are certainly going to take more than one or two good agencies just to exceed models. So the sales price would have to be that much higher than the market is going to bear. I think that’s the idea behind the referrals there. On the buyers’ side, a lot of the buyers outsource also and it’s the same mentality. If you have relationships with buyers that place out contingency, it’s the same referral process there because in that sense they need more than one good agency to help them get to their model so that they’ll continue to buy. So debt sales can certainly, at times, hurt our contingency business but with good relationships with buyers we can still get the placements. So, it does go both ways, but I think it’s good practice and that’s why I am never afraid to refer a good agency to one of our clients.

DUNHAM: I’ve experienced growing business from servicing both the creditor directly and debt buyers. When you are servicing debt buyers, on a credit card portfolio for example, that provides experience and exposure that will help when you go to market a creditor directly in the same type of portfolio. So having that experience and those types of results can help us get in the door to get another placement from a creditor directly. It provides a good opportunity to expand the business and our client base. So we will service the creditors and debt buyers and try to have a nice balance between the two.

FREEDMAN: It seems most of us, more or less, have had the benefit of being able to have relationships with the debt buyers in the absence of direct relationships with the original creditor. Regardless of who owns the account, whether it’s the creditor or the debt buyer, they still are going to have the same capacity/collector problems that put companies like ours in high demand. What we typically see is that the debt buyers just normally wind up paying lower fees with the same type of placement. I think the most frustrating thing in representing debt buyers for us is that we have seen situations where we have represented the original creditor and there’s a settlement amount. A debt buyer then comes in and purchases the account and gives us a blanket settlement amount that’s 25 to 30 percent higher. I don’t know if you guys have experienced the same thing but at that point it is frustrating.

STEIN: Debt buying has not affected my business negatively; it has actually affected my business positively. A good portion of the debt buyers who are out there, the big money debt buyers, don’t service what they buy. My top two or three biggest clients are debt buyers. They just become another potential client for me, another creditor.

STRAUSSER: I would concur with this whole debt sale issue, not only have we participated by buying some, but we are likewise servicing debt from buyers and also marketing to investors that are interested in buying debts that have never bought before. We’re kind of helping them in the process, so I’ve found this to be tremendous opportunity for us.

GREENBERG: Have you lost business as a result of a current client or a client at that time, choosing to sell debt rather than place it with your agency? Maybe you guys can just go around the horn with a "yes" or "no".

STRAUSSER: No.

KOTULA: No.

DUNHAM: Yes.

STEIN: Yes.

SUTHERLAND: No.

COHEN: Yes.

FREEDMAN: Yes.

GREENBERG: Interesting, about half and half.

FREEDMAN: I think that the response to that might be contingent likewise upon those of us that have a lot national versus just regional clientele.

GREENBERG: That’s a great segue, Jeff. Let’s talk about it in the next question, which is: What changes are occurring with your national clients compared to your regional client?

FREEDMAN: I would say from our end, definitely the most significant change has been their security consciousness and security demands. Almost all of our national clients are now requiring heightened security measures that they had never previously asked for or demanded of us. And that goes for existing clients looking to continue the business relationship or new prospective clients telling us what we need to have in place before they will even consider doing business with us. I’m talking about network intrusion detections, system controls, cameras in computer rooms and in operation spaces, and physical security audits and things of that nature. On the silver lining side of things, it’s made our company obviously better and more secure. Also, I would say it has clearly raised the bar as to barriers of entry for smaller companies to obtain national clientele, making it more difficult for them.

COHEN: I think we are going through basically the same thing. All of the outside certification and security measures that are being required, people talked about them two or three or four years ago, but it seems like now they are really starting to hit home for national clients. It is a prerequisite now, before they will even do site visits.

STEIN: Also the price of somebody incredibly large insurance policies the national client wants is a problem.

JEFF: Another one that we are starting to see rumblings of, and maybe some of you guys have already experienced, is clients kind of planting the seed regarding the possibility of having some type of overseas operation where they can almost piggy-back off of us and then insist on greater cost cutting measures on our end kind of getting the benefit of that. We are just starting to see that now.

COHEN: I think the overseas operations for pre-charge of outsourcing has been out there for a while. But now you’re just starting to hear a little bit of the rumblings for the charge off work. I think NCO was the first one to try it and I think they actually have some sites out there and they are putting some third party work in. Now you are just starting to hear words about the third party charge off overseas set ups, who’s got them, who’s going to do them, those kinds of things.

GREENBERG: Do you think that charge off collections from off-shore locations like India, the Philippines and elsewhere will succeed?

FREEDMAN: My initial gut reaction was to say no. But in time it may be able to succeed. Just like the entire debt collection business in this country had an infancy stage and then it grew up and it got better and it improved and it enhanced, I think quite frankly the same thing will probably happen in those locations as well, over time.

DUNHAM: The question has been discussed with our existing clients, whether it’s debt buyers or creditors directly. I think the recovery managers in the position of creating and judging performance and numbers, have a concern that overseas, in the early out or the pre-collection process, there will be success with soft collections. But getting to the hard collections, the charge off collections, expecting an overseas rep in a different country or from a different culture to call United States citizens and demand payment may be tough. I don’t know that the culture overseas or the mentality overseas is the same as it is here in the states as it relates to third party collections. I don’t know if it’s going to develop or if it would take a long time to develop to have the impact on the performance that creditors expect and that we are getting within our own shops.

STEIN: It is something that I am looking into, doing a personal off-shoring venture right now, something with the potential of actually starting up as a side company that can go ahead and be utilized by other companies. So I am going to find out here pretty quickly if there is some advantage to this or not. I have investors and partners; one of my partners is of Pakistani descent and has the ability to run it. So it will be American owned and Pakistani run. So we are looking at the model to do this and it looks like it’s probably going to happen.

STRAUSSER: I think this is another general comment for those of us that are on the smaller end of mid-sized. I think it’s becoming increasingly difficult to make that huge leap from being a regional agency to a national agency. There are so many barriers and so many requirements involved I think it is really tough for agencies to do that today. We had one national client for about two years. But then the demands got so great and the level of business did not increase, so we decided we were better off not doing it. So, I think that’s another issue too for a lot of folks in the business.

SUTHERLAND: I know Jeff (Freedman) had mentioned this with regard to the national clients, versus regional clients, but I think the security measures being required by national clients far exceeds what is required for regional clients. And I think a lot of it has to just do with the past five years of government regulations, like the Gramm-Leach-Bliley Act, HIPPA, and most recently the U.S. Patriot Act. Our clients are being forced to making sure that they are in compliance, and in turn it’s just trickling down to the agencies and so that’s where I am seeing more frustration. Our clients are just as frustrated with these compliance requirements.

GREENBERG: What effect has OSI’s bankruptcy had on your agency?

COHEN: I feel you don’t have a lot of time to worry about anybody else. There hasn’t been any concrete impact on our business that’s tangible. But I think there are certain markets that OSI competed in and still competes in where they were decent sized players with many call centers that, at the very least conceptually, you would think there is a little more of an avenue open, if you want to try to pursue that business. But with really tangible effects, I don’t think it has changed our business one way or the other.

DUNHAM: I think that Adam (Cohen) is right. From the charge off agency’s perspective, I honestly can’t recall seeing an OSI agency competing on a charge off portfolio whether it is a prime, secondary, tertiary, what have you. Their concentration was probably in an earlier stage at which and we are not — none of us are — into it like they were.

FREEDMAN: I guess the only thing that I would say is, in a general sense, when you have the second largest firm in an industry file for bankruptcy it is going to hurt the image of the industry that is already struggling with image to begin with. And then you have a company that’s calling on others to pay their bills, and it is supposed to be an expert in that area, and it’s behind on paying it’s own. These things are going to have to trickle down somehow. For example, it may make investors more weary of making large capital investments to agencies. It could cause clients or others to overly scrutinize the financial stability of a company like ours. I haven’t seen that yet, but obviously, we don’t know the long term effects yet.

STRAUSSER: I have had one larger client that was using OSI. The moment they heard about bankruptcy, they fired them and that has been a positive scenario for us. That’s the only thing we’ve had happen.

STEIN: It had no negative effect on us at all. I have not heard about it much from clients, and on the positive side we’ve had some of the OSI people or employees trying to come over here, that’s about all.

COHEN: It does cause you to take pause in the one sense that, and I am not sure what everybody’s goals are, if your goal is to remain a mid-sized business rather than trying to become one of the larger players, it gives you a little validation. I think it certainly shows that the grass isn’t always greener and certainly larger doesn’t always mean better, if it’s not managed properly.

GREENBERG: If any of your collectors work from home, how do you do that and why do you do that? As an add-on question, if any of you do it, has it helped you to attract more folks and retain folks?

DUNHAM: A few years back we tried this approach. We had a situation where a couple of collectors worked from home. Looking back and knowing what I know today, we don’t offer it as a option and I am not a big advocate of it. There are just so many variables that you have to manage with an employee, not only the employment issues regarding performance but also the security that the creditors or clients are expecting you to manage and maintain. It’s difficult enough for an agency to ensure that all the policies and protections and securities are in place with data backup and everything else on-site. To offer it for a collector at home is nearly impossible. Certainly it’s going to raise a flag for any potential client. Also, I am a big believer that collectors need an office buzz to keep them focused and productive while they are working their portfolio throughout the day. The ongoing training collectors need and the monitoring for technique and performance would be impossible from a remote location. Even the most experienced collector can start to take short cuts and deviate from the proper way to do their jobs. Another thing is office support. Collectors often need assistance sending or receiving faxes or accessing the forms that they need to get processed. Then there are system issues. If a collector is working at home the technology environment is out of your control. There aren’t IT guys sitting there to help them resolve issues and get them back on-line. So, that’s my take on it.

KOTULA: Last year we had a few people go out on maternity leave and I set them up in their home. They were top producers with our company and it turned into a real nightmare. It was a nightmare from setting up phone lines and the internal communications that we need and setting up their software on their home PC. It became a technology nightmare. And I agree with the buzz statement, that they need to be in the call center, because all of them are back right now and all of them are performing beyond the levels they were at before they left. So, I am not a fan of people working at home, I think they need to be in a structured, disciplined environment.

STRAUSSER: Now, we have not had collectors that work off-site but we have found an interesting opportunity with data entry. We have had three different individuals over the years, do some work from home and really enjoyed doing that and we have been able to directly monitor the productivity for some of that data entry. So, that works very well, but I share the same concern with the collectors and we would not be interested.

GREENBERG: What about using the Internet for collection, what do you guys see as the future of the Internet in the collection industry?

SUTHERLAND: We continue to use the Internet for exchanging data between our clients and our vendors and our agency is seeing a lot more client account placements filed via e-mail or FTP. We are seeing a lot more payment remit files for our larger clients and we are actually forwarding them via FTP ACH. We are also seeing a lot of our collectors using the Internet for skip tracing on multiple sites that are out there, I’m sure all are using those sites, for obtaining assessments and other information that’s available on-line. We are continuing to use the Internet for education, on-line training, FDCPA and FCRA training through the certification programs with ACA. The Internet is useful in client communications and credit bureau reporting, in fact all of our credit bureau reporting inquiring and reporting is done on on-line now. As far as the future of the Internet in the collection industry, in my opinion, in order to remain competitive we are going to have to utilize the Internet in order to compete effectively. But with the FDCPA issue, it’s my opinion that we are not going to see any collection activities performed on the Internet due to potential third party disclosure issues. I believe that unless we see some changes within the FDCPA, or at least some FTC interpretation or commentary, the use of the Internet is not going to provide us any advantage.

STEIN: We do some medical collection in one of our divisions, and due to HIPPA regulations, the Internet almost totally out. I think it’s totally out. There are so many different things that they regulate, there is no way we would ever be able to use it. But we obviously use the Internet for a variety of different things. Not necessarily for collection, but I can’t see it happening on the collection side anyway.

STRAUSSER: There are a number of agencies out there that are fairly actively e-mailing consumers and some larger companies that have deeper pockets realizing that at some point in time there are going to be legal challenges and they are kind of willing to be the guinea pigs out there and go to court to get that legal precedent set for us. I do think that there could be some opportunities for better communication by the Internet in the future, I don’t know how near that future it is going to be but I do know that there is some activity going on in that regard.

FREEDMAN: I think there is a possibility of making long distance calls over the Internet. I know that there are some things out there that have been discussed and that would be a huge impact on our industry because if that can be done it would virtually eliminate the long distance phone call cost. There are some things that are out there, some products that we have seen that are possibly out there in the marketplace, and some that may be a few years down the road. And if that happens, obviously that would be huge.

DUNHAM: The Internet has certainly brought us to a whole new level of collections and how we do our business with our clients. I think the thing that it’s done for both the clients that we service and the agencies is picked up the urgency, the level of intensity everyday simply because the Internet has provided e-mail which immediately gives response. You can communicate with your clients and within minutes be able to process whatever the request is or be able to respond to a request.

GREENBERG: What effect do you think the Do-Not-Call legislation ultimately will have on the collection industry, short term or long term?

STRAUSSER: The executive committee with the ACA and the ACA staff in general has been very focused on this in the last few weeks because of some of the decisions and renderings regarding the Telephone Consumer Protection Act. The feeling is that on a long-range basis, it would be almost unimaginable if this thing would start to target our industry. However, there was a hearing the other night that was televised, I think it was on C-Span and it was very interesting. They had the FTC chairman Muris and FCC chairman Powell testifying regarding several industry groups and then talked with some legal experts and they came dangerously close to our backyard in their discussions regarding this Do-Not-Call list. Our industry is exempt obviously but I think the fear is that when you look at what has happened with the direction of the FDCPA, the FCRA, HIPPA and now this Telephone Consumer Protection Act, you can’t help but fear it may get out of control. I don’t think it’s going to have a terrible impact upon our businesses but like any other legislation that is out there, we have got to be on guard. And that’s what we are doing on a national basis with the ACA monitoring this legislation on a minute-by-minute, day by day basis to make sure that it doesn’t take some kind of insane turn. So, I think that the general answer from my perspective and on a national basis is that I don’t feel that this is going to have a direct impact on our industry but we need to be wary.

DUNHAM: I would like to share the experience I had back in July the Do-Not-Call list went out and the telephone vendors had to stop commercial businesses or code their lines for the circuits that would not display the name or phone number according to the laws that were passed. It did affect us, all of a sudden we were getting blocked calls on all kinds of numbers that we were dialing out and it took a good month dealing with my long distance vendor to get their technology people in there and get the circuits coded correctly. As Harry (Strausser) said, we are exempt, and we are not a solicitor, we have a purpose and we have a right to make this call. But it did take about 30 days to get our circuits coded correctly so we could make those calls again.

FREEDMAN: I think one possible short-term effect for us as agencies is the possibility of confusion on the part of the unsophisticated consumer who naturally assumes that we are under the Do-Not-Call umbrella. There is a cost associated with explaining that we were not covered, there is the potential of complaints to a clients; just having to deal with those administrative types of things in the short term as the public gets more educated about who is covered and who isn’t.

GREENBERG: How often would you say that debtors respond in that kind of way, where they believe that you shouldn’t be calling?

FREEDMAN: We get it, put the Do-Not-Call registry aside, we get things literally every single day where debtors are actually trying to educate us about what we can and can’t do. You’re constantly dealing with those types of things.

STEIN: I had a pretty long conversation about this. I don’t see how it can affect our industry. Obviously there are indirect effects but I cannot see how our industry would ever be included. There is no way, the banking lobby would be much too heavy and I think what our industry means to everything from consumer credit to finance, I can’t imagine how they would tell us we cannot collect the bill or how a credit card company cannot get money that is owed to them.

FREEDMAN: I still think it’s a dangerous precedent to set. I think we are already an extremely regulated industry and it wouldn’t take much to make the next step. I am sure when FDCPA first came out there were a lot of people saying there is no way they can do this to us and that’s what scares me.

DUNHAM: The danger is that if the volume of complaints continue (to the FTC or FCC) and those agencies continue to take them, it will have an effect. Let’s face it — this industry is one of the highest as far as complaints coming in. What kind of crazy thoughts will they have just to eliminate the complaints and appease the public? It could come down to who is trying to get elected or what party is in control, you never know what can happen.

COHEN: I just wonder how far they will stretch on this. Due to regulations, are they going to say that if want to call a consumer you have to call using a manual phone, that you can’t use an automated dialing device. I mean that’s not a far stretch and think about what that would do to the sub-prime industry, think about that would do to the pre-charge off industry.

STRAUSSER: I think all of you have probably, even if it’s on a minimal basis, been involved in some legislative issues and at the 11th hour somebody can throw in an amendment to legislature like this, just blind side you just out of nowhere and that kind of thing has happened in the past with other types of legislative activities. I don’t think we need to get ourselves terribly bent out of shape about it, but continue to take it seriously.