- Congress moving to let federal collectors call mobile phones
- `Stupid idea,' says Missouri Democratic Senator McCaskill
When it comes to robocalling your mobile phone, the U.S. government is taking the position, “Do as I say, not as I do.”
Months after the Federal Communications Commission tightened rules to protect consumers from unsolicited calls and texts from telemarketers, Uncle Sam is getting into the business. Buried in the budget deal reached by Congress and the White House this week is a provision to let debt collectors automatically dial the mobile phones of people who are late making payments to the government -- such as for student loans.
“This is a stupid idea,” said Senator Claire McCaskill, a Missouri Democrat. “We should be getting rid of robocalls, not empowering the federal government to make them.”
The U.S. pays about $1 billion per year to debt-collection companies, according to Bloomberg Government analyst Brian Friel. Ceannate Corp., Continental Service Group Inc., Navient Corp. and Performant Financial Corp. are among the top debt collectors, primarily for delinquent student loans.
The bill, which passed the House on Wednesday and is before the Senate, created a category of automatically dialed calls exempt from normal restrictions: those that are placed “to collect a debt owed to or guaranteed by the United States.”
The change removes an outdated impediment and it doesn’t allow blanket calls to all numbers, said Cindy Sebrell, vice president for public affairs at ACA International, the Association of Credit and Collection Professionals.
“The government is acknowledging that limiting dialing technology for legitimate debt collection doesn’t make sense,” Sebrell said.
The idea has backing in the Obama administration, which proposed allowing robocalls to wireless phones for debt owed to the government in its latest budget. It estimated a gain of $120 million over 10 years.
Allowing student-loan services to contact borrowers via cell phone creates “a much better chance at helping that borrower resolve a delinquency or default,” the Education Department said in an Oct. 1 report.
“We never really thought this administration would be our enemy at this point, and we’re really disappointed,” said Margot Saunders, counsel to the National Consumer Law Center that opposes the provision.
“It costs money to many people to receive calls on their cell phones,” Saunders said. “And it’s very invasive. People tend to bring their cell phones everywhere and to answer them to make sure it’s not an emergency.”
Saunders said her group would turn its attention to the FCC, which will set rules for the number and duration of calls.
McCaskill had a suggestion: “One robocall a year, for 10 seconds.”
Emily Cain, a spokeswoman for the Office of Management and Budget that helps the White House set budgets, didn’t immediately respond to an e-mail. Neil Grace, an FCC spokesman, declined to comment.