Adam Parks (00:08)
Hello, everybody. Adam Parks here with another episode of Receivables Podcast. Today, I'm here with another industry legend, Mr. Mark Cavin, who has served in a number of different capacities around the industry. And we're going to get into that today. But Mark, thank you so much for joining me and sharing your insights.
Mark Cavin (00:28)
Adam, it's really good to be here. Good morning, everybody.
Adam Parks (00:31)
Well, really do appreciate you coming on. For anyone who has not been as lucky as I have to become your friend through the years, can you tell everyone a little about yourself and how you got to the seat that you're in today?
Mark Cavin (00:42)
You betcha. Well, I've been in the industry for 47 years, believe it not. I started really young. Having worked at Union Bank of California, I ran recovery and collections there as well as small business workouts. Then I began selling debt with Judy Hammond early back in the days when the Debt Buyers Association was around.
And then went to work for companies like Arrow Financial Services, Sallie Mae, Asset Acceptance, and Jefferson Capital, which of course we're all in the of the debt buying industry. And I've been consulting in addition to that for about 25 years. So I have done quite a number of things and have been blessed in my career to have worked in the US, built call centers in India.
South America and Canada, as well as I've focused a lot of my time in the compliance and operational strategy area. Most recently I've been spending a fair amount of time in litigation and strategic guidance as well as become an expert witness that we'll talk a little bit more about going forward. But it's I've been blessed to do it all. Started when I was 16, so now you can do the math and I know.
Adam Parks (01:47)
And you've also spent some time at the CFPB as well.
Mark Cavin (01:50)
That is correct. Thanks for bringing that up. A part of the CFPB, was doing some work for the state attorney generals in the area of compliance and policy review, kind of at the state level, if you will, specifically. And then I joined the markets team with John McNamara, primarily focused in the collections verdict with Gandhi Eswaramoorthy. Got right to the CFPB when we were rolling out Reg F.
which was quite interesting. The markets team at the CFPB, for those of you who aren't maybe as familiar with it, are really a bridge between the regulatory compliance side of the CFPB and the street, a conduit of information going back and forth.
I also was involved in the medical debt burden in the United States, a deep dive report when I was at the CFPB, which was quite interesting. That led me to really open up my eyes with regard to medical receivables a little bit more than the experience I had. I left the Bureau in February, and now I have reformed my consulting firm, Collection Intelligence. It goes by CI to make it easy.
Adam Parks (02:53)
Well, let's talk about that a little. What is it that you're doing there? You've got all this consulting experience. You've had a lot of opportunities to see behind the curtain a lot of different ways and your understanding both of the industry side as well as the regulator side has to provide some unique insights. Talk to me a little bit about what you're doing at Collection Intelligence or CI.
Mark Cavin (03:16)
Really six different verticals. We deliver expert ethical solutions in debt recovery and compliance, as well as regulatory expertise, strategic guidance, and expert witness solutions. So regulatory compliance and consulting to both the industry and all asset classes. I've been fortunate to work in all consumer asset classes, small business banking commercial, as well as student loans.
And then CI also does some work in collections and recovery strategy, applying operational experience and current new technologies within the industry. Subject matter expertise and litigation and support. When I was at a debt buyer organization, we acquired the assets
of a litigation law firm and ran that and shifted the work from external to internal and blended, you will, an internal external strategy, which led me towards giving my background to provide expert witness solutions, if you will, and debt consultations. I have done and continue to do some sales generation for a couple of companies that I've gotten to know over the years that I feel really strongly about. Two I'll mention, CPC, which is Central
Portfolio Control, a really good agency that's been around forever. And then on the medical side, Link Recovery Services, which is a master's service or kind of the medical area. So, and I've spent a fair amount of time in student loan sales generation, having been at Sallie Mae for some time. And then of course I do some public speaking and engagements, primarily around education and providing information to the industry to the extent I can add value.
Adam Parks (04:24)
There is a lot for us all to learn about student loans with all the uncertainty coming down the pipe right now. It feels like it's kind of a big question mark out there as to what comes next, or at least not what comes next, but more about how it happens.
Mark Cavin (05:02)
Exactly. will say, know, given the CFPB's constraint in staffing, it used the term demise of the CFPB. Some folks within the industry are probably rather happy about that. But I will say the states have become extremely aggressive.
Mark Cavin (05:19)
And if you're not paying close attention to statewide compliance and regulatory oversight, not only at the regulatory and new acts or laws are being implemented, but the district attorneys are now kind of getting in the game and looking at various components of debt collection disputes and debt servicing, if you will. One other point I'll make is to those who are happy, if you will, about the CFPBs, lessening in enforcement right now. If the administration changes it four years, trust me, there will be a look back period four years from now on things that are currently being looked at, if you will. So from a compliance oversight perspective, I can't emphasize enough the need to really look at the state level activities and maintain federal compliance because of the complexity of the industry we're in.
Adam Parks (06:09)
I think when it first started happening, there were more people that were, I'd say, happy that the CFPB was being constrained. And I think, you know, on some level, there some some constraint was necessary. But I also believe that the move to the state level is a much bigger challenge for businesses to be able to manage. And I don't know that eliminating or restricting the CFPB in this way is the best move forward, because the political pendulum, as you mentioned, is going to continue to swing back and forth and back and forth. And I think that creates even more confusion. Having rules of the road is what the debt collection industry was looking for. And ultimately, I think got to some extent when it came to Reg F.
But that's what I think the industry is really looking for is just those rules of the road. You tell us what a stop light looks like and what a stop sign looks like and what the rules of the road actually are. And I think that's where the industry, most of the players in the industry really want to find themselves.
Mark Cavin (07:12)
So you're absolutely right. You know, when I talk with the key executives at RMAI as an example, they are concerned and have been advocates of the federal regulatory oversight body, as well as some other industrial, industry based entities, if you will. it's important to, as an example, when you look at Rhode Island and a new reg that they just put out recently with regard to medical debt, that if you get a judgment and it's related to medical
Mark Cavin (07:37)
that you can't credit report it and you can't execute on the judgment if it was in fact an underlying medical debt. So that just points to the complexity and difficulty with regard to managing the environment that we're all in today. it's good to, and where I think CI provides values, we deliver expert ethical solutions in debt recovery and compliance, as well as debt collection expert witness services.
Litigation isn't going down. I would suggest that plaintiff actions are increasing. saw recently in November before the CFPB's Reduction in staffing there were about hundred and fifty five Regulatory items in play within the collections industry that could impact, you know the industry as a whole right now It's at about three hundred fifty five to almost four hundred at the state level So that kind of illustrates I think the complexity with the of what the industry has to deal with
Adam Parks (08:22)
Well, it's the complexity of having to deal with it in all of these different locations. And now, you know, how do you manage what's independent against what is good for the whole, right? So I think that it brings other questions to the forefront new challenges in terms of having to manage segments of the portfolio in different ways when we start talking about the state level.
Mark Cavin (08:48)
about it, particularly as it relates to debt collection expert witness services.
You know, there's case, analyzation and report preparation. Certainly, I've been providing some testimony in federal and state court, ⁓ the deposition and trial preparation, an expert opinion on regulatory compliance and standards. I think what I can bring to the table and what CI brings to the table is given the 47 years of experience, that's pretty diverse and the actual application of that. You know, I think we can, speak to and support the industry and my clients with regard to.
Mark Cavin (09:21)
to plaintiff litigation if you will. ⁓
Adam Parks (09:24)
Well, let's talk about what that
actually means and where this need comes into the space itself. The debt collection industry is never short of litigation. There's always some litigate whether it be between organizations, regulatory litigation, or there's always some sort of court actions that are happening. And there's only so many experts in the world that can stand up in front of a court as a debt collection expert and start answering the rather detailed questions as it relates to compliance expectations, operational, the reality right between what the rules are and how things physically operate. What kind of, projects are you working on in that space to help organizations better understand or to help even the court or jury better understand what debt collection is and how it fits into the greater credit ecosystem.
Mark Cavin (10:13)
You know, will say, given the frequency of litigation going on in the collection industry, particularly defense work, lot of judges aren't really familiar with the complexities of the operational components of collections, if you will. So you have to not only educate the judges, but you have to educate the juries to the extent that there's a jury. So I think it's important to...
Mark Cavin (10:38)
provide complex information and simplify it as much as you can so the jury can understand the material facts. And that goes to an awful lot of research and boiling it down. So it's simplified as it relates to the key points of the case. I think it goes to in testimony really understanding and applying the federal and state and local.
Mark Cavin (10:59)
laws if you will or rules and then certainly in deposition and trial staying focused on the facts. Probably one of the best defense lawyers out there that I've run across that's an expert witness is of course Manny Newberger as an example I think most people know him within the industry but you know providing clear defensible testimony and simplifying the complex issues really is important particularly right now credit reporting.
Mark Cavin (11:27)
standing, that last couple of years, what does standing mean as it relates to the case? Is there standing, is there not standing? And then you have, look at TCPA and what's going on recently with regard to at the high levels of the court with regards to interpretation. So again, I think right now it's a bit of a plaintiff's lawyer game. And to the extent you don't have tight compliance management system,
Mark Cavin (11:54)
and your procedures and operating processes are not clear and defined, when you go into court, having to define those and making sure that you have the information to support it is really important. I think, given my experience in 47 years, and CI's experts that we can bring to the table can offset and not only simplify and provide clarity when in court, but hopefully defend the industry as well as defend the consumer to the extent, you know, which side of the table you're on and ensure a clear outcome that's reasonable. know, explaining reason about reasonability is an interesting one these days as well, right?
Adam Parks (12:28)
So it's your.
Well, even trying to explain anything about debt collection in a short period of time, it's a rather complex subject that's impacted by a variety of rules and laws at the state, federal and even the local level. So trying to provide an understanding of it in short order is got to be challenging. It's a rather complex topic that needs to be distilled and distilled and distilled, but still communicate the breadth of what is actually happening.
And there's only so many debt buyer experts out there that are available to bring in to start having some of these conversations because that provides debt buying is a whole other layer of complication on top of debt collection, in my opinion. And how do you start to address those differences, right? So you really have to look at what is this case about and what are we trying to communicate here and how are we trying to communicate it? And then
organizing and drafting the reports to go with it. Now, when it comes to the data to support the statements and let's say a report that's being submitted to a court, is it third party research? Is it just information from the case itself that you have to compile? What does the breadth of that work ultimately look like from your perspective?
Mark Cavin (13:48)
Well, you know, really depends on the particular matter, I'll use probably the most, one I think the audience will most understand is when it comes to dialing and communicating with consumers, you know, what's a reasonable attempt to reach a consumer? How many times do you dial a consumer? Are you dialing the home phone or you're dialing the cell phone or you're sending emails? And, you know, how does one really define harassment as an example?
Mark Cavin (14:12)
In today's environment, we have just so many different forms of communication with regard to communicating with this consumer. When you're trying to answer the question of a definition that isn't clearly explained from a regulatory or a law perspective, it becomes somewhat complex. So what do you do? You look at case laws, other case laws that may have some standing or basis of the fact pattern.
You do research that's in depth with regard to a spectrum of years, let's say, to create a story. You talk to consumers as well as to lenders as well as servicers to understand what their policies and procedures are. And you look at things like in the CARD Act.
Where information is provided on a basis of, let's say, a number of institutions that report every other year to the CFPB with regard to what practices are, to establish what is, to the terminators before reasonable, what's reasonable, what's not reasonable. So ultimately, it's left up to the determination of a jury, which you need to simplify and make sure that you stay close to the fact better than they understand it.
Mark Cavin (15:20)
And of course that the judge really understands. It's within the framework of the guidance or yoshi that's provided with the case. Does that make sense?
Adam Parks (15:27)
Okay,
yeah, that makes sense. So I mean, when I start to hear that, though, I still hear about the distilling of the complex ideas down to a more simplified methodology that is capable of being communicated to, whether it be the judge or the jury in that, assuming there's a jury. And what does that ultimately start to look like? It does sound like that's a rather complex undertaking. How do you even begin walking down that path, Mark?
When somebody comes to you with a case, like where do you even start? Like what's step one in the journey of thousand miles?
Mark Cavin (16:01)
absorbing a lot of information. A, B, understanding the facts and the relevancy to the case. Three, being able to tell the story as it relates to one and two that I just mentioned. And then articulating those facts to create a foundational argument that's supported by that information to get the ultimate outcome. Sounds simplistic, just like collection is easy, right?
Adam Parks (16:02)
Okay.
Sure.
Sounds like you've got a process to build a process is what I is what I'm hearing. Like there's there's a procedure to build the procedure in order to get to the end result that you're looking for, which sounds rather complex. But for someone who's been consulting for, you know, 25 plus years, that seems like it's probably not as complex for you.
Mark Cavin (16:31)
That's correct.
Exactly. Yeah.
No, it's not. guess because I'm able to, I've, if you will, walked the talk and having run large call centers of 1600 people or so and having worked with collectors and being able to communicate is probably foundationally important and making sure that structure you obtain the right information to create the basis to support the case.
Mark Cavin (17:10)
Right, and that's a lot of different pieces there. We could probably spend the next hour just on discovery or interrogatories or the capturing of data and understanding the data as it relates to being, let's say, an expert witness.
How the other side is going to approach you try to rattle you and get you off the mark, if you will, depending upon what the circumstance may be. So I've been fortunate where I've worked on cases where I am, in essence, supporting the attorney general or the industry. That could be a law firm. That could be a collection agency. That could be a debt buyer. I see myself really as a centric in support of the consumer as it relates to fair practices. So I think having
Mark Cavin (17:50)
seen a lot of different things from running a recovery department to running debt buyers and selling inventory and building call centers offshore. In today's environment, the consumer is really centric and depending upon the approach and strategy you're applying is important as well as being mindful of compliance and reasonableness. And that whole concept of reasonableness I think is really at the center of a fair number of these cases. know, certain cases are black and white.
I really like the cases that are a lot more gray, you will. So we can define, if you will, the outcome that could benefit the industry, if you will.
Adam Parks (18:26)
Okay, I like I mean, I like that approach. So you're you're collecting the information at the beginning of the case, then you're organizing all of that so that you can start to really understand as you start as you go through the process of the case going through the discovery process going into our laboratories and having a organized way in which you can recall that information.
When I think about these large projects like writing the TransUnion report and how often I have to refer to the data set that's in front of me in order to write a coherent report that draws an analysis, comes to strategic conclusions, and ultimately gets published, I imagine it similarly, not because you're creating the same thing, but because it's
Mark Cavin (18:49)
Absolutely.
Adam Parks (19:10)
taking a massive amount of information, distilling it down and having to constantly be able to refer back to larger data sets in order to communicate cleanly, clearly and effectively the end result.
Mark Cavin (19:22)
You know, it's really good point coming back to the report. In any case that I engage, let's say, on behalf of a regulatory body, what I will do oftentimes is once I understand what the foundational elements are, I look at it like a problem statement. What are we trying to solve for? What are the issues?
Mark Cavin (19:42)
What are the underlying issues and what are the underlying laws, right? And then once you understand what the problem statement is or what you're trying to solve for, then it becomes an outline. So within that outline, what are the components within that outline? And then what are the stories within the outline and how do they connect within each other? And do they create the argument around?
Mark Cavin (20:03)
the statement of the issues or problem statement. So ultimately a summary level report can oftentimes in a case be 20 or 25 pages and the report can take several months, which covers an awful lot of data, which then becomes the foundation before you get into testimonial activities such as, know, post interrogatories when you get into deposition and you get a trial. And oftentimes the judges will review that report in depth.
And if you write it the right way, then it helps the judge get a foundation of understanding because oftentimes many of the judges, particularly at the state and federal level, don't oftentimes understand the intricacies, if you will, collection processes and how you can relate to those collection processes. So the report becomes foundationally critical and important.
Mark Cavin (20:50)
not only to build credibility, but to understand the elements of what you're trying to solve for and what the case may ultimately be designed for before you get into arguments. So research is extremely important as it relates to that process.
Adam Parks (21:06)
That makes a lot of sense, which means to me, when I start thinking my way through this, it sounds like it's the perfect job for someone who does consulting. A professional consultant who can take these complex ideas, simplify them, distill them, and then create a deliverable report on the tail end that actually communicates the final product. And that, I think, is also another challenge. Just being a debt collection expert is never enough in that aspect. You have to be able to, you have to be a powerful communicator, which has been your reputation for the last many, many years, right, is being able to cleanly, clearly effectively communicate. And I think that seems like a really nice tie in. So when you think about this, this new business, right, collection intelligence, and you've got this focus on the expert witness testimony and being able to provide those types of solutions, talk to me a little about how that crosses over to the other types of projects. And I mean, the skill set that you've developed,
As a consultant, you're using it in that aspect for the expert witness testimony. How are you carrying that across into the other areas of consulting that you're doing?
Mark Cavin (22:12)
Yeah, know, consultants are really investigators. We're researchers, right? So it's like mining a treasure to kind of find the gold to a certain extent, if you will. When I'm consulting, I'm an active listener. Let me understand what you're doing, how you're doing, how you're going about it, and where the opportunities may be.
Mark Cavin (22:35)
I do know one thing that I can try and communicate, if I can communicate a little bit better each and every day and I listen, actively listen, I can oftentimes pick up materially what's really kind of at the root of the issue of what's going on. So my consulting business, it's a lot of listening, it's a lot of understanding, and it's a lot of really understanding the opportunities and developing a plan, if you will, to the extent that the client can identify one, two, or three things. I know one thing you can't, when you go to a consulting gig,you can't solve 10 things. What are the one or two things you can really solve for and build on and measure the outcomes, right? I'm a strong believer in measuring the outcomes of whatever deliverable you implement with your client. As a matter of fact, in some of my consulting gigs, what I've done is I've gone in at a reduced rate with the opportunity to get some upside on the back end side once the opportunity or implementation has been realized.
Adam Parks (23:05)
Yeah.
Mark Cavin (23:30)
So in the expert witness side of things, it's similar. Again, you're trying to communicate the outcome of what your understanding of the problem statement is or what you're trying to solve for. But I see the ultimate measure outcome being the jury or the result or the decision that's made by the court, if you will. That's where the true measure comes in, and the benefit.
Adam Parks (23:46)
Well, that's interesting.
That's what's the interpretation from your like your targeted audience and your targeted audience when you're going into do strategic consulting is going to be the end users and ultimately the consumers behind that. And when you're doing the strategic consulting, your ultimate customer is the consumer account holder that sits behind everything because their behavior, your ability to impact and change their behavior towards payment is ultimately your goal.
When it comes to the expert witness side of things, your ultimate goal is to make sure that you're educating the judge, you're educating that jury if there's a jury in order to position or to, I mean, it's really an education either way. You're trying to influence behavior in some way, shape or form.
Mark Cavin (24:35)
Yeah, and provide transparency, not only transparency, but the impacts of that transparency to the consumer and or whatever the issue may be before the court. collectors have, to use the term, a bad name, When you...
Mark Cavin (24:55)
What I really like is when a collector has a good outcome of the consumer, the consumer is happy that there was transparency, that they were dealt with a certain way. think 99 % of people who have debt would love to resolve debt. And the trick for us, of course, is to find a way to do it in an empathetic, compliant, regulatory manner.
But right out of the gate, when you're in court and you're representing or you're part of the side that's the collection industry, you've got to overcome that stigma that all collectors use a certain approach. Well, that's not the case. The collection industry provides well over $90 billion back to the ecosystem.
Mark Cavin (25:35)
as a whole within the industry. And on the debt buying side, it was actually the Treasury that began the process of debt buying back in the days of the demise of some of the banking laws and institutions when they fell. So they started selling debt and that really provided value given the economy as a whole. I think.
Adam Parks (25:46)
Yeah.
Mark,
you got to go way back to start talking about the RTC auctioning off bank assets during the savings and loans crisis of the 1990s. I did an episode with Mike Colby on that. Not, it was probably a few years ago now because he was working for the RTC at the time as it was birthed. But I don't know that everybody goes, I don't know everybody truly understands the history of the debt buying industry.
Mark Cavin (25:57)
the RTC, but you know, yeah.
Right. Sure.
But to tease that as an example, I think when you're in front of a court or in front of a jury, not everybody knows that. Not everybody understands the value and the importance of a debt collector. Or on the regulatory side, the importance of oversight and consistency of the consumer as it relates to treating fairly. So again, it goes back to the nature of the issue before the court. But I think foundationally educating the court, educating...
the jury is just as important as writing the report around the foundational facts of the case too. So although simplistic, complex, right? So.
Adam Parks (26:49)
Yeah, well, it's to take
Mark Cavin (26:50)
That would be an overlay politics, to use the term politics, into the kind of square of the problem becomes even more interesting because politics oftentimes drive different desired outcomes. It can create cloud or the jury or cloud.
Mark Cavin (27:06)
the issues and facts that you had before you. So, you know, it's another complexity that you need to overcome. that's why I think it's important to be able to write a clear, good report, understand the problems you're solving for, articulate those, and then when you're either being deposed or you're in front of a jury and a judge, being able to explain that complexity in a simplistic way so they understand it and educate them.
Adam Parks (27:29)
Well, Mark, this has been a fantastic discussion. really want to thank you for coming on and sharing your insights with me today. I always appreciate an opportunity to have a chat with you. Is there anything that I didn't cover today that you wanted to say to our audience?
Mark Cavin (27:31)
Right.
No, other than CI is here to help you. You can find me at www.collectionintelligence.org. Here to help.
Adam Parks (27:51)
I will put that
in, I'll put the link below as well.
Mark Cavin (27:55)
I appreciate that. Thanks Adam, appreciate the time today.
Adam Parks (27:58)
Well, I really do appreciate you coming on Mark for those of you that are watching. If you have additional questions you'd like to ask Mark or myself, you can leave those in the comments below and we'll be answering those or if you have additional topics you'd like to see us discuss, you can leave those in the comments below as well. And hopefully I can get Mark at least back at least one more time to help me continue to create great content for a great industry. But until next time, Mark, I really do appreciate you. Go ahead.
Mark Cavin (28:17)
Here's it.
Here's an idea, I got an idea for you. For anybody out there that would like to meet with me, I'm gonna be at DCS, Debt Collection Symposium, coming up here in September. And then I'm gonna be at ComplianceConn in October. So more than happy to meet with you. Maybe we can do a session at one of the conferences at them. Just let me know.
Adam Parks (28:27)
Maybe
we can, but I'm gonna be gone in October, I'm going to Brazil. But we'll make something work, Mark. I look forward to spending some time on stage with you. But again, thank you so much for joining me. I really do appreciate your time and attention. And thank you everybody for watching. We appreciate your time and attention as well. We'll see y'all again soon. Bye everyone.
Mark Cavin (28:42)
All right.
Thanks.
