Credit Card Issuer
Examiners identified that issuers violated Regulation Z by offsetting consumers’ credit card debt against funds that the consumers had on deposit with the issuers without a signed authorization/consent from the consumers.
Failure to obtain signed authorization before attempting to enforce the credit card debt from the consumer’s security interest is a deceptive act and resulting in the consumer facing financial difficulty.
The Copasys® solution:
Records are classified as ‘Compliant’ when the required the payment is debited from the deposit account upon receipt of the signed authorization from the consumer and ‘Non-compliant’ when authorization is not received or available at all or it was received after the payment was debited.
Initiating certain debt collection testing rules coupled with effective remediation activities helps: