As certified members of DBA International, Encore Credit and Portfolio Recovery Associates are facing audits from the association following their settlements with the Consumer Financial Protection Bureau.
Both companies have been members of DBA International at least 15 years.
Encore received its certification from DBA last April. It was not immediately clear when PRA Group received its certification. There are 47 certified companies, according to a listing available on DBA’s website.
What’s interesting to note in that press release announcing Encore’s certification is the “rigorous” process DBA used to ensure that Encore met the necessary standards. From the release:
These standards address account documentation, chain of title, consumer complaint and dispute resolution, statute of limitation compliance, vendor management, credit bureau reporting, resale, and other relevant operational procedures.
Many of the items lists as part of the certification process are areas where Encore — and PRA — were found to be deficient.
DBA’s Certification Governance Document includes a section on remediation procedures, in the event allegations are made against certified companies. If the Remediation Committee decides that there is sufficient evidence to support the allegations, then it refers the matter to DBA’s Audit Committee for a “limited compliance audit.”
Among the penalties faced by both companies are:
- Private censure
- Public letter of admonition
- Suspension of certification
- Non-renewal of certification
- Expulsion from the certification program
DBA takes the penalties even a step further, outlining the types of findings that could result in each category of possible penalty. For example, private censures should only be used when the violation is “minor” and has been remediated. A public letter of admonition is used when a minor violation has not been remediated or a major violation has been remediated. Suspending a certification certificate would require a “serious legal or regulatory violation” that has not been remediated. A company should be expelled from the program when “egregious” conduct is a willful violation of law or regulation and no remediation efforts have been made.