Compliance Center: TCPA Court Ruling Highlights Human Intervention

The FCC’s Declaratory Ruling on the Telephone Consumer Protection Act (TCPA) has been a topic of discussion ever since the ruling was issued. Unfortunately, the ruling has forced many credit unions to make significant changes that do not benefit members or consumers. But a recent court ruling may held shed some light on one of the key concerns of the TCPA—human intervention and auto dialers.

A ruling recently issued by the Central District Court of California held that human intervention does make a difference when TCPA violation cases are brought before a court. In Freyja v. Dun & Bradstreet, the plaintiff claimed that Dun & Bradstreet violated the TCPA because they used an auto dialer to call her cell phone while she was listed on the Do Not Call List.

However, the defendant was able to prove that the phone call was made using a phone, specifically an Avaya 4610 desktop telephone that “cannot, itself, be used as an autodialer.” The court did note that the phone could receive auto dialed phone calls if all the necessary components were present (appropriate computer software, login credentials of the user, and the dialer being configured). However, in this case, the phone number was manually dialed.

While there were some other issues with the plaintiff’s complaint, it is important to make note of this ruling. This may be something worth discussing with your legal counsel to determine if it has any impact on your current process or response to the TCPA declaratory ruling issued earlier this year.

If you would like to read the memorandum issued by the court, you can do so here. If you have any questions regarding the TCPA, please send the compliance team an email at

Compliance Question of the Week

Can a credit union open a share account for someone who only has an ITIN and not a Social Security Number?        

Yes. The NCUA encourages credit unions to serve individuals who are within the field of membership regardless of citizenship and regardless of whether they have a social security number or not.

An ITIN (individual taxpayer identification number) is a tax processing number issued by the Internal Revenue Service. It is a nine digit number that always begins with the number 9 and has a 7 or 8 in the fourth digit, example 9XX-7X-XXXX. IRS issues ITINs to individuals who are required to have a U.S. taxpayer identification number but who do not have, and are not eligible to obtain a Social Security Number (SSN) from the Social Security Administration (SSA). ITINs are issued regardless of immigration status because both resident and nonresident aliens may have U.S. tax return and payment responsibilities under the Internal Revenue Code.  Individuals must have a filing requirement and file a valid federal income tax return to receive an ITIN, unless they meet an exception.

Once this person is a member, he or she is entitled to all the services and products available to all other members.

It is also important to obtain other verification documents as part of your due diligence. ITINs are not valid identification outside the tax system. Since ITINs are strictly for tax processing, IRS does not apply the same standards as agencies that provide genuine identity certification. ITIN applicants are not required to apply in person, and the IRS does not further validate the authenticity of identity documents. ITINs do not prove identity outside the federal tax system, and should not be offered or accepted as identification for non-tax purposes.

ITINs will expire if they are not used on a federal tax return for any year, for five consecutive years.

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Legal Briefs

National Credit Union Administration (NCUA)

The November edition of the NCUA Report is now available. This month’s report includes articles on the RBC Rule, handling consumer complaints, and understanding the NCUA’s need for vendor authority (part 2).

The NCUA released its November Board Action Bulletin, detailing the outcome of its November 19th meeting. The action include an approval of a proposed rule to modernize the field of membership for federal credit unions, the NCUA’s 2016-2017 Annual performance plan, and an operating budget increase of 4.1 percent.

The NCUA has published statements and prepared remarks from all three NCUA board members regarding the proposed field of membership rule.

Consumer Financial Protection Bureau (CFPB)

CFPB Director Cordray delivered prepared remarks at the Financial Literacy and Education Commission Meeting. Cordray’s remarks focused on educating consumers about long-term financial wellness, including saving for retirement.

The CFPB has released its Fall 2015 rulemaking agenda. The agenda includes initiatives like arbitration, prepaid accounts, payday and auto title lending, overdraft and debt collection.

The CFPB announced that the maximum allowable charge that a consumer reporting agency can charge will remain unchanged at $12.

Federal Reserve Board (FRB)

The FRB posted the Minutes of the Federal Open Market Committee meeting from October 2015.

The FRB has updated its Consumer Compliance Handbook which includes amendments regarding the TILA/RESPA Integrated Disclosure changes, HPML appraisal requirements, and small servicer definition.

The FRB has updated the Reserve Maintenance Manual.

Federal Deposit Insurance Corporation (FDIC)

FDIC Chairman Gruenberg delivered remarks at the Clearing House Annual Conference. Gruenberg’s comments focused on resolution plans, or living wills, that are required under the Dodd-Frank Act for the largest bank holding companies.

The FDIC issued FIL-52-2015 to clarify that the guidance, focusing on payday lending programs, does not apply to banks offering services to non-bank payday lenders.

Federal Housing Administration (FHA)

The FHA announced that it has published new guidelines under its condominium approval process to increase housing options for first-time homebuyers. The temporary guidance is effective immediately.

The FHA released its 2015 Annual Report, which shows that the Mutual Mortgage Insurance (MMI) Fund’s capital ratio is at 2.07 percent. Congress requires that the MMI Fund’s capital ratio be at least 2 percent.

Federal Housing Finance Agency (FHFA)

The FHFA released its 2015 Performance and Accountability Report. The FHFA received a clean audit opinion on its 2015 financial statements from the U.S. Government Accountability Office.

Federal Trade Commission (FTC)

The FTC announced that it has approved final amendments to its Telemarketing Sales Rule. The changes include prohibiting certain types of payments, including payment orders processed via remotely created checks, which are commonly used by scammers.

The FTC released a commission letter that allows for a new type of verifiable consent under the Children’s Online Privacy Protection Rule. The approved method involves “Face Match to Verified Photo Identification”, which involves the submission of a valid photo identification (that is verified through this technology) and a photo taken of the parent’s face with a phone camera or webcam.

Office of Foreign Assets Control (OFAC)

OFAC has updated the SDN list as of November 19, 2015. The last update prior to this was November 17, 2015.

Questions? Contact the Compliance Hotline: 1.800.546.4465,

Posted in Compliance News, Federal, NCUA.