 In this issue:
Letters to the Editor
In case you haven't received the word, The Free Press has instituted a "Letters to the Editor" column. If you don't want to take time out of your busy schedule to do research for a scholarly article, if you have a suggestion, recommendation, or constructive criticism to direct to the Section leadership or the Free Press editorial board, or if you just want to "vent" (in a non-abusive manner, of course), you will now have a forum. You can submit a letter any time it suits your fancy, and you need not wait until just prior to the publication of an edition of the Free Press. Submissions will be kept on file for future publication. Please submit your letters to Livui Vogel, co-chair of the CRS Newsletter Committee. The Free Press Best Feature Article Award
The Creditors' Rights Section will annually recognize outstanding articles submitted to The Free Press, with a "Best Feature Article Award" to be presented to the author of the winning article, at the Creditors' Rights Section general membership meeting at the CLLA Eastern Regional Meeting in New York. Articles submitted for the Fall, Spring and Summer editions of The Free Press will be eligible for the award and will be considered for the award if so requested by the author. Any articles submitted for the Summer edition of the Free Press for consideration for the Best Feature Article Award must be submitted to the Free Press by May 15, and judging of all articles submitted for the Award will take place over the summer. Each year, the Best Feature Article Award will be presented in New York, for the best feature article submitted within the previous year. The following criteria should be adhered to for articles submitted for consideration for the Award:
All articles must be submitted in Word formal, via e-mail to Liviu Vogel, co-editor. Any questions may be directed to Brenda Majewski, (414) 276-0435, co-editor. Your subscription
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The Free Press - Volume 3, Fall 2008 Report from the ChairBy Mark Sheriff, Esq. Looking forward to the New York meeting this year as it will be a good opportunity for the Section to assess where it stands now and where the Section wants to go in the future. Obviously, as the CLLA moves forward with its Strategic Plan, our Section will be an integral part of any plan. We need to have some understanding and working relationship with regard to how the CRS fits within the CLLA's Strategic Plan. As always, we have excellent educational programs being presented by the CRS Section at the New York meeting. I would encourage all members to attend. It is important that we continue to get strong participation from our members. We have many opportunities available and encourage all members to actively participate and get involved, even if they are not members of Executive Council. We have many committees and plenty of opportunities to help the Section move forward in the future. It is with a heavy heart and much sadness that I ended up assuming the Chairmanship of the Section due to the death of Ed Friedman. It was certainly a great loss for the Section. However, under Ed's leadership, the Section became even stronger and continues to be prosperous. It is my privilege to take over and serve for the following year. I hope to see as many of you as possible at the New York meeting. Membership Committee ReportBy: Doug Evans, Esq. Check in November 15th at the CRS meeting in New York for an update on the membership committee activities. Washington Legislative ReportExcerpts from recent Washington Hot News distributions By David P. Goch, Esq. The Red Flags Rule was developed pursuant to the Fair and Accurate Credit Transactions (FACT) Act of 2003. Under the Rule, financial institutions and "creditors" with covered accounts must have identity theft prevention programs to identify, detect, and respond to patterns, practices, or specific activities that could indicate identity theft. Federal law defines a creditor to be: any entity that regularly extends, renews, or continues credit; any entity that regularly arranges for the extension, renewal, or continuation of credit; or any assignee of an original creditor who is involved in the decision to extend, renew, or continue credit. Accepting credit cards as a form of payment does not, in and of itself, make an entity a creditor. Some examples of creditors are finance companies, automobile dealers, mortgage brokers, utility companies, telecommunications companies, and non-profit and government entities that defer payment for goods or services. Financial institutions include entities that offer accounts that enable consumers to write checks or to make payments to third parties through other means, such as other negotiable instruments or telephone transfers. The rules were finalized in October 2007 by the FTC, the Office of the Comptroller of the Currency, the Federal Reserve, the Federal Deposit Insurance Program, the Office of Thrift Supervision, and the National Credit Union Administration. The rules became effective January 1, 2008, but covered entities were given until November 1 to comply. However, the FTC October 22 delayed the effective date of enforcement until May 1, 2009 for companies under its jurisdiction, i.e., "creditors", because of confusion over which companies should be covered by the new rules. Meanwhile, the Federal Deposit Insurance Corporation, OTS, began enforcing the rules as scheduled with financial institutions. The FTC recently has said it is working on providing more detailed guidance on the red flag rules, including which entities are covered (based on the complaints they received as described below). However, the FTC has not said when the guidance will be completed. It is also unclear how exactly the FTC will enforce the rules. Unlike the banking agencies, as confirmed by According to Pavneet B. Singh, an attorney in the FTC's division of privacy and identity protection, the FTC does not perform regular examinations: "We don't have examination authority in the same way that the banking agencies do." Singh said further, "We find our cases in a variety of ways: We may hear about complaints, or receive a tip, or ask for information about what companies in a particular industry are doing to comply with the rules." The amended 140-page OTS "Information Technology Risks and Controls and Fair Credit Reporting Act" section of its examination handbook is available at http://op.bna.com/pl.nsf/r?Open=dapn-7kwru8. The FDIC's examination procedures are available at http://www.fdic.gov/news/news/financial/2008/fil08105.pdf. The Federal Reserve's red flag "Interagency Examination Procedures" is available at http://www.federalreserve.gov/boarddocs/srletters/2008/SR0807a2.pdf. CRS Promotion and Marketing CommitteeBy Nicholas D. Krawec, Esq. As you may recall from the Chicago meeting, the Creditors' Rights Section had a presence at the CLLA exhibit in the hospitality room, with a laptop set up, displaying the CRS website, particularly the CRS on-line directory. I am happy to report that the display attracted a few new members to CRS, who were impressed with our on-line directory and the other benefits of membership. We are going to attempt to do the same thing in New York, and we will need some folks to help staff the booth and answer questions from League members who are not members of CRS, but show an interest in becoming one. If things work out the way I hope, we should have the laptop set up at the CLLA booth on Friday and Saturday from around 9:00 a.m. to 4:00 p.m. We could sure use your help in staffing the booth. If you are interested in helping out, please send me an email at nkkrawec@bernsteinlaw.com, and let me know which day(s) and which 2-hour interval (i.e., 9 - 11 a.m., 1 - 3 p.m., etc.) you would be available to help. See you in New York! Report of the Nominating CommitteeSubmitted by: Beau Hays, Chair Pursuant to the Bylaws of the CRS, a nominating committee was impaneled for the purpose of offering a slate of candidates for election as officers and council members of the Section. The past-chair is chairman of the nominating committee. The officer positions of Treasurer, Chair-Elect and Chair are, by tradition, assumed by the current Secretary, Treasurer and Chair-Elect respectively. The candidates for these offices are:
Each is unopposed. The Nominating Committee solicited interested parties to submit names for the post of CRS Secretary and for the four available seats on the CRS Executive Council. The nominees are:
The elections will be held at the General Membership meeting in New York on November 15, 2008. Report on the Strategic Planning and Leadership MeetingSubmitted by: Beau Hays, Chair In August, a group of League members met in Orlando to move the League's Strategic Planning process forward. Out of those three days came consensus on several areas that will direct the efforts of strategic planning in the coming year. The group identified five core values - the essence of the League:
With these organizational values established, the group set about identifying the four or five most important goals for the coming year. These are:
While these goals are largely structural rather than strategic, the group clearly identified that these areas needed to be addressed before the more targeted strategies for growth of membership and the like could be tackled. To overcome the very real possibility that the planning and enthusiasm generated in Orlando would start slipping away as soon as the group left the hotel, the final step taken in that meeting was to appoint a champion for each of the five goals. The champions each established a team, primarily from the members in attendance, to work on implementation, not of the entire stated goal, but of smaller pieces to be accomplished in the 90 days between the Orlando conference and the League's New York meeting. The initial reports of the champions will be made at a 90-day reload during the New York meeting. Going forward from there, each 90-day window will feature more of the tasks needed to accomplish these goals during the year. Finally, the League has scheduled next summer's Strategic Planning Conference, at Baltimore's Inner Harbor from August 6 - 9. As the Strategic Planning group rounds out the first year's structural goals, next summer's meeting is sure to focus more on action steps to be taken by CRS to further the League's core values and promote the vitality of the organization. Anyone and everyone interested in the future of the organization is invited to join in - although participants do run the risk of becoming a champion as the process moves forward. Letters to the EditorLetters or comments can be sent to LVogel@salonmarrow.com. In case you haven't received the word, The Free Press has instituted a "Letters to the Editor" column. If you don't want to take time out of your busy schedule to do research for a scholarly article, if you have a suggestion, recommendation, or constructive criticism to direct to the Section leadership or the Free Press editorial board, or if you just want to "vent" (in a non-abusive manner, of course), you now have a forum. You can submit a letter any time it suits your fancy, and you need not wait until just prior to the publication of an edition of the Free Press. Submissions will be kept on file for future publication. Education Committee ReportBy Matthew J. Burkinshaw, Esq. and Lorna Walker, Esq. CRS will host a number of education programs at the upcoming CLLS meeting in New York including Reel Justice! Power, Passion & Persuasion in the 21st Century on Saturday morning from 8:00 - noon. Plans are well underway for the Chicago education programming next April. The Education Committee welcomes comments on educational offerings. Practice Groups - New ConnectionsGet involved - get connected. The CLLA is THE NETWORK for Commercial Law. By: Rick Johanson, Esq. Newsletter Committee ReportThis issue marks my final issue as co-editor, as I turn the reins over to Liviu Vogel and a new committee. A call from Chris Hickey in the fall of 2003 has lead to a lot of newsletter publications with co-editor Nick Krawec initially and Liviu Vogel recently. The newsletter has expanded and shrunk based on a Chair's goals for the newsletter. It has also gone from a paper to an electronic edition, saving printing and mailing costs. The newsletter is circulated three times per year electronically in the Spring, Summer and Fall (and via fax for those rare few who are not online). Members, including members of the Executive Council, are encouraged to submit articles of interest or letters to the editor for inclusion along with a short bio for publication. (And since I will still be a committee member, I will still be helping to twist arms for articles.) This issue features the annual newsletter award winner for The Best Feature Article. The award and gift will be presented at the CRS meeting in New York. After this issue, Liviu Vogel, Esq., Salon Marrow Dyckman Newman & Broudy LLP, New York, NY will step into the editor role, training his successor.
Spotlight On Best Feature Article Award Winner: DONALD B. KRAMERInterview by Liviu Vogel, Esq. Work History: Practicing law since 1954 after serving two years in U.S. Army. Practiced law with firm of Kramer & Chused from 1954-1974. Practiced law at Kramer & Frank from 1974 to date. Family: Wife Elaine R. Kramer since Sept.7, 1952. 2 children: Jeffrey Scott Kramer, Travel Agent, and Janet Sue Esrock, Teacher Areas of practice and specialties: Collection and Bankruptcy What year did you join the CLLA?: Around 1980 What offices or committee chairmanships have you held in the CLLA ?: Chairman, Midwest District; Chairman, Fair Debt Collection Practices Committee; Advisor of Fair Debt Collection Practices Committee; Chairman of Federal Debt Committee. Tell us about your home life away from the office: I am a workaholic. I live in a condominium in St. Louis County. I go to a movie at least once a week. You are the fourth recipient of The Free Press Annual Best Feature Article Award. What was your reaction when you were informed that the Free Press judges selected your article as the winner?: My article was "What is a Reasonable Contingent Fee". Your e-mail was the first notice I had of winning any award. I was honored to be the recipient. Have you written other articles besides the writing you have done for CLLA?: Yes, I have written articles about "Tips For Collection Attorneys" and "Disaster Planning for Law Firms". Have you received other recognition for the writing you have done?: No. My honors have been in the leadership field. I received the "Don Kramer Award" from the National Association of Retail Collection work for "Outstanding Contributions to the collection industry and the community", and the "President's Cup" from the CLLA. What would your advice be to other League members who may be thinking of submitting an article to the Free Press for consideration for the Best Feature Article Award?: Find a nitch, and fill it. If you did not become a lawyer, what do you think would have become your life's work?: As a Teacher What is your favorite quote or "words to live by?": "If I am not for myself, who can be for me....But if I am only for myself, then what am I ? If not now, when? " The author is Rabbi Hillel. Did you have any role models when you were growing up and in your career in practicing law? If so, who are they and why were they your role models?: Dr. Abram Leon Sachar, my mother's brother, who was an author, lecturer, teacher, and first President of Brandeis University. If you could have dinner with one famous person in history, and one famous person alive today, who would they be, and why?: My Uncle, Dr. Abram Leon Sachar, who was an amazing communicator. What is your favorite:
Red Flag Rules in effectBy: Brenda A. Majewski, Administrator Another burden may have been placed on creditor clients, financial institutions and maybe law firms themselves, however, the requirements of a Red Flags Rule Program makes good business sense to anyone handling these types of claims. As of November 1, 2008,another part of the FACT Act relevant to creditors and financial institutions should have implemented a written program for identity theft protection that identified patterns, practices or specific forms, and should include a list of possible "red flags" that would trigger certain preventative events (http://ftc.gov/opa/2007/10/redflag.shtm). From the FTC: "Under the Rules, a financial institution is defined as a state or national bank, a state or federal savings and loan association, a mutual savings bank, a state or federal credit union, or any other entity that holds a "transaction account" belonging to a consumer. Most of these institutions are regulated by the Federal bank regulatory agencies and the NCUA. Financial institutions under the FTC's jurisdiction include state-chartered credit unions and certain other entities that hold consumer transaction accounts. A transaction account is a deposit or other account from which the owner makes payments or transfers. Transaction accounts include checking accounts, negotiable order of withdrawal accounts, savings deposits subject to automatic transfers, and share draft accounts. A creditor is any entity that regularly extends, renews, or continues credit; any entity that regularly arranges for the extension, renewal, or continuation of credit; or any assignee of an original creditor who is involved in the decision to extend, renew, or continue credit. Accepting credit cards as a form of payment does not in and of itself make an entity a creditor. Creditors include finance companies, automobile dealers, mortgage brokers, utility companies, and telecommunications companies. Where non-profit and government entities defer payment for goods or services, they, too, are to be considered creditors. Most creditors, except for those regulated by the Federal bank regulatory agencies and the NCUA, come under the jurisdiction of the FTC. A covered account is an account used mostly for personal, family, or household purposes, and that involves multiple payments or transactions. Covered accounts include credit card accounts, mortgage loans, automobile loans, margin accounts, cell phone accounts, utility accounts, checking accounts, and savings accounts. A covered account is also an account for which there is a foreseeable risk of identity theft - for example, small business or sole proprietorship accounts." Note that the Equal Credit Opportunity Act has defined a creditor to "include a person who arranges for the extension, renewal, or continuation of credit, which in some cases could include third party debt collectors (italics added). Covered organizations should have completed a risk assessment that reviewed the types of accounts they maintain, including personal and business accounts, and reviewed the methods of opening or accessing those accounts. Written policies must address theft prevention programs that are designed to detect, prevent and mitigate identity theft. Policies and procedures must identify relevant red flags, detect red flags and indicate what response will take place once a red flag is detected. Data security and phishing breaches must be addressed. Responses can begin with how accounts are monitored and escalate to notifying law enforcement. Senior management has to oversee any Red Flags Rules program. An annual review is required to evaluate the effectiveness of the program. Consumer reporting agencies may implement more fraud alerts, or report address discrepancies or a high number of recent inquiries or new accounts. Documents presented have to be reviewed for suspicious activity such as identification presented not matching an applicant or an application appears to be forged or altered. Addresses and telephone numbers have to be vetted against fraudulent applications, addresses or numbers. Unusual activity may include items such as a creditor receiving a notice of a change of address and then a notice for a lost card to be replaced. Another red flag identified may be when the majority of purchases are for electronics or cash advances. Red flags may also be a change in pattern on the use of your cell phone for cell phone accounts, or a material increase in the use of available credit. What a credit granting or financial institution client is required to do gives the law firm representing them another weapon in defeating possible debtor defenses relevant to identity theft. It will also help you to know why your credit card company may call you when they see a surge in activity outside your home area. If actions don't fit patterns, alerts or red flags are supposed to be in place. Nominations Sought for 2009 Award Of ExcellenceThe Creditors' Rights Section of the Commercial Law League of America is seeking nominations for its Award of Excellence, which was established to recognize outstanding contributions in the field of law affecting creditors' rights. The first recipient of this award, in 2005, was Professor James J. White who, along with Robert Summers, published the most widely recognized treatise regarding the Uniform Commercial Code. The recipient must be a lawyer, legislator, professor of law, or judge, whose work has substantially and positively made an impact on creditors' rights. The recipient will be selected for presentation of the Award at the Annual Meeting of the League held in Chicago in May, 2009. Nomination forms are available at www.clla.org. Calendar of EventsNovember 13 - 16, 2008 April 16 - 19, 2009 |