Creating and Identifying a High-Performance Recovery Culture

1. Creating and Identifying a High-Performance Recovery Culture Scott Lindley Executive Vice President Client Services, Inc.

2. Topics Account Activation Performance KPI’s Scoring, Segmentation & Analytics Culture • Things to Think of… • Important questions to understand? • Real World • Examples of what leading providers are doing. • Take-Away • Things to try when you get back to your office.

3. Things to Think of? -Is account activity tracked? Do you have set work standard for account activation? What are they? How many total accounts are worked each day? How many accounts are timed for daily follow-up? How many calls per week per account? How often is the entire inventory worked? How often are the accounts audited to gauge compliance with work standards? -What is the collector-to-account ratio? -How many weekend calls per month per account? -How many evening and early morning call attempts per week? -What kind of skiptracing tools are being utilized on your business? -Do you have a letter campaign? -What is your “right-party” contact percent? Account Activation “It’s a Numbers Game”

4. Account Activation “It’s a Numbers Game” • Real World Example Activation • All accounts activated within 48-72 hours • Contact attempts • Blended approach Take-Away= Get a report from your provider on their activation/penetration rates.

5. Performance Metrics • Things to Think of? • Create Accountability! • Collection Result Tracking • P2P, PDCK, NSF • Promise Boards • Set Daily/Weekly/Monthly Goals • Dollars Collected • Skiptracing Results • No Promise Transfers/2nd Voice • Activation • Contacts

6. Performance Metrics Real World Example

7. Performance Metrics Real World Example Take-Away= Set performance goals with Daily/Weekly/Monthly benchmarks.

8. Scoring, Segmentation and Analytics • Things to Think of… • Not all accounts are the same, not all employees are the same. Understand what analytical tools are available to you internally and leverage your staff accordingly. • Do you have the right resources on the right accounts? • Do you segment accounts based on type/balance/age? • Can you identify accounts with a high propensity to pay? • Do you segment your employees based on results, work ethic and attitude? • Are you using every internal resource to collect prior to using a 3rd party? • How does your current vendor score and segment accounts? • What attributes are used in their scoring metrics? • What strategy changes do they make for each scoring tranche?

9. Scoring and Analytics Real World Example Segmenting accounts into a scoring tranche 20-25% / 30% 50-65% / 30% 10% / 40% Better Best Good

10. Scoring and Analytics • Real World Example • Utilizing Skill Based Routing & IVR • Call-ins • Dialer Activity • Manual Activity IVR Technology Good Inventory Better Inventory Best Inventory 3’s 2’s 1’s Good Agents Better Agents Best Agents

11. Culture/Environment 5 major components needed to create a successful collection culture; Recruitment Can you locate and retain quality employees? Training Are you giving your employees what they need to be successful? Incentives/Recognition Programs Are your employees motivated? Compliance Are you collecting within the guidelines of the law? Environment or

12. Recruitment Things to Think of… Do you/they have a dedicated recruitment department? What sources are used? What qualifications do you look for? What is your retention/attrition rate? Real World Example • Recruitment Sources: • Referrals • Newspaper Ads • Internet Employment Sites • Monster • Careerbuilder • Job Fairs • Radio Ads • Open Houses • Billboards • Qualifications: • Experience • Stability • Strong Work Ethic • Positive Attitude • Trainability • Active Listeners Take-Away= Track the success of each recruitment source

13. Training Things to Think of… How long is the initial training program? Do ALL employees attend? What topics are covered? Is there follow-up training, goals and action plans? Are trainees in a segregated area? Are trainers part of a dedicated staff? Real World Example • ACA Certified Trainers • Ongoing Training Program • Mentoring Program • Collector Development Program • ACE Program

14. Training Real World Example Our employee mission is founded on creating the ultimate corporate culture by providing our employees with the tools and knowledge to maximize productivity, enhance the corporate climate and develop organizational and personal skills. Week 1 -Overview of the Company/Industry -Mastering the FDCPA -Importance of Compliance -Efficiently Operating CUBS system -Introduction to Talk Off -Third Party Probing Week 2 -Generating Contacts -Objections and Rebuttals -Implementation of CSI scripts -File Mechanics -FDCPA Review -First Week of Actual Collection Calls Week 3 -Generating contact numbers -Credit Bureau Reading -Identifying Hot Accounts -Demand and Negotiation Training -Group Review of Calls -FDCPA final test

15. Incentive/Recognition Programs Things to Think of… Do you have incentive programs? “Promise boards” “Hot account follow up” Do you host employee events/contests? If you have a vendor, have you seen their facility? Meet their staff Spend time on the collection floor Ask the tough questions Real World Example Collector Motivation Monthly Medallions Quarterly Trophies Top ACE Award Collector Advisory Board Collector Bonus Plan

16. Compliance Things to Think of… CFPB is coming!!!! Heightened media attention 2005 – 4,452 FDCPA/FCRA Lawsuits 2006 – 4,757 FDCPA/FCRA Lawsuits 2007 – 5,847 FDCPA/FCRA Lawsuits 2008 – 7,325 FDCPA/FCRA Lawsuits 2009 – 10,314 FDCPA/FCRA Lawsuits 2010 – 11,578 FDCPA/FCRA Lawsuits Credit & Collection Lawsuits

17. Compliance Real World Example ‘A’ Rating with the BBB! Democrat/Republican Attorney General Assoc. Missouri Attorney General Collectors Pledge “I believe every person has worth as an individual. I believe every person should be treated with dignity and respect. I will make it my responsibility to help consumers find ways to pay their just debts. I will be professional and ethical. I will commit to honoring this pledge.”

18. Compliance Real World Example Dedicated Consumer Affairs Dedicated Quality Assurance Recording Systems Website/Complaint Prevention System Safeguards

19. Compliance Real World Example If a state law restriction exists, an alert displays on the account in the corner of the screen.   Sensitive information such as the social security number and client account number are masked on the face screen.

20. Compliance Real World Example Democratic/Republican Attorney General Association -Developing relationships with regulatory bodies is a key initiative as we look to gain traction in reshaping our industry’s perception. Legal/Regulatory Affairs Department Consumer Affairs Department Quality Assurance Department -Increasing staff to facilitate an increase in call monitoring from 4 to 20 call monitors per month per agent. Call Recording Systems* Verint Recording System -Records all inbound and outbound calls. Aspect Recording System -Records all inbound and outbound calls routed through our dialer. *Each system provides graphical key metric analysis for both agent and enterprise trends. Call Miner Voice Analytics Software -Systemic call analysis of key words, phrases, tone and voice inflection. Standardized Complaint Handling and Escalation Protocol Monthly Legal Affairs Meetings – President, Management, Legal Affairs, and Consumer Affairs -Review in detail at the account level any regulatory complaints, complaints reported by clients or lawsuits, including threatened lawsuits, received the previous week.

21. Compliance Weekly Q/A Compliance Meetings - President, Executive Management and Q/A -Review of calls not meeting industry standards and ensure corrective/disciplinary action is taken. Monthly VP Complaint Prevention Meeting with Collection Staff -Reinforcement of corporate policies and standards, as well as legislative updates and compliance findings. Quarterly Legal Affairs Update from Legal/Regulatory Affairs Department with Collection Staff -Reinforcement of critical topics covered in the monthly VP complaint prevention meetings, including updates on relevant regulatory and legislative changes. Compliance Oriented Collection Notices -Provides consumers with instructions on how to reach our dedicated consumer affairs department via our website or toll-free phone number. CSINet -Proprietary Call Center Management System with Required Reading/Electronic Signature for all compliance related communications. Collection System -Consumers located in states that have more restrictive laws than the FDCPA have a systemic safeguard which displays the specific state law for collector review before initiating contact. Website -Online access for consumers to register a complaint directly with consumer affairs department.

22. Compliance New Hire Selection Process/Training Recruitment Process and Background Screening -In-depth screening for felonies, crimes of dishonesty or crimes of violence. Three-Week Comprehensive New Hire Training Collector Development Program The Mentor Program Scripted Consumer Interactions Align Incentives/Penalties with Customer Experience Zero Tolerance Policy -Disciplinary actions imposed for any infraction related to poor consumer treatment, FDCPA and/or company policy violations. Penalties are levied against collectors and all levels of management, including removal from project, suspension, bonus penalties & termination. Strict Adherence to the ACA Sponsored Collectors Pledge -ACA sponsored pledge outlining the belief that EVERY consumer should be treated with dignity and respect. World Class Call Recognition Program -Through our call recording systems we will identify calls that qualify as World Class and provide recognition and incentives to collectors who achieve this excellence. Achieving Collection Excellence (ACE) Incentive Program -A recognition incentive program for collectors who display performance and compliance excellence. -ACE recipients receive monthly recognition, a spot on our Collector Advisor

23. Compliance Real World Example • SAS 70 Type II Certified • ISO-27001 and ISO-27002 • Overall rating of “1 – Strong” (the highest) • PCI Level-1 (the most stringent) certified the past five years • Security of Facility • Badge Access • Video Monitoring • Segregated Environments • Customer Data Security •  Role based access Network monitoring  System safeguards

24. Culture Take-Aways... • Do you/they have a dedicated recruitment department? • What qualifications do you look for? • Ask for a copy of your current vendor training manual/program. • How long is the initial training program? • What topics are covered? • Are trainees in a segregated area and are trainers dedicated? • Educate your staff on talk-offs, payment options and negotiation training. • Set monthly goals & action plans. • How do you/they motivate employees? • Host employee events/contests. • If using a vendor, have you seen their facility? • Meet with the staff working your accounts. • Find out what your vendors BBB rating is? • What steps do you/they do internally to mitigate liability? • Get YOUR eyes on their facility!

25. Change in economy & industry… Vendors are eliminated due to experience Identifying partners who match up with your goals

26. 24 Years of Recovery Excellence and Experience • Financial Stability • Honesty - Integrity – Loyalty • Corporate Mission to Provide the Best Services • Industry Best Recovery Results • Flawless Integration • Limitless Reporting Capabilities • PCI and ISO Certified at the Highest Levels • Dedicated Staff • Cost Effective Scott Lindley Executive Vice President 636.255.3330 scott.lindley@clientservices.com