Let’s start with some housekeeping issues. First of all, the refunds of AmSher collection fees should be processed in the next few days. We have calculated the refund amounts on all payments through the end of July. Once the program is written and tested is should be an easy matter to run it for each month’s affected payments.

Secondly, many of you will have noticed that some of the issues with the “Collections Statistics” page have been corrected (most noticeably the fact that the last 3 months and lifetime were displaying the same numbers). There is still a problem with how the agency interface updates the statistics table. The good news is that the logic that handles the actual placement and recall is functioning correctly, the problem is strictly in how the status is being updated on the web site. We are currently doing an “account by account” reconciliation and should have all statistics corrected by month end. In conjunction with this effort we are working on a major rewrite of the agency interface. Once completed, this new interface will not only provide additional visibility such “collections exceptions” as having received notice to “cease and desist” or of attorney representation, but should also allow daily files to be sent back and forth with the agencies—currently updates are done on a twice a week basis.

On the legal test, we have filed for “Default Judgment” on the first 20 cases. An additional batch of defaults will be going out next week. The law firm is continuing to work on obtaining “service of process” on the remaining cases. In terms of fallout, we have had 7 accounts file for bankruptcy, two of the accounts have moved out of state, one is deceased and two suits have been contested.

Finally in looking at AmSher’s performance, I remain very pleased with their efforts. One of the key metrics that I look at is what portion of accounts placed with them do they obtain a “right party connect” (meaning that they actually spoke to the debtor) within the first six weeks of placement. AmSher is successfully contacting more than 40% of the debtors. This is extremely good. July was the first month in which dollars collected per account decreased. During my July trip, I reviewed the results across all of AmSher’s portfolios, the decline is happening across the board. This is clearly the sign of a deteriorating economy.

When AmSher gets a debtor on the phone, they first attempt to secure payment for the total delinquent amount due. If the debtor cannot make that large of a payment, they then attempt to secure a payment equal to the monthly amount—to prevent the account from aging another month. During my July visit, I instructed AmSher to fall back to attempting to secure a payment equal to half of the monthly amount—this will at least retard the rate of roll.

On my next trip, we will evaluate the effectiveness of this approach.