AI Voice Agents Stir TCPA Compliance Debate
Could your artificial intelligence-powered voice agents break the law when talking to consumers? Experts behind agentic AI technology in the mortgage space suggest it’s already happening.
The Risks of Agentic AI in Mortgage Lending
The digital voice assistants offered by leading lenders, which help hundreds of thousands of customers weigh home buying options and facilitate monthly mortgage payments, could also run afoul of federal protections against spam calls and other lending laws. Companies like Rocket Mortgage have faced numerous Telephone Consumer Protection Act (TCPA) complaints for allegedly pestering customers, yet none of these lawsuits have specifically attributed unlawful contact to the companies’ AI agents.
However, it isn’t hard for such AI agents to violate the nuances of the law, which carries hefty penalties for each violation. Experts indicate that the risk of noncompliance is high.
How Agentic AI Could Violate TCPA
The Federal Trade Commission does not require consumers to provide extra consent to be contacted by AI, which is treated like an autodialer. Rishi Choudhary, cofounder and CEO of Kastle, emphasizes compliance and states that his company serves some of the industry’s biggest servicers.
To comply with TCPA, companies must ensure:
- Customer consent is obtained.
- Calls do not reach numbers on the National Do Not Call Registry.
- Specific restrictions on calls to landlines versus cell phones are followed.
“Most platforms don’t have that,” said Choudhary, referring to AI companies. “They’re not checking for landlines when they’re making those dials. A lot of those guys have been noncompliant under TCPA.”
Companies could be fined $500 per violation or up to $1,500 if a judge determines the errors were willful or knowing.
The Importance of Tracking Consumer Preferences
The voice agents need to keep track of consumers who request not to be called again. Agentic AI experts advise companies to strengthen their databases to ensure compliance. Mark McKinney, vice president of Market Intelligence and Innovation at Gryphon.ai, suggests involving a compliance agent in the process.
“Before the AI agent actually makes a call, we can do that last mile check to make sure the call doesn’t take place illegally,” he said.
Additional Violations and Risks
While companies like Kastle and Marr Labs audit their agentic AI’s phone calls, some players making calls on behalf of direct-to-consumer lenders lack transparency. Choudhary warns, “That is dangerous, because when the auditor comes you do not have anything to show.”
Another challenge is that AI can “hallucinate,” meaning it may provide inaccurate information, such as offering a consumer an ultra-low mortgage rate. Lenders must ensure that their human-like tools disclose that they are using artificial intelligence, that calls are recorded, and that respondents have the right to opt out.
“Our challenge in technology is to make sure we never have these kinds of errors in our system,” cautioned Grannan.
