COLORADO RULES IMPLEMENT NEWLY ENACTED LAW REQUIREMENTS
The Colorado Collection Agency Board recently issued new and amended rules, effective July 30, 2010, implementing the requirements of Colorado H.B. 10-1222, which became effective July 1, 2010. Colorado House Bill 10-1222 amended the Colorado Fair Debt Collection Practices Act’s existing local office requirement to require collection agencies licensed under the Colorado FDCPA to accept payments physically made at the office for any debt the agency is attempting to collect. Under existing Section 12-14-123(1)(b) of the Colorado FDCPA, the local office also must (i) be open to the public during normal business hours, (ii) be staffed by at least one full-time employee and (iii) maintain a record of all moneys collected and remitted by the agency for residents of Colorado. In addition to the requirement to accept payments physically, H.B. 10-1222 requires licensees to notify, in each written communication, the consumer from whom the agency is attempting to collect a debt of the address and telephone number of the local office.
New Rule 1.09 provides that a collection agency may satisfy the local Colorado office requirement of Section 12-14-123(1)(b) by contracting with a third-party if the third-party:
- Maintains an office in Colorado open to the public during normal business hours that may be a shared office location if signs or directories are posted or displayed listing all collection agencies for whom the third-party provides a local Colorado office;
- Maintains at that office records, or free and easy access to records, of all moneys collected and remitted for Colorado residents;
- Accepts payments physically made at that office for any debt the agency is attempting to collect;
- Staffs that office with a full time employee who may be a shared employee;
- Provides a telephone number that may be a shared telephone number, that rings to the local Colorado office, and is answered in a manner that does not mislead consumers; and
- Complies with all applicable provisions of the Colorado FDCPA.
The Rule also provides that a collection agency that uses a third-party to provide a local Colorado office is responsible for actions of the third-party that violate the Colorado FDCPA. The Colorado Collection Agency Board in its statement of purpose of the rules indicates that it has allowed a shared office under existing rules, and by practice has allowed shared employees and access to records. It indicates that new Rule 1.09 clarifies these practices and standardizes them by authorizing them by rule rather than practice.
The Board addressed H.B. 10-1222’s new notice requirements by amending existing Rules 2.01 and 2.15 to require disclosure of the address and telephone number of the collection agency’s local Colorado office.
Collection agencies licensed under the Colorado FDCPA should review their existing practices to ensure compliance with the new requirements.
- Mike Tomkies and Margaret Stolar
NYC CLARIFIES RULES IN LETTER TO INDUSTRY TRADE GROUPS
The New York City Department of Consumer Affairs has issued a letter to DBA International and ACA International regarding industry concerns about final rules implementing Local Law No. 15. See our previous Alerts dated March 17, 2009 and April 16, 2010, discussing Local Law No. 15 and the final rules. In its letter, the DCA addressed the industry concerns, which included:
- Clarification of the definition of “communication” in Section 20-493.1: it means the same as in 15 U.S.C. Section 1692a(2), to the extent such communication is permitted by other City, State and/or Federal law, and includes any voice mail message, e-mail or text message;
- Whether under Section 20-493.1(a)(ii), a debt collection agency may use a d/b/a or other business name registered with the New York Secretary of State or the DCA in any permitted communication: only if it is contained in the debt collection agency’s application for a license from the DCA;
- Whether Section 20-493.1(a)(iv) only applies only to oral communications initiated by an individual debt collector to a consumer: no, to all permitted communications;
- Whether under Section 20-493.1(a)(iv), the first written communication between a debt collection agency and a consumer must give the name of a person to call back: yes;
- Whether that section permits the use of an alias: yes, subject to certain conditions and limitations;
- Whether Section 20-493.1(a)(v) requires a debt collection agency to provide accurate information concerning the amount of the debt when actually and directly speaking with the consumer: yes, in any permitted communication, written or oral;
- What level of accuracy is required by Section 20-493.1(a)(v): the amount must be the total amount of the debt at the time of the communication, including interest and fees; and
- Whether Section 2-193 applies only to calls made to consumers located in NYC: yes. If you would like a copy of the letter, please let us know.
- Mike Tomkies and Margaret Stolar