TEXAS MINI-MIRANDA NOTICE REQUIREMENT LIMITED TO “THIRD-PARTY DEBT COLLECTORS”

Last week we reported on an amendment to Section 392.304 of the Texas Debt Collection statute, which required a “debt collector” (i.e., a person who directly or indirectly engages in any action, conduct or practice in collecting or in soliciting for collection consumer debts that are due or alleged to be due a creditor) to provide the so-called mini-Miranda notice to debtors. Tex. Fin. Code Ann. § 392.304(a)(5), amended by 2003 Tex. S.B. 533, § 2 (effective Sept. 1, 2003). On October 13, 2003, Texas Governor Rick Perry signed into law Texas House Bill 7, which amends the Section 392.304(a)(5) mini-Miranda notice requirement, making it applicable only to “third-party debt collectors” (i.e., essentially those defined under Section 1692a(6) of the federal Fair Debt Collection Practices Act). Tex. Fin. Code Ann. § 392.304(a)(5), amended by 2003 Tex. H.B. 7, § 28.01 (effective Jan. 11, 2004). The bill also made minor revisions to the content of the required initial disclosure. House Bill 7 takes effect on January 11, 2004, however, until that time, all “debt collectors,” not just “third-party debt collectors,” will be subject to the Section 392.304(a)(5) mini-Miranda disclosure requirements.

Margaret Stolar and Chuck Gall