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SF 2820

as introduced - 88th Legislature (2013 - 2014) Posted on 03/21/2014 08:32am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to debt collection; requiring that a debt collection agency or an individual
debt collector create and maintain certain records of its contacts with alleged
debtors; amending Minnesota Statutes 2012, section 332.37.


Section 1.

Minnesota Statutes 2012, section 332.37, is amended to read:


No collection agency or collector shall:

(1) in collection letters or publications, or in any communication, oral or written
threaten wage garnishment or legal suit by a particular lawyer, unless it has actually
retained the lawyer;

(2) use or employ sheriffs or any other officer authorized to serve legal papers in
connection with the collection of a claim, except when performing their legally authorized

(3) use or threaten to use methods of collection which violate Minnesota law;

(4) furnish legal advice or otherwise engage in the practice of law or represent that
it is competent to do so;

(5) communicate with debtors in a misleading or deceptive manner by using the
stationery of a lawyer, forms or instruments which only lawyers are authorized to prepare,
or instruments which simulate the form and appearance of judicial process;

(6) exercise authority on behalf of a creditor to employ the services of lawyers
unless the creditor has specifically authorized the agency in writing to do so and the
agency's course of conduct is at all times consistent with a true relationship of attorney
and client between the lawyer and the creditor;

(7) publish or cause to be published any list of debtors except for credit reporting
purposes, use shame cards or shame automobiles, advertise or threaten to advertise for
sale any claim as a means of forcing payment thereof, or use similar devices or methods
of intimidation;

(8) refuse to return any claim or claims and all valuable papers deposited with a
claim or claims upon written request of the creditor, claimant or forwarder after tender
of the amounts due and owing to the agency within 30 days after the request; refuse or
intentionally fail to account to its clients for all money collected within 30 days from the
last day of the month in which the same is collected; or, refuse or fail to furnish at intervals
of not less than 90 days upon written request of the claimant or forwarder, a written report
upon claims received from the claimant or forwarder;

(9) operate under a name or in a manner which implies that the agency is a branch
of or associated with any department of federal, state, county or local government or
an agency thereof;

(10) commingle money collected for a customer with the agency's operating funds
or use any part of a customer's money in the conduct of the agency's business;

(11) transact business or hold itself out as a debt prorater, debt adjuster, or any
person who settles, adjusts, prorates, pools, liquidates or pays the indebtedness of a debtor,
unless there is no charge to the debtor, or the pooling or liquidation is done pursuant to
court order or under the supervision of a creditor's committee;

(12) violate any of the provisions of the Fair Debt Collection Practices Act of 1977,
Public Law 95-109, while attempting to collect on any account, bill or other indebtedness;

(13) communicate with a debtor by use of a recorded message utilizing an automatic
dialing announcing device unless the recorded message is immediately preceded by a live
operator who discloses prior to the message the name of the collection agency and the
fact the message intends to solicit payment and the operator obtains the consent of the
debtor to hearing the message;

(14) in collection letters or publications, or in any communication, oral or written,
imply or suggest that health care services will be withheld in an emergency situation;

(15) when a debtor has a listed telephone number, enlist the aid of a neighbor or
third party to request that the debtor contact the licensee or collector, except a person who
resides with the debtor or a third party with whom the debtor has authorized the licensee
or collector to place the request. This clause does not apply to a call back message left at
the debtor's place of employment which is limited to the licensee's or collector's telephone
number and name;

(16) when attempting to collect a debt, fail to provide the debtor with the full name
of the collection agency as it appears on its license;

(17) collect any money from a debtor that is not reported to a creditor or fail to
return any amount of overpayment from a debtor to the debtor or to the state of Minnesota
pursuant to the requirements of chapter 345;

(18) accept currency or coin as payment for a debt without issuing an original receipt
to the debtor and maintaining a duplicate receipt in the debtor's payment records;

(19) attempt to collect any amount of money from a debtor or charge a fee to a
creditor that is not authorized by agreement with the client;

(20) falsify any collection agency documents with the intent to deceive a debtor,
creditor, or governmental agency; deleted text beginor
deleted text end

(21) when initially contacting a Minnesota debtor by mail, fail to include a disclosure
on the contact notice, in a type size or font which is equal to or larger than the largest other
type of type size or font used in the text of the notice. The disclosure must state: "This
collection agency is licensed by the Minnesota Department of Commercedeleted text begin.deleted text end"new text begin; or
new text end

new text begin (22) when contacting an alleged or suspected debtor in connection with a specific
debt, fail to add to its file on the debt a notation providing the name and contact
information of the alleged or suspected debtor and whether the alleged or suspected debtor
acknowledged or denied the debt. If the creditor or an assignee subsequently terminates its
contract with the debt collection agency, or vice versa, the debt collection agency must
provide to the creditor or the creditor's assignee, in writing, the debt collection agency's
information referenced in this paragraph, no later than 30 days after the termination. If
the creditor or the creditor's assignee subsequently retains one or more other collection
agencies for the purpose of collecting the debt, those other collection agencies must not
request, demand, or require the alleged debtor to again acknowledge or deny the debt.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2014, and applies to
contacts with alleged debtors on or after that date.
new text end