Regulatory Alerts2010-04-28
Statements in Aid of Interpretation of the Debt Buyer Policy
The Idaho Department of Finance clarifies that unlicensed debt buyers lose their 'No Action' protection if they engage in any collection activity or discussion with consumers. To maintain this position, debt buyers must obtain a license under the Idaho Collection Agency Act whenever they interact with debtors regarding delinquent accounts. Additionally, the policy permits unlicensed debt buyers to utilize attorneys who hold valid collection agency licenses for direct collection efforts without violating the prohibition on direct collection.
Statements in Aid of Interpretation of the Debt Buyer Policy Q. Why does numbered paragraph 2 of the Debt Buyer Policy indicate that if an Idaho consumer calls us or writes to us we lose the Department’s “No Action” position offered in the Debt Buyer Policy? A. Numbered paragraph 2 is intended to convey that a Debt Buyer not holding a license under the Idaho Collection Agency Act cannot engage in any type of collection activity with Idaho consumers/debtors and still qualify for the Department’s “No Action” position. If a Debt Buyer is contacted by debtors against whom it holds delinquent accounts, the Debt Buyer must not engage in any discussion regarding the debt. Otherwise, the Debt Buyer must obtain a license under the Idaho Collection Agency Act. Q. Does numbered paragraph 4 of the Debt Buyer Policy prohibit our company from seeking the services of an attorney to undertake direct collection of payments when that attorney holds a collection agency license under the Idaho Collection Agency Act? A. No. Numbered paragraph 4 is not intended to apply where the attorney is also an authorized licensee under the Idaho Collection Agency Act.