California governor signs legislation on debt collection

State Issues California Debt Collection Consumer Finance State Legislation

On October 4, the California governor signed SB 531, which requires debt collectors to provide more information to consumers when assigned to collect a debt. Among other things, the bill: (i) expands the standards to allow Californians to verify a collector’s authority; (ii) bans creditors from selling the debt without first giving the debtor 30-day notice; (iii) requires debt buyers to provide a written statement to the debtor upon request; and (iv) prohibits, in certain circumstances, a debt collector from making a written statement to a debtor in an attempt to collect a delinquent consumer debt. The law is effective starting July 1, 2022.