Utah repeals some collection agency registration requirements

Licensing State Issues State Legislation Utah Debt Collection

On March 17, the Utah governor signed HB 20 to repeal several of the state’s collection agency statutory provisions. Specifically, the bill repeals provisions that (i) require collection agencies to register with the Division of Corporations and Commercial Code and have on file sufficient bond in the amount of $10,000 (see Sections 12-1-1 and 12-1-2); (ii) stipulate bond terms and require certain records relating to registrations and bonds to be maintained with the Division and open to public inspection (see Sections 12-1-3, and 12-1-5); (iii) relate to violations and penalties and specify that “[a]ny person, member of a partnership, or officer of any association or corporation who fails to comply with any provision of this title is guilty of a class A misdemeanor (see Section 12-1-6); (iv) outline exceptions (see Section 12-1-7); (v) govern assignments of debts involving collection agencies and limit activities as to the assignments (see Section 12-1-8); (vi) specify that information about a consumer’s credit rating or credit worthiness sent to a consumer reporting agency is void if the collection agency does not have a bond on file (see Section 12-1-9); and (vii) require certain registration forms and application fees for collection agencies seeking approval to conduct business in Utah (see Section 12-1-10). Limitations and terms of collection fees and convenience fees imposed by creditors or third-party debt collection agencies will remain unchanged by the amendments (see Section 12-1-11). The changes take effect May 3.