Oregon Requires Debt Buyers to be Licensed, Stronger Documentation

Oregon's new licensing and documentation requirements for debt buyers went into effect on October 6, 2017. insideARM reported on this back in July of this year.

These new requirements are specifically for debt buyers, and for debt collectors collecting on behalf of debt buyers.

Documentation Requirements for Legal Action

1. Original creditor's name
• Specifically, the name under which the consumer/debtor initially interacted with that creditor.
2. The name, address, and telephone number of the person/entity currently owning the debt.
3. A statement as to whether or not that person/entity is, or is not, a debt buyer.
4. The last four (4) digits of the original creditor's account number for the debt.
• This is assuming the account number is had more than four (4) digits.
5. A detailed and itemized statement:
• The amount the debtor last paid on the debt -- if the debtor made a last payment -- before charge-off.
• The amount the debtor last paid on the debt -- if the debtor made a last payment -- after charge-off.
• The balance due on the debt on the date the debt was charged off.
• Interest, fees, and additional charges added by the original creditor.
• Interest, fees, and additional charges added by the debt buyer/debt collector.
• Any attorney fees the debt buyer/debt collector is seeking.

NOTE: To collect attorney fees: You have to have prevailed in the legal action, and the original contract the consumer signed has to have a provision for attorney fees.

• Any additional fees the debt buyer/debt collector seeks to collect.
• The date the debt was purchased.

You cannot successfully sue to collect if your agency does not have all of this information. Even if a court grants a judgment, the consumer can petition the court for relief based on non-compliance. 

Unlawful Practices under Oregon Law

1. Using -- or threatening to use -- force or violence to cause physical harm.
2. Threatens arrest or criminal prosecution.
3. Threatens to seize, attach, or sell a consumer/debtor's property if a court order would be necessary to do so, AND also if the debt buyer/debt collector doesn't disclose the necessity of the court proceeding.
4. Uses profane, obscene, or abusive language in communicating with a consumer/debtor.
• Editor's Note: While profane and obscene are easily recognizable, note that "abusive" is a nebulous term
5. Repeated, continual, inconvenient communications with the consumer/debtor, or with the consumer/debtor's family.
• Editor's Note: Again, these are less measurable terms.
6. Communicating with a consumer/debtor's employer about the debt.
7. Communicating with the consumer/debtor at their place of employment if that place of employment is not also the consumer/debtor's home.
• Some exceptions:
• You can write to the place of employment if you do not have a home address at all AND as long as the envelope doesn't disclose that the communication is from a debt collector.
• You can telephone the place of employment to talk only to the consumer AND not reveal to anyone at the place of employment the nature of your communication.
• However:
• A good faith effort must be shown that an attempt was made at the consumer/debtor's home.
• Evening hours are 6.00 p.m. - 9.00 p.m. in the time zone where the consumer resides.
8. Not clearly identifying, in written communications:
• The name of the debt collector
• The name of the company on whose behalf the debt is being collected
• The debt collector's business address
• NOTE: In subsequent written communications, involving multiple accounts, the debt collector can eliminate the name of the company on whose behalf the debt is being collected by substituting the word "various."
9. Not disclosing, on a phone call, within 30 seconds:
• The name of the debt collector calling
• The true purpose of the communication
• NOTE: This does not preclude verifying that you have the correct person on the phone.
10. Concealing the true purpose of the communication -- i.e., spoofing a number that causes the consumer to incur charges for answering.
11. Threatening actions that the debt buyer/debt collector has no intention or ability to follow through on
12. Attempting to disguise written communications as coming from a law firm or court.
13. Misrepresenting fees, interest, attorney fees if there is no legal basis for those fees
14. Attempting to collect more than the balance due in the form of interest and fees if that was not made explicit in the original contract with the creditor
15. Attempting to collect on debt past its statute of limitations 

Licensing

1. Debt buyers cannot collect on Oregon debt without an Oregon license.
2. Applications must be submitted to the Director of the Department of Consumer and Business Services:
• List the applicant's or licensee's name/address and all assumed business names
• List the name and address of the applicant’s or licensee’s registered agent in this state or another person that serves as the applicant’s or licensee’s agent for accepting service of process in this state
• List the names and addresses of the applicant’s or licensee’s directors, members, officers, managers, partners and controllers
• Provide a history of all enforcement actions or administrative, civil or criminal proceedings that involved a failure by the applicant or licensee or a director, member, officer, manager, partner or controller of the applicant or licensee to comply with federal or state law, regulations or rules
• List all instances in which the applicant or licensee had a license, registration or other equivalent authorization to engage in debt buying denied, suspended, conditioned or revoked, unless the revocation was later rescinded, in this or another state
• Disclose for the applicant or licensee and each of the applicant’s or licensee’s directors, members, officers, managers, partners and controllers all violations and arrests and all no contest pleas, guilty pleas and convictions, other than convictions that were later pardoned, in a federal, state, military or foreign court that involved a felony or a misdemeanor, if an element of the misdemeanor was a false statement or dishonesty

The full text of Oregon HB2356 can be found here.

insideARM Perspective

There are no surprises, really, in Oregon's new licensing and documentation law -- but even those agencies not doing business in Oregon should take note of the documentation requirements for chain-of-title with purchased debt. States can be collaborative, and, with consumer protection at the forefront with regards to debt collection, we're likely to see state consolidation into robust documentation needs over bare minimums.

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