Regulation of collection agencies

[lopez]

Hai,

I am Lopez.

United States
Regulation of collection agencies occurs primarily at the individual state level as most states require collection agencies be licensed and/or bonded. In addition, many states have laws regulating debt collection, which agencies must adhere to (see Fair debt collection).

The Fair Debt Collection Practices Act is the primary United State Federal law governing debt collection practices. The FDCPA allows aggrieved consumers to file private lawsuits against a collection agency that violates the Act. Alternately, the Federal Trade Commission or the state Attorney-General may take action against a noncompliant collection agency, including issuing fines, ordering damages, restricting its operations or even closing it down (see, e.g. CAMCO).

The FDCPA specifies that if a state law is more restrictive than the federal law, the state law will supersede the federal portion of the act. Thus, the more restrictive state laws will apply to any agency that is located in that state or makes calls to debtors inside such a state.

Canada
In Canada regulation is provided by the province or territory in which they operate. The law is typically called the Collection Agencies Act and usually affords a government ministry power to make regulations as needed. However, the regulations typically limit the agency to three contacts with the debtor per 7 day period. Further, a debtor should not be contacted unless they have been notified in writing first that the debt has been assigned to the agency making the contact. Most debts in Ontario, Canada are subject to a limitation period of two years. After the second anniversary of the last formal intention to pay the debt, the collection agency nor anyone else has authority to collect it.