Office of the Commissioner of Financial Regulation

 

Collection Agencies Licensees 07-06 - Advisory Notices

 

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July 17, 2007

Please be advised that effective October 1, 2007 any person engaged in the collection of a consumer claim the person owns, if the claim was in default when the person acquired it is required to be licensed as a collection agency pursuant to HB 1324 which was signed by Governor Martin O'Malley on May 8, 2007.
This legislation which is Chapter 472 of the Laws of Maryland 2007 will amend the definition of "collection agency" as it relates to the licensing and regulation of persons collecting consumer claims in Maryland. With certain exceptions, Maryland law currently requires that persons who collect consumer claims for third parties to be licensed as collection agencies by the State Collection Agency Licensing Board. As of October 1, 2007, the licensing requirement will also apply to "debt acquirers"- that is persons who engage in the business of purchasing and collecting delinquent debts. The new expanded requirement applies to persons who are directly collecting claims that they own, but only if they were in default when the owner acquired the claims. The full text of Chapter 472.

HB 1324 closes a loophole in licensing of debt collectors under Maryland law and also establishes specific qualifications for a collection agency license, including conditions under which the Board may reprimand, suspend or revoke a license. The amended law directly affects the following statutes:

Business Regulation Article §7-101, §7-303 and §7-308

If there are any questions with relation to your organization and any exemption for which you may be entitled, please feel free to contact the Commissioner of Financial Regulation at (410) 230-6097. To apply for the required license you may apply on line at the Financial Regulation website .

This Board strongly encourages all collection agencies businesses to review the new requirements imposed by Chapter 472 with their counsel to assure compliance.