Bill Text: FL H1399 | 2011 | Regular Session | Introduced

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Bill Title: Debt Buyers

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [H1399 Detail]

Download: Florida-2011-H1399-Introduced.html

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HB 1399

1	A bill to be entitled
2	An act relating to debt buyers; amending s. 559.55, F.S.;
3	providing a definition for "debt buyer"; amending ss.
4	559.553 and 559.565, F.S.; conforming cross-references;
5	creating s. 559.717, F.S.; providing requirements for debt
6	buyers; requiring a debt buyer to provide a receipt for
7	any payments made by a debtor; providing acts that are
8	prohibited by a debt buyer; providing the requirements for
9	filing an action against a debtor by a debt buyer or for
10	collecting attorney's fees charged for collection
11	services; providing requirements for obtaining a default
12	or summary judgment against a debtor; providing penalties
13	against a debt buyer for violations; providing an
14	effective date.
15
16	Be It Enacted by the Legislature of the State of Florida:
17
18	Section 1.  Section 559.55, Florida Statutes, is reordered
19	and amended to read:
20	559.55  Definitions.-As used in The following terms shall,
21	unless the context otherwise indicates, have the following
22	meanings for the purpose of this part, the term:
23	(4)(1)  "Debt" or "consumer debt" means any obligation or
24	alleged obligation of a consumer to pay money arising out of a
25	transaction in which the money, property, insurance, or services
26	that which are the subject of the transaction are primarily for
27	personal, family, or household purposes, whether or not such
28	obligation has been reduced to judgment.
29	(7)(2)  "Debtor" or "consumer" means any natural person
30	obligated or allegedly obligated to pay any debt.
31	(3)  "Creditor" means any person who offers or extends
32	credit creating a debt or to whom a debt is owed, but does not
33	include a any person who receives to the extent that they
34	receive an assignment or transfer of a debt in default solely
35	for the purpose of facilitating collection of such debt for
36	another.
37	(9)(4)  "Office" means the Office of Financial Regulation
38	of the Financial Services Commission.
39	(1)(5)  "Communication" means conveying the conveying of
40	information regarding a debt directly or indirectly to any
41	person through any medium.
42	(5)  "Debt buyer" means a creditor who is also engaged in
43	the business of purchasing consumer debt for collection
44	purposes, whether it collects the debt itself, hires a debt
45	collector to collect the debt, or hires an attorney to litigate
46	for the collection of the debt.
47	(6)  "Debt collector" means any person who uses any
48	instrumentality of commerce within this state, whether initiated
49	from within or outside this state, in any business whose the
50	principal purpose of which is the collection of debts, or who
51	regularly collects or attempts to collect, directly or
52	indirectly, debts owed or due or asserted to be owed or due
53	another. The term "debt collector" includes any creditor who, in
54	the process of collecting her or his own debts, uses any name
55	other than her or his own which indicates would indicate that a
56	third person is collecting or attempting to collect such debts.
57	The term does not include:
58	(a)  Any officer or employee of a creditor who while, in
59	the name of the creditor, collects collecting debts for such
60	creditor;
61	(b)  Any person while acting as a debt collector for
62	another person, both of whom are related by common ownership or
63	affiliated by corporate control, if the person acting as a debt
64	collector for persons to whom it is so related or affiliated and
65	if the principal business of such persons is not the collection
66	of debts;
67	(c)  Any officer or employee of any federal, state, or
68	local governmental body to the extent that collecting or
69	attempting to collect any debt is in the performance of her or
70	his official duties;
71	(d)  Any person while serving or attempting to serve legal
72	process on any other person in connection with the judicial
73	enforcement of a any debt;
74	(e)  Any not-for-profit organization that which, at the
75	request of consumers, performs bona fide consumer credit
76	counseling and assists consumers in the liquidation of their
77	debts by receiving payments from such consumers and distributing
78	such amounts to creditors; or
79	(f)  Any person collecting or attempting to collect any
80	debt if owed or due or asserted to be owed or due another to the
81	extent that such activity is incidental to a bona fide fiduciary
82	obligation or a bona fide escrow arrangement; concerns a debt
83	that which was originated by such person; concerns a debt that
84	which was not in default at the time it was obtained by such
85	person; or concerns a debt obtained by such person as a secured
86	party in a commercial credit transaction involving the creditor.
87	(2)(7)  "Consumer collection agency" means any debt
88	collector or business entity engaged in the business of
89	soliciting consumer debts for collection or of collecting
90	consumer debts, which debt collector or business is not
91	expressly exempted under as set forth in s. 559.553(4).
92	(10)(8)  "Out-of-state consumer debt collector" means any
93	person whose business activities in this state involve both
94	collecting or attempting to collect consumer debt from debtors
95	located in this state by means of interstate communication
96	originating from outside this state and soliciting consumer debt
97	accounts for collection from creditors who have a business
98	presence in this state. For purposes of this subsection, a
99	creditor has a business presence in this state if either the
100	creditor or an affiliate or subsidiary of the creditor has an
101	office in this state.
102	(8)(9)  "Federal Fair Debt Collection Practices Act" or
103	"Federal Act" means the federal legislation regulating fair debt
104	collection practices, as set forth in Pub. L. No. 95-109, as
105	amended and published in 15 U.S.C. ss. 1692 et seq.
106	Section 2.  Subsection (5) of section 559.553, Florida
107	Statutes, is amended to read:
108	559.553  Registration of consumer collection agencies
109	required; exemptions.-
110	(5)  An Any out-of-state consumer debt collector as defined
111	in s. 559.55(8) who is not exempt from registration under by
112	application of subsection (4) and who fails to register in
113	accordance with this part is shall be subject to an enforcement
114	action by the state as specified in s. 559.565.
115	Section 3.  Section 559.565, Florida Statutes, is amended
116	to read:
117	559.565  Enforcement action against out-of-state consumer
118	debt collector.-The remedies of this section are cumulative to
119	other sanctions and enforcement provisions of this part for any
120	violation by an out-of-state consumer debt collector, as defined
121	in s. 559.55(8).
122	(1)  An out-of-state consumer debt collector who collects
123	or attempts to collect consumer debts in this state without
124	first registering in accordance with this part is subject to an
125	administrative fine of up to $10,000 together with reasonable
126	attorney fees and court costs in any successful action by the
127	state to collect such fines.
128	(2)  Any person, whether or not exempt from registration
129	under this part, who violates s. 559.72 is subject to sanctions
130	the same as any other consumer debt collector, including
131	imposition of an administrative fine. The registration of a duly
132	registered out-of-state consumer debt collector is subject to
133	revocation or suspension in the same manner as the registration
134	of any other registrant under this part.
135	(3)  In order to effectuate this section and enforce the
136	requirements of this part as it relates to out-of-state consumer
137	debt collectors, the Attorney General is expressly authorized to
138	initiate such action on behalf of the state as he or she deems
139	appropriate in any state or federal court of competent
140	jurisdiction.
141	Section 4.  Section 559.717, Florida Statutes, is created
142	to read:
143	559.717  Debt buyers.-
144	(1)  RECEIPT REQUIREMENTS.-If payment is received in cash
145	by a debt buyer from a debtor, an original receipt must be
146	furnished by the debt buyer to the debtor showing:
147	(a)  The name of the creditor for whom the payment is
148	collected, the account number assigned by the creditor, and, if
149	the current creditor is not the original creditor, the account
150	number assigned to the debt by the original creditor;
151	(b)  The amount and date paid;
152	(c)  The name of the person accepting payment; and
153	(d)  A clear statement of whether the payment is accepted
154	as payment in full or a full and final compromise of the debt,
155	or if not, the balance due after payment is credited.
156	(2)  PROHIBITED ACTS.-A debt buyer may not bring suit or
157	initiate an arbitration proceeding against the debtor, or
158	otherwise attempt to collect on the debt:
159	(a)  If the debt buyer knows, or reasonably should know,
160	that such collection is barred by the applicable statute of
161	limitations or the debt has been discharged in bankruptcy;
162	(b)  Without valid documentation that the debt buyer is the
163	owner of the debt instrument or account at issue and reasonable
164	substantiation by admissible evidence and verification of the
165	amount of the debt owed by the debtor. For purposes of this
166	paragraph, reasonable substantiation by admissible evidence and
167	verification requires:
168	1.  Documentation of the identity of the original creditor
169	by providing a copy of the original written contract between the
170	original creditor and debtor, or, if there is no written
171	contract, the original application for credit by the debtor, or
172	other writing evidencing the original debt, which must contain
173	the debtor's signature. If a claim is based on credit card debt
174	or other revolving debt or open account and a signed writing
175	evidencing the original debt does not exist, copies of each of
176	the documents generated when the credit card was used or the
177	items charged must be attached;
178	2.  The name and address of the debtor as it appears in the
179	original creditor's records;
180	3.  The debtor's original account number;
181	4.  A life-of-the-debt itemized accounting of the amount
182	owed, including all interest, fees, and charges and all
183	payments, refunds, and credits;
184	5.  If there is an arbitration agreement, a valid, signed
185	agreement to arbitrate the type of claim which is the subject of
186	the arbitration; and
187	6.  If equitable relief is sought, documentation evidencing
188	the amount paid for the debt by the debt buyer; and
189	(c)  Without first giving the debtor written notice of
190	intent to file a legal action at least 30 days before filing the
191	notice. The notice must include the name, address, and telephone
192	number of the debt buyer; the name of the original creditor and
193	the debtor's original account number; a copy of the original
194	written contract or other document evidencing the original debt;
195	and a life-of-the-debt itemized accounting of all amounts
196	claimed to be owed.
197	(3)  COMPLAINT AGAINST DEBTOR.-In any cause of action
198	initiated by a debt buyer, all of the following must be attached
199	to the complaint, which must be verified under oath:
200	(a)  A copy of the contract or other writing evidencing the
201	original debt, which must contain the defendant's signature. If
202	there is no written contract, the original application for
203	credit by the debtor or other writing evidencing the original
204	debt, which must contain the debtor's signature. If a claim is
205	based on credit card debt or other revolving debt or open
206	account and a signed writing evidencing the original debt does
207	not exist, copies of each of the documents generated when the
208	credit card was actually used or the items charged must be
209	attached.
210	(b)  A copy of the assignment and all attachments
211	referenced therein relating to the debt or other writing
212	establishing that the plaintiff is the owner of the debt and a
213	copy of all notices of assignment sent to the debtor. If the
214	debt has been assigned more than once, each assignment and all
215	attachments referenced therein relating to the debt or other
216	writing evidencing transfer of ownership and establishing an
217	unbroken chain of ownership must be attached. Each assignment or
218	other writing evidencing transfer of ownership must contain the
219	debtor's original account number and clearly show the debtor's
220	name associated with that account number.
221	(4)  ATTORNEY'S FEES AND COSTS.-If attorney's fees are
222	charged for collection services rendered to a debt buyer, all of
223	the following materials setting forth a party's obligation to
224	pay the fees must be provided to the court before a court may
225	enforce those provisions:
226	(a)  A copy of the contract or other writing evidencing the
227	original debt, which must contain the defendant's signature. If
228	a claim is based on credit card debt and a signed writing
229	evidencing the original debt does not exist, copies of each of
230	the documents generated when the credit card was used must be
231	attached.
232	(b)  A copy of the assignment and all attachments
233	referenced therein relating to the debt or other writing
234	establishing that the plaintiff is the owner of the debt. If the
235	debt has been assigned more than once, each assignment and all
236	attachments referenced therein relating to the debt or other
237	writing evidencing transfer of ownership and establishing an
238	unbroken chain of ownership must be attached. Each assignment or
239	other writing evidencing transfer of ownership must include the
240	debtor's original account number and clearly show the debtor's
241	name associated with the account number.
242	(c)  A verified copy of the fee agreement between the
243	attorney seeking fees and the debt buyer, documenting the amount
244	of fees payable by the debt buyer to the attorney for collection
245	services.
246	(d)  Documentation of each item of costs claimed as
247	recoverable, including the source of each cost and the invoice
248	for the cost.
249	(5)  DEFAULT OR SUMMARY JUDGMENT AGAINST A DEBTOR.-
250	(a)  Before entry of a default judgment or summary judgment
251	against a debtor in a verified complaint initiated by a debt
252	buyer, the plaintiff must file competent, admissible evidence
253	with the court to establish the amount and nature of the debt.
254	(b)  The only evidence sufficient to establish the amount
255	and nature of the debt are properly authenticated business
256	records that satisfy Rules 90.803(6) and 90.901, Florida Rules
257	of Evidence. The authenticated business records must, at a
258	minimum, include all of the following:
259	1.  The date of the origination of the debt.
260	2.  The original account number.
261	3.  The original creditor.
262	4.  The amount of the original debt or, if the debt
263	involves open-end credit, the initial credit limit.
264	5.  A life-of-the-debt itemization of charges and fees owed
265	and all payments, refunds, and credits and an explanation of how
266	the outstanding balance was calculated.
267	6.  If the debt has been charged off, the original charge-
268	off balance.
269	7.  An itemization of post charge-off additions, if
270	applicable.
271	8.  The date of assignment or purchase by the debt buyer
272	and the outstanding balance at that time.
273	9.  The date and amount of last payment, together with
274	independent documentation thereof.
275	10.  The amount of interest claimed throughout the
276	transaction and the basis for the computation of the interest
277	charged.
278	(6)  VIOLATIONS BY DEBT BUYER.-
279	(a)  Any debt buyer who violates any provisions of this
280	section is liable to the debtor for statutory damages in the
281	amount of the purported debt or $1,000, whichever is smaller,
282	for each such violation, or, if a class action lawsuit is
283	brought under this section, the lesser of 1 percent of the net
284	worth of the debt buyer or $500,000, and actual damages,
285	punitive damages, reasonable attorney's fees and costs, and
286	appropriate equitable relief. The remedies provided in the
287	paragraph are cumulative and in addition to any other remedies
288	available.
289	(b)  An action brought under this subsection must be
290	commenced within 2 years after the date on which the alleged
291	violation occurred.
292	Section 5.  This act shall take effect July 1, 2011.

CODING: Words stricken are deletions; words underlined are additions.