Missouri Collectors Association Applauds Attorney General Chris Koster's Intent of Preventing Unscrupulous Debt Collection Practices

MCA is reviewing the proposals and wants to work with the Attorney General's office to ensure any new rules create a more consumer-friendly industry in which law-abiding collection agencies can thrive.

Dec 09, 2015, 12:10 ET from Missouri Collectors Association

O'FALLON, Mo., Dec. 9, 2015 /PRNewswire-USNewswire/ -- The Missouri Collectors Association is urging Missouri Attorney General Chris Koster to collaborate with legitimate debt collectors in the state to achieve the shared goals of eliminating bad actors and building a more compliant, consumer-friendly industry.

On December 3, Koster announced plans to reform court rules around debt collection lawsuits. Koster's proposal would require debt collectors to prove at the start of litigation that they have the right to collect the debt in question, limit the circumstances in which courts could grant a default judgment to debt buyers and increase the proof needed for creditors to recover attorney's fees and litigation costs.

At the same time, the Attorney General's office filed additional proposed regulations for the credit and collection industry. The proposed regulations would make it illegal "to file suits on time-barred debt or to try and trick a consumer into unwittingly reaffirming a debt."

"The Missouri Collectors Association is supportive of Attorney General Chris Koster's desire to curb abusive collection lawsuits along with abusive debt collection activity in general," said Nick Jarman, President and COO of Delta Outsource Group, Inc. in O'Fallon, Mo. "Debt collectors primary desire is to resolve delinquent accounts with consumers on a voluntary basis and to leave the legal system out of it.  However, due to increased regulation from a federal and state perspective over the last several years, the ability to communicate with consumers has become extremely difficult and because of that we have seen an increase in lawsuits filed against consumers.  MCA and our members remain focused on consumer protection with the ability to recover rightfully owed debts."

Debt collection is already one of the most extensively regulated industries in the country. Overarching federal regulations address collection activity, and more than 30 states require licensing for debt collection agencies as an added layer of protection.

Legitimate debt collectors are not consumers' enemies and are not interested in a debt that is not owed. In fact, according to data from the Consumer Financial Protection Bureau, of the 75 million consumers with an account in collection, less than 5 percent of them have filed a complaint with the bureau in the last three years.

Also, Missouri debt collectors play a vital role in the state's economy. A 2013 study by Ernst & Young showed that collection agencies returned $1.2 billion in assets to the state's economy. Collection agencies directly employ more than 130,000 Missourians, and the industry as a whole is responsible for more than 230,000 jobs statewide.

MCA has long led the effort to stop criminal debt collection activity and looks forward to the opportunity to work with the Attorney General's office and other regulators to help them understand the complex issues that legitimate debt collectors face.

"The Missouri Collectors Association agrees that unlawful, deceptive or abusive practices should not be tolerated in the industry," Jarman said. "We will continue to review the Attorney General's proposal in the coming weeks and proactively seek opportunities to work with his office to improve upon the ideas already put forward."

Contact
Nick Jarman
President & COO
Delta Outsource Group, Inc.
Phone: (636) 547-2655
nick.jarman@deltaoutsourcegroup.com

 

SOURCE Missouri Collectors Association