Commercial-Debt Collection Statutes for IDAHO:
As used in this act:
(1) “Agent” means any person who, for compensation or gain, or in the expectation of compensation or gain, contacts persons in Idaho in connection with the business activities of a licensee or person required to be licensed under this act.
(3) “Collection activities” means the activities enumerated in subsections (2) through (6) of section 26-
2223, Idaho Code.
(4) “Collection agency” means a person who engages in any of the activities enumerated in subsections
(2) through (6) of section 26-2223, Idaho Code. (see below)
(14) “Person” means any individual, corporation, association, partnership, limited liability partnership, trust, company, limited liability company, or unincorporated association. Idaho Code Ann. § 26-
2222(1), (3)-(4), (14) (West, WESTLAW through H.B. 451, 59th Leg., Reg. Sess. (Idaho 2008)).
(2) Engage, either directly or indirectly, in this state in the business of collecting or receiving payment for others of any account, bill, claim or other indebtedness.
(3) Solicit or advertise in this state to collect or receive payment for another of any account, bill, claim or other indebtedness.
(4) Sell or otherwise distribute in this state any system or systems of collection letters or similar printed matter where the name of any person other than the particular creditor to whom the debt is owed appears. (5) Engage in any activity in this state which indicates, directly or indirectly, that a third party is or may be involved in effecting any collections.
(6) Engage or offer to engage in this state, directly or indirectly, in the business of collecting any form of indebtedness for that person’s own account if the indebtedness was acquired from another person and if the indebtedness was either delinquent or in default at the time it was acquired. Idaho Code Ann. § 26-
2223(2)-(6) (West, WESTLAW through H.B. 451, 59th Leg., Reg. Sess. (Idaho 2008)).
What is the Fair Debt Collection Practices Act?
The U.S. Congress enacted the FDCPA in 1977 and added it to the Consumer Credit Protection Act in 1978. Its purpose is to eliminate abusive practices of third-party debt collectors. To that end, the Act establishes guidelines for the conduct of debt collectors, defines the rights of consumers, and prescribes penalties for violations.
The FDCPA defines “debt collectors” as “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debt … asserted to be owed or due another.”
In other words, “debt collectors” are defined as third parties collecting for a creditor. (As of a 1986 amendment, the FDCPA definition of “debt collector” also includes attorneys who collect debts on a regular basis.)
“Consumers” and “debt” covered under the FDCPA are defined as specifically referring to personal, family or household transactions. Therefore, debts owed by businesses or by individuals for business purposes (commercial debts) are not subject to the FDCPA.
So, if the FDCPA does not apply to commercial debt collection by third parties, how are commercial collectors regulated?
There are no U.S. federal laws, similar to the FDCPA, that regulate third-party commercial (business-to-business) debt collection or provide guidelines for the conduct of commercial debt collectors.
Who is protecting the rights of commercial creditors and debtors?
Commercial Collection Agency Association
The premier body governing the activities of commercial debt collectors is the Commercial Collection Agency Association (CCAA), an arm of the Commercial Law League of America (CLLA). These organizations are not government bodies, nor do they have any jurisdiction over non-members. However, both require high standards of practice and ethics in order for a commercial collection agency to become a certified member.
The Commercial Collection Agency Association was established in 1972 to “improve the quality and reputation of the commercial collection industry.” It currently has more than 200 members. Approximately 100 core members represent the most prestigious commercial collection agencies in the United States.
The CCAA is an arm of the Commercial Law League of America (CLLA), the oldest creditor’s rights organization in the country established in 1895.
Membership in the CCAA
Members of the CCAA are the only collection agencies in the United States certified by the Commercial Law League of America. In order to obtain certification, the agency must meet rigorous criteria.
- The agency must have been in business at least four years prior to application for membership.
- 80% of the agency’s business must be commercial (business-to-business).
- The agency must maintain a separate Trust Account into which all monies belonging to creditors are placed. This Trust Account is reviewed twice annually by the Executive Director of the CCAA.
- The agency must agree to abide by the CCAA Code of Ethics, which sets ethical standards for dealing with creditors, debtors and attorneys.
- Executives of the agency must meet continuing educational requirements and attend regular CCAA meetings. The member agency must complete sixty continuing educational credits annually.
- The agency must post a surety bond of at least $300,000 for the protection of the creditors it serves.
- One person in the agency must also be a member of the Commercial Law League of America.
- The agency must agree to random periodic site visits from the CCAA Executive Director.
- The agency must be in compliance with all local and state licensing requirements and regulations governing commercial collection firms.
Primarily, the Commercial Law League of America and its Commercial Collection Agency Association have assumed responsibility for looking after the needs and rights of creditors and their customers/debtors. State governments that require licensing and bonding of commercial debt collectors also play an important role.
However, since membership in the CCAA is not compulsory, and some firms may provide collection services in a state but never get licensed, it is up to creditors to ensure they (and their debtors) are receiving the most ethical and highest level of commercial collection service.
How? Check to see if your Agency is both a member of the Commercial Collection Agency Association and therefore certified by the Commercial Law League of America, and is licensed in the U.S. states requiring such licensing.
Burt And Associates is a member of both CCAA and CLLA. Also, we are licensed in bonded in all 50 states (where required).