Commercial-Debt Collection Statutes for:
(a) As used in this act:
(ii) “Business debt” means the obligation arising from a credit transaction between business or commercial enterprises for goods or services used or to be used primarily in a commercial or business enterprise and not for personal, family or household purposes;
(iii) “Collection agency” means any person who:
(A) Engages in any business, the purpose of which is the collection of any debts for
(B) Regularly collects or attempts to collect for Wyoming creditors, directly or indirectly, debts owed or due or asserted to be owed or due another;
(C) Takes assignment of debts for the purpose of collecting such debts;
(D) Directly or indirectly, solicits for collection debts owed or due or asserted to be owed or due a Wyoming creditor;
(E) Uses a fictitious name or any name other than their own name in the collection of their own accounts receivable; or
(F) Collects debts incurred in this state from debtors located in this state by means of interstate communications, including telephone, mail or facsimile or any other electronic
method, from the debt collector’s location in another state.
(v) “Consumer” means any natural person obligated or allegedly obligated to pay any debt;
(vii) “Debt” means any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance or services which are the subject of the transaction are primarily for personal, family or household purposes, whether or not the obligation has been reduced to judgment;
(viii) “Debt collector” means any person employed or engaged by a collection agency to perform the collection of debts owed or due or asserted to be owed or due to another, including any owner or shareholder of the collection agency business who engages in the collection of debts;
Wyo. Stat. Ann. § 33-11-101(a)(ii)-(viii) (West, WESTLAW through the 2004 Spec. Sess. (57th Leg.))
(b) The term “collection agency” does not include:
(i) Any officer or employee of a creditor while collecting debts for and in the name of the creditor;
(ii) Any officer or employee of the United States or of any state, to the extent that collecting or attempting to collect a debt is in the performance of his official duties;
(iii) Any person while serving or attempting to serve legal process on another person in connection with the judicial enforcement of any debt;
(iv) Any person whose principal business is the making of loans or the servicing of debt, and who acts as a loan correspondent, seller or servicing agent for the owner or holder of a debt which is secured by a mortgage on real property, whether or not the debt is also secured by an interest in personal property;
(v) Any person whose collection activities are carried on in the true name of the creditor, and are
confined to the operation of a business other than a collection agency, including but not limited to banks, trust companies, savings and loan associations, abstract companies doing an escrow business, real estate brokers, attorneys, insurance companies, credit unions or loan or finance companies;
(vi) Any person whose business is the servicing of credit card debt;
(vii) Any person engaged solely in the collection of one (1) or more business debts; or
(viii) Any licensed attorney acting in an attorney-client relationship with the creditor, and who conducts the collection in the true name of the client.
Wyo. Stat. Ann. § 33-11-101(b) (West, WESTLAW through the 2004 Spec. Sess. (57th Leg.)).
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).