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AB-2825 Debt collection: debt buying.(2017-2018)

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Date Published: 04/18/2018 09:00 PM
AB2825:v97#DOCUMENT

Amended  IN  Assembly  April 18, 2018
Amended  IN  Assembly  March 19, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 2825


Introduced by Assembly Member Jones-Sawyer

February 16, 2018


An act to amend Sections 1788.1, 1788.2, 1788.10, 1788.11, 1788.12, 1788.13, 1788.14, 1788.15, 1788.16, 1788.17, 1788.18, 1788.50, 1788.52, 1788.54, 1788.56, 1788.58, and 1788.60, of the Civil Code, relating to debt collection and buying.


LEGISLATIVE COUNSEL'S DIGEST


AB 2825, as amended, Jones-Sawyer. Debt collection. collection: debt buying.
Existing law, the Rosenthal Fair Debt Collection Practices Act, is intended to prohibit debt collectors from engaging in unfair or deceptive acts or practices in the collection of consumer debts and to require debtors to act fairly in entering into and honoring those debts. Existing law prohibits a debt collector from, among other things, collecting or attempting to collect a consumer debt by means of the use, or threat of use, of physical force or violence or any criminal means to cause harm to the person, or the reputation, or the property of any person.
This bill would expand the act to apply to collections or attempts to collect a “nonconsensual obligation to pay,” which the bill would define to mean the charges underlying a lien created by operation of law, unpaid parking penalties, or past due residential rent and associated late fees, as specified.
Existing law makes it a crime, with respect to attempted collection of a consumer debt, for a debt collector, creditor, or an attorney, to send a communication that simulates legal or judicial process or that gives the appearance of being authorized, issued, or approved by a governmental agency or attorney if it is not.
This bill would expand that provision to make it a crime to engage in those act with respect to the collection of a nonconsensual obligation to pay. By expanding a crime, the bill would impose a state-mandated local program.
Existing law requires a debt collector to stop collecting a consumer debt when an alleged debtor provides the debt collector certain information, including information relating to the debtor’s status as an alleged victim of identity theft. This information may also include a specified written statement that certifies that the representations are true, correct, and contain no material omissions of fact. A person submitting the certification who declares as true a material matter that the person knows to be false is guilty of a misdemeanor.
This bill would expand those provisions to also apply in the case of collection of a nonconsensual obligation to pay. The bill would thereby expand the scope of a crime and impose a state-mandated local program.
Existing law regulates the activities of a person or entity that has bought charged-off consumer debt, as defined, for collection purposes and the circumstances pursuant to which the person may bring suit. Existing law, among other things, prohibits a debt buyer, as defined, from making any written statement in an attempt to collect a consumer debt unless the debt buyer possesses information that the debt buyer is the sole owner or is authorized to assert the rights of all owners of the specific debt at issue, the debt balance, as specified, and the name and address of the creditor at the time the debt was charged off, among other things.
This bill would expand those provisions to apply to the purchase of charged-off nonconsensual obligations to pay, as defined, for collection purposes.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 Section 1788.1 of the Civil Code is amended to read:

1788.1.
 (a) The Legislature makes the following findings:
(1) The banking and credit system and grantors of credit to consumers are dependent upon the collection of just and owing debts. Unfair or deceptive collection practices undermine the public confidence which is essential to the continued functioning of the banking and credit system and sound extensions of credit to consumers.
(2) There is need to ensure that debt collectors and debtors exercise their responsibilities to one another with fairness, honesty, and due regard for the rights of the other.
(b) It is the purpose of this title to prohibit debt collectors from engaging in unfair or deceptive acts or practices in the collection of consumer debts and nonconsensual obligations to pay, and to require debtors to act fairly in entering into and honoring debts, as specified in this title.

SEC. 2.

 Section 1788.2 of the Civil Code is amended to read:

1788.2.
 (a) Definitions and rules of construction set forth in this section are applicable for the purpose of this title.
(b) The term “debt collection” means any act or practice in connection with the collection of consumer debts and nonconsensual obligations to pay.
(c) The term “debt collector” means any person who, in the ordinary course of business, regularly, on behalf of himself or herself or others, engages in debt collection. The term includes any person who composes and sells, or offers to compose and sell, forms, letters, and other collection media used or intended to be used for debt collection, but does not include an attorney or counselor at law.
(d) The term “debt” means money, property property, or their equivalent which is due or owing or alleged to be due or owing from a natural person to another person.
(e) The term “consumer credit transaction” means a transaction between a natural person and another person in which property, services services, or money is acquired on credit by that natural person from such other person primarily for personal, family, or household purposes.
(f) The terms “consumer debt” and “consumer credit” mean money, property property, or their equivalent, due or owing or alleged to be due or owing from a natural person by reason of a consumer credit transaction.
(g) The term “person” means a natural person, partnership, corporation, limited liability company, trust, estate, cooperative, association association, or other similar entity.
(h) Except as provided in Section 1788.18, the term “debtor” means a natural person from whom a debt collector seeks to collect a consumer debt or nonconsensual obligation to pay that is due and owing or alleged to be due and owing from the person.
(i) The term “creditor” means a person who extends consumer credit to a debtor.
(j) The term “consumer credit report” means any written, oral oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s creditworthiness, credit standing, credit capacity, character, general reputation, personal characteristics characteristics, or mode of living that is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility for (1) credit or insurance to be used primarily for person, family, or household purposes, or (2) employment purposes, or (3) other purposes authorized under any applicable federal or state law or regulation. The term does not include (a) any report containing information solely as to transactions or experiences between the consumer and the person making the report; (b) any authorization or approval of a specific extension of credit directly or indirectly by the issuer of a credit card or similar device; or (c) any report in which a person who has been requested by a third party to make a specific extension of credit directly or indirectly to a consumer conveys his or her decision with respect to that request, if the third party advises the consumer of the name and address of the person to whom the request was made and the person makes the disclosures to the consumer required under any applicable federal or state law or regulation.
(k) The term “consumer reporting agency” means any person who, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages, in whole or in part, in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer credit reports to third parties, and that uses any means or facility for the purpose of preparing or furnishing consumer credit reports.
(l) The term “lien” has the same meaning as in Section 2872.
(m) The term “nonconsensual obligation to pay” means (1) the charges underlying a lien created by operation of law under Section 2881, including towing and storage charges under Section 22851 of the Vehicle Code; (2) unpaid parking penalties under Section 40220 of the Vehicle Code; or (3) past due residential rent and associated late fees.

SEC. 3.

 Section 1788.10 of the Civil Code is amended to read:

1788.10.
 No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of the following conduct:
(a) The use, or threat of use, of physical force or violence or any criminal means to cause harm to the person, or the reputation, or the property of any person;
(b) The threat that the failure to pay a consumer debt or nonconsensual obligation to pay will result in an accusation that the debtor has committed a crime if the accusation, if made, would be false;
(c) The communication of, or threat to communicate to any person the fact that a debtor has engaged in conduct, other than the failure to pay a consumer debt or nonconsensual obligation to pay that the debt collector knows or has reason to believe will defame the debtor;
(d) The threat to the debtor to sell or assign to another person the obligation of the debtor to pay a consumer debt or nonconsensual obligation to pay, with an accompanying false representation that the result of the sale or assignment would be that the debtor would lose any defense to the consumer debt or nonconsensual obligation to pay;
(e) The threat to any person that nonpayment of the consumer debt or nonconsensual obligation to pay may result in the arrest of the debtor or the seizure, garnishment, attachment, or sale of any property or the garnishment or attachment of wages of the debtor, unless that action is in fact contemplated by the debt collector and permitted by the law; or
(f) The threat to take any action against the debtor that is prohibited by this title.

SEC. 4.

 Section 1788.11 of the Civil Code is amended to read:

1788.11.
 No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of the following practices:
(a) Using obscene or profane language.
(b) Placing telephone calls without disclosure of the caller’s identity, provided that an employee of a licensed collection agency may identify himself or herself by using his or her registered alias name as long as he or she correctly identifies the agency he or she represents.
(c) Causing expense to any person for long distance telephone calls, telegram fees, or charges for other similar communications, by misrepresenting to the person the purpose of the telephone call, telegram, or similar communication.
(d) Causing a telephone to ring repeatedly or continuously to annoy the person called.
(e) Communicating, by telephone or in person, with the debtor so frequently as to be unreasonable and to constitute an a harassment to the debtor under the circumstances.

SEC. 5.

 Section 1788.12 of the Civil Code is amended to read:

1788.12.
 No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of the following practices:
(a) Communicating with the debtor’s employer regarding the debtor’s consumer debt or nonconsensual obligation to pay unless that communication is necessary to the collection of the debt or nonconsensual obligation to pay or unless the debtor or his attorney has consented in writing to the communication. A communication is necessary to the collection of the debt or nonconsensual obligation to pay only if it is made for the purposes of verifying the debtor’s employment, locating the debtor, or effecting garnishment, after judgment, of the debtor’s wages, or in the case of a medical debt for the purpose of discovering the existence of medical insurance. Any such communication, other than a communication in the case of a medical debt by a health care provider or its agent for the purpose of discovering the existence of medical insurance, shall be in writing unless the written communication receives no response within 15 days and shall be made only as many times as is necessary to the collection of the debt or nonconsensual obligation to pay. Communications to a debtor’s employer regarding a debt or nonconsensual obligation to pay shall not contain language that would be improper if the communication were made to the debtor. One communication solely for the purpose of verifying the debtor’s employment may be oral without prior written contact.
(b) Communicating information regarding a consumer debt or nonconsensual obligation to pay to any member of the debtor’s family, other than the debtor’s spouse or the parents or guardians of the debtor who is either a minor or who resides in the same household with a parent or guardian, prior to obtaining a judgment against the debtor, unless the purpose of the communication is to locate the debtor, or if the debtor or his attorney has consented in writing to the communication.
(c) Communicating to any person any list of debtors that discloses the nature or existence of a consumer debt or nonconsensual obligation to pay, commonly known as “deadbeat lists”, lists, or advertising any consumer debt or nonconsensual obligation to pay for sale, by naming the debtor.
(d) Communicating with the debtor by means of a written communication that displays or conveys any information about the consumer debt or nonconsensual obligation to pay, or the debtor other than the name, address, and telephone number of the debtor and the debt collector and that is intended both to be seen by any other person and also to embarrass the debtor.
(e) Notwithstanding the foregoing provisions of this section, the disclosure, publication, or communication by a debt collector of information relating to a consumer debt or nonconsensual obligation to pay, or the debtor to a consumer reporting agency or to any other person reasonably believed to have a legitimate business need for the information shall not be deemed to violate this title.

SEC. 6.

 Section 1788.13 of the Civil Code is amended to read:

1788.13.
 No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of the following practices:
(a) Any communication with the debtor other than in the name either of the debt collector or the person on whose behalf the debt collector is acting.
(b) Any false representation that any person is an attorney or counselor at law.
(c) Any communication with a debtor in the name of an attorney or counselor at law or upon stationery or like written instruments bearing the name of the attorney or counselor at law, unless the communication is by an attorney or counselor at law or has been approved or authorized by an attorney or counselor at law.
(d) The representation that any debt collector is vouched for, bonded by, affiliated with, or is an instrumentality, agent, or official of any federal, state, or local government or any agency of federal, state, or local government, unless the collector is actually employed by the particular governmental agency in question and is acting on behalf of the agency in the debt collection matter.
(e) The false representation that the consumer debt or nonconsensual obligation to pay may be increased by the addition of attorney’s fees, investigation fees, service fees, finance charges, or other charges if, in fact, those fees or charges may not legally be added to the existing obligation.
(f) The false representation that information concerning a debtor’s failure or alleged failure to pay a consumer debt or nonconsensual obligation to pay has been, or is about to be, referred to a consumer reporting agency.
(g) The false representation that a debt collector is a consumer reporting agency.
(h) The false representation that collection letters, notices, or other printed forms are being sent by or on behalf of a claim, credit, audit, or legal department.
(i) The false representation of the true nature of the business or services being rendered by the debt collector.
(j) The false representation that a legal proceeding has been, is about to be, or will be instituted unless payment of a consumer debt or nonconsensual obligation to pay is made.
(k) The false representation that a consumer debt or nonconsensual obligation to pay has been, is about to be, or will be sold, assigned, or referred to a debt collector for collection.
(l) Any communication by a licensed collection agency to a debtor demanding money unless the claim is actually assigned to the collection agency.

SEC. 7.

 Section 1788.14 of the Civil Code is amended to read:

1788.14.
 No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of the following practices:
(a) Obtaining an affirmation from a debtor of a consumer debt or nonconsensual obligation to pay that has been discharged in bankruptcy, without clearly and conspicuously disclosing to the debtor, in writing, at the time the affirmation is sought, the fact that the debtor is not legally obligated to make the affirmation.
(b) Collecting or attempting to collect from the debtor the whole or any part of the debt collector’s fee or charge for services rendered, or other expense incurred by the debt collector in the collection of the consumer debt or nonconsensual obligation to pay, except as permitted by law.
(c) Initiating communications, other than statements of account, with the debtor with regard to the consumer debt or nonconsensual obligation to pay, when the debt collector has been previously notified in writing by the debtor’s attorney that the debtor is represented by the attorney with respect to the consumer debt or nonconsensual obligation to pay and that notice includes the attorney’s name and address and a request by the attorney that all communications regarding the consumer debt or nonconsensual obligation to pay be addressed to the attorney, unless the attorney fails to answer correspondence, return telephone calls, or discuss the obligation in question. This subdivision shall not apply if prior approval has been obtained from the debtor’s attorney, or if the communication is a response in the ordinary course of business to a debtor’s inquiry.

SEC. 8.

 Section 1788.15 of the Civil Code is amended to read:

1788.15.
 (a) No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay by means of judicial proceedings if the debt collector knows that service of process, where essential to jurisdiction over the debtor or his property, has not been legally effected.
(b) No debt collector shall collect or attempt to collect a consumer debt or nonconsensual obligation to pay other than one reduced to judgment, by means of judicial proceedings in a county other than the county in which the debtor has incurred the consumer debt or nonconsensual obligation to pay or the county in which the debtor resides at the time the proceedings are instituted, or resided at the time the debt or nonconsensual obligation to pay was incurred.

SEC. 9.

 Section 1788.16 of the Civil Code is amended to read:

1788.16.
 It is unlawful, with respect to attempted collection of a consumer debt or nonconsensual obligation to pay, for a debt collector, creditor, or an attorney, to send a communication that simulates legal or judicial process or that gives the appearance of being authorized, issued, or approved by a governmental agency or attorney if it is not. Any violation of the provisions of this section is a misdemeanor punishable by imprisonment in the county jail not exceeding six months, or by a fine not exceeding two thousand five hundred dollars ($2,500), or by both.

SEC. 10.

 Section 1788.17 of the Civil Code is amended to read:

1788.17.
 Notwithstanding any other provision of this title, every debt collector collecting or attempting to collect a consumer debt or nonconsensual obligation to pay shall comply with the provisions of Sections 1692b to 1692j, inclusive, of, and shall be subject to the remedies in Section 1692k of, Title 15 of the United States Code. However, subsection (11) of Section 1692e and Section 1692g shall not apply to any person specified in paragraphs (A) and (B) of subsection (6) of Section 1692a of Title 15 of the United States Code or that person’s principal. The references to federal codes in this section refer to those codes as they read January 1, 2001.

SEC. 11.

 Section 1788.18 of the Civil Code is amended to read:

1788.18.
 (a) Upon receipt from a debtor of all of the following, a debt collector shall cease collection activities until completion of the review provided in subdivision (d):
(1) A copy of a police report filed by the debtor alleging that the debtor is the victim of an identity theft crime, including, but not limited to, a violation of Section 530.5 of the Penal Code, for the specific debt or nonconsensual obligation to pay being collected by the debt collector.
(2) The debtor’s written statement that the debtor claims to be the victim of identity theft with respect to the specific debt or nonconsensual obligation to pay being collected by the debt collector.
(b) The written statement described in paragraph (2) of subdivision (a) shall consist of any of the following:
(1) A Federal Trade Commission’s Affidavit of Identity Theft.
(2) A written statement that contains the content of the Identity Theft Victim’s Fraudulent Account Information Request offered to the public by the California Office of Privacy Protection.
(3) A written statement that certifies that the representations are true, correct, and contain no material omissions of fact to the best knowledge and belief of the person submitting the certification. A person submitting the certification who declares as true any material matter pursuant to this subdivision that he or she knows to be false is guilty of a misdemeanor. The statement shall contain or be accompanied by the following, to the extent that an item listed below is relevant to the debtor’s allegation of identity theft with respect to the debt or nonconsensual obligation to pay in question:
(A) A statement that the debtor is a victim of identity theft.
(B) A copy of the debtor’s driver’s license or identification card, as issued by the state.
(C) Any other identification document that supports the statement of identity theft.
(D) Specific facts supporting the claim of identity theft, if available.
(E) Any explanation showing that the debtor did not incur the debt or nonconsensual obligation to pay.
(F) Any available correspondence disputing the debt or nonconsensual obligation to pay after transaction information has been provided to the debtor.
(G) Documentation of the residence of the debtor at the time of the alleged debt or nonconsensual obligation to pay pay. This may include copies of bills and statements, such as utility bills, tax statements, or other statements from businesses sent to the debtor, showing that the debtor lived at another residence at the time the debt or nonconsensual obligation to pay was incurred.
(H) A telephone number for contacting the debtor concerning any additional information or questions, or direction that further communications to the debtor be in writing only, with the mailing address specified in the statement.
(I) To the extent the debtor has information concerning who may have incurred the debt, the identification of any person whom the debtor believes is responsible.
(J) An express statement that the debtor did not authorize the use of the debtor’s name or personal information for incurring the debt or nonconsensual obligation to pay.
(K) The certification required pursuant to this paragraph shall be sufficient if it is in substantially the following form:
“I certify the representations made are true, correct, and
contain no material omissions of fact.
_____ (Date and Place) _____ _____ (Signature) _____ ”
(c) If a debtor notifies a debt collector orally that he or she is a victim of identity theft, the debt collector shall notify the debtor, orally or in writing, that the debtor’s claim must be in writing. If a debtor notifies a debt collector in writing that he or she is a victim of identity theft, but omits information required pursuant to subdivision (a) or, if applicable, the certification required pursuant to paragraph (3) of subdivision (b), if the debt collector does not cease collection activities, the debt collector shall provide written notice to the debtor of the additional information that is required, or the certification required pursuant to paragraph (3) of subdivision (b), as applicable, or send the debtor a copy of the Federal Trade Commission’s Affidavit of Identity Theft form.
(d) Within 10 business days of receiving the complete statement and information described in subdivision (a), the debt collector shall, if it furnished adverse information about the debtor to a consumer credit reporting agency, notify the consumer credit reporting agency that the account is disputed, and initiate a review considering all of the information provided by the debtor and other information available to the debt collector in its file or from the creditor. The debt collector shall send notice of its determination to the debtor no later than 10 business days after concluding the review. The debt collector may recommence debt collection activities only upon making a good faith determination that the information does not establish that the debtor is not responsible for the specific debt or nonconsensual obligation to pay in question. The debt collector’s determination shall be made in a manner consistent with the provisions of subsection (1) of Section 1692 of Title 15 of the United States Code, as incorporated by Section 1788.17 of this code. The debt collector shall notify the debtor in writing of that determination and the basis for that determination before proceeding with any further collection activities. The debt collector’s determination shall be based on all of the information provided by the debtor and other information available to the debt collector in its file or from the creditor.
(e) No inference or presumption that the debt or nonconsensual obligation to pay is valid or invalid, or that the debtor is liable or not liable for the debt or nonconsensual obligation to pay, shall arise if the debt collector decides after the review described in subdivision (d) to cease or recommence the debt collection activities. The exercise or nonexercise of rights under this section is not a waiver of any other right or defense of the debtor or debt collector.
(f) The statement and supporting documents that comply with subdivision (a) may also satisfy, to the extent those documents meet the requirements of, the notice requirement of paragraph (5) of subdivision (c) of Section 1798.93.
(g) A debt collector who ceases collection activities under this section and does not recommence those collection activities shall do all of the following:
(1) If the debt collector has furnished adverse information to a consumer credit reporting agency, notify the agency to delete that information no later than 10 business days after making its determination.
(2) Notify the creditor no later than 10 business days after making its determination that debt collection activities have been terminated based upon the debtor’s claim of identity theft.
(h) A debt collector who has possession of documents that the debtor is entitled to request from a creditor pursuant to Section 530.8 of the Penal Code is authorized to provide those documents to the debtor.
(i) Notwithstanding subdivision (h) of Section 1788.2, for the purposes of this section, “debtor” means a natural person, firm, association, organization, partnership, business trust, company, corporation, or limited liability company from which a debt collector seeks to collect a debt or a nonconsensual obligation to pay that is due and owing or alleged to be due and owing from the person or entity. The remedies provided by this title shall apply equally to violations of this section.

SEC. 12.

 Section 1788.50 of the Civil Code is amended to read:

1788.50.
 (a) As used in this title:
(1) “Debt buyer” means a person or entity that is regularly engaged in the business of purchasing charged-off consumer debt or charged-off nonconsensual obligations to pay for collection purposes, whether it collects the debt or nonconsensual obligation to pay itself, hires a third party for collection, or hires an attorney-at-law for collection litigation. “Debt buyer” does not mean a person or entity that acquires a charged-off consumer debt or charged-off nonconsensual obligation to pay incidental to the purchase of a portfolio predominantly consisting of consumer debt or nonconsensual obligations to pay that has not been charged off.
(2) “Charged-off consumer debt” means a consumer debt that has been removed from a creditor’s books as an asset and treated as a loss or expense.
(3) “Charged-off nonconsensual obligation to pay” means a nonconsensual obligation to pay that has been removed from a debt owner’s books as an asset and treated as a loss or expense.
(b) The acquisition by a check services company of the right to collect on a paper or electronic check instrument, including an Automated Clearing House item, that has been returned unpaid to a merchant does not constitute a purchase of delinquent consumer debt under this title.
(c) Terms defined in Title 1.6C (commencing with Section 1788) shall apply to this title.
(d) (1) This title shall apply to debt buyers with respect to all consumer debt sold or resold on or after January 1, 2014.
(2) This title shall apply to debt buyers with respect to all nonconsensual obligations to pay that are sold or resold on or after January 1, 2019.

SEC. 13.

 Section 1788.52 of the Civil Code is amended to read:

1788.52.
 (a) A debt buyer shall not make any written statement to a debtor in an attempt to collect a consumer debt or nonconsensual obligation to pay unless the debt buyer possesses the following information:
(1) That the debt buyer is the sole owner of the debt or nonconsensual obligation to pay at issue or has authority to assert the rights of all owners of the debt or nonconsensual obligation to pay.
(2) The debt balance, or nonconsensual obligation to pay balance, at charge off and an explanation of the amount, nature, and reason for all post-charge-off interest and fees, if any, imposed by the charge-off creditor or any subsequent purchasers of the debt or nonconsensual obligation to pay. This paragraph shall not be deemed to require a specific itemization, but the explanation shall identify separately the charge-off balance, the total of any post-charge-off interest, and the total of any post-charge-off fees.
(3) The date of default or the date of the last payment.
(4) The name and an address of the charge-off creditor at the time of charge off, and the charge-off creditor’s account number associated with the debt or nonconsensual obligation to pay. The charge-off creditor’s name and address shall be in sufficient form so as to reasonably identify the charge-off creditor.
(5) The name and last known address of the debtor as they appeared in the charge-off creditor’s records prior to the sale of the debt or nonconsensual obligation to pay. If the debt was sold prior to January 1, 2014, the name and last known address of the debtor as they appeared in the debt owner’s records on December 31, 2013, shall be sufficient. If the nonconsensual obligation to pay was sold prior to January 1, 2019, the name and last known address of the debtor as they appeared in the debt owner’s records on December 31, 2018, shall be sufficient.
(6) The names and addresses of all persons or entities that purchased the debt or nonconsensual obligation to pay after charge off, including the debt buyer making the written statement. The names and addresses shall be in sufficient form so as to reasonably identify each purchaser.
(b) A debt buyer shall not make any written statement to a debtor in an attempt to collect a consumer debt or nonconsensual obligation to pay unless the debt buyer has access to a copy of a contract or other document evidencing the debtor’s agreement to the debt or nonconsensual obligation to pay. If the claim is based on debt or a nonconsensual obligation to pay for which no signed contract or agreement exists, the debt buyer shall have access to a copy of a document provided to the debtor while the account was active, demonstrating that the debt or nonconsensual obligation to pay was incurred by the debtor. For a revolving credit account, the most recent monthly statement recording a purchase transaction, last payment, or balance transfer shall be deemed sufficient to satisfy this requirement.
(c) A debt buyer shall provide the information or documents identified in subdivisions (a) and (b) to the debtor without charge within 15 calendar days of receipt of a debtor’s written request for information about or proof of the debt or nonconsensual obligation to pay. If the debt buyer cannot provide the information or documents within 15 calendar days, the debt buyer shall cease all collection of the debt or nonconsensual obligation to pay until the debt buyer provides the debtor the information or documents described in subdivisions (a) and (b). Except as provided otherwise in this title, the request by the debtor shall be consistent with the validation requirements contained in Section 1692g of Title 15 of the United States Code. A debt buyer shall provide all debtors with whom it has contact an active postal address to which these requests can be sent. A debt buyer may also provide an active email address to which these requests can be sent and through which information and documents can be delivered, if the parties agree.
(d) (1) A debt buyer shall include with its first written communication with the debtor in no smaller than 12-point type, a separate prominent notice that provides:

“You may request records showing the following: (1) that [insert name of debt buyer] has the right to seek collection of the debt or nonconsensual obligation to pay; debt; (2) the debt or nonconsensual obligation to pay balance, including an explanation of any interest charges and additional fees; (3) the date of default or the date of the last payment; (4) the name of the charge-off creditor and the account number associated with the debt or nonconsensual obligation to pay; debt; (5) the name and last known address of the debtor as it appeared in the charge-off creditor’s or debt buyer’s records prior to the sale of the debt or nonconsensual obligation to pay, debt, as appropriate; and (6) the names of all persons or entities that have purchased the debt or nonconsensual obligation to pay. debt. You may also request from us a copy of the contract or other document evidencing your agreement to the debt or nonconsensual obligation to pay. debt.
“A A request for these records may be addressed to: [insert debt buyer’s active mailing address and email address, if applicable].”

(2) When collecting on a time-barred debt or nonconsensual obligation to pay where the debt or nonconsensual obligation to pay is not past the date for obsolescence provided for in Section 605(a) of the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681c):

“The law limits how long you can be sued on a debt or nonconsensual obligation to pay. debt. Because of the age of your debt or nonconsensual obligation to pay, debt, we will not sue you for it. If you do not pay the debt or nonconsensual obligation to pay, debt, [insert name of debt buyer] may [continue to] report it to the credit reporting agencies as unpaid for as long as the law permits this reporting.”

(3) When collecting on a time-barred debt or nonconsensual obligation to pay where the debt or nonconsensual obligation to pay is past the date for obsolescence provided for in Section 605(a) of the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681c):

“The law limits how long you can be sued on a debt or nonconsensual obligation to pay. debt. Because of the age of your debt or nonconsensual obligation to pay, debt, we will not sue you for it, and we will not report it to any credit reporting agency.”

(e) If a language other than English is principally used by the debt buyer in the initial oral contact with the debtor, the notice required by subdivision (d) shall be provided to the debtor in that language within five working days.
(f) In the event of a conflict between the requirements of subdivision (d) and federal law, so that it is impracticable to comply with both, the requirements of federal law shall prevail.

SEC. 14.

 Section 1788.54 of the Civil Code is amended to read:

1788.54.
 (a) All settlement agreements between a debt buyer and a debtor shall be documented in open court or otherwise reduced to writing. The debt buyer shall ensure that a copy of the written agreement is provided to the debtor.
(b) A debt buyer that receives payment on a debt or nonconsensual obligation to pay shall provide, within 30 calendar days, a receipt or monthly statement, to the debtor. The receipt or statement shall clearly and conspicuously show the amount and date paid, the name of the entity paid, the current account number, the name of the charge-off creditor, the account number issued by the charge-off creditor, and the remaining balance owing, if any. The receipt or statement may be provided electronically if the parties agree.
(c) A debt buyer that accepts a payment as payment in full, or as a full and final compromise of the debt or nonconsensual obligation to pay, shall provide, within 30 calendar days, a final statement that complies with subdivision (b). A debt buyer shall not sell an interest in a resolved debt or nonconsensual obligation to pay or any personal or financial information related to the resolved debt or nonconsensual obligation to pay.

SEC. 15.

 Section 1788.56 of the Civil Code is amended to read:

1788.56.
 A debt buyer shall not bring suit or initiate an arbitration or other legal proceeding to collect a consumer debt or nonconsensual obligation to pay if the applicable statute of limitations on the debt buyer’s claim has expired.

SEC. 16.

 Section 1788.58 of the Civil Code is amended to read:

1788.58.
 In an action brought by a debt buyer on a consumer debt or nonconsensual obligation to pay:
(a) The complaint shall allege all of the following:
(1) That the plaintiff is a debt buyer.
(2) The nature of the underlying debt and the consumer transaction or transactions or nonconsensual obligation to pay from which it is derived, in a short and plain statement.
(3) That the debt buyer is the sole owner of the debt or nonconsensual obligation to pay at issue, or has authority to assert the rights of all owners of the debt or nonconsensual obligation to pay.
(4) The debt balance, or nonconsensual obligation to pay balance, at charge off and an explanation of the amount, nature, and reason for all post-charge-off interest and fees, if any, imposed by the charge-off creditor or any subsequent purchasers of the debt or nonconsensual obligation to pay. This paragraph shall not be deemed to require a specific itemization, but the explanation shall identify separately the charge-off balance, the total of any post-charge-off interest, and the total of any post-charge-off fees.
(5) The date of default or the date of the last payment.
(6) The name and an address of the charge-off creditor at the time of charge off and the charge-off creditor’s account number associated with the debt or nonconsensual obligation to pay. The charge-off creditor’s name and address shall be in sufficient form so as to reasonably identify the charge-off creditor.
(7) The name and last known address of the debtor as they appeared in the charge-off creditor’s records prior to the sale of the debt or nonconsensual obligation to pay. If the debt was sold prior to January 1, 2014, the debtor’s name and last known address as they appeared in the debt owner’s records on December 31, 2013, shall be sufficient. If the nonconsensual obligation to pay was sold prior to January 1, 2019, the debtor’s name and last known address as they appeared in the debt owner’s records on December 31, 2018, shall be sufficient.
(8) The names and addresses of all persons or entities that purchased the debt or nonconsensual obligation to pay after charge off, including the plaintiff debt buyer. The names and addresses shall be in sufficient form so as to reasonably identify each such purchaser.
(9) That the debt buyer has complied with Section 1788.52.
(b) A copy of the contract or other document described in subdivision (b) of Section 1788.52 shall be attached to the complaint.
(c) The requirements of this title shall not be deemed to require the disclosure in public records of personal, financial, or medical information, the confidentiality of which is protected by any state or federal law.

SEC. 17.

 Section 1788.60 of the Civil Code is amended to read:

1788.60.
 (a) In an action initiated by a debt buyer, no default or other judgment may be entered against a debtor unless business records, authenticated through a sworn declaration, are submitted by the debt buyer to the court to establish the facts required to be alleged by paragraphs (3) to (8), inclusive, of subdivision (a) of Section 1788.58.
(b) No default or other judgment may be entered against a debtor unless a copy of the contract or other document described in subdivision (b) of Section 1788.52, authenticated through a sworn declaration, has been submitted by the debt buyer to the court.
(c) In any action on a consumer debt or nonconsensual obligation to pay, if a debt buyer plaintiff seeks a default judgment and has not complied with the requirements of this title, the court shall not enter a default judgment for the plaintiff and may, in its discretion, dismiss the action.
(d) Except as provided in this title, this section is not intended to modify or otherwise amend the procedures established in Section 585 of the Code of Civil Procedure.

SEC. 18.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.