Financial Services Law Developments: FYI: Illinois Amends Collection Agency Act to Correct Problematic Provisions

Wednesday, February 3, 2016

FYI: Illinois Amends Collection Agency Act to Correct Problematic Provisions

Illinois Governor Bruce Rauner recently signed Illinois SB 1369 into law, thereby providing welcomed corrections to the Illinois Collection Agency Act ("ICAA") arising from problematic August 2015 amendments to the statute.

A copy of Act now signed into law is available here: Link to Public Act 099-0500

We previously described the proposed changes in SB 1369 that would rewind some of the unintended consequences wrought by the prior August 2015 amendments. The text of our prior update is available here: Link to Update

The August 2015 amendments would potentially have expanded sections of the ICAA to commercial debt, and would have required disclosures contrary to (and possibly in violation of) the federal Fair Debt Collection Practices Act.

The corrective legislation:

- Amends section 9.1 (Communication with persons other than debtor) to provide that when seeking location information from third parties, collection agencies and debt buyers must provide the name of their employer "only if expressly requested"

- Amends section 9.3 (Debt validation) to provide that a collection agency or debt buyer provide a debtor with the name and address of the original creditor only if requested by a debtor, in writing, within the 30-day validation period

- Amends the above sections as well as sections 2 (Definitions) and 9.2 (Communication in connection with debt) to apply only to debt incurred primarily for personal, family or household purposes

- Adds that a collection agency or debt buyer is immune from civil liability under sections 2, 9.1, 9.2, or 9.3 of the ICCA if it can demonstrate compliance with comparable provisions of the FDCPA

The Act became effective upon the Governor's signature on January 29, 2016.

Ralph T. Wutscher
Maurice Wutscher LLP
The Loop Center Building
105 W. Madison Street, 18th Floor
Chicago, Illinois 60602
Direct: (312) 551-9320
Fax: (312) 284-4751

Mobile: (312) 493-0874
Email: rwutscher@MauriceWutscher.com

Admitted to practice law in Illinois

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The Editor's Bio

Ralph T. Wutscher
Maurice Wutscher LLP
20 N. Clark Street, 33rd Floor
Chicago, Illinois 60602
Direct: (312) 493-0874
RWutscher@MauriceWutscher.com
https://www.MauriceWutscher.com/

Ralph Wutscher's practice focuses primarily on representing depository and non-depository mortgage lenders and servicers, as well as mortgage loan investors, distressed asset buyers and sellers, loss mitigation companies, automobile and other personal property secured lenders and finance companies, credit card and other unsecured lenders, and other consumer financial services providers. He represents the consumer lending industry as a litigator, and as regulatory compliance counsel.

Ralph has substantial experience in defending private consumer finance lawsuits, including cases ranging from large interstate putative class actions to localized single-asset cases, as well as in responding to regulatory investigations and other governmental proceedings. His litigation successes include not only victories at the trial court level, but also on appeal, and in various jurisdictions. He has successfully defended numerous putative class actions asserting violations of a wide range of federal and state consumer protection statutes. He is frequently consulted to assist other law firms in developing or improving litigation strategies in cases filed around the country.

Ralph also has substantial experience in counseling clients regarding their compliance with federal laws, and with state and local laws primarily of the Midwestern United States. For example, he regularly provides assistance in connection with portfolio or program audits, consumer lending disclosure issues, the design and implementation of marketing and advertising campaigns, licensing and reporting issues, compliance with usury laws and other limitations on pricing, compliance with state and local “predatory lending” laws, drafting or obtaining opinion letters on a single- or multi-state basis, interstate branching and loan production office licensing, evaluations and modifications of new or existing products and procedures, debt collection and servicing practices, proper methods of responding to consumer inquiries and furnishing consumer information, as well as proposed or existing arrangements with settlement service providers and other vendors, and the implementation of procedural or other operational changes following developments in the law.

Ralph is a member of the Governing Committee of the Conference on Consumer Finance Law. He is also the immediate past Chair of the Preemption and Federalism Subcommittee for the ABA's Consumer Financial Services Committee. He served on the Law Committee for the former National Home Equity Mortgage Association, and completed two terms as Co-Chair of the Consumer Credit Committee of the Chicago Bar Association.

Ralph received his Juris Doctor from the University of Illinois College of Law, and his undergraduate degree from the University of California at Los Angeles (UCLA). He is a member of the national Mortgage Bankers Association, the American Bankers Association, the Conference on Consumer Finance Law, DBA International, the ACA International Members Attorney Program, as well as the American and Chicago Bar Associations.

Ralph is admitted to practice in Illinois, as well as in the United States Court of Appeals for the Seventh Circuit, the United States District Courts for the Northern and Southern Districts of Illinois, and the United States District Court for the Eastern District of Wisconsin, and has been admitted pro hac vice in various jurisdictions around the country.