RULES OF THE ADMINISTRATOR, COLORADO COLLECTION AGENCY BOARD
(effective november 1, 2008)

Scope of Rules

These rules apply to all collection agencies and debt collectors, whether or not exempt from licensing under the Colorado Fair Debt Collection Practices Act, unless the rule is limited to “licensees” or “applicants.”  The words “client” and “creditor” have the same meaning throughout these rules.

Chapter 1

Licensing and Disciplinary Matters

Rule 1.01	Collections Manager

(1)	Whenever an applicant or licensee designates a new collections manager, it shall notify the Administrator by filing a collections manager application form.  the collections manager shall meet the qualifications of sections 12-14-119, 12-14-123(2), and the other applicable provisions of the Colorado Fair Debt Collection Practices Act. 

(2)	Pursuant to section 12-14-122(3)(a), C.R.S., an application filed due to a change of collections manager shall be filed within thirty days of the change.  The temporary absence of an approved collections manager does not constitute a change requiring designation of a new manager.

(Prior subsection (3) was repealed)

Rule 1.02	Licensure

No license shall issue until all necessary documents and information have been filed, all fees paid, and the designated collection manager's qualifications to collect debts has been determined.  No debts may be collected nor creditor accounts solicited until a license has been issued.

Rule 1.06	License Renewals

Collection agency licenses shall be valid from the date of issuance to the following July 1. In order to renew its license, a licensee must file its completed renewal application and renewal fee on or before July 1 of each year or its license shall automatically expire.

rule 1.07	address changes

For purposes of section 12-14-122(1)(a), C.R.S. mandating written notice to the Administrator within thirty days of a change of business address, the business address is the principal place of business printed on the collection agency’s license.

Rule 1.08	abbreviated applications

(1)	A licensee filing an abbreviated license application upon a change of ownership structure pursuant to section 12-14-122(2)(c)(III), C.R.S. is not required to submit the following:

(a)	Investigation fee;
(b)	List of currently employed debt collectors and solicitors;
(c)	License verification forms from other states that license the applicant; and,
(d)	If there has been no change in any of the documentation on file with the administrator:
	(i)	Personal affidavits of owners, officers, members/managers, and partners;
	(II)	Collections manager application; and
	(iii)	List of branch offices.

Chapter 2

Consumer Protections

Rule 2.01	Notices

(1)	The consumer rights information required to be in the initial written communication and the validation of debts notice may be printed on two (2) separate pages provided that the first page contains language referring the consumer to the second page and the two (2) pages are attached together.

(2)	Every collection notice mailed or delivered by a licensee must contain the collection agency's name, mailing address, and toll-free telephone number.  The collection agency's address may not be printed only on any portion of the collection notice designed to be returned to the agency with the consumer’s communication or payment.  “Toll-free” means a call made at no cost to the consumer.

Rule 2.03	Costs of Collection

(1)	No collection agency shall add, collect, or attempt to collect a charge for costs of collection unless such costs are expressly authorized by statute or by the contract, agreement, note, or other instrument creating the debt and are not otherwise prohibited by law.  

(2)	No licensee shall advise, suggest, or request that a client add collection costs to any existing debt unless such costs are specifically authorized by statute.

(3)	If a statute, contract, agreement, note, or other instrument specifically authorizes the addition of collection costs and such costs are collected, the licensee may retain only those collection costs exclusive of attorney fees and court costs as its fee or commission for the collection of the debt, unless otherwise agreed to in writing with the assignor.

(4)	No collection agency shall add, collect, or attempt to collect costs of collection pursuant to § 13-21-109(1)(b) (II), C.R.S. on any dishonored check, draft, or payment order payable to it unless the check is assigned for collection to another collection agency not owned in whole or in part by the payee collection agency.

Rule 2.06	Account Statements

(1)	Subject to the payment record retention requirements of Rule 3.03, a collection agency shall provide the consumer with a written statement of the consumer’s payments for as long as the collection agency has had assignment of the debt within ten (10) days after the consumer makes a written request.  The statement shall include the consumer’s name, the creditor’s name, the amounts paid, the dates on which payments were received, the allocation of each payment to, as applicable, principal, interest, court costs, attorney fees, other costs, the interest rate, and the current balance due.  Account statements shall be provided upon request without charge once during any twelve (12) month period.  If additional statements are requested, they may be provided upon payment of a reasonable fee not to exceed five dollars ($5.00) per statement.

(2)	After a debt has been paid or settled in full, a collection agency shall provide a written statement or receipt that the debt has been paid or settled in full within ten (10) business days after request by the consumer.  Such a statement shall be provided free of charge.  a “business day” does not include Sundays or legal holidays.

Rule 2.07	Consumer communication Records

Collection agencies shall maintain accurate summaries or records of all communication in connection with the collection or attempted collection of a debt with consumers, a consumer’s attorney or representative, the consumer’s employer, consumer reporting agencies, and persons contacted to obtain location information, for two (2) years following the date of the communication.

rule 2.15	disclosure of contact information

upon the request of a consumer or person contacted for location information, a licensee shall provide its principal place of business, mailing address, toll-free telephone number, and, if applicable, facsimile number. 

Rule 2.16	Debt Collector Obligations

Except as otherwise provided, all references in this Chapter 2 to collection agencies shall apply to debt collectors.

Chapter 3

Creditor Protections

Rule 3.01	Trust Accounts

(1)	A licensee shall maintain the trust account required by section 12-14-123(1)(c), C.R.S., but need not maintain the account in a Colorado bank or financial institution if the licensee maintains one or more trust accounts in other states for the benefit of its clients, including its Colorado clients, and it executes and files annual written authorization with the Administrator on an approved form acknowledging the account(s) may be attached upon order of a Colorado court.

(2)	If any of the trust account information in a licensee's license or renewal application changes, the licensee must file a new bank authorization form within thirty (30) days of the date of the change.

(3)	No trust account is required if the licensee does not receive nor have access to any consumer payments because they are made directly to the client according to all of the licensee's contracts or agreements.

(4)	A licensee, other than one that only collects debts it owns, shall maintain in its trust account the minimum liquid assets referred to in section 12-14-123(1)(a), C.R.S.

Rule 3.02	Unidentified Accounts

(1)	If a licensee receives a consumer payment but is unable to identify the client account on whose behalf the payment is made, the licensee shall return the entire payment to the consumer within thirty (30) days after the end of the month in which the payment was received.

(2)	No amount may be retained by a licensee as fee or commission from any consumer payment made on an unidentified account.

(3)	If a licensee is able to identify, but cannot locate, a client on whose behalf payment is made, the licensee shall comply with applicable state laws on unclaimed property.

Rule 3.03	Payment Records

(1)	Licensees shall maintain a record of all consumer payments for two (2) years following the date the payment was received.

(2)	Records of consumer payments shall include the consumer's name, the client's name, the amounts paid, the dates on which payments were received, the allocation of each payment to, as applicable, principal, interest, court costs, attorney fees, other costs, the interest rate, the current balance due, and the date of deposit of the payment to the trust account.

rule 3.05	Return of Accounts

(1)	If a licensee may retain accounts in the process of collection, as defined in section 12-14-124(6), C.R.S., it must disclose that information to its clients at the time it initially accepts accounts for collection.

(2)	This Rule 3.05 takes effect May 1, 2009 and applies to all of the licensee’s current and future clients.

Rule 3.06	Licensee Obligations

Except as otherwise provided, all references in this Chapter 3 to licensees shall apply to applicants.

statement of basis, specific statutory authority, and purpose

The amendments conform the existing rules governing collection agencies to statutory changes in House Bill 08-1240 and also add rules on licensing matters consumer protections including disclosure of a licensee’s contact information, and creditor protections including disclosure of conditions for return of accounts.

In addition to conforming to the 2008 statutory changes, the other purpose of the amended rules is to provide consumer and creditor protections and to streamline licensing requirements. 

The statutory authority for the rules is found at § § 12-14-114, and 24-4-103, C.R.S.