California Senate approves stricter rules on debt collection
Senators approved tougher regulations on the debt collection industry on Tuesday, a move hailed by consumer advocates as an important step toward protecting California residents from unscrupulous collectors.
Under the proposal, companies that buy up consumer debt and then seek to collect outstanding payments would be required to provide additional documentation to prove they’re seeking the right amount of money from the right person.
“It’s really gotten out of control, and a lot of innocent people have been caught up,” said Sen. Mark Leno (D-San Francisco), who has been pushing the bill.
One of those people was Leno’s colleague, Sen. Lou Correa (D-Anaheim). He was wrongly targeted by a debt collector who was seeking $4,000 from someone with a similar name, leading to a court order to garnish his wages.
Leno’s bill passed the Senate largely along party lines by a vote of 22 to 14. It now goes to the Assembly, where it will need to pass before heading to Gov. Jerry Brown’s desk.
Opponents say the proposal would create an unfair burden on debt buyers, requiring excessive documentation and making it more difficult to collect in legitimate circumstances.
State Atty. Gen. Kamala Harris disagreed.
"Too often, a consumer can get ensnarled in a long and costly battle to prove they are not the ones responsible for debt," she said in a statement. "The Fair Debt Buyers Practices Act will put reasonable requirements on debt buyers and ensure consumers are not forced to pay the debts of others."
-- Chris Megerian in Sacramento