HOUSE BILL 24-1380
BY REPRESENTATIVE(S) Mabrey, Boesenecker, Brown, Duran, Epps,
Froelich, Garcia, Hamrick, Hernandez, Herod, Jodeh, Kipp, Lieder,
Lindsay, Ortiz, Rutinel, Sirota, Story, Titone, Velasco, Vigil, Weissman,
Willford, Amabile, Clifford, Ricks, Valdez;
also SENATOR(S) Cutter and Jaquez Lewis, Coleman, Danielson, Exum,
Gonzales, Hinrichsen, Kolker, Marchman, Michaelson Jenet, Priola,
Roberts, Rodriguez, Winter F.
C
ONCERNING MEASURES TO INCREASE CONSUMER PROTECTIONS IN
TRANSACTIONS WITH DEBT
-RELATED SERVICES.
Be it enacted by the General Assembly of the State of Colorado:
SECTION 1. In Colorado Revised Statutes, 5-16-111, add (1.5) as
follows:
5-16-111. Legal actions by collection agencies. (1.5) A
DEBT
COLLECTOR OR COLLECTION AGENCY THAT IS NOT A CREDITOR OR DEBT
BUYER SHALL NOT BE THE NAMED PLAINTIFF IN A LEGAL ACTION OR TAKE
ANY LEGAL ACTION ON A DEBT AGAINST A CONSUMER UNLESS THE DEBT
COLLECTOR OR COLLECTION AGENCY
:
NOTE: This bill has been prepared for the signatures of the appropriate legislative
officers and the Governor. To determine whether the Governor has signed the bill
or taken other action on it, please consult the legislative status sheet, the legislative
history, or the Session Laws.
________
Capital letters or bold & italic numbers indicate new material added to existing law; dashes
through words or numbers indicate deletions from existing law and such material is not part of
the act. (a) ENSURES THAT THE NAME OF THE ORIGINAL CREDITOR OR
ASSIGNOR AND THE NAME OF THE DEBT COLLECTOR OR COLLECTION AGENCY
ARE INCLUDED IN THE CASE CAPTION OF THE COMPLAINT
, IN THAT ORDER;
AND
(b) HAS A COMPLETE AND EFFECTIVE ASSIGNMENT , INCLUDING
COMPLETE SETTLEMENT AUTHORITY AND AUTHORITY TO RESOLVE THE
LITIGATION
.
SECTION 2. In Colorado Revised Statutes, 5-19-110, add (3), (4),
(5), (6), and (7) as follows:
5-19-110. Powers of administrator of the uniform consumer
credit code and district attorney - subpoenas - hearings - notification
- cease-and-desist orders - definitions. (3) (a) C
REDIT SERVICES
ORGANIZATIONS SHALL FILE A NOTIFICATION WITH
, AND PAY THE FEE
PRESCRIBED IN SUBSECTION
(4) OF THIS SECTION TO, THE ADMINISTRATOR
WITHIN THIRTY DAYS AFTER COMMENCING BUSINESS IN THIS STATE AND
,
THEREAFTER, ON OR BEFORE JULY 1 OF EACH YEAR. THE NOTIFICATION MUST
STATE
:
(I) T
HE NAME OF THE CREDIT SERVICES ORGANIZATION ;
(II) T
HE NAME IN WHICH BUSINESS IS TRANSACTED , IF THE NAME IS
DIFFERENT FROM THE NAME PROVIDED PURSUANT TO SUBSECTION
(3)(a)(I)
OF THIS SECTION;
(III) T
HE ADDRESS OF THE CREDIT SERVICES ORGANIZATION 'S
PRINCIPAL OFFICE
, WHICH MAY BE OUTSIDE OF THIS STATE; AND
(IV) OTHER INFORMATION THE ADMINISTRATOR MAY REQUIRE .
(b) I
F INFORMATION IN A NOTIFICATION BECOMES INACCURATE AFTER
FILING
, NO FURTHER NOTIFICATION IS REQUIRED UNTIL THE FOLLOWING
YEAR
'S NOTIFICATION FILING IS DUE.
(4) A
PERSON REQUIRED TO FILE THE NOTIFICATION DESCRIBED IN
SUBSECTION
(3) OF THIS SECTION SHALL PAY TO THE ADMINISTRATOR A
NONREFUNDABLE ANNUAL NOTIFICATION FEE
. THE ADMINISTRATOR MAY
EXAMINE THE TRANSACTIONS
, BUSINESS, AND RECORDS OF A PERSON THAT
PAGE 2-HOUSE BILL 24-1380 FILES A NOTIFICATION WITHOUT ISSUANCE OF A SUBPOENA .
(5) T
HE STATE TREASURER SHALL CREDIT ALL FEES COLLECTED
UNDER THIS PART
1 TO THE CONSUMER CREDIT UNIT CASH FUND .
(6) (a) A
FTER NOTICE AND HEARING , THE ADMINISTRATOR MAY
ORDER A PERSON TO CEASE AND DESIST FROM ENGAGING IN VIOLATIONS OF
THIS CODE OR ANY RULE OR ORDER LAWFULLY MADE PURSUANT TO THIS
PART
1. THE ORDER ISSUED BY THE ADMINISTRATOR MAY REQUIRE THE
PERSON TO PAY TO A BUYER A REFUND OF UNLAWFUL CHARGES UNDER THIS
PART
1 CHARGED TO THE BUYER AND TO PAY AN ADMINISTRATIVE PENALTY
OF UP TO ONE THOUSAND FIVE HUNDRED DOLLARS PER VIOLATION
.
(b) T
HE STATE TREASURER SHALL CREDIT ALL RECEIPTS FROM THE
IMPOSITION OF ADMINISTRATIVE PENALTIES UNDER THIS SECTION TO THE
CONSUMER CREDIT UNIT CASH FUND
.
(c) A
RESPONDENT AGGRIEVED BY AN ORDER OF THE
ADMINISTRATOR MAY SEEK JUDICIAL REVIEW OF THE ORDER IN THE
COLORADO COURT OF APPEALS. THE ADMINISTRATOR MAY OBTAIN A COURT
ORDER FOR ENFORCEMENT OF THE ADMINISTRATOR
'S ORDER IN DISTRICT
COURT UNDER SECTION
24-4-106. ALL PROCEEDINGS UNDER THIS SECTION
ARE GOVERNED BY SECTIONS
24-4-105 AND 24-4-106.
(7) A
S USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE
REQUIRES
:
(a) "A
DMINISTRATOR" MEANS THE ADMINISTRATOR OF THE UNIFORM
CONSUMER CREDIT CODE
.
(b) "C
ONSUMER CREDIT UNIT CASH FUND " MEANS THE CONSUMER
CREDIT UNIT CASH FUND CREATED IN SECTION
5-2-302 (11).
SECTION 3. In Colorado Revised Statutes, 5-19-217, amend
(b)(3)(A) and (c)(3) as follows:
5-19-217. Prerequisites for providing debt-management services.
(b) A provider may not furnish or contract to furnish debt-management
services unless the provider, through the services of a counselor or debt
specialist:
PAGE 3-HOUSE BILL 24-1380 (3) If the individual is to make regular, periodic payments:
(A) Has prepared a plan,
AS DEFINED IN SECTION 5-19-202 (13), for
the individual;
(c) Before an individual assents to an agreement to engage in a plan,
a provider shall:
(3) With respect to all creditors identified by the individual or
otherwise known by the provider to be creditors of the individual, provide
the individual with a list of:
(A) Creditors that the provider expects to participate in the plan and
grant concessions;
(B) Creditors that the provider expects to participate in the plan but
not grant concessions;
AND
(C) Creditors that the provider expects not to participate in the plan.
and
(D) All other creditors.
SECTION 4. In Colorado Revised Statutes, 5-19-218, amend (b)
as follows:
5-19-218. Communication by electronic or other means -
definitions. (b) A provider may satisfy the requirements of section
5-19-217, 5-19-219, or 5-19-227 by means of the internet or other electronic
means if the provider obtains a consumer's consent
AT THE TIME OF
SATISFYING THE REQUIREMENTS OF SECTION
5-19-217, 5-19-219, OR
5-19-227 in the manner provided by section 101 (c)(1) of the federal act.
SECTION 5. In Colorado Revised Statutes, 5-19-223, amend
(d)(2)(A)(iii); repeal (d)(4) and (e); and add (d)(2)(C) as follows:
5-19-223. Fees and other charges - rules. (d) The following rules
apply:
(2) If an individual assents to a plan that contemplates that creditors
PAGE 4-HOUSE BILL 24-1380 or debt collectors will settle debts for less than the principal amount of the
debt:
(A) A provider may not request or receive payment of any fee or
consideration until and unless:
(iii) The fee or consideration either: Bears the same proportional
relationship to the total fee for settling the terms of the entire debt balance
as the individual debt amount bears to the entire debt amount, in which case
the individual debt amount and the entire debt amount are those owed at the
time the debt was enrolled in the service; or is a percentage of the amount
saved as a result of the settlement. The percentage charged cannot change
from one individual debt to another. The amount saved is the difference
between the amount owed at the time the debt was enrolled in the plan and
the amount actually paid to satisfy the debt THE FEE OR OTHER CHARGE
COMPLIES WITH RULES THAT THE ADMINISTRATOR ADOPTS PURSUANT TO
SUBSECTION
(d)(2)(C) OF THIS SECTION.
(C) T
HE ADMINISTRATOR MAY ADOPT RULES REGARDING THE FEE OR
CHARGE AUTHORIZED PURSUANT TO SUBSECTION
(d)(2)(A)(iii) OF THIS
SECTION BY
MARCH 1, 2025. THE RULES MUST NOT UNDULY LIMIT
CONSUMER ACCESS TO DEBT MANAGEMENT SERVICES PROGRAMS BASED ON
AVAILABLE STATE AND NATIONAL DATA
.
(4) Except as otherwise provided in section 5-19-228 (d), if an
individual does not assent to an agreement, a provider may receive for
educational and counseling services it provides to the individual a fee not
exceeding one hundred dollars or, with the approval of the administrator,
a larger fee. The administrator may approve a fee larger than one hundred
dollars if the nature and extent of the educational and counseling services
warrant the larger fee.
(e) If, before the expiration of ninety days after the completion or
termination of educational or counseling services, an individual assents to
an agreement, the provider shall refund to the individual any fee paid
pursuant to subsection (d)(4) of this section.
SECTION 6. Act subject to petition - effective date. (1) Except
as specified in subsection (2) of this section, this act takes effect at 12:01
a.m. on the day following the expiration of the ninety-day period after final
PAGE 5-HOUSE BILL 24-1380 adjournment of the general assembly; except that, if a referendum petition
is filed pursuant to section 1 (3) of article V of the state constitution against
this act or an item, section, or part of this act within such period, then the
act, item, section, or part will not take effect unless approved by the people
at the general election to be held in November 2024 and, in such case, will
take effect on the date of the official declaration of the vote thereon by the
governor.
PAGE 6-HOUSE BILL 24-1380 (2) Section 5-19-223 (d)(2)(A)(iii), (d)(4), and (e), Colorado
Revised Statutes, as amended in section 5 of this act, takes effect March 1,
2025.
____________________________ ____________________________
Julie McCluskie Steve Fenberg
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Robin Jones Cindi L. Markwell
CHIEF CLERK OF THE HOUSE SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
(Date and Time)
_________________________________________
Jared S. Polis
GOVERNOR OF THE STATE OF COLORADO
PAGE 7-HOUSE BILL 24-1380