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Regular Session, 2010
SENATE BILL NO. 130
BY SENATOR MORRELL
SOCIAL SERVICES DEPT. Provides for collection of child support by private party
agencies. (gov sig)
AN ACT1
To enact R.S. 46:236.1.5(D) and Chapter 13-D of Title 51 of the Louisiana Revised Statutes2
of 1950, to be comprised of R.S. 51:1441 through 1449, relative to child support; to3
provide relative to the collection of child support through private party child support4
collection agencies; to provide for definitions; to provide for the regulation of5
services of private party child support collection agencies; to provide relative to6
prohibited practices and penalties; and to provide for related matters.7
Be it enacted by the Legislature of Louisiana:8
Section 1. R.S. 46:236.1.5(D) is hereby enacted to read as follows: 9
§236.1.5. Family and child support programs; FITAP; other service recipients;10
rights; responsibilities11
* * *12
D. No applicant or recipient who has accepted FITAP for or on behalf13
of himself or another individual shall be permitted to enter into a contract for14
the collection of support pursuant to R.S. 51:1441 et seq. Any such contract15
shall be considered a violation of public policy and shall be void. 16
Section 2. Chapter 13 -B of Title 51 of the Louisiana Revised Statutes of 1950,17 SB NO. 130
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comprised of R.S. 51:1441 through 1449, is hereby enacted to read as follows:1
CHAPTER 13-B. LOUISIANA CHILD SUPPORT2
COLLECTION PROTECTION ACT3
§1441. Short title4
This Chapter shall be known and may be cited as the "Louisiana Child5
Support Collection Protection Act".6
§1442. Definitions7
As used in this Chapter, the following words and phrases shall have the8
following meanings:9
(1) "Arrears" or "arrearages" means amounts of past due and unpaid10
monthly support obligations established by a court order issued by any court11
of this state or another state, including any judgment or order issued in12
accordance with an administrative procedure established by state law that13
affords substantial due process and is subject to judicial review, or any other14
judgment created by operation of any state law.15
(2) "Child support" means any amount required to be paid pursuant to16
a court order issued by any court of this state or another state, including any17
judgment or order issued in accordance with an administrative procedure18
established by state law that affords substantial due process and is subject to19
judicial review.20
(3) "Contract" means a contract or agreement, as described in R.S.21
51:1444, pursuant to which a private child support collection agency agrees to22
perform support enforcement services for an obligee for a fee or other23
compensation.24
(4) "Department" means the Department of Social Services, office of25
family support, support enforcement services.26
(5) "FITAP" means Family Independence Temporary Assistance27
Program.28
(6) "Obligee" means an individual who is owed child support under a29 SB NO. 130
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child support order and who has entered or may enter into a contract with a1
collection agency.2
(7) "Obligor" means a resident of this state who is identified in an order3
of support issued by a court or other tribunal as required to make child support4
payments.5
(8) "Order of support" or "child support order" means any judgment6
or order for the support of dependent children issued by any court of this state7
or another state, including any judgment or order issued in accordance with an8
administrative procedure established by state law that affords substantial due9
process and is subject to judicial review.10
(9)(a) "Private child support collection agency" or "collection agency"11
means an individual or nongovernmental entity that solicits and contracts12
directly with obligees to provide child support collection services for a fee or13
other compensation.14
(b) For the purposes of this chapter, the following persons or entities are15
not considered a private child support collection agency:16
(i) The department or any government agency providing services in17
accordance with Title IV-D of the Social Security Act and corresponding state18
laws and regulations;19
(ii) An attorney duly licensed to practice law in the state of Louisiana if20
such an attorney meets one of the following:21
(aa) Is not employed by a private child support collection agency.22
(bb) Does not derive a substantial portion of his business from the23
collection or enforcement of child support. As used in this Subitem,24
"substantial" means that at least fifty percent of the attorney's business, either25
in terms of remuneration or time spent, is comprised of the activity of seeking26
to collect or enforce child support obligations for other individuals.27
(iii) A collection agency that performs support enforcement services28
while under contract with the department to provide such services in29 SB NO. 130
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accordance with Title IV-D of the Social Security Act and corresponding state1
laws and regulations.2
(iv) A public officer, judicial officer, receiver, or trustee acting under the3
order of a court.4
(10) "Support services" and "support enforcement services" means:5
(a) Any action taken by the Department of Social Services, upon receipt6
of an application or referral for services or a request made under the Uniform7
Interstate Family Support Act, in accordance with the federal requirements of8
Title IV-D of the Social Security Act and corresponding state laws and9
regulations without regard to whether there is any existing court order,10
delinquency, or presumption of paternity.11
(b) A service, including related financial accounting services, performed12
directly or indirectly for the purpose of causing a payment required, or13
allegedly required, by an order of support to be made to the obligee to whom14
the payment is owed or to an agent of that individual.15
§1443. Registration16
Any private child support collection agency intending to provide support17
enforcement services to an obligee who is a resident of this state or collect any18
child support or arrearages from an obligor shall:19
(1) Register with the secretary of state and provide information as20
requested by the secretary of state, including but not limited to the name of the21
private child support collection agency and the office address for such entity,22
and the registered agent in this state on whom service of process is to be made23
in a proceeding against such private child support collection agency.24
(2) Provide with the registration information:25
(a) A surety bond filed, held, and approved by the state treasurer. The26
surety bond shall be issued by a surety authorized to do business in this state in27
the amount of fifty thousand dollars in favor of the state for the benefit of a28
person damaged by a violation of this Chapter, and conditioned on the private29 SB NO. 130
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child support collection agency's compliance with this Chapter and the faithful1
performance of the obligations under the private child support collection2
agency's agreements with its clients.3
(b) A deposit of money in the amount of fifty thousand dollars may be4
made in lieu of the surety bond. The state treasurer shall deposit any amounts5
received under this Chapter in an insured depository account.6
§1444. Contracts between obligees and private child support collection7
agencies; contents; provisions8
A. Any contract for the collection of child support between a private9
child support collection agency and an obligee shall be in writing, in at least10
ten-point font or the equivalent, and dated and signed by the obligee and an11
authorized representative of the collection agency. The contract shall be12
delivered to the obligee in paper form that the obligee may retain for his13
records. The contract shall include:14
(1) A clear description of the child support enforcement services that15
may be provided pursuant to the contract.16
(2) An explanation of the amount to be collected from the obligor by the17
private child support collection agency and a statement of a sum certain of the18
total amount that is to be collected by the private child support collection19
agency that has been engaged by the obligee.20
(3) An explanation in dollar figures of the maximum amount of fees21
which could be collected under the contract and an example of how the fees are22
calculated and deducted.23
(4) A statement that fees shall be charged only for collecting past due24
child support, even if the contract includes provisions to collect current and past25
due child support.26
(5) A statement that a private child support collection agency shall not27
retain fees from collections that are primarily attributable to the actions of the28
department and that a private child support collection agency shall be required29 SB NO. 130
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by law to refund any fees improperly retained to the appropriate party.1
(6) An explanation of the opportunities available to the obligee or2
private child support collection agency to cancel the contract or other3
conditions under which the contract terminates.4
(7) The mailing address, street address, telephone numbers, facsimile5
numbers, and Internet address or location of the collection agency and any6
agents who assist the collection agency in providing support enforcement7
services.8
(8) A statement that the private child support collection agency shall9
collect only money owed to the obligee and not child support assigned to the10
state of Louisiana.11
(9) A statement that the private child support collection agency is not a12
government agency and is not affiliated with any government agency and that13
the department provides support enforcement services at little or no cost to the14
obligee.15
(10) A statement that the obligee may continue to receive, or may16
pursue, support enforcement services through the department, and the private17
child support collection agency will not require or request that the obligee cease18
or refrain from engaging those services.19
(11) A provision that the collection agency cannot alienate, encumber,20
sell or assign any rights to the contract to a third party. This shall include using21
the contract as collateral to secure any debt owed by the collection agency to a22
third party.23
(12) A copy of any other document the collection agency requires the24
obligee to sign.25
(13) A notice that the private child support collection agency is required26
to keep and maintain case records for a period of two years after the27
termination of the contract and may thereafter destroy or otherwise dispose of28
the records. The obligee may, prior to destruction or disposal, retrieve his29 SB NO. 130
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entire record.1
(14) The expected duration of the contract, stated as a length of time or2
as an amount to be collected by the collection agency.3
(15) An explanation of the opportunities available to the obligee or4
private child support collection agency to cancel the contract or other5
conditions under which the contract terminates. This explanation shall be6
attached to the contract as an addendum written in the same size font as the7
contract and contain all of the provisions included in Subsection D of this8
Section. The explanation shall be signed and dated by the obligee.9
B. A private child support enforcement service contract shall not10
include:11
(1) A requirement, as a condition of providing services to the obligee,12
that the obligee waive any right or procedure provided for in any state law13
regarding the right to file and pursue a civil or criminal action, or that the14
obligee agree to resolve disputes in a jurisdiction outside of the obligee's state15
of residence or to the application of laws other than those of the obligee's state16
of residence. Any waiver, including but not limited to an agreement to arbitrate17
or regarding choice of forum or choice of law, that is required as a condition of18
doing business with the private child support collection agency shall be19
presumed against public policy and unenforceable.20
(2) A clause that requires the obligee to change the payee or redirect21
child support payments that would otherwise be payable to the obligee, the22
department or other agency administering a state plan approved under Title23
IV-D of the Social Security Act and corresponding state laws and regulations,24
or a state disbursement unit, if payment is ordered to be made through a state25
disbursement unit.26
(3) A clause that requires the obligee to close, or not open, a child27
support case with the department or other agency administering a state plan28
approved under Title IV-D of the Social Security Act and corresponding state29 SB NO. 130
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laws and regulations.1
(4) A clause that requires the obligee to waive his or her rights to review2
and consent to any modification of a contract entered into by the obligee.3
(5) A clause that prohibits the termination of a contract for the4
collection of child support payments until arrears are paid.5
(6) Any provision requesting or requiring an obligee to waive the right6
of the obligee to accept a settlement offer.7
C. A private child support enforcement contract may not be modified8
by subsequent agreement unless the obligee has signed the subsequent9
agreement after receiving a written copy of the modifications.10
D. In addition to any other cancellation or termination provisions11
provided in the contract between a private child support collection agency and12
an obligee, the contract shall be cancelled or terminate if:13
(1) The obligee requests cancellation in writing within thirty days of14
signing the contract.15
(2) No payment of child support has been collected by such debt16
collection agency for a period of six consecutive months.17
(3) The private child support collection agency breaches any term of the18
contract or violates any provision contained in this Chapter.19
(4) The contract term has expired or the contract amount has been20
collected, whichever occurs first.21
§1445. Duties of private child support collection agencies22
A private child support collection agency shall:23
(1) Enter into a written contract with a child support obligee before24
providing support enforcement services. The provisions of the contract shall25
conform to R.S. 51:1444.26
(2) Have an affirmative duty to act as a trustee and fiduciary for the27
benefit of the obligee.28
(3) Advise an obligee before entering into a contract with him that the29 SB NO. 130
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obligee is under no obligation to hire a private child support collection agency1
to collect child support payments on the obligee's behalf.2
(4) Provide the obligee and the department, when the department is3
providing support enforcement services to the obligee, with an accounting of4
any money collected and forwarded to the obligee as child support or5
arrearages every thirty days until the collection agency ceases all collection6
activity. The statement shall be sent by first class mail by the collection agency.7
The statement shall contain all of the following information:8
(a) The name of, and any other identifying information relating to, any9
obligor who made child support payments collected by the private child support10
collection agency.11
(b) The amount of support collected by the private child support12
collection agency.13
(c) The date on which each amount was received by the private child14
support collection agency.15
(d) The date on which each amount received by the private child support16
collection agency was sent to the obligee.17
(e) The amount of the payment sent to the obligee.18
(f) The source of payment of support collected and the actions19
affirmatively taken by the private child support collection agency that resulted20
in the payment.21
(g) The amount and percentage of each payment kept by the private22
child support collection agency as its fee.23
(h) A copy of all correspondence, both paper and electronic, sent or24
received by the collection agency during the preceding thirty days. This25
provision shall not apply to correspondence required by law to be kept26
confidential.27
(5) Any private child support collection agency that collects child28
support pursuant to a contract in accordance with R.S. 51:1444 shall forward29 SB NO. 130
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that portion of the collections due to the obligee within two days of receipt.1
(6) Maintain records of all child support collections made on behalf of2
an obligee. The records required under this Section shall be maintained by the3
private child support collection agency for the duration of the contract plus a4
period of two years after the termination of the contract. In addition to a copy5
of the contract, the private child support collection agency shall maintain the6
following:7
(a) A copy of the order establishing the child support obligation under8
which a collection was made by the private child support collection agency.9
(b) Records of all correspondence between the private child support10
collection agency and the obligee or obligor in a case.11
(c) Any other pertinent information relating to the child support12
obligation, including any case, cause, or docket number of the court having13
jurisdiction over the matter and official government payment records obtained14
by the private child support collection agency on behalf of and at the request of15
the obligee.16
(7) Safeguard case records in a manner reasonably expected to prevent17
intentional or accidental disclosure of information contained therein pertaining18
to the obligee or obligor, to anyone other than the obligee, obligor or the19
department, including providing necessary protections for records maintained20
in an automated system.21
(8) Ensure that every person who contracts with a private child support22
collection agency has the right to obtain copies of all files and documents, both23
paper and electronic, in the possession of the private child support collection24
agency for the information specified in this Paragraph regarding that obligee's25
case that are not required by law to be kept confidential. The obligee shall be26
provided reasonable access during regular business hours to originals and27
copies of the files and records of the private child support collection agency28
regarding all monies received, collection attempts made, fees retained or paid29 SB NO. 130
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to the private child support collection agency, and monies disbursed to the1
obligee. The private child support collection agency may not charge a fee for2
access to the files and records but may require the obligee to pay up to three3
cents per page for the copies prior to their release. This fee shall not apply to4
documents sent with a statement pursuant to Paragraph (4) of this Section.5
(9) Convey any offer of settlement or compromise made by the obligor6
to the obligee in writing.7
(10) Maintain a separate bank account for child support funds collected8
on behalf of obligees and keep such funds in the bank account until disbursed9
to the appropriate obligee.10
(11) Notwithstanding any other provision of this Chapter, including11
provisions establishing a right of cancellation and requiring notice thereof, any12
contract for the collection of child support between an attorney who meets the13
definition of "private child support collection agency" pursuant to R.S.14
51:1441(I) shall conform to the statutes, rules, and case law governing attorney15
conduct.16
§1446. Provision of support enforcement services by a private child support17
collection agency; prerequisites18
Before commencing support enforcement services, a private child19
support collection agency shall:20
(1) Obtain from the obligee:21
(a) A certified copy of the order of support.22
(b) A statement executed by the obligee under oath containing the23
arrears balance and the dates during which the arrears balance accrued.24
(c) Any judgments in existence at the time the contract is signed by the25
obligee setting the arrears owed under the order of support in Subparagraph26
(2)(a) of this Section.27
(d) A statement executed by the obligee under oath stating that the28
obligee is not receiving FITAP for, or on behalf of, himself or another29 SB NO. 130
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individual.1
(2) Send the obligor a written notice no later than five days after the2
obligee and collection agency sign the contract.3
(a) The notice shall contain the following:4
(i) The name of the obligee.5
(ii) A statement of the amount of the child support arrears, including6
any associated interest, late payment fee, or other charge authorized by law, and7
of the amount of the current child support owed by the obligor to the obligee.8
(iii) A statement that the collection agency assumes that the obligor owes9
child support or arrears to the obligee and that the amounts owed as described10
in the statement pursuant to this Paragraph are correct, unless the obligor11
disputes the existence or amount of the child support obligation within thirty12
days after receipt of the notice.13
(iv) A statement that if, within the thirty day period established in Item14
(2)(a)(iii) of this Section, the obligor notifies the collection agency in writing that15
the obligor disputes the existence or amount of the child support obligation or16
arrears, the collection agency will cease efforts to collect the child support,17
subject to Subparagraph (2)(b) of this Section, until the collection agency:18
(aa) Obtains written verification of the existence or amount of the19
obligation or arrears, unless the obligee has provided a judgment under20
Subparagraph (1)(c) of this Section.21
(bb) Mails to the obligor a copy of the verification or judgment.22
(v) A statement that the arrears balance reflected does not include any23
amounts owed to the department or any other state agency administering a state24
plan approved under Title IV-D of the Federal Social Security Act, as amended.25
(b) A statement made by a collection agency pursuant to Item (2)(a)(iv)26
of this Section shall not affect the enforceability of a valid income-withholding27
order or assignment issued by the department or any other state agency28
administering a state plan approved under Title IV-D of the Federal Social29 SB NO. 130
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Security Act, as amended.1
(3) The failure of an obligor to dispute the amount or existence of child2
support or arrears pursuant to Item (2)(a)(iii) of this Section shall not be3
construed as an admission of liability by the obligor.4
§1447. Prohibited practices5
For the purposes of this Chapter, any attempt to collect a child support6
obligation or arrearage shall be deemed unfair, deceptive or unreasonable if the7
collection agency:8
(1) Attempts to collect child support or arrears from an obligor by any9
threat, coercion or attempt to coerce, including, but not limited to:10
(a) The use, or the express or implicit threat of use, of violence or other11
criminal means, to cause harm to the person, reputation or property of any12
person.13
(b) The accusation or threat to accuse any person of fraud, of any crime,14
or of any conduct which, if true, would tend to disgrace the other person or in15
any way subject them to ridicule or contempt of society.16
(c) False accusations made to another person, including any credit17
reporting agency, that a person is willfully refusing to pay child support or18
arrears, or the threat to make such false accusations.19
(d) The threat that nonpayment of child support or arrears will result20
in the arrest of any person, or of the taking of any other action requiring21
judicial sanction, without informing the person that there must be in effect a22
court order permitting the action before it can be taken.23
(e) The threat to take any action prohibited by this Section or other law24
regulating the conduct of a collection agency.25
(2) Unreasonably oppresses or abuses any person in connection with the26
attempt to collect any child support obligation or arrearage, including but not27
limited to:28
(a) The use of profane or obscene language or language that is intended29 SB NO. 130
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to abuse the listener or reader.1
(b) Causing a telephone to ring or engaging any person in telephone2
conversation repeatedly or continuously, or at any time from nine o'clock p.m.3
to 8 o'clock a.m. local time, or at times known to be inconvenient with the intent4
to abuse, oppress or harass any person at the called number.5
(c) Causing expense to any person in the form of long distance telephone6
tolls, telegram fees or other charges incurred by a medium of communication7
by concealment of the true purpose of the communication.8
(3) Unreasonably publicizes information relating to any alleged child9
support obligation or arrearage, including but not limited to:10
(a) Communicating to any employer or his agent any information11
relating to an obligor's indebtedness other than through proper legal action,12
process or proceeding.13
(b) Disclosing, publicizing or otherwise communicating any information14
relating to a child support obligation or arrearage to any relative or family15
member of the obligor, except through proper legal action or process or at the16
written, express and unsolicited request of the obligor.17
(c) Disclosing, publicizing or otherwise communicating any information18
relating to an obligor's child support obligation or arrearage to any other19
person other than a credit reporting agency, by publishing or posting any list20
of persons, commonly known as "deadbeat lists" or in any manner other than21
through proper legal action, process or proceeding.22
(d) Using any form of communication to the obligor, which may be seen23
by any other person, that displays or conveys any information about the alleged24
claim other than the name, address and telephone number of the collection25
agency.26
(4) Uses any fraudulent, deceptive or misleading representation or27
means to attempt to collect a child support obligation or arrearage or to obtain28
information concerning obligors, including but not limited to:29 SB NO. 130
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(a) The use of any business, company or organization name while1
engaged in the collection of child support or arrears, other than the true name2
of the collection agency's business, company or organization.3
(b) Making any false representation that the collection agency has in its4
possession information or something of value for the obligor with the5
underlying purpose of soliciting or discovering information about the person.6
(c) Asking any party other than the obligor to pay the child support7
obligation, unless that party is legally responsible for the obligation or is the8
legal representative of the obligor.9
(d) Making any false representation or implication of the character,10
extent or amount of a claim against an obligor, or of the status of any legal11
proceeding.12
(e) Making any false representation or false implication that any13
collection agency is vouched for, bonded by, affiliated with an agency,14
instrumentality, agent or official of this state or of the federal or local15
government.16
(f) The use, distribution or sale of any written communication which17
simulates or is falsely represented to be a document authorized, issued or18
approved by a court, an official or any other legally constituted or authorized19
authority, or which creates a false impression about its source, authorization or20
approval.21
(g) Any representation that an existing obligation of the obligor may be22
increased by the addition of attorney fees, investigation fees, service fees or any23
other fees or charges when in fact the fees or charges may not legally be added24
to the existing obligation.25
(h) Any false representation or false impression about the status or true26
nature of the services rendered by the collection agency.27
(5) Uses unfair or unconscionable means to attempt to collect any child28
support obligation or arrearage, including but not limited to the collection of or29 SB NO. 130
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the attempt to collect any interest, fee or expense in excess of what is authorized1
by the provisions of state law.2
(6) Uses, distributes, sells or prepare for use any written communication3
which violates or fails to conform to United States postal laws and regulations4
or uses a method contrary to a postal law or regulation to collect an account.5
(7) Places a telephone call or otherwise communicates by telephone with6
any person at any place, including a place of employment, and falsely states that7
the call is urgent or an emergency.8
(8) Communicates or attempts to communicate with the obligor in the9
following manner:10
(a) At the obligor's place of employment, if the place is not also the11
obligor's residence, with the understanding that:12
(i) A collection agency may send a single letter to the obligor at his place13
of employment if the agency has otherwise been unable to locate the obligor.14
(ii) A collection agency may phone the obligor at his place of15
employment if the agency is unable to contact the obligor at his residence,16
provided that:17
(aa) The obligor does not inform the collection agency that he does not18
wish the collection agency to communicate or attempt to communicate with him19
at his place of employment.20
(bb) The collection agency shall not inform the employer of the nature21
of the call unless asked by the employer.22
(cc) In no event shall the collection agency make more than one phone23
call per month to the obligor at his place of employment unless the obligor24
affirmatively indicates in writing that he desires the collection agency to call25
him at his place of employment.26
(b) Using any written communication which fails to clearly identify the27
name of the collection agency, the name of the obligee for whom the collection28
agency is attempting to collect the debt, and the collection agency's business,29 SB NO. 130
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unless identifying the obligee would violate Subparagraph (3)(d) of this Section.1
(c) By placing of phone calls without disclosure of the name of the2
individual making the call and the name of the obligee for whom the collection3
agency is attempting to collect the debt, or by using a fictitious name while4
engaging in the collection of debts.5
(d) When the obligor is represented by an attorney, the attorney's name6
and address are known by the collection agency unless:7
(i) The attorney representing the debtor fails to answer written8
communication, or fails to discuss the claim within thirty days after receipt of9
written communication.10
(ii) Communication with the obligor takes place through billing11
procedures.12
(e) Through the use of forms or instruments which simulate the form13
and appearance of judicial process or which give the appearance of being14
authorized, issued or approved by a court of law, government agency, or15
attorney-at-law when they are not.16
(f) In any manner that violates any other provision of this Section.17
(9) Imposes a charge or fee for the costs of an application.18
(10) Imposes a fee or charge, including costs, for any child support19
payments collected through the efforts of a federal, state, or local government20
agency, including but not limited to child support collected from federal or state21
tax refunds, judgments, settlements, lotteries, public or private retirement22
funds, liens, workers' compensation, unemployment benefits, or Social Security23
benefits. If the department or obligee notifies a private child support collection24
agency in writing of such improper fee retention, the private child support25
collection agency shall refund such fees to the obligee within seven days of the26
notification of the improper retention of fees and shall not be liable for such27
improper fee retention under R.S. 51:1448(A).28
(11) Charge fees to the obligee in excess of twenty percent of the total29 SB NO. 130
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words in boldface type and underscored are additions.
amount of each child support payment collected.1
(12) Charge the obligee interest or otherwise impose a charge or fee for2
a current payment of child support.3
(13) Fail to implement a procedure designed to prevent a violation by4
an employee.5
(14) Unless licensed to practice law in this state, attempt to collect a6
child support obligation or arrearage by engaging in conduct which is7
considered the practice of law, including but not limited to:8
(a) The performance of legal services, the offering of legal advice or the9
making of a false representation, directly or by implication, that a person is an10
attorney.11
(b) Communicating with persons in the name of an attorney or upon12
stationery or other written matter bearing an attorney's name.13
(c) Making a demand for or payment of money constituting a share of14
compensation for services performed or to be performed by an attorney in15
collecting a claim.16
(d) Impose an additional charge or fee for legal services related to the17
provision of support enforcement services.18
(15) Solicit obligees using marketing materials, advertisements, or19
representations reasonably calculated to create a false impression or mislead an20
obligee into believing the private child support collection agency is affiliated21
with the department or any other government agency providing services in22
accordance with Title IV-D of the Social Security Act and corresponding state23
laws and regulations.24
(16) Contract with an obligee for a sum certain to be collected which is25
greater than the total sum of arrearages and the judicial interest owed as of the26
date of execution of the contract.27
(17) Provide support enforcement services to any obligee if the obligee,28
or any child listed in the support order, is receiving any of the services listed in29 SB NO. 130
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words in boldface type and underscored are additions.
R.S. 46:236.1.2(A).1
(18) Represent in any communication or advertising material that2
results are guaranteed under a contract.3
(19) Designate a current child support payment as a payment to the4
arrears or other amount owed.5
(20) Misrepresent the geographical location of the collection agency by6
listing a fictitious business name or an assumed business name in the classified7
advertising section of a telephone directory or other directory database. The8
collection agency is considered to have misrepresented its geographical location9
if it violates any of the provisions listed in R.S. 51:1420.10
(21) Accept a settlement offer made by an obligor before:11
(a) The collection agency has reviewed all settlement offers with the12
obligee.13
(b) The obligee has given the collection agency express written14
authorization to accept the settlement offer.15
(22) Fail to apply funds collected in any given month to current support16
before applying funds to the arrears or other amounts, unless the contract17
applies to the collection of arrears only.18
(23) Commingle any funds owed to an obligee in accordance with a19
contract with other funds.20
(24) Suggest or instruct that the obligor or the obligor's employer send21
the payment to the collection agency when a child support order directs that22
payment be made through a central payment registry.23
§ 1448. Criminal penalties24
A.(1) A private child support collection agency and any individual25
directly involved in providing support enforcement services under this Chapter26
who willfully violates the provisions of R.S. 51:1447 is guilty of a misdemeanor27
and upon conviction may be sentenced to pay a fine not to exceed two thousand28
dollars, or to imprisonment not to exceed six months, or both.29 SB NO. 130
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words in boldface type and underscored are additions.
(2) A private child support collection agency and any individual directly1
involved in providing support enforcement services under this Chapter who2
willfully violates the provisions of R.S. 51:1443 is guilty of a misdemeanor and3
upon conviction may be sentenced to pay a fine of not less than five hundred4
dollars nor more than one thousand dollars, or to imprisonment not to exceed5
six months, or both.6
B. When the collection agency is incorporated under the laws of any7
state, its officers, directors or stockholders who are not personally involved in8
violations of this Chapter, shall not be subject to the criminal penalties of this9
Section.10
C. The provisions and remedies provided by this Section shall be11
construed as an addition to, and not in substitution for, any other remedy12
otherwise available to any person damaged by a violation of this Chapter.13
Relief under this Section shall not be denied, delayed, or otherwise affected14
because of the availability of other remedies, nor shall relief under any other15
statute be delayed or denied because of the availability of the remedies provided16
by this Section.17
§ 1449. Enforcement and venue18
A. District attorneys and their assistants may institute and prosecute19
actions under R.S. 51:1448.20
B. Venue shall be proper in either of the following:21
(1) In the parish where the obligee resides.22
(2) In the parish where the obligor resides, if the obligee is not a resident23
of this state.24
Section 3. This Act shall become effective upon signature by the governor or, if not25
signed by the governor, upon expiration of the time for bills to become law without signature26
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If27
vetoed by the governor and subsequently approved by the legislature, this Act shall become28
effective on the day following such approval.29 SB NO. 130
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words in boldface type and underscored are additions.
The original instrument was prepared by Bobbie Hunter. The following
digest, which does not constitute a part of the legislative instrument, was
prepared by McHenry Lee.
DIGEST
Morrell (SB 130)
Present law provides for the rights and responsibilities for FITAP recipients.
Proposed law retains present law and provides that FITAP recipients shall not enter into
contracts for the collection of support pursuant to current law. Any such contract shall be
considered a violation of public policy and shall be considered null and void.
Proposed law provides for the Louisiana Child Support Collection Protection Act.
Proposed law provides for the definitions for the following: "arrears or arrearages," "child
support," "contract," "department," "FITAP," "obligee" or "obligor," "order of support" or
"child support order," "private child support collection agency," "support services," and
"support enforcement services."
Proposed law provides that the following shall not be considered private child support
collection agents:
1. The department or any government agency providing services in accordance with
Title IV-D of the Social Security Act and corresponding state laws and regulations.
2. An attorney licensed to practice law in Louisiana if such an attorney is not employed
by a private child support collection agency, or does not derive a substantial portion
of his business from the collection or enforcement of child support.
3. A collection agency that performs support enforcement services while under contract
with the department to provide such services in accordance with such laws.
4. A public officer, judicial officer, receiver, or trustee acting under the order of a court.
Proposed law provides that any private child support collection agency intending to provide
support enforcement services to an obligee who is a resident of this state or collect any child
support or arrearages from an obligor shall register with the secretary of state and shall
provide information as requested by the secretary of state, including, but not limited to, the
name of the private child support collection agency, the office address and for such entity,
and the registered agent in this state on whom service of process is to be made in a
proceeding against such private child support collection agency.
Proposed law provides that in addition to the registration information, either a surety bond
shall be filed, held, and approved by the state treasurer and issued by a surety authorized to
do business in this state in the amount of $50,000.00 in favor of the state, or a deposit of
money in the amount of $50,000.00. The state treasurer shall deposit any amounts received
in an insured depository account.
Proposed law provides for contracts between obligees and private child support collection
agencies. Any contract shall be in writing and shall include the following:
1. A clear description of the services that may be provided pursuant to the contract.
2. An explanation of the amount to be collected from the obligor by the private child
support collection agency and a statement of a sum certain of the total amount that
is to be collected by the private child support collection agency that has been SB NO. 130
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words in boldface type and underscored are additions.
engaged by the obligee.
3. An explanation of the maximum amount of fees which could be collected under the
contract and an example of how the fees are calculated and deducted.
4. A statement that fees shall only be charged for collecting past due child support.
5. A statement that a private child support collection agency shall not retain fees from
collections that are primarily attributable to the actions of the department, and that
a private child support collection agency shall be required by law to refund any fees
improperly retained to the appropriate party.
6. An explanation of the opportunities available to the obligee or private child support
collection agency to cancel the contract.
7. The mailing address, street address, telephone numbers, facsimile numbers, and
Internet address or location of the collection agency and any agents who assist the
collection agency in providing support enforcement services.
8. A statement that the private child support collection agency shall only collect money
owed to the obligee and not child support assigned to the state.
9. A statement that the private child support collection agency is not a government
agency and is not affiliated with any government agency and that the department
provides support enforcement services at little or no cost to the obligee.
10.A statement that the obligee may continue to receive, or may pursue, support
enforcement services through the department.
11.A provision that the collection agency cannot alienate, encumber, sell or assign any
rights to the contract to a third party.
12.A copy of any other document the collection agency requires the obligee to sign.
13.A notice that the private child support collection agency is required to keep and
maintain case records for a period of two years after the termination of the contract
and may thereafter destroy or otherwise dispose of the records. The obligee may,
prior to destruction or disposal, retrieve his or her entire record.
14.The expected duration of the contract.
15.An explanation of the opportunities available to the obligee or private child support
collection agency to cancel the contract or other conditions under which the contract
terminates.
Proposed law provides that private child support enforcement service contract shall not
include the following:
1. A requirement that the obligee waive any right or procedure provided for in any state
law regarding the right to file and pursue a civil or criminal action, or that the obligee
agree to resolve disputes in a jurisdiction outside of the obligee's state of residence,
or to the application of laws other than those of the obligee's state of residence. Any
waiver shall be presumed against public policy and unenforceable.
2. A clause that requires the obligee to change the payee or redirect child support
payments that would otherwise be payable to the obligee, the department or other
agency administering a state plan if payment is ordered to be made through a state
disbursement unit. SB NO. 130
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words in boldface type and underscored are additions.
3. A clause that requires the obligee to close, or not open, a child support case with the
department or other agency administering a state plan.
4. A clause that requires the obligee to waive his rights to review and consent to any
modification of a contract entered into by the obligee.
5. A clause that prohibits the termination of a contract for the collection of child
support payments until arrears are paid.
6. Any provision requesting or requiring an obligee to waive the right of the obligee to
accept a settlement offer.
Proposed law provides that a private child support enforcement contract may not be
modified by subsequent agreement, unless the obligee has signed the subsequent agreement
after receiving a written copy of the modifications. In addition to any other cancellation or
termination provisions provided in the contract between a private child support collection
agency and an obligee, the contract shall be cancelled or terminated if the obligee requests
cancellation in writing within 30 days of signing the contract, no payment of child support
has been collected by such debt collection agency for a period of six consecutive months,
the agency breaches any term of the contract or contract term has expired, or the contract
amount has been collected, whichever occurs first.
Proposed law provides for the duties of private child support collection agencies and requires
such agencies to:
1. Enter into a written contract with a child support obligee before providing support
enforcement services.
2. Act as a trustee and fiduciary for the benefit of the obligee.
3. Advise an obligee before entering into a contract with him or her that the obligee is
under no obligation to hire a private child support collection agency to collect child
support payments.
4. Provide the obligee and the department, when the department is providing support
enforcement services to the obligee, with an accounting of any money collected and
forwarded to the obligee as child support or arrearages every thirty days until the
collection agency ceases all collection activity.
Proposed law requires any private child support collection agency that collects child support
shall forward that portion of the collections due to the obligee within two days of receipt.
Records shall be maintained of all child support collections made on behalf of an obligee for
the duration of the contract plus a period of two years after the termination of the contract.
In addition to a copy of the contract, the agency shall maintain a copy of the order
establishing the child support obligation, records of all correspondence between the private
child support collection agency and the obligee or obligor and any other pertinent
information relating to the child support obligation.
Proposed law provides that case records shall be safeguarded in a manner reasonably
expected to prevent intentional or accidental disclosure of information to anyone other than
the obligee, obligor, or the department, and includes providing necessary protections for
records maintained in an automated system.
Proposed law provides that every person who contracts with a private child support
collection agency has the right to obtain copies of all files and documents, both paper and
electronic, in the possession of the private child support collection agency regarding that
obligee's case that are not required by law to be kept confidential. Proposed law provides
that the obligee shall be provided reasonable access to and copies of the files and records of SB NO. 130
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the private child support collection agency regarding all monies received, collection attempts
made, fees retained or paid to the private child support collection agency, and monies
disbursed to the obligee.
Proposed law requires the private child support collection agency to convey any offer of
settlement or compromise made by the obligor to the obligee in writing. A separate bank
account shall be kept for child support funds collected on behalf of obligees and shall keep
such funds in the bank account until disbursed to the appropriate obligee. Any attorney who
meets the definition of "private child support collection agency" shall conform to the
statutes, rules, and case law governing attorney conduct.
Proposed law provides for prerequisites for private child support collection agencies before
commencing support enforcement services. The agency shall obtain from the obligee a
certified copy of the order of support, a statement executed by the obligee under oath
containing the arrears balance and the dates during which the arrears balance accrued, and
any judgments in existence at the time the contract is signed by the obligee setting the
arrears owed under the order of support. Proposed law further provides that the agency shall
obtain a statement executed by the obligee under oath stating that the obligee is not receiving
FITAP for, or on behalf of, himself or another individual.
Proposed law provides that the private child support collection agency send the obligor a
written notice no later than five days after the obligee and collection agency sign the
contract. Such notice shall contain the name of the obligee, a statement of the amount of the
child support arrears, including any associated interest, late payment fee, or other charge
authorized by law, and of the amount of the current child support owed by the obligor to the
obligee.
Proposed law provides that the written notice shall contain a statement that the collection
agency assumes that the obligor owes child support or arrears to the obligee and that the
amounts owed as described in the statement are correct, unless the obligor disputes the
existence or amount of the child support obligation within 30 days after receipt of the notice.
If within the 30 days the obligor notifies the collection agency in writing that the obligor
disputes the existence or amount of the child support obligation or arrears, the collection
agency will cease efforts to collect the child support, subject to certain conditions.
Proposed law further provides that statement made by a collection agency shall not affect
the enforceability of a valid income-withholding order or assignment issued by the
department or any other state agency administering a state plan. The failure of an obligor
to dispute the amount or existence of child support or arrears shall not be construed as an
admission of liability by the obligor.
Proposed law provides for prohibited practices in any attempt to collect a child support
obligation or arrearage deemed unfair, deceptive or unreasonable if the collection agency
does the following:
1. Attempts to collect child support or arrears from an obligor by any threat, coercion
or attempt to coerce, including, but not limited to the use of violence, or to cause
harm to a person.
2. Unreasonably oppresses or abuses any person in connection with the attempt to
collect any child support obligation or arrearage.
3. Unreasonably publicizes information relating to any alleged child support obligation
or arrearage.
4. Uses any fraudulent, deceptive or misleading representation or means to attempt to
collect child support obligation or arrearage or to obtain information concerning
obligors. SB NO. 130
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
5. Uses unfair or unconscionable means to attempt to collect any child support
obligation or arrearage, including, but not limited to the collection of or the attempt
to collect any interest, fee or expense in excess of what is authorized by the
provisions of state law.
6. Uses, distributes, sells or prepares for use any written communication which violates
or fails to conform to U.S. postal laws and regulations or uses a method contrary to
a postal law or regulation to collect an account.
7. Places a telephone call or otherwise communicates by telephone with any person at
any place, including a place of employment, and falsely states that the call is urgent
or an emergency.
8. Communicates, or attempts to communicate with the obligor at the obligor's place
of employment if said place is not also the obligor's residence, uses any written
communication which fails to clearly identify the name of the collection agency, the
name of the obligee for whom the collection agency is attempting to collect the debt,
and the collection agency's business, unless identifying the obligee would violate
proposed law.
9. Phone calls shall not be made without disclosure of the name of the individual
making the call and the name of the obligee for whom the collection agency is
attempting to collect the debt, or by using a fictitious name while engaging in the
collection of debts.
10.Imposes a charge or fee for the costs of an application, or imposes a fee or charge,
including costs, for any child support payments collected through a federal, state, or
local government agency, including but not limited to child support collected from
federal or state tax refunds, judgments, settlements, lotteries, public or private
retirement funds, liens, workers' compensation, unemployment benefits, or Social
Security benefits. If the department or obligee notifies a private child support
collection agency in writing of such improper fee retention, the private child support
collection agency shall refund such fees to the obligee within seven days of the
notification of the improper retention of fees and shall not be liable for such
improper fee retention under proposed law.
11.Charge fees to the obligee in excess of 15% of the total amount of each child support
payment collected, or charge the obligee interest or other fees for a current payment
of child support.
12.Fail to implement a procedure designed to prevent a violation by an employee, and
unless licensed to practice law in this state, attempt to collect a child support
obligation or arrearage by engaging in conduct which is considered the practice of
law.
13.Solicit obligees using marketing materials, advertisements, or representations
reasonably calculated to create a false impression or mislead an obligee into
believing the private child support collection agency is affiliated with the department
or any other government agency providing services.
14.Contract with an obligee for a sum which is greater than the total sum of arrearages
and the judicial interest owed as of the date of execution of the contract.
15.Provide support enforcement services to any obligee if the obligee, or any child listed
in the support order, is receiving any of the services listed in R.S. 46:236.1.2(A).
16.Represent in any communication or advertising material that results are guaranteed
under a contract. SB NO. 130
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words in boldface type and underscored are additions.
17.Designate a current child support payment as a payment to the arrears or other
amount owed.
18.Misrepresent the geographical location of the collection agency by listing a fictitious
business name or an assumed business name in the classified advertising section of
a telephone directory or other directory database.
19.Accept a settlement offer made by an obligor before the collection agency has
reviewed all settlement offers with the obligee and the obligee has given the
collection agency written authorization to accept the settlement offer.
20.Fail to apply funds collected in any given month to current support before applying
funds to the arrears or other amounts, unless the contract applies to the collection of
arrears only.
21.Commingle any funds owed to an obligee in accordance with a contract with other
funds.
22.Suggest or instruct that the obligor or the obligor's employer send the payment to the
collection agency when a child support order directs that payment be made through
a central payment registry.
Proposed law provides criminal penalties for a private child support collection agency, and
any individual directly involved in providing support enforcement services, who violates the
provisions in proposed law, and is guilty of a misdemeanor and upon conviction may be
sentenced to pay a fine not to exceed $2,000, or to imprisonment not to exceed 6 months, or
both.
Proposed law provides that when a collection agency is incorporated under the laws of any
state, its officers, directors or stockholders who are not personally involved in violations
shall not be subject to the criminal penalties.
Proposed law provides that notwithstanding any provision of law to the contrary, criminal
penalties provided in proposed law shall be construed as an addition to, and not in
substitution for, any other remedy otherwise available to any person damaged by a violation
of proposed law.
Proposed law provides that district attorneys may enforce and prosecute violations of
proposed law in the parish where the obligee resides or in the parish where the obligor
resides.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Adds R.S. 46:236.1.5(D) and R.S. 51:1441-1449)
Summary of Amendments Adopted by Senate
Senate Floor Amendments to engrossed bill.
1. Changes required registry information for private child support collection
agencies.
2. Changes provision requiring private child support collection agencies to file
surety bonds from being filed, held, and approved by the secretary of state
to be filed, held, and approved by the state treasurer.
3. Legislative Bureau technical amendment.