Debt Buyer/Collection Bill Passes California Senate

The California Senate Friday voted to pass a bill that would require debt buyers in the state to have in their possession a long list of account information before debt collection efforts can begin.

SB 233 passed the full Senate Friday on a unanimous (36-0) vote. The bill, also called the Fair Debt Buying Practices Act, is the latest iteration of bills that have been introduced in each of the three most recent sessions of the state legislature.

Other efforts have been authored by Sen. Mark Leno (D-San Francisco), the sponsor of this year’s SB 233. Last year, his SB 890 passed the full Senate and made it through at least one Assembly committee before dying in another committee. The previous year, the bill never made it out of its first Senate committee.

Most significantly, the bill places a long list of requirements on purchasers of charged-off consumer debt that must be met before collection efforts can begin. Debt buyers must have in their possession proof that they are the sole owner of the debt, the account balance at chargeoff, date of default or last payment, name and address of both the creditor and debtor, and a complete chain of title on the account if bought and sold multiple times.

The bill will now be considered by California’s General Assembly.