78R4966 DWS-D
By: Elkins H.B. No. 3393
A BILL TO BE ENTITLED
AN ACT
relating to certain practices of debt collectors and credit
bureaus.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 392.202, Finance Code, is amended to
read as follows:
Sec. 392.202. CORRECTION OF THIRD-PARTY DEBT COLLECTOR'S OR
CREDIT BUREAU'S FILES. (a) An individual who disputes the accuracy
of an item that is in a third-party debt collector's or credit
bureau's file on the individual and that relates to a debt being
collected by the third-party debt collector may notify in writing
the third-party debt collector [or credit bureau] of the
inaccuracy. The third-party debt collector [or credit bureau]
shall make a written record of the dispute. If the third-party debt
collector does not report the dispute to a credit bureau, the
third-party debt collector shall cease collection efforts. If the
third-party debt collector reports the dispute to a credit bureau,
the third-party debt collector shall initiate an investigation of
the dispute [provide forms for the notice and, when requested,
assist an individual in preparing the notice].
(b) Not later than the 30th day after the date a notice of
inaccuracy is received, a [the] third-party debt collector who
initiates an investigation [or credit bureau] shall send a written
statement to the individual:
(1) denying the inaccuracy;
(2) admitting the inaccuracy; or
(3) stating that the third-party debt collector [or
credit bureau] has not had sufficient time to complete an
investigation of the inaccuracy.
(c) If the third-party debt collector [or credit bureau]
admits that the item is inaccurate under Subsection (b), the
third-party debt collector [or credit bureau] shall:
(1) not later than the fifth business day after the
date of the admission, correct the item in the relevant file; and
(2) immediately cease collection efforts [on
correction of the item send to each person who has previously
received a report from the third-party debt collector or credit
bureau containing the inaccurate information notice of the
inaccuracy and a copy of an accurate report].
(d) If the third-party debt collector [or credit bureau]
states that there has not been sufficient time to complete an
investigation, the third-party debt collector [or credit bureau]
shall immediately:
(1) change the item in the relevant file as requested
by the individual; and
(2) [send to each person who previously received the
report containing the information a notice that is equivalent to a
notice under Subsection (c) and a copy of the changed report; and
[(3)] cease collection efforts [if the item involves a
debt].
(e) On completion by the third-party debt collector [or
credit bureau] of the investigation, the third-party debt collector
[or credit bureau] shall inform the individual of the determination
of whether the item is accurate or inaccurate. If the third-party
debt collector [or credit bureau] determines that the information
was accurate, the third-party debt collector [or credit bureau] may
again report that information and resume collection efforts.
SECTION 2. Section 392.304(a), Finance Code, is amended to
read as follows:
(a) Except as otherwise provided by this section, in debt
collection or obtaining information concerning a consumer, a debt
collector may not use a fraudulent, deceptive, or misleading
representation that employs the following practices:
(1) using a name other than the:
(A) true business or professional name or the
true personal or legal name of the debt collector while engaged in
debt collection; or
(B) name appearing on the face of the credit card
while engaged in the collection of a credit card debt;
(2) failing to maintain a list of all business or
professional names known to be used or formerly used by persons
collecting consumer debts or attempting to collect consumer debts
for the debt collector;
(3) representing falsely that the debt collector has
information or something of value for the consumer in order to
solicit or discover information about the consumer;
(4) failing to disclose clearly in any communication
with the debtor the name of the person to whom the debt has been
assigned or is owed when making a demand for money;
(5) failing to disclose, except in a formal pleading
made in connection with a legal action:
(A) [clearly in any communication with the
debtor] that the debt collector is attempting to collect a
[consumer] debt and that any information obtained will be used for
that purpose, if the communication is the initial written or oral
communication with the debtor [unless the communication is for the
purpose of discovering the location of the debtor]; or
(B) that the communication is from a debt
collector, if the communication is a subsequent written or oral
communication with the debtor;
(6) using a written communication that fails to
indicate clearly the name of the debt collector and the debt
collector's street address or post office box and telephone number
if the written notice refers to a delinquent consumer debt;
(7) using a written communication that demands a
response to a place other than the debt collector's or creditor's
street address or post office box;
(8) misrepresenting the character, extent, or amount
of a consumer debt, or misrepresenting the consumer debt's status
in a judicial or governmental proceeding;
(9) representing falsely that a debt collector is
vouched for, bonded by, or affiliated with, or is an
instrumentality, agent, or official of, this state or an agency of
federal, state, or local government;
(10) using, distributing, or selling a written
communication that simulates or is represented falsely to be a
document authorized, issued, or approved by a court, an official, a
governmental agency, or any other governmental authority or that
creates a false impression about the communication's source,
authorization, or approval;
(11) using a seal, insignia, or design that simulates
that of a governmental agency;
(12) representing that a consumer debt may be
increased by the addition of attorney's fees, investigation fees,
service fees, or other charges if a written contract or statute does
not authorize the additional fees or charges;
(13) representing that a consumer debt will definitely
be increased by the addition of attorney's fees, investigation
fees, service fees, or other charges if the award of the fees or
charges is subject to judicial discretion;
(14) representing falsely the status or nature of the
services rendered by the debt collector or the debt collector's
business;
(15) using a written communication that violates the
United States postal laws and regulations;
(16) using a communication that purports to be from an
attorney or law firm if it is not;
(17) representing that a consumer debt is being
collected by an attorney if it is not; or
(18) representing that a consumer debt is being
collected by an independent, bona fide organization engaged in the
business of collecting past due accounts when the debt is being
collected by a subterfuge organization under the control and
direction of the person who is owed the debt.
SECTION 3. This Act takes effect September 1, 2003.