Business Regulation (GBR) — Title 7. Collection Agencies

collecting a consumer claim the person owns, using a name or other artifice that indicates that another party is attempting to collect the consumer claim;

giving, selling, attempting to give or sell to another, or using, for collection of a consumer claim, a series or system of forms or letters that indicates directly or indirectly that a person other than the owner is asserting the consumer claim; or

employing the services of an individual or business to solicit or sell a collection system to be used for collection of a consumer claim.

is for money owed or said to be owed by a resident of the State; and

arises from a transaction in which, for a family, household, or personal purpose, the resident sought or got credit, money, personal property, real property, or services.

“Control person” means a person who has the power, directly or indirectly, to direct the management or policies of a collection agency, whether through ownership of securities, by contract, or otherwise.

“Control person” includes a person who:

the licensee’s legal name; and

any trade name used by the licensee in accordance with § 2–121 of the Financial Institutions Article.

In this section the following words have the meanings indicated.

“Common ownership” means direct or indirect ownership of more than 50% of a person.

“Principal business” means a business activity of a person that comprises more than 50% of the total business activities of the person.

a bank;

a federal or State credit union;

a mortgage lender;

a person acting under an order of a court of competent jurisdiction;

a licensed real estate broker, or an individual acting on behalf of the real estate broker, in the collection of rent or allied charges for property;

a savings and loan association;

a title company as to its escrow business;

a trust company;

a lawyer who is collecting a debt for a client, unless the lawyer has an employee who:

a person who is collecting a debt for another person if:

the Board under this title; or

the State Division of Consumer Protection or a local consumer protection unit under the Maryland Consumer Debt Collection Act or under local law.

The Board consists of the following 5 members:

Of the 4 appointed members:

Each consumer member of the Board:

A consumer member of the Board may not:

The term of an appointed member is 4 years and begins on July 1.

At the end of a term, an appointed member continues to serve until a successor is appointed and qualifies.

A member who is appointed after a term has begun serves only for the rest of the term and until a successor is appointed and qualifies.

The Governor may remove an appointed member for incompetence or misconduct.

Except as provided in paragraph (3) of this subsection and subject to paragraph (4) of this subsection, a member shall be considered to have resigned who has been appointed to the Board by the Governor if the member did not attend at least two–thirds of the Board meetings held during any consecutive 12–month period while the member was serving on the Board.

The Governor may waive a member’s resignation and allow the member to continue serving if the member has been unable to attend meetings for reasons satisfactory to the Governor and the reasons are made public.

In accordance with § 8–501 of the State Government Article, the chairman shall provide notice to the Governor and the Governor shall appoint a successor.

receive a written complaint and hold a hearing on an alleged violation by a collection agency of the Maryland Consumer Debt Collection Act or this title;

mediate a dispute between a consumer and a collection agency and suggest monetary compensation of the consumer in an amount agreeable to the consumer and collection agency or other appropriate resolution or both; and

issue orders:

the seriousness of the violation;

the good faith of the violator;

the violator’s history of previous violations;

the deleterious effect of the violation on the public and the collection industry; and

any other factors relevant to the determination of the financial penalty.

a regular employee of a creditor while the employee is acting under the general direction and control of the creditor to collect a consumer claim that the creditor owns; or

a regular employee of a licensed collection agency while the employee is acting within the scope of employment.

obtain and maintain a valid unique identifier issued by NMLS when an account is created with NMLS; and

transfer licensing information to NMLS.

The Commissioner shall establish a time period that is not less than 2 months within which a licensee must transfer licensing information to NMLS.

The time period that the Commissioner establishes under this subsection shall begin on or after July 1, 2017.

At least 30 days before the transfer period begins, the Commissioner shall:

on or after July 1, 2017; or

if the Commissioner has not joined NMLS with respect to collection agencies as of July 1, 2017, on or after the date that the Commissioner joins, as specified by the Commissioner by public notice.

submit a completed application in the form, and in accordance with the process, that the Board requires;

pay to the Board:

provide all the information that the Board requests.

the applicant’s legal name, any trade name used by the applicant in accordance with § 2–121 of the Financial Institutions Article, and the applicant’s principal executive office address, telephone number, e–mail address, and Web site addresses, if any;

the address of each additional location, if any, that:

the federal employer identification number or Social Security number of the applicant, as applicable;

the state of formation and the date of formation of the applicant if the applicant is a business entity;

the name and residence address of each control person;

the name and address of the principal contact for consumer complaints;

the name, address, and telephone number of the applicant’s resident agent; and

any other information that the Board requests.

credited to the Non–Depository Special Fund established under § 2–120 of the Financial Institutions Article; and

used in accordance with § 2–120(d) of the Financial Institutions Article.

engage in business as a collection agency;

warrant the belief that the business will be conducted lawfully, honestly, fairly, and efficiently; and

command the confidence of the public.

has committed any act that would be a ground for reprimand, suspension, or revocation of a license under this subtitle; or

otherwise fails to meet the requirements for licensure.

deny the application; and

immediately notify the applicant of the denial.

The denial of an application under this section is subject to the hearing provisions of § 7–309 of this subtitle.

An applicant who seeks a hearing on a license application denial shall file a written request for a hearing within 45 days following receipt of the notice to the applicant of the applicant’s right to a hearing.

the State; and

any member of the public who has a loss or other damage as a result of a violation of this title or the Maryland Consumer Debt Collection Act by the applicant or an agent or employee of the applicant.

in the amount determined by the Board under subsection (j) of this section;

issued by a surety company that:

conditioned that the licensee shall comply with the Maryland Consumer Debt Collection Act and any other laws applicable to consumer debt collection.

shall be continuous;

may not be aggregated or cumulative, whether or not the bond is renewed, continued, replaced, or modified;

may not be determined by adding together the penal sum of the bond, or any part of the penal sum of the bond, in existence at any two or more points in time;

shall be considered to be one continuous obligation, regardless of increases or decreases in the penal sum of the bond;

may not be affected by:

may not require an administrative enforcement action by the Board as a prerequisite to liability; and

shall continue for 3 years after the later of the date on which:

A bond may be canceled by the surety or the licensee by giving notice of cancellation to the Board.

Notice under paragraph (1) of this subsection shall:

A cancellation of a bond under this subsection is not effective until 90 days after receipt of a notice of cancellation by the Board.

a claimant; or

the Board for the benefit of a claimant or the State.

shall pay the amount of the bond to the Board for pro rata distribution to claimants; and

is relieved of liability under the bond.

The amount of the surety bond required under subsection (c) of this section shall be in an amount of not less than $50,000 and not more than $1,000,000, as determined by the Board for each licensee.

In setting the amount of the surety bond, the Board may consider:

the licensee’s legal name and any trade name used by the licensee in accordance with § 2–121 of the Financial Institutions Article;

the address of the licensee’s principal executive office; and

the address of each additional location, if any, where the licensee does business and that:

the licensee provides to the Board, through NMLS and in accordance with any applicable regulations, notice of the addition, deletion, or modification;

the addition, deletion, or modification of the location is recorded with the information associated with the licensee’s license in NMLS; and

the addition, deletion, or modification of the location otherwise complies with this title.

begin on the date the license is issued; and

expire on December 31 of the year:

is otherwise entitled to be licensed;

pays to the Board a nonrefundable renewal fee set by the Board;

submits a renewal application in the form and in accordance with the process that the Board requires; and

files as part of the application a surety bond as required under § 7–304 of this subtitle.

the licensee’s unique identifier; and

a statement advising consumers of the availability of the NMLS Consumer Access website to verify the licensing status of the licensee.

the licensee’s unique identifier; and

a link to the NMLS Consumer Access website.

The requirements under any federal law and Title 4, Subtitles 1 through 5 of the General Provisions Article regarding the privacy or confidentiality of information or material provided to NMLS, and any privilege arising under federal or state law, including the rules of any federal or state court with respect to that information or material, shall continue to apply to that information or material after the information or material has been disclosed to NMLS.

The information and material may be shared with all state and federal regulatory officials having authority over the debt collection industry, including the Financial Crimes Enforcement Network and the Office of Foreign Assets Control, and any successor to these agencies, without the loss of privilege or the loss of confidentiality protections provided by federal law or Title 4, Subtitles 1 through 5 of the General Provisions Article.

enter into information sharing agreements with any federal or state regulatory agency having authority over collection agencies or with any federal or state law enforcement agency, including the Financial Crimes Enforcement Network and the Office of Foreign Assets Control, and any successor to these agencies, provided that the agreements prohibit the agencies from disclosing any shared information without the prior written consent from the Board regarding disclosure of the particular information; and

exchange information about collection agencies with any federal or state regulatory agency having authority over collection agencies or with any federal or state law enforcement agency.

disclosure under any federal or state law governing the disclosure to the public of information held by an officer or agency of the federal government or a state that has received the information or material; or

subpoena, discovery, or admission into evidence, in any private civil litigation or administrative process, unless, with respect to any privilege held by NMLS, the person to whom the information or material pertains waives, in whole or in part, that privilege.

makes any material misstatement in an application for a license;

is convicted under the laws of the United States or of any state of:

in connection with the collection of any consumer claim:

knowingly or negligently violates the Maryland Consumer Debt Collection Act; or

fails to comply with a lawful order that the Board passes under this title.

the nature of the crime;

the relationship of the crime to the activities authorized by the license;

with respect to a felony, the relevance of the conviction to the fitness and qualification of the licensee to engage in the collection agency business;

the length of time since the conviction; and

the behavior and activities of the licensee since the conviction.

Except as otherwise provided in § 10-226 of the State Government Article, before the Board takes any final action under § 7-308 of this subtitle, or under § 7-205 of this title, it shall give the person against whom the action is contemplated an opportunity for a hearing before the Board.

A hearing shall be held at a time and place reasonably convenient to the parties.

where the licensee which is the subject of the order has its principal place of business; or

if the licensee has no principal place of business in the State, where the consumer aggrieved by the violation resides.