Debt Collector Legal Registration Requirement

Did you know that a debt collector must register with your local State Department of Business Regulation in order to report, confirm, verify or try to collect an alleged debt?  Do you know why debt collector legal registration may be of critical importance to you?  Let me tell you a story.

Back story of a Debt Illegally reported

The employer was very upset about a dental bill that had been reported to all 3 credit bureaus by his personal dentist.  A former employee of the employer had run up a $1500.00 dental bill without the employer’s knowledge.  The dentist when confronted said that the former employee said the employer would pay.  The dentist performed the services without checking with the employer.  When the employer protested the dentist claimed that since the services had been rendered they had to be paid for.  No legal action in the form of a small claims or other lawsuit was filed by the dentist.  The dentist hired a debt collection company called “Txxxxx Professional Services” out of California to collect.  The alleged debt was reported to Trans Union, Equifax and Experian.  Objections were filed with the 3 credit reporting agencies on the employer’s behalf but the debt was ruled valid.   A request for further investigation was denied.   A prime example of the presumption of guilt by the credit reporting agencies against consumers.  End of story?  Only if the victim quits and gives up.

Is Debt Collector’s Corporate Status in Legal Order?

Debt collectors operate out of legal entities such as Corporations and Limited Liability Companies.  Each Secretary of State requires annual reports accompanied by a fee or the corporate/legal status will be revoked.  Walk into your Secretary of State’s office give the clerk the name of the debt collector and ask for a print out.  If the corporation of the debt collector is up to date don’t give up.  If the legal status isn’t current get a print out or letter showing this.  Forward it to the credit reporting agency with your demand for deletion.  The debt collector has no legal standing to report or verify so the debt must be deleted.  If the corporate/legal status is in order there is one more little known Ninja trick.

Is Debt Collector Legal Registration Current with State Department of Business Regulation?

Your State’s Department of Business Regulation is a separate legal entity.  You can try calling and/or checking on the internet.  The direct approach works best.   Walk into their office and ask if the debt collector legal registration is current in renewing their registration with them.  In the case I am referring to above it turned out that the debt collector legal registration in the home state of the alleged debtor had expired 3 years earlier.  This was despite the fact that the debt collector’s corporate status was up to date!  Txxxxx Professional Services had no debt collector legal registration standing to verify the debt.  The debt had to be deleted by the credit reporting agencies.