Attorney General Chris Koster’s two new regulations aimed at protecting Missouri consumers from abusive debt collectors become effective today.
The first regulation deems it unlawful to file suits on debt that is beyond the statute of limitations, has been discharged in bankruptcy, or has been declared void or unenforceable by a court. The second regulation prohibits debt collectors from tricking a consumer into unwittingly reaffirming an uncollectable debt in those same three categories. Enforcement actions for violating the rules could include criminal lawsuits or civil suits brought by the Attorney General’s Office or private counsel.
“I am hopeful our new regulations will stymie unethical debt collectors from perpetuating their unfair and deceptive business practices,” said Koster, whose office teamed with Missouri’s legal aid organizations when drafting the new rules.
Koster devised the new regulations to combat the dramatic increase in unethical debt-collection litigation in Missouri over the past decade. During that time, the secondary debt-collection industry evolved, which entails companies purchasing charged-off debt deemed uncollectable by a creditor at a steep discount and then attempting to collect that debt through any means possible, including the serial filing of debt-collection lawsuits in state court.
The Attorney General’s unfair practices regulations, including the two new rules, are available at http://s1.sos.mo.gov/cmsimages/adrules/csr/current/15csr/15c60-8.pdf. The two new rules are 15 CSR 60-8.100, titled “Threatening to File or Filing Suit on Certain Consumer Debt,” and 15 CSR 60-8.110, titled “Reaffirmation of Consumer Debt Without Valuable Consideration.”