Rhode Island’s Registration Requirements In Force

July 1, 2008, marks the effective date of the state law requiring collection agencies to be registered.

Last year, Rhode Island passed S.B. 34, which requires the registration of a debt collection agency that engages in debt collection activities or solicitations and/or advertisements for the right to collect within the state. The deadline for compliance has been reached, as this requirement became effective today, July 1, 2008.

Registration is required if a debt collection agency does any of the following within the state of Rhode Island:

1. Engages in the business of debt collection.
2. Engages in soliciting the right to collect or received payment for another of a debt.
3. Advertises for or solicits in print the right to collect or received payment for another of a debt within the state.

An out-of-state debt collection agency may be exempt from the registration requirements if it only attempts collections through interstate communication methods on behalf of an out-of state creditor on a debt that was incurred out-of-state. The law does not mandate an exempt out-of-state debt collection agency to file for an exemption with the Rhode Island Department of Business Regulation. However, a debt collection agency may wish to provide the department with details surrounding the exemption and request written confirmation from the department of the agency's exempt status. Such documentation could be of assistance should future liability for failure to register arise.

Applications for registration should be directed to the Rhode Island Department of Business Regulation. The cost of registration is $200, and the registration is effective for three years. A debt collection agency may also complete its registration online for $210. At this time, the registration should be for a single location, but with notification to the director, such registration may be moved to a different location. Failure to follow the newly established registration requirements may result in penalties of not more than $2,000, or imprisonment for not more than one year, or both.

The application for registration is available on the Rhode Island's Department of Business Regulation's Web site. This article is provided as a service of ACA International's Legal and Government Affairs Department.