Revised debt collection regulations designed to provide stronger consumer protections by addressing changing technology go into effect Friday, Massachusetts Attorney General Martha Coakley announced. The regulations, which were the subject of public hearings last spring, guide the ARM  industry in its collection practices and are more consistent with existing state and federal laws, according to the AG’s office.

“Given the industry’s recent advances in technology, we concentrated on how we could bring our regulations up-to-date and streamline them to be consistent with other state and federal agencies,” AG Coakley said. “These amendments ensure that the playing field is level for both creditors and consumers so that all parties are better protected.”

The amended regulations include:

    • A definition of “creditor” that includes a buyer of delinquent debt who hires a third party to collect, also known as a “passive debt buyer”;
    • An amended definition of “debt” that now includes a first mortgage or a loan in excess of $25,000, when previously it did not;
    • An amended definition of “communication” so that abusive dialogue by phone recordings and text messages are prohibited;
    • Amended sections to reflect technological advances such as cell phones and text messaging and other data usage fees.
    • The incorporation of prohibited practices from the Division of Banks in order to ensure a consistent regulatory approach at the state and federal level;
    • A change making it unfair to take possession or sell property that is exempt from seizure because its value does not exceed the exemption set forth by statute;
    • A provision requiring that any person collecting debt must determine in good faith whether the debt is time-barred, meaning they are no longer collectible through court action, and if so make a specific disclosure to consumers.

The amended regulations are part of AG Coakley’s decision to review and streamline all regulations issued pursuant to the Consumer Protection Act. The goal of this initiative is to promote a more favorable regulatory environment that improves the business climate in the Commonwealth while maintaining and promoting principles of consumer protection and fair business practices.

Copies of the revised regulations are available on the Attorney General’s website at

AG Coakley’s Office originally filed proposed amended regulations with the Secretary of State’s Office in March 2011, followed by a public hearing on May 18, 2011 in Boston. The proposed amended regulations were further revised after receiving comments from the Boston Bar Association, the Association of Credit and Collection Professionals, consumer advocates, the Office of Consumer Affairs and Business Regulation, and others.

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