Michigan state debt collection laws
Regulation of collection practices (Act 70 of 1981)
445.252 Prohibited acts.
As per Michigan state debt collection laws, a collector cannot commit any one or more of the following:
- Communicating with a debtor in a misleading or deceptive manner, such as stating himself as a government representative or a member of a certain credit bureau.
- Using such forms or papers that appear to be legal.
- Using seals or printed forms of a government agency or institution.
- Making a misleading, deceptive or untrue statement or claim, or not revealing the purpose of a communication while collecting on a debt.
- Stating that non-repayment of debt will lead to arrest or imprisonment, seizure or garnishment of the debtor’s property, or not stating the legal rights of the debtor.
- Communicating with a debtor without disclosing the caller’s identity or cause expense to a debtor due to a long distance telephone call, telegram, or other reasons.
- Communicating with a debtor, except through billing procedure when the debtor is being represented by an attorney.
- Communicating information regarding a debtor’s indebtedness to an employer or a third party without the debtor’s authorization in writing, unless the communication is for acquiring location information about the debtor.
- Threatening to physical harm while collecting on a debt.
- Publishing or threatening to publish list of debtors, except for credit reporting requirements.
- Undertaking harassing, abusive or oppressive methods to collect on a debt, or calling the debtor at inconvenient times or places. All communications should be strictly made between 8 a.m. to 9 p.m. unless the debtor agrees in writing to receive call at another time.
- Using profane or obscene language.
- Communicating with a debtor regarding debt by post card.
445.253 Cease and desist order; hearing; action in circuit court; fine.
- The state attorney general may order a regulated person to cease and desist from violating this act.
- If a regulated person who is ordered to cease and desist files a written request within 30 days after the effective date of the order, he can be entitled to a hearing before an officer appointed by the attorney general.
- If a regulated person doesn’t comply with the cease and desist order, the attorney general may initiate an action for the violation of the cease and desist order in a circuit court of Ingham county or in a circuit court where the person is doing business. The court may further impose a fine of more than $500.00 for each violation of the cease and desist order.
445.256 Willful violation of act or engaging in recurring course of violation of act; penalties.
- Under this act, if a court finds that a regulated person has willfully violated this act, the attorney general may file a petition in the court and recover on behalf of the state a civil fine not exceeding $500.00 per violation.
- A regulated person engaged in willful violation of this act shall be fined more than $5,000 for the first violation, and more than $10,000 and imprisonment for more than one year for the second or subsequent violation.
445.258 Communications with person other than the debtor to acquire location information.
- A regulated person communicating with any person other than the debtor in order to acquire location information about the debtor must state all the following:
- The name of the person seeking location information.
- If the purpose of the communication is for verification or rectification of the debtor’s location information.
- As per the act, a debtor’s location information shall consist only a debtor’s residence and place of employment’s addresses and telephone number of each place.