ARTICLE 16

                                       COLLECTION AGENCIES

§ 47-16-1.  Citation of article.

This article may be cited as the “Collection Agency Act of 1973.”

§ 47-16-2.  Definitions.

The following words and terms as used in this article shall be construed as follows:

(a)  “Claim” means any obligation for the payment of money due or asserted to be due to another person, firm,
corporation or association.

(b)  “Collection agency” means and includes all persons, firms, corporations and associations (1) directly or
indirectly engaged in the business of soliciting from or collecting for others any account, bill or indebtedness
originally due or asserted to be owed or due another and all persons, firms, corporations and associations directly
or indirectly engaged in asserting, enforcing or prosecuting those claims; (2) which, in attempting to collect or in
collecting his or her own accounts or claims uses a fictitious name or names other than his or her own name;  (3)
which attempts to or does give away or sell to others any system or series of letters or forms for use in the collection
of accounts or claims which assert or indicate directly or indirectly that the claims or accounts are being asserted
or collected by any person, firm, corporation or association other than the creditor or owner of the claim or account;
or (4) directly or indirectly engaged in the business of soliciting, or who holds himself or herself out as engaged in
the business of soliciting, debts of any kind owed or due, or asserted to be owed or due, to any solicited person,
firm, corporation or association for fee, commission or other compensation.

The term “collection agency” shall not mean or include (1) regular employees of a single creditor or of a
collection agency licensed hereunder; (2) banks; (3) trust companies; (4) savings and loan associations; (5)
building and loan associations; (6) industrial loan companies; (7) small loan companies; (8) abstract companies
doing an escrow business;  (9) duly licensed real estate brokers or agents when the claims or accounts being
handled by such broker or agent are related to or in connection with such brokers’ or agents’ regular real estate
business;  (10) express and telegraph companies subject to public regulation and supervision;  (11) attorneys-at-
law handling claims and collections in their own names and not operating a collection agency under the
management of a layman; (12) any person, firm, corporation or association acting under the order of any court of
competent jurisdiction; or (13) any person collecting a debt owed to another person only where:  (a) both persons
are related by wholly-owned , common ownership or affiliated by wholly-owned corporate control; (b) the person
collecting the debt acts only on behalf of persons related as described in paragraph (a) of this subdivision; and (c)
debt collection is not the principal business of the person collecting the debt.

(c)     “Commissioner” means the state tax commissioner or his or her agent.

(d)  “Customer” means any person, firm, corporation or association who has filed, assigned or sold any claim
or chose in action with or to a collection agency for collection.

(e)      “Licensee” means any person holding a business franchise registration certificate under section two,
article twelve, chapter eleven of this Code and under the provisions of this article.

(f)  “Trust account” means a special account established by a collection agency with a banking institution
in this State, wherein funds collected on behalf of a customer shall be deposited.

§ 47-16-3.  Scope of article.

No person, firm, corporation or association shall establish or conduct within this State a collection agency
except as authorized by this article.

§ 47-16-4.  Requirements for conduct of agency.

(a)  License -- No person, firm, corporation or association shall conduct within this State a collection agency
without having first applied for and obtained a business franchise registration certificate pursuant to
section two [§ 11-12-2], article twelve, chapter eleven of this Code, nor shall any person, firm, corporation or
association establish or operate a collection agency or the business of a collection agency, unless such person,

firm, corporation or association maintains an office within the State of West Virginia.  The business franchise
registration certificate shall be deemed the collection agency’s license.  A license is required for each collection
agency, including each principal office and all branch offices thereof.

(b) Bond -- Each applicant shall file with the Commissioner a continuing surety bond executed by a corporation
which is licensed to transact the business of fidelity and surety insurance in the State of West Virginia to run
concurrently with the registration tax period, which bond must be filed with, and approved by, said Commissioner
before the license herein provided may be issued.  A separate bond shall be filed for each collection agency including
each principal office and all branch offices thereof.  Each bond shall be in the amount of five thousand dollars payable
to the State of West Virginia, and conditioned that any such person will pay all damages to the State or a private
person resulting from any unlawful act or action by such person or his or its agent in connection with the conduct
of the business of the collection agency.  This continuing bond shall be filed with the Tax Commissioner.

An action may be brought in any court of competent jurisdiction upon the bond by any person to whom the
licensee fails to account and pay as set forth in such bond. The aggregate liability of the surety for all breaches of
the condition of the bond shall not exceed the sum of such bond.

Upon entering judgment for the prevailing party on any action on the bond required by this article, the court shall
include in the judgment, reasonable compensation for the services of such party’s attorney in the action.

The license of any licensee shall be void upon termination of the bond of the surety company, unless, prior to
such termination, a new bond has been filed with the Commissioner.

Should the license of any surety company to transact business in this State be terminated, all bonds given
pursuant to this article upon which such company is surety shall thereupon be suspended, and the Commissioner
shall immediately notify each affected licensee of such suspension and require that a new bond be filed.  This notice
shall be by registered or certified mail, return receipt requested, and shall be addressed to the licensee at his or
its principal place of business as shown by the Commissioner’s records.  The failure of any licensee to file a bond
with new or additional surety within thirty days after being advised in writing by the Commissioner of the necessity
to do so shall be cause for the Commissioner to revoke the license.

(c) Record keeping -- Each collection agency licensed to operate in this State shall keep a record of all sums
collected by such agency and of all disbursements made by such agency, and shall maintain or make available
all such records and all records as to customers’ funds at such agency’s principal place of business within this
State.  Each collection agency shall maintain records of collections for and payments to customers for a period
of six years from the date of last entry therein.

No collection agency, nor any employee thereof, shall intentionally make a false entry in any such collection
agency record nor intentionally mutilate, destroy or otherwise dispose of any such record within the time limits
provided in this section. Such records shall at all times be open for inspection by the Commissioner, or his duly
appointed representative.

No licensee shall commingle the money of collection agency customers with other moneys, but shall maintain
a separate trust account in a bank for customers’ funds.

Each collection agency shall, within a period of thirty days after the close of each and every calendar month,
pay to such agency’s customers the net proceeds due on all collections made during the preceding calendar month.
When the net proceeds due the customer are less than five dollars at the end of any calendar month, the collection
agency may defer for a period not to exceed ninety days the payment or said proceeds, if monthly statements are
mailed or delivered to the customer.

§ 47-16-5.  Penalty; civil liability.

(a)  Any person, firm, corporation or association violating any of the provisions of this article shall be guilty of
a misdemeanor, and, upon conviction thereof, shall be fined not more than one thousand dollars.

(b)  Any person, firm, corporation or association violating any of the provisions of this article shall, in addition
to any civil liability arising by virtue of such violation, also be civilly liable as otherwise provided by law.