West Virginia Gov. Earl Ray Tomblin signed SB 542 into law on Tuesday, clarifying provisions of the West Virginia Consumer Credit and Protection Act.
State lawmakers pushed for the bill to help bring West Virginia law into closer agreement with the Fair Debt Collection Practices Act. The law will go into effect on Sept. 1. State lawmakers passed the measure in March by a 61-34 vote, which fell largely along party lines. Republicans generally supported the reform effort; Democrats opposed.
Some highlights of the legislation include:
Clarifies that a collector may not engage a person in a telephone conversation without disclosure of the callers identity and with the intent to annoy, harass or threaten any person at the called number. Previously, the requirement applied to the placement of telephone calls, which had the unwanted effect of including unanswered calls.
- Adds a provision to ensure a debt collector is properly notified that a consumer is represented by an attorney before any communication with a consumer is a violation. Under the provision, any communication with a consumer made more than 72 hours after the collector receives written notice, either on paper or electronically, from the consumer or his or her attorney that the consumer is represented by an attorney specifically with regard to the subject debt.
The push to update the legislation was supported by financial services representatives, including the Community Banks of West Virginia. It doubles the amount creditors can charge consumers on a delinquent account and details the number of collection calls and contacts allowed per week.
Debt collectors in West Virginia will get no more than 30 calls to a person in a week and 10 telephone conversations per week and the law removes "repeatedly or continuously" from present law. A late amendment offered by House Democrats would have reduced those allowances to five calls per week and two conversations, but that was withdrawn a day before lawmakers voted last month.
The law also changes the definition of a communication in some places by replacing "The placement of telephone calls" with "Engaging any person in telephone conversation." It further allows creditors to charge consumers a $30 late fee for delinquencies on an account, double from the previous $15.
A copy of the legislation can be found here.
Other highlights include:
Clarifies that a consumer may only recover up to $1,000 in additional damages per violation, not to exceed either $175,000 or the total alleged outstanding indebtedness. This limitations period applies to all actions filed on or after Sept. 1.
Eliminates venue shopping by requiring any civil action or other proceeding brought by a consumer to recover actual damages or a penalty, be brought either in the circuit court of the county in which the plaintiff has his or her legal residence at the time of the civil action, the circuit court of the county in which the plaintiff last resided in the state of West Virginia, or in the circuit court of the county in which the creditor or debt collector has its principal place of business or, if the creditor or collector is an individual, in the circuit court of the county of his or her legal residence.
- Establishes that no action can be brought more than four years after the violation occurred (instead of the current limit of one year after the due date of the last scheduled payment of the agreement pursuant to which the charge was paid), applicable to actions filed on or after Sept. 1.