CA DFPI Proposes Debt Collector Licensing Annual Fee, Annual Reporting Regs

The California Department of Financial Protection and Innovation (DFPI) has issued proposed regulations under the Debt Collection Licensing Act (DCLA) regarding the annual fee calculation and annual reporting requirements for licensees.  The DCLA requires licensing of certain consumer debt collectors.  WBK previously covered the DCLA requirement for debt collection licensing.

Under the DCLA, licensees must pay an annual fee and submit an annual report.  The first annual fee will be collected in 2024.  The annual fee or pro rata share of costs and expenses for debt collection licensees is calculated, under the statute, based on the “proportion of net proceeds generated by California debtor accounts in the preceding year.”  The proposed regulations define “net proceeds generated by California debtor accounts,” further detailing the calculation that each type of debt collector (debt buyer, debt purchaser, first-party collector, and third-party collector) would use to determine this amount, which is reported in the annual report. 

The proposed regulations also clarify the California debtor and debt information required in a licensee’s annual report; for example, describing how to count total California debtor accounts, and requiring that the annual report include the number of California debtor accounts, number of California debtors, and the number of accounts and dollar amounts of the same accounts for which collection was attempted but not collected or resolved.

Comments on the proposed regulations are due March 27, 2024.