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Agency collecting credit card debt not a creditor, COA rules

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A debtor’s counterclaim that a collection agency violated the Indiana Uniform Consumer Credit Code by not obtaining a license was rejected by the Indiana Court of Appeals on the grounds that although the agency was trying to recover a debt, it was not a creditor.

Asset Acceptance LLC, a Delaware limited liability company with its principal place of business in Michigan, tried to recover $6,594.26 from Nathan Wertz, who had defaulted on his credit card from Chase Bank/First USA/Chase.

Wertz claimed Asset Acceptance could not collect on payments for consumer loans debts because it is not licensed under the IUCCC. Accordingly, Wertz argued Asset Acceptance’s collection efforts violated both the Indiana Deceptive Consumer Sales Act and the federal Fair Debt Collection Practices Act.

The Indiana Court of Appeals disagreed in Nathan Wertz v. Asset Acceptance, LLC, 71A03-1305-CC-175. The COA affirmed the trial court’s grant of the agency’s Trial Rule 12(B)(6) motion to dismiss Wertz’s counterclaim.

Wertz raised the question on appeal of whether Asset Acceptance “regularly engage(d) in Indiana” in taking assignments of consumer loans or in the collection of payments from debtors arising from consumer loans as described in Indiana Code 24-4.5-3-502. If so, then it was required to have a license from the IUCCC.

Citing Sheetz v. PYOD LLC, 3:12-cv-811-JD-CAN, 2013 WL 5436943 (N.D. Ind. Sept. 26, 2013), the Court of Appeals rejected the argument that the plain language of the IUCCC extends the licensure requirement to entities not physically located in Indiana.

“…Section 3-502(3), which is the licensure requirement relevant here, does not require ‘creditors’ to obtain a license and instead focuses on the actions undertaken by the entity in question,” Judge Edward Najam wrote for the court. “These actions, in particular that of taking an assignment or collecting on a debt, may or may not be the actions of a creditor.”

 

 

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  1. From his recent appearance on WRTV to this story here, Frank is everywhere. Couldn't happen to a nicer guy, although he should stop using Eric Schnauffer for his 7th Circuit briefs. They're not THAT hard.

  2. They learn our language prior to coming here. My grandparents who came over on the boat, had to learn English and become familiarize with Americas customs and culture. They are in our land now, speak ENGLISH!!

  3. @ Rebecca D Fell, I am very sorry for your loss. I think it gives the family solace and a bit of closure to go to a road side memorial. Those that oppose them probably did not experience the loss of a child or a loved one.

  4. If it were your child that died maybe you'd be more understanding. Most of us don't have graves to visit. My son was killed on a state road and I will be putting up a memorial where he died. It gives us a sense of peace to be at the location he took his last breath. Some people should be more understanding of that.

  5. Can we please take notice of the connection between the declining state of families across the United States and the RISE OF CPS INVOLVEMENT??? They call themselves "advocates" for "children's rights", however, statistics show those children whom are taken from, even NEGLIGENT homes are LESS likely to become successful, independent adults!!! Not to mention the undeniable lack of respect and lack of responsibility of the children being raised today vs the way we were raised 20 years ago, when families still existed. I was born in 1981 and I didn't even ever hear the term "CPS", in fact, I didn't even know they existed until about ten years ago... Now our children have disagreements between friends and they actually THREATEN EACH OTHER WITH, "I'll call CPS" or "I'll have [my parent] (usually singular) call CPS"!!!! And the truth is, no parent is perfect and we all have flaws and make mistakes, but it is RIGHTFULLY OURS - BY THE CONSTITUTION OF THIS GREAT NATION - to be imperfect. Let's take a good look at what kind of parenting those that are stealing our children are doing, what kind of adults are they producing? WHAT ACTUALLY HAPPENS TO THE CHILDREN THAT HAVE BEEN RIPPED FROM THEIR FAMILY AND THAT CHILD'S SUCCESS - or otherwise - AS AN ADULT.....

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