BILL ANALYSIS                                                                                                                                                                                                    



                                                          AB 969
                                                          Page  1

Date of Hearing:   May 10, 1999

           ASSEMBLY COMMITTEE ON BANKING AND FINANCE 
                      Louis J. Papan, Chair
           AB 969 (Papan) - As Amended:  April 29, 1999
  
SUBJECT  : Robbins-Rosenthal Fair Debt Collection Practices Act,  
additional provisions.  

  SUMMARY  : Incorporates by reference selected provisions from the  
Federal Debt Collection Act. Specifically,  this bill  :

1)Incorporates by reference provisions of the Federal Debt  
  Collection Act relating to: acquisition of location  
  information; communication in connection with debt collection;  
  harassment or abuse; false or misleading representations;  
  unfair practices; validation of debts; multiple debts; legal  
  actions by debt collectors; and furnishing certain deceptive  
  forms. 

2)Excludes from the requirements, relating to initial  
  disclosures and validation of debts, any officer or employee  
  of a creditor while, in the name of the creditor, collecting  
  debts for such creditor and any person while acting as a debt  
  collector for another person, both of whom are related by  
  common ownership or affiliated by corporate control.

3)For violation of the fair debt collection procedures, subjects  
  debt collectors to the remedies of actual damages and up to  
  $1,000 for an individual and/or for violation affecting a  
  class composed of numerous debtors actual damages and up to  
  $500,000 or 1% of net worth together with costs of suit and  
  attorney's fees to the prevailing plaintiff(s).  

4)Creates a one year statute of limitation commencing on the  
  date of violation.

  EXISTING LAW:  California law has few reasonable remedies for  
aggrieved persons.  Under California law debt collectors can  
avoid liability for egregious conduct, e.g., "a debt collector  
shall have no civil liability under this title if, within 15  
days either after discovering a violation which is able to be  
cured, or after the receipt of a written notice of such  
violation, the debt collector notifies the debtor of the  
violation, and makes whatever adjustments or corrections are  








                                                          AB 969
                                                          Page  2

necessary to cure the violation with respect to the debtor."   
And "a debt collector shall have no civil liability to which  
such debt collector might otherwise be subject for a violation  
of this title, if the debt collector shows by a preponderance of  
evidence that the violation was not intentional and resulted  
notwithstanding the maintenance of procedures reasonably adapted  
to avoid any such violation."  In addition California law does  
not provide for a class action. 

  FISCAL EFFECT  :  Minor

  COMMENTS  : Because of our current law violations are honored more  
in the breach than the observance and there are no meaningful  
incentives for debt collectors to comply.  In addition, as  
demonstrated by a recent pattern of conduct by a major national  
retailer in fraudulently inducing debtors to validate debts  
after bankruptcy, absent the threat of a class action, there is  
no incentive to abort an illegal continuing course of conduct. 


  REGISTERED SUPPORT / OPPOSITION  :   

  Support  

Attorney General
Consumers Union

  Opposition  

None received
  
Analysis Prepared by  : William C. George / B. & F. / (916)  
319-3081