Licensing Requirements For Collecting On Debts Purchased In The Commonwealth - Q1 1999By the Division of Banks
An out of state corporation that purchases charged-off portfolios from a nationwide lender inquires as to whether it can collect, without obtaining a collection agency license, on accounts it has purchased in Massachusetts. Mass. Gen. Laws chapter 93, section 24 requires entities engaged in the Commonwealth in the collection of debt for others to obtain a license from the Division as a collection agency. It is the position of the Division that a collection agency license is not required where the corporation will purchase the loans and attempt collection of the loans on its own behalf, not on behalf of any other entity. The corporation is expected to comply with the Commonwealth's Attorney General's debt collection regulations at 940 CMR 7.00 et seq.