In a notable development for debt collection in Wisconsin, the Great Lakes Credit & Collection Association (GLCCA) has played a pivotal role in securing updates to the state’s debt collection statutes after several years of collaboration with the Wisconsin Department of Financial Institutions (WDFI). The result of this collaborative effort is Wisconsin Act 267, formerly Senate Bill 668, signed into law by Wisconsin Governor Tony Evers on April 4, with an effective date of January 1, 2025. Initiated by the WDFI in 2019, the legislation aims to modernize Wisconsin’s debt collection practices, introducing several key changes to the existing framework. These changes involve several areas:
- NMLS licensing and place of business
- Clear definition of “Consumer Loan”
- Check seller and money transmitters
NMLS licensing and place of business
One of the primary updates mandated by the new law is the requirement for collection agencies to maintain their license on the National Multistate Licensing System (NMLS). This ensures greater transparency and accountability within the industry, aligning Wisconsin’s practices with evolving regulatory standards. Additionally, licensed financial services providers are now obligated to keep all material information up to date and accurate with both the WDFI and the NMLS, emphasizing the importance of compliance and regulatory oversight in debt collection activities.
Regarding the regulation of collection agencies, Wisconsin Act 267 introduces noteworthy amendments, including the elimination of the requirement for collectors or solicitors to hold a separate license. Instead, the law specifies that each place of business maintained by a collection agency must possess a separate collection agency license, streamlining licensing procedures.
Clear definition of “Consumer Loan”
Furthermore, the legislation brings about changes in the regulation of consumer lenders, establishing a clear definition of “consumer loan” more in line with that used under the Wisconsin Consumer Act. Activities requiring licensure as a lender are also outlined, ensuring clarity and consistency in regulatory requirements.
Check Seller and Money Transmitters
In the area of check sellers and money transmitters, Wisconsin Act 267 updates certain parts of the previous law with new provisions known as the Model Money Transmission Modernization Law. This update is meant to adapt to changing financial practices and make transactions easier, all while maintaining regulatory standards. Throughout the legislative process, the GLCCA Wisconsin Legislative Committee actively engaged with the WDFI, submitting detailed feedback and concerns. This collaborative approach demonstrates the positive relationship between industry stakeholders and regulators, fostering an environment where meaningful reforms can take place.
In Conclusion
As Wisconsin prepares for the implementation of these updated debt collection laws, stakeholders must stay informed about the changes and ensure compliance with the revised regulatory framework. The journey towards modernization promises enhanced efficiency, transparency, and consumer protection in debt collection practices statewide.
Author: Jennifer Evancic
Jennifer.Evancic@ResourceManagement.com
Jennifer Evancic is a third-party auditor valued by creditors and large organizations for her knowledge in call monitoring within the collections industry. With meticulous attention to detail and a firm grasp of regulatory requirements, she ensures compliance with clients’ criteria and state and federal regulations.
Jennifer audits collections calls, ensuring they meet client-specific criteria and comply with regulations, providing valuable insights and maintaining industry standards.
Beyond her auditing responsibilities, Jennifer takes the lead in organizing and facilitating monthly call calibrations. These sessions serve as a collaborative forum where clients and their vendors come together to discuss call monitoring results and address any findings or areas for improvement. Jennifer’s guidance fosters open communication and ensures alignment between clients and vendors, driving continuous improvement in collections practices.
Jennifer stays up-to-date with compliance and industry best practices by participating regularly in peer meetings, regulatory updates and industry webinars. This keeps her informed about emerging issues and ensures she remains a knowledgeable leader in collections compliance.
Sign Up for the Twice Monthly Newsletter
Just enter your email address at the top orange bar at:
Collection Compliance Experts – “The Power of Expertise: Oversight Perfected”
It’s that easy! Twice a month – we provide blog updates and Resources for the Collection and Industry Professional.
Your email is just for this newsletter. We never sell your information. No fee. Opt-out at any time.
