Collection Agencies

TRADE PRACTICES DIVISION
DEPARTMENT OF GOVERNMENT SERVICES
5 MEWS PLACE
PO BOX 8700
ST. JOHN'S NL  A1B 4J6
CANADA

Other Locations and Contact Numbers

Contents

1. What is a Collection Agency
2. How to become registered as a Collection Agency
3. What a Collection Agency should know
4. What a Debtor should know
5. Collection Links
6. Collection Agency Forms, Pamphlets and Information

What is a Collection Agency

A Collection Agency means a person who:

• collects, offers or undertakes to collect debts for others;
• solicits accounts for collection;
• collects debts owed to him or her under a name which is different from the name of the creditor;
• mails to debtors or offers or undertakes to mail to debtors, on behalf of a creditor, collection letters;
• for consideration or hope or promise of consideration, enters into an agreement under the terms of which the person agrees to pay to a vendor an amount in respect of goods or services sold or supplied by the vendor to a person other than the collection agency;
• offers or undertakes to act for a debtor in arrangements or negotiations with the debtors creditors;
• receives money periodically from a debtor for distribution to his or her creditors;
• sells or offers for sale a collection system, device or scheme intended to be used to collect debts;
• acts as an Independent Court Agent.

How to become registered as a Collection Agency

Before operating in Newfoundland and Labrador a business entity wishing to provide the services of a Collection Agency, where applicable must comply with the following:

• complete a Collection Agency Application (PDF: 88 KB) and submit a registration fee of $300. Cheques are to be made payable to the Newfoundland Exchequer Account;
• if the business entity is a corporation, be in good standing as a company. If the corporation is outside Newfoundland and Labrador then they must be registered as an extra provincial corporation in this province. Please refer to the Registry of Companies for more information;
• have a permanent place of business in the province which is:
  • open during normal business hours;
  • available for debtors to make payments, file complaints and conduct inquiries on their accounts;
  • has a toll free telephone service.
• provide a Surety Bond (PDF: 30 KB) in the amount of $20,000;
• maintain a separate trust account in a financial institution in which the agency shall deposit all monies paid to it in trust for others;
• submit with the application, all forms of agreement, letters, instruments and documents which will be used in the collection of debts for approval with the application;
• submit a certified copy of the most recent balance sheet and auditor’s report of the business entity.

What a Collection Agency should know

Registration remains in effect subject to the filing of an annual report and the payment of an annual $300 fee or until cancelled by the licencee or suspended or cancelled under the Act. The filing is due every 12 months from the effective date of the original licence. The annual filing form will be sent to your mailing address 60 days prior to the filing due date.

A Collection Agency shall not:

• collect or attempt to collect money in addition to the amount owing by the debtor;
• make charges against a person for whom the collection agency acts in addition to those contained in the agreement with that person;
• send correspondence or make telephone calls, where the charges are payable by the debtor;
• deal with a debtor in a name other than that authorized by the registration;
• use a form or form of letter to collect or attempt to collect money from a debtor unless a copy of the form or form of letter is filed with the registrar;
• use, without lawful authority, a summons, notice, or demand or other document, expressed in language of the general style or purport of a form used in a court of the province, or printed or written or in the general appearance or format of that form;
• raise an action in its own name for recovering a debt on behalf of a client;
• where the debtor is an employee, contact the debtor by telephone, mail or in person at the debtor’s place of employment;
• contact the employer of the debtor without the debtor’s consent;
• contact the debtor between the hours of 10 p.m. and 8 a.m.;
• threaten to proceed with an action for which he or she does not have the authority;
• use coercive language, threaten loss of employment or loss of community ranking;
• communicate in any matter with a debtor unless he or she has previously sent him or her a written notice;
• make telephone calls or personal calls or written communications of a nature or frequency as to constitute harassment of the debtor, his or her spouse or a member of his or her family;
• except to obtain the debtor’s address, communicate with acquaintances, friends, relatives or neighbours of the debtor, unless that person is surety for the debtor.

A Collection Agency, collector, person or firm acting on behalf of a collection agency when contacting a debtor by telephone shall immediately upon contacting the debtor identify itself as a collection agency and shall in no way use a device, comment or statement to infer otherwise.

What a Debtor should know

If you are dealing with a Collection Agency regarding an outstanding debt and you feel the agency and/or its' collector is violating the Collections Act or Regulations you should contact the supervisor/manager of the agency in question and express your concerns about the way you are being treated. In the event that the matter cannot be resolved between you and the collection agency, we suggest you file a complaint with us. The complaint has to be registered by the person owing the debt. We cannot mediate third party complaints or legal cases where the complaint is in the process of court action. To register a complaint on line, please complete our Online Collection Agency Complaints Form or to mail or fax your complaint, please download the Complaint Record Form (PDF: 92 KB).

We do not advise consumers or offer counselling on financial issues. For information pertaining to credit counselling you may refer to the yellow pages of the telephone directory

Collection Agency Links

Collection Agency Forms, Pamphlets and Information

• Collection Agencies – Consumer Rights Pamphlet (PDF: 62 KB)
• Collections Act
• Collections Regulations
• Collection Agency Application (PDF: 88 KB)
• Collection Agency Licencing Procedure (PDF: 72 KB)
• Sample Surety Bond (PDF: 30 KB)
• Complaint Record Form (PDF: 92 KB)
• Frequently Asked Questions

If you still haven’t found the information you are looking for, please Contact our office.