§ 7311. Unlawful collection agency practices.
(a) Assignments of claims.--It is lawful for a collection agency, for the purpose of collecting or enforcing the payment thereof, to take an assignment of any such claim from a creditor, if all of the following apply:
(1) The assignment between the creditors and collection agency is in writing.
(2) The original agreement between the creditor and debtor does not prohibit assignments.
(3) The collection agency complies with the act of December 17, 1968 (P.L.1224, No.387), known as the Unfair Trade Practices and Consumer Protection Law, and with the regulations promulgated under that act.
(b) Appearance for creditor.--It is unlawful for a collection agency to appear for or represent a creditor in any manner whatsoever, but a collection agency, pursuant to subsection (a), may bring legal action on claims assigned to it and not be in violation of subsection (c) if the agency appears by an attorney.
(b.1) Unfair or deceptive collection methods.--It is unlawful for a collector to collect any amount, including any interest, fee, charge or expense incidental to the principal obligation, unless such amount is expressly provided in the agreement creating the debt or is permitted by law.
(c) Furnishing legal services.--It is unlawful for a collection agency to furnish, or offer to furnish legal services, directly or indirectly, or to offer to render or furnish such services within or without this Commonwealth. The forwarding of a claim by a collection agency to an attorney at law, for the purpose of collection, shall not constitute furnishing legal service for the purposes of this subsection.
(d) Services for debtor.--It is unlawful for a collection agency to act for, represent or undertake to render services for any debtor with regard to the proposed settlement or adjustment of the affairs of such debtor, whether such compromise, settlement, or adjustment be made through legal proceedings or otherwise, or to demand, ask for, or receive any compensation for services in connection with the settlement or collection of any claim except from the creditor for whom it has rendered lawful services.
(e) Running for attorneys.--It is unlawful for a collection agency to solicit employment for any attorney at law, whether practicing in this Commonwealth or elsewhere, or to receive from or divide with any such attorney at law any portion of any fee received by such attorney at law. This subsection does not prohibit the established custom of sharing commissions at a commonly accepted rate upon collection of claims between a collection agency and an attorney at law.
(f) Coercion or intimidation.--
(1) It is unlawful for a collection agency to coerce or intimidate any debtor by delivering or mailing any paper or document simulating, or intending to simulate, a summons, warrant, writ, or court process as a means for the collection of a claim, or to threaten legal proceedings against any debtor.
(2) Paragraph (1) of this subsection shall not prohibit:
(i) A collection agency from informing a debtor that if a claim is not paid, it will be referred to an attorney at law for such action as he may deem necessary, without naming a specific attorney.
(ii) A magisterial district judge from sending out notices to debtors before the institution of suit.
(g) Grading.--Whoever violates any of the provisions of this section is guilty of a misdemeanor of the third degree.
(h) Definitions.--As used in this section the following words and phrases shall have the meanings given to them in this subsection:
"Claim." Includes any claim, demand, account, note, or any other chose in action or liability of any kind whatsoever.
"Collection agency." A person, other than an attorney at law duly admitted to practice in any court of record in this Commonwealth, who, as a business, enforces, collects, settles, adjusts, or compromises claims, or holds himself out, or offers, as a business, to enforce, collect, settle, adjust, or compromise claims.
"Creditor." Includes a person having or asserting such a claim.
"Debtor." Includes any person against whom a claim is asserted.
(Dec. 19, 1990, P.L.1451, No.219, eff. imd.; Nov. 30, 2004, P.L.1618, No.207, eff. 60 days)
2004 Amendment. Act 207 amended subsec. (f)(2). See section 29 of Act 207 in the appendix to this title for special provisions relating to construction of law.
1990 Amendment. Act 219 amended subsecs. (a) and (b) and added subsec. (b.1).