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JBaxLaw, Attorney
Category: Business Law
Satisfied Customers: 11396
Experience:  Experienced in business formation and licensing issues
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I am licensed as a financial company as I was buying debt from

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I am licensed as a financial company as I was buying debt from towing operators. I have been hit by the state becasue of a complaint from a past empoloyee stating I am a collection agency. I am not-nor do I want to be. I am a settlement company, aiding towing operators. 1099 status is what I want. employed for my services. These debts are NOT in DEFAULT when they are assigned to me. According to FDCPA, under definitions 803 Debt collector, it state IT DOES NOT INCLUDE -- F-iii: "concerns a debt which was not in default at the time it was obtained by such person" These debts have never been noified to oweing person. I am the first contact on the task of collecting this debt. Can I be a 1099 and assist in the "settlement" of these debts with the towing companies?

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If facing a complaint under state law, ones concern would be the state law definition and regulation of a collection agency. The definition under federal law would have no bearing on the issue in such circumstances. The definition under the FDCPA is only applicable as to that set of regulations. State's are free to expand regulations to govern even those collecting debts not in default.

In Washington, a collection agency must be licensed. There are exceptions depending on whether the collection activity is carried on in the business's name which is the original creditor. However, under the state law definition it does not limit regulation to debts in default. See the definitions at:

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