MINUTES OF THE

      SENATE COMMITTEE ON COMMERCE AND LABOR

 

      Sixty-seventh Session

      February 16, 1993

 

 

The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 1:30 p.m., on Tuesday, February 16, 1993, in Room 207/208 Cashman Field Center, Las Vegas, Nevada.  Exhibit A is the Meeting Agenda.  Exhibit B is the Attendance Roster.

 

 

COMMITTEE MEMBERS PRESENT:

 

Senator Randolph J. Townsend, Chairman

Senator Sue Lowden, Vice Chairman

Senator Ann O'Connell

Senator Mike McGinness

Senator Raymond C. Shaffer

Senator Leonard V. Nevin

Senator Lori L. Brown

 

 

STAFF MEMBERS PRESENT:

 

Brian Davie, Senior Research Analyst

Sheri Asay, Committee Secretary

Linda Krajewski, Primary Secretary

Frank Krajewski, Senior Research Analyst

 

OTHERS PRESENT:

 

Richard Beatty, Vice President, Nevada Collectors Association

Mary Santina, Lobbyist, Nevada Collectors Association

 

 

Senator O'Connell opened the meeting. She stated that the purpose of the meeting was to hear from financial associations other than banks. Senator O'Connell introduced Richard Beatty, Vice President, Nevada Collectors Association (NCA).

 

Mr. Beatty testified regarding NCA's Bill Draft Request (BDR) 54-1369.

 

BDR 54-1369:     Makes various changes concerning collection        

                  agencies.

 

The bill draft recommends changes to Nevada Revised Statutes (NRS) 649. He said the reason for the changes was to "enable the FID (Financial Institutions Division) to cause the closure of a collection agency when they are out of trust, if they are acting improperly with monies that are being held in trust, and basically putting teeth in the current law."

 

Mr. Beatty said they also thought, "Something should happen with an agency that has been closed, and the proper notification should go to the creditors that assigned accounts through that agency for collection."

 

Senator O'Connell advised Mr. Beatty on how to process BDR 54-1369.

 

Mary Santina, Lobbyist, Nevada Collectors Association (NCA), explained that the BDR was requested by Assemblyman Rick Bennett, and would more than likely be introduced by the assembly. She responded to Senator O'Connell's remarks about processing the BDR, and told the committee what the NCA has done to clean it up for introduction.

 

Senator Nevin asked about prior problems with collections agencies.

 

Mr. Beatty replied, "...it's companies that have been in business, have shut down, and are still within the state, acting with the same records, trying to collect."

 

There was discussion on current federal legislation that would affect collection agencies. Ms. Santina mentioned legislation under consideration by the assembly regarding the Fair Credit Reporting Act. She said this would help in correcting consumer complaints within the State of Nevada.

 

Senator Shaffer expressed concern about collection agencies turning names and accounts over to credit bureaus. Mr. Beatty responded that his collection agency "reports accounts that have been assigned for collection to the three national credit reporting facilities, 45 days after they have been received and the first notice has been supplied to the consuming debtor." He explained that this procedure allows the consumer to present proof that the account has been paid, or to resolve the debt prior to it becoming a matter of record with the national credit reporting facility.

 

Ms. Santina added further information regarding the process.

 

In response to a question by Senator O'Connell regarding trust control auditing procedures, Mr. Beatty said that trust accounting was addressed in BDR 54-1369. He further explained that the Nevada Collectors Association had asked that the, "FID prepare a handbook and specifically set out the rules of what will actually be addressed when auditing a collection agency's books." Mr. Beatty added that the handbook has not been prepared, as of yet.

 

There was further discussion on auditing the trust account.

 

Senator O'Connell suggested the NCA set aside funds, collected from fines, to hire an auditor who has expertise in these types of audits. Mr. Beatty said that would be a possibility.

 

Ms. Santina added that the Attorney General's Office had recommended changes to their original draft on exemptions for collection agencies. There was further discussion on exemptions.

 

There being no further business, the meeting was adjourned at 2:05 p.m.

 

 

            RESPECTFULLY SUBMITTED:

 

 

 

                                    

            Sheri Asay,

            Committee Secretary

 

 

 

APPROVED BY:

 

 

 

 

                                     

Senator Randolph J. Townsend, Chairman

 

 

DATE:                                 

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Senate Committee on Commerce and Labor

February 16, 1993

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