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House approves higher bond requirement for collection agencies
Summary
The House passed House Bill 91 to raise the required bond for collection agencies from $5,000 to $10,000 and require a surety bond to better protect clients; the bill passed the House 70–1 and will be sent to the Senate.
The Utah House on the floor approved House Bill 91, raising the minimum bond collection agencies must post from $5,000 to $10,000 and requiring a surety bond rather than cash or alternative instruments to guarantee consumer protections.
Representative Brown, the bill sponsor, told colleagues the Department of Commerce had documented cases in which small collection agencies posted only the $5,000 bond, then collected sums larger than that and left clients with unrecovered losses when the agencies vanished. "What we're doing in this bill, essentially, is raising the bond limit from $5,000 to $10,000 ... to guarantee the integrity of the process," Representative Brown said.
Brown said representatives of collection agencies attended committee and supported the change; the sponsor characterized the measure as a first step that may need future adjustment. "It may have to be revisited in the future and even increase the limit further," Brown said.
The House opened and closed debate without further speakers and then voted. The roll call showed 70 aye votes and 1 nay. The bill passed the House and will be referred to the Utah Senate for further action.
The measure, as described on the floor, replaces prior bond options with a surety bond requirement intended to strengthen consumer recourse when small collection firms fail to remit recovered funds. No amendments or implementation dates were specified on the floor record; the bill will proceed to the Senate for consideration.
