Bill > HB4906

This bill amends the Michigan Occupational Code to clarify and update requirements for trust accounts maintained by collection agencies. The bill modifies language regarding how and where collection agencies must handle money collected on behalf of clients, replacing "shall" with "must" for more definitive phrasing. Specifically, collection agencies are now required to deposit collected money into a separate trust account within 3 banking days of receipt, and this account must be established at a state or nationally chartered bank, savings and loan association, savings bank, or credit union. The bill further specifies that a collection agency initiating collection activity in Michigan must maintain its trust account within the state, removing previous language that allowed out-of-state agencies to maintain accounts in their home state. The trust account must be clearly identified as a separate trust account, distinct from the agency's personal or general accounts, and must always contain sufficient funds to pay money owed to clients. The bill also maintains provisions allowing collection agencies to periodically withdraw funds that have accrued to them from collections or adjustments, while ensuring that disbursements are primarily made to clients or for client-related expenses.

Government Affairs

https://legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-4906