Bill > HB6418

This bill amends Michigan’s occupational code to regulate debt collectors and collection agencies by prohibiting them from contacting a debtor about a purchased, assigned, or transferred claim without first sending a detailed written notice at least five days in advance, which must include information such as the outstanding amount, the original creditor, and instructions on how to halt collection efforts if the debt resulted from economic abuse. Economic abuse is defined as behavior by another person that is coercive, deceptive, or unreasonably controls an individual's ability to acquire, use, or maintain economic resources, and collectors must immediately cease collection activities upon receiving valid documentation of such abuse—such as a personal protection order, police report, or a report signed by a qualified third party like a domestic violence advocate, health professional, or member of the clergy. Additionally, the bill updates statutory penalties by increasing the minimum civil recovery for harmed consumers from $50 to $5,000, and raising the penalty for willful violations to three times actual damages or $15,000 (whichever is greater), while making it mandatory to award reasonable attorney fees and court costs; these changes are tied to the enactment of a separate related measure, House Bill 6419.