House 4382

WEST VIRGINIA LEGISLATURE

2026 REGULAR SESSION

Introduced

House Bill 4382

By Delegates Burkhammer and Heckert

[Introduced January 15, 2026; referred to the Committee on the Judiciary]

A BILL to amend and reenact §47-16-4 of the Code of West Virginia, 1931, as amended, relating to requiring collection agencies to notify debtors of wage garnishments 30 days prior to that action by certified mail; and to send monthly statements showing balance owed.

Be it enacted by the Legislature of West Virginia:

ARTICLE 16. COLLECTION AGENCIES.

§47-16-4. Requirements for conduct of agency.

(a) License. -- No person, firm, corporation or association shall may conduct within this state a collection agency without having first applied for and obtained a business franchise registration certificate pursuant to §11-12-2 of this code, nor shall may any person, firm, corporation or association establish or operate a collection agency or the business of a collection agency, unless such person, firm, corporation or association maintains an office within the State of West Virginia. The business franchise registration certificate shall be deemed the collection agency's license. A license is required for each collection agency, including each principal office and all branch offices thereof.

(b) Bond. -- Each applicant shall file with the commissioner a continuing surety bond executed by a corporation which is licensed to transact the business of fidelity and surety insurance in the State of West Virginia to run concurrently with the registration tax period, which bond must shall be filed with, and approved by, said commissioner before the license herein provided may be issued. A separate bond shall be filed for each collection agency including each principal office and all branch offices thereof. Each bond shall be in the amount of $5,000 payable to the State of West Virginia, and conditioned that any such person will pay all damages to the state or a private person resulting from any unlawful act or action by such that person or his or her or its agent in connection with the conduct of the business of the collection agency. This continuing bond shall be filed with the Tax Commissioner.

An action may be brought in any court of competent jurisdiction upon the bond by any person to whom the licensee fails to account and pay as set forth in such that bond. The aggregate liability of the surety for all breaches of the condition of the bond shall may not exceed the sum of such the bond.

Upon entering judgment for the prevailing party in any action on the bond required by this article, the court shall include in the judgment, reasonable compensation for the services of such the party's attorney in the action.

The license of any licensee shall be void upon termination of the bond of the surety company, unless, prior to such termination, a new bond has been filed with the commissioner.

Should If the license of any surety company to transact business in this state be is terminated, all bonds given pursuant to this article upon which such the company is surety shall thereupon be suspended, and the commissioner shall immediately notify each affected licensee of such the suspension and require that a new bond be filed. This notice shall be by registered or certified mail, return receipt requested, and shall be addressed to the licensee at his or her or its principal place of business as shown by the commissioner's records. The failure of any licensee to file a bond with new or additional surety within 30 days after being advised in writing by the commissioner of the necessity to do so shall be cause for the commissioner to revoke the license.

(c) Record Keeping. -- Each collection agency licensed to operate in this state shall keep a record of all sums collected by such the agency and of all disbursements made by such the agency, and shall maintain or make available all such records and all records as to customers' funds at such the agency's principal place of business within this state. Each collection agency shall maintain records of collections for and payments to customers for a period of six years from the date of last entry therein.

No collection agency, nor any employee thereof, shall may intentionally make a false entry in any such collection agency record nor intentionally mutilate, destroy or otherwise dispose of any such record within the time limits provided in this section. Such The records shall at all times be open for inspection by the commissioner, or his or her duly appointed representative.

No licensee shall may commingle the money of collection agency customers with other moneys, but shall maintain a separate trust account in a bank for customers' funds.

Each collection agency shall, within a period of 30 days after the close of each and every calendar month, pay to such the agency's customers the net proceeds due on all collections made during the preceding calendar month. When the net proceeds due the customer are less than $5 at the end of any calendar month, the collection agency may defer for a period not to exceed ninety days the payment of said proceeds, if monthly statements are mailed or delivered to the customer.

(d) Collection agencies may not cause a garnishment of wages to be executed for an unpaid debt, unless the collection agency notifies the debtor of that action by certified mail 30 days prior to execution of garnishment of wages.  The collection agency shall send the debtor by certified mail a monthly statement indicating the amount collected by garnishment of wages and the balance of the debt owed.

NOTE: The purpose of this bill is to require collection agencies to notify debtors of wage garnishments 30 days prior to that action by certified mail.

Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.