Sections 45-601 to 45-622 shall be known and may be cited as the Collection Agency Act.

No person, firm, corporation, or association shall conduct or operate a collection agency or do a collection agency business as defined in the act until he, she, or it has secured a license as provided in the act. Any person, firm, corporation, or association conducting or operating such a collection agency or doing such a collection agency business without a license shall be guilty of a Class III misdemeanor for each day that such unlawful business is conducted. Any officer or agent of a firm, corporation, or association who personally participates in any violation of the act shall be guilty of a Class III misdemeanor.

Nothing contained in this section shall be construed to require a regular employee of a collection agency duly licensed as such in this state to procure a collection agency license.

Nothing in the act shall be construed to prohibit a person, firm, corporation, or association regulated as a collection agency in another state and residing in another state from communicating with a debtor in this state.

For purposes of the Collection Agency Act:

(1) Board means the Collection Agency Licensing Board;

(2) Collection agency means and includes:

(a) All persons, firms, corporations, and associations directly or indirectly engaged in soliciting, from more than one person, firm, corporation, or association, claims of any kind owed or due or asserted to be owed or due such solicited person, firm, corporation, or association, and all persons, firms, corporations, and associations directly or indirectly engaged in asserting, enforcing, or prosecuting such claims;

(b) Any person, firm, corporation, or association which, in attempting to collect or in collecting his, her, or its own accounts or claims, uses a fictitious name or any name other than his, her, or its own name which would indicate to the debtor that a third person is collecting or attempting to collect such account or claim; and

(c) Any person, firm, corporation, or association which attempts to or does give away or sell to any person, firm, corporation, or association, other than one licensed under the act, any system or series of letters or forms for use in the collection of accounts or claims which assert or indicate, directly or indirectly, that the claim or account is being asserted or collected by any other person, firm, corporation, or association other than the creditor or owner of the claim or demand;

(3) Collection agency does not mean or include (a) regular employees of a single creditor, (b) banks, (c) trust companies, (d) savings and loan associations, (e) building and loan associations, (f) abstract companies doing an escrow business, (g) duly licensed real estate brokers and agents when the claims or accounts being handled by such broker or agent are related to or are in connection with such brokers' or agents' regular real estate business, (h) express and telegraph companies subject to public regulation and supervision, (i) attorneys at law handling claims and collections in their own names and not operating a collection agency under the management of a layperson, (j) any person, firm, corporation, or association handling claims, accounts, or collections under an order or orders of any court, or (k) a person, firm, corporation, or association which, for valuable consideration, purchases accounts, claims, or demands of another and then, in such purchaser's own name, proceeds to assert or collect such accounts, claims, or demands; and

(4) Nationwide Mortgage Licensing System and Registry means a licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of mortgage loan originators, mortgage bankers, installment loan companies, and other state-regulated financial services entities and industries.

(1) There is hereby created the Collection Agency Licensing Board which shall consist of the Secretary of State, who shall be chairperson of the board, and four members appointed by the Governor. Three of the members appointed by the Governor shall be licensees actively engaged in the collection business in this state, one of whom shall reside in each of the state's three congressional districts. The remaining member shall be appointed at large as a representative of the public. Such person shall not be a licensee actively engaged in the collection business in this state.

(2) The term of office of each appointed member shall be for four years, except that of the members of the first board appointed under this section, two shall be appointed for a term of two years. Before a member's term expires, the Governor shall appoint a successor to take office on the expiration of the member's term. A member shall continue to serve after the expiration of his or her term until a successor is appointed and qualified. A vacancy in the office of a member shall be filled by appointment for the unexpired term.

(3) The members of the board shall be reimbursed for expenses as provided in sections 81-1174 to 81-1177.

(4) The board may employ such persons as may be necessary to carry out the Collection Agency Act, fix the salaries of such employees, and make such other expenditures as are necessary to properly carry out the act, except that all remuneration, expenses, salaries, and expenditures provided for in the act shall be paid out of the Secretary of State Cash Fund.

(5) The Secretary of State shall keep a record of all the proceedings, transactions, communications, and official acts performed pursuant to the act and perform such other duties as may be necessary to carry out the intent and purpose of the act.

The board may enact rules and regulations relating to the administration of, but not inconsistent with, the Collection Agency Act.

The board shall be responsible for the administration of the Collection Agency Act. All applications for licenses provided for in the act shall be made to the board. If the applicant is an individual, the application shall include the applicant's social security number. The board shall investigate the qualifications of each applicant for a license. Based on the results of the investigation, the board may either issue a license to the applicant upon the payment of the license fee and any processing fee allowed under section 45-605.01 and the furnishing of the bond provided for in section 45-608 or refuse to issue such license. The action of the board may be appealed, and the appeal shall be in accordance with the Administrative Procedure Act.

(1) Effective October 1, 2020, or within one year after the Nationwide Mortgage Licensing System and Registry is capable of processing licenses issued under the Collection Agency Act, whichever is later, the board, upon its discretion, may require licensees under the act to be licensed and registered through the Nationwide Mortgage Licensing System and Registry. In order to carry out this requirement, the board may participate in the Nationwide Mortgage Licensing System and Registry. For this purpose, the board may establish, by adopting and promulgating rules and regulations or by order, requirements as necessary. The requirements may include, but not be limited to:

(a) Any information as deemed necessary by the Nationwide Mortgage Licensing System and Registry;

(b) The payment of fees to apply for or renew a license provided for in sections 45-606 and 45-620 and any processing fee allowed under this section through the Nationwide Mortgage Licensing System and Registry;

(c) The setting or resetting, as necessary, of renewal processing or reporting dates; and

(d) Amending or surrendering a license or any other such activities as the board deems necessary for participation in the Nationwide Mortgage Licensing System and Registry.

(2) In order to fulfill the purposes of the Nebraska Collection Agency Act, the board may establish relationships or contracts with the Nationwide Mortgage Licensing System and Registry or other entities designated by the Nationwide Mortgage Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to the act. The board may allow such system to collect licensing fees on behalf of the board and allow such system to collect a processing fee for the services of the system directly from each licensee or applicant for a license.

(3) The board shall regularly report enforcement actions and other relevant information to the Nationwide Mortgage Licensing System and Registry.

(4) The board shall establish a process whereby applicants and licensees may challenge information entered into the Nationwide Mortgage Licensing System and Registry by the board.

(5) The board shall ensure that the Nationwide Mortgage Licensing System and Registry adopts a privacy, data security, and breach of security of the system notification policy. The board shall make available upon written request a copy of the contract between the board and the Nationwide Mortgage Licensing System and Registry pertaining to the breach of security of the system provisions.

(6) Upon written request, the board shall provide the most recently available audited financial report of the Nationwide Mortgage Licensing System and Registry.

(1) Any person, firm, corporation, or association desiring to engage in this state in the collection business under the Collection Agency Act shall make written and sworn application for such license to the board upon a form to be prescribed by the board, which application shall be accompanied by an investigation fee of not to exceed two hundred fifty dollars and any processing fee allowed under section 45-605.01. The amount of the investigation fee shall be fixed by the board and shall not exceed the amount actually necessary to sustain the administration and enforcement of the act. Such application shall be accompanied by a duly verified financial statement of the applicant in form prescribed by the board. The Secretary of State shall remit the fees received pursuant to this section to the State Treasurer for credit to the Secretary of State Cash Fund.

(2) The board may require applicants to utilize the Nationwide Mortgage Licensing System and Registry or an entity designated by the Nationwide Mortgage Licensing System and Registry for the processing of applications and fees.

(1) The license provided for by section 45-606 shall be granted only to applicants who are trustworthy, who have a good reputation for honesty and fair dealings, who are financially responsible, and who are, in the opinion of the board, competent to engage in the collection of accounts and claims of others. No license shall be issued to a partnership, limited liability company, corporation, or association unless the manager or executive officer thereof has been engaged in the collection business either as owner, officer, partner, member, or employee of an established reputable collection agency for a period of at least two years, except that the board may, if satisfied that the applicant or the manager or executive officer thereof has had sufficient business experience to be fully competent to engage in the collection business without such previous collection experience, approve such application.

(2) No such license shall be issued to any person, firm, limited liability company, corporation, or association who or which is not a resident of this state or does not keep and maintain a regular office in this state in which are kept complete records of collections and claims handled by such person, firm, limited liability company, corporation, or association for creditors residing in this state and against debtors residing in this state, except that a foreign corporation or limited liability company duly authorized, admitted, and licensed to do business in this state may be issued such a license if it complies with all requirements of the Collection Agency Act, nor shall any license be issued to any person, firm, limited liability company, corporation, or association who or which or the principal officers of which have, within the past five years, been convicted in any court of fraud or have been convicted of or had judgment entered against them in any court for failure to account to their client or customer for money or property collected by them for such client or customer.

No license shall be issued under section 45-607 until the applicant has furnished a good and sufficient corporate surety bond in the sum of fifteen thousand dollars for those agencies or foreign corporations having sixteen or more licensed solicitors, ten thousand dollars for any agency having five to fifteen licensed solicitors, and five thousand dollars for any agency having less than five solicitors, payable to and approved by the board and conditioned that the licensee shall faithfully and truly perform all agreements entered into with the licensee's clients or customers and shall, within forty-five days after the close of each calendar month, report to and pay to his, her, or its client or customer the net proceeds of all collections made during the preceding calendar month and due to each client or customer, which bond shall be in such form as approved by the board and shall be filed in the office of the Secretary of State. No person shall be required to post a bond in excess of one hundred thousand dollars.

An action may be brought in any court of competent jurisdiction upon such bond by any person to whom the licensee fails to account and pay as set forth in such bond or who has been damaged by failure of the licensee to comply with all agreements entered into with such person, except that the aggregate liability of the surety to all such persons shall, in no event, exceed the sum of such bond.