The Indiana Court of Appeals addressed an issue of first impression by holding that out-of-state companies must have an Indiana location before they need to obtain a license under Indiana’s Uniform Consumer Credit Code (IUCCC). Therefore, a collection agency with its principal place of business in another state is only required to obtain a license from the Indiana Secretary under the IUCCC either to take an assignment or to collect on a debt that had been purchased from the original lending institution if that business has a physical location within Indiana.
The plaintiff alleged violations of the Fair Debt Collection Practices Act and the Indiana Deceptive Consumer Sales Act because the debt buyer is not licensed under the IUCCC to take assignments of Indiana debts or to collect on those debts, and it does not otherwise meet the IUCCC’s description of those entities authorized to “undertake direct collection of payments from debtors arising out of consumer loans.” The Court of Appeals determined that the IUCCC’s licensure provision does not apply to the agency because it is a foreign limited liability company with its principal place of business in another state, and it does not have a physical location within Indiana. Because the debt collector was not required to obtain a license under the IUCCC, the trial court’s dismissal of the plaintiff’s claims under the FDCPA and state law was proper.
In reaching this decision, the Court of Appeals of Indiana joined the United States District Court for the Northern District of Indiana’s decisions in rejecting the notion that an out-of-state company accepting assignment of an Indiana consumer loan without physically entering the state must have a loan license. See Scheetz v. PYOD LLC, No. 3:12-CV-811-JD-CAN, 2013 WL 5436943 (N.D. Ind. Sept. 26, 2013); Havens v. Portfolio Investment Exchange, Inc., ___ F. Supp. 2d ___, 2013 WL 6086158 (N.D. Ind. Aug. 15, 2013).