A collection agency bond is a surety bond that lends credibility to the bonded agency and protects its clients. Collection agencies have a reputation of unpopularity among the general public, as they make it their business to collect on their unpaid debts. Combined with the fact that they handle sensitive customer information such as financial details, this makes them quite high risk as companies. Having a surety bond in place to protect both the clients and themselves is thus a must.
This bond shows that, according to the state of Arizona, the collection agency in question offers ethical and professional services. This can improve the reputation of the company in the eyes of the public, as it helps to circumvent some of the negative stereotypes surrounding the industry. Should it turn out that the agency in question is not as reputable it may have seemed, collection agency bonds in Arizona also protect the customers in the event that they have encountered illegal or unethical business practices.
Practices that are considered unlawful by the state include failure to maintain proper licenses, employing unlicensed agents or receiving compensation from unlicensed agents, not keeping accurate collection records, or failing to pay out clients after collection. In addition, unethical and unlawful harassment of debtors such as publicly advertising their debts is cause for a claim to be made against the agency. Should these or other conditions indicating illegal or unethical behaviour be met, the required surety bonds will cover any damages caused to clients by unlawful acts up to the bonding amount.
In addition to obtaining this bond, those interested in becoming bonding agents in Arizona must pass background checks for all partners and high level employees, submit credit reports, and provide a valid certificate of good standing. These requirements ensure the safety of all clients’ financial and personal information, and offer clients peace of mind. As large amounts of money often change hands via collection agencies, it is important to complete all necessary paperwork and obtain all necessary surety bonds. It’s not only good business, it’s the law. Click here to learn more about Collection Agency Bonds in Arizona.
