Civil Code section 1788.301
(a)
“Debt settlement provider” means a person who, for compensation and on behalf of a consumer, provides debt settlement services.(b)
“Debt settlement services” means any of the following:(1)
Providing advice, or offering to act or acting as an intermediary, including, but not limited to, offering debt negotiation, debt reduction, or debt relief services between a consumer and one or more of the consumer’s creditors, if the primary purpose of that advice or action is to obtain a settlement for less than the full amount of the debt.(2)
Advising, encouraging, or counseling a consumer to accumulate funds in an account for future payment of a reduced amount of debt to one or more of the consumer’s creditors.(c)
“Settlement account” means a depository account established and used for the purpose of holding funds of a consumer to be distributed to a creditor in the event of a settlement of a consumer’s debt with the creditor.(d)
“Consumer” means a person who is allegedly legally responsible for a debt.(e)
“Person” means a natural person or entity, whether a corporation, partnership, association, trust, limited liability company, cooperative, or other organization.(f)
“Creditor” means the person who originated the debt or is assigned, or has purchased for collection, a debt for which a consumer is allegedly legally responsible.(g)
“Debt” means money, whether in principal, interest, fees, or other charges, which is due or owing or alleged to be due or owing from a natural person to another person and incurred primarily for personal, family, or household purposes.(h)
“Payment processor” means a person who provides payment processing services.(i)
“Payment processing services” means accepting, maintaining, holding, or distributing funds, or facilitating the acceptance, maintenance, holding, or distribution of funds, on behalf of a consumer for the purpose of facilitating debt settlement services.
Source:
Section 1788.301, https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV§ionNum=1788.301. (updated Jan. 1, 2022; accessed Dec. 1, 2025).
