Chicago — MCC § 4-6-160 (debt collector licence + conduct duties) and EO 2025-10

Municipal jurisdiction. Chicago is a third layer, not a substitute: federal law (FDCPA / Reg F) and Illinois law (the Collection Agency Act, IDFPR licensing, the Consumer Fraud Act) apply in full, and § 4-6-160 stacks on top. Read state/il.md with this page — the state page owns SOL, revival and the IDFPR licence and bond.

The common description of Chicago as "just a second licence on top of the state one" is wrong. § 4-6-160(b) imposes free-standing duties — a city validation notice, a cease-until-verify with prescribed itemization, and a per-debt recordkeeping regime — and it reaches first-party creditors, who are outside the Illinois Collection Agency Act.

Authority

Two instruments, one ordinance and one executive order.

1. MCC § 4-6-160, "Debt Collectors." Added by Substitute Ordinance SO2012-8555, introduced 2012-12-12 by Mayor Emanuel with Ald. Mitts, Solis and Pawar, recommended by the Committee on License and Consumer Protection 2013-01-15, passed 2013-01-17, in force 2013-07-01. The same ordinance added "debt collectors" to the regulated-business-licence list at MCC § 4-6-010(c)(15), so a debt collector needs a Regulated Business License. Administered by the Department of Business Affairs and Consumer Protection (BACP).
2. Executive Order No. 2025-10, "Prohibiting the Sale or Assignment of City-Owned Medical Debt and Establishing Fair, Public-Interest Debt Recovery Practices" — signed by Mayor Brandon Johnson and received and filed with the City Clerk on 2025-12-23 (Clerk's stamp: 2025 DEC 23 PM 12:36). It binds City-administered debt recovery, and obliges the City to impose those standards on third parties that collect its debt. Verified from the signed original.

⚠ Source currency — enacted text, not consolidated code

The verbatim § 4-6-160 text below is quoted from the enacting ordinance as published by the Office of the City Clerk. The consolidated Municipal Code is published only at codelibrary.amlegal.com, which Cloudflare-403s automated fetch, an ordinary browser request and headless Chrome, and has no Internet Archive coverage — so the current consolidated section could not be read. Chicago is also not a Municode client (checked against the publisher's own client API for Illinois, which lists only suburban Chicago-named municipalities), so there is no second code host to fall back to.

• The text below is what the City Council enacted, and is citable as such.
• Any amendment after 2013-01-17 would be invisible here. No amendment was located, but absence of evidence is not evidence of absence, and Chicago's Legistar webapi returns a server-side configuration error, so no automated amendment sweep was possible.
• Re-verification action: pull MCC § 4-6-160 from a live browser session and diff against the quotes below. Until then treat the section as currently consolidated as UNVERIFIED, while treating the enacted text as verified.

What this adds over state law

Each row is Chicago measured against state/il.md. The state analysis is not restated here.

Layer	Chicago vs Illinois
Licence / registration	ADDS. A Regulated Business License (MCC §§ 4-6-010(c)(15), 4-6-160) on top of the IDFPR Collection Agency licence. One licence per business location. Exemption borrowed wholesale from 225 ILCS 425/2.03.
Bond	N/A at city level. Illinois' $25,000 IDFPR bond still applies — see state/il.md.
Conduct rules stricter than state	ADDS. § 4-6-160(b)(2)–(3): a city validation notice, cease-until-verify, prescribed verification itemization, and per-debt recordkeeping. Reaches first-party creditors — the definition covers collecting "on behalf of himself or others."
Disclosures	ADDS. A five-element written notice within 5 days of initial communication (§ 4-6-160(b)(2)(A)), with a front-of-notice pointer if the disclosures are printed on the back.
Dispute / verification	ADDS — the strongest row. Verification must be a statement of account itemizing pre-charge-off interest/charges/fees, the original charge-off balance, the principal balance if different, post-charge-off interest/charges/fees, and the basis of the obligation (§ 4-6-160(b)(2)(B)). Federal law prescribes no verification content.
Credit reporting	N/A. No Chicago provision. Reg F § 1006.30 governs.
Medical debt	ADDS, for City-owned debt only — and narrowly. EO 2025-10 § 1 bars any City department from selling, assigning or transferring an individual's medical debt, but the order defines medical debt as debt owed to the City "incurred as a result of the provision of emergency medical response services." It does not reach private medical AR, and it is not a general medical-debt rule.
Debt purchase	ADDS, one-way. EO § 1 is a supply restriction on debt buyers, not a conduct rule: City EMS paper is off the market. Nothing in it restricts what a buyer may do with debt it lawfully holds.
Fees / rate caps	N/A. No collection-fee or rate cap. The licence fee is $1,000 per two years (2026).
SOL / revival	SAME AS STATE — do not answer this from this page. 735 ILCS 5/13-206 (10y written) and 13-205 (5y unwritten) govern, with the UCC 3-118 and written-revival wrinkles; see state/il.md.
Private right of action	UNVERIFIED. § 4-6-160(e) provides City fines; whether the MCC affords a private action was not established. Do not assert either way.

Who is covered

"Debt Collector" means any person who in the ordinary course of business, on behalf of himself or others, regularly engages in consumer debt collection. A "Debt Collector" does not include any person exempt from registration as a debt collector pursuant to section 2.03 of the Illinois Collection Agency Act, 225 ILCS 425/2.03. — MCC § 4-6-160(a)

"On behalf of himself or others" pulls in first-party collection. This is the single most consequential word choice on the page: an original creditor collecting its own consumer debt in the ordinary course of business is a "debt collector" for Chicago purposes, though it is not one under the FDCPA. The only escape is the 225 ILCS 425/2.03 exemption list, which Chicago adopts wholesale rather than writing its own — so the city exemption analysis is the state exemption analysis. See state/il.md before concluding anyone is out.

"Debtor" means any natural person who resides in the city and from whom a debt collector seeks to collect consumer debt. — MCC § 4-6-160(a)

The trigger is the consumer's residence in Chicago — the same shape as NYC, and unlike Buffalo, whose trigger is activity in the city. Note the interaction with the per-location licence: the duties in (b) attach to Chicago residents, while the licence attaches to business locations.

"Consumer debt" means money, property, or their equivalent, due or owing, or alleged to be due or owing, from a debtor by reason of a consumer credit transaction.

"Debt collection" means any act or practice in connection with the collection of consumer debt. — MCC § 4-6-160(a)

Consumer credit transactions only. Commercial paper is out; so, on this wording, is consumer debt not arising from a credit transaction.

Legal duties — § 4-6-160(b)

(1) Compliance with other law, as a City duty

comply with all applicable state and federal laws and regulations regulating the collection of consumer debt, including, but not limited to, the Fair Debt Collection Act, 15 U.S.C. §1692, the Illinois Collection Agency Act, 225 ILCS 425/1, and the Consumer Fraud and Deceptive Practices Act 815 ILCS 505/1. — MCC § 4-6-160(b)(1)

This converts every FDCPA, ICAA and Consumer Fraud Act violation into an independent Chicago licence violation, exposing the collector to the § 4-6-160(e) fines and to licence revocation on top of whatever the underlying statute provides. It is the quiet multiplier on this page.

(2)(A) The Chicago validation notice — 5 days

unless otherwise restricted or prohibited from communicating with the debtor by state or federal law, within 5 days of the initial communication with a debtor in connection with the collection of consumer debt, a debt collector shall, unless the following information was contained in the initial communication or the debtor has paid the consumer debt, send the debtor a written notice with each of the following disclosures: (i) the amount of the consumer debt; (ii) the name of the creditor to whom the consumer debt is owed; (iii) that, unless the debtor, within 30 days after receipt of the notice, disputes the validity of the consumer debt, or any portion thereof, the debt collector will assume the consumer debt to be valid; (iv) that, if the debtor notifies the debt collector in writing within the 30-day period that the consumer debt, or any portion thereof, is disputed, the debt collector will obtain verification of the consumer debt or a copy of a judgment against the debtor and will mail a copy of the verification or judgment to the debtor; (v) that, upon the debtor's written request within the 30-day period, the debt collector will provide the debtor with the name and address of the original creditor, if different from the current creditor.

If the disclosures are placed on the back of the notice, the front of the notice shall contain a statement notifying the debtors of the fact. — MCC § 4-6-160(b)(2)(A)

The five elements track FDCPA § 1692g(a)(1)–(5). What matters is that they are now a City duty owed by first-party creditors too, and that the front-of-notice pointer is mandatory where disclosures appear on the reverse.

(2)(B) Cease-until-verify, with prescribed itemization

If the debtor notifies the debt collector in writing within the 30-day period set forth in subsection (b)(2)(A) that the consumer debt, or any portion thereof, is disputed or that the debtor requests the name and address of the original creditor, the debt collector shall cease collection of the consumer debt, or any disputed portion thereof, until the debt collector obtains verification of the consumer debt or a copy of a judgment or the name and address of the original creditor and mails a copy of the verification or judgment or name and address of the original creditor to the debtor.

For purposes of this subsection (b)(2), verification of the consumer debt shall include a statement of account that: (i) itemizes the interest, charges and fees claimed to be owed prior to the charge-off, the original charge-off balance, and the principal balance, if different from the charge-off balance; (ii) itemizes any interest, charges or fees claimed to be owed after the charge-off balance; and (iii) identifies and describes the basis of the debtor's obligation to pay. — MCC § 4-6-160(b)(2)(B)

This is the most valuable provision on the page. Federal law says a collector must "obtain verification" but has never defined it, and the case law has largely permitted a printout. Chicago prescribes the content: a statement of account with a pre-charge-off itemization of interest, charges and fees; the original charge-off balance; the principal balance if different; a separate post-charge-off itemization; and an identification of the basis of the obligation to pay.

For purchased paper this is a real operational burden — the pre-charge-off itemization typically lives with the originating creditor, not in the sale file.

(3) Per-debt recordkeeping

unless otherwise prohibited by state or federal law, commencing on July 1, 2013, a debt collector shall maintain a separate file, either in electronic or paper format, for each consumer debt that the debt collector attempts to collect from each debtor, in a manner that is searchable by the name, address and zip code of the debtor and the creditor who originated the consumer debt which the debt collector is seeking to collect. Each file shall contain the following records: (i) a record of all written communications with the debtor; provided that the debt collector shall produce a copy of any written communication with the debtor, in a manner and time, as requested or required by the commissioner; (ii) a record of each payment received from the debtor that states the date of receipt, the method of payment and the consumer debt to which the payment was applied; (iii) a copy of the consumer debt payment schedule or settlement agreement reached with the debtor to pay the consumer debt; and (iv) with regard to any consumer debt that the debt collector has purchased, a record of the name and address of the entity from which the debt collector purchased the consumer debt, the date of the purchase and the amount of the consumer debt at the time of purchase. — MCC § 4-6-160(b)(3)

Note the searchability mandate: files must be searchable by debtor name, address and zip and by the originating creditor. That is a data-model requirement, not a retention policy, and it goes well past Reg F § 1006.100's three-year retention rule. Subsection (iv) is a chain-of-title record for purchased debt — seller name and address, purchase date, and balance at purchase.

Licensing, fee and revocation

• Licence type: Regulated Business License (MCC § 4-6-010(c)(15)).
• Per location: "A separate license shall be required for each separate business location" (BACP, Debt Collectors fact sheet). "Business location" is not defined.
• Fee: $1,000 per two-year licence — see the subsection below, and do not use $250.
• Zoning review is part of the application (BACP fact sheet, Step 2).
• Revocation carries a four-year bar:

No person whose debt collector license under this chapter is revoked for any cause shall be granted a license under this section, under the same or different name, for a period of four years from the date of revocation. — MCC § 4-6-160(c)

The "under the same or different name" language is an anti-phoenix clause — a revoked operator cannot re-enter Chicago under a new entity for four years.

Rulemaking: the commissioner may promulgate implementing rules (§ 4-6-160(d)). No such rules were retrieved — check the City of Chicago Rules Portal before advising.

The fee — $1,000 per two-year licence

As of January 1, 2026, the fees are as follows: • Limited Business License: $500 for a two-year license • Regulated Business License: $1,000 for a two-year license — City of Chicago BACP, Business License Fee Updates

⚠ The widely cited "$250.00 per location, two-year term" is stale by a factor of four. It comes from BACP's 2013 fact sheet (v.11.19.13), which the City still hosts. Do not ship $250.

⚠ Effective 2026-01-01, not 2026-01-27. The later date is only the fee sheet's filename (20260127newfees.pdf) — a publication date, not an operative one. The document's own words are "As of January 1, 2026."

Penalties

In addition to any other penalty provided, any person who violates this section or any rule or regulation promulgated hereunder shall be fined not less than $250.00 nor more than $2,500.00 for the first offense and not less than $500.00 nor more than $5,000.00 for a second or any subsequent offense during any 12-month period. Each day that a violation continues shall constitute a separate and distinct offense. — MCC § 4-6-160(e)

The fines are mandatory-minimum and per day. Combined with (b)(1), a continuing FDCPA violation is also a continuing Chicago violation accruing a separate fine each day.

Executive Order No. 2025-10 — City-owned debt

Quoted from the signed original filed with the City Clerk (a scanned document with no text layer; transcribed from the page images). This governs the City's own receivables and, through the City, those who collect them. Its recitals ground it in the finding that debt owed to the City "most commonly arises from administrative fines and fees associated with essential civic systems," and that medical debt owed to the City "is incurred when residents seek emergency medical care, often under urgent circumstances and without meaningful choice."

Section 1 — the debt-sale prohibition, and its narrow definition:

No department of the City of Chicago shall sell, assign, or otherwise transfer any medical debt owed by an individual. For purposes of this Executive Order, medical debt refers to any debt owed to the City that is incurred as a result of the provision of emergency medical response services. — Exec. Order No. 2025-10, § 1

Section 2 — the standards, and the sentence that reaches private collectors:

All City-administered debt recovery efforts shall:

1. Comply with all applicable federal, state, and local consumer-protection laws;
2. Prohibit harassment, misrepresentation, coercion, or intimidation;
3. Provide clear notice, accessible dispute adjudication processes, and transparent accounting; and
4. Prioritize long-term compliance and resident stability over short-term extraction.

The City will require any third party involved in debt collection to conform to the City-administered debt recovery efforts specified above. — Exec. Order No. 2025-10, § 2

(The numbering is reproduced as it appears in the signed order, which skips item 4. Nothing is missing from this page.)

Effective date, from the order itself:

This Executive Order shall take effect upon its execution and filing with the City Clerk. — Exec. Order No. 2025-10, § 5

The signed original is completed "Received and filed on Dec 23, 2025" over the City Clerk's signature, and carries the Clerk's stamp 2025 DEC 23 PM 12:36. So the operative date is 2025-12-23, taken from the instrument rather than from the announcement.

Section 3 assigns implementation to the Office of Budget and Management, the Chief Financial Officer and the Comptroller, in consultation with the Department of Law; § 4 is severability.

⚠ The press release is not the order

The Mayor's press release says any private third party engaged in municipal debt collection "must also conform" to these standards — which reads as a direct duty on the collector. The signed order says "The City will require any third party involved in debt collection to conform" — a duty on the City to impose the standards, which in practice arrives as terms in a municipal collection contract rather than as freestanding municipal law. Quote the order.

The same divergence affects scope: the release describes the sale ban as covering medical debt "including debt incurred from emergency medical response services or ambulance transport," while § 1 defines the covered debt as debt owed to the City incurred from emergency medical response services. The release's wording reads inclusively; the order's reads definitionally, and the order controls.

Plain English (interpretation — the quotes win)

If you collect consumer debt from someone who lives in Chicago, you need a City licence in addition to your Illinois one — $1,000 every two years, one per business location — and you are subject to City duties that look like the FDCPA but bite harder in three places.

You must send a validation notice within five days of first contact, and you must do this even if you are the original creditor, because Chicago's definition covers collecting on your own behalf.

If the consumer disputes in writing within 30 days, you stop — and to restart you must send verification that actually itemizes: what interest, charges and fees were claimed before charge-off, what the charge-off balance was, what the principal was if different, what has been added since, and why this person owes it. A screenshot of a balance will not do.

You must keep a separate file per debt, searchable by the consumer's name, address and zip and by the creditor who originated the debt, holding every written communication, every payment, any settlement, and — for purchased paper — who you bought it from, when, and for how much.

Fines start at $250 and run to $5,000 for repeats, every day the violation continues. And if your licence is ever revoked, you are out of Chicago for four years, under any name.

Separately, if you collect debts owed to the City itself, EO 2025-10 reaches you — but as contract risk, not statutory liability. Its operative sentence obliges the City to require conformity, so the standards it names (no harassment, misrepresentation, coercion or intimidation; clear notice; an accessible dispute process; transparent accounting; resident stability over extraction) arrive as terms in a municipal collection contract. And the City will not sell you its EMS medical debt.

Traps / edge cases

1. Chicago reaches first-party creditors. "On behalf of himself or others" (§ 4-6-160(a)). An original creditor exempt from the FDCPA is not exempt here unless 225 ILCS 425/2.03 covers it. This is the most likely thing on the page to be missed.
2. The exemption is Illinois', not Chicago's. § 4-6-160(a) adopts 225 ILCS 425/2.03 by reference, so any change to the state exemption list silently changes Chicago's scope. Check state/il.md, and note that page's flag that ICAA § 2 has two unharmonised published versions.
3. Verification content is prescribed — and pre-charge-off data is the hard part. For purchased debt the itemization of interest, charges and fees before charge-off usually sits with the originating creditor. Whether you can produce it determines whether you can ever resume collection after a dispute.
4. The fee is $1,000/2yr, not $250. BACP's own 2013 fact sheet, still published, carries the stale figure.
5. The fee's effective date is 2026-01-01, not 2026-01-27. The later date is the fee sheet's filename, not its content — an easy citation error to inherit.
6. Fines accrue per day (§ 4-6-160(e)), with mandatory minimums.
7. A revocation is a four-year, name-proof exclusion (§ 4-6-160(c)) — materially worse than losing a licence you can reapply for.
8. Two different geographies in one section. Duties follow the debtor's residence in Chicago; the licence follows business location, one per location. A collector with no Chicago premises still owes the (b) duties to Chicago residents.
9. Commissioner's rules were not retrieved (§ 4-6-160(d)). There may be implementing rules that add detail; check the City of Chicago Rules Portal.
10. Press release ≠ executive order. The third-party duty is materially weaker in the signed text ("the City will require") than in the announcement ("must also conform"), and the medical-debt definition is narrower. Never cite the release for operative EO language.
11. The signed EO's § 2 list skips item 4. That is how the official document reads.
12. "Medical debt" in the EO is narrow — debt owed to the City from emergency medical response services. It is not a general medical-debt rule and says nothing about hospital paper.
13. The consolidated code was unreachable. See the currency block — post-2013 amendments to § 4-6-160 would not appear on this page.

Related

• Illinois — IDFPR licence, $25k bond, ICAA § 2.03 exemptions, SOL and revival
• New York City — the other big-city conduct code; same consumer-residence trigger
• FDCPA validation — § 1692g, which (b)(2)(A) tracks and (b)(2)(B) exceeds
• Reg F validation notice — federal content baseline
• Reg F disputes / original creditor — federal dispute handling, against which Chicago's prescribed itemization should be read
• No local layer — localities checked with no regime of their own
• State matrix