Which place’s debt rules apply—and who can help?

S_LA — Louisiana Provider Market Access and Consumer Fees

PASS-01 | SettleADebt.com | Research date: October 24, 2026 (Pacific)

Research scope: Louisiana debt-adjustment and debt-settlement provider classification, lawful market access, consumer fee ceilings, collection timing, exemptions, and operational verification.

Status: Partially established; market-entry approval withheld.

The most consequential finding is that Louisiana has two statutory regimes that must be reconciled before concluding a commercial debt-settlement provider may operate:

1. La. R.S. 14:331 prohibits engaging in the business of debt adjusting except for enumerated exclusions. Its definition expressly includes contracting for compensation to adjust, compromise, or discharge indebtedness—not merely holding and distributing consumer payments.
2. La. R.S. 37:2592 sets fees for a debt-adjusting licensee, including a 12% aggregate debt-based ceiling, a $25 initial-payment provision, collection limitations, cancellation charges, and a creditor-notification condition.

Both provisions appear in the Louisiana Legislature's published statutory text. Louisiana State Legislature+1

The existence of a licensing-fee provision does not by itself establish that Louisiana currently offers a valid licensing pathway to an ordinary for-profit, noncustodial debt-settlement company. The surrounding licensing statute, exemptions, regulatory authority, and operational status must be resolved.

For SettleADebt.com, the defensible interim position is:

HOLD — do not classify Louisiana as an approved fee-charging debt-settlement market based on this research.

This is a legal-research determination, not a conclusion that every debt-related service or referral activity is prohibited.

A. Substantive findings

1. Classification and statutory boundaries

S_LA-P1-C001 — Broad prohibition and definition. Louisiana R.S. 14:331(A)–(B) reaches two distinct forms of conduct: periodic-payment arrangements where the provider distributes funds among creditors, and fee-based contracts to adjust, compromise, or discharge debts. The latter wording makes it unsafe to treat noncustodial principal-reduction negotiation as automatically outside the statute. Louisiana State Legislature

The statutory text does not expressly limit the relevant indebtedness to credit cards or consumer-purpose debts. Nor does it expressly resolve the application of the provision to an out-of-state provider serving a Louisiana resident remotely. Those questions remain open for statutory-context and controlling-case analysis.

S_LA-P1-C002 — Express exclusions. Section 14:331(C) contains nine categories:

• Incidental debt adjustment in lawful Louisiana legal practice.
• Authorized banks and fiduciaries acting in their ordinary principal business.
• Title insurers and abstract companies conducting escrow business.
• Judicial officers and others acting under court orders.
• Nonprofit or charitable corporations or associations engaged in debt adjusting.
• Incidental debt adjustment in lawful CPA practice.
• Bona fide trade or mercantile associations arranging business-establishment debts.
• Employers acting for employees.
• Debtor-requested loans involving authorized disbursement of proceeds to adjust debts, without compensation for debt-adjustment services.

These are activity- and entity-dependent exclusions. For example, an attorney referral arrangement does not necessarily mean that a separate commercial settlement company is conducting debt adjustment incidentally to lawful legal practice. Likewise, a nonprofit exemption from this criminal provision does not establish exemption from every other potentially applicable law. Louisiana State Legislature

S_LA-P1-C003 — Criminal consequence. Section 14:331(D) specifies misdemeanor exposure with a fine not exceeding $500, imprisonment not exceeding six months, or both, upon conviction. The statutory text must be read with the exclusions in subsection C; it should not be represented as applying identically to every person performing any debt-related activity. Louisiana State Legislature

2. Licensing versus prohibition

S_LA-P1-C004 — A separate licensing framework exists in the published statutory text. Section 37:2592 expressly governs fees of a licensee. It is evidence that the legislature contemplated licensed debt-adjusting activity, but not conclusive evidence that every modern commercial debt-settlement business can qualify.

The unresolved reconciliation is important: the prohibition in R.S. 14:331 was added in 1972, whereas R.S. 37:2592 cites a 1970 enactment. Their enactment sequence raises a genuine question about the continuing operation and scope of the licensing provisions. Chronology alone does not answer it. Louisiana State Legislature+1

Interim model classifications

3. Louisiana fee ceilings

S_LA-P1-C005 — Aggregate contracted fee. R.S. 37:2592 allows a licensee to contract for a reasonable fee not exceeding 12% of total debts reported and listed with the licensee by the debtor and/or listed creditors.

This is not a blanket authorization for any settlement provider to charge 12% of enrolled debt. The entity must first qualify as a licensee with authority to perform the underlying service.

S_LA-P1-C006 — Initial payment. The same section states that a licensee may require an initial payment of no more than $25, which is included within—not added to—the total allowable contracted fee.

S_LA-P1-C007 — Receipt-based restriction. Apart from the initial-payment provision, the statute limits amounts taken or received for services to 12% of the amount received by the licensee at any one time from or on behalf of the debtor. This is a separate operational constraint, not merely a repetition of the aggregate 12% ceiling.

S_LA-P1-C008 — Cancellation/default. For debtor cancellation or default before successful completion, the statute describes an additional amount of 9% of remaining listed indebtedness, capped at $25; when the contract has remained in force for 90 days or longer, it specifies a $50 cancellation fee.

The exact interaction of these two sentences, other applicable cancellation rights, federal restrictions, and whether a particular fee is enforceable in a given transaction remains subject to further analysis.

S_LA-P1-C009 — Creditor notification. A licensee is not entitled to retain a fee until it has notified all creditors listed by the debtor that the debtor engaged the licensee in a debt-adjustment program.

These findings are drawn from the complete published text of R.S. 37:2592, not a historical industry fee chart. Louisiana State Legislature

No indexing formula, adjustment notice, or current administratively adjusted replacement amount has been verified for these statutory figures. The displayed dollar amounts are therefore verified as the published statutory amounts, not independently certified as the complete operative 2026 fee schedule.

4. Federal fee timing — separate from Louisiana permission

S_LA-P1-C010 — TSR performance triggers. Where the federal Telemarketing Sales Rule applies, 16 C.F.R. §310.4(a)(5)(i) prohibits requesting or receiving a debt-relief fee until the provider has obtained a qualifying agreement altering at least one debt and the customer has made at least one payment pursuant to that agreement.

For debts altered individually, the fee must follow either a consistent proportional allocation of the total fee by enrolled debt balance or a consistent percentage-of-savings methodology. LII / Legal Information Institute

S_LA-P1-C011 — Dedicated accounts. Section 310.4(a)(5)(ii) provides a conditional account-funding arrangement, including insured-institution, ownership, independence, interest, withdrawal, and return-of-funds requirements. It does not create a Louisiana provider license or authorize unearned fee withdrawals.

S_LA-P1-C012 — Credit-repair overlap. The same federal provision, §310.4(a)(2), imposes a separate timing restriction for covered telemarketed services represented as improving credit records or ratings. Debt-relief and credit-repair representations cannot automatically be treated as interchangeable. Federal Credit Repair Organizations Act applicability and Louisiana credit-repair regulation require separate analysis. LII / Legal Information Institute

A federal compliance pathway is never a substitute for Louisiana authorization.

5. Current licensing and regulator verification

An additional official statutory source materially narrows the licensing question.

S_LA-P1-C013 — Licenseable activity under Title 37. R.S. 37:2582 defines financial planning and management service around managing an individual's financial affairs and distributing money to creditors, or acting as the individual's agent in distributing income to creditors, regardless of whether a fee is charged.

That is narrower in important respects than the express settlement-and-compromise language in R.S. 14:331. A provider negotiating settlements without distributing income cannot simply assume it qualifies under the Title 37 licensing definition. Louisiana State Legislature

S_LA-P1-C014 — Licensing qualifications. R.S. 37:2585 describes an application, bond approval, payment of specified fees, investigation of fitness and financial responsibility, and license issuance by a director. The section cites an amendment in Acts 2024, No. 644, §1. It also describes licenses expiring on the following January 1 unless renewed. Louisiana State Legislature

Critical currentness limitation: Louisiana's own law-search page states that Title 37 had not been included among the Revised Statute titles updated through the 2026 Regular Legislative Session as of its October 15, 2026 update. Title 14 was included. The legislature also warns that its online text is informational and not authoritative. Accordingly, the Title 37 text cannot be certified as fully updated through October 24, 2026 from this source alone. Louisiana State Legislature

The presently identified licensing title refers to a director of the Division of Occupational Standards. No independently verified, currently operating application portal, issuing-office succession record, debt-adjuster license registry, or actual licensee record was obtained.

S_LA-P1-C015 — Public permission remains unverified. The statutory application and qualification language is meaningful, but a modern working license issuance process has not been demonstrated. The Louisiana Office of Debt Recovery materials encountered in this research concern collection of government debts, not licensing commercial consumer debt-settlement providers. Office of Debt Recovery+1

6. Worked examples

All examples below are conditional statutory calculations or federal timing illustrations, not approved Louisiana commercial settlement scenarios. Dollar amounts are rounded to cents using ordinary half-up rounding. No hypothetical provider is presumed licensed.

Example LA-E01 — Aggregate Title 37 fee ceiling

• Listed debts: $8,000 + $12,000 = $20,000.
• Statutory percentage: 12%.
• Calculation: $20,000 × 0.12 = $2,400.
• Hypothetical $25 initial payment, if otherwise lawfully collectable, is included in $2,400.
• Remaining contractual ceiling after that payment: $2,375.

Limit: This is a maximum arithmetic ceiling, not a finding that the entire amount is earned, currently collectible, or lawful for an ordinary settlement company.

Example LA-E02 — Receipt-based restriction

• Amount received by a hypothetical qualifying licensee for a debtor: $400.
• 12% of receipt: $48.
• Separate total contracted-fee ceiling: assume $2,400.
• Maximum under the receipt-based percentage alone: $48.

Limit: Any fee also depends on the creditor-notification condition, applicable federal timing, the agreement, and lawful provider status. The $48 calculation does not establish an earned fee.

Example LA-E03 — Early cancellation calculation

• Remaining listed indebtedness: $1,000.
• 9% calculation: $90.
• Statutory short-duration cap: $25.
• Result under the first cancellation sentence: $25.

For a $100 remaining balance, 9% is $9, below the $25 ceiling.

If the agreement has remained in force for at least 90 days, the second sentence specifies $50. Whether that amount is enforceable under all applicable law is held.

Example LA-E04 — Federal proportional allocation

Assume a federally covered debt-relief arrangement, solely to illustrate the TSR:

• Debt A enrolled: $4,000.
• Debt B enrolled: $6,000.
• Total enrolled: $10,000.
• Hypothetical contracted total fee: $1,000.
• Debt A's proportional allocation: $1,000 × ($4,000 / $10,000) = $400.
• Debt B's proportional allocation: $1,000 × ($6,000 / $10,000) = $600.

Suppose Debt A is settled for $2,500 and the consumer has made the required first payment. The federal performance conditions for collecting Debt A's allocated $400 may then be satisfied, assuming all other TSR conditions.

Debt B's $600 is not earned merely because Debt A has settled. If Debt B has no qualifying alteration and payment, its fee remains uncollectible under this method.

Louisiana qualification: This calculation does not establish state authorization, compliance with R.S. 37:2592, or lawful retention.

Example LA-E05 — Federal savings method

• Debt A enrolled: $4,000.
• Debt A fully satisfied for: $2,500.
• Savings: $1,500.
• Uniform hypothetical fee rate: 20% of savings.
• Calculation: $1,500 × 0.20 = $300.

If the qualifying agreement and payment triggers have occurred, $300 is the amount produced by this hypothetical federal allocation method. A second debt must use the same savings percentage; it cannot switch to an enrolled-balance percentage opportunistically.

Limit: No Louisiana authorization or state fee compatibility is inferred.

Example LA-E06 — Prior earnings and cancellation

Use the same enrolled balances and $1,000 contracted total fee from LA-E04. Suppose Debt A's $400 was actually earned under the stated proportional method and all applicable conditions, while Debt B remains unsettled.

• Previously earned amount: $400.
• Previously earned amount attributable to Debt B: $0.
• Unearned allocated balance: $600.
• Consumer cancels.

Under the federal performance rule, cancellation does not automatically make the remaining $600 earned. Any additional Louisiana cancellation charge requires an independently valid provider status, qualifying contract, and applicable legal basis.

This example is internally consistent with LA-E04; it does not assume a fee earned from a partial or unrelated payment.

7. Remaining investigation boundaries

No finding in this pass establishes that a settlement involving secured debt, government debt, medical debt, commercial debt, or a Louisiana judgment is permissible or impermissible on account of that debt category alone. Those classifications require their respective later investigations.

Likewise, the existence of a federally approved bankruptcy credit-counseling agency in Louisiana does not demonstrate authorization to operate a commercial debt-settlement business under Louisiana law. The Department of Justice list is a different approval framework. United States Department of Justice

B. Source register

Access/check date for the entries below: October 24, 2026. The date records this research session, not a certification that every source was updated on that date.

The 2004 document's proposed fee and refund language is deliberately excluded from operative conclusions. No evidence in this pass establishes that it was enacted in the form retrieved. Legis Louisiana

C. Claim register

Additional interpretation hold: The Title 37 fee ceiling and receipt limitation cannot be assumed to apply to a noncustodial settlement provider unless that provider falls within the licensing chapter and can lawfully operate. This follows from C001, C004 and C013, but its definitive resolution requires further statutory and case-law research.

D. Component coverage and gap register

Highest-priority next investigations

1. Resolve R.S. 14:331 against Title 37, Chapter 33. Read every operative section of R.S. 37:2581–2600, the 1970 and 1972 enactments, subsequent amendments, and controlling interpretations. Determine whether the license regime survives for specified conduct and whether it provides an exception to the criminal prohibition.
2. Establish actual 2026 licensing operations. Identify the legally responsible successor to the Division of Occupational Standards, any current administrative rules, valid application forms, bond requirements, renewal procedure and public registry. A historical statutory application provision alone is insufficient.
3. Determine the lawful fee and timing matrix by business model. Separate nonprofit, attorney, custodial licensed financial-management, noncustodial settlement and education-only activities. Reconcile state ceilings with the TSR and any other applicable federal or state fee restrictions before approving example pricing or collections.

E. Researcher self-check

Actually read: Complete opened Louisiana Legislature pages for R.S. 14:331 and R.S. 37:2592; substantive official search-rendered text

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Coordinator provenance: the following is the separately saved missing-tail continuation, not a single response.

E. Researcher self-check — continuation

Actually read: Complete opened Louisiana Legislature pages for R.S. 14:331 and R.S. 37:2592; substantive official search-rendered text for R.S. 37:2582 and R.S. 37:2585, subject to the limitations below; and the reproduced operative wording of 16 C.F.R. §310.4(a)(2) and (a)(5) through the Cornell Legal Information Institute rendering.

The official eCFR locator for §310.4 was identified, but the direct eCFR page was not opened and read in this pass. The federal conclusions were therefore limited to the wording reproduced through the identified secondary rendering and were not described as a fresh direct-page eCFR verification.

Read only through search-rendered or limited official results:

• The Louisiana Legislature’s October 15, 2026 law-search update notice was read through the official search response. The full update page was not separately opened and examined beyond that rendered material.
• R.S. 37:2582 and R.S. 37:2585 were examined through official search-rendered statutory excerpts. Their complete operative pages and surrounding provisions were not opened and read.
• Louisiana Office of Debt Recovery descriptions and laws-and-regulations material were inspected through official search-rendered results. Those materials were used only to distinguish government-debt collection from commercial debt-adjuster licensing; they did not establish provider permission.
• The U.S. Trustee Program’s Louisiana credit-counseling listing was inspected only for its separate federal bankruptcy-related scope. It was not used as Louisiana market-access evidence.
• The Title 37 table of contents was used as a locator for R.S. 37:2581–2600. It was discovery material, not a substitute for reading the individual provisions.
• The 2004 Louisiana legislative document was treated as historical or proposed discovery material only. Its full legislative history, final disposition, and relationship to enacted law were not established.

A search-rendered excerpt, title, table of contents, homepage, or agency description was not treated as complete verification of current operative law. Where the full provision was not opened, the limitation remains.

Not read or not established in this pass:

• The complete text of every section in R.S. 37:2581–2600, including all provisions governing applications, bonds, issuance, renewals, supervision, records, enforcement, exemptions, and remedies.
• The session laws and complete amendment history necessary to reconcile the 1970 Title 37 licensing chapter with the 1972 enactment of R.S. 14:331.
• Any complete, current Louisiana Administrative Code chapter governing debt adjusters, financial planning and management services, debt-management providers, or modern debt-settlement providers.
• Any adoption order, repeal order, transfer order, reorganization instrument, attorney-general opinion, agency declaratory ruling, or formal interpretive bulletin resolving the present regulator or the relationship between the two statutory regimes.
• A current official debt-adjuster application package, fee schedule, bond form, renewal instruction, licensing portal, public lookup tool, or licensee roster.
• A primary registry record establishing that any named provider currently holds Louisiana authority.
• Controlling Louisiana appellate or federal decisions interpreting R.S. 14:331, R.S. 37:2581–2600, their interaction, remote-provider nexus, noncustodial settlement activity, or the listed exemptions.
• Full Louisiana credit-repair statutes or regulations, federal CROA authorities, or decisions addressing overlap created by credit-improvement representations.
• Any current indexing notice, administrative adjustment, replacement fee schedule, or official confirmation that the dollar and percentage amounts displayed in R.S. 37:2592 remain the complete operative 2026 amounts.
• Any provider agreement, consumer file, payment ledger, trust-account record, creditor notice, settlement document, or other transaction-specific evidence.
• Any model act, model-act commentary, association chart, company compliance chart, or commercial fifty-state survey as operative Louisiana authority.

Supplied, reused, and foundation-material limits: No earlier foundation state cell was accepted as verified Louisiana evidence. Such material, if encountered as a lead, did not replace fresh Louisiana authority. No user-supplied Louisiana legal conclusion was adopted as proof. No source was silently treated as read because another state investigation had discussed a similar statute, fee structure, model act, or federal rule.

Currentness limits: The research access date was October 24, 2026 Pacific. That date records when the material was accessed; it is not the effective date of the law and does not independently prove statutory currency. The Legislature’s own update notice supported stronger currentness treatment for Title 14 than for Title 37. Because Title 37 was not shown on the identified list of titles updated through the 2026 Regular Legislative Session, the Title 37 findings remain subject to an express currentness hold.

The Legislature’s online text was also presented with an informational/non-authoritative limitation. No certified code publication, session-law reconciliation, or other authoritative current-text compilation was obtained in this pass.

Permission limits: The investigation established statutory text referring to a licensee and an application process, but it did not establish that an ordinary commercial, for-profit debt-settlement provider currently has an available and valid licensing route. It also did not establish that a noncustodial provider fits the Title 37 licensing definition or escapes R.S. 14:331.

Absence of a verified application portal or registry is not proof that no license can be issued. Conversely, historical licensing language is not proof that a current license is available. Louisiana market access therefore remains held.

No attorney, nonprofit, bank, fiduciary, CPA, trade association, employer, loan provider, affiliate, referral company, or separate service entity was found to qualify for an exclusion merely by label or association. Each exclusion remains dependent on its statutory elements and the provider’s actual conduct.

Fee limits: The 12% aggregate ceiling, $25 initial-payment language, receipt-based 12% restriction, cancellation figures, and creditor-notification condition were taken from the displayed text of R.S. 37:2592. They remain conditional on lawful licensee status, coverage of the activity, complete currentness verification, and any other applicable state or federal law.

No fee amount was approved for SettleADebt.com or any named provider. No ceiling was treated as permission to collect in advance. No cancellation charge was found universally enforceable. No indexing or inflation adjustment was calculated. No historical table or proposed bill was used to replace the displayed statutory amounts.

Federal limits: The TSR discussion was included only as conditional common context. It did not establish that every Louisiana interaction is telemarketing, that every provider is covered, or that satisfying the TSR creates Louisiana permission. Credit-repair timing under §310.4(a)(2) was kept distinct from debt-relief timing under §310.4(a)(5). CROA coverage was not resolved.

Court and interpretation limits: No controlling judicial decision was read. Accordingly, the treatment of modern settlement negotiation, custodial versus noncustodial models, mixed services, territorial reach, consumer-versus-business purpose, statutory conflict, implied repeal, harmonization, prosecutorial application, and exemption boundaries remains unresolved. The PASS-01 classification conclusions are therefore text-based risk findings, not adjudicated holdings.

Operational limits: No application was filed; no regulator, provider, creditor, consumer, attorney, nonprofit, or other person was contacted. No CAPTCHA or access restriction was bypassed. No account, permission, website, registry, filing, or public record was changed. No Chrome control, browser-tab access, Work mode, Deep Research, API, private borrower data, or other Chat was used for this continuation.

No local file was created or written. No publication, implementation, compliance approval, legal opinion, provider authorization, state acceptance, or A066 acceptance is claimed.

This continuation adds no new substantive Louisiana finding. It preserves every permission, currentness, fee, court, regulatory, registry, and operational gap identified in the saved first segment.

END S_LA PASS-01

END S_LA PASS-01-CONTINUATION-01