The Council of Repossession Professionals (CORP) cautioned repo agencies about the potential pitfalls of using a locksmith company that might be mandated by a particular finance company client but could utilize employees who may not be aware or comply with specific state regulations.

CORP explained through a post on the news section of its website that many states have explicit regulations when it comes to locksmiths, indicating that some jurisdictions prohibit contracting work to local locksmiths who might not be employed by a national company.

“Some states even demand that these national locksmith companies have an actual physical business in the state they are doing the service in,” said CORP officials, who represent eight national organizations including:

—American Lenders Service Co. (ALSCO)
—American Recovery Association (ARA)
—California Association of Licensed Repossessors (CALR)
—Florida Alliance of Certified Asset Recovery Specialists (FLACARS)
—Illinois Association of Repossession Agencies (IARA)
—Michigan Association of Repossession Agencies (MARA)
—Rocky Mountain Repossessors Association (RMRA)
—Time Finance Adjusters (TFA)

CORP suggested that repossession agencies ask and seek the answers to three simple questions with regard to the cutting of new keys for repossessed vehicles.

—Do locksmiths have to have a license to operate?

—What type of insurance does the state require them to have?

—Does the state require all businesses to carry worker’s compensation?

“Once you have this information, now you have a chance,” CORP said in the post that’s available here.