June 03, 2020
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CS/HB 311

1
A bill to be entitled
2An act relating to debt relief services; providing a
3directive to the Division of Statutory Revision; creating
4s. 559.101, F.S.; providing a short title; transferring,
5renumbering, and amending s. 817.801, F.S.; revising
6definitions relating to debt relief services; creating s.
7559.103, F.S.; providing the powers of the Office of
8Financial Regulation; creating s. 559.104, F.S.;
9authorizing the Financial Services Commission to adopt
10rules; transferring, renumbering, and amending s. 817.803,
11F.S.; revising provisions relating to who is not subject
12to the Debt Relief Services Act; providing an exception
13for attorneys representing clients; creating s. 559.106,
14F.S.; requiring debt relief organizations to be registered
15with the office; providing a registration fee; requiring
16background screening of applicants and control persons;
17providing grounds for registration issuance or denial;
18requiring annual renewal; creating s. 559.107, F.S.;
19requiring registration renewal; transferring, renumbering,
20and amending s. 817.804, F.S.; requiring a debt relief
21organization to obtain a surety bond and to provide proof
22of such bond to the office; creating s. 559.109, F.S.;
23requiring a debt relief organization to maintain records;
24creating s. 559.111, F.S.; requiring a debt relief
25organization to prepare a financial analysis for the
26debtor; providing for service contracts; requiring certain
27provisions to be included in such contracts; requiring the
28debt relief organization to provide the debtor with copies
29of all signed documents; transferring, renumbering, and
30amending s. 817.805, F.S.; conforming terms to changes
31made by the act; transferring, renumbering, and amending
32s. 817.802, F.S.; prohibiting a debt relief organization
33from engaging in certain additional specified acts;
34deleting a provision that allows the organization to
35collect a fee for insufficient fund transactions; creating
36s. 559.114, F.S.; providing for debtor complaints to the
37office; providing procedures and office duties, including
38administrative penalties; creating s. 559.115, F.S.;
39providing for the issuance of subpoenas by the office;
40creating s. 559.116, F.S.; authorizing the office to issue
41cease and desist orders; transferring, renumbering, and
42amending s. 817.806, F.S.; conforming terms to changes
43made by the act; providing administrative penalties;
44specifying violations that result in criminal penalties;
45repealing ss. 559.10, 559.11, 559.12, and 559.13, F.S.,
46relating to obsolete provisions concerning budget
47planning; amending s. 516.07, F.S.; conforming a cross-
48reference; providing effective dates.
49
50Be It Enacted by the Legislature of the State of Florida:
51
52     Section 1.  The Division of Statutory Revision is directed
53to redesignate the title of part II of chapter 559, Florida
54Statutes, consisting of ss. 559.101-559.117, as "Debt Relief
55Services."
56     Section 2.  Section 559.101, Florida Statutes, is created
57to read:
58     559.101  Short title.-This part may be cited as the "Debt
59Relief Services Act."
60     Section 3.  Section 817.801, Florida Statutes, is
61transferred, renumbered as 559.102, Florida Statutes, and
62amended to read:
63     559.102 817.801  Definitions.-As used in this part:
64     (1)  "Commission" means the Financial Services Commission.
65     (2)  "Control person" means an individual, partnership,
66corporation, trust, or other organization that possesses the
67power, directly or indirectly, to direct the management or
68policies of a company, whether through ownership of securities,
69by contract, or otherwise. The term includes, but is not limited
70to:
71     (a)  A company's executive officers, including the
72president, chief executive officer, chief financial officer,
73chief operations officer, chief legal officer, chief compliance
74officer, director, or other individuals having similar status or
75functions.
76     (b)  For a corporation, each shareholder who, directly or
77indirectly, owns 10 percent or more, or who has the power to
78vote 10 percent or more, of a class of voting securities, unless
79the applicant is a publicly traded company.
80     (c)  For a partnership, all general partners and limited or
81special partners who have contributed 10 percent or more, or who
82have the right to receive upon dissolution 10 percent or more,
83of the partnership's capital.
84     (d)  For a trust, each trustee.
85     (e)  For a limited liability company, all managing members
86and those members who have contributed 10 percent or more, or
87who have the right to receive upon dissolution 10 percent or
88more, of the partnership's capital.
89     (3)(2)  "Credit counseling services" means confidential
90money management, debt reduction, financial analysis, and
91financial educational services provided to a debtor. The term
92does not include foreclosure-related rescue services.
93     (4)(3)  "Creditor contribution" means any sum that a
94creditor agrees to contribute to a debt relief organization
95credit counseling agency, whether directly or by setoff against
96amounts otherwise payable to the creditor on behalf of debtors.
97     (5)(4)  "Debt management services" means services, other
98than foreclosure-related rescue services, provided to a debtor
99by a debt relief credit counseling organization for a fee to:
100     (a)  Effect the adjustment, compromise, interest rate
101reduction, modification of terms, negotiation, or discharge of
102any unsecured account, note, or other indebtedness of the
103debtor; or
104     (b)  Receive funds periodically from the debtor and
105disburse to a creditor any money or other thing of value with
106the expectation that the debtor will repay the creditor the
107entire principal owed.
108     (6)(1)  "Debt relief organization Credit counseling agency"
109means a person offering to provide or any organization providing
110debt management services, debt settlement services, or credit
111counseling services for compensation.
112     (7)  "Debt settlement services" means services, other than
113foreclosure-related rescue services, provided to a debtor with
114the expectation of obtaining the creditor's agreement to accept
115less than the principal amount of a debt in full satisfaction of
116the debt.
117     (8)  "Debtor" means an individual who obtains credit, seeks
118a credit agreement with a creditor, or owes money to a creditor.
119     (9)  "Enrolled debt" means the amount of debt at the time
120the contract for debt management services is entered but does
121not include any increases in the amount of debt or additional
122fees or penalties applied to the debt after services included in
123the contract are initiated.
124     (10)  "Financial analysis" means the review of an
125individual's budget, income, expenses, and debt by the debt
126relief organization in order to determine the individual's
127suitability for additional credit counseling, debt management,
128or debt settlement services provided by the organization.
129     (11)  "Financial audit report" means a report prepared in
130connection with a financial audit that is conducted in
131accordance with generally accepted auditing standards prescribed
132by the American Institute of Certified Public Accountants by a
133certified public accountant licensed to do business in the
134United States, which includes:
135     (a)  Financial statements, including notes related to the
136financial statements and required supplementary information,
137prepared in conformity with United States generally accepted
138accounting principles.
139     (b)  An expression of opinion whether the financial
140statements are presented in conformity with United States
141generally accepted accounting principles, or an assertion that
142such an opinion cannot be expressed and the reasons for such
143assertion.
144     (12)  "Office" means the Office of Financial Regulation of
145the Financial Services Commission.
146     (13)(5)  "Person" has the same meaning as in s. 1.01 means
147any individual, corporation, partnership, trust, association, or
148other legal entity.
149     (14)  "Service contract" means the agreement for services
150between a debt relief organization and a debtor.
151     Section 4.  Section 559.103, Florida Statutes, is created
152to read:
153     559.103  Powers and duties of the Office of Financial
154Regulation; fees.-
155     (1)  The office is responsible for the administration and
156enforcement of this part.
157     (2)  The office may conduct an investigation of any person
158if the office has reason to believe, upon complaint or
159otherwise, that any violation of this part may have been
160committed or is about to be committed.
161     (3)  All fees, charges, and fines collected pursuant to
162this part shall be deposited in the State Treasury to the credit
163of the Regulatory Trust Fund under the office.
164     Section 5.  Section 559.104, Florida Statutes, is created
165to read:
166     559.104  Rules.-The commission may adopt rules to
167administer this part, including rules that:
168     (1)  Require electronic submission of any forms, documents,
169or fees required under this part.
170     (2)  Establish time periods during which an applicant for
171registration is barred from registration or a registered debt
172relief organization is barred from renewal due to prior criminal
173convictions of, or guilty or nolo contendere pleas by, any of
174the applicant's or registrant's control persons, regardless of
175adjudication.
176     (a)  The rules must provide:
177     1.  Permanent bars for felonies involving money laundering,
178breach of trust, dishonesty, embezzlement, fraud, fraudulent
179conversion, misappropriation of property, racketeering, or
180theft;
181     2.  A 15-year disqualifying period for felonies involving
182moral turpitude;
183     3.  A 7-year disqualifying period for all other felonies;
184and
185     4.  A 5-year disqualifying period for misdemeanors
186involving fraud, dishonesty, or any other act of moral
187turpitude.
188     (b)  The rules may provide for an additional waiting period
189due to dates of imprisonment or community supervision, the
190commitment of multiple crimes, and other factors reasonably
191related to the applicant's criminal history.
192     (c)  The rules may provide for mitigating factors for
193crimes identified in subparagraph (a)2. However, the mitigation
194may not result in a period of disqualification less than 7
195years. The rule may not mitigate the disqualifying periods in
196subparagraphs (a)1., (a)3., and (a)4.
197     (d)  An applicant is not eligible for registration until
198the expiration of the disqualifying period set by rule.
199     (e)  Section 112.011 is not applicable to eligibility for
200registration under this part.
201     Section 6.  Section 817.803, Florida Statutes, is
202transferred, renumbered as section 559.105, Florida Statutes,
203and amended to read:
204     559.105 817.803  Exceptions.-Nothing in This part does not
205apply applies to:
206     (1)  A person licensed to practice law in this state who is
207providing credit counseling, debt management, or debt settlement
208services as an ancillary matter to her or his representation of
209the debtor as a client. Any Debt management or credit counseling
210services provided in the practice of law in this state;
211     (2)  A Any person who engages in credit counseling, debt
212management, or debt settlement services adjustment to adjust the
213indebtedness owed to such person.; or
214     (3)  The following entities or their subsidiaries:
215     (a)  The Federal National Mortgage Association;
216     (b)  The Federal Home Loan Mortgage Corporation;
217     (c)  The Florida Housing Finance Corporation, a public
218corporation created in s. 420.504;
219     (d)  Any financial institution as defined under s.
220655.005(1)(h) A bank, bank holding company, trust company,
221savings and loan association, credit union, credit card bank, or
222savings bank that is regulated and supervised by the Office of
223the Comptroller of the Currency, the Office of Thrift
224Supervision, the Federal Reserve, the Federal Deposit Insurance
225Corporation, the National Credit Union Administration, the
226Office of Financial Regulation of the Department of Financial
227Services, or any state banking regulator; or
228     (e)  A consumer reporting agency as defined in the Federal
229Fair Credit Reporting Act, 15 U.S.C. s. 1681a ss. 1681-1681y, as
230it existed on April 5, 2004; or
231     (f)  Any subsidiary or affiliate of a bank holding company,
232its employees and its exclusive agents acting under written
233agreement.
234     Section 7.  Section 559.106, Florida Statutes, is created
235to read:
236     559.106  Registration of debt relief organization.-
237     (1)  Effective April 1, 2011, each person who acts as a
238debt relief organization in this state must be registered in
239accordance with this section. This applies to debt relief
240organizations operating in this state or from another state,
241regardless of whether such organization is registered, licensed,
242or the equivalent in accordance with the laws of another state.
243     (2)  In order to apply for registration, an applicant must
244submit:
245     (a)  A completed registration application form as
246prescribed by commission rule which includes the name and
247principal business address and e-mail address of the debt relief
248organization.
249     (b)  A registration fee of $1,000. The registration fee is
250nonrefundable and may not be prorated for a partial year of
251registration.
252     (c)  Fingerprints for the applicant and each of the
253applicant's control persons in accordance with rules adopted by
254the commission.
255     1.  The fingerprints may be submitted to the office or a
256vendor acting on behalf of the office.
257     2.  The office may contract with a third-party vendor to
258provide live-scan fingerprinting in lieu of a paper fingerprint
259card.
260     3.  A state criminal history background check must be
261conducted through the Department of Law Enforcement, and a
262federal criminal history background check must be conducted
263through the Federal Bureau of Investigation.
264     4.  All fingerprints submitted to the Department of Law
265Enforcement must be submitted electronically and entered into
266the statewide automated fingerprint identification system
267established in s. 943.05(2)(b) and available for use in
268accordance with s. 943.05(2)(g) and (h). The office shall pay an
269annual fee to the department to participate in the system and
270inform the department of any person whose fingerprints are no
271longer required to be retained.
272     5.  The costs of fingerprint processing, including the cost
273of retaining the fingerprints, shall be borne by the person
274subject to the background check.
275     6.  The office is responsible for reviewing the results of
276the state and federal criminal history checks and determining
277whether the applicant meets registration requirements.
278     (d)  Submit documentation demonstrating that the surety
279bond requirements specified in s. 559.108 have been satisfied.
280     (e)  Submit additional information or documentation
281requested by the office and required by rule concerning the
282applicant or a control person of the applicant. Additional
283information may include documentation of pending and prior
284disciplinary and criminal history events, including arrest
285reports and certified copies of charging documents, plea
286agreements, judgments and sentencing documents, documents
287relating to pretrial intervention, orders terminating probation
288or supervised release, final administrative agency orders, or
289other comparable documents that may provide the office with the
290appropriate information to determine eligibility for
291registration.
292     (3)  An application is considered received for the purposes
293of s. 120.60 upon the office's receipt of the completed
294application form, all required documentation, criminal history
295information, the application fee, and all applicable
296fingerprinting processing fees.
297     (4)  The office shall issue a debt relief organization
298registration to each applicant who is not otherwise ineligible
299and who meets the requirements of this section. However, it is a
300ground for denial of registration if the applicant or one of the
301applicant's control persons:
302     (a)  Has been found guilty of, regardless of adjudication,
303or has entered a plea of nolo contendere or guilty to, any
304felony, any crime involving racketeering, fraud, theft,
305embezzlement, fraudulent conversion, breach of trust,
306misappropriation of property, dishonesty, or moral turpitude;
307     (b)  Has committed any violation specified in s. 559.113;
308     (c)  Is the subject of a pending felony criminal
309prosecution or a prosecution or an administrative enforcement
310action, in any jurisdiction, which involves fraud, racketeering,
311embezzlement, fraudulent conversion, misappropriation of
312property, theft, dishonesty, breach of trust, or any other act
313of moral turpitude;
314     (d)  Pays the office any fee, fine, or other amount with a
315check or electronic transmission of funds which fails to clear
316the applicant's financial institution;
317     (e)  Makes a material misstatement on any application,
318document, or record required to be submitted under this part or
319the rules of the commission; or
320     (f)  Has been the subject of any decision, finding,
321injunction, suspension, prohibition, revocation, denial,
322judgment, or other adverse action by any state or federal
323agency.
324     (5)  A registration issued under this section expires
325annually on March 31, unless canceled, suspended, revoked, or
326otherwise terminated, and must be renewed as provided under s.
327559.107.
328     Section 8.  Effective April 1, 2011, section 559.107,
329Florida Statutes, is created to read:
330     559.107  Registration renewal.-
331     (1)  In order to renew a debt relief organization
332registration, a debt relief organization must submit:
333     (a)  A completed registration renewal form as prescribed by
334commission rule.
335     (b)  Fingerprints, in accordance with s. 559.106, for any
336new control persons who have not been screened.
337     (c)  Any additional information or documentation requested
338by the office and required by rule concerning the registrant or
339control person of the registrant. Additional information may
340include documentation of any pending and prior disciplinary and
341criminal history events, including arrest reports and certified
342copies of charging documents, plea agreements, judgments and
343sentencing documents, documents relating to pretrial
344intervention, orders terminating probation or supervised
345release, final administrative agency orders, or other comparable
346documents that may provide the office with the appropriate
347information to determine eligibility for renewal of
348registration.
349     (d)  A nonrefundable renewal fee of $750 and nonrefundable
350fees to cover the cost of further fingerprint processing and
351retention as set forth in commission rule.
352     (2)  The office may not renew a debt relief organization
353registration unless the registrant continues to meet the minimum
354requirements for initial registration pursuant to s. 559.106 and
355adopted rule.
356     Section 9.  Section 817.804, Florida Statutes, is
357transferred, renumbered as section 559.108, Florida Statutes,
358and amended to read:
359     559.108 817.804  Financial requirements; surety bond;
360disclosure and financial reporting.-
361     (1)  A debt relief organization must Any person engaged in
362debt management services or credit counseling services shall:
363     (a)  Obtain from a licensed certified public accountant an
364annual independent financial audit report in accordance with
365generally accepted auditing standards that
366include all accounts of such person in which the funds of
367debtors are deposited and from which payments are made to
368creditors on behalf of debtors. A debt relief organization must
369submit a copy of the report to the office within 120 days after
370the end of the registrant's fiscal year. The commission may
371establish by rule the manner for filing a financial audit
372report.
373     (b)  Obtain and maintain at all times insurance coverage
374for employee dishonesty, depositor's forgery, and computer
375fraud. The insurance coverage must be in an amount not less than
376the greater of $100,000 or 10 percent of the monthly average of
377the aggregate amount of all deposits made by debtors to the
378organization for distribution to creditors with such person by
379all debtors for the 6 months immediately preceding the date of
380initial application for or renewal of the insurance. The
381deductible on such coverage may shall not exceed 10 percent of
382the face amount of the policy coverage.
383     (c)  Obtain and maintain a surety bond from a surety
384company authorized to do business in this state. The amount and
385form of the bond shall be specified by rule and must be at least
386$100,000 but may not exceed $1 million. The rule must provide
387allowances for business volume. The bond shall be in favor of
388the state for the use and benefit of any debtor who suffers or
389sustains any loss or damage by reason of any violation of this
390part. Pursuant to initial registration and renewal, each
391applicant shall furnish to the office:
392     1.  The original executed surety bond issued by a surety
393company authorized to do business in this state.
394     2.  A statement from the surety company that the premium
395for the bond has been paid in full by the applicant.
396     3.  A statement from the surety company that the bond
397issued by the surety company meets the requirements of this
398part. The liability of the surety company under any bond issued
399pursuant to this section may not, in the aggregate, exceed the
400amount of the bond regardless of the number or amount of any
401claims filed or which might be asserted against the surety on
402such bond. If multiple claims are filed which collectively
403exceed the amount of the bond, the surety may pay the full
404amount of the bond to the office and is not further liable under
405the bond. The office shall hold such funds for distribution to
406claimants and administratively determine and pay to each
407claimant a pro rata share of each valid claim made within 6
408months after the date the first claim is filed against the
409surety.
410     (2)  A copy of the annual financial audit report and
411insurance policies required by this section must shall be
412available for public inspection at each branch location of the
413organization. Copies shall be provided, upon written request, to
414any party requesting a copy for a charge that does not to exceed
415the cost of copying the reproduction of documents.
416     Section 10.  Section 559.109, Florida Statutes, is created
417to read:
418     559.109  Maintenance of records.-
419     (1)  Each registered debt relief organization shall
420maintain, at the principal place of business designated on the
421registration, all books, accounts, records, and documents
422necessary to determine the registrant's compliance with this
423part.
424     (2)  The office may authorize the maintenance of records at
425a location other than a principal place of business. The office
426may require books, accounts, and records to be produced and
427available at a reasonable and convenient location in this state.
428     (3)  The commission may prescribe by rule the minimum
429information to be shown in the books, accounts, records, and
430documents of registrants so that such records enable the office
431to determine the registrant's compliance with this part.
432     (4)  All books, accounts, records, documents, and receipts
433of any payment transaction must be preserved and kept available
434for inspection by the office for at least 5 years after the date
435the transaction is completed. The commission may prescribe by
436rule requirements for the destruction of books, accounts,
437records, and documents retained by the registrant after the
438completion of the required 5-year period.
439     Section 11.  Section 559.111, Florida Statutes, is created
440to read:
441     559.111  Financial analysis; service contracts.-
442     (1)  Before a debtor signs a service contract, the debt
443relief organization shall prepare, retain a copy of, and provide
444to the debtor a written financial analysis specific to the
445debtor which includes an evaluation of the debtor's income,
446expenses, and all debts. An additional fee may not be charged
447for the financial analysis.
448     (2)  Based on the completed financial analysis, the debt
449relief organization shall provide to the debtor, and retain a
450copy of, a written determination of the debtor's suitability for
451debt management or debt settlement services and whether the
452debtor can reasonably meet the requirements of the service
453contract, including the debtor's ability to save the amount
454estimated to be needed to fund the settlement of the debt.
455     (3)  The service contract between the debt relief
456organization and the debtor must be signed and dated by the
457debtor and include all of the following:
458     (a)  The following statement in at least 12-point uppercase
459type at the top of the service contract:
460
461IMPORTANT:  IT IS RECOMMENDED THAT YOU CONTACT YOUR
462CREDITORS BEFORE SIGNING THIS CONTRACT. YOUR CREDITORS
463MAY BE WILLING TO DIRECTLY NEGOTIATE A SETTLEMENT,
464INTEREST RATE REDUCTION, MODIFICATION, PAYMENT PLAN,
465OR RESTRUCTURING OF YOUR DEBT FREE OF CHARGE.
466
467YOUR USE OF DEBT MANAGEMENT OR DEBT SETTLEMENT
468SERVICES MAY RESULT IN LATE FEES, ADDITIONAL DEBTS,
469AND AN ADVERSE CREDIT RATING. YOU SHOULD CONTACT YOUR
470CREDITOR FOR MORE INFORMATION.
471
472     (b)  A full and detailed description of the services to be
473performed by the debt relief organization for the debtor,
474including the financial analysis determining the suitability of
475the debtor for debt management or debt settlement services, all
476guarantees and all promises of full or partial refunds, the
477estimated date or length of time by which the services are to be
478performed, and a copy of the Florida Debt Relief Services Act.
479     (c)  All terms and conditions of payment, including the
480anticipated total of all payments to be made by the debtor and
481the estimated amount of any payments to be made to the debt
482relief organization or to any other person.
483     (d)  The debt relief organization's principal business
484address and the name and address of its agent in the state
485authorized to receive service of process.
486     (e)  A clear and conspicuous statement in boldface type, in
487immediate proximity to the space reserved for the debtor's
488signature, which states: "You, the debtor, may cancel this
489service contract at any time before midnight of the 5th business
490day after the date of signing this contract. (See the attached
491notice of right to cancel for further explanation of this
492right.)"
493     (f)  A notice of right to cancel attached to the contract,
494in duplicate and easily detachable, which contains the following
495statement in at least 12-point uppercase type:
496
497
NOTICE OF RIGHT TO CANCEL
498
499YOU MAY CANCEL ANY CONTRACT FOR CREDIT COUNSELING,
500DEBT MANAGEMENT, OR DEBT SETTLEMENT SERVICES WITHIN 5
501BUSINESS DAYS AFTER THE DATE THE CONTRACT IS SIGNED BY
502YOU WITHOUT INCURRING ANY PENALTY OR OBLIGATION.
503
504YOUR PAYMENT MUST BE RETURNED TO YOU WITHIN 10
505BUSINESS DAYS AFTER RECEIPT OF YOUR CANCELLATION
506NOTICE.
507
508TO CANCEL THIS CONTRACT, YOU MUST MAIL OR DELIVER A
509SIGNED AND DATED COPY OF THIS CANCELLATION NOTICE OR
510ANY OTHER WRITTEN NOTICE CLEARLY INDICATING YOUR
511DESIRE TO CANCEL YOUR CONTRACT.
512
513     TO:  ...(name of debt relief organization)...
514     AT:  ...(address)...
515
516BY SIGNING AND DATING THIS NOTICE, I HEREBY CANCEL MY
517SERVICE CONTRACT, EXECUTED ON:  ...(date service
518contract signed)...
519
520     ...(Signature of Debtor)...
521     ...(Date)...
522     ...(Address)...
523     ...(Phone Number)...
524
525     (4)  The debt relief organization must provide the debtor,
526at the time the documents are signed, with a copy of the
527completed service contract as described in subsection (3) and
528all other documents the organization requires the debtor to
529sign.
530     Section 12.  Section 817.805, Florida Statutes, is
531transferred, renumbered as section 559.112, Florida Statutes,
532and amended to read:
533     559.112 817.805  Disbursement of funds.-A debt relief
534organization offering debt management services that include
535disbursement to a creditor must Any person engaged in debt
536management or credit counseling services shall disburse to the
537appropriate creditors all funds received from a debtor, less any
538fees permitted by s. 559.113 817.802 and any creditor
539contributions, within 30 days after receipt of such funds.
540However, a creditor contribution may not reduce any sums to be
541credited to the account of a debtor making a payment to the
542organization credit counseling agency for further payment to the
543creditor. Further, a debt relief organization offering debt
544settlement services or debt management services must any person
545engaged in such services shall maintain a separate trust account
546for the receipt of any funds from debtors and the disbursement
547of such funds on behalf of such debtors.
548     Section 13.  Section 817.802, Florida Statutes, is
549transferred, renumbered as section 559.113, Florida Statutes,
550and amended to read:
551     559.113 817.802  Prohibited acts Unlawful fees and costs.-
552     (1)  A debt relief organization may not, directly or
553indirectly, charge or accept from a debtor:
554     (a)  Any payment for services before the execution of a
555written service contract. It is unlawful for any person, while
556engaging in debt management services or credit counseling
557services, to charge or accept from a debtor residing in this
558state, directly or indirectly,
559     (b)  A fee or contribution greater than $50 for the initial
560setup or initial consultation. Subsequently, the person may not
561charge or accept
562     (c)  A fee or contribution from a debtor residing in this
563state greater than $120 per year for credit counseling services
564provided in addition to the initial consultation under paragraph
565(b). additional consultations or, alternatively, if
566     (d)  A fee or contribution for debt management services
567which exceeds as defined in s. 817.801(4)(b) are provided, the
568person may charge the greater of 7.5 percent of the amount paid
569monthly by the debtor to the organization for disbursement to a
570creditor person or $35 per month, whichever is greater, or 7.5
571percent of the enrolled debt.
572     (e)  A fee or contribution for debt settlement services
573which exceeds 40 percent of the savings realized, which is
574defined to be the difference between the amount of enrolled debt
575and the amount paid to the creditor in discharge of the enrolled
576debt, less any fees collected pursuant to paragraphs (b) and
577(c). However, such fees collected for debt settlement services,
578in the aggregate, may not exceed 20 percent of the enrolled
579debt. For service contracts requiring fees to be paid on a
580monthly basis, the payment of such fees must be spread uniformly
581over at least 18 months or 50 percent of the term of the
582contract, whichever is greater.
583     (f)  A fee or contribution unless the debt management
584services or debt settlement services result in a settlement,
585discharge, or modification of the debt on terms more favorable
586to the debtor than the terms of the original agreement between
587the debtor and creditor.
588     (g)  Any fee or contribution for debt management, unless no
589other payment has been received, directly or indirectly, from
590the debtor for such services. Fees authorized under this
591subsection may not be a part of or included in the calculation
592of total enrolled debt.
593     (2)  A debt relief organization may not:
594     (a)  Advise any debtor, directly or indirectly, against
595contacting or communicating with her or his creditors before or
596during the service contract period.
597     (b)  Make or use any false or misleading representations or
598omit any material fact in connection with the offer, sale, or
599provision of services, or engage, directly or indirectly, in any
600fraudulent, false, misleading, unconscionable, unfair, or
601deceptive act or practice in connection with the offer or sale
602of any of the services of a debt relief organization.
603     (c)  Provide services to a debtor without executing a
604service contract that complies with s. 559.111.
605     (d)  Fail to provide copies of the financial analysis, all
606service contracts, and any other documents the debtor is
607required to sign as provided under s. 559.111.
608     (e)  Fail to perform any of the terms, conditions, and
609obligations provided in the service contract with the debtor.
610     (f)  Fail to disclose on any offer or sale of services,
611including any Internet website, the debt relief organization's
612name, business address, telephone number, and e-mail address, if
613any.
614     (g)  Fail to provide the debtor with a 5-business-day right
615of cancellation without the debtor incurring any penalty or
616obligation.
617     (h)  Fail to obtain an annual financial audit report and
618surety bond.
619     (i)  Fail to submit an annual financial audit report to the
620office.
621     (j)  Fail to report on a form prescribed by commission rule
622any change to information contained in an initial application
623form or any amendment to the application within 30 days after
624the change is effective.
625     (k)  Fail to comply with any of the provisions of this
626part.
627     (2)  This section does not prohibit any person, while
628engaging in debt management or credit counseling services, from
629imposing upon and receiving from a debtor a reasonable and
630separate charge or fee for insufficient funds transactions.
631     Section 14.  Section 559.114, Florida Statutes, is created
632to read:
633     559.114  Debtor complaints; administrative duties.-
634     (1)  The office shall receive and maintain records of
635correspondence and complaints from debtors concerning any person
636who provides credit counseling, debt management, or debt
637settlement services, including any debt relief organization.
638     (2)  The office shall inform and furnish relevant
639information to the appropriate regulatory body if a debt relief
640organization exempt from registration under this part has been
641named in consumer complaints alleging violations of this part.
642     (3)  The office shall investigate complaints and record the
643resolution of such complaints.
644     (4)  A debt relief organization that provides or attempts
645to provide debt management or debt settlement services without
646first registering in accordance with this part is subject to a
647penalty of up to $25,000 in addition to the other remedies
648provided in this part and under part II of chapter 501. The
649office shall advise the appropriate state attorney, or the
650Attorney General, of any determination by the office of a
651violation of this part by any debt relief organization that is
652not registered as required by this part. The office shall
653furnish the state attorney or Attorney General with the office's
654information concerning the alleged violations of such
655requirements. The enforcing authority is entitled to reasonable
656attorney's fees and costs in any action brought to enforce this
657part against an unregistered debt relief organization.
658     (5)  A registered debt relief organization must provide a
659written response to the office within 20 days after receipt of a
660written request from the office for information concerning a
661consumer complaint. The response must address the issues and
662allegations raised in the complaint. The office may impose an
663administrative fine of up to $2,500 per request per day upon any
664registrant that fails to comply with this subsection.
665     Section 15.  Section 559.115, Florida Statutes, is created
666to read:
667     559.115  Subpoenas.-
668     (1)  The office may:
669     (a)  Issue and serve subpoenas and subpoenas duces tecum to
670compel the attendance of witnesses and the production of all
671books, accounts, records, and other documents and materials
672relevant to an investigation conducted by the office. The
673office, or its authorized representative, may administer oaths
674and affirmations to any person.
675     (b)  Seek subpoenas or subpoenas duces tecum from any court
676to command the appearance of witnesses and the production of
677books, accounts, records, and other documents or materials at a
678time and place named in the subpoenas, and an authorized
679representative of the office may serve such subpoenas.
680     (2)  If there is substantial noncompliance with a subpoena
681or subpoena duces tecum issued by the office, the office may
682petition the court in the county where the person subpoenaed
683resides or has her or his principal place of business for an
684order requiring the person to appear, testify, or produce such
685books, accounts, records, and other documents as are specified
686in the subpoena or subpoena duces tecum.
687     (3)  The office is entitled to the summary procedure
688provided in s. 51.011, and the court shall advance such cause on
689its calendar. Attorney's fees and any other costs incurred by
690the office to obtain an order granting, in whole or in part, a
691petition for enforcement of a subpoena or subpoena duces tecum
692shall be taxed against the subpoenaed person, and failure to
693comply with such order is a contempt of court.
694     (4)  To aid in the enforcement of this part, the office may
695require or permit a person to file a statement in writing, under
696oath or otherwise as the office determines, as to all the facts
697and circumstances concerning the matter to be investigated.
698     Section 16.  Section 559.116, Florida Statutes, is created
699to read:
700     559.116  Cease and desist orders.-The office may issue and
701serve upon any person an order to cease and desist and to take
702corrective action if it has reason to believe the person is
703violating, has violated, or is about to violate any provision of
704this part, any rule or order issued under this part, or any
705written agreement between the person and the office. All
706procedural matters relating to issuance and enforcement of such
707order are governed by the Administrative Procedure Act.
708     Section 17.  Section 817.806, Florida Statutes, is
709transferred, renumbered as section 559.117, Florida Statutes,
710and amended to read:
711     559.117 817.806  Violations; penalties.-
712     (1)  Any person who violates any provision of this part
713commits an unfair or deceptive trade practice as defined in part
714II of chapter 501, and. violators are also shall be subject to
715the penalties, and remedies, and enforcement actions provided
716therein. Further, any debtor consumer injured by a violation of
717this part may bring an action for recovery of damages. Judgment
718shall be entered for actual damages, but in no case less than
719the amount paid by the debtor consumer to the debt relief
720organization credit counseling agency, plus reasonable
721attorney's fees and costs.
722     (2)  The office may impose an administrative fine on, or
723revoke or suspend the registration of a registrant who has
724committed a violation of this part. Final action to fine,
725suspend, or revoke the registration of a registrant is subject
726to review in accordance with chapter 120.
727     (a)  The office may impose suspension rather than
728revocation of a registration if circumstances warrant that one
729or the other should be imposed and the registrant demonstrates
730that the registrant has taken affirmative steps that can be
731expected to effectively eliminate the violations and that the
732registrant's registration has never been previously suspended.
733     (b)  In addition to, or in lieu of suspension or revocation
734of a registration, the office may impose an administrative fine
735of up to $25,000 per violation. The office shall adopt rules
736establishing guidelines for imposing administrative penalties.
737     (3)(2)  It is Any person who violates any provision of this
738part commits a felony of the third degree, punishable as
739provided in s. 775.082, or s. 775.083, or s. 775.084 for any
740person to provide debt management or debt settlement services in
741this state without first registering with the office, or to
742register or attempt to register by means of fraud,
743misrepresentation, or concealment.
744     Section 18.  Sections 559.10, 559.11, 559.12, and 559.13,
745Florida Statutes, are repealed.
746     Section 19.  Paragraph (g) of subsection (1) of section
747516.07, Florida Statutes, is amended to read:
748     516.07  Grounds for denial of license or for disciplinary
749action.-
750     (1)  The following acts are violations of this chapter and
751constitute grounds for denial of an application for a license to
752make consumer finance loans and grounds for any of the
753disciplinary actions specified in subsection (2):
754     (g)  Any violation of part III of chapter 817 or part II of
755chapter 559 or of any rule adopted under part II of chapter 559.
756     Section 20.  Except as otherwise expressly provided in this
757act, this act shall take effect January 1, 2011.


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