House Bill 3975e2
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HB 3975, Second Engrossed/ntc
1 A bill to be entitled
2 An act relating to title loan transactions;
3 creating the "Florida Title Loan Act";
4 providing definitions; providing legislative
5 intent; requiring licensure by the Department
6 of Banking and Finance to be in the business as
7 a title loan lender; providing for eligibility
8 for licensure; providing for application;
9 providing for suspension or revocation of
10 license; providing for a title loan
11 transaction form; providing for recordkeeping
12 and reporting and safekeeping of property;
13 providing for title loan charges; providing a
14 holding period when there is a failure to
15 redeem; providing for the disposal of pledged
16 property; providing for disposition of excess
17 proceeds; prohibiting certain acts; providing
18 for the right to redeem; providing for lost
19 title loan transaction forms; providing for a
20 title loan lenders lien; providing for criminal
21 penalties; providing for certain records from
22 the Department of Law Enforcement; providing
23 for subpoenas, enforcement of actions, and
24 rules; providing a fine; providing for
25 investigations and complaints; amending ss.
26 538.03 and 538.16, F.S.; deleting provisions
27 relating to title loan transactions; providing
28 an appropriation; repealing ss. 538.03(1)(i),
29 538.06(5), and 538.15(4) and (5), F.S.,
30 relating to title loan transactions by
31 secondhand dealers; providing effective dates.
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HB 3975, Second Engrossed/ntc
1 Be It Enacted by the Legislature of the State of Florida:
2
3 Section 1. Short title.--This act may be cited as the
4 "Florida Title Loan Act."
5 Section 2. Legislative intent.--It is the intent of
6 the Legislature that title loans shall be regulated by the
7 provisions of this act. The provisions of this act shall
8 supersede any other provisions of law affecting title loans to
9 the extent of any conflict.
10 Section 3. Definitions.--As used in this act, unless
11 the context otherwise requires:
12 (1) "Department" means the Department of Banking and
13 Finance.
14 (2) "Commercially reasonable" means a sale or disposal
15 which occurs and can be construed as an arms' length
16 transaction. Nonpublic sales or disposal of personal property
17 between licensees and business affiliates or family members
18 are sales and disposal that are presumed not to be in a
19 commercially reasonable fashion.
20 (3) "Executive officer" means the president, chief
21 executive officer, chief financial officer, chief operating
22 officer, executive vice president, senior vice president,
23 secretary, and treasurer.
24 (4) "Identification" means a government issued
25 photographic identification.
26 (5) "Interest" means the cost of obtaining a title
27 loan and includes any profit or advantage of any kind
28 whatsoever that a title loan lender may charge, contract for,
29 collect, receive, or in any way obtain, including, by means of
30 any collateral sale, purchase, or agreement, as a condition of
31 the title loan.
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1 (6) "Licensee" means a person who is licensed pursuant
2 to the provisions of this act.
3 (7) "License" means a permit issued under this chapter
4 to make and collect title loans in accordance with this
5 chapter at a single place of business.
6 (8) "Loan property" means any motor vehicle
7 certificate of title that is deposited with a title loan
8 lender in the course of the title loan lender's business and
9 is the subject of a title loan agreement.
10 (9) "Motor vehicle" means an automobile, motorcycle,
11 truck, trailer, semi-trailer, truck tractor and semitrailer
12 combination, or any other vehicle operated on the public
13 highways and streets of this state, used to transport persons
14 or property, and propelled by power other than muscular power,
15 but excluding vehicles which run only upon a track.
16 (10) "Title loan" means a loan of money secured by
17 bailment of a certificate of title to a motor vehicle.
18 (11) "Title loan agreement" means a written agreement
19 whereby a title loan lender agrees to make a loan of a
20 specific sum of money to a pledgor, and the pledgor agrees to
21 give the title loan lender a security interest in an
22 unencumbered motor vehicle certificate of title owned by the
23 pledgor.
24 (12) "Title loan lender" means any person who is
25 engaged in the business of making title loans or engaging in
26 title loan agreements with pledgors.
27 (13) "Title loan office" means the location at which,
28 or premises from which, a title loan lender regularly conducts
29 business.
30 (14) "Title loan transaction" means any title loan of
31 a motor vehicle from lender to borrower for money.
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1 (15) "Title loan transaction form" means the
2 instrument on which a title loan lender records title loan
3 agreements.
4 (16) "Titled personal property" means a motor vehicle
5 that has as evidence of ownership a state-issued certificate
6 of title except for a mobile home that is the primary
7 residence of the pledgor.
8 (17) "Ultimate equitable owner" means a natural person
9 who, directly or indirectly, owns or controls an ownership
10 interest in a corporation, a foreign corporation, an alien
11 business organization, or any other form of business
12 organization, regardless of whether such natural person owns
13 or controls such ownership interest through one or more
14 natural persons or one or more proxies, powers of attorney,
15 nominees, corporations, associations, partnerships, trusts,
16 joint stock companies, or other entities or devices, or any
17 combination thereof.
18 Section 4. License required; license fees.--
19 (1) A person may not engage in business as a title
20 loan lender unless the person has a valid license issued by
21 the department authorizing the engagement in the business. A
22 separate license is required for each physical location of a
23 title loan office. The department shall issue more than one
24 license to a person who complies with the requirements of this
25 act for each license.
26 (2) An application for a license pursuant to this act
27 shall be submitted to the department on such forms as the
28 department prescribes by rule. If the department determines
29 that an application should be granted, the department shall
30 issue the license for a period not to exceed 2 years. A
31 nonrefundable license fee not to exceed $500 and a
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1 nonrefundable investigation fee of $200 shall accompany an
2 initial application for each title loan location. The revenue
3 from such fees is intended to reasonably reflect the actual
4 cost of regulation.
5 (3) A license shall be renewed biannually and shall be
6 accompanied by a nonrefundable fee not to exceed $500. A
7 license that is not renewed by its expiration date shall
8 automatically expire and revert to inactive status. Such
9 inactive license may be reactivated within 3 months after the
10 expiration date upon submission of a completed reactivation
11 form and payment of a reactivation fee of $250. A license that
12 is not reactivated within 3 months after becoming inactive may
13 not be reactivated.
14 (4) Each license must specify the location for which
15 the license is issued and must be conspicuously displayed at
16 that location. When a licensee wishes to move a title loan
17 office to another location, the licensee shall give 30 days'
18 prior written notice to the department by certified or
19 registered mail, return receipt requested, and the department
20 shall then amend the license accordingly. A license issued
21 pursuant to this act is not transferable or assignable.
22 (5) The department may deny an initial application for
23 a license if the applicant or any person with power to direct
24 the management or policies of the applicant is the subject of
25 a pending criminal prosecution or governmental civil
26 enforcement action, in any jurisdiction, until conclusion of
27 such criminal prosecution or enforcement action.
28 (6) Each licensee shall designate and maintain an
29 agent in this state for service of process.
30 (7) A person shall apply to the department for a new
31 license upon the change of any person owning 25 percent or
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1 greater interest in any title loan office and shall pay the
2 nonrefundable license and investigation fees.
3 (8) All moneys collected by the department under this
4 act shall be deposited into the Regulatory Trust Fund of the
5 Department of Banking and Finance for the sole purpose of
6 implementing this act.
7 Section 5. Eligibility for license.--
8 (1) To be eligible for a title loan lending license,
9 an applicant must:
10 (a) Be of good moral character.
11 (b) File with the department a bond, in the amount of
12 $100,000 for each license, with a surety company qualified to
13 do business in this state. In lieu of the bond, the applicant
14 may establish a certificate of deposit or an irrevocable
15 letter of credit in a financial institution, as defined in s.
16 655.005, in the amount of the bond. The original bond,
17 certificate of deposit, or letter of credit shall be filed
18 with the department, and the department shall be the
19 beneficiary to that document. The bond, certificate of
20 deposit, or letter of credit shall be in favor of the
21 department for the use and benefit of any consumer who is
22 injured pursuant to a title loan transaction by the fraud,
23 misrepresentation, breach of contract, financial failure, or
24 violation of any provision of this act by the title loan
25 lender. Such liability may be enforced either by proceeding in
26 an administrative action or by filing a judicial suit at law
27 in a court of competent jurisdiction. However, in such court
28 suit, the bond, certificate of deposit, or letter of credit
29 posted with the department shall not be amenable or subject to
30 any judgment or other legal process issuing out of or from
31 such court in connection with such lawsuit, but such bond,
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1 certificate of deposit, or letter of credit shall be amenable
2 to and enforceable only by and through administrative
3 proceedings before the department. It is the intent of the
4 Legislature that such bond, certificate of deposit, or letter
5 of credit shall be applicable and liable only for the payment
6 of claims duly adjudicated by order of the department. The
7 bond, certificate of deposit, or letter of credit shall be
8 payable on a pro-rata basis as determined by the department,
9 but the aggregate amount may not exceed the amount of the
10 bond, certificate of deposit, or letter of credit.
11 (c) Not have been convicted of a felony within the
12 last 10 years or be acting as an ultimate equitable owner for
13 someone who has been convicted of a felony within the last 10
14 years.
15 (d) Not have been convicted, and not be acting as an
16 ultimate equitable owner for someone who has been convicted,
17 of a crime that the department finds directly relates to the
18 duties and responsibilities of a title loan lender within the
19 last 10 years.
20 (2) If an applicant for a title loan lending license
21 is other than a corporation, the eligibility requirements of
22 this section apply to each direct or ultimate equitable owner.
23 (3) If an applicant for a title loan lending license
24 is a corporation, the eligibility requirements of this section
25 apply to each direct or ultimate equitable owner of a least 25
26 percent of the outstanding equity interest of such corporation
27 and to each director and executive officer.
28 Section 6. Application for license.--
29 (1) Application for a license to make title loans
30 under this act shall be in writing, under oath, and in the
31 form prescribed by department rule, and shall:
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1 (a) Contain the name and the residence and business
2 addresses of the applicant and, if the applicant is a
3 partnership or association, of every member of such
4 partnership or association and, if a corporation, of each
5 executive officer and director and ultimate equitable owner of
6 at least 25 percent of such corporation.
7 (b) State whether any of the above has, within the
8 last 10 years, been arrested for or convicted of, or is under
9 indictment or information for, a felony or crime.
10 (c) Identify the county and municipality with the
11 street and number or location where the business is to be
12 conducted.
13 (d) Contain such further relevant information as the
14 department requires pursuant to rule.
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16 At the time of making such application the applicant shall pay
17 to the department a nonrefundable license fee not to exceed
18 $500. Applications, except for applications to renew or
19 reactivate a license, must be accompanied by a nonrefundable
20 investigation fee of $200.
21 (2) Notwithstanding subsection (1), the application
22 need not state the full name and address of each officer,
23 director, and shareholder if the applicant is owned directly
24 or beneficially by a person who as an issuer has a class of
25 securities registered pursuant to section 12 of the Securities
26 Exchange Act of 1934 or, pursuant to section 15(d) of such
27 act, is an issuer of securities which is required to file
28 reports with the Securities and Exchange Commission, if the
29 person files with the department any information, documents,
30 and reports required by such act to be filed with the
31 Securities and Exchange Commission.
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1 (3) Upon the filing of an application for a license
2 and payment of all applicable fees, unless the application is
3 to renew or reactivate an existing license, the department
4 shall investigate the facts concerning the applicant's
5 proposed activities. The department shall investigate the
6 facts, and shall approve an application and issue to the
7 applicant a license that will evidence the authority to do
8 business under the provisions of this act if the department
9 finds that the eligibility requirements for the license are
10 satisfied. The license must be prominently displayed at the
11 front desk or counter at the title loan office.
12 (4) A license that is not renewed by its expiration
13 date shall automatically revert to inactive status. An
14 inactive license may be reactivated upon submission of a
15 completed reactivation application, payment of the biannual
16 license fee, and payment of a reactivation fee of $250. A
17 license expires on the date on which it has been inactive for
18 3 months.
19 (5) A licensee may not change the place of business
20 maintained under a license without prior notice to the
21 department. When a licensee wishes to change a place of
22 business, the licensee shall give written notice of such
23 change to the department.
24 (6) A licensee may not conduct the business of making
25 loans under this act within a place of business in which other
26 business is solicited or engaged in, unless the department
27 finds that the conduct of such other business by the licensee
28 does not result in either the evasion of this act or the
29 combining of such other business activities does not result in
30 practices that are detrimental, misleading, or unfair to
31 consumers. Upon such a finding, the department may authorize
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1 the combining of such other business activities. However, no
2 license shall be granted to or renewed for any person or
3 organization engaged in the pawnbroking business.
4 (7) Licenses are not transferable or assignable. A
5 licensee may invalidate any license by delivering the license
6 to the department with written notice of its surrender by
7 certified or registered mail, return receipt requested, but
8 such delivery does not affect any civil or criminal liability
9 or the authority to enforce this act for acts committed in
10 violation thereof.
11 Section 7. Suspension, revocation of license.--
12 (1) The following acts are violations of this act and
13 constitute grounds for the disciplinary actions specified in
14 subsection (2):
15 (a) Failure to comply with any provision of this act,
16 any rule or order adopted pursuant to this act, or any written
17 agreement entered into with the department.
18 (b) Fraud, misrepresentation, deceit, or gross
19 negligence in any title loan transaction, regardless of
20 reliance by or damage to the pledgor.
21 (c) Fraudulent misrepresentation, circumvention, or
22 concealment of any matter required to be stated or furnished
23 to a pledgor pursuant to this act, regardless of reliance by
24 or damage to the pledgor.
25 (d) Willful imposition of illegal or excessive charges
26 in any title loan transaction.
27 (e) False, deceptive, or misleading advertising by a
28 title loan lender.
29 (f) Failure to maintain, preserve, and keep available
30 for examination, all books, accounts, or other documents
31 required by this act, by any rule or order adopted pursuant to
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1 this act, or by any agreement entered into with the
2 department.
3 (g) The title loan lender has aided, abetted, or
4 conspired with an individual or person to circumvent or
5 violate any of the requirements of this act.
6 (h) Refusal to permit inspection of books and records
7 in an investigation or examination by the department or
8 refusal to comply with a subpoena issued by the department.
9 (i) Criminal conduct by a title loan lender.
10 (2) Upon a finding by the department that any person
11 has committed any of the acts set forth in subsection (1), the
12 department may enter an order taking any of the following
13 actions:
14 (a) Issuing a notice of noncompliance pursuant to s.
15 120.695, Florida Statutes;
16 (b) Denying an application for a license pursuant to
17 this act;
18 (c) Revoking or suspending a license previously
19 granted pursuant to this act;
20 (d) Placing a licensee or an applicant for a license
21 on probation for a period of time and subject to such
22 conditions as the department specifies;
23 (e) Placing permanent restrictions or conditions upon
24 issuance or maintenance of a license pursuant to this act;
25 (f) Issuing a reprimand; or
26 (g) Imposing an administrative fine not to exceed
27 $5,000 for each such act or violation.
28 (3) In addition to the acts specified in subsection
29 (1), the following shall be grounds for denial of a license
30 pursuant to this act, or for revocation, suspension, or
31 restriction of a license previously granted:
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1 (a) A material misstatement of fact in an initial or
2 renewal application for a license.
3 (b) Having a license, registration, or the equivalent,
4 to practice any profession or occupation denied, suspended,
5 revoked, or otherwise acted against by a licensing authority
6 in any jurisdiction for fraud, dishonest dealing, or any act
7 of moral turpitude.
8 (c) Having been convicted or found guilty of a crime
9 involving fraud, dishonest dealing, or any act of moral
10 turpitude.
11 (d) Being insolvent or having demonstrated a lack of
12 honesty or financial responsibility.
13 (e) A fact or condition exists which, if it had
14 existed or had been known to exist at the time of the original
15 issuance of the license, would have justified the department
16 in refusing a license.
17 (4) It is sufficient cause for the department to take
18 any of the actions specified in subsection (2), as to any
19 partnership, corporation, or association, if the department
20 finds grounds for such action as to any member of the
21 partnership, as to any executive officer or director of the
22 corporation or association, or as to any person with power to
23 direct the management or policies of the partnership,
24 corporation, or association.
25 (5) Each licensee licensed pursuant to this act is
26 responsible for the acts of employees and agents of the
27 licensee if the licensee knew or should have known about such
28 acts and the licensee retained the profits, benefits, or
29 advantages accruing from such acts or ratified the conduct of
30 the employee or agent as a matter of law or fact.
31
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1 (6) The manner of giving notice and conducting a
2 hearing is governed by chapter 120, Florida Statutes.
3 (7) Any title loan agreement made without benefit of a
4 license is voidable, in which case the person forfeits the
5 right to collect any moneys, including principal and finance
6 charges, from the pledgor in connection with such agreement,
7 and shall return to the pledgor the loan property in
8 connection with such agreement or the fair market value of
9 such property and all principal and interest made by the
10 pledgor.
11 Section 8. Title loan transaction form.--
12 (1) At the time a title loan lender enters into each
13 title loan agreement, the title loan lender shall complete a
14 title loan transaction form for such transaction, and the
15 pledgor shall sign such completed form. The department shall
16 approve the design and format of the title loan transaction
17 form, which shall elicit the information required under this
18 section. In completing the title loan transaction form, the
19 title loan lender shall record the following information,
20 which shall be typed or written indelibly and legibly in
21 English.
22 (a) The make, model, and year of the titled personal
23 property to which the loan property relates.
24 (b) The vehicle identification number, or other
25 comparable identification number, along with the license plate
26 number, if applicable, of the titled personal property to
27 which the loan property relates.
28 (c) The name, address, date of birth, physical
29 description, and social security number of the pledgor.
30 (d) The date of the transaction.
31
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1 (e) The identification number and the type of
2 identification, including the issuing agency, accepted from
3 the pledgor.
4 (f) The amount of money advanced, which shall be
5 designated as the "amount financed."
6 (g) The maturity date of the title loan agreement,
7 which shall be 30 days after the date of the transaction.
8 (h) The total title loan charge payable on the
9 maturity date, designated as the "finance charge."
10 (i) The total amount, amount financed plus finance
11 charge, which must be paid to redeem the loan property on the
12 maturity date, designated as the "total amount of all
13 payments."
14 (j) The annual percentage rate, computed in accordance
15 with the regulations adopted by the Federal Reserve Board
16 pursuant to the Federal Truth-in-Lending Act.
17 (2) The following information shall also be printed on
18 all title loan transaction forms:
19 (a) The name and address of the title loan office.
20 (b) The name and address of the department as well as
21 a telephone number to which consumers may address complaints.
22 (c) The following statement in not less than 12-point
23 type that:
24 1. The pledgor is not obligated to redeem the subject
25 certificate of title.
26 2. If the pledgor does not redeem the certificate of
27 title before the maturity date of the title loan agreement,
28 the title loan lender may repossess the titled personal
29 property to which the certificate of title relates.
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1 3. If the title loan transaction form is lost,
2 destroyed, or stolen, the pledgor should immediately so advise
3 the issuing title loan lender in writing.
4 (d) The statement that "The pledgor represents and
5 warrants that the titled personal property to which the loan
6 property relates is not stolen and has no liens or
7 encumbrances against it, the pledgor has the right to enter
8 into this transaction, and the pledgor will not apply for a
9 duplicate certificate of title while the title loan agreement
10 is in effect."
11 (e) Immediately above the signature of the pledgor,
12 the statement that "I, the pledgor declare under penalty of
13 perjury that I have read the foregoing document and that, to
14 the best of my knowledge and belief, the facts contained in it
15 are true and correct."
16 (f) A blank line for the signature of the pledgor.
17 (3) At the time of the transaction, the title loan
18 lender shall deliver to the pledgor an exact copy of the
19 completed title loan transaction form.
20 (4) The pledgor shall agree for the title loan lender
21 to keep possession of the certificate of title. The pledgor
22 shall have the exclusive right to redeem the certificate of
23 title by repaying the loan of money in full and by complying
24 with the title loan agreement. When the certificate of title
25 is redeemed, the title loan lender shall release the security
26 interest in the titled personal property and return the
27 personal property certificate of title to the pledgor. The
28 title loan agreement shall provide that upon failure by the
29 pledgor to redeem the certificate of title at the end of the
30 original 30-day-agreement period, or at the end of any 30-day
31 extension of such period, the title loan lender shall be
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1 allowed to take possession of the titled personal property.
2 The title loan lender shall retain physical possession of the
3 certificate of title for the entire term of the title loan
4 agreement, but shall not be required to retain physical
5 possession of the titled personal property at any time. A
6 title loan lender may only hold unencumbered certificates of
7 title for loan.
8 Section 9. Recordkeeping; reporting; safekeeping of
9 property.--
10 (1) Every title loan lender shall maintain, at the
11 principal place of business, such books, accounts, and records
12 of the business conducted under the license issued for such
13 place of business as will enable the department to determine
14 the licensee's compliance with this act. The licensee shall
15 make all such books, accounts, and records of business
16 conducted under the license available at a convenient location
17 in this state upon request of the department.
18 (2) The department may authorize the maintenance of
19 books, accounts, and records at a location other than a
20 principal place of business. The department may require books,
21 accounts, and records to be produced and available at a
22 reasonable and convenient location in this state within a
23 reasonable period of time after such a request.
24 (3) The title loan lender shall maintain the original
25 copy of each completed title loan transaction form on the
26 title loan office premises, and shall not obliterate, discard,
27 or destroy any such original copy, for a period of at least 2
28 years after making the final entry on any loan recorded in
29 such office.
30 (4) All loan property, or property related to the
31 title loan transaction, which is delivered to a title loan
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1 lender shall be securely stored and maintained at the title
2 loan office unless the title document has been forwarded to
3 the appropriate state agency for the purpose of having a lien
4 recorded or deleted.
5 (5) The department may prescribe the minimum
6 information to be shown in the books, accounts, and records of
7 licensees so that such records will enable the department to
8 determine compliance with the provisions of this act.
9 Section 10. Title loan charges.--
10 (1) A title loan lender may charge a maximum interest
11 rate of 30 percent per annum computed on the first $2,000 of
12 the principal amount, 24 percent per annum on that part of the
13 principal amount exceeding $2,000 and not exceeding $3,000,
14 and 18 percent per annum on that part of the principal amount
15 exceeding $3,000. The original principal amount is the same
16 amount as the amount financed, as defined by the federal Truth
17 in Lending Act and Regulation Z of the Board of Governors of
18 the Federal Reserve System. In determining compliance with the
19 statutory maximum interest and finance charges, the
20 computations must be simple interest and not add-on interest
21 or any other computations. When two or more interest rates are
22 to be applied to the principal amount, the lender may charge
23 interest at that single annual percentage rate which, if
24 applied according to the actuarial method to each of the
25 scheduled periodic balances of principal, would produce at
26 maturity the same total amount of interest as would result
27 from the application of the two or more rates otherwise
28 permitted, based upon the assumption that all payments are
29 made as agreed.
30 (2) The annual percentage rate that may be charged in
31 a title loan transaction may equal, but not exceed, the annual
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1 percentage rate that must be computed and disclosed as
2 required by the federal Truth in Lending Act and Regulation Z
3 of the Board of Governors of the Federal Reserve System. The
4 maximum annual percentage rate of finance charge that may be
5 charged is 12 times the maximum monthly rate, and the maximum
6 monthly rate must be computed on the basis of one-twelfth of
7 the annual rate for each full month. The Department of Banking
8 and Finance shall establish the rate for each day in a
9 fraction of a month when the period for which the charge is
10 computed is more or less than 1 month.
11 (3) Any charges, including interest, in excess of the
12 combined total of all charges permitted by this act constitute
13 a violation of chapter 687, Florida Statutes, governing
14 interest and usury, and the penalties of that chapter apply.
15 If a bona fide error occurs, the lender must refund or credit
16 the borrower with the amount of the overcharge within 20 days
17 after the discovery of such error.
18 (4) Any finance charge contracted for or received,
19 directly or indirectly, in excess of the amounts authorized
20 under this section are prohibited, may not be collected, and
21 render the title loan agreement voidable, in which case the
22 title loan lender shall forfeit the right to collect any
23 interest or finance charges. Upon the pledgor's written
24 request delivered to the title loan lender by certified mail,
25 return receipt requested, within 30 days after the maturity
26 date, the title loan lender shall be obligated to return to
27 the pledgor the loan property delivered to the title loan
28 lender in connection with the title loan agreement upon
29 payment of the balance of the principal remaining due,
30 provided that there shall be no penalty for a violation
31 resulting from an accidental and bona fide error that is
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1 corrected upon discovery. Any action to circumvent the
2 limitation on title loan interest or any other amounts
3 collectible under this act is voidable. Any transaction
4 involving a person's delivery of a personal property
5 certificate of title in exchange for the advancement of funds
6 on the condition that the person shall or may redeem or
7 repurchase the certificate of title upon the payment of a sum
8 of money, whether the transaction be characterized as a
9 "buy-sell agreement," "sale-leaseback agreement," or
10 otherwise, shall be deemed a violation of this act if such sum
11 exceeds the amount that a title loan lender may collect in a
12 title loan agreement under this act or if the terms of the
13 transaction otherwise conflict with the permitted terms and
14 conditions of a title loan agreement under this act.
15 Section 11. Disposal of pledged property; excess
16 proceeds.--
17 (1) Any motor vehicle which is security for a title
18 loan, is subject to sale or disposal if the title has not been
19 redeemed from the title lender or there has been no payment
20 made on account within 60 days after payment was due. Every
21 title loan transaction form shall contain a notice of the
22 provisions of this subsection. Any such sale or disposal shall
23 vest in the purchaser the right, title, and interest of the
24 owner and the title loan lender.
25 (2) A title loan lender has the right to take
26 possession of the motor vehicle upon failure of the owner to
27 redeem the title within the time period specified in
28 subsection (1). The title loan lender shall only take
29 possession of a motor vehicle through an agent who is licensed
30 by the state to repossess motor vehicles. The title loan
31 lender may dispose of the motor vehicle as provided in this
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1 section. Any sale or disposal of the motor vehicle shall be
2 made through a motor vehicle dealer licensed under s. 320.27.
3 (3) Within 30 days after the sale of the motor
4 vehicle, the title loan borrower is entitled to receive moneys
5 from the sale of the motor vehicle in excess of the principal
6 amount of the loan, interest on the loan up to the date of
7 repossession, and reasonable expenses for the repossession,
8 holding, and sale of the motor vehicle. The borrower is
9 entitled to receive reasonable attorney's fees and costs in
10 any action brought to recover the excess amount that results
11 in the title loan lender being ordered to return all or part
12 of such amount.
13 (4) Except as provided by this section, the taking
14 possession and sale or disposal of the motor vehicle is
15 subject to the requirements of chapter 679, Florida Statutes.
16 Section 12. Prohibited acts.--
17 (1) A title loan lender, or any agent or employee of a
18 title loan lender, shall not:
19 (a) Falsify or fail to make an entry of any material
20 matter in a title loan lender transaction form.
21 (b) Refuse to allow the department to inspect
22 completed title loan transaction forms or loan property during
23 the ordinary hours of the title loan lender's business or
24 other times acceptable to both parties.
25 (c) Enter into a title loan agreement with a person
26 under the age of 18 years.
27 (d) Make any agreement requiring or allowing for the
28 personal liability of a pledgor or the waiver of any of the
29 provisions of this act.
30 (e) Knowingly enter into a title loan agreement with
31 any person who is under the influence of drugs or alcohol when
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1 such condition is visible or apparent, or with any person
2 using a name other than such person's own name or the
3 registered name of the person's business.
4 (f) Fail to exercise reasonable care in the
5 safekeeping of loan property or of titled personal property
6 repossessed pursuant to this act.
7 (g) Fail to return loan property or repossessed titled
8 personal property to a pledgor, with any and all of the title
9 loan lender's liens on the property properly released, upon
10 payment of the full amount due the title loan lender, unless
11 the property has been seized or impounded by an authorized law
12 enforcement agency, taken into custody by a court, or
13 otherwise disposed of by court order.
14 (h) Sell or otherwise charge for insurance in
15 connection with a title loan agreement.
16 (i) Charge or receive any finance charge, interest, or
17 fees which are not authorized pursuant to this act.
18 (j) Engage in business as a title loan lender without
19 first securing a license.
20 (k) Refuse to accept a partial repayment of the
21 obligation owed and outstanding.
22 (l) Charge a prepayment penalty.
23 (2) Title loan companies may not advertise using the
24 words "interest free loans" or "no finance charges."
25 Section 13. Right to redeem; lost title loan
26 transaction form.--
27 (1) Any person presenting identification of such
28 person as the pledgor and presenting the pledgor's copy of the
29 title loan transaction form to the title loan lender is
30 presumed to be entitled to redeem the loan property described
31 in the title loan lender transaction form. However, if the
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1 title loan lender determines that the person is not the
2 pledgor, the title loan lender is not required to allow the
3 redemption of the loan property by such person. The person
4 redeeming the loan property must sign the pledgor's copy of
5 the title loan transaction form, which the title loan lender
6 may retain to evidence such person's receipt of the loan
7 property. A person redeeming the loan property who is not the
8 pledgor, must show identification to the title loan lender,
9 together with written authorization from the pledgor, and the
10 title loan lender shall record that person's name and address
11 on the title loan transaction form retained by the title loan
12 lender. In any such case, the person redeeming the pledgor's
13 copy of the title loan transaction form shall be provided a
14 copy of such signed form as evidence of such transaction.
15 (2) If the pledgor's copy of the title loan
16 transaction form is lost, destroyed, or stolen, the pledgor
17 must notify the title loan lender, in writing by certified or
18 registered mail, return receipt requested, or in person
19 evidenced by a signed receipt, and receipt of such notice
20 shall invalidate such title loan transaction form if the loan
21 property has not previously been redeemed. Before delivering
22 the loan property or issuing a new title loan transaction
23 form, the title loan lender shall require the pledgor to make
24 a written statement of the loss, destruction, or theft of the
25 pledgor's copy of the title loan transaction form. The title
26 loan lender shall record on the written statement the type of
27 identification and the identification number accepted from the
28 pledgor, the date the statement is given, and the number or
29 date of the title loan transaction form lost, destroyed, or
30 stolen. The statement shall be signed by the title loan lender
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1 or the title loan office employee who accepts the statement
2 from the pledgor.
3 Section 14. Criminal penalties.--
4 (1) Any person who engages in business as a title loan
5 lender without first securing the license prescribed by this
6 act commits a felony of the third degree, punishable as
7 provided in s. 775.082, s. 775.083, or s. 775.084, Florida
8 Statutes.
9 (2) In addition to any other applicable penalty, any
10 person who willfully violates any provision of this act or who
11 willfully makes a false entry in any record specifically
12 required by this act commits a misdemeanor of the first
13 degree, punishable as provided in s. 775.082 or s. 775.083,
14 Florida Statutes.
15 Section 15. Records from the Department of Law
16 Enforcement.--The Department of Law Enforcement, on request,
17 shall supply to the department any arrest and conviction
18 records in the possession of the Department of Law Enforcement
19 of an individual applying for or holding a license under this
20 act.
21 Section 16. Subpoenas; enforcement actions; rules.--
22 (1) The department may issue and serve subpoenas to
23 compel the attendance of witnesses and the production of
24 documents, papers, books, records, and other evidence before
25 the department in any matter pertaining to this act. The
26 department may administer oaths and affirmations to any person
27 whose testimony is required. If any person refuses to testify,
28 produce books, records, and documents, or otherwise refuses to
29 obey a subpoena issued under this section, the department may
30 enforce the subpoena in the same manner as subpoenas issued
31 under the Administrative Procedure Act are enforced. Witnesses
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1 are entitled to the same fees and mileage as they are entitled
2 to by law for attending as witnesses in the circuit court,
3 unless such examination or investigation is held at the place
4 of business or residence of the witness.
5 (2) In addition to any other powers conferred upon the
6 department to enforce or administer this act, the department
7 may:
8 (a) Bring an action in any court of competent
9 jurisdiction to enforce or administer this act, any rule or
10 order adopted under this act, or any written agreement entered
11 into with the department. In such action, the department may
12 seek any relief at law or equity including a temporary or
13 permanent injunction, appointment of a receiver or
14 administrator, or an order of restitution.
15 (b) Issue and serve upon a person an order requiring
16 such person to cease and desist and take corrective action
17 whenever the department finds that such person is violating,
18 has violated, or is about to violate any provision of this
19 act, any rule or order adopted under this act, or any written
20 agreement entered into with the department.
21 (c) Whenever the department finds that conduct
22 described in paragraph (b) presents an immediate danger to the
23 public health, safety, or welfare requiring an immediate final
24 order, the department may issue an emergency cease and desist
25 order reciting with particularity the facts underlying such
26 findings. The emergency cease and desist order is effective
27 immediately upon service of a copy of the order on the
28 respondent named in the order and shall remain effective for
29 90 days. If the department begins nonemergency proceedings
30 under paragraph (b), the emergency cease and desist order
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1 remains effective until the conclusion of the proceedings
2 under ss. 120.569 and 120.57, Florida Statutes.
3 (d) Impose and collect an administrative fine against
4 any person found to have violated any provision of this act,
5 any rule or order adopted under this act, or any written
6 agreement entered into with the department, in an amount not
7 to exceed $5,000 for each violation.
8 (3) The department may adopt rules pursuant to the
9 Administrative Procedure Act to implement this act.
10 Section 17. Investigations and complaints.--
11 (1) The department may make any investigation and
12 examination of any licensee or other person the department
13 deems necessary to determine compliance with this act. For
14 such purposes, the department may examine the books, accounts,
15 records, and other documents or matters of any licensee or
16 other person. The department may compel the production of all
17 relevant books, records, and other documents and materials
18 relative to an examination or investigation. Such
19 investigations and examinations shall not be made more often
20 than once during any 12-month period unless the department has
21 good cause to believe the licensee is not complying with the
22 provisions of this act.
23 (2) The expenses of the department incurred in each
24 such examination may be established by department rule but
25 shall not exceed $250 per 8-hour day for each examiner. Such
26 examination fee shall be calculated on an hourly basis and
27 shall be rounded to the nearest hour. The licensee shall also
28 pay the travel expense and per diem subsistence allowance
29 provided for state employees in s. 112.061. The licensee
30 shall not be required to pay a per diem fee and expenses of an
31 examination which shall consume more than 30 worker-days in
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1 any one year unless such examination or investigation is due
2 to fraudulent practices of the licensee, in which case such
3 licensee shall be required to pay the entire cost regardless
4 of time consumed.
5 (3) Any person having reason to believe that any
6 provision of this act has been violated may file with the
7 department a written complaint setting forth the details of
8 such alleged violation and the department upon receipt of such
9 complaint, may inspect the pertinent books, records, letters,
10 and contracts of the licensee and of the seller involved,
11 relating to such specific written complaint.
12 Section 18. Paragraphs (a) and (h) of subsection (1)
13 of section 538.03, Florida Statutes, are amended to read:
14 538.03 Definitions; applicability.--
15 (1) As used in this part, the term:
16 (a) "Secondhand dealer" means any person, corporation,
17 or other business organization or entity which is not a
18 secondary metals recycler subject to part II and which is
19 engaged in the business of purchasing, consigning, or pawning
20 secondhand goods or entering into title loan transactions.
21 However, secondhand dealers are not limited to dealing only in
22 items defined as secondhand goods in paragraph (g). Except as
23 provided in subsection (2), the term means pawnbrokers,
24 jewelers, precious metals dealers, garage sale operators,
25 secondhand stores, and consignment shops.
26 (h) "Transaction" means any title loan, purchase,
27 consignment, or pawn of secondhand goods by a secondhand
28 dealer.
29 Section 19. Subsection (1) of section 538.16, Florida
30 Statutes, is amended to read:
31 538.16 Secondhand dealers; disposal of property.--
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1 (1) Any personal property pawned with a pawnbroker,
2 whether the pawn is a loan of money or a buy-sell agreement or
3 a motor vehicle which is security for a title loan, is subject
4 to sale or disposal if the pawn is a loan of money and the
5 property has not been redeemed or there has been no payment on
6 account made for a period of 90 days, or if the pawn is a
7 buy-sell agreement or if it is a title loan and the property
8 has not been repurchased from the pawnbroker or the title
9 redeemed from the title lender or there has been no payment
10 made on account within 60 days.
11 Section 20. Effective July 1, 1998, the sum of
12 $500,000 is hereby appropriated for the 1998-1999 fiscal year
13 from the Regulatory Trust Fund of the Department of Banking
14 and Finance to the department to fund nine positions for the
15 purpose of carrying out the provisions of this act.
16 Section 21. Paragraph (i) of subsection (1) of section
17 538.03, Florida Statutes, subsection (5) of section 538.06,
18 Florida Statutes, and subsections (4) and (5) of section
19 538.15, Florida Statutes, are hereby repealed.
20 Section 22. Except as otherwise provided in this act,
21 this act shall take effect October 1 of the year in which
22 enacted.
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