Senate Bill 1264c1

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    Florida Senate - 1999                           CS for SB 1264

    By the Committee on Banking and Insurance; and Senator Rossin





    311-1721-99

  1                      A bill to be entitled

  2         An act relating to consumer finance; amending

  3         s. 516.03, F.S.; increasing an application fee;

  4         amending ss. 516.05, 520.997, F.S.; requiring

  5         licensees to notify the Department of Banking

  6         and Finance before relocating a business;

  7         requiring a licensee to report bankruptcy

  8         filings to the department; amending ss. 516.07,

  9         520.995, F.S.; providing additional grounds for

10         certain disciplinary actions; amending ss.

11         516.11, 520.996, F.S.; deleting a schedule of

12         examination fees; providing criteria for paying

13         travel expenses and per diem allowances to

14         examiners; amending s. 615.12, F.S.; requiring

15         that licensees make accounts and records

16         available to the Department of Banking and

17         Finance; amending ss. 520.02, 520.31, 520.61,

18         F.S.; providing additional definitions;

19         amending ss. 520.03, 520.32, 520.52, 520.63,

20         F.S.; clarifying procedures for obtaining

21         certain licenses and imposing certain license

22         application and renewal fees; requiring

23         department notification before relocating

24         certain offices; amending s. 520.07, F.S.;

25         providing for calculating the amount financed;

26         requiring disclosure of additional information

27         under certain installment contracts; requiring

28         evidence of satisfaction of lien under certain

29         installment contracts; amending s. 520.085,

30         F.S.; authorizing certain additional charges

31         under certain installment contracts; providing

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  1         for a deferment of the due date of certain

  2         contracts; providing a fee; providing for the

  3         extension of insurance coverage; providing

  4         disclosure requirement; amending s. 520.34,

  5         F.S.; authorizing sellers under retail

  6         installment contracts to collect a processing

  7         fee under certain circumstances; amending s.

  8         520.994, F.S.; authorizing rules to allow

  9         electronic submission of forms, documents, and

10         fees; amending ss. 559.9232, 681.102, and

11         697.05, F.S.; conforming cross-references;

12         providing effective dates.

13

14  Be It Enacted by the Legislature of the State of Florida:

15

16         Section 1.  Section 516.03, Florida Statutes, is

17  amended to read:

18         516.03  Application for license; fees; etc.--

19         (1)  APPLICATION.--Application for a license to make

20  loans under this chapter shall be in writing, under oath, and

21  in the form prescribed by rule of the department, and shall

22  contain the name, residence and business addresses of the

23  applicant and, if the applicant is a copartnership or

24  association, of every member thereof and, if a corporation, of

25  each officer and director thereof, also the county and

26  municipality with the street and number or approximate

27  location where the business is to be conducted, and such

28  further relevant information as the department may require.

29  At the time of making such application the applicant shall pay

30  to the department a biennial license fee of $625 $550.

31  Applications, except for applications to renew or reactivate a

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  1  license, must also be accompanied by an investigation fee of

  2  $200. The department may adopt rules to allow electronic

  3  submission of any form, document, or fee required by this act.

  4         (2)  FEES.--Fees herein provided for shall be collected

  5  by the department and shall be turned into the State Treasury

  6  to the credit of the regulatory trust fund under the Division

  7  of Finance of the department.  The department shall have full

  8  power to employ such examiners or clerks to assist the

  9  department as may from time to time be deemed necessary and

10  fix their compensation. The department may adopt rules to

11  allow electronic submission of any fee required by this

12  section.

13         Section 2.  Subsection (4) of section 516.05, Florida

14  Statutes, is amended, and subsection (9) is added to that

15  section, to read:

16         516.05  License.--

17         (4)  Prior to relocating his or her place of business,

18  a licensee must file with the department, in the manner

19  prescribed by department rule, notice of the relocation. A

20  licensee may not change the place of business maintained under

21  a license without prior approval of the department.  When a

22  licensee wishes to change a place of business, the licensee

23  shall give written notice thereof to the department, and, if

24  the department finds that the proposed location is reasonably

25  accessible to borrowers under existing loan contracts, it

26  shall permit the change and shall amend the license

27  accordingly. If the department does not so find, it shall

28  enter an order denying removal of the business to the

29  requested location.

30

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  1         (9)  A licensee that is the subject of a voluntary or

  2  involuntary bankruptcy filing must report such filing to the

  3  department within 7 business days after the filing date.

  4         Section 3.  Subsection (1) of section 516.07, Florida

  5  Statutes, is amended to read:

  6         516.07  Grounds for denial of license or for

  7  disciplinary action.--

  8         (1)  The following acts are violations of this chapter

  9  and constitute grounds for denial of an application for a

10  license to make consumer finance loans and grounds for any of

11  the disciplinary actions specified in subsection (2):

12         (a)  A material misstatement of fact in an application

13  for a license;

14         (b)  Failure to maintain liquid assets of at least

15  $25,000 at all times for the operation of business at a

16  licensed location or proposed location;

17         (c)  Failure to demonstrate financial responsibility,

18  experience, character, or general fitness, such as to command

19  the confidence of the public and to warrant the belief that

20  the business operated at the licensed or proposed location is

21  lawful, honest, fair, efficient, and within the purposes of

22  this chapter;

23         (d)  The violation, either knowingly or without the

24  exercise of due care, of any provision of this chapter, any

25  rule or order adopted under this chapter, or any written

26  agreement entered into with the department;

27         (e)  Any act of fraud, misrepresentation, or deceit,

28  regardless of reliance by or damage to a borrower, or any

29  illegal activity, where such acts are in connection with a

30  loan under this chapter.  Such acts include, but are not

31  limited to:

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  1         1.  Willful imposition of illegal or excessive charges;

  2  or

  3         2.  Misrepresentation, circumvention, or concealment of

  4  any matter required to be stated or furnished to a borrower;

  5         (f)  The use of unreasonable collection practices or of

  6  false, deceptive, or misleading advertising, where such acts

  7  are in connection with the operation of a business to make

  8  consumer finance loans;

  9         (g)  Any violation of part III of chapter 817 or part

10  II of chapter 559 or of any rule adopted under part II of

11  chapter 559;

12         (h)  Failure to maintain, preserve, and keep available

13  for examination, all books, accounts, or other documents

14  required by this chapter, by any rule or order adopted under

15  this chapter, or by any agreement entered into with the

16  department; or

17         (i)  Refusal to permit inspection of books and records

18  in an investigation or examination by the department or

19  refusal to comply with a subpoena issued by the department;

20         (j)  Pleading nolo contendere to, or having been

21  convicted or found guilty of, a crime involving fraud,

22  dishonest dealing, or any act of moral turpitude, regardless

23  of whether adjudication is withheld;

24         (k)  Paying money or anything else of value, directly

25  or indirectly, to any person as compensation, inducement, or

26  reward for referring loan applicants to a licensee;

27         (l)  Allowing any person other than the licensee to use

28  the licensee's business name, address, or telephone number in

29  an advertisement;

30         (m)  Accepting or advertising that the licensee accepts

31  money on deposit or as consideration for the issuance or

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  1  delivery of certificates of deposit, savings certificates, or

  2  similar instruments, except to the extent permitted under

  3  chapter 517; or

  4         (n)  Failure to pay any fee, charge, or fine imposed or

  5  assessed pursuant to this chapter or any rule adopted under

  6  this chapter.

  7         Section 4.  Effective January 1, 2001, subsections (1)

  8  and (2) of section 516.11, Florida Statutes, are amended to

  9  read:

10         516.11  Investigations and complaints.--

11         (1)  The department shall, at intermittent periods,

12  make such investigations and examinations of any licensee or

13  other person as it deems necessary to determine compliance

14  with this chapter.  For such purposes, the department may

15  examine the books, accounts, records, and other documents or

16  matters of any licensee or other person and compel the

17  production of all relevant books, records, and other documents

18  and materials relative to an examination or investigation.

19  Examinations of a licensee may not be made more often than

20  once a year unless the department has reason to believe the

21  licensee is not complying with this chapter. Each licensee

22  shall pay to the department an examination fee based upon the

23  amount of outstanding loans due the licensee at the time of

24  the examination, as follows:

25

26         Amount Outstanding                      Examination Fee

27  From $0 to $50,000........................................$100

28  From $50,000.01 to $100,000................................125

29  From $100,000.01 to $250,000...............................150

30  From $250,000.01 to $500,000...............................200

31  From $500,000.01 and over..................................325

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  1

  2         (2)  The department shall conduct all examinations at a

  3  convenient location in this state unless the department

  4  determines that it is more effective or cost-efficient to

  5  perform an examination at the licensee's out-of-state

  6  location. For an examination performed at the licensee's

  7  out-of-state location, the licensee shall also pay the travel

  8  expense and per diem subsistence at the rate provided by law

  9  for up to 30 eight-hour days per year for each examiner who

10  participates in such an examination. However, if the

11  examination involves or reveals possible fraudulent conduct of

12  the licensee, the licensee shall pay the travel expenses and

13  per diem subsistence provided by law, without limitation, for

14  each participating examiner allowance provided for state

15  employees in s. 112.061. The licensee shall not be required to

16  pay a per diem fee and expenses of an examination which shall

17  consume more than 30 worker-days in any one year unless such

18  examination or investigation is due to fraudulent practices of

19  the licensee, in which case such licensee shall be required to

20  pay the entire cost regardless of time consumed.

21         Section 5.  Subsection (2) of section 516.12, Florida

22  Statutes, is amended to read:

23         516.12  Records to be kept by licensee.--

24         (2)  A licensee, operating two or more licensed places

25  of business in this state, may maintain the books, accounts,

26  and records of all such offices at any one of such offices, or

27  at any other office maintained by such licensee, upon the

28  filing of a written request with the department designating in

29  the written request therein the office at which such records

30  are maintained. However, the licensee shall make all books,

31

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  1  accounts, and records available at a convenient location in

  2  this state upon request of the department.

  3         Section 6.  Present subsections (1) through (9) of

  4  section 520.02, Florida Statutes, are renumbered as

  5  subsections (2) through (10), respectively, present

  6  subsections (10) through (15) of that section are renumbered

  7  as subsections (12) through (17), respectively, and new

  8  subsections (1) and (11) are added to that section, to read:

  9         520.02  Definitions.--In this act, unless the context

10  or subject matter otherwise requires:

11         (1)  "Branch" means any location, other than a

12  licensee's principal place of business, at which a licensee

13  operates or conducts business under this act or which a

14  licensee owns or controls for the purpose of conducting

15  business under this act.

16         (11)  "Principal place of business" means the physical

17  location designated on the licensee's application for

18  licensure, unless otherwise designated as required by this

19  chapter.

20         Section 7.  Subsections (2), (3), and (4) of section

21  520.03, Florida Statutes, are amended to read:

22         520.03  Licenses.--

23         (2)  An application for a license under this part must

24  be submitted to the department in on such form forms as the

25  department may prescribe by rule.  If the department

26  determines that an application should be granted, it shall

27  issue the license for a period not to exceed 2 years.  A

28  nonrefundable application fee of $175 not exceeding $200 shall

29  be set by rule and accompany an initial application for the

30  principal place of business and each application for a branch

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  1  location of a retail installment seller who is required to be

  2  licensed under this chapter.

  3         (3)  The A renewal fee for a motor vehicle retail

  4  installment seller license shall be $175 not exceeding $200

  5  shall be set by rule.  The department shall establish by rule

  6  biennial licensure periods and procedures for renewal of

  7  licenses may also be established by the department by rule.  A

  8  license that is not renewed by at the end of the biennium

  9  established by the department shall automatically expire and

10  revert from active to inactive status.  An Such inactive

11  license may be reactivated within 6 months after becoming

12  inactive the expiration date upon filing submission of a

13  completed reactivation form, payment of the renewal

14  application fee, and payment of a reactivation fee equal to

15  the renewal application fee.  A license that is not

16  reactivated within 6 months after becoming inactive

17  automatically expires may not be reactivated.

18         (4)  Each license shall must specify the location for

19  which it is issued and must be conspicuously displayed at that

20  location. Prior to relocating a principal place of business or

21  any branch location, the licensee must provide to the

22  department notice of the relocation in a form prescribed by

23  department rule. If a licensee's principal place of business

24  or branch location changes, the licensee shall notify the

25  department and the department shall endorse the change of

26  location without charge. A licensee may not transact business

27  as a motor vehicle retail installment seller except under the

28  name by which it is licensed. Licenses issued under this part

29  are not transferable or assignable.

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  1         Section 8.  Paragraph (a) of subsection (2) and

  2  subsections (3) and (8) of section 520.07, Florida Statutes,

  3  are amended to read:

  4         520.07  Requirements and prohibitions as to retail

  5  installment contracts.--

  6         (2)  The contract shall contain the following:

  7         (a)  Amount financed.--The "amount financed," using

  8  that term, and a brief description such as "the amount of

  9  credit provided to you or on your behalf."  The amount

10  financed is calculated by:

11         1.  Determining the cash price, and subtracting any

12  down payment;

13         2.  Adding any other amounts that are financed by the

14  creditor and that are not part of the finance charge,

15  including any additional amount financed in a retail

16  installment contract to discharge a security interest, lien,

17  or lease interest on a motor vehicle traded in connection with

18  the contract; and

19         3.  Subtracting any prepaid finance charge.

20

21  Except for the requirement in subsection (3) that a separate

22  written itemization of the amount financed be provided, a

23  contract which complies with the federal Truth in Lending Act,

24  15 U.S.C. ss. 1601 et seq., or any accompanying regulations

25  shall be deemed to comply with the provisions of this

26  subsection and subsection (3). However, in any proceeding to

27  enforce the provisions of this section, the burden of alleging

28  and proving compliance with the federal Truth in Lending Act

29  shall be on the party claiming compliance.

30

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  1         (3)  The seller shall provide a separate written

  2  itemization of the amount financed, which itemization shall

  3  disclose the following:

  4         (a)  The cash price;

  5         (b)  The amount of down payment;

  6         (c)  The difference between the amounts disclosed under

  7  paragraphs (a) and (b);

  8         (d)  The amounts, if any, included for insurance and

  9  other benefits, specifying the types of coverages and

10  benefits; and

11         (e)  Any taxes and official fees not included in the

12  cash price; and

13         (f)  The number of scheduled payments, the amount of

14  each payment, and the date of the first payment.

15

16  The itemization required by this subsection may appear on a

17  disclosure statement separate from all other material, or it

18  may be placed on the same document with the contract or other

19  information so long as it is clearly and conspicuously

20  segregated from everything else on the document.

21         (8)(a)  Upon written request from the buyer, the holder

22  of a retail installment contract shall give or forward to the

23  buyer a written statement of the dates and amounts of payments

24  and the total amount unpaid under such contract.  A buyer

25  shall be given a written receipt for any payment when made in

26  cash.

27         (b)  When a motor vehicle retail installment contract

28  is paid in full, the holder shall ensure that the contract or

29  title reflects that the lien has been satisfied or released

30  and shall ensure that evidence of satisfaction is provided to

31  the borrower or payor.

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  1         Section 9.  Section 520.085, Florida Statutes, is

  2  amended to read:

  3         520.085  Simple-interest contracts.--

  4         (1)  A retail installment contract under The Motor

  5  Vehicle Retail Sales Finance Act may provide that the rate of

  6  finance charge be calculated on a simple-interest basis

  7  subject to the following provisions:

  8         (a)(1)  Instead of a finance charge computed on the

  9  amount financed as determined under s. 520.07(2), the seller

10  may compute the finance charge at a simple-interest rate

11  equivalent to the finance charge permitted by s. 520.08 on the

12  unpaid balance as it changes from time to time or by any other

13  method. For the purposes of this section, the class of motor

14  vehicle shall be determined at the time of execution of the

15  retail installment contract.

16         (b)(2)  The language in s. 520.08(2) which provides

17  that the finance charge may be computed on the basis of a full

18  month for any fractional-month period in excess of 10 days

19  shall not be applicable to a simple-interest contract.

20         (c)(3)  The provisions of s. 520.09 which prescribe a

21  refund credit upon prepayment in full before maturity of the

22  unpaid balance of a retail installment contract shall not be

23  applicable to a simple-interest contract. However, the lender

24  may impose an acquisition charge, not to exceed $75, for

25  services performed on behalf of the borrower for processing

26  the retail installment contract if the contract is paid in

27  full within 6 months after the effective date of the contract.

28         (d)(4)  In the event the unpaid balance of a retail

29  installment contract is extended, deferred, renewed, or

30  restated, the holder may compute the refinance charge in

31  accordance with the provisions of this section.

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  1         (e)(5)  Notwithstanding any provisions of The Motor

  2  Vehicle Retail Sales Finance Act or any other law to the

  3  contrary, the finance charge percentage rate included in a

  4  retail installment sale contract representing the sale of a

  5  motor vehicle primarily for business or commercial use may

  6  vary, but no higher than the limits set forth in s. 520.08,

  7  during the term of the contract pursuant to a formula or index

  8  set forth therein (such as a prime rate or commercial paper

  9  rate quoted by one or more banking institutions or the highest

10  prime rate reported effective on the date in question by The

11  Wall Street Journal) that is made readily available to and

12  verifiable by the buyer and is beyond the control of the

13  holder of the contract.  For the purpose of disclosing the

14  amount of finance charge and time balance and setting forth a

15  payment schedule of equal successive monthly installments,

16  such amounts may be calculated using the finance charge

17  percentage rate applicable to the transaction as of the date

18  of execution of the contract, notwithstanding the fact that

19  such finance charge percentage may increase or decrease over

20  the term of the contract according to a formula or index set

21  forth in the contract.

22         (2)  The holder of a simple interest contract, upon the

23  request of the buyer, may defer the scheduled due date of all

24  or any part of any installment payment, and may collect a $15

25  fee for such deferment. The holder may also require the buyer

26  to extend any insurance coverage required by the simple

27  interest contract, or require the buyer to reimburse the

28  holder for any costs incurred by the holder for extending such

29  coverage. With the buyer's approval, the holder may extend any

30  optional insurance coverage purchased in connection with the

31  simple interest contract and may charge the buyer for the

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  1  costs of extending such optional insurance. A holder may not

  2  collect the $15 deferment fee unless this deferment option was

  3  provided for in the simple interest contract. The holder shall

  4  disclose in the simple interest contract and any offer to

  5  exercise the deferment option that, in addition to the $15

  6  deferment fee and the costs of extending required or optional

  7  insurance, the buyer will also be required to pay additional

  8  finance charges as a result of exercising the deferment

  9  option.

10         Section 10.  Present subsections (1) through (8) of

11  section 520.31, Florida Statutes, are renumbered as

12  subsections (2) through (9), respectively, present subsections

13  (9) through (15) of that section are renumbered as subsections

14  (11) through (17), respectively, and new subsections (1) and

15  (10) are added to that section, to read:

16         520.31  Definitions.--Unless otherwise clearly

17  indicated by the context, the following words when used in

18  this act, for the purposes of this act, shall have the

19  meanings respectively ascribed to them in this section:

20         (1)  "Branch" means any location, other than a

21  licensee's principal place of business, at which a licensee

22  operates or conducts business under this act or which a

23  licensee owns or controls for the purpose of conducting

24  business under this act.

25         (10)  "Principal place of business" means the physical

26  location designated on the licensee's application for

27  licensure, unless otherwise designated as required by this

28  chapter.

29         Section 11.  Subsections (2) and (3) of section 520.32,

30  Florida Statutes, are amended to read:

31         520.32  Licenses.--

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  1         (2)  An application for a license under this part must

  2  be submitted to the department in on such form forms as the

  3  department may prescribe by rule.  If the department

  4  determines that an application should be granted, it shall

  5  issue the license for a period not to exceed 2 years.  A

  6  nonrefundable application fee of $175 not exceeding $200 shall

  7  be set by rule and accompany an initial application for the

  8  principal place of business and each application for a branch

  9  location of a retail installment seller.

10         (3)  The A renewal fee for a retail seller license

11  shall be $175 not exceeding $200 shall be set by rule.

12  Biennial licensure periods and procedures for renewal of

13  licenses may also be established by the department by rule.  A

14  license that is not renewed at the end of the biennium

15  established by the department shall automatically expire and

16  revert from active to inactive status.  An Such inactive

17  license may be reactivated within 6 months after becoming

18  inactive the expiration date upon filing submission of a

19  completed reactivation form, payment of the renewal

20  application fee, and payment of a reactivation fee equal to

21  the renewal application fee.  A license that is not

22  reactivated within 6 months after becoming inactive

23  automatically expires may not be reactivated.

24         Section 12.  Subsection (14) is added to section

25  520.34, Florida Statutes, to read:

26         520.34  Retail installment contracts.--

27         (14)  The seller under a retail installment contract

28  may collect a $10 processing fee for each retail installment

29  contract that is approved and activated. Such processing fee

30  shall not be considered interest or finance charges pursuant

31  to chapter 687.

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  1         Section 13.  Subsections (2) and (3) of section 520.52,

  2  Florida Statutes, are amended to read:

  3         520.52  Licensees.--

  4         (2)  An application for a license under this part must

  5  be submitted to the department in on such form forms as the

  6  department may prescribe by rule.  If the department

  7  determines that an application should be granted, it shall

  8  issue the license for a period not to exceed 2 years.  A

  9  nonrefundable application fee of $175 not exceeding $200 shall

10  be set by rule and accompany an initial application for the

11  principal place of business and each branch location of a

12  sales finance company.

13         (3)  The A renewal fee for a sales finance company

14  license shall be $175 not exceeding $200 shall be set by rule.

15  Biennial licensure periods and procedures for renewal of

16  licenses may also be established by the department by rule.  A

17  license that is not renewed at the end of the biennium

18  established by the department shall automatically expire and

19  revert from active to inactive status.  An Such inactive

20  license may be reactivated within 6 months after becoming

21  inactive the expiration date upon filing submission of a

22  completed reactivation form, payment of the renewal

23  application fee, and payment of a reactivation fee equal to

24  the renewal application fee.  A license that is not

25  reactivated within 6 months after becoming inactive

26  automatically expires may not be reactivated.

27         Section 14.  Present subsections (2) through (17) of

28  section 520.61, Florida Statutes, are renumbered as

29  subsections (3) through (18), respectively, present

30  subsections (18) and (19) of that section are renumbered as

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  1  subsections (20) and (21), respectively, and new subsections

  2  (2) and (19) are added to that section, to read:

  3         520.61  Definitions.--As used in this act:

  4         (2)  "Branch" means any location, other than a

  5  licensee's principal place of business, at which a licensee

  6  operates or conducts business under this act or which a

  7  licensee owns or controls for the purpose of conducting

  8  business under this act.

  9         (19)  "Principal place of business" means the physical

10  location designated on the licensee's application for

11  licensure, unless otherwise designated as required by this

12  chapter.

13         Section 15.  Subsections (2) and (3) of section 520.63,

14  Florida Statutes, are amended to read:

15         520.63  Licensees.--

16         (2)  An application for a license under this part must

17  be submitted to the department in on such form forms as the

18  department may prescribe by rule.  If the department

19  determines that an application should be granted, it shall

20  issue the license for a period not to exceed 2 years.  A

21  nonrefundable application fee of $175 not exceeding $200 shall

22  be set by rule and accompany an initial application for the

23  principal place of business and each application for a branch

24  location of a home improvement finance seller.

25         (3)  The A renewal fee for a home improvement finance

26  license shall be $175 not exceeding $200 shall be set by rule.

27  Biennial licensure periods and procedures for renewal of

28  licenses may also be established by the department by rule.  A

29  license that is not renewed at the end of the biennium

30  established by the department shall automatically expire and

31  revert from active to inactive status.  An Such inactive

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  1  license may be reactivated within 6 months after becoming

  2  inactive the expiration date upon filing submission of a

  3  completed reactivation form, payment of the renewal

  4  application fee, and payment of a reactivation fee equal to

  5  the renewal application fee.  A license that is not

  6  reactivated within 6 months after becoming inactive

  7  automatically expires may not be reactivated.

  8         Section 16.  Subsection (5) of section 520.994, Florida

  9  Statutes, 1998 Supplement, is amended to read:

10         520.994  Powers of department.--

11         (5)  The department shall administer and enforce this

12  chapter. The department has authority to adopt rules pursuant

13  to ss. 120.536(1) and 120.54 to implement the provisions of

14  this chapter. The department may adopt rules to allow

15  electronic submission of any form, document, or fee required

16  by this act.

17         Section 17.  Subsections (1) and (3) of section

18  520.995, Florida Statutes, are amended to read:

19         520.995  Grounds for disciplinary action.--

20         (1)  The following acts are violations of this chapter

21  and constitute grounds for the disciplinary actions specified

22  in subsection (2):

23         (a)  Failure to comply with any provision of this

24  chapter, any rule or order adopted pursuant to this chapter,

25  or any written agreement entered into with the department;

26         (b)  Fraud, misrepresentation, deceit, or gross

27  negligence in any home improvement finance transaction or

28  retail installment transaction, regardless of reliance by or

29  damage to the buyer or owner;

30         (c)  Fraudulent misrepresentation, circumvention, or

31  concealment of any matter required to be stated or furnished

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  1  to a retail buyer or owner pursuant to this chapter,

  2  regardless of reliance by or damage to the buyer or owner;

  3         (d)  Willful imposition of illegal or excessive charges

  4  in any retail installment transaction or home improvement

  5  finance transaction;

  6         (e)  False, deceptive, or misleading advertising by a

  7  seller or home improvement finance seller;

  8         (f)  Failure to maintain, preserve, and keep available

  9  for examination, all books, accounts, or other documents

10  required by this chapter, by any rule or order adopted

11  pursuant to this chapter, or by any agreement entered into

12  with the department;

13         (g)  Refusal to permit inspection of books and records

14  in an investigation or examination by the department or

15  refusal to comply with a subpoena issued by the department; or

16         (h)  Criminal conduct in the course of a person's

17  business as a seller, as a home improvement finance seller, or

18  as a sales finance company; or

19         (i)  Failure to timely pay any fee, charge, or fine

20  imposed or assessed pursuant to this chapter or any rule

21  adopted under this chapter.

22         (3)  In addition to the acts specified in subsection

23  (1), the following shall be grounds for denial of a license

24  pursuant to this chapter, or for revocation, suspension, or

25  restriction of a license previously granted:

26         (a)  A material misstatement of fact in an initial or

27  renewal application for a license;

28         (b)  Having a license, registration, or the equivalent,

29  to practice any profession or occupation denied, suspended,

30  revoked, or otherwise acted against by a licensing authority

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  1  in any jurisdiction for fraud, dishonest dealing, or any act

  2  of moral turpitude;

  3         (c)  Pleading nolo contendere to, or having been

  4  convicted or found guilty of, a crime involving fraud,

  5  dishonest dealing, or any act of moral turpitude, regardless

  6  of whether adjudication is withheld; or

  7         (d)  Being insolvent or having a demonstrated lack of

  8  honesty or financial responsibility.

  9         Section 18.  Effective January 1, 2001, subsection (1)

10  of section 520.996, Florida Statutes, is amended to read:

11         520.996  Investigations and complaints.--

12         (1)(a)  The department or its agent may, at

13  intermittent periods, make such investigations and

14  examinations of any licensee or other person as it deems

15  necessary to determine compliance with this chapter.  For such

16  purposes, it may examine the books, accounts, records, and

17  other documents or matters of any licensee or other person. It

18  shall have the power to compel the production of all relevant

19  books, records, and other documents and materials relative to

20  an examination or investigation.  Such investigations and

21  examinations shall not be made more often than once during any

22  12-month period unless the department has good and sufficient

23  reason to believe the licensee is not complying with the

24  provisions of this chapter.  The expenses of the department

25  incurred in each such examination may be established by

26  department rule but shall not exceed $250 per 8-hour day for

27  each examiner.  Such examination fee shall be calculated on an

28  hourly basis and shall be rounded to the nearest hour.

29         (b)  The department shall conduct all examinations at a

30  convenient location in this state unless the department

31  determines that it is more effective or cost-efficient to

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  1  perform an examination at the licensee's out-of-state

  2  location. For an examination performed at the licensee's

  3  out-of-state location, the licensee shall also pay the travel

  4  expense and per diem subsistence at the rate provided by law

  5  for up to 30 eight-hour days per year for each examiner who

  6  participates in such an examination.  However, if the

  7  examination involves or reveals possible fraudulent conduct of

  8  the licensee, the licensee shall pay the travel expenses and

  9  per diem subsistence provided by law, without limitation, for

10  each participating examiner allowance provided for state

11  employees in s. 112.061. The licensee shall not be required to

12  pay a per diem fee and expenses of an examination which shall

13  consume more than 30 worker-days in any one year unless such

14  examination or investigation is due to fraudulent practices of

15  the licensee, in which case such licensee shall be required to

16  pay the entire cost regardless of time consumed.

17         Section 19.  Subsection (5) is added to section

18  520.997, Florida Statutes, to read:

19         520.997  Books, accounts, and records.--

20         (5)  A licensee that is the subject of a voluntary or

21  involuntary bankruptcy filing must provide notice of such

22  filing to the department within 7 days after the filing date.

23         Section 20.  Subsection (2) of section 559.9232,

24  Florida Statutes, is amended to read:

25         559.9232  Definitions; exclusion of rental-purchase

26  agreements from certain regulations.--

27         (2)  A rental-purchase agreement that complies with

28  this act shall not be construed to be, nor be governed by, any

29  of the following:

30

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  1         (a)  A lease or agreement which constitutes a credit

  2  sale as defined in 12 C.F.R. s. 226.2(a)(16) and s. 1602(g) of

  3  the federal Truth in Lending Act, 15 U.S.C. ss. 1601 et seq.;

  4         (b)  A lease which constitutes a "consumer lease" as

  5  defined in 12 C.F.R. s. 213.2(a)(6);

  6         (c)  Any lease for agricultural, business, or

  7  commercial purposes;

  8         (d)  Any lease made to an organization;

  9         (e)  A lease or agreement which constitutes a "retail

10  installment contract" or "retail installment transaction" as

11  those terms are defined in s. 520.31(12) s. 520.31(10) and

12  (13) (11); or

13         (f)  A security interest as defined in s. 671.201(37).

14         Section 21.  Subsection (19) of section 681.102,

15  Florida Statutes, 1998 Supplement, is amended to read:

16         681.102  Definitions.--As used in this chapter, the

17  term:

18         (19)  "Purchase price" means the cash price as defined

19  in s. 520.31(2) s. 520.31(1), inclusive of any allowance for a

20  trade-in vehicle, but excludes debt from any other

21  transaction. "Any allowance for a trade-in vehicle" means the

22  net trade-in allowance as reflected in the purchase contract

23  or lease agreement if acceptable to the consumer and

24  manufacturer.  If such amount is not acceptable to the

25  consumer and manufacturer, then the trade-in allowance shall

26  be an amount equal to 100 percent of the retail price of the

27  trade-in vehicle as reflected in the NADA Official Used Car

28  Guide (Southeastern Edition) or NADA Recreation Vehicle

29  Appraisal Guide, whichever is applicable, in effect at the

30  time of the trade-in.  The manufacturer shall be responsible

31  for providing the applicable NADA book.

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  1         Section 22.  Subsection (4) of section 697.05, Florida

  2  Statutes, is amended to read:

  3         697.05  Balloon mortgages; scope of law; definition;

  4  requirements as to contents; penalties for violations;

  5  exemptions.--

  6         (4)  This section does not apply to the following:

  7         (a)  Any mortgage in effect prior to January 1, 1960;

  8         (b)  Any first mortgage, excluding a mortgage in favor

  9  of a home improvement contractor defined in s. 520.61(12) s.

10  520.61(11) the execution of which is required solely by the

11  terms of a home improvement contract which is governed by the

12  provisions of ss. 520.60-520.992;

13         (c)  Any mortgage created for a term of 5 years or

14  more, excluding a mortgage in favor of a home improvement

15  contractor defined in s. 520.61(12) s. 520.61(11) the

16  execution of which is required solely by the terms of a home

17  improvement contract which is governed by the provisions of

18  ss. 520.60-520.992;

19         (d)  Any mortgage, the periodic payments on which are

20  to consist of interest payments only, with the entire original

21  principal sum to be payable upon maturity;

22         (e)  Any mortgage securing an extension of credit in

23  excess of $500,000;

24         (f)  Any mortgage granted in a transaction covered by

25  the federal Truth in Lending Act, 15 U.S.C. ss. 1601 et seq.,

26  in which each mortgagor thereunder is furnished a Truth in

27  Lending Disclosure Statement that satisfies the requirements

28  of the federal Truth in Lending Act; or

29         (g)  Any mortgage granted by a purchaser to a seller

30  pursuant to a written agreement to buy and sell real property

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  1  which provides that the final payment of said mortgage debt

  2  will exceed the periodic payments thereon.

  3         Section 23.  Except as otherwise expressly provided in

  4  this act, this act shall take effect October 1, 1999.

  5

  6          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  7                         Senate Bill 1264

  8

  9  Authorizes the Department of Banking and Finance to adopt
    rules to allow electronic submission of any form, document, or
10  fee required by chapters 516 or 520, F.S.

11  Requires that the calculation for the amount financed under a
    motor vehicle retail sales contract, and disclosed to the
12  borrower, include any additional amount that is financed to
    discharge a security interest, lien, or lease interest on a
13  motor vehicle that is traded in connection with the contract
    (typically referred to as "negative equity");
14
    Specifies that the $10 processing fee that may be charged by
15  the seller for each retail installment contract as authorized
    by SB 1264, shall not be considered interest or finance
16  charges pursuant to chapter 687, F.S.

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