| 1 | A bill to be entitled |
| 2 | An act relating to credit counseling services; amending s. |
| 3 | 817.801, F.S.; revising and providing definitions; |
| 4 | amending s. 817.802, F.S., relating to unlawful fees and |
| 5 | costs; limiting application to certain debtors; amending |
| 6 | s. 817.804, F.S.; revising annual audit requirements; |
| 7 | amending s. 817.805, F.S.; including creditor |
| 8 | contributions within an authorized deduction from |
| 9 | requirements for disbursement of funds; providing a |
| 10 | limitation on creditor contributions; providing an |
| 11 | effective date. |
| 12 |
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| 13 | Be It Enacted by the Legislature of the State of Florida: |
| 14 |
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| 15 | Section 1. Section 817.801, Florida Statutes, is amended |
| 16 | to read: |
| 17 | 817.801 Definitions.--As used in this part: |
| 18 | (1)(4) "Credit counseling agency" means any organization |
| 19 | providing debt management services or credit counseling |
| 20 | services. |
| 21 | (2)(1) "Credit counseling services" means confidential |
| 22 | money management, debt reduction, and financial educational |
| 23 | services. |
| 24 | (3) "Creditor contribution" means any sum that a creditor |
| 25 | agrees to contribute to a credit counseling agency, whether |
| 26 | directly or by setoff against amounts otherwise payable to the |
| 27 | creditor on behalf of debtors. |
| 28 | (4)(2) "Debt management services" means services provided |
| 29 | to a debtor by a credit counseling organization for a fee to: |
| 30 | (a) Effect the adjustment, compromise, or discharge of any |
| 31 | unsecured account, note, or other indebtedness of the debtor; or |
| 32 | (b) Receive from the debtor and disburse to a creditor any |
| 33 | money or other thing of value. |
| 34 | (5)(3) "Person" means any individual, corporation, |
| 35 | partnership, trust, association, or other legal entity. |
| 36 | Section 2. Section 817.802, Florida Statutes, is amended |
| 37 | to read: |
| 38 | 817.802 Unlawful fees and costs.-- |
| 39 | (1) It is unlawful for any person, while engaging in debt |
| 40 | management services or credit counseling services, to charge or |
| 41 | accept from a debtor residing in this state, directly or |
| 42 | indirectly, a fee or contribution greater than $50 for the |
| 43 | initial setup or initial consultation. Subsequently, the person |
| 44 | may not charge or accept a fee or contribution from a debtor |
| 45 | residing in this state greater than $120 per year for additional |
| 46 | consultations or, alternatively, if debt management services as |
| 47 | defined in s. 817.801(4)(2)(b) are provided, the person may |
| 48 | charge the greater of 7.5 percent of the amount paid monthly by |
| 49 | the debtor to the person or $35 per month. |
| 50 | (2) No provision of This section does not prohibit |
| 51 | prohibits any person, while engaging in debt management or |
| 52 | credit counseling services, from imposing upon and receiving |
| 53 | from a debtor a reasonable and separate charge or fee for |
| 54 | insufficient funds transactions. |
| 55 | Section 3. Paragraph (a) of subsection (1) of section |
| 56 | 817.804, Florida Statutes, is amended to read: |
| 57 | 817.804 Requirements; disclosure and financial |
| 58 | reporting.-- |
| 59 | (1) Any person engaged in debt management services or |
| 60 | credit counseling services shall: |
| 61 | (a) Obtain from a licensed certified public accountant |
| 62 | licensed under s. 473.308 an annual audit in accordance with |
| 63 | generally accepted auditing standards that shall include of all |
| 64 | accounts of such person in which the funds of debtors are |
| 65 | deposited and from which payments are made to creditors on |
| 66 | behalf of debtors. |
| 67 | Section 4. Section 817.805, Florida Statutes, is amended |
| 68 | to read: |
| 69 | 817.805 Disbursement of funds.--Any person engaged in debt |
| 70 | management or credit counseling services shall disburse to the |
| 71 | appropriate creditors all funds received from a debtor, less any |
| 72 | fees permitted by s. 817.802 and any creditor contributions, |
| 73 | within 30 days after receipt of such funds. However, a creditor |
| 74 | contribution may not reduce any sums to be credited to the |
| 75 | account of a debtor making a payment to the credit counseling |
| 76 | agency for further payment to the creditor. Further, any person |
| 77 | engaged in such services shall maintain a separate trust account |
| 78 | for the receipt of any funds from debtors each debtor and the |
| 79 | disbursement of such funds on behalf of such debtors debtor. |
| 80 | Section 5. This act shall take effect July 1, 2006. |