Florida Senate - 2016 COMMITTEE AMENDMENT
Bill No. SB 1696
Ì704486DÎ704486
LEGISLATIVE ACTION
Senate . House
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The Committee on Banking and Insurance (Richter) recommended the
following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Section 516.40, Florida Statutes, is created to
6 read:
7 516.40 Access to Responsible Credit Pilot Program.—
8 (1) There is created within the Office of Financial
9 Regulation the Access to Responsible Credit Pilot Program.
10 (2) The Legislature finds that demand for responsible
11 consumer finance loans in principal amounts of at least $300 and
12 no more than $3,000 exceeds the supply of these loans. As a
13 first step toward addressing this gap, the Access to Responsible
14 Credit Pilot Program would allow more Floridians to obtain
15 responsible consumer finance loans of at least $300 and no more
16 than $3,000. The pilot program is also intended to assist
17 consumers in building their credit and has additional consumer
18 protections for these loans which exceed current protections
19 under general law.
20 Section 2. Section 516.41, Florida Statutes, is created to
21 read:
22 516.41 Definitions.—As used in ss. 516.40-516.46, the term:
23 (1) “Consumer reporting agency” has the same meaning as in
24 s. 603(p) of the Fair Credit Reporting Act, 15 U.S.C. s.
25 1681a(p).
26 (2) “Credit score” has the same meaning as in s.
27 609(f)(2)(A) of the Fair Credit Reporting Act, 15 U.S.C. s.
28 1681g(f)(2)(A).
29 (3) “Data furnisher” has the same meaning as the term
30 “furnisher” in 12 C.F.R. s. 1022.41(c).
31 (4) “Pilot program” or “program” means the Access to
32 Responsible Credit Pilot Program.
33 (5) “Pilot program license” means a permit issued under ss.
34 516.40-516.46 authorizing a program licensee to make and collect
35 pilot program loans.
36 (6) “Program branch office license” means a location, other
37 than a program licensee’s or referral partner’s principal place
38 of business:
39 (a) The address of which appears on business cards,
40 stationery, or advertising used by the program licensee in
41 connection with business conducted under this chapter;
42 (b) At which the program licensee’s name, advertising or
43 promotional materials, or signage suggests that program loans
44 are originated, negotiated, funded, or serviced; or
45 (c) At which program loans are originated, negotiated,
46 funded, or serviced by a program licensee.
47 (7) “Program licensee” means a person who is licensed to
48 make and collect program loans under this chapter and who is
49 approved by the office to participate in the program.
50 (8) “Program loan” means a consumer finance loan with a
51 principal amount of at least $300 and no more than $3,000.
52 (9) “Referral partner” means an entity that, at the
53 referral partner’s physical location for business, performs one
54 or more of the permitted services in s. 516.44(2) on behalf of a
55 program licensee. A referral partner is not a credit service
56 organization as defined in s. 817.7001 or a loan broker as
57 defined in s. 687.14.
58 (10) “Refinance program loan” means a program loan that
59 extends additional principal to a borrower and replaces and
60 revises an existing program loan contract with the borrower. A
61 refinance program loan does not include an extension, a
62 deferral, or a rewrite of the program loan.
63 Section 3. Section 516.42, Florida Statutes, is created to
64 read:
65 516.42 Approval required; program application requirements;
66 fees.—
67 (1) A program licensee may not offer or make a program
68 loan, or impose any charges or fees pursuant to s. 516.43,
69 without prior approval from the office to participate in the
70 program.
71 (2)(a) In order to participate in the program, a person
72 must:
73 1. Be licensed to make consumer finance loans under s.
74 516.05.
75 2. Not be the subject of any insolvency proceedings.
76 3. Not be subject to the issuance of a cease and desist
77 order; the issuance of a removal order; the denial, suspension,
78 or revocation of a license; or any other action within the
79 authority of the office or any financial regulatory agency in
80 this state; or must not have a deficiency at the time of the
81 person’s application.
82 4. Pay a nonrefundable application fee of $1,000 to the
83 office at the time of making the application pursuant to rule of
84 the commission.
85 (b) The applicant must file with the office a digital
86 application in a form and manner prescribed by rule of the
87 commission which contains all of the following information with
88 respect to the program applicant:
89 1. The legal business name and any other name the applicant
90 operates under other than the legal business name.
91 2. The applicant’s main address.
92 3. The telephone number and e-mail address.
93 4. The address of each program branch office.
94 5. The contact person’s name, title, address, telephone
95 number, and e-mail address.
96 6. The license number, if licensed under this chapter.
97 7. A statement as to whether the applicant intends to use
98 the services of one or more referral partners under s. 516.44.
99 8. A statement that the applicant has been accepted as a
100 data furnisher by a consumer reporting agency and will report to
101 a consumer reporting agency the payment performance of each
102 borrower on all loans made under this program.
103 9. The signature and certification of an authorized person
104 of the applicant.
105 (3) A program licensee who desires to participate in the
106 program but who is not licensed to make consumer finance loans
107 pursuant to s. 516.05 must submit concurrently the following two
108 digital applications to the office, in a form and manner
109 specified in this chapter:
110 (a) An application and a fee pursuant to s. 516.03 for
111 licensure to make consumer finance loans; and
112 (b) An application and a fee for admission to the program
113 in accordance with subsection (2).
114 (4) Except as otherwise provided in ss. 516.40-516.46, a
115 program licensee is subject to all the laws and rules governing
116 consumer finance loans under this chapter.
117 (5) All program licensees shall be assessed a nonrefundable
118 biennial renewal fee of $1,000 pursuant to rule of the
119 commission.
120 (6) Notwithstanding s. 516.05(3), only one pilot program
121 license is required for a person to make program loans under ss.
122 516.40-516.46, regardless of whether the program licensee offers
123 program loans to prospective borrowers at its own physical
124 business locations, through referral partners, or via an
125 electronic access point through which a prospective borrower may
126 directly access the website of the program licensee.
127 (7) Each branch office of a program licensee must be
128 licensed under this section.
129 (8) The office shall issue a program branch office license
130 to a program licensee after the office determines that the
131 program licensee has submitted a completed electronic
132 application for a program branch office license in a form
133 prescribed by rule of the commission and payment of an initial
134 nonrefundable program branch office license fee of $30 per
135 branch office as prescribed by rule of the commission.
136 Application fees may not be prorated for partial years of
137 licensure. The program branch office license shall be issued in
138 the name of the program licensee that maintains the branch
139 office. An application is considered received for purposes of s.
140 120.60 upon receipt of a completed application form and the
141 required fees. The application for a program branch office
142 license must contain the following information:
143 (a) The legal business name and any other name the
144 applicant operates under other than the legal business name.
145 (b) The applicant’s main address.
146 (c) The telephone number and e-mail address.
147 (d) The address of each program branch office.
148 (e) The contact person’s name, title, address, telephone
149 number and e-mail address.
150 (f) The license number, if licensed under this chapter.
151 (g) The signature and certification of an authorized person
152 of the applicant.
153 (9) A program branch office license must be renewed
154 biennially at the time of renewing the program license under
155 subsection (5). A nonrefundable branch renewal fee of $30 per
156 program branch office, by rule of the commission, must be
157 submitted at the time of renewal.
158 Section 4. Section 516.43, Florida Statutes, is created to
159 read:
160 516.43 Requirements for program loans.—
161 (1) GENERAL REQUIREMENTS.—A program licensee must comply
162 with each of the following requirements in making program loans:
163 (a) A program loan must be unsecured.
164 (b) A program loan must have a minimum term of 120 days,
165 except it may not have a prepayment penalty.
166 (c) A program loan must be repayable by the borrower in
167 substantially equal weekly, biweekly, semimonthly, or monthly
168 installments.
169 (d) A program loan must include a borrower’s right to
170 rescind the program loan by notifying the program licensee of
171 the borrower’s intent to rescind the program loan and return the
172 principal advanced by the end of the business day after the day
173 the program loan is consummated.
174 (e) Notwithstanding s. 516.031, the interest rate charged
175 on a program loan to the borrower may not exceed 34 percent. The
176 interest rate must be fixed for the life of the program loan and
177 must accrue on a simple-interest basis through the application
178 of a daily periodic rate to the actual unpaid principal balance
179 each day.
180 (f) The program licensee shall reduce the rate on each
181 subsequent program loan to the same borrower by a minimum of
182 one-twelfth of 1 percent per month, if all of the following
183 conditions are met:
184 1. The subsequent program loan is originated no more than
185 180 days after the prior program loan is fully repaid.
186 2. The borrower was never more than 15 days delinquent on
187 the prior program loan.
188 3. The prior program loan was outstanding for at least one
189 half of its original term prior to its repayment.
190 (g) A program licensee may not refinance a program loan
191 unless all of the following conditions are met at the time the
192 borrower submits an application to refinance:
193 1. The principal amount payable may not include more than
194 60 days’ unpaid interest accrued on the previous program loan in
195 accordance with s. 516.031(5);
196 2. The borrower has repaid at least 60 percent of the
197 outstanding principal remaining on his or her existing program
198 loan;
199 3. The borrower is current on his or her outstanding
200 program loan;
201 4. The program licensee must underwrite the new program
202 loan in accordance with subsection (7); and
203 5. The borrower has not previously refinanced the
204 outstanding program loan.
205 (h) In lieu of the provisions of s. 687.08, a program
206 licensee or its approved referral partner, if applicable, must
207 make available to the borrower by electronic or physical means,
208 at the time that a payment is made by the borrower, a plain and
209 complete receipt of payment. For audit purposes, a program
210 licensee must maintain an electronic record for each receipt
211 made available to a borrower, which must include a copy of the
212 receipt and the date and time that the receipt was generated.
213 Each receipt of payment must show all of the following:
214 1. The name of the borrower.
215 2. The name of the referral partner, if applicable.
216 3. The total payment amount received.
217 4. The date of payment.
218 5. The program loan balance before and after application of
219 the payment.
220 6. The amount of the payment that was applied to the
221 principal, interest, and fees.
222 7. The type of payment made by the borrower.
223 8. The following statement, prominently displayed in a type
224 size equal to or greater than the type size used to display the
225 other items on the receipt: “If you have any questions about
226 your loan now or in the future, you should direct those
227 questions to ...(name of program licensee)... by ...(at least
228 two different ways in which a borrower may contact the program
229 licensee)....”
230 (2) WRITTEN DISCLOSURES.—
231 (a) Notwithstanding s. 516.15(1), the loan contract and all
232 written disclosures and statements may be provided in English or
233 another language in which the loan is negotiated.
234 (b) A program licensee must provide those disclosures
235 required by all licensees in s. 516.15.
236 (3) ORIGINATION FEES.—
237 (a) Notwithstanding s. 516.031, a program licensee may
238 contract for and receive a nonrefundable origination fee from a
239 borrower on a program loan. The program licensee may either
240 deduct the origination fee from the principal amount of the loan
241 disbursed to the borrower or capitalize the origination fee into
242 the principal balance of the loan. The origination fee is fully
243 earned immediately and nonrefundable upon making the program
244 loan in an amount not to exceed 6 percent of the principal
245 amount exclusive of the origination fee or $75, whichever is
246 less, on a program loan made to that borrower.
247 (b) A program licensee may not charge the same borrower an
248 origination fee more than twice in any 12-month period.
249 (4) INSUFFICIENT FUNDS FEES AND DELINQUENCY CHARGES.
250 Notwithstanding s. 516.031, a program licensee approved by the
251 office to participate in the program may:
252 (a) Require payment from a borrower of no more than $25 for
253 fees incurred by the program licensee from a dishonored payment
254 due to insufficient funds of the borrower.
255 (b) Notwithstanding s. 516.031(3)(a)9., contract for and
256 receive a delinquency charge of no more than $14 for each
257 payment in default for at least 7 days if the charge is agreed
258 upon in writing between the parties before imposing the charge.
259 A delinquency fee imposed by a program licensee is subject to
260 all of the following:
261 1. No more than one delinquency fee may be imposed per
262 delinquent payment.
263 2. No more than two delinquency fees may be imposed during
264 a period of 30 consecutive days.
265 3. The program licensee or any wholly owned subsidiary of
266 the program licensee may not sell or assign an unpaid debt to an
267 independent third party for collection purposes unless the debt
268 has been delinquent for at least 30 days.
269 (5) CREDIT EDUCATION.—Before disbursement of program loan
270 proceeds to the borrower, the program licensee must:
271 (a) Direct the borrower to the consumer credit counseling
272 services offered by an independent third party; or
273 (b) Provide a credit education program or materials to the
274 borrower. The borrower may not be required to participate in any
275 of these education programs or seminars. A credit education
276 program or seminar offered pursuant to this subsection must be
277 provided at no cost to the borrower.
278 (6) CREDIT REPORTING.—
279 (a) The program licensee must report each borrower’s
280 payment performance to at least one consumer reporting agency
281 that compiles and maintains files on consumers on a nationwide
282 basis. As used in this section, the term “consumer reporting
283 agency that compiles and maintains files on consumers on a
284 nationwide basis” has the same meaning as in s. 603(p) of the
285 Fair Credit Reporting Act, 15 U.S.C. s. 1681a(p).
286 (b) The office may not approve a licensee for the program
287 before the licensee has been accepted as a data furnisher by a
288 consumer reporting agency.
289 (c) The program licensee must provide each borrower with
290 the name or names of the consumer reporting agency or agencies
291 to which it will report the borrower’s payment history.
292 (7) PROGRAM LOAN UNDERWRITING.—
293 (a) The program licensee shall underwrite each program loan
294 to determine a borrower’s ability and willingness to repay the
295 program loan pursuant to the program loan terms. The program
296 licensee may not make a program loan if it determines that the
297 borrower’s total monthly debt service payments at the time of
298 origination, including the program loan for which the borrower
299 is being considered and all outstanding forms of credit that can
300 be independently verified by the program licensee, exceed 50
301 percent of the borrower’s gross monthly income.
302 (b)1. The program licensee shall seek information and
303 documentation pertaining to all of a borrower’s outstanding debt
304 obligations during the loan application and underwriting
305 process, including loans that are self-reported by the borrower
306 but not available through independent verification. The program
307 licensee shall verify that information using a credit report
308 from at least one consumer reporting agency that compiles and
309 maintains files on consumers on a nationwide basis or through
310 other available electronic debt verification services that
311 provide reliable evidence of a borrower’s outstanding debt
312 obligations.
313 2. The program licensee is not required to consider a
314 borrower’s loans from friends or family for purposes of
315 determining the borrower’s debt-to-income ratio.
316 (c) The program licensee shall also verify the borrower’s
317 income to determine the debt-to-income ratio using information
318 from:
319 1. Electronic means or services that provide reliable
320 evidence of the borrower’s actual income; or
321 2. Internal Revenue Service Form W-2, tax returns, payroll
322 receipts, bank statements, or other third-party documents that
323 provide reasonably reliable evidence of the borrower’s actual
324 income.
325 (8) PROVISIONS ON WAIVERS.—
326 (a) A program licensee may not require, as a condition of
327 providing the program loan, that the borrower:
328 1. Waive any right, penalty, remedy, forum, or procedure
329 provided for in any law applicable to the program loan,
330 including the right to file and pursue a civil action or file a
331 complaint with or otherwise communicate with the office, any
332 court, or other governmental entity.
333 2. Agree to the application of laws other than those of
334 this state.
335 3. Agree to resolve disputes in a jurisdiction outside of
336 this state.
337 (b) A waiver by a borrower, other than one prohibited under
338 paragraph (a), must be knowing, voluntary, in writing, and not
339 expressly made a condition of doing business with the program
340 licensee. A waiver that is required as a condition of doing
341 business with the program licensee is presumed involuntary,
342 unconscionable, against public policy, and unenforceable. The
343 program licensee has the burden of proving that a waiver of any
344 rights, penalties, forums, or procedures was knowing, voluntary,
345 and not expressly made a condition of the contract with the
346 borrower.
347 (c) A program licensee may not refuse to do business with
348 or discriminate against a borrower or an applicant on the basis
349 that the borrower or applicant refuses to waive any right,
350 penalty, remedy, forum, or procedure, including the right to
351 file and pursue a civil action or complaint with, or otherwise
352 notify, the office, a court, or any other governmental entity.
353 The exercise of a person’s right to refuse to waive any right,
354 penalty, remedy, forum, or procedure, including a rejection of a
355 contract requiring a waiver, does not affect any otherwise legal
356 terms of a contract or an agreement.
357 (d) This subsection does not apply to any agreement to
358 waive any right, penalty, remedy, forum, or procedure, including
359 any agreement to arbitrate a claim or dispute, after a claim or
360 dispute has arisen. This subsection does not affect the
361 enforceability or validity of any other provision of the
362 contract.
363 Section 5. Section 516.44, Florida Statutes, is created to
364 read:
365 516.44 Referral partners.—
366 (1) REFERRAL PARTNER AGREEMENT.—All arrangements between a
367 program licensee and a referral partner must be specified in a
368 written referral partner agreement between the parties. The
369 agreement must contain a provision that the referral partner
370 agrees to comply with this section and all rules adopted under
371 this section regarding the activities of referral partners, and
372 that the office has access to the referral partner’s books and
373 records pertaining to the referral partner’s operations under
374 the agreement with the program licensee in accordance with s.
375 516.45(4).
376 (2) PERMITTED SERVICES.—A program licensee may use the
377 services of one or more referral partners as provided in this
378 section. A referral partner may perform one or more of the
379 following services for a program licensee at the referral
380 partner’s physical business location:
381 (a) Distributing, circulating, using, or publishing printed
382 brochures, flyers, fact sheets, or other written materials
383 relating to program loans that the program licensee may make or
384 negotiate. The written materials must be reviewed and approved
385 in writing by the program licensee before being distributed,
386 circulated, or published.
387 (b) Providing written factual information about program
388 loan terms, conditions, or qualification requirements to a
389 prospective borrower which have either been prepared by the
390 program licensee or reviewed and approved in writing by the
391 program licensee. A referral partner may discuss the information
392 with a prospective borrower in general terms.
393 (c) Notifying a prospective borrower of the information
394 needed in order to complete a program loan application.
395 (d) Entering information provided by the prospective
396 borrower on a preprinted or an electronic application form or in
397 a preformatted computer database.
398 (e) Assembling credit applications and other materials
399 obtained in the course of a credit application transaction for
400 submission to the program licensee.
401 (f) Contacting the program licensee to determine the status
402 of a program loan application.
403 (g) Communicating a response that is returned by the
404 program licensee’s automated underwriting system to a borrower
405 or a prospective borrower.
406 (h) Obtaining a borrower’s signature on documents prepared
407 by the program licensee and delivering final copies of the
408 documents to the borrower.
409 (i) Disbursing program loan proceeds to a borrower if this
410 method of disbursement is acceptable to the borrower, subject to
411 the requirements of subsection (3). A loan disbursement made by
412 a referral partner under this paragraph is deemed to be made by
413 the program licensee on the date that the funds are disbursed or
414 otherwise made available by the referral partner to the
415 borrower.
416 (j) Receiving a program loan payment from the borrower if
417 this method of payment is acceptable to the borrower, subject to
418 the requirements of subsection (3).
419 (k) Operating an electronic access point through which a
420 prospective borrower may directly access the website of the
421 program licensee to apply for a program loan.
422 (3) RECEIPT OR DISBURSEMENT OF PROGRAM LOAN PAYMENTS.—
423 (a) A loan payment made by a borrower to a referral partner
424 under paragraph (2)(j) must be applied to the borrower’s program
425 loan and deemed received by the program licensee as of the date
426 the payment is received by the referral partner.
427 (b) A referral partner that receives loan payments must
428 deliver or cause to be delivered to the borrower, at the time
429 that the payment is made by the borrower, a plain and complete
430 receipt showing all of the information specified in s.
431 516.43(1)(g).
432 (c) A borrower who submits a loan payment to a referral
433 partner under this subsection is not liable for a failure or
434 delay by the referral partner in transmitting the payment to the
435 program licensee.
436 (d) A referral partner that disburses or receives loan
437 payments pursuant to paragraph (2)(i) or paragraph (2)(j) must
438 maintain records of all disbursements made and loan payments
439 received for a period of at least 2 years.
440 (4) PROHIBITED ACTIVITIES.—A referral partner may not
441 engage in any of the following activities:
442 (a) Providing counseling or advice to a borrower or
443 prospective borrower with respect to any loan term.
444 (b) Providing loan-related marketing material that has not
445 previously been approved by the program licensee to a borrower
446 or a prospective borrower.
447 (c) Negotiating a loan term between a program licensee and
448 a prospective borrower.
449 (d) Offering information pertaining to a single prospective
450 borrower to more than one program licensee, except if a program
451 licensee has declined to offer a program loan to a prospective
452 borrower and has so notified that prospective borrower in
453 writing, the referral partner may then offer information
454 pertaining to a single prospective borrower to another program
455 licensee with whom it has a referral partner agreement.
456 (e) Requiring a borrower to pay any fees or charges to the
457 referral partner or to any other person in connection with a
458 program loan other than those permitted under ss. 516.40-516.46.
459 (5) DISCLOSURE NOTICE AND COMMUNICATION.—
460 (a) At the time the referral partner receives or processes
461 an application for a program loan, the referral partner shall
462 provide the following statement to the applicant on behalf of
463 the program licensee, in no smaller than 10-point type, and must
464 request that the applicant acknowledge receipt of the statement
465 in writing:
466
467 Your loan application has been referred to us by
468 ...(name of referral partner).... We may pay a fee to
469 ...(name of referral partner)... for the successful
470 referral of your loan application. If you are approved
471 for the loan, ...(name of program licensee)... will
472 become your lender. If you have any questions about
473 your loan, now or in the future, you should direct
474 those questions to ...(name of program licensee)... by
475 ...(insert at least two different ways in which a
476 borrower may contact the program licensee).... If you
477 wish to report a complaint about ...(name of referral
478 partner)... or ...(name of program licensee)...
479 regarding this loan transaction, you may contact the
480 Division of Consumer Finance of the Office of
481 Financial Regulation at 850-487-9687 or
482 http://www.flofr.com.
483
484 (b) If the loan applicant has questions about the program
485 loan which the referral partner is not permitted to answer, the
486 referral partner shall make a good faith effort to assist the
487 applicant in making direct contact with the program licensee
488 before the program loan is consummated.
489 (c) If the program loan is consummated, the program
490 licensee must provide to the borrower a written copy of the
491 disclosure notice within 2 weeks after the date of the program
492 loan consummation. A program licensee may include the disclosure
493 in its loan contract or as a separate document to the borrower
494 via any means acceptable to the borrower.
495 (6) COMPENSATION.—
496 (a) The program licensee may compensate a referral partner
497 in accordance with a written agreement and a compensation
498 schedule that is mutually agreed to by the program licensee and
499 the referral partner, subject to the requirements in paragraph
500 (b).
501 (b) The compensation of a referral partner by a program
502 licensee is subject to all of the following requirements:
503 1. Compensation may not be paid to a referral partner in
504 connection with a loan application unless that program loan is
505 consummated.
506 2. Compensation may not be paid to a referral partner based
507 upon the principal amount of the program loan.
508 3. Compensation may not be directly or indirectly passed on
509 to a borrower through a fee or other compensation, or a portion
510 of a fee or other compensation charged to a borrower.
511 4. Subject to the limitations specified in subparagraphs
512 1., 2., and 3., the total compensation paid by a program
513 licensee to a referral partner for the services specified in
514 subsection (2) may not exceed the sum of:
515 a. Sixty dollars per program loan, on average, assessed
516 annually whether paid at the time of consummation, through
517 installments, or in a manner otherwise agreed upon by the
518 program licensee and the referral partner; and
519 b. Two dollars per payment received by the referral partner
520 on behalf of the program licensee for the duration of the
521 program loan, if the referral partner receives borrower loan
522 payments on the program licensee’s behalf in accordance with
523 subsection (3).
524 5. The referral partner’s location for services and other
525 information required by subsection (7) must be reported to the
526 office.
527 (c) Neither the program licensee nor any referral partner
528 may pass on to a borrower, whether directly or indirectly, any
529 additional cost or other charge for compensation paid to a
530 referral partner under this program.
531 (7) NOTICE TO OFFICE.—A program licensee that uses the
532 service of a referral partner must notify the office, in a form
533 and manner prescribed by the commission, within 15 days after
534 entering into a contract with a referral partner regarding all
535 of the following:
536 (a) The name, business address, and licensing details of
537 the referral partner and all locations at which the referral
538 partner will perform services under this section.
539 (b) The name and contact information for an employee of the
540 referral partner who is knowledgeable about, and has the
541 authority to execute, the referral partner agreement.
542 (c) The name and contact information of one or more
543 employees of the referral partner who are responsible for that
544 referral partner’s referring activities on behalf of the program
545 licensee.
546 (d) A statement by the program licensee that it has
547 conducted due diligence with respect to the referral partner and
548 has confirmed that none of the following applies:
549 1. The filing of a petition under the United States
550 Bankruptcy Code for bankruptcy or reorganization by the referral
551 partner.
552 2. The commencement of an administrative or a judicial
553 license suspension or revocation proceeding, or the denial of a
554 license request or renewal, by any state, the District of
555 Columbia, any United States territory, or any foreign country in
556 which the referral partner operates, plans to operate, or is
557 licensed to operate.
558 3. A felony indictment involving the referral partner or an
559 affiliated party. As used in this subparagraph, the term
560 “affiliated party” means a director, an officer, a responsible
561 person, an employee, or a foreign affiliate of a referral
562 partner; or a person who has a controlling interest in a
563 referral partner.
564 4. The felony conviction, guilty plea, or plea of nolo
565 contendere, regardless of adjudication, of the referral partner
566 or an affiliated party.
567 5. Any suspected criminal act perpetrated in this state
568 relating to activities regulated under this chapter by a
569 referral partner.
570 6. Notification by a law enforcement or prosecutorial
571 agency that the referral partner is under criminal investigation
572 including, but not limited to, subpoenas to produce records or
573 testimony and warrants issued by a court of competent
574 jurisdiction which authorize the search and seizure of any
575 records relating to a business activity regulated under this
576 chapter.
577 (e) Any other information requested by the office, subject
578 to the limitations specified in s. 516.45(4).
579 (8) NOTICE OF CHANGES.—A referral partner must provide the
580 program licensee with a written notice sent by registered mail
581 within 30 days of any changes to the information specified in
582 paragraphs (7)(a)-(7)(c) or the occurrence or knowledge of,
583 whichever time period is greater, any of the events specified in
584 paragraph (7)(d).
585 (9) RESPONSIBILITY FOR ACTS OF A REFERRAL PARTNER.—A
586 program licensee is responsible for any act of its referral
587 partner if the program licensee should have known of the act or
588 had actual knowledge that such act is a violation of this
589 chapter, and the program licensee allowed the act to continue.
590 Such responsibility is limited to conduct engaged in by the
591 referral partner pursuant to the authority granted to it by the
592 program licensee under the contract between the referral partner
593 and the program licensee.
594 (10) REFERRAL PARTNER FEE.—The program licensee shall pay
595 to the office, at the time it files a referral partner notice
596 with the office, a one-time nonrefundable fee of $30 for each
597 referral partner as prescribed by rule of the commission.
598 Section 6. Section 516.45, Florida Statutes, is created to
599 read:
600 516.45 Examinations and grounds for disciplinary action.—
601 (1) Notwithstanding any other law, commencing on January 1,
602 2018, the office must examine each program licensee that is
603 accepted into the program in accordance with this chapter;
604 provided that such examination occurs at least once every 24
605 months.
606 (2) Notwithstanding subsection (1), the office may waive
607 one or more branch office examinations if the office deems that
608 such examinations are not necessary for the protection of the
609 public due to the centralized operations of the program licensee
610 or other factors acceptable to the office.
611 (3) The examined program licensee must pay for the cost of
612 an examination to the office, pursuant to rule of the
613 commission, and the office may maintain an action for the
614 recovery of the cost in any court of competent jurisdiction. In
615 determining the cost of the examination, the office may use the
616 estimated average hourly cost for all persons performing
617 examinations of program licensees or other persons subject to
618 ss. 516.40-516.46 for the fiscal year.
619 (4) The scope of any investigation or examination of a
620 program licensee or referral partner shall be limited to those
621 books, accounts, records, documents, materials, and matters
622 reasonably necessary to determine compliance with this chapter.
623 (5) A program licensee who violates any applicable
624 provision of this chapter is subject to disciplinary action
625 pursuant to s. 516.07(2). Any such disciplinary action shall be
626 subject to the provisions in s. 120.60. A program licensee is
627 also subject to disciplinary action for a violation of s. 516.44
628 committed by any of its referral partners.
629 (6) The office may take any of the following actions
630 against a referral partner who violates the provisions of s.
631 516.44:
632 (a) Disqualify the referral partner from performing
633 services under this chapter,
634 (b) Bar the referral partner from performing services at
635 one or more specific locations of that referral partner,
636 (c) Terminate a written agreement between a referral
637 partner and a program licensee,
638 (d) Impose an administrative fine not to exceed $1,000 for
639 each act of the referral partner, and,
640 (e) If the office deems that action in the public interest,
641 prohibit the use of that referral partner by all program
642 licensees accepted to participate in the program.
643 Section 7. Section 516.46, Florida Statutes, is created to
644 read:
645 516.46 Report by the office.—
646 (1) On or before March 15 of each year, commencing in 2019,
647 a program licensee shall file a report with the office
648 containing aggregated or anonymized data, without reference to
649 any borrower’s nonpublic personal information or any proprietary
650 or trade secret information of the program licensee, on each of
651 the items specified in subsection (4).
652 (2) On or before January 1, 2020, the office must post a
653 report on its website summarizing the use of the program based
654 upon the information contained in the report filed by each
655 program licensee under subsection (1).
656 (3) The report must state the information in aggregate so
657 as not to identify data by specific program licensee.
658 (4) The office’s report must specify the period to which
659 the report corresponds and must include, but not be limited to,
660 the following for that period:
661 (a) The number of entities that applied to participate in
662 the program.
663 (b) The number of entities accepted to participate in the
664 program.
665 (c) The reasons for rejecting applications for
666 participation, if applicable. This information must be provided
667 in a manner that does not identify the entity or entities
668 rejected.
669 (d) The number of program loan applications received by
670 program licensees participating in the program, the number of
671 program loans made pursuant to the program, the total amount
672 loaned, the distribution of loan lengths upon origination, and
673 the distribution of interest rates and principal amounts upon
674 origination among those program loans.
675 (e) The number of borrowers who obtained more than one
676 program loan and the distribution of the number of program loans
677 per borrower.
678 (f) Of the borrowers who obtained more than one program
679 loan, the percentage of those borrowers whose credit scores
680 increased between successive loans, based on information from at
681 least one major credit bureau, and the average size of the
682 increase.
683 (g) The income distribution of borrowers upon program loan
684 origination, including the number of borrowers who obtained at
685 least one program loan and who resided in a low-income or
686 moderate-income census tract at the time of their loan
687 applications.
688 (h) The number of borrowers who obtained program loans for
689 the following purposes, based on borrower responses at the time
690 of their loan applications, and an indication whether the
691 primary purpose for which the program loan was obtained was to:
692 (i) The income distribution of borrowers upon program loan
693 origination, including the number of borrowers who obtained at
694 least one program loan and who resided in a low-income or
695 moderate-income census tract at the time of their loan
696 applications.
697 (j) The number of borrowers who obtained program loans for
698 the following purposes, based on borrower responses at the time
699 of their loan applications indicating the primary purpose for
700 which the program loan was obtained:
701 1. Pay medical expenses.
702 2. Pay for vehicle repair or a vehicle purchase.
703 3. Pay bills.
704 4. Consolidate debt.
705 5. Build or repair credit history.
706 6. Pay other expenses.
707 (k) The number of borrowers who self-report that they had a
708 bank account at the time of their loan application and the
709 number of borrowers who self-report that they did not have a
710 bank account at the time of their loan application.
711 (l) With respect to refinance program loans, the report
712 must specifically include the following information:
713 1. The number and percentage of borrowers who applied for a
714 refinance program loan.
715 2. Of those borrowers who applied for a refinance program
716 loan, the number and percentage of borrowers who obtained a
717 refinance program loan.
718 (m) The number and type of referral partners used by
719 program licensees.
720 (n) The number and percentage of borrowers who obtained one
721 or more program loans on which delinquency charges were
722 assessed, the total amount of delinquency charges assessed, and
723 the average delinquency charge assessed by dollar amount and as
724 a percentage of the principal amount loaned.
725 (o) The performance of program loans under the program as
726 reflected by all of the following:
727 1. The number and percentage of borrowers who experienced
728 at least one delinquency lasting between 7 and 29 days and the
729 distribution of principal loan amounts corresponding to those
730 delinquencies.
731 2. The number and percentage of borrowers who experienced
732 at least one delinquency lasting between 30 and 59 days and the
733 distribution of principal loan amounts corresponding to those
734 delinquencies.
735 3. The number and percentage of borrowers who experienced
736 at least one delinquency lasting 60 days or more and the
737 distribution of principal loan amounts corresponding to those
738 delinquencies.
739 (p) The number and types of violations of ss. 516.40-516.46
740 by referral partners which were documented by the office.
741 (q) The number and types of violations of ss. 516.40-516.46
742 by program licensees which were documented by the office.
743 (r) The number of times that the office disqualified a
744 referral partner from performing services, barred a referral
745 partner from performing services at one or more specific
746 locations of the referral partner, terminated a written
747 agreement between a referral partner and a program licensee, or
748 imposed an administrative penalty.
749 (s) The number of complaints received by the office about a
750 program licensee or a referral partner and the nature of those
751 complaints.
752 Section 8. Sections 516.40-516.46, Florida Statutes, are
753 repealed on December 31, 2022, unless reenacted or superseded by
754 another law enacted by the Legislature before that date.
755 Section 9. This act shall take effect October 1, 2017.
756
757 ================= T I T L E A M E N D M E N T ================
758 And the title is amended as follows:
759 Delete everything before the enacting clause
760 and insert:
761 A bill to be entitled
762 An act relating to consumer finance loans; creating s.
763 516.40, F.S.; establishing the Access to Responsible
764 Credit Pilot Program; providing legislative findings
765 and intent; creating s. 516.41, F.S.; defining terms;
766 creating s. 516.42, F.S.; prohibiting a person from
767 certain activities without prior approval from the
768 Office of Financial Regulation; specifying
769 requirements for participating in the program to make
770 certain consumer finance loans; specifying
771 requirements for an application and a fee; providing
772 applicability of laws and regulations to a program
773 licensee; requiring an approved program licensee to
774 pay a specified renewal fee; providing that only one
775 pilot program license is required for a person to make
776 program loans; requiring each branch office of a
777 program licensee to be licensed; requiring the office
778 to issue a program branch office license after making
779 certain determinations; specifying requirements for a
780 program branch office license application; providing
781 requirements for renewal of a program branch office
782 license; creating s. 516.43, F.S.; providing general
783 requirements for a program loan; requiring a program
784 licensee to provide specified written disclosures to a
785 borrower; specifying requirements for origination
786 fees; specifying requirements for insufficient funds
787 fees and delinquency charges; specifying requirements
788 for a program licensee relating to credit education
789 for a borrower; specifying requirements for reporting
790 borrower payment performance to credit reporting
791 agencies; prohibiting the office from approving a
792 licensee for the program before it has been accepted
793 as a data furnisher; requiring a program licensee to
794 provide a borrower with certain information relating
795 its credit reporting; specifying requirements for a
796 program licensee to underwrite program loans;
797 prohibiting a program licensee from requiring certain
798 waivers from a borrower; specifying requirements for
799 permissible waivers; prohibiting certain actions by a
800 program licensee; providing applicability; creating s.
801 516.44, F.S.; requiring a program licensee and a
802 referral partner to enter into a written referral
803 partner agreement; specifying permitted services by a
804 referral partner; specifying procedures for receipt or
805 disbursement by a referral partner of program loan
806 payments made by a borrower; providing that a borrower
807 who submits a loan payment to a referral partner is
808 not liable under certain circumstances; requiring a
809 referral partner to maintain certain records;
810 prohibiting certain activities by a referral partner;
811 specifying disclosure notice requirements; specifying
812 requirements, prohibitions, and limitations for
813 compensation from a program licensee to a referral
814 partner; requiring a program licensee to provide the
815 office with a specified notice after contracting with
816 a referral partner; requiring a referral partner to
817 provide the program licensee with a certain written
818 notice within a specified time; specifying the program
819 licensee’s responsibility for acts of its referral
820 partner; requiring a program licensee to pay a
821 specified fee to the office to file a referral partner
822 notice; creating s. 516.45, F.S.; requiring the office
823 to examine program licensees at specified intervals
824 beginning on a specified date; providing an exception;
825 requiring program licensees to pay the cost of
826 examinations; authorizing the office to maintain an
827 action of recovery of the cost; authorizing a manner
828 to determine the cost of examinations; providing
829 limitations of an investigation; providing that a
830 program licensee is subject to certain disciplinary
831 action for certain violations; authorizing the office
832 to take certain disciplinary actions; creating s.
833 516.46, F.S.; requiring a program licensee to file a
834 certain report with the office at certain intervals
835 beginning on a certain date; requiring the office to
836 post a report to its website summarizing the use of
837 the program by a certain date; specifying information
838 to be contained in the office’s report; providing for
839 conditional future repeal of the program; providing an
840 effective date.