CS for CS for CS for SB 920                First Engrossed (ntc)
       
       
       
       
       
       
       
       
       2018920e1
       
    1                        A bill to be entitled                      
    2         An act relating to deferred presentment transactions;
    3         amending s. 560.402, F.S.; providing and revising
    4         definitions; amending s. 560.404, F.S.; specifying the
    5         maximum face amount of checks that may be taken for
    6         deferred presentment installment transactions,
    7         exclusive of fees; specifying the maximum rate and
    8         frequency of fees that deferred presentment providers
    9         or their affiliates may charge on deferred presentment
   10         installment transactions; specifying when fees are
   11         earned for certain deferred presentment transactions;
   12         specifying the calculation of fees earned for deferred
   13         presentment installment transactions; prohibiting
   14         prepayment penalties; specifying the minimum and
   15         maximum terms of a deferred presentment installment
   16         transaction; specifying dates that checks must bear;
   17         authorizing providers of deferred presentment
   18         installment transactions to accept additional checks
   19         subject to certain limitations; requiring the deferred
   20         presentment agreement to include the deferment period
   21         applicable to each check; correcting a reference to
   22         federal law; providing an exception to a prohibition
   23         against the acceptance or holding of undated checks or
   24         checks with certain dates by a deferred presentment
   25         provider or its affiliate; conforming a cross
   26         reference; providing a verification process that may
   27         be relied upon under certain conditions; revising a
   28         notice in deferred presentment agreements; authorizing
   29         a drawer to inform a provider in writing that the
   30         drawer cannot redeem or pay in full the amount due and
   31         owing to the provider; providing an exception to a
   32         prohibition, under certain circumstances, against a
   33         deferred presentment provider’s deposit or presentment
   34         of a drawer’s check; requiring a provider of a
   35         deferred presentment installment transaction to allow
   36         a drawer to defer one scheduled payment under certain
   37         circumstances; providing requirements for the deferred
   38         payment; specifying the frequency a certain fee may be
   39         imposed by Financial Services Commission rule for data
   40         on certain transactions submitted by deferred
   41         presentment providers to a certain database; providing
   42         an exception to a limitation on a deferred presentment
   43         provider’s acceptance of a certain check or
   44         authorization; specifying requirements for
   45         amortization, installment repayments, and the
   46         calculation of charges for deferred presentment
   47         installment transactions; conforming provisions to
   48         changes made by the act; amending s. 560.405, F.S.;
   49         providing an exception to a prohibition against a
   50         deferred presentment provider’s or its affiliate’s
   51         presentment of a drawer’s check before the end of the
   52         deferment period; revising a condition under which a
   53         deferred presentment provider may allow the check to
   54         be redeemed in lieu of presentment; revising a
   55         prohibition against requiring a drawer to redeem his
   56         or her check before the agreed-upon date; reenacting
   57         s. 560.111(5), F.S., relating to prohibited acts, to
   58         incorporate the amendments made to ss. 560.404 and
   59         560.405, F.S., in references thereto; providing an
   60         effective date.
   61          
   62  Be It Enacted by the Legislature of the State of Florida:
   63  
   64         Section 1. Present subsections (3) through (5) and (6) of
   65  section 560.402, Florida Statutes, are renumbered as subsections
   66  (4) through (6) and (8), respectively, present subsection (7) is
   67  amended, and new subsections (3) and (7) are added to that
   68  section, to read:
   69         560.402 Definitions.—For the purposes of this part, the
   70  term:
   71         (3)“Deferred presentment installment transaction” means a
   72  deferred presentment transaction that is repayable in
   73  installments.
   74         (7)“Outstanding transaction balance” means the amount
   75  received by the drawer from the deferred presentment provider
   76  which is due and owing, exclusive of the fees allowed under this
   77  part, in a deferred presentment transaction.
   78         (9)(7) “Termination of a deferred presentment agreement”
   79  means that all checks the check that are is the basis for the
   80  agreement are is redeemed by the drawer by payment in full in
   81  cash, or are is deposited and the deferred presentment provider
   82  has evidence that such checks have check has cleared.
   83  Verification of sufficient funds in the drawer’s account by the
   84  deferred presentment provider is not sufficient evidence to deem
   85  that the deferred presentment deposit transaction is terminated.
   86         Section 2. Subsections (5), (6), (8), (12), (13), (14),
   87  (19), (20), (21), and (22) and present subsections (23) and (24)
   88  of section 560.404, Florida Statutes, are amended, and a new
   89  subsection (23) and subsection (26) are added to that section,
   90  to read:
   91         560.404 Requirements for deferred presentment
   92  transactions.—
   93         (5) The face amount of a check taken for deferred
   94  presentment transactions not repayable in installments may not
   95  exceed $500, exclusive of the fees allowed under this part. For
   96  a deferred presentment installment transaction, neither the face
   97  amount of a check nor the outstanding transaction balance may
   98  exceed $1,000, exclusive of the fees allowed under this part.
   99         (6)(a) A deferred presentment provider or its affiliate may
  100  not charge fees that exceed 10 percent of the currency or
  101  payment instrument provided for a deferred presentment
  102  transaction not repayable in installments. A deferred
  103  presentment provider or its affiliate may not charge fees on any
  104  deferred presentment installment transaction which exceed 8
  105  percent of the outstanding transaction balance on a biweekly
  106  basis.
  107         (b)Notwithstanding paragraph (a) However, a verification
  108  fee may be charged as provided in s. 560.309(8). The fees in
  109  paragraph (a) The 10-percent fee may not be applied to the
  110  verification fee.
  111         (c)Fees are earned at the time of origination for a
  112  deferred presentment transaction scheduled to be paid off in 31
  113  days or less; however, fees for a deferred presentment
  114  installment transaction are earned using a simple interest
  115  calculation. A deferred presentment provider may charge only
  116  those fees specifically authorized in this section. Prepayment
  117  penalties are prohibited.
  118         (8) A deferred presentment agreement may not be for a term
  119  longer than 31 days or fewer less than 7 days, except for a
  120  deferred presentment installment transaction, which may not be
  121  for a term longer than 90 days or fewer than 60 days.
  122         (12) The deferred presentment agreement and the drawer’s
  123  initial check must bear the same date, and the number of days of
  124  the deferment period must shall be calculated from that date.
  125  For deferred presentment installment transactions, the deferred
  126  presentment provider may accept additional checks, subject to
  127  the limitations in subsection (5), each bearing the date that
  128  the check was given to the provider, and the deferred
  129  presentment agreement must include the deferment period
  130  applicable to each check. The deferred presentment provider and
  131  the drawer may not alter or delete the date on any written
  132  agreement or check held by the deferred presentment provider.
  133         (13) For each deferred presentment transaction, the
  134  deferred presentment provider must comply with the disclosure
  135  requirements of 12 C.F.R. part 1026 226, relating to the federal
  136  Truth-in-Lending Act, and Regulation Z of the Bureau of Consumer
  137  Financial Protection Board of Governors of the Federal Reserve
  138  Board. A copy of the disclosure must be provided to the drawer
  139  at the time the deferred presentment transaction is initiated.
  140         (14) A deferred presentment provider or its affiliate may
  141  not accept or hold an undated check or a check dated on a date
  142  other than the date on which the deferred presentment provider
  143  agreed to hold the check and signed the deferred presentment
  144  transaction agreement, except when a customer provides a new
  145  payment instrument reflecting the new outstanding transaction
  146  balance and anticipated fees upon making a payment on a deferred
  147  presentment installment transaction.
  148         (19) A deferred presentment provider may not enter into a
  149  deferred presentment transaction with a drawer who has an
  150  outstanding deferred presentment transaction with that provider
  151  or with any other deferred presentment provider, or with a
  152  person whose previous deferred presentment transaction with that
  153  provider or with any other provider has been terminated for less
  154  than 24 hours. The deferred presentment provider must verify
  155  such information as follows:
  156         (a) The deferred presentment provider must shall maintain a
  157  common database and shall verify whether the provider or an
  158  affiliate has an outstanding deferred presentment transaction
  159  with a particular person or has terminated a transaction with
  160  that person within the previous 24 hours. If a provider has not
  161  established a database, the provider may rely upon the written
  162  verification of the drawer as provided in subsection (20).
  163         (b) The deferred presentment provider must shall access the
  164  office’s database established pursuant to subsection (24) (23)
  165  and shall verify whether any other deferred presentment provider
  166  has an outstanding deferred presentment transaction with a
  167  particular person or has terminated a transaction with that
  168  person within the previous 24 hours. Before the office has
  169  implemented a database to include deferred presentment
  170  installment transactions If a provider has not established a
  171  database, the deferred presentment provider must access the
  172  office’s current database pursuant to this paragraph and may
  173  rely upon the written verification of the drawer as provided in
  174  subsection (20).
  175         (20) A deferred presentment provider must shall provide the
  176  following notice in a prominent place on each deferred
  177  presentment agreement in at least 14-point type in substantially
  178  the following form and must obtain the signature of the drawer
  179  where indicated:
  180  
  181                               NOTICE                              
  182  
  183         1. STATE LAW PROHIBITS YOU FROM HAVING MORE THAN ONE
  184         DEFERRED PRESENTMENT AGREEMENT AT ANY ONE TIME. STATE
  185         LAW ALSO PROHIBITS YOU FROM ENTERING INTO A DEFERRED
  186         PRESENTMENT AGREEMENT WITHIN 24 HOURS AFTER
  187         TERMINATING ANY PREVIOUS DEFERRED PRESENTMENT
  188         AGREEMENT. FAILURE TO OBEY THIS LAW COULD CREATE
  189         SEVERE FINANCIAL HARDSHIP FOR YOU AND YOUR FAMILY.
  190  
  191         YOU MUST SIGN THE FOLLOWING STATEMENT:
  192  
  193         I DO NOT HAVE AN OUTSTANDING DEFERRED PRESENTMENT
  194         AGREEMENT WITH ANY DEFERRED PRESENTMENT PROVIDER AT
  195         THIS TIME. I HAVE NOT TERMINATED A DEFERRED
  196         PRESENTMENT AGREEMENT WITHIN THE PAST 24 HOURS.
  197         (Signature of Drawer)
  198  
  199         2. YOU CANNOT BE PROSECUTED IN CRIMINAL COURT FOR A
  200         CHECK WRITTEN UNDER THIS AGREEMENT, BUT ALL LEGALLY
  201         AVAILABLE CIVIL MEANS TO ENFORCE THE DEBT MAY BE
  202         PURSUED AGAINST YOU.
  203  
  204         3. STATE LAW PROHIBITS A DEFERRED PRESENTMENT PROVIDER
  205         (THIS BUSINESS) FROM ALLOWING YOU TO “ROLL OVER” YOUR
  206         DEFERRED PRESENTMENT TRANSACTION. THIS MEANS THAT YOU
  207         CANNOT BE ASKED OR REQUIRED TO PAY AN ADDITIONAL FEE
  208         IN ORDER TO FURTHER DELAY THE DEPOSIT OR PRESENTMENT
  209         OF YOUR CHECK FOR PAYMENT.
  210  
  211         4. FOR DEFERRED PRESENTMENT TRANSACTIONS NOT REPAYABLE
  212         IN INSTALLMENTS: IF YOU INFORM THE PROVIDER IN PERSON
  213         THAT YOU CANNOT COVER THE CHECK OR PAY IN FULL THE
  214         AMOUNT OWING AT THE END OF THE TERM OF THIS AGREEMENT,
  215         YOU WILL RECEIVE A GRACE PERIOD EXTENDING THE TERM OF
  216         THE AGREEMENT FOR AN ADDITIONAL 60 DAYS AFTER THE
  217         ORIGINAL TERMINATION DATE, WITHOUT ANY ADDITIONAL
  218         CHARGE. THE DEFERRED PRESENTMENT PROVIDER MUST SHALL
  219         REQUIRE THAT YOU, AS A CONDITION OF OBTAINING THE
  220         GRACE PERIOD, COMPLETE CONSUMER CREDIT COUNSELING
  221         PROVIDED BY AN AGENCY INCLUDED ON THE LIST THAT WILL
  222         BE PROVIDED TO YOU BY THIS PROVIDER. YOU MAY ALSO
  223         AGREE TO COMPLY WITH AND ADHERE TO A REPAYMENT PLAN
  224         APPROVED BY THAT AGENCY. IF YOU DO NOT COMPLY WITH AND
  225         ADHERE TO A REPAYMENT PLAN APPROVED BY THAT AGENCY, WE
  226         MAY DEPOSIT OR PRESENT YOUR CHECK FOR PAYMENT AND
  227         PURSUE ALL LEGALLY AVAILABLE CIVIL MEANS TO ENFORCE
  228         THE DEBT AT THE END OF THE 60-DAY GRACE PERIOD.
  229  
  230         5. FOR DEFERRED PRESENTMENT INSTALLMENT TRANSACTIONS:
  231         IF YOU INFORM THE PROVIDER IN WRITING OR IN PERSON BY
  232         NOON [TIME ZONE] OF THE BUSINESS DAY BEFORE A
  233         SCHEDULED PAYMENT THAT YOU CANNOT PAY IN FULL THE
  234         SCHEDULED AMOUNT DUE AND OWING, YOU MAY DEFER THE
  235         SCHEDULED PAYMENT, WITHOUT ANY ADDITIONAL FEES OR
  236         CHARGES, AND THE PROVIDER MAY NOT DEFAULT THE ACCOUNT
  237         AND ACCELERATE THE FULL BALANCE. YOU MAY REQUEST ONLY
  238         ONE DEFERRED PAYMENT PER LOAN. THE DEFERRED PAYMENT
  239         WILL BE ADDED AFTER THE LAST SCHEDULED PAYMENT AND IS
  240         DUE AT AN INTERVAL NO SHORTER THAN THE INTERVALS
  241         BETWEEN THE ORIGINALLY SCHEDULED PAYMENTS.
  242  
  243         (21) The deferred presentment provider may not deposit or
  244  present the drawer’s check if the drawer informs the provider in
  245  writing or in person that the drawer cannot redeem or pay in
  246  full in cash the amount due and owing the deferred presentment
  247  provider, unless the drawer fails to comply with subsection (22)
  248  or subsection (23), as applicable. No additional fees or
  249  penalties may be imposed on the drawer by virtue of any
  250  misrepresentation made by the drawer as to the sufficiency of
  251  funds in the drawer’s account. Additional fees may not be added
  252  to the amounts due and owing to the deferred presentment
  253  provider.
  254         (22) For deferred presentment transactions not repayable in
  255  installments, if, by the end of the deferment period, the drawer
  256  informs the deferred presentment provider in writing or in
  257  person that the drawer cannot redeem or pay in full in cash the
  258  amount due and owing the deferred presentment provider, the
  259  deferred presentment provider must shall provide a grace period
  260  extending the term of the agreement for an additional 60 days
  261  after the original termination date, without any additional
  262  charge.
  263         (a) The provider must shall require, that as a condition of
  264  providing a grace period, that the drawer make an appointment
  265  with a consumer credit counseling agency within 7 days after the
  266  end of the deferment period and complete the counseling by the
  267  end of the grace period. The drawer may agree to, comply with,
  268  and adhere to a repayment plan approved by the counseling
  269  agency. If the drawer agrees to comply with and adhere to a
  270  repayment plan approved by the counseling agency, the provider
  271  must also comply with and adhere to that repayment plan. The
  272  deferred presentment provider may not deposit or present the
  273  drawer’s check for payment before the end of the 60-day grace
  274  period unless the drawer fails to comply with such conditions or
  275  the drawer fails to notify the provider of such compliance.
  276  Before each deferred presentment transaction, the provider may
  277  verbally advise the drawer of the availability of the grace
  278  period consistent with the written notice in subsection (20),
  279  and may not discourage the drawer from using the grace period.
  280         (b) At the commencement of the grace period, the deferred
  281  presentment provider must shall provide the drawer:
  282         1. Verbal notice of the availability of the grace period
  283  consistent with the written notice in subsection (20).
  284         2. A list of approved consumer credit counseling agencies
  285  prepared by the office. The office list must shall include
  286  nonprofit consumer credit counseling agencies affiliated with
  287  the National Foundation for Credit Counseling which provide
  288  credit counseling services to state residents in person, by
  289  telephone, or through the Internet. The office list must include
  290  phone numbers for the agencies, the counties served by the
  291  agencies, and indicate the agencies that provide telephone
  292  counseling and those that provide Internet counseling. The
  293  office must shall update the list at least once each year.
  294         3. The following notice in at least 14-point type in
  295  substantially the following form:
  296  
  297         AS A CONDITION OF OBTAINING A GRACE PERIOD EXTENDING
  298         THE TERM OF YOUR DEFERRED PRESENTMENT AGREEMENT FOR AN
  299         ADDITIONAL 60 DAYS, UNTIL [DATE], WITHOUT ANY
  300         ADDITIONAL FEES, YOU MUST COMPLETE CONSUMER CREDIT
  301         COUNSELING PROVIDED BY AN AGENCY INCLUDED ON THE LIST
  302         THAT WILL BE PROVIDED TO YOU BY THIS PROVIDER. YOU MAY
  303         ALSO AGREE TO COMPLY WITH AND ADHERE TO A REPAYMENT
  304         PLAN APPROVED BY THE AGENCY. THE COUNSELING MAY BE IN
  305         PERSON, BY TELEPHONE, OR THROUGH THE INTERNET. YOU
  306         MUST NOTIFY US WITHIN 7 DAYS, BY [DATE], THAT YOU HAVE
  307         MADE AN APPOINTMENT WITH A CONSUMER CREDIT COUNSELING
  308         AGENCY. YOU MUST ALSO NOTIFY US WITHIN 60 DAYS, BY
  309         [DATE], THAT YOU HAVE COMPLETED THE CONSUMER CREDIT
  310         COUNSELING. WE MAY VERIFY THIS INFORMATION WITH THE
  311         AGENCY. IF YOU FAIL TO PROVIDE THE 7-DAY OR 60-DAY
  312         NOTICE, OR IF YOU HAVE NOT MADE THE APPOINTMENT OR
  313         COMPLETED THE COUNSELING WITHIN THE TIME REQUIRED, WE
  314         MAY DEPOSIT OR PRESENT YOUR CHECK FOR PAYMENT AND
  315         PURSUE ALL LEGALLY AVAILABLE CIVIL MEANS TO ENFORCE
  316         THE DEBT.
  317  
  318         (c) If a drawer completes an approved payment plan, the
  319  deferred presentment provider must shall pay one-half of the
  320  drawer’s fee for the deferred presentment agreement to the
  321  consumer credit counseling agency.
  322         (23) For deferred presentment installment transactions, if
  323  a drawer informs the deferred presentment provider in writing or
  324  in person by noon of the business day before a scheduled payment
  325  that the drawer cannot pay in full the scheduled payment amount
  326  due and owing the provider, the deferred presentment provider
  327  must provide the drawer the opportunity to defer the scheduled
  328  payment, at no additional fee or charge, until after the last
  329  scheduled payment. The phrase “by noon” means 12:00 p.m. of the
  330  same time zone in which the deferred presentment agreement was
  331  entered into. Only one deferred payment is permitted for each
  332  deferred presentment installment transaction. The deferred
  333  payment must be due at an interval after the last scheduled
  334  payment which is no shorter than the intervals between the
  335  originally scheduled payments.
  336         (24)(a)(23) The office must shall implement a common
  337  database with real-time access through an Internet connection
  338  for deferred presentment providers, as provided in this
  339  subsection. The database must be accessible to the office and
  340  the deferred presentment providers in order to verify whether
  341  any deferred presentment transactions are outstanding for a
  342  particular person. Deferred presentment providers must shall
  343  submit such data before entering into each deferred presentment
  344  transaction in such format as required by rule, including the
  345  drawer’s name, social security number or employment
  346  authorization alien number, address, driver license number,
  347  amount of the transaction, date of transaction, the date that
  348  the transaction is closed, and such additional information as is
  349  required by rule.
  350         (b) For data that must be submitted by a deferred
  351  presentment provider, the commission may by rule impose a fee of
  352  up to $1 per transaction for deferred presentment transactions
  353  not repayable in installments, and the commission may impose a
  354  fee of up to $1 for each full or partial 30-day period that a
  355  balance is scheduled to be outstanding for a deferred
  356  presentment installment transaction for data that must be
  357  submitted by a deferred presentment provider.
  358         (c) A deferred presentment provider may rely on the
  359  information contained in the database as accurate and is not
  360  subject to any administrative penalty or civil liability due to
  361  relying on inaccurate information contained in the database.
  362         (d) A deferred presentment provider must notify the office,
  363  in a manner as prescribed by rule, within 15 business days after
  364  ceasing operations or no longer holding a license under part II
  365  or part III of this chapter. Such notification must include a
  366  reconciliation of all open transactions. If the provider fails
  367  to provide notice, the office must shall take action to
  368  administratively release all open and pending transactions in
  369  the database after the office becomes aware of the closure.
  370         (e) This section does not affect the rights of the provider
  371  to enforce the contractual provisions of the deferred
  372  presentment agreements through any civil action allowed by law.
  373         (f) The commission may adopt rules to administer this
  374  subsection and to ensure that the database is used by deferred
  375  presentment providers in accordance with this section.
  376         (25)(24) A deferred presentment provider may not accept
  377  more than one check or authorization to initiate more than one
  378  automated clearinghouse transaction to collect on a deferred
  379  presentment transaction for a single deferred presentment
  380  transaction, except for deferred presentment installment
  381  transactions in which such checks or authorizations represent
  382  multiple scheduled payments.
  383         (26) A deferred presentment installment transaction must be
  384  fully amortizing and repayable in consecutive installments as
  385  nearly equal as mathematically practicable according to a
  386  payment schedule agreed upon by the parties with no fewer than
  387  13 days and not more than 1 calendar month between payments,
  388  except that the first installment period may be longer than the
  389  remaining installment periods by not more than 15 days, and the
  390  first installment payment may be larger than the remaining
  391  installment payments by the amount of charges applicable to the
  392  extra days. In calculating charges under this subsection, when
  393  the first installment period is longer than the remaining
  394  installment periods, the amount of the charges applicable to the
  395  extra days may not exceed those that would accrue under a simple
  396  interest calculation based on the rate allowed under subsection
  397  (6).
  398         Section 3. Subsections (1), (3), and (4) of section
  399  560.405, Florida Statutes, are amended to read:
  400         560.405 Deposit; redemption.—
  401         (1) The deferred presentment provider or its affiliate may
  402  not present the drawer’s check before the end of the deferment
  403  period, except for a missed scheduled payment for a deferred
  404  presentment installment transaction that has not been otherwise
  405  deferred pursuant to s. 560.404(23), as reflected and described
  406  in the deferred presentment transaction agreement.
  407         (3) Notwithstanding subsection (1), in lieu of presentment,
  408  a deferred presentment provider may allow the check to be
  409  redeemed at any time upon payment of the outstanding transaction
  410  balance and earned fees face amount of the drawer’s check.
  411  However, payment may not be made in the form of a personal
  412  check. Upon redemption, the deferred presentment provider must
  413  shall return the drawer’s check and provide a signed, dated
  414  receipt showing that the drawer’s check has been redeemed.
  415         (4) A drawer may not be required to redeem his or her check
  416  in full before the agreed-upon date; however, the drawer may
  417  choose to redeem the check before the agreed-upon presentment
  418  date.
  419         Section 4. For the purpose of incorporating the amendments
  420  made by this act to sections 560.404 and 560.405, Florida
  421  Statutes, in references thereto, subsection (5) of section
  422  560.111, Florida Statutes, is reenacted to read:
  423         560.111 Prohibited acts.—
  424         (5) Any person who willfully violates any provision of s.
  425  560.403, s. 560.404, or s. 560.405 commits a felony of the third
  426  degree, punishable as provided in s. 775.082, s. 775.083, or s.
  427  775.084.
  428         Section 5. This act shall take effect July 1, 2019.