Senate Bill sb1526c3

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    Florida Senate - 2001     CS for CS for CS for SB's 1526 & 314

    By the Committees on Finance and Taxation; Commerce and
    Economic Opportunities; Banking and Insurance; and Senators
    Constantine and Campbell



    314-1826-01

  1                      A bill to be entitled

  2         An act relating to the Money Transmitter's

  3         Code; amending s. 560.103, F.S.; revising

  4         definitions; amending s. 560.111, F.S.;

  5         providing penalties for specified violations of

  6         the deferred presentment act; amending s.

  7         560.114, F.S.; providing additional grounds for

  8         disciplinary action; providing for continuation

  9         of certain administrative proceedings under

10         certain circumstances; amending s. 560.118,

11         F.S.; eliminating the authority to assess

12         examination fees; amending s. 560.119, F.S.;

13         revising the deposit of fees and assessments;

14         amending s. 560.204, F.S.; clarifying exemption

15         from registration fees under part III of ch.

16         560, F.S.; amending s. 560.205, F.S.; adding a

17         fee for authorized vendor or branch locations;

18         amending s. 560.206, F.S.; amending the

19         registration period; amending s. 560.207, F.S.;

20         conforming and clarifying the fee for late

21         renewals; amending the renewal application fee;

22         amending s. 560.208, F.S.; requiring

23         notification of vendor or branch locations;

24         requiring a nonrefundable fee and financial

25         statement; amending s. 560.307, F.S.; applying

26         the application fee to check cashers and

27         foreign currency exchanges and adding a fee for

28         authorized vendors or branch locations;

29         requiring notification of vendor or branch

30         locations; amending s. 560.308, F.S.;

31         increasing the registration and renewal fee for

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  1         each registrant; clarifying the fee to be

  2         charged for late renewal; creating part IV, ch.

  3         560, F.S., consisting of ss. 560.401, 560.402,

  4         560.403, 560.404, 560.405, 560.406, 560.407,

  5         and 560.408, F.S.; providing a short title;

  6         providing definitions; providing registration

  7         requirements for deferred presentment

  8         transactions; providing for filing fees;

  9         providing limitations; specifying requirements

10         and limitations for engaging in deferred

11         presentment transactions; providing

12         prohibitions; providing for fees; providing

13         limitations; requiring certain notice;

14         specifying criteria and requirements for

15         deposit and redemption of a drawer's check;

16         providing procedures for recovering damages for

17         worthless checks; requiring maintenance of

18         records for a time certain; providing

19         legislative intent; requiring the Comptroller

20         to submit a report to the President of the

21         Senate and the Speaker of the House of

22         Representatives concerning the effectiveness of

23         this act; providing an effective date.

24

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

26

27         Section 1.  Paragraph (d) is added to subsection (4) of

28  section 560.103, Florida Statutes, and subsection (10) of that

29  section is amended, to read:

30         560.103  Definitions.--As used in the code, unless the

31  context otherwise requires:

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  1         (4)  "Code" means the "Money Transmitters' Code,"

  2  consisting of:

  3         (d)  Part IV of this chapter, relating to deferred

  4  presentments.

  5         (10)  "Money transmitter" means any person located in

  6  or doing business in this state who acts as a payment

  7  instrument seller, foreign currency exchanger, check casher,

  8  or funds transmitter, or deferred presentment provider.

  9         Section 2.  Subsection (4) is added to section 560.111,

10  Florida Statutes, to read:

11         560.111  Prohibited acts and practices.--

12         (4)  Any person who willfully violates any provision of

13  s. 560.403, s. 560.404, s. 560.405, or s. 560.407 commits a

14  felony of the third degree, punishable as provided in s.

15  775.082, s. 775.083, or s. 775.084.

16         Section 3.  Paragraphs (w) and (x) are added to

17  subsection (1) of section 560.114, Florida Statutes, to read:

18         560.114  Disciplinary actions.--

19         (1)  The following actions by a money transmitter or

20  money transmitter-affiliated party are violations of the code

21  and constitute grounds for the issuance of a cease and desist

22  order, the issuance of a removal order, the denial of a

23  registration application or the suspension or revocation of

24  any registration previously issued pursuant to the code, or

25  the taking of any other action within the authority of the

26  department pursuant to the code:

27         (w)  Failure to pay any fee, charge, or fine under the

28  code.

29         (x)  Engaging or advertising engagement in the business

30  of a money transmitter without a registration, unless the

31

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  1  person is exempted from the registration requirements of the

  2  code.

  3         Section 4.  Subsection (1) of section 560.118, Florida

  4  Statutes, is amended to read:

  5         560.118  Examinations, reports, and internal audits;

  6  penalty.--

  7         (1)(a)  The department may conduct an examination of a

  8  money transmitter or authorized vendor by providing not less

  9  than 15 days' advance notice to the money transmitter or

10  authorized vendor. However, if the department suspects that

11  the money transmitter or authorized vendor has violated any

12  provisions of this code or any criminal laws of this state or

13  of the United States or is engaging in an unsafe and unsound

14  practice, the department may, at any time without advance

15  notice, conduct an examination of all affairs, activities,

16  transactions, accounts, business records, and assets of any

17  money transmitter or any money transmitter-affiliated party

18  for the protection of the public. For the purpose of

19  examinations, the department may administer oaths and examine

20  a money transmitter or any of its affiliated parties

21  concerning their operations and business activities and

22  affairs. The department may accept an audit or examination

23  from any appropriate regulatory agency or from an independent

24  third party with respect to the operations of a money

25  transmitter or an authorized vendor. The department may also

26  make a joint or concurrent examination with any state or

27  federal regulatory agency. The department may furnish a copy

28  of all examinations made of such money transmitter or

29  authorized vendor to the money transmitter and any appropriate

30  regulatory agency provided that such agency agrees to abide by

31  the confidentiality provisions as set forth in chapter 119.

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  1         (b)  Persons subject to this chapter who are examined

  2  shall make available to the department or its examiners the

  3  accounts, records, documents, files, information, assets, and

  4  matters which are in their immediate possession or control and

  5  which relate to the subject of the examination. Those

  6  accounts, records, documents, files, information, assets, and

  7  matters not in their immediate possession shall be made

  8  available to the department or the department's examiners

  9  within 10 days after actual notice is served on such persons.

10         (c)  The audit of a money transmitter required under

11  this section may be performed by an independent third party

12  that has been approved by the department or by a certified

13  public accountant authorized to do business in the United

14  States. The examination of a money transmitter or authorized

15  vendor required under this section may be performed by an

16  independent third party that has been approved by the

17  department or by a certified public accountant authorized to

18  do business in the United States. The cost of such an

19  independent examination or audit shall be directly borne by

20  the money transmitter or authorized vendor.

21         (d)  The department may recover the costs of a regular

22  examination and supervision of a money transmitter or

23  authorized vendor; however, the department may not recover the

24  costs of more than one examination in any 12-month period

25  unless the department has determined that the money

26  transmitter or authorized vendor is operating in an unsafe or

27  unsound or unlawful manner.

28         (e)  The department may, by rule, set a maximum per-day

29  examination cost for a regular examination. Such per-day cost

30  may be less than that required to fully compensate the

31  department for costs associated with the examination. For the

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  1  purposes of this section, "costs" means the salary and travel

  2  expenses directly attributable to the field staff examining

  3  the money transmitter or authorized vendor, and the travel

  4  expenses of any supervisory staff required as a result of

  5  examination findings. Reimbursement for such costs incurred

  6  under this subsection must be postmarked no later than 30 days

  7  after the date of receipt of a notice stating that such costs

  8  are due. The department may levy a late payment penalty of up

  9  to $100 per day or part thereof that a payment is overdue,

10  unless the late payment penalty is excused for good cause. In

11  excusing any such late payment penalty, the department may

12  consider the prior payment history of the money transmitter or

13  authorized vendor.

14         Section 5.  Section 560.119, Florida Statutes, is

15  amended to read:

16         560.119  Deposit of fees and assessments.--The

17  application fees, registration renewal fees, examination fees,

18  late payment penalties, civil penalties, administrative fines,

19  and other fees or penalties provided for in the code shall, in

20  all cases, be paid directly to the department, which shall

21  deposit such proceeds into the Financial Institutions'

22  Regulatory Trust Fund. Each year, the Legislature shall

23  appropriate from the trust fund to the department sufficient

24  moneys to pay the department's costs for administration of the

25  code. The Financial Institutions' Regulatory Trust Fund is

26  subject to the service charge imposed pursuant to chapter 215.

27         Section 6.  Subsection (2) of section 560.204, Florida

28  Statutes, is amended to read:

29         560.204  Requirement of registration.--

30         (2)  A person registered pursuant to this part is

31  permitted to engage in the activities authorized by this part.

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  1  A person registered pursuant to this part may also engage in

  2  the activities authorized under part III and is exempt from

  3  the registration fee required by s. 560.307.

  4         Section 7.  Subsection (2) of section 560.205, Florida

  5  Statutes, is amended to read:

  6         560.205  Qualifications of applicant for registration;

  7  contents.--

  8         (2)  Each application for registration must be

  9  submitted under oath to the department on such forms as the

10  department prescribes by rule and must be accompanied by a

11  nonrefundable application investigation fee. Such fee may not

12  exceed $500 for each payment instrument seller or funds

13  transmitter and $50 for each authorized vendor or location

14  operating within this state and may be waived by the

15  department for just cause. The application forms shall set

16  forth such information as the department reasonably requires,

17  including, but not limited to:

18         (a)  The name and address of the applicant, including

19  any fictitious or trade names used by the applicant in the

20  conduct of its business.

21         (b)  The history of the applicant's material

22  litigation, criminal convictions, pleas of nolo contendere,

23  and cases of adjudication withheld.

24         (c)  A description of the activities conducted by the

25  applicant, the applicant's history of operations, and the

26  business activities in which the applicant seeks to engage in

27  this state.

28         (d)  A list identifying the applicant's proposed

29  authorized vendors in this state, including the location or

30  locations in this state at which the applicant and its

31  authorized vendors propose to conduct registered activities.

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  1         (e)  A sample authorized vendor contract, if

  2  applicable.

  3         (f)  A sample form of payment instrument, if

  4  applicable.

  5         (g)  The name and address of the clearing financial

  6  institution or financial institutions through which the

  7  applicant's payment instruments will be drawn or through which

  8  such payment instruments will be payable.

  9         (h)  Documents revealing that the net worth and bonding

10  requirements specified in s. 560.209 have been or will be

11  fulfilled.

12         Section 8.  Section 560.206, Florida Statutes, is

13  amended to read:

14         560.206  Investigation of applicants.--Upon the filing

15  of a properly completed application, accompanied by the

16  nonrefundable application fee and other required documents,

17  the department shall investigate to ascertain whether the

18  qualifications and requirements prescribed by this part have

19  been met. If the department finds that the applicant meets

20  such qualifications and requirements, the department shall

21  issue the applicant a registration to engage in the business

22  of selling payment instruments and transmitting funds in this

23  state. Any registration issued under this part shall remain

24  effective through April 30 of the second year following the

25  date of issuance of the registration, not to exceed 24 months,

26  unless during such period the registration is in effect

27  through April 30 next following its date of issuance unless

28  otherwise specified by the department or earlier surrendered,

29  suspended, or revoked.

30         Section 9.  Section 560.207, Florida Statutes, is

31  amended to read:

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  1         560.207  Renewal of registration; registration fee.--

  2         (1)  Registration may be renewed for a 24-month period

  3  or the remainder of any such period without proration

  4  following the date of its expiration, upon the filing with the

  5  department of an application and other statements and

  6  documents as may reasonably be required of registrants by the

  7  department. However, the registrant must remain qualified for

  8  such registration under the provisions of this part.

  9         (2)  All registration renewal applications shall be

10  accompanied by a renewal fee not to exceed $1,000, unless such

11  fee is waived by the department. All renewal applications must

12  be filed on or after January 1 of the year in which the

13  existing registration expires, but before the expiration date

14  of April 30 March 31. If the renewal application is filed

15  prior to the expiration date of an existing registration, no

16  late investigation fee shall be paid in connection with such

17  renewal application. If the renewal application is filed

18  within 60 calendar days after the expiration date of an

19  existing registration, then, in addition to the $1,000 renewal

20  fee, the renewal application shall be accompanied by a

21  nonrefundable late fee of $500 investigation fee pursuant to

22  s. 560.205(2). If the registrant has not filed a renewal

23  application within 60 calendar days after the expiration date

24  of an existing registration, a new application shall be filed

25  with the department pursuant to s. 560.205.

26         (3)  Every registration renewal application shall also

27  include a 2-year registration renewal fee of $50 for each

28  authorized vendor or location operating within this state or,

29  at the option of the registrant, a total 2-year renewal fee of

30  $20,000 $5,000 may be paid to renew the registration of

31

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  1  register all such locations currently registered at the time

  2  of renewal operating within this state.

  3         Section 10.  Section 560.208, Florida Statutes, is

  4  amended to read:

  5         560.208  Conduct of business.--

  6         (1)  A registrant may conduct its business at one or

  7  more locations within this state through branches or by means

  8  of authorized vendors, as designated by the registrant.

  9         (2)  Within 60 days after the date a registrant either

10  opens a location within this state or authorizes an authorized

11  vendor to operate on the registrant's behalf within this

12  state, the registrant shall notify the department on a form

13  prescribed by the department by rule. The notification shall

14  be accompanied by a nonrefundable $50 fee for each authorized

15  vendor or location. Each notification shall also be

16  accompanied by a financial statement demonstrating compliance

17  with s. 560.209(1), unless compliance has been demonstrated by

18  a financial statement filed with the registrant's quarterly

19  report in compliance with s. 560.118(2). The financial

20  statement must be dated within 90 days of the date of

21  designation of the authorized vendor or location. This

22  subsection shall not apply to any authorized vendor or

23  location that has been designated by the registrant before

24  October 1, 2001.

25         (3)  Within 60 days after the date a registrant closes

26  a location within this state or withdraws authorization for an

27  authorized vendor to operate on the registrant's behalf within

28  this state, the registrant shall notify the department on a

29  form prescribed by the department by rule.

30         Section 11.  Section 560.307, Florida Statutes, is

31  amended to read:

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  1         560.307  Fees.--

  2         (1)  The application shall be filed together with a

  3  nonrefundable application investigation fee of that shall be

  4  established by department rule; however, the investigation fee

  5  may not exceed $250 for each check casher or foreign currency

  6  exchanger and $50 for each authorized vendor or location

  7  operating within this state. Such investigation fee shall

  8  satisfy the fee requirement for the first year of registration

  9  or the remaining part thereof.

10         (2)  Within 60 days after the date a registrant either

11  opens a location within this state or authorizes an authorized

12  vendor to operate on the registrant's behalf within this

13  state, the registrant shall notify the department on a form

14  prescribed by the department by rule. The notification shall

15  be accompanied by a nonrefundable $50 fee for each authorized

16  vendor or location. This subsection shall not apply to any

17  authorized vendor or location that has been designated by the

18  registrant before October 1, 2001.

19         (3)  Within 60 days after the date a registrant closes

20  a location within this state or withdraws authorization for an

21  authorized vendor to operate on the registrant's behalf within

22  this state, the registrant shall notify the department on a

23  form prescribed by the department by rule.

24         Section 12.  Section 560.308, Florida Statutes, is

25  amended to read:

26         560.308  Registration terms; renewal; renewal fees.--

27         (1)  Registration pursuant to this part shall remain

28  effective through the remainder of the second calendar year

29  following its date of issuance unless during such calendar

30  year the registration is surrendered, suspended, or revoked.

31

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  1         (2)  The department shall renew registration upon

  2  receipt of a completed renewal form and payment of a

  3  nonrefundable renewal fee, as provided by rule, not to exceed

  4  $500. The completed renewal form and payment of the renewal

  5  fee shall occur on or after June 1 of the year in which the

  6  existing registration expires.

  7         (3)  In addition to the renewal fee required by

  8  subsection (2), each registrant must register and pay a 2-year

  9  $50 registration renewal fee of $50 for each authorized vendor

10  or location, including any authorized vendors, operating

11  within this state or, at the option of the registrant, a total

12  2-year renewal fee of $20,000 $5,000 may be paid to renew the

13  registration of register all such operating locations

14  currently registered at the time of renewal within this state.

15         (4)  Registration that is not renewed on or before the

16  expiration date of the registration period automatically

17  expires. A renewal application and fee, and a late fee of $250

18  an investigation fee pursuant to s. 560.307, must be filed

19  within 60 calendar days after the expiration of an existing

20  registration in order for the registration to before

21  registration may be reinstated. If the registrant has not

22  filed a renewal application within 60 days after the

23  expiration date of an existing registration, a new application

24  must be filed with the department pursuant to s. 560.307.

25         Section 13.  Part IV of chapter 560, Florida Statutes,

26  consisting of sections 560.401, 560.402, 560.403, 560.404,

27  560.405, 560.406, 560.407, and 560.408, Florida Statutes, is

28  created to read:

29                             PART IV

30                       DEFERRED PRESENTMENT

31

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  1         560.401  Short title.--This part may be cited as the

  2  "Deferred Presentment Act."

  3         560.402  Definitions.--In addition to the definitions

  4  provided in ss. 560.103, 560.202, and 560.302 and unless

  5  otherwise clearly indicated by the context, for purposes of

  6  this part:

  7         (1)  "Affiliate" means a person who directly or

  8  indirectly through one or more intermediaries controls or is

  9  controlled by, or is under common control with, a deferred

10  presentment provider.

11         (2)  "Business day" means the hours during a particular

12  day during which a deferred presentment provider customarily

13  conducts business, not to exceed 15 consecutive hours during

14  that day.

15         (3)  "Days" means calendar days.

16         (4)  "Deferment period" means the number of days a

17  deferred presentment provider agrees to defer depositing or

18  presenting a payment instrument.

19         (5)  "Deferred presentment provider" means a person who

20  engages in a deferred presentment transaction and is

21  registered under part II or part III of the code and has filed

22  a declaration of intent with the department.

23         (6)  "Deferred presentment transaction" means providing

24  currency or a payment instrument in exchange for a person's

25  check and agreeing to hold that person's check for a period of

26  time prior to presentment, deposit, or redemption.

27         (7)  "Drawer" means any person who writes a personal

28  check and upon whose account the check is drawn.

29         (8)  "Rollover" means the termination or extension of

30  an existing deferred presentment agreement by the payment of

31  any additional fee and the continued holding of the check, or

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  1  the substitution of a new check drawn by the drawer pursuant

  2  to a new deferred presentment agreement.

  3         (9)  "Fee" means the fee authorized for the deferral of

  4  the presentation of a check pursuant to this part.

  5         (10)  "Termination of an existing deferred presentment

  6  agreement" means that the check that is the basis for an

  7  agreement is redeemed by the drawer by payment in full in

  8  cash, or is deposited and the deferred presentment provider

  9  has evidence that such check has cleared.  A verification of

10  sufficient funds in the drawer's account by the deferred

11  presentment provider shall not be sufficient evidence to deem

12  the existing deferred deposit transaction to be terminated.

13         (11)  "Extension of an existing deferred presentment

14  agreement" means that a deferred presentment transaction is

15  continued by the drawer paying any additional fees and the

16  deferred presentment provider continues to hold the check for

17  another period of time prior to deposit, presentment, or

18  redemption.

19         560.403  Requirements of registration; declaration of

20  intent.--

21         (1)  No person, unless otherwise exempt from this

22  chapter, shall engage in a deferred presentment transaction

23  unless the person is registered under the provisions of part

24  II or part III and has on file with the department a

25  declaration of intent to engage in deferred presentment

26  transactions. The declaration of intent shall be under oath

27  and on such form as the department prescribes by rule.  The

28  declaration of intent shall be filed together with a

29  nonrefundable filing fee of $1,000. Any person who is

30  registered under part II or part III on the effective date of

31  this act and intends to engage in deferred presentment

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  1  transactions shall have 60 days after the effective date of

  2  this act to file a declaration of intent.

  3         (2)  A registrant under this part shall renew his or

  4  her intent to engage in the business of deferred presentment

  5  transactions or to act as a deferred presentment provider upon

  6  renewing his or her registration under part II or part III and

  7  shall do so by indicating his or her intent on the renewal

  8  form and by submitting a nonrefundable deferred presentment

  9  provider renewal fee of $1,000, in addition to any fees

10  required for renewal of registration under part II or part

11  III.

12         (3)  A registrant under this part who fails to timely

13  renew his or her intent to engage in the business of deferred

14  presentment transactions or to act as a deferred presentment

15  provider shall immediately cease to engage in the business of

16  deferred presentment transactions or to act as a deferred

17  presentment provider.

18         (4)  The notice of intent of a registrant under this

19  part who fails to timely renew his or her intent to engage in

20  the business of deferred presentment transactions or to act as

21  a deferred presentment provider on or before the expiration

22  date of the registration period automatically expires. A

23  renewal declaration of intent and fee, and a late fee of $500,

24  must be filed within 60 calendar days after the expiration of

25  an existing registration in order for the declaration of

26  intent to be reinstated. If the registrant has not filed a

27  renewal declaration of intent within 60 days after the

28  expiration date of an existing registration, a new declaration

29  must be filed with the department.

30         (5)  No person, other than a financial institution as

31  defined in s. 655.005, shall be exempt from registration and

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  1  declaration if such person engages in deferred presentment

  2  transactions, regardless of whether such person is currently

  3  exempt from registration under any provision of this code.

  4         560.404  Requirements for deferred presentment

  5  transactions.--

  6         (1)  Every deferred presentment transaction shall be

  7  documented in a written agreement signed by both the deferred

  8  presentment provider and the drawer.

  9         (2)  The deferred presentment transaction agreement

10  shall be executed on the day the deferred presentment provider

11  furnishes currency or a payment instrument to the drawer.

12         (3)  Each written agreement shall contain the following

13  information, in addition to any information the department

14  requires by rule:

15         (a)  The name or trade name, address, and telephone

16  number of the deferred presentment provider and the name and

17  title of the person who signs the agreement on behalf of the

18  deferred presentment provider.

19         (b)  The date the deferred presentment transaction was

20  made.

21         (c)  The amount of the drawer's check.

22         (d)  The length of deferral period.

23         (e)  The last day of the deferment period.

24         (f)  The address and telephone number of the

25  department.

26         (g)  A clear description of the drawer's payment

27  obligations under the deferred presentment transaction.

28         (h)  The transaction number assigned by the

29  department's database.

30

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  1         (4)  Every deferred presentment provider shall furnish

  2  to the drawer a copy of the deferred presentment transaction

  3  agreement.

  4         (5)  The face amount of a check taken for deferred

  5  presentment may not exceed $500 exclusive of the fees allowed

  6  by this part.

  7         (6)  No deferred presentment provider or its affiliate

  8  shall charge fees in excess of 10 percent of the currency or

  9  payment instrument provided. However, a verification fee may

10  be charged in accordance with s. 560.309(4) and the rules

11  adopted pursuant to the code. The 10-percent fee may not be

12  applied to the verification fee. A deferred presentment

13  provider may charge only those fees specifically authorized in

14  this section.

15         (7)  The fees authorized by this section may not be

16  collected before the drawer's check is presented or redeemed.

17         (8)  No deferred presentment agreement shall be for a

18  term in excess of 31 days or less than 7 days.

19         (9)  No deferred presentment provider shall require a

20  person to provide any additional security for the deferred

21  presentment transaction or any extension or require a person

22  to provide any additional guaranty from another person.

23         (10)  A deferred presentment provider shall not include

24  any of the following provisions in any written agreement:

25         (a)  A hold harmless clause;

26         (b)  A confession of judgment clause;

27         (c)  Any assignment of or order for payment of wages or

28  other compensation for services;

29         (d)  A provision in which the drawer agrees not to

30  assert any claim or defense arising out of the agreement; or

31         (e)  A waiver of any provision of this part.

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  1         (11)  Each deferred presentment provider shall

  2  immediately provide the drawer with the full amount of any

  3  check to be held, less only the fees permitted under this

  4  section.

  5         (12)  The deferred presentment agreement and drawer's

  6  check shall bear the same date, and the number of days of the

  7  deferment period shall be calculated from this date. No

  8  deferred presentment provider or person may alter or delete

  9  the date on any written agreement or check held by the

10  deferred presentment provider.

11         (13)  For each deferred presentment transaction, the

12  deferred presentment provider must comply with the disclosure

13  requirements of 12 C.F.R., Part 226, the federal

14  Truth-in-Lending Act, and Regulation Z of the Board of

15  Governors of the Federal Reserve Board. A copy of the

16  disclosure must be provided to the drawer at the time the

17  deferred presentment transaction is initiated.

18         (14)  No deferred presentment provider or its affiliate

19  may accept or hold an undated check or a check dated on a date

20  other than the date on which the deferred presentment provider

21  agreed to hold the check and signed the deferred presentment

22  transaction agreement.

23         (15)  Every deferred presentment provider shall hold

24  the drawer's check for the agreed number of days, unless the

25  drawer chooses to redeem the check before the agreed

26  presentment date.

27         (16)  Proceeds in a deferred presentment transaction

28  may be made to the drawer in the form of the deferred

29  presentment provider's payment instrument if the deferred

30  presentment provider is registered under part II; however, no

31  additional fee may be charged by a deferred presentment

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  1  provider or its affiliate for issuing or cashing the deferred

  2  presentment provider's payment instrument.

  3         (17)  No deferred presentment provider may require the

  4  drawer to accept its payment instrument in lieu of currency.

  5         (18)  No deferred presentment provider or its affiliate

  6  may engage in the rollover of any deferred presentment

  7  agreement. A deferred presentment provider shall not redeem,

  8  extend, or otherwise consolidate a deferred presentment

  9  agreement with the proceeds of another deferred presentment

10  transaction made by the same or an affiliated deferred

11  presentment provider.

12         (19)  A deferred presentment provider may not enter

13  into a deferred presentment transaction with a person who has

14  an outstanding deferred presentment transaction with that

15  provider or with any other deferred presentment provider, or

16  with a person whose previous deferred presentment transaction

17  with that provider or with any other provider has been

18  terminated for less than 24 hours. The deferred presentment

19  provider must verify such information as follows:

20         (a)  The deferred presentment provider shall maintain a

21  common database and shall verify whether that deferred

22  presentment provider or an affiliate has an outstanding

23  deferred presentment transaction with a particular person or

24  has terminated a transaction with that person within the

25  previous 24 hours.

26         (b)  The deferred presentment provider shall access the

27  department's database established pursuant to subsection (23)

28  and shall verify whether any other deferred presentment

29  provider has an outstanding deferred presentment transaction

30  with a particular person or has terminated a transaction with

31  that person within the previous 24 hours. Prior to the time

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  1  that the department has implemented such a database, the

  2  deferred presentment provider may rely upon the written

  3  verification of the drawer as provided in subsection (20).

  4         (20)  A deferred presentment provider shall provide the

  5  following notice in a prominent place on each deferred

  6  presentment agreement in at least 14-point type in

  7  substantially the following form and must obtain the signature

  8  of the drawer where indicated:

  9

10                              NOTICE

11         1.  STATE LAW PROHIBITS YOU FROM HAVING MORE

12         THAN ONE DEFERRED PRESENTMENT AGREEMENT AT ANY

13         ONE TIME. STATE LAW ALSO PROHIBITS YOU FROM

14         ENTERING INTO A DEFERRED PRESENTMENT AGREEMENT

15         WITHIN 24 HOURS OF TERMINATING ANY PREVIOUS

16         DEFERRED PRESENTMENT AGREEMENT. FAILURE TO OBEY

17         THIS LAW COULD CREATE SEVERE FINANCIAL HARDSHIP

18         FOR YOU AND YOUR FAMILY.

19

20         YOU MUST SIGN THE FOLLOWING STATEMENT:

21         I DO NOT HAVE AN OUTSTANDING DEFERRED

22         PRESENTMENT AGREEMENT WITH ANY DEFERRED

23         PRESENTMENT PROVIDER AT THIS TIME. I HAVE NOT

24         TERMINATED A DEFERRED PRESENTMENT AGREEMENT

25         WITHIN THE PAST 24 HOURS.

26         (Signature of Drawer)

27

28         2.  YOU CANNOT BE PROSECUTED IN CRIMINAL COURT

29         FOR A CHECK WRITTEN UNDER THIS AGREEMENT, BUT

30         ALL LEGALLY AVAILABLE CIVIL MEANS TO ENFORCE

31         THE DEBT MAY BE PURSUED AGAINST YOU.

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  1

  2         3.  STATE LAW PROHIBITS A DEFERRED PRESENTMENT

  3         PROVIDER (THIS BUSINESS) FROM ALLOWING YOU TO

  4         "ROLL OVER" YOUR DEFERRED PRESENTMENT

  5         TRANSACTION. THIS MEANS THAT YOU CANNOT BE

  6         ASKED OR REQUIRED TO PAY AN ADDITIONAL FEE IN

  7         ORDER TO FURTHER DELAY THE DEPOSIT OR

  8         PRESENTMENT OF YOUR CHECK FOR PAYMENT. IF YOU

  9         INFORM THE PROVIDER IN PERSON THAT YOU CANNOT

10         COVER THE CHECK OR PAY IN FULL THE AMOUNT OWING

11         AT THE END OF THE TERM OF THIS AGREEMENT, YOU

12         WILL RECEIVE A GRACE PERIOD EXTENDING THE TERM

13         OF THE AGREEMENT FOR AN ADDITIONAL 60 DAYS

14         AFTER THE ORIGINAL TERMINATION DATE, WITHOUT

15         ANY ADDITIONAL CHARGE. THE DEFERRED PRESENTMENT

16         PROVIDER SHALL REQUIRE THAT YOU, AS A CONDITION

17         OF OBTAINING THE GRACE PERIOD, COMPLETE

18         CONSUMER CREDIT COUNSELING PROVIDED BY AN

19         AGENCY INCLUDED ON THE LIST THAT WILL BE

20         PROVIDED TO YOU BY THIS PROVIDER. YOU MAY ALSO

21         AGREE TO COMPLY WITH AND ADHERE TO A REPAYMENT

22         PLAN APPROVED BY THAT AGENCY. IF YOU DO NOT

23         COMPLY WITH AND ADHERE TO A REPAYMENT PLAN

24         APPROVED BY THAT AGENCY, WE MAY DEPOSIT OR

25         PRESENT YOUR CHECK FOR PAYMENT AND PURSUE ALL

26         LEGALLY AVAILABLE CIVIL MEANS TO ENFORCE THE

27         DEBT AT THE END OF THE 60-DAY GRACE PERIOD.

28

29         (21)  The deferred presentment provider may not deposit

30  or present the drawer's check if the drawer informs the

31  provider in person that the drawer cannot redeem or pay in

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  1  full in cash the amount due and owing the deferred presentment

  2  provider. No additional fees or penalties may be imposed on

  3  the drawer by virtue of any misrepresentation made by the

  4  drawer as to the sufficiency of funds in the drawer's account.

  5  In no event shall any additional fees be added to the amounts

  6  due and owing to the deferred presentment provider.

  7         (22)(a)  If, by the end of the deferment period, the

  8  drawer informs the deferred presentment provider in person

  9  that the drawer cannot redeem or pay in full in cash the

10  amount due and owing the deferred presentment provider, the

11  deferred presentment provider shall provide a grace period

12  extending the term of the agreement for an additional 60 days

13  after the original termination date, without any additional

14  charge. The provider shall require that as a condition of

15  providing this grace period, that within the first 7 days of

16  the grace period the drawer make an appointment with a

17  consumer credit counseling agency within 7 days after the end

18  of the deferment period and complete the counseling by the end

19  of the grace period. The drawer may agree to, comply with, and

20  adhere to a repayment plan approved by the counseling agency.

21  If the drawer agrees to comply with and adhere to a repayment

22  plan approved by the counseling agency, the provider is also

23  required to comply with and adhere to that repayment plan. The

24  deferred presentment provider may not deposit or present the

25  drawer's check for payment before the end of the 60-day grace

26  period unless the drawer fails to comply with such conditions

27  or the drawer fails to notify the provider of such compliance.

28  Before each deferred presentment transaction, the provider may

29  verbally advise the drawer of the availability of the grace

30  period consistent with the provisions of the written notice in

31

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  1  subsection (20), and shall not discourage the drawer from

  2  using the grace period.

  3         (b)  At the commencement of the grace period, the

  4  deferred presentment provider shall provide the drawer:

  5         1.  Verbal notice of the availability of the grace

  6  period consistent with the written notice in subsection (20).

  7         2.  A list of approved consumer credit counseling

  8  agencies prepared by the department. The department shall

  9  prepare the list by October 1, 2001. The department list shall

10  include nonprofit consumer credit counseling agencies

11  affiliated with the National Foundation for Credit Counseling

12  which provide credit counseling services to Florida residents

13  in person, by telephone, or through the internet. The

14  department list must include phone numbers for the agencies,

15  the counties served by the agencies, and indicate the agencies

16  that provide telephone counseling and those that provide

17  internet counseling. The department shall update the list at

18  least once each year.

19         3.  The following notice in at least 14-point type in

20  substantially the following form:

21

22         AS A CONDITION OF OBTAINING A GRACE PERIOD

23         EXTENDING THE TERM OF YOUR DEFERRED PRESENTMENT

24         AGREEMENT FOR AN ADDITIONAL 60 DAYS, UNTIL

25         [date], WITHOUT ANY ADDITIONAL FEES, YOU MUST

26         COMPLETE CONSUMER CREDIT COUNSELING PROVIDED BY

27         AN AGENCY INCLUDED ON THE LIST THAT WILL BE

28         PROVIDED TO YOU BY THIS PROVIDER. YOU MAY ALSO

29         AGREE TO COMPLY WITH AND ADHERE TO A REPAYMENT

30         PLAN APPROVED BY THE AGENCY. THE COUNSELING MAY

31         BE IN-PERSON, BY TELEPHONE, OR THROUGH THE

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  1         INTERNET. YOU MUST NOTIFY US WITHIN SEVEN (7)

  2         DAYS, BY [DATE], THAT YOU HAVE MADE AN

  3         APPOINTMENT WITH SUCH A CONSUMER CREDIT

  4         COUNSELING AGENCY. YOU MUST ALSO NOTIFY US

  5         WITHIN SIXTY (60) DAYS, BY [DATE], THAT YOU

  6         HAVE COMPLETED THE CONSUMER CREDIT COUNSELING.

  7         WE MAY VERIFY THIS INFORMATION WITH THE AGENCY.

  8         IF YOU FAIL TO PROVIDE EITHER THE 7-DAY OR

  9         60-DAY NOTICE, OR IF YOU HAVE NOT MADE THE

10         APPOINTMENT OR COMPLETED THE COUNSELING WITHIN

11         THE TIME REQUIRED, WE MAY DEPOSIT OR PRESENT

12         YOUR CHECK FOR PAYMENT AND PURSUE ALL LEGALLY

13         AVAILABLE CIVIL MEANS TO ENFORCE THE DEBT.

14

15         (c)  If a drawer completes an approved payment plan,

16  the deferred presentment provider shall pay one-half of the

17  drawer's fee for the deferred presentment agreement to the

18  consumer credit counseling agency.

19         (23)  On or before March 1, 2002, the department shall

20  implement a common database with real-time access through an

21  internet connection for deferred presentment providers, as

22  provided in this subsection. The database must be accessible

23  to the department and the deferred presentment providers to

24  verify whether any deferred presentment transactions are

25  outstanding for a particular person. Deferred presentment

26  providers shall submit such data before entering into each

27  deferred presentment transaction in such format as the

28  department shall require by rule, including the drawer's name,

29  social security number or employment authorization alien

30  number, address, driver's license number, amount of the

31  transaction, date of transaction, the date that the

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  1  transaction is closed, and such additional information as is

  2  required by the department. The department may impose a fee

  3  not to exceed $1 per transaction for data required to be

  4  submitted by a deferred presentment provider. A deferred

  5  presentment provider may rely on the information contained in

  6  the database as accurate and is not subject to any

  7  administrative penalty or civil liability as a result of

  8  relying on inaccurate information contained in the database.

  9  The department may adopt rules to administer and enforce the

10  provisions of this section and to assure that the database is

11  used by deferred presentment providers in accordance with this

12  section.

13         560.405  Deposit; redemption.--

14         (1)  The deferred presentment provider or its affiliate

15  shall not present the drawer's check prior to the agreed-upon

16  date of presentment, as reflected in the deferred presentment

17  transaction agreement.

18         (2)  Before a deferred presentment provider presents

19  the drawer's check, the check shall be endorsed with the

20  actual name under which the deferred presentment provider is

21  doing business.

22         (3)  Notwithstanding the provisions of subsection (1),

23  in lieu of presentment, a deferred presentment provider may

24  allow the check to be redeemed at any time upon payment to the

25  deferred presentment provider in the amount of the face amount

26  of the drawer's check. However, payment may not be made in the

27  form of a personal check. Upon redemption, the deferred

28  presentment provider shall return the drawer's check that was

29  being held and provide a signed, dated receipt showing that

30  the drawer's check has been redeemed.

31

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  1         (4)  No drawer can be required to redeem his or her

  2  check prior to the agreed-upon date; however, the drawer may

  3  choose to redeem the check before the agreed-upon presentment

  4  date.

  5         560.406  Worthless checks.--If a check is returned to a

  6  deferred presentment provider from a payor financial

  7  institution due to lack of funds, a closed account, or a

  8  stop-payment order, the deferred presentment provider may seek

  9  collection pursuant to s. 68.065, except a deferred

10  presentment provider shall not be entitled to collect treble

11  damages pursuant s. 68.065. The notice sent by a deferred

12  deposit provider pursuant to s. 68.065 shall not include any

13  references to treble damages and must clearly state that the

14  deferred presentment provider is not entitled to recover such

15  damages. Except as otherwise provided in this part, an

16  individual who issues a personal check to a deferred

17  presentment provider under a deferred presentment agreement is

18  not subject to criminal penalty. If a check is returned to a

19  deferred presentment provider from a payor financial

20  institution due to insufficient funds, a closed account, or a

21  stop-payment order, the deferred presentment provider may

22  pursue all legally available civil remedies to collect the

23  check, including, but not limited to, the imposition of all

24  charges imposed on the deferred presentment provider by any

25  financial institution. In its collection practices, a deferred

26  presentment provider shall comply with the prohibitions

27  against harassment or abuse, false or misleading

28  representations, and unfair practices which are contained in

29  ss. 806, 807, and 808 of the Fair Debt Collections Practices

30  Act, 15 U.S.C. ss. 1692d, 1692e, 1692f. A violation of this

31  act is a deceptive and unfair trade practice and constitutes a

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  1  violation of the Deceptive and Unfair Trade Practices Act,

  2  part II, of chapter 501. In addition, a deferred presentment

  3  provider shall comply with the applicable provisions of part

  4  VI of chapter 559, the Consumer Collection Practices Act,

  5  including, but not limited to, the provisions of s. 559.77.

  6         560.407  Records.--

  7         (1)  Each registrant under this part must maintain all

  8  books, accounts, records, and documents necessary to determine

  9  the registrant's compliance with the provisions of the code.

10  Such books, accounts, records, and documents shall be retained

11  for a period of at least 3 years unless a longer period is

12  expressly required by the department, the laws of this state,

13  or any federal law.

14         (2)  The records required to be maintained by the code

15  or any rule adopted pursuant thereto may be maintained by the

16  registrant at any location within this state, provided that

17  the registrant notifies the department, in writing, of the

18  location of the records in its application or otherwise.

19         (3)  A registrant shall make records available to the

20  department for examination and investigation in this state, as

21  permitted by the code, within 7 days after receipt of a

22  written request.

23         (4)  The original of any record of a registrant

24  includes the data or other information comprising a record

25  stored or transmitted in or by means of any electronic,

26  computerized, mechanized, or other information storage or

27  retrieval or transmission system or device that can upon

28  request generate, regenerate, or transmit the precise data or

29  other information comprising the record.  An original also

30  includes the visible data or other information so generated,

31

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  1  regenerated, or transmitted if it is legible or can be made

  2  legible by enlargement or other process.

  3         560.408  Legislative intent; report.--

  4         (1)  It is the intent of the Legislature to provide for

  5  the regulation of deferred presentment transactions. It is

  6  further the intent of the Legislature to prevent fraud, abuse,

  7  and other unlawful activity associated with deferred

  8  presentment transactions in part by:

  9         (a)  Providing for sufficient regulatory authority and

10  resources to monitor deferred presentment transactions.

11         (b)  Preventing rollovers.

12         (c)  Regulating the allowable fees charged in

13  connection with a deferred presentment transaction.

14         (2)  The Comptroller shall submit a report to the

15  President of the Senate and the Speaker of the House of

16  Representatives on January 1, 2003, and January 1, 2004,

17  containing findings and conclusions concerning the

18  effectiveness of this act in preventing fraud, abuse, and

19  other unlawful activity associated with deferred presentment

20  transactions. The report may contain legislative

21  recommendations addressing the prevention of fraud, abuse, and

22  other unlawful activity associated with deferred presentment

23  transactions. Prior to filing the report, the Comptroller

24  shall consult with the Attorney General for the purpose of

25  including any recommendations or concerns expressed by the

26  Attorney General.

27         Section 14.  This act shall take effect October 1,

28  2001.

29

30

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  1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  2                       CS/CS/SB 1526 & 314

  3

  4  1)    Clarifies conditions related to the 60-day grace period:

  5        Drawer must inform the provider in person that they
          cannot repay the loan;
  6
          Must complete, not just attend, credit counseling;
  7
          Drawer may enter a payment plan approved by a credit
  8        counselor and the provider must also follow this plan;

  9        If the drawer does not agree to a payment plan the loan
          must be paid at the end of the grace period.
10
    2)    Clarifies that counseling may be accessed in person, by
11        telephone or by Internet.

12  3)    Specifies that verbal & written notice must be provided
          to the drawer at the beginning of the grace period
13
    4)    Specifies that the provider may attempt to discourage
14        use of the grace period

15  5)    Exempts persons engaged in the selling or issuing of
          payment instruments or in activity of a funds
16        transmitter from the registration fee requirements of s.
          560.307, F.S.
17

18

19

20

21

22

23

24

25

26

27

28

29

30

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