Bill Text: DE HB72 | 2009-2010 | 145th General Assembly | Draft
Bill Title: An Act To Amend Chapter 27 Of Title 21 Of The Delaware Code Relating To Driver License Requirements For Registered Sex Offenders.
Spectrum: Bipartisan Bill
Status: (Passed) 2009-07-24 - Signed by Governor [HB72 Detail]
Download: Delaware-2009-HB72-Draft.html
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SPONSOR: |
Rep. Keeley & Sen. Marshall |
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Reps. Brady, Heffernan, Mitchell, Schooley, B. Short, Viola; Sens. Bonini, Sorenson |
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HOUSE OF REPRESENTATIVES 146th GENERAL ASSEMBLY |
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HOUSE BILL NO. 72 |
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AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE RELATING TO DEBT MANAGEMENT SERVICES. |
Section 1.Amend §2402A(6), Title 6 of the Delaware Code by deleting the period at the end ofthe definition for "Certified counselor" and adding at the end the following:
"in which an agreement contemplates that creditors will reduce finance charges or fees for late payment, default, or delinquency.".
Section 2.Amend §2402A(6), Title 6 of the Delaware Code by designatingthe definition of "Certified counselor" as subparagraph (A) and adding a new subparagraph (B) as follows:
"(B) "Certified debt specialist" means an individual certified by a training program or certifying organization, approved by the Attorney General, that authenticates the competence of individuals providing education and assistance to other individuals in connection with debt-management services in which an agreement contemplates that creditors will settle debts for less than the full principal amount of debt owed.".
Section 3.Amend §2402A, Title 6 of the Delaware Code by adding a new definition for a "lead generator" as §2402A(12) as provided below and then renumbering sequentially the definitions that follow:
"(12) ‘‘Lead generator'' means a person who supplies a provider with the names of potential customers, directs communications of an individual to a provider, or otherwise channels customers to a provider.".
Section 4.Amend §2402A, Title 6 of the Delaware Code by deleting the definition for "Trust account" in paragraph (20) and substituting in lieu thereof the following:
"(21) "Trust account'' means an account to be used for payment of a provider's fees or for payment to creditors pursuant to a plan, or both.".
Section 5.Amend §2405A(b)(3), Title 6 of the Delaware Code by deleting the paragraph in its entirety and substituting in lieu thereof the following:
"(3) Identification of all trust accounts and an irrevocable consent authorizing the Attorney General to review and examine the trust accounts;".
Section 6.Amend §2405A(b)(4), Title 6 of the Delaware Code by deleting the paragraph in its entirety and substituting in lieu thereof the following:
"(4) Evidence of insurance in the amount of $250,000:
(A) Against the risks of dishonesty, fraud, theft, and other misconduct on the part of the applicant or a director, employee, or agent of the applicant;
(B)Issued by an insurance company authorized to do business in this State and rated at least "A" or equivalent by a nationally recognized rating organization approved by the Attorney General;
(C)With a deductible not exceeding $5,000;
(D)Payable for the benefit of the applicant, this State, and individuals who are residents of this State, as their interests may appear; and
(E)Not subject to cancellation by the applicant or the insurer until 60 days after written notice has been given to the Attorney General.".
Section 7.Amend §2406A(7), Title 6 of the Delaware Code by adding a semicolon [;] after the word "account" and deleting the language "required by §2422A of this title;".
Section 8.Amend §2406A(10), Title 6 of the Delaware Code by adding the words "or certified debt specialist" after the words "a certified counselor".
Section9.Amend §2406A(15), Title 6 of the Delaware Code by deleting the language "the trust account required by §422A of this title;" and substituting in lieu thereof the language "a trust account;".
Section 10.Amend §2409A(a), Title 6 of the Delaware Code by deleting the reference to subsections "(b) and (c)" and substituting in lieu thereof a reference to "(c) and (d)".
Section 11.Amend §2409A, Title 6 of the Delaware Code by re-lettering current subsection (b) as "(c)", current subsection (c) as "(d)", and current subsection (d) as "(e)" and then changing the internal reference in subsection (e) from (c) to "(d)".
Section 12. Amend §2409A, Title 6 of the Delaware Code by inserting a new subsection (b) as follows:
"(b) If an applicant has otherwise complied with §2405A and §2406A, including a timely effort to obtain the information require by §2406A(15) of this chapter but the information has not beenreceived, the Attorney General may issue a temporary license.The temporary license shall expire no later than 180 days after issuance.".
Section 13.Amend §2411A(b)(4), Title 6 of the Delaware Code by replacing the semicolon [;] after the words "as applicable" with a period [.] and adding thereafternew sentences at the end of paragraph (4) as follows:
"If an application is otherwise complete and the applicant has made a timely effort to obtain the information required by §2406A(15) of this chapter but the information has not been received, the Attorney General may issue a temporary license. The temporary license shall expire no later than 180 days after issuance;".
Section 14.Amend §2411A(b)(5), Title 6 of the Delaware Code by deleting the paragraph in its entirety and substituting in lieu thereof the following:
"(5) Supply evidence of insurance in the amount equal to the larger of $250,000 or the highest daily balance in each trust account of this chapter during the 6-month period immediately preceding the application:
(A) Against the risks of dishonesty, fraud, theft, and other misconduct on the part of the applicant or a director, employee, or agent of the applicant;
(B)Issued by an insurance company authorized to do business in this State and rated at least "A" or equivalent by a nationally recognized rating organization approved by the Attorney General;
(C)With a deductible not exceeding $5,000;
(D)Payable for the benefit of the applicant, this State, and individuals who are residents of this State, as their interests may appear; and
(E)Not subject to cancellation by the applicant or the insurer until 60 days after written notice has been given to the Attorney General.".
Section 15.Amend §2411A(b)(6), Title 6 of the Delaware Code by inserting the words "deposited in trust accounts or"between the words "money" and "received".
Section 16.Amend §2416A, Title 6 of the Delaware Code by inserting a comma [,] after the words "certified counselor" followed by the language "certified debt specialist,".
Section 17.Amend §2417A(b), Title 6 of the Delaware Code by inserting immediately after the words "a certified counselor" the words "or certified debt specialist".
Section 18.Amend §2417A(d), Title 6 of the Delaware Code by deleting the words "to engage in a plan".
Section 19.Amend §2417A(d)(5), Title 6 of the Delaware Code by deleting the word "and".
Section 20.Amend §2417(A)(d)(6), Title 6 of the Delaware Code by deleting the period [.] at the end thereof and substituting in lieu thereof a semicolon [;] followed by the word "and".
Section 21.Amend §2417A(d), Title 6 of the Delaware Code by adding a new paragraph (7) as follows:
"(7) If the agreement contemplates that creditors will settle debts for less than the full principal amount of debt owed, that not all creditors will agree to accept a reduction in the amount of the debt.".
Section 22.Amend §2417A(e), Title 6 of the Delaware Code by deleting the words "hurt your credit rating or credit scores" as they appear inparagraph (2) of the notice designated "IMPORTANT INFORMATION FOR YOU TO CONSIDER" and substituting in lieu thereof the words "make it harder for you to obtain credit".
Section 23.Amend §2417A(f), Title 6 of the Delaware Code by deleting the words "hurt your credit rating or credit scores" as they appear in paragraph (2) of the notice designated "IMPORTANT INFORMATION FOR YOU TO CONSIDER"and substituting in lieu thereof the words "make it harder for you to obtain credit".
Section 24.Amend §2417A(g), Title 6 of the Delaware Code by deleting the words "a plan" and substituting in lieu thereof the words "an agreement".
Section25.Amend §2417A(g), Title 6 of the Delaware Code by deleting paragraph (1) of the notice designated "IMPORTANT INFORMATION FOR YOU TO CONSIDER" and substituting in lieu thereof the following:
"(1) Our program is not right for all individuals, and you may ask us to provide information about bankruptcy and other ways to deal with your debts.Not all creditors will agree to accept a reduction in the amount of debt.".
Section 26.Amend §2418A(d)(2), Title 6 of the Delaware Code by deleting the words "a plan" and substituting in lieu thereof the words "an agreement".
Section 27.Amend §2418A(f), Title 6 of the Delaware Code by deleting the words "a plan" as they appear twice therein and substituting in lieu thereof each time the words "an agreement".
Section 28.Amend §2419(a)(6)(H), Title 6 of the Delaware Codeby deleting the words "cancel the agreement as provided in §420A of this title" and substituting in lieu thereof the words "terminate the agreement at any time, by giving written or electronic notice, in which event the individual will receive all unexpended money in the trust account".
Section 29.Amend §2419A(d), Title 6 of the Delaware Code by deleting paragraph (1) in its entiretyand renumbering paragraphs (2) and (3) as "(1)" and "(2)", respectively.
Section 30.Amend §2419A, Title 6 of the Delaware Code by deleting subsection (e) in its entirety and substituting in lieu thereof the following:
"(e) An agreement may not confer a power of attorney to settle a debt, but may confer a power of attorney to negotiate with creditors for the individual on behalf of the individual.An agreement must provide that the provider will obtain the assent of the individual after a creditor has assented to a settlement.".
Section 31.Amend §2419A, Title 6 of the Delaware Code by deleting subsection (g) and substituting in lieu thereof the following:
"(g) A provision in an agreement which violates subsection (e) or (f) is void.".
Section 32.Amend §2420A, Title 6 of the Delaware Code by deleting the section in its entirety and substituting in lieu thereof the following:
"§2420A. Termination of agreement.
(a)An individual may terminate an agreement at any time, without penalty or obligation, by giving the provider written or electronic notice.
(b)A provider may terminate an agreement if an individual fails for 60 days to make payments required by the agreement or for other good cause.
(c)In the event of termination for any reason:
(1) the provider shall, within seven business days of the termination, pay all money that the provider, its agent, or person administering a trust account has received from or on behalf of the individual, other than amounts properly disbursed to creditors or received pursuant to§2423A; and
(2) all powers of attorney granted by the individual to the provider are revoked and ineffective.".
Section 33.Amend §2422A, Title 6 of the Delaware Code by deleting subsections (a) and (b) in their entirety and substituting in lieu thereof the following:
"(a) All money paid to a provider by or on behalf of an individual for distribution to creditors pursuant to a plan is held in trust.Within two business days after receipt, the provider shall deposit the money in a trust account.
(b)A provider may request or require an individual to place money in a trust account.
(c)A trust account must be at an insured bank and, unless the individual owns the account, must:
(i)be designated as a trust account or other account designated to indicate that the money in the account is not the money of the provider or its designee;
(ii)be administered by an entity that is not
(A) the provider or
(B)an affiliate of the provider; and
(iii) provide that any interest accruing on the individual's funds in the account is credited to the individual.
(d)A person administering a trust account may not give or accept any compensation from the provider in exchange for referrals of business involving debt-management services.
(e)Upon termination of an agreement, a person administering a trust account shall, within seven business days of the termination, pay the individual all money received by or on behalf of the individual, other than amounts it has properly disbursed to creditors or the provider.
(f)Money in a trust account is not property of the provider or the person administering the account. The money belongs to the individual from whom or on whose behalf it was deposited and is not available to creditors of the person administering the account or creditors of the provider.".
Section 34.Amend §2422A, Title 6 of the Delaware Code by deleting the language "(c) A provider shall:" and substituting in lieu thereofthe language "(g)A person administering a trust account shall:".
Section 35.Amend §2422A(c)(2)(A), Title 6 of the Delaware Code by substituting the word "person" for the word "provider" each time it appears in current paragraph (c) that is changed to paragraph "(g)" pursuant to Section 34 herein.
Section 36. Amend §2422A, Title 6 of the Delaware Code by deleting current subsection (d) and substituting in lieu thereof the following:
"(h) A provider or person administering a trust account may not include in the trust account money of individuals other than those to whom the provider is furnishing debt-management services.".
Section 37.Amend §2422A, Title 6 of the Delaware Code by re-lettering current subsection (e) as subsection "(i)".
Section 38.Amend §2422A, Title 6 of the Delaware Code by re-lettering current subsection (f) as subjection "(j)" and deleting the words "If a provider has established a trust account pursuant to subsection (a) of this section, the provider shall" and substituting in lieu thereof the words "A person administering a trust account shall".
Section 39.Amend §2422A, Title 6 of the Delaware Code by re-lettering current subsection (g) as "(k)" and adding each time the words "or person administering a trust account" following the word "provider" as is appears two times in the first sentence.
Section 40.Amend §2422A, Title 6 of the Delaware Code by deleting the current subsection (h).
Section 41.Amend §2422A, Title 6 of the Delaware Code by re-lettering current subsection (i) as "(l)" and deleting the word "provider" as it appears two times therein and each time inserting in lieu thereof the words "person administering the account".
Section 42.Amend §2423A, Title 6 of the Delaware Code by deleting subsection (d) in its entirety and substituting in lieu thereof the following:
"(d) Subject to adjustment of dollar amounts pursuant to §2432A(f), the following rules apply:
(1)Subject to paragraph (2), if an individual assents to a plan that contemplates that creditors will reduce finance charges or fees for late payment, default, or delinquency, the provider may charge a fee not exceeding $50 for consultation, obtaining a credit report, setting up an account, and the like.
(2)A provider may not request or receive any compensation from or on behalf of an individual unless:
(A)the provider has secured the assent of the individual and at least one creditor of the individual to a change in terms of a debt, and
(B)the individual has made a payment toward satisfying the modified terms of the debt.
(3)Subject to subsection (d)(1), if an individual assents to a plan that contemplates that creditors will reduce finance charges or fees for late payment, default, or delinquency, the provider may receive compensation in the form of a monthly service fee, not to exceed $10 times the number of creditors remaining in a plan at the time the fee is assessed, but not more than $50 in any month.
(4)Except as otherwise provided in subsection (c), if an agreement contemplates that creditors will settle an individual's debts for less than the principal amount of the debt:
(A) compensation for services in connection with settling a debt may not exceed, with respect to each debt, 30 percent of the excess of the principal amount of the debt over the amount paid the creditor pursuant to the agreement, and
(B) if the debt is to be settled by installment payments,
(i) the provider may receive this compensation in installments, made simultaneously with the individual's installment payments to the creditor, but
(ii) any such installment of the compensation may not be a greater percentage of the provider's total compensation for settlement of that debt than the simultaneous payment to the creditor is of the entire settlement amount for that debt.
(5)A provider that receives fees under paragraph (4) may not also impose or receive fees under paragraphs (1) or (3).
(6)Except as otherwise provided in §2428A(d), if an individual does not assent to an agreement, a provider may receive for educational and counseling services it provides to the individual a fee not exceeding $100 or, with the approval of the Attorney General, a larger fee.The Attorney General may approve a fee larger than $100 if the nature and extent of the educational and counseling services warrant the larger fee.".
Section 43.Amend §2423A(e) , Title 6, of the Delaware Code by changing the reference therein from (d)(4) to "(d)(5)".
Section 44.Amend §2426A, Title 6 of the Delaware Code by deleting the provisions in their entirety and denoting the section as "[RESERVED]".
Section 45.Amend §2428A, Title 6 of the Delaware Code by deleting the language "for more than 50 percent of the amount of the debt owed a creditor," in subparagraph (a)(2).
Section 46.Amend §2428A(a)(3), Title 6 of the Delaware Codeby deleting the language ", unless the power of attorney expressly limits the provider's authority to settle debts for not more that 50 percent of the amount of the debt owed a creditor".
Section 47.Amend §2428A(a)(5)(B)(i), Title 6 of the Delaware Code by deleting the words "a plan" and substituting in lieu thereof the words "an agreement".
Section 48.Amend §2428A, Title 6 of the Delaware Code by deleting paragraph (7) and substituting in lieu thereof the following:
"(7)Offer, pay, or give a gift or bonus, premium, reward, or other compensation to a lead generator or other person for referring a prospective customer, if the person making the referral:
(A) has a financial interest in the outcome of debt-management services provided to the customer, unless neither the provider nor the person making the referral communicates to the prospective customer the identity of the source of the referral, or
(B) compensates its employees on the basis of a formula that incorporates the number of individuals the employee refers to the provider;".
Section 49.Amend §2428A, Title 6 of the Delaware Code by deleting paragraph (a)(14) in its entirety and substituting in lieu thereof the following:
"(14) Represent in its agreements, disclosures required by this chapter, advertisements, or Internet web site that it is:
(A)a not-for-profit entity unless it is organized and properly operating as a not-for-profit entity under the law of the state in which it was formed; or
(B)a tax-exempt entity unless it has received certification of tax-exempt status from the Internal Revenue Service and is properly operating as a not-for-profit entity under the law of the state in which it was formed;".
Section 50.Amend §2430A, Title 6 of the Delaware Code by deleting the section in its entirety and substituting in lieu thereof the following:
"§ 2430A. Advertising.
(a)If the agreements of a provider contemplate that creditors will reduce finance charges or fees for late payment, default, or delinquency and the provider advertises debt-management services, it shall disclose, in an easily comprehensible manner, that using a debt-management plan may make it harder for the individual to obtain credit.
(b)If the agreements of a provider contemplate that creditors will settle for less than the full principal amount of debt and the provider advertises debt-management services, it shall disclose, in an easily comprehensible manner, the information specified in §2417A(d)(3) and (4) of this chapter.".
Section 51.Amend §2431A, Title 6 of the Delaware Code by designating the current paragraph as "(a)" and adding a new paragraph "(b)" as follows:
"(b) A lead generator or other person that provides services to or for a provider may not engage in an unfair, unconscionable, or deceptive act or practice, including the knowing omission of any material information, in its interactions with an individual whom it has reason to believe is or may become a customer of the provider.".
Section 52.Amend §2432A(c), Title 6 of the Delaware Code by deleting the language "required by §2422A of this title".
Section 53.Amend §2433A, Title 6 of the Delaware Code by adding the language ", a lead generator, a person administering a trust account," following the word "provider" as it appears each time in paragraphs (a)(1) and (a)(2).
Section 54.Amend§2433A(3), Title 6 of the Delaware Code by deleting the words "a person that has caused a violation" with "other person that has violated or caused a violation".
Section 55.Amend §2433A, Title 6 of the Delaware Code by adding twonew paragraphs designated"(h)" and "(i)" as follows:
"(h) The administrative procedures and remedies provided herein are not affected by the administrative procedures and remedies in 29 Del. C. §2517 et seq.
(i) Any party against whom a decision has been decided may appeal such decision to the Superior Court within 30 days of the day the notice of the decision was mailed.Such appeal shall be on the record without a trial de novo.".
Section 56.Amend §2434A, Title 6 of the Delaware Code by deleting paragraph (4) of subsection (b) and substituting in lieu thereof:
"(4) The provider, an employee or affiliate of the provider, a lead generator, a person administering a trust account, or a person to which the provider has delegated its obligations under an agreement or this chapter has refused to permit the Attorney General to make an examination authorized by this chapter; or".
Section 57.Amend §2434A, Title 6 of the Delaware Code by deleting the reference to §2422A(f) in subsection (c) and substituting in lieu thereof the reference "§422A(h)-(i)".
Section 58.Amend §2434A, Title 6 of the Delaware Code by deleting the language "required by §2422A of this title" in subsection (d).
Section 59.Amend §2435A, Title 6 of the Delaware Code by adding the words "or other person" after the word "provider" as it first appears in paragraph (c) and the language ", that person," after the word "provider" as it appears the second time in paragraph (c).
Section 60.Amend §2435A, Title 6 of the Delaware Code by deleting in its entirety paragraph (e) and re-lettering paragraphs (f) and (g) as "(e)" and "(f)", respectively.
Section 61.This Act becomes effective six months after its enactment into law.
SYNOPSIS
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The Delaware Debt Management Services Act was modeled after the uniform act developed by the National Council of Commissioners on Uniform Laws (NCCUSL).This Bill incorporates the 2008 changes for consistency with other states adopting the uniform act.Changes include a definition for a "certified debt specialist" and a provision for a temporary license when a criminal history has not yet been received. In addition, in 2010 the Federal Trade Commission made changes to the telemarketing act that prohibits the collecting of advance fees by debt settlement companies.This bill incorporates changes to the uniform act by NCCUSL so that the provisions are consistent with federal regulation and no advance fees can be collected.Regulation of trust accounts is broader. The changes also make fee caps consistent with the uniform act. Sections 6 and 14 incorporate the NCCUSL language in the insurance provisions. Sections 18 and 22 provide new disclosure language for debt settlement providers. The added disclosure informs individuals that not all creditors will agree to reduce the principal amount of the debt in a debt settlement plan. Section 55 clarifies that these administrative procedures were not superseded by the provisions in Chapter 25 of Title 29 and adds a provision for an appeal of an administrative decision on the record to the Superior Court. |
