By Carona H.B. No. 1615
74R5552 LJR-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the appeal of orders of and civil penalties assessed by
1-3 the consumer credit commissioner.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section (7), Article 2.03, Title 79, Revised
1-6 Statutes (Article 5069-2.03, Vernon's Texas Civil Statutes), is
1-7 amended to read as follows:
1-8 (7) Whenever the Consumer Credit Commissioner has reasonable
1-9 cause to believe that any person is violating any provisions of the
1-10 statutes to which this Article applies he may in addition to all
1-11 actions provided for, and without prejudice thereto, enter an order
1-12 requiring such person to desist or to refrain from such violation.
1-13 A person may appeal such an order to the Finance Commission. The
1-14 appeal must be made in accordance with Chapter 2001, Government
1-15 Code <rules adopted by the Finance Commission for that purpose>.
1-16 In addition to the order, the Commissioner may bring an action in
1-17 any district court of this State having jurisdiction and venue, on
1-18 the relation of the Attorney General at the request of the
1-19 Commissioner, to enjoin such person from engaging in or continuing
1-20 such violation or from doing any act or acts in furtherance
1-21 thereof. In any such action, an order or judgment may be entered
1-22 awarding such preliminary or final injunction as may be deemed
1-23 proper. In addition to all other means provided by law for the
1-24 enforcement of a restraining order or injunction, the court in
2-1 which such action is brought shall have power and jurisdiction to
2-2 impound, and to appoint a receiver for, the property and business
2-3 of the defendant, including books, papers, documents, and records
2-4 pertaining thereto or so much thereof as the court may deem
2-5 reasonably necessary to prevent violations through or by means of
2-6 the use of said property and business. Such receiver, when
2-7 appointed and qualified, shall have such powers and duties as he
2-8 would have under Chapter 64, Civil Practice and Remedies Code.
2-9 SECTION 2. Title 79, Revised Statutes (Article 5069-1.01 et
2-10 seq., Vernon's Texas Civil Statutes), is amended by adding Article
2-11 2.03A to read as follows:
2-12 Art. 2.03A. ADMINISTRATIVE PENALTY; RESTITUTION ORDER. (a)
2-13 The consumer credit commissioner may assess an administrative
2-14 penalty against a person who knowingly and wilfully violates or
2-15 causes a violation of this subtitle, Chapter 9 or 15 of this title,
2-16 or a rule adopted under this subtitle or Chapter 9 or 15 of this
2-17 title. The commissioner may order a person who violates or causes
2-18 a violation of this subtitle, Chapter 9 or 15 of this title, or a
2-19 rule adopted under this subtitle or Chapter 9 or 15 of this title
2-20 to make restitution to an identifiable person injured by the
2-21 violation.
2-22 (b) The amount of an administrative penalty may not exceed
2-23 $1,000 for each day of violation and for each act of violation.
2-24 The aggregate amount of penalties that may be assessed against a
2-25 person during one calendar year under this article may not exceed
2-26 $5,000 for each business location at which an element of a
2-27 violation occurred and may not exceed $50,000 if the person
3-1 committed violations at 11 or more business locations.
3-2 (c) In determining the amount of an administrative penalty,
3-3 the commissioner shall consider:
3-4 (1) the seriousness of the violation, including the
3-5 nature, circumstances, extent, and gravity of the prohibited act;
3-6 (2) the extent of actual or potential harm to a third
3-7 party;
3-8 (3) the history of violations;
3-9 (4) the amount necessary to deter future violations;
3-10 (5) efforts to correct the violation; and
3-11 (6) any other matter that justice may require.
3-12 (d) If the commissioner determines that a violation
3-13 occurred, the commissioner may issue a report that states the facts
3-14 on which the determination is based and the commissioner's
3-15 recommendation on imposition of a penalty, including a
3-16 recommendation on the amount of the penalty.
3-17 (e) Not later than the 14th day after the date on which a
3-18 report is issued, the commissioner shall give written notice of the
3-19 report to the person charged with committing or causing the
3-20 violation. The notice may be given by certified mail. The notice
3-21 must include a brief summary of the alleged violation and a
3-22 statement of the amount of the recommended penalty and must inform
3-23 the person that the person has a right to a hearing on the
3-24 occurrence of the violation, the amount of the penalty, or both the
3-25 occurrence of the violation and the amount of the penalty.
3-26 (f) Not later than the 20th day after the date on which a
3-27 person receives notice under Subsection (e), the person may:
4-1 (1) in writing accept the determination and
4-2 recommended penalty of the commissioner; or
4-3 (2) make a written request for a hearing on the
4-4 occurrence of the violation, the amount of the penalty, or both the
4-5 occurrence of the violation and the amount of the penalty.
4-6 (g) If the person accepts the determination and recommended
4-7 penalty of the commissioner, the commissioner by order shall
4-8 approve the determination and impose the recommended penalty.
4-9 (h) If the person requests a hearing or fails to respond
4-10 timely to the notice, the commissioner shall set a hearing and give
4-11 notice of the hearing to the person. The hearing shall be held by
4-12 an administrative law judge of the State Office of Administrative
4-13 Hearings. The administrative law judge shall make findings of fact
4-14 and conclusions of law and promptly issue a proposal for a decision
4-15 about the occurrence of the violation and the amount of a proposed
4-16 penalty. Based on the findings of fact, conclusions of law, and
4-17 proposal for a decision, the commissioner by order may find that a
4-18 violation has occurred and impose a penalty or may find that no
4-19 violation occurred.
4-20 (i) The notice of the commissioner's order given to the
4-21 person under Chapter 2001, Government Code, must include a
4-22 statement of the right of the person to judicial review of the
4-23 order.
4-24 (j) Judicial review of the order of the commissioner:
4-25 (1) is instituted by filing a petition as provided by
4-26 Subchapter G, Chapter 2001, Government Code; and
4-27 (2) is under the substantial evidence rule.
5-1 (k) If the court sustains the occurrence of the violation,
5-2 the court may uphold or reduce the amount of the penalty and order
5-3 the person to pay the full or reduced amount of the penalty. If
5-4 the court does not sustain the occurrence of the violation, the
5-5 court shall order that no penalty is owed.
5-6 (l) When the judgment of the court becomes final, the court
5-7 shall proceed under this subsection. If the person paid the amount
5-8 of the penalty and if that amount is reduced or is not upheld by
5-9 the court, the court shall order that the appropriate amount plus
5-10 accrued interest be remitted to the person. The rate of the
5-11 interest is the rate authorized by Article 1.05 of this title, and
5-12 the interest shall be paid for the period beginning on the date the
5-13 penalty was paid and ending on the date the penalty is remitted.
5-14 (m) In addition to the administrative penalty or restitution
5-15 amount, the court may authorize the commissioner to recover from a
5-16 person who pays an administrative penalty or restitution amount, or
5-17 both, under this article reasonable expenses incurred in obtaining
5-18 the ordered amount, including investigation costs, witness fees,
5-19 and deposition expenses.
5-20 (n) A penalty collected under this article shall be
5-21 deposited to the credit of the general revenue fund.
5-22 (o) All proceedings under this section are subject to
5-23 Chapter 2001, Government Code.
5-24 (p) An administrative penalty or restitution order
5-25 authorized by this article is in addition to any other enforcement
5-26 authority provided by law.
5-27 SECTION 3. Article 8.03, Title 79, Revised Statutes (Article
6-1 5069-8.03, Vernon's Texas Civil Statutes), is amended to read as
6-2 follows:
6-3 Art. 8.03. ENGAGING IN LENDING BUSINESS WITHOUT LICENSE. In
6-4 addition to the foregoing penalties, if applicable, any person
6-5 engaging in any business under the scope of Chapter <Chapters> 3,
6-6 4, <or> 5, or 15 of this Title <Subtitle> without first securing a
6-7 license provided, or without the authorization prescribed, in such
6-8 Chapter shall be guilty of a misdemeanor and upon conviction
6-9 thereof shall be punishable by a fine of not more than One Thousand
6-10 Dollars, and each such loan made without the authority granted by
6-11 such license shall constitute a separate offense punishable
6-12 hereunder; and in addition such person shall forfeit all principal
6-13 and charges contracted for or collected on each such loan, and
6-14 shall pay reasonable attorneys' fees incurred by the obligor.
6-15 SECTION 4. This Act applies only to acts done and
6-16 transactions entered into on or after the effective date of this
6-17 Act. Acts done and transactions entered into before the effective
6-18 date of this Act are governed by the law in effect immediately
6-19 before this Act takes effect and that law continues in effect for
6-20 that purpose.
6-21 SECTION 5. This Act takes effect September 1, 1995.
6-22 SECTION 6. The importance of this legislation and the
6-23 crowded condition of the calendars in both houses create an
6-24 emergency and an imperative public necessity that the
6-25 constitutional rule requiring bills to be read on three several
6-26 days in each house be suspended, and this rule is hereby suspended.