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A BILL TO BE ENTITLED
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AN ACT
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relating to the prohibition on participating in the lending of |
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credit by a credit services organization that assists a borrower in |
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obtaining the credit. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter D, Chapter 393, Finance Code, is |
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amended by adding Section 393.308 to read as follows: |
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Sec. 393.308. ACTING AS OR ASSOCIATING WITH LENDER. (a) A |
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credit services organization may not facilitate or assist in |
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obtaining credit for a consumer if: |
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(1) the organization is the lender; |
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(2) the organization or an officer, director, or |
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employee of the organization is in any way related to the lender or |
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an officer, director, or employee of the lender; |
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(3) the lender or the organization is an affiliate of |
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the other, or the lender and the organization are owned or |
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controlled by the same holding company; |
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(4) the organization retains or receives an economic |
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interest in the loan revenue; |
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(5) the organization services or collects the loan on |
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behalf of the lender; or |
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(6) the organization provides compensation to or |
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shares resources with the lender. |
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(b) A credit services organization may not use a scheme, |
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device, or contrivance to evade the application of this section. |
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SECTION 2. This Act takes effect September 1, 2007. |