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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of a person who offers, services, or |
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brokers a deferred presentment transaction. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter M, Chapter 342, Finance Code, is |
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amended by adding Sections 342.607, 342.608, and 342.609 to read as |
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follows: |
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Sec. 342.607. DEFERRED PRESENTMENT TRANSACTION DATA |
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COLLECTION SYSTEM. (a) A person who offers, services, or brokers a |
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deferred presentment transaction, including a credit services |
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organization to which Chapter 393 applies and a person registered |
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or licensed to do business in this state, who offers deferred |
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presentment transactions on the Internet, shall submit data to a |
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database established by a database provider selected by the |
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commissioner. |
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(b) The commissioner shall contract with a person to |
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establish a database for the compilation of information from |
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persons who offer, service, or broker deferred presentment |
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transactions. In selecting a database provider, the commissioner |
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shall ensure that the database provided by the person: |
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(1) provides access to the database by persons |
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required to submit information, through an Internet connection and |
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alternative methods, including by telephone, that enables the |
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persons to submit information as required by this section; |
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(2) provides real-time access by the commissioner to |
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information contained in the database; |
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(3) allows a person submitting information to access |
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only information relating to: |
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(A) that person; and |
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(B) the eligibility of an individual to enter |
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into a deferred presentment transaction under this chapter or rules |
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adopted under this chapter; and |
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(4) contains safeguards to ensure that confidential |
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information contained in the database may not be accessed by an |
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unauthorized person. |
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(c) A person required to submit data under this subchapter |
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shall weekly submit to the database provider: |
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(1) the amount of cash advanced under each deferred |
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presentment transaction made, serviced, or brokered by the person |
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during the preceding week; |
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(2) the amount of transactions made, serviced, or |
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brokered by the person that were outstanding on the last day of the |
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preceding week; |
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(3) the total number of transactions renewed during |
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the preceding week; |
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(4) any alternative payment arrangements that the |
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person offers; |
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(5) the average monthly income of an individual to |
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whom a cash advance is made under a deferred presentment |
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transaction, if the person collects that information from |
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individuals; and |
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(6) the total amount of interest, fees, or charges |
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collected by the person during the preceding week for making, |
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servicing, or brokering a deferred presentment transaction. |
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(d) The commissioner shall analyze the data reported under |
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this subchapter and prepare a report to the legislature. The |
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commissioner shall submit the report not later than February 1 of |
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each year. |
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(e) Information submitted to the database is the property of |
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the office of the consumer credit commissioner. Information that |
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personally identifies an individual is not subject to disclosure |
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under Chapter 552, Government Code. |
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(f) The finance commission may adopt rules as necessary to |
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implement this section. |
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Sec. 342.608. CERTIFICATION REQUIRED. (a) A person may not |
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offer, service, or broker a deferred presentment transaction unless |
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the person is certified by the commissioner. The requirement of |
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certification under this section is in addition to any license |
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required under this chapter or other law. |
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(b) To be certified by the commissioner, a person must: |
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(1) submit an application to the commissioner on a |
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form prescribed by the commissioner; |
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(2) submit an investigation fee of $2,500 to the |
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commissioner, if the person has not previously been certified by |
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the commissioner; |
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(3) submit a certification fee of $1,000 for the |
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initial or renewal certification; |
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(4) have not less than $1 million in assets, |
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calculated according to generally accepted accounting principles; |
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and |
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(5) submit a bond as required by Section 342.609. |
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(c) A person must annually renew the person's certification |
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under this section. |
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(d) The commissioner shall use proceeds from the fees |
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imposed under this section for the regulation of persons who offer, |
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service, or broker deferred presentment transactions, including |
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the monitoring and analysis of data submitted to the database under |
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Section 342.607. |
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Sec. 342.609. BOND REQUIRED. (a) In addition to any other |
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bond required by this chapter or other law, a person who offers, |
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services, or brokers a deferred presentment transaction shall file |
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with the application for certification a bond that is: |
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(1) in the amount of $1 million; and |
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(2) issued by a surety company qualified to do |
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business as a surety in this state. |
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(b) The bond must be in favor of this state for the use of |
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this state and the use of another person who has a cause of action |
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under this chapter against the person. |
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(c) The bond must be conditioned on: |
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(1) the person's faithful performance under this |
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chapter and rules adopted under this chapter; and |
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(2) the payment of all amounts that become due to the |
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state or another person under this chapter during the calendar year |
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for which the bond is given. |
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(d) The aggregate liability of a surety to all persons |
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damaged by the license holder's violation of this chapter may not |
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exceed the amount of the bond. |
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SECTION 2. (a) The consumer credit commissioner shall |
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select a database provider under Section 342.607, Finance Code, as |
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added by this Act, not later than January 1, 2010, and shall set the |
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date on which a person who offers, services, or brokers a deferred |
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presentment transaction must begin submitting data as provided by |
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that section. |
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(b) A person who offers, services, or brokers a deferred |
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presentment transaction is required to be certified and file a bond |
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under Sections 342.608 and 342.609, Finance Code, as added by this |
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Act, not later than January 1, 2010. The consumer credit |
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commissioner shall prescribe an application for certification |
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under Section 342.608, Finance Code, as added by this Act, not later |
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than November 1, 2009. |
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SECTION 3. This Act takes effect September 1, 2009. |