103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB3693

 

Introduced 2/17/2023, by Rep. Camille Y. Lilly

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Illinois Credit Union Act, the Transmitters of Money Act, the Sales Finance Agency Act, the Debt Management Service Act, the Consumer Installment Loan Act, the Debt Settlement Consumer Protection Act, and the Payday Loan Reform Act. Requires applicants for a license or renewal of a license to operate a credit union, operate as a transmitter of money, engage in the business of a sales finance agency, engage in a debt management service, make consumer installment loans, operate as a debt settlement provider, or operate as a lender of payday loans to provide an email address of record to the Department of Financial and Professional Regulation. In provisions concerning service of certain notices and orders, allows service by email to the email address of record. Provides that service to an email address of record is deemed complete when sent. Provides that service by certified mail shall be deemed completed when the notice is deposited in the United States mail. Defines the term "email address of record". Makes other changes.


LRB103 28809 BMS 55194 b

 

 

A BILL FOR

 

HB3693LRB103 28809 BMS 55194 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Credit Union Act is amended by
5changing Sections 1.1, 2, 8, 21, and 61 as follows:
 
6    (205 ILCS 305/1.1)  (from Ch. 17, par. 4402)
7    Sec. 1.1. Definitions.
8    Credit Union - The term "credit union" means a
9cooperative, non-profit association, incorporated under this
10Act, under the laws of the United States of America or under
11the laws of another state, for the purposes of encouraging
12thrift among its members, creating a source of credit at a
13reasonable rate of interest, and providing an opportunity for
14its members to use and control their own money in order to
15improve their economic and social conditions. The membership
16of a credit union shall consist of a group or groups each
17having a common bond as set forth in this Act.
18    Common Bond - The term "common bond" refers to groups of
19people who meet one of the following qualifications:
20        (1) Persons belonging to a specific association, group
21    or organization, such as a church, labor union, club or
22    society and members of their immediate families which
23    shall include any relative by blood or marriage or foster

 

 

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1    and adopted children.
2        (2) Persons who reside in a reasonably compact and
3    well defined neighborhood or community, and members of
4    their immediate families which shall include any relative
5    by blood or marriage or foster and adopted children.
6        (3) Persons who have a common employer or who are
7    members of an organized labor union or an organized
8    occupational or professional group within a defined
9    geographical area, and members of their immediate families
10    which shall include any relative by blood or marriage or
11    foster and adopted children.
12    Shares - The term "shares" or "share accounts" means any
13form of shares issued by a credit union and established by a
14member in accordance with standards specified by a credit
15union, including but not limited to common shares, share draft
16accounts, classes of shares, share certificates, special
17purpose share accounts, shares issued in trust, custodial
18accounts, and individual retirement accounts or other plans
19established pursuant to Section 401(d) or (f) or Section
20408(a) of the Internal Revenue Code, as now or hereafter
21amended, or similar provisions of any tax laws of the United
22States that may hereafter exist.
23    Credit Union Organization - The term "credit union
24organization" means any organization established to serve the
25needs of credit unions, the business of which relates to the
26daily operations of credit unions.

 

 

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1    Department - The term "Department" means the Illinois
2Department of Financial and Professional Regulation.
3    Email address of record – The term "email address of
4record" means an accurate and current email address designated
5by a credit union and recorded by the Division of Financial
6Institutions in the credit union's file maintained by the
7Division of Financial Institutions.
8    Secretary - The term "Secretary" means the Secretary of
9Financial and Professional Regulation or a person authorized
10by the Secretary or this Act to act in the Secretary's stead.
11    Division of Financial Institutions - The term "Division of
12Financial Institutions" means the Division of Financial
13Institutions of the Department of Financial and Professional
14Regulation.
15    Director - The term "Director of Financial Institutions"
16means the Director of the Division of Financial Institutions
17of the Department of Financial and Professional Regulation.
18    Office - The term "office" means the Division of Financial
19Institutions of the Department of Financial and Professional
20Regulation.
21    NCUA - The term "NCUA" means the National Credit Union
22Administration, an agency of the United States Government
23charged with the supervision of credit unions chartered under
24the laws of the United States of America.
25    Central Credit Union - The term "central credit union"
26means a credit union incorporated primarily to receive shares

 

 

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1from and make loans to credit unions and directors, officers,
2committee members and employees of credit unions. A central
3credit union may also accept as members persons who were
4members of credit unions which were liquidated and persons
5from occupational groups not otherwise served by another
6credit union.
7    Corporate Credit Union - The term "corporate credit union"
8means a credit union which is a cooperative, non-profit
9association, the membership of which is limited primarily to
10other credit unions.
11    Insolvent - "Insolvent" means the condition that results
12when the total of all liabilities and shares exceeds net
13assets of the credit union.
14    Danger of insolvency - For purposes of Section 61, a
15credit union is in "danger of insolvency" if its net worth to
16asset ratio falls below 2%. In calculating the danger of
17insolvency ratio, secondary capital shall be excluded. For
18purposes of Section 61, a credit union is also in "danger of
19insolvency" if the Department is unable to ascertain, upon
20examination, the true financial condition of the credit union.
21    Net Worth - "Net worth" means the retained earnings
22balance of the credit union, as determined under generally
23accepted accounting principles, and forms of secondary capital
24approved by the Secretary and the Director pursuant to
25rulemaking.
26    Charitable Donation Account - The term "charitable

 

 

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1donation account" means an account owned by a credit union
2that is held in a segregated custodial account or special
3purpose entity and specifically identified as a charitable
4donation account whereby, no less frequently than every 5
5years and upon termination of the account, at least 51% of the
6total return on assets in the account is distributed to one or
7more charitable organizations or non-profit entities.
8(Source: P.A. 97-133, eff. 1-1-12; 98-784, eff. 7-24-14.)
 
9    (205 ILCS 305/2)  (from Ch. 17, par. 4403)
10    Sec. 2. Organization procedure.
11    (1) Any 9 or more persons of legal age, the majority of
12whom shall be residents of the State of Illinois, who have a
13common bond referred to in Section 1.1 may organize a credit
14union or a central credit union by complying with this
15Section.
16    (2) The subscribers shall execute in duplicate Articles of
17Incorporation and agree to the terms thereof, which Articles
18shall state:
19        (a) The name, which shall include the words "credit
20    union" and which shall not be the same as that of any other
21    existing credit union in this state, and the location
22    where the proposed credit union is to have its principal
23    place of business;
24        (b) The common bond of the members of the credit
25    union;

 

 

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1        (c) The par value of the shares of the credit union,
2    which must be at least $1;
3        (d) The names, addresses and Social Security numbers
4    of the subscribers to the Articles of Incorporation, and
5    the number and the value of shares subscribed to by each;
6        (e) That the credit union may exercise such incidental
7    powers as are necessary or requisite to enable it to carry
8    on effectively the purposes for which it is incorporated,
9    and those powers which are inherent in the credit union as
10    a legal entity;
11        (f) That the existence of the credit union shall be
12    perpetual.
13    (3) The subscribers shall prepare and adopt bylaws for the
14general government of the credit union, consistent with this
15Act, and execute same in duplicate.
16    (4) The subscribers shall forward the articles of
17incorporation and the bylaws to the Secretary in duplicate,
18along with the required charter fee. If they conform to the
19law, and such rules and regulations as the Secretary and the
20Director may prescribe, if the Secretary determines that a
21common bond exists, and that it is economically advisable to
22organize the credit union, he or she shall within 60 days issue
23a certificate of approval attached to the articles of
24incorporation and return a copy of the bylaws and the articles
25of incorporation to the applicants or their representative,
26which shall be preserved in the permanent files of the credit

 

 

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1union. The subscribers shall file the certificate of approval,
2with the articles of incorporation attached, in the office of
3the recorder (or, if there is no recorder, in the office of the
4county clerk) of the county in which the credit union is to
5locate its principal place of business. The recorder or the
6county clerk, as the case may be, shall accept and record the
7documents if they are accompanied by the proper fee. When the
8documents are so recorded, the credit union is incorporated
9under this Act.
10    (5) The subscribers for a credit union charter shall not
11transact any business until the certificate of approval has
12been received.
13    (6) At the time of executing the articles of
14incorporation, the subscribers shall provide an email address
15of record.
16(Source: P.A. 100-361, eff. 8-25-17.)
 
17    (205 ILCS 305/8)  (from Ch. 17, par. 4409)
18    Sec. 8. Secretary's powers and duties. Credit unions are
19regulated by the Department. The Secretary in executing the
20powers and discharging the duties vested by law in the
21Department has the following powers and duties:
22        (1) To exercise the rights, powers, and duties set
23    forth in this Act or any related Act. The Director shall
24    oversee the functions of the Division and report to the
25    Secretary, with respect to the Director's exercise of any

 

 

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1    of the rights, powers, and duties vested by law in the
2    Secretary under this Act. All references in this Act to
3    the Secretary shall be deemed to include the Director, as
4    a person authorized by the Secretary or this Act to assume
5    responsibility for the oversight of the functions of the
6    Department relating to the regulatory supervision of
7    credit unions under this Act.
8        (2) To prescribe rules and regulations for the
9    administration of this Act. The provisions of the Illinois
10    Administrative Procedure Act are hereby expressly adopted
11    and incorporated herein as though a part of this Act, and
12    shall apply to all administrative rules and procedures of
13    the Department under this Act.
14        (3) To direct and supervise all the administrative and
15    technical activities of the Department including the
16    employment of a Credit Union Supervisor who shall have
17    knowledge in the theory and practice of, or experience in,
18    the operations or supervision of financial institutions,
19    preferably credit unions, and such other persons as are
20    necessary to carry out his functions. The Secretary shall
21    ensure that all examiners appointed or assigned to examine
22    the affairs of State-chartered credit unions possess the
23    necessary training and continuing education to effectively
24    execute their jobs.
25        (4) To issue cease and desist orders when in the
26    opinion of the Secretary, a credit union is engaged or has

 

 

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1    engaged, or the Secretary has reasonable cause to believe
2    the credit union is about to engage, in an unsafe or
3    unsound practice, or is violating or has violated or the
4    Secretary has reasonable cause to believe is about to
5    violate a law, rule, or regulation or any condition
6    imposed in writing by the Department.
7        (5) To suspend from office and to prohibit from
8    further participation in any manner in the conduct of the
9    affairs of any credit union any director, officer, or
10    committee member who has committed any violation of a law,
11    rule, or regulation or of a cease and desist order or who
12    has engaged or participated in any unsafe or unsound
13    practice in connection with the credit union or who has
14    committed or engaged in any act, omission, or practice
15    which constitutes a breach of his fiduciary duty as such
16    director, officer, or committee member, when the Secretary
17    has determined that such action or actions have resulted
18    or will result in substantial financial loss or other
19    damage that seriously prejudices the interests of the
20    members.
21        (6) To assess a civil penalty against a credit union
22    provided that:
23            (A) the Secretary reasonably determines, based on
24        objective facts and an accurate assessment of
25        applicable legal standards, that the credit union has:
26                (i) committed a violation of this Act, any

 

 

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1            rule adopted in accordance with this Act, or any
2            order of the Secretary issued pursuant to his or
3            her authority under this Act; or
4                (ii) engaged or participated in any unsafe or
5            unsound practice;
6            (B) before a civil penalty is assessed under this
7        item (6), the Secretary must make the further
8        reasonable determination, based on objective facts and
9        an accurate assessment of applicable legal standards,
10        that the credit union's action constituting a
11        violation under subparagraph (i) of paragraph (A) of
12        this item (6) or an unsafe and unsound practice under
13        subparagraph (ii) of paragraph (A) of this item (6):
14                (i) directly resulted in a substantial and
15            material financial loss or created a reasonable
16            probability that a substantial and material
17            financial loss will directly result; or
18                (ii) constituted willful misconduct or a
19            material breach of fiduciary duty of any director,
20            officer, or committee member of the credit union;
21            Material financial loss, as referenced in this
22        paragraph (B), shall be assessed in light of
23        surrounding circumstances and the relative size and
24        nature of the financial loss or probable financial
25        loss. Certain benchmarks shall be used in determining
26        whether financial loss is material, such as a

 

 

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1        percentage of total assets or total gross income for
2        the immediately preceding 12-month period. Absent
3        compelling and extraordinary circumstances, no civil
4        penalty shall be assessed, unless the financial loss
5        or probable financial loss is equal to or greater than
6        either 1% of the credit union's total assets for the
7        immediately preceding 12-month period, or 1% of the
8        credit union's total gross income for the immediately
9        preceding 12-month period, whichever is less;
10            (C) before a civil penalty is assessed under this
11        item (6), the credit union must be expressly advised
12        in writing of the:
13                (i) specific violation that could subject it
14            to a penalty under this item (6); and
15                (ii) specific remedial action to be taken
16            within a specific and reasonable time frame to
17            avoid imposition of the penalty;
18            (D) civil Civil penalties assessed under this item
19        (6) shall be remedial, not punitive, and reasonably
20        tailored to ensure future compliance by the credit
21        union with the provisions of this Act and any rules
22        adopted pursuant to this Act;
23            (E) a credit union's failure to take timely
24        remedial action with respect to the specific violation
25        may result in the issuance of an order assessing a
26        civil penalty up to the following maximum amount,

 

 

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1        based upon the total assets of the credit union:
2                (i) Credit unions with assets of less than $10
3            million................................................$1,000
4                (ii) Credit unions with assets of at least $10
5            million and less than $50 million......................$2,500
6                (iii) Credit unions with assets of at least
7            $50 million and less than $100 million.................$5,000
8                (iv) Credit unions with assets of at least
9            $100 million and less than $500 million...............$10,000
10                (v) Credit unions with assets of at least $500
11            million and less than $1 billion......................$25,000
12                (vi) Credit unions with assets of $1 billion
13            and greater.....................................$50,000; and
14            (F) an order assessing a civil penalty under this
15        item (6) shall be served by certified mail or email to
16        the email address of record and take effect upon
17        service of the order, unless the credit union makes a
18        written request for a hearing under 38 Ill. IL. Adm.
19        Code 190.20 of the Department's rules for credit
20        unions within 90 days after issuance of the order; in
21        that event, the order shall be stayed until a final
22        administrative order is entered. Service by certified
23        mail shall be deemed completed when the notice is
24        deposited in the United States mail. Service to the
25        email address of record shall be deemed completed when
26        sent.

 

 

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1        This item (6) shall not apply to violations separately
2    addressed in rules as authorized under item (7) of this
3    Section.
4        (7) Except for the fees established in this Act, to
5    prescribe, by rule and regulation, fees and penalties for
6    preparing, approving, and filing reports and other
7    documents; furnishing transcripts; holding hearings;
8    investigating applications for permission to organize,
9    merge, or convert; failure to maintain accurate books and
10    records to enable the Department to conduct an
11    examination; and taking supervisory actions.
12        (8) To destroy, in his discretion, any or all books
13    and records of any credit union in his possession or under
14    his control after the expiration of three years from the
15    date of cancellation of the charter of such credit unions.
16        (9) To make investigations and to conduct research and
17    studies and to publish some of the problems of persons in
18    obtaining credit at reasonable rates of interest and of
19    the methods and benefits of cooperative saving and lending
20    for such persons.
21        (10) To authorize, foster, or establish experimental,
22    developmental, demonstration, or pilot projects by public
23    or private organizations including credit unions which:
24            (a) promote more effective operation of credit
25        unions so as to provide members an opportunity to use
26        and control their own money to improve their economic

 

 

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1        and social conditions; or
2            (b) are in the best interests of credit unions,
3        their members and the people of the State of Illinois.
4        (11) To cooperate in studies, training, or other
5    administrative activities with, but not limited to, the
6    NCUA, other state credit union regulatory agencies and
7    industry trade associations in order to promote more
8    effective and efficient supervision of Illinois chartered
9    credit unions.
10        (12) Notwithstanding the provisions of this Section,
11    the Secretary shall not:
12            (1) issue an order against a credit union
13        organized under this Act for unsafe or unsound banking
14        practices solely because the entity provides or has
15        provided financial services to a cannabis-related
16        legitimate business;
17            (2) prohibit, penalize, or otherwise discourage a
18        credit union from providing financial services to a
19        cannabis-related legitimate business solely because
20        the entity provides or has provided financial services
21        to a cannabis-related legitimate business;
22            (3) recommend, incentivize, or encourage a credit
23        union not to offer financial services to an account
24        holder or to downgrade or cancel the financial
25        services offered to an account holder solely because:
26                (A) the account holder is a manufacturer or

 

 

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1            producer, or is the owner, operator, or employee
2            of a cannabis-related legitimate business;
3                (B) the account holder later becomes an owner
4            or operator of a cannabis-related legitimate
5            business; or
6                (C) the credit union was not aware that the
7            account holder is the owner or operator of a
8            cannabis-related legitimate business; and
9            (4) take any adverse or corrective supervisory
10        action on a loan made to an owner or operator of:
11                (A) a cannabis-related legitimate business
12            solely because the owner or operator owns or
13            operates a cannabis-related legitimate business;
14            or
15                (B) real estate or equipment that is leased to
16            a cannabis-related legitimate business solely
17            because the owner or operator of the real estate
18            or equipment leased the equipment or real estate
19            to a cannabis-related legitimate business.
20(Source: P.A. 101-27, eff. 6-25-19; 102-858, eff. 5-13-22;
21revised 8-19-22.)
 
22    (205 ILCS 305/21)  (from Ch. 17, par. 4422)
23    Sec. 21. Record of board and committee members. Within 30
24days after election or appointment, the names and addresses of
25the members of the board of directors, committees and all

 

 

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1officers of the credit union shall be filed with the
2Department on forms provided by the Department. The form shall
3also include the email address of record of the credit union.
4(Source: P.A. 97-133, eff. 1-1-12.)
 
5    (205 ILCS 305/61)  (from Ch. 17, par. 4462)
6    Sec. 61. Suspension.
7    (1) If the Secretary determines that any credit union is
8bankrupt, insolvent, impaired or that it has violated this
9Act, or is operating in an unsafe or unsound manner, he shall
10issue an order temporarily suspending the credit union's
11operations for not more than 60 days. The board of directors
12shall be given notice by registered or certified mail, or by
13email to the email address of record, of such suspension,
14which notice shall include the reasons for such suspension and
15a list of specific violations of the Act. Service by certified
16mail shall be deemed completed when the notice is deposited in
17the United States mail. Service to the email address of record
18shall be deemed completed when sent. The Secretary shall also
19notify the members of the credit union board of advisors of any
20suspension. The Director may assess to the credit union a
21penalty, not to exceed the regulatory fee as set forth in this
22Act, to offset costs incurred in determining the condition of
23the credit union's books and records.
24    (2) Upon receipt of such suspension notice, the credit
25union shall cease all operations, except those authorized by

 

 

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1the Secretary, or the Secretary may appoint a manager-trustee
2to operate the credit union during the suspension period. The
3board of directors shall, within 10 days of the receipt of the
4suspension notice, file with the Secretary a reply to the
5suspension notice by submitting a corrective plan of action or
6a request for formal hearing on said action pursuant to the
7Department's rules and regulations.
8    (3) Upon receipt from the suspended credit union of
9evidence that the conditions causing the order of suspension
10have been corrected, and after determining that the proposed
11corrective plan of action submitted is factual, the Secretary
12shall revoke the suspension notice, permit the credit union to
13resume normal operations, and notify the board of credit union
14advisors of such action.
15    (4) If the Secretary determines that the proposed
16corrective plan of action will not correct such conditions, he
17may take possession and control of the credit union. The
18Secretary may permit the credit union to operate under his
19direction and control and may appoint a manager-trustee to
20manage its affairs until such time as the condition requiring
21such action has been remedied, or in the case of insolvency or
22danger of insolvency where an emergency requiring expeditious
23action exists, the Secretary may involuntarily merge the
24credit union without the vote of the suspended credit union's
25board of directors or members (hereafter involuntary merger)
26subject to rules promulgated by the Secretary. No credit union

 

 

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1shall be required to serve as a surviving credit union in any
2involuntary merger. Upon the request of the Secretary, a
3credit union by a vote of a majority of its board of directors
4may elect to serve as a surviving credit union in an
5involuntary merger. If the Secretary determines that the
6suspended credit union should be liquidated, he may appoint a
7liquidating agent and require of that person such bond and
8security as he considers proper.
9    (5) Upon receipt of a request for a formal hearing, the
10Secretary shall conduct proceedings pursuant to rules and
11regulations of the Department. The credit union may request
12the appropriate court to stay execution of such action.
13Involuntary liquidation or involuntary merger may not be
14ordered prior to the conclusion of suspension procedures
15outlined in this Section.
16    (6) If, within the suspension period, the credit union
17fails to answer the suspension notice or fails to request a
18formal hearing, or both, the Secretary may then (i)
19involuntarily merge the credit union if the credit union is
20insolvent or in danger of insolvency and an emergency
21requiring expeditious action exists or (ii) revoke the credit
22union's charter, appoint a liquidating agent and liquidate the
23credit union.
24(Source: P.A. 97-133, eff. 1-1-12.)
 
25    Section 10. The Transmitters of Money Act is amended by

 

 

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1changing Sections 5, 25, 40, 80, 90, and 100 as follows:
 
2    (205 ILCS 657/5)
3    Sec. 5. Definitions. As used in this Act, unless the
4context otherwise requires, the words and phrases defined in
5this Section have the meanings set forth in this Section.
6    "Authorized seller" means a person not an employee of a
7licensee who engages in the business regulated by this Act on
8behalf of a licensee under a contract between that person and
9the licensee.
10    "Bill payment service" means the business of transmitting
11money on behalf of an Illinois resident for the purpose of
12paying the resident's bills.
13    "Controlling person" means a person owning or holding the
14power to vote 25% or more of the outstanding voting securities
15of a licensee or the power to vote the securities of another
16controlling person of the licensee. For purposes of
17determining the percentage of a licensee controlled by a
18controlling person, the person's interest shall be combined
19with the interest of any other person controlled, directly or
20indirectly, by that person or by a spouse, parent, or child of
21that person.
22    "Department" means the Department of Financial and
23Professional Regulation Institutions.
24    "Director" means the Director of Financial Institutions.
25    "Division of Financial Institutions" means the Division of

 

 

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1Financial Institutions of the Department of Financial and
2Professional Regulation.
3    "Email address of record" means the designated email
4address recorded by the Division of Financial Institutions in
5the applicant's applicant file or the licensee's license file,
6as maintained by the Division of Financial Institutions'
7licensure unit.
8    "Licensee" means a person licensed under this Act.
9    "Location" means a place of business at which activity
10regulated by this Act occurs.
11    "Material litigation" means any litigation that, according
12to generally accepted accounting principles, is deemed
13significant to a licensee's financial health and would be
14required to be referenced in a licensee's annual audited
15financial statements, reports to shareholders, or similar
16documents.
17    "Money" means a medium of exchange that is authorized or
18adopted by a domestic or foreign government as a part of its
19currency and that is customarily used and accepted as a medium
20of exchange in the country of issuance.
21    "Money transmitter" means a person who is located in or
22doing business in this State and who directly or through
23authorized sellers does any of the following in this State:
24        (1) Sells or issues payment instruments.
25        (2) Engages in the business of receiving money for
26    transmission or transmitting money.

 

 

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1        (3) Engages in the business of exchanging, for
2    compensation, money of the United States Government or a
3    foreign government to or from money of another government.
4    "Outstanding payment instrument" means, unless otherwise
5treated by or accounted for under generally accepted
6accounting principles on the books of the licensee, a payment
7instrument issued by the licensee that has been sold in the
8United States directly by the licensee or has been sold in the
9United States by an authorized seller of the licensee and
10reported to the licensee as having been sold, but has not been
11paid by or for the licensee.
12    "Payment instrument" means a check, draft, money order,
13traveler's check, stored value card, or other instrument or
14memorandum, written order or written receipt for the
15transmission or payment of money sold or issued to one or more
16persons whether or not that instrument or order is negotiable.
17Payment instrument does not include an instrument that is
18redeemable by the issuer in merchandise or service, a credit
19card voucher, or a letter of credit. A written order for the
20transmission or payment of money that results in the issuance
21of a check, draft, money order, traveler's check, or other
22instrument or memorandum is not a payment instrument.
23    "Person" means an individual, partnership, association,
24joint stock association, corporation, or any other form of
25business organization.
26    "Stored value card" means any magnetic stripe card or

 

 

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1other electronic payment instrument given in exchange for
2money and other similar consideration, including but not
3limited to checks, debit payments, money orders, drafts,
4credit payments, and traveler's checks, where the card or
5other electronic payment instrument represents a dollar value
6that the consumer can either use or give to another
7individual.
8    "Transmitting money" means the transmission of money by
9any means, including transmissions to or from locations within
10the United States or to and from locations outside of the
11United States by payment instrument, facsimile or electronic
12transfer, or otherwise, and includes bill payment services.
13(Source: P.A. 92-400, eff. 1-1-02; 93-535, eff. 1-1-04.)
 
14    (205 ILCS 657/25)
15    Sec. 25. Application for license.
16    (a) An application for a license must be in writing, under
17oath, and in the form the Director prescribes. At the time of
18application, each applicant shall provide an email address of
19record. The application must contain or be accompanied by all
20of the following:
21        (1) The name of the applicant and the address of the
22    principal place of business of the applicant and the
23    address of all locations and proposed locations of the
24    applicant in this State.
25        (2) The form of business organization of the

 

 

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1    applicant, including:
2            (A) a copy of its articles of incorporation and
3        amendments thereto and a copy of its bylaws, certified
4        by its secretary, if the applicant is a corporation;
5            (B) a copy of its partnership agreement, certified
6        by a partner, if the applicant is a partnership; or
7            (C) a copy of the documents that control its
8        organizational structure, certified by a managing
9        official, if the applicant is organized in some other
10        form.
11        (3) The name, business and home address, and a
12    chronological summary of the business experience, material
13    litigation history, and felony convictions over the
14    preceding 10 years of:
15            (A) the proprietor, if the applicant is an
16        individual;
17            (B) every partner, if the applicant is a
18        partnership;
19            (C) each officer, director, and controlling
20        person, if the applicant is a corporation; and
21            (D) each person in a position to exercise control
22        over, or direction of, the business of the applicant,
23        regardless of the form of organization of the
24        applicant.
25        (4) Financial statements, not more than one year old,
26    prepared in accordance with generally accepted accounting

 

 

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1    principles and audited by a licensed public accountant or
2    certified public accountant showing the financial
3    condition of the applicant and an unaudited balance sheet
4    and statement of operation as of the most recent quarterly
5    report before the date of the application, certified by
6    the applicant or an officer or partner thereof. If the
7    applicant is a wholly owned subsidiary or is eligible to
8    file consolidated federal income tax returns with its
9    parent, however, unaudited financial statements for the
10    preceding year along with the unaudited financial
11    statements for the most recent quarter may be submitted if
12    accompanied by the audited financial statements of the
13    parent company for the preceding year along with the
14    unaudited financial statement for the most recent quarter.
15        (5) Filings of the applicant with the Securities and
16    Exchange Commission or similar foreign governmental entity
17    (English translation), if any.
18        (6) A list of all other states in which the applicant
19    is licensed as a money transmitter and whether the license
20    of the applicant for those purposes has ever been
21    withdrawn, refused, canceled, or suspended in any other
22    state, with full details.
23        (7) A list of all money transmitter locations and
24    proposed locations in this State.
25        (8) A sample of the contract for authorized sellers.
26        (9) A sample form of the proposed payment instruments

 

 

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1    to be used in this State.
2        (10) The name and business address of the clearing
3    banks through which the applicant intends to conduct any
4    business regulated under this Act.
5        (11) A surety bond as required by Section 30 of this
6    Act.
7        (12) The applicable fees as required by Section 45 of
8    this Act.
9        (13) A written consent to service of process as
10    provided by Section 100 of this Act.
11        (14) A written statement that the applicant is in full
12    compliance with and agrees to continue to fully comply
13    with all state and federal statutes and regulations
14    relating to money laundering.
15        (15) All additional information the Director considers
16    necessary in order to determine whether or not to issue
17    the applicant a license under this Act.
18    (a-5) The proprietor, partner, officer, director, and
19controlling person of the applicant shall submit their
20fingerprints to the Illinois State Police in an electronic
21format that complies with the form and manner for requesting
22and furnishing criminal history record information as
23prescribed by the Illinois State Police. These fingerprints
24shall be retained and checked against the Illinois State
25Police and Federal Bureau of Investigation criminal history
26record databases now and hereafter filed, including latent

 

 

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1fingerprint searches. The Illinois State Police shall charge
2applicants a fee for conducting the criminal history records
3check, which shall be deposited into the State Police Services
4Fund and shall not exceed the actual cost of the records check.
5The Illinois State Police shall furnish records of Illinois
6convictions to the Department pursuant to positive
7identification and shall forward the national criminal history
8record information to the Department. The Department may
9require applicants to pay a separate fingerprinting fee,
10either to the Department or to a Department-designated or
11Department-approved vendor. The Department, in its discretion,
12may allow a proprietor, partner, officer, director, or
13controlling person of an applicant who does not have
14reasonable access to a designated vendor to provide his or her
15fingerprints in an alternative manner. The Department, in its
16discretion, may also use other procedures in performing or
17obtaining criminal background checks of applicants. Instead of
18submitting his or her fingerprints, an individual may submit
19proof that is satisfactory to the Department that an
20equivalent security clearance has been conducted. The
21Department may adopt any rules necessary to implement this
22subsection.
23    (b) The Director may, for good cause shown, waive, in
24part, any of the requirements of this Section.
25(Source: P.A. 102-538, eff. 8-20-21.)
 

 

 

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1    (205 ILCS 657/40)
2    Sec. 40. Renewals of license. As a condition for renewal
3of a license, a licensee must submit to the Director, and the
4Director must receive, on or before December 1 of each year, an
5application for renewal made in writing and under oath on a
6form prescribed by the Director. At the time of renewal, each
7licensee shall provide an email address of record. A licensee
8whose application for renewal is not received by the
9Department on or before December 31 shall not have its license
10renewed and shall be required to submit to the Director an
11application for a new license in accordance with Section 25.
12Upon a showing of good cause, the Director may extend the
13deadline for the filing of an application for renewal. The
14application for renewal of a license shall contain or be
15accompanied by all of the following:
16        (1) The name of the licensee and the address of the
17    principal place of business of the licensee.
18        (2) A list of all locations where the licensee is
19    conducting business under its license and a list of all
20    authorized sellers through whom the licensee is conducting
21    business under its license, including the name and
22    business address of each authorized seller.
23        (3) Audited financial statements covering the past
24    year of operations, prepared in accordance with generally
25    accepted accounting principles, showing the financial
26    condition of the licensee. The licensee shall submit the

 

 

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1    audited financial statement after the application for
2    renewal has been approved. The audited financial statement
3    must be received by the Department no later than 120 days
4    after the end of the licensee's fiscal year. If the
5    licensee is a wholly owned subsidiary or is eligible to
6    file consolidated federal income tax returns with its
7    parent, the licensee may submit unaudited financial
8    statements if accompanied by the audited financial
9    statements of the parent company for its most recently
10    ended year.
11        (4) A statement of the dollar amount and number of
12    money transmissions and payment instruments sold, issued,
13    exchanged, or transmitted in this State by the licensee
14    and its authorized sellers for the past year.
15        (5) A statement of the dollar amount of uncompleted
16    money transmissions and payment instruments outstanding or
17    in transit, in this State, as of the most recent quarter
18    available.
19        (6) The annual license renewal fees and any penalty
20    fees as provided by Section 45 of this Act.
21        (7) Evidence sufficient to prove to the satisfaction
22    of the Director that the licensee has complied with all
23    requirements under Section 20 relating to its net worth,
24    under Section 30 relating to its surety bond or other
25    security, and under Section 50 relating to permissible
26    investments.

 

 

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1        (8) A statement of a change in information provided by
2    the licensee in its application for a license or its
3    previous applications for renewal including, but not
4    limited to, new directors, officers, authorized sellers,
5    or clearing banks and material changes in the operation of
6    the licensee's business.
7(Source: P.A. 92-400, eff. 1-1-02.)
 
8    (205 ILCS 657/80)
9    Sec. 80. Revocation or suspension of licenses.
10    (a) The Director may suspend or revoke a license if the
11Director finds any of the following:
12        (1) The licensee has knowingly made a material
13    misstatement or suppressed or withheld information on an
14    application for a license or a document required to be
15    filed with the Director.
16        (2) A fact or condition exists that, if it had existed
17    or had been known at the time the licensee applied for its
18    license, would have been grounds for denying the
19    application.
20        (3) The licensee is insolvent.
21        (4) The licensee has knowingly violated a material
22    provision of this Act or rules adopted under this Act or an
23    order of the Director.
24        (5) The licensee refuses to permit the Director to
25    make an examination at reasonable times as authorized by

 

 

HB3693- 30 -LRB103 28809 BMS 55194 b

1    this Act.
2        (6) The licensee knowingly fails to make a report
3    required by this Act.
4        (7) The licensee fails to pay a judgment entered in
5    favor of a claimant, plaintiff, or creditor in an action
6    arising out of the licensee's business regulated under
7    this Act within 30 days after the judgment becomes final
8    or within 30 days after expiration or termination of a
9    stay of execution.
10        (8) The licensee has been convicted under the laws of
11    this State, another state, or the United States of a
12    felony or of a crime involving a breach of trust or
13    dishonesty.
14        (9) The licensee has failed to suspend or terminate
15    its authorized seller's authority to act on its behalf
16    when the licensee knew its authorized seller was violating
17    or had violated a material provision of this Act or rules
18    adopted under this Act or an order of the Director.
19    (b) In every case in which a license is suspended or
20revoked or an application for a license or renewal of a license
21is denied, the Director shall serve notice of his action,
22including a statement of the reasons for his action, either
23personally, to the email address of record, or by certified
24mail, return receipt requested. Service by certified mail
25shall be deemed completed if the notice is deposited in the
26United States mail post office, postage paid, addressed to the

 

 

HB3693- 31 -LRB103 28809 BMS 55194 b

1last known address specified in the application for a license.
2Service to the email address of record shall be deemed
3completed when sent.
4    (c) In the case of denial of an application for a license
5or renewal of a license, the applicant or licensee may request
6in writing, within 30 days after the date of service, a
7hearing. In the case of a denial of an application for renewal
8of a license, the expiring license shall be deemed to continue
9in force until 30 days after the service of the notice of
10denial or, if a hearing is requested during that period, until
11a final order is entered pursuant to a hearing.
12    (d) The order of suspension or revocation of a license
13shall take effect upon service of the order. The holder of any
14suspended or revoked license may request in writing, within 30
15days after the date of service, a hearing. In the event a
16hearing is requested, the order shall remain temporary until a
17final order is entered pursuant to the hearing.
18    (e) The hearing shall be held at the time and place
19designated by the Director in either the City of Springfield
20or the City of Chicago. The Director and any administrative
21law judge designated by him shall have the power to administer
22oaths and affirmations, subpoena witnesses and compel their
23attendance, take evidence, authorize the taking of
24depositions, and require the production of books, papers,
25correspondence, and other records or information that he
26considers relevant or material to the inquiry.

 

 

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1    (f) The Director may issue an order of suspension or
2revocation of a license that takes effect upon service of the
3order and remains in effect regardless of a request for a
4hearing when the Director finds that the public welfare will
5be endangered if the licensee is permitted to continue to
6operate the business regulated by this Act.
7    (g) The decision of the Director to deny any application
8for a license or renewal of a license or to suspend or revoke a
9license is subject to judicial review under the Administrative
10Review Law.
11    (h) The costs for administrative hearing shall be set by
12rule.
13    (i) Appeals from all final orders and judgments entered by
14the circuit court under this Section in review of a decision of
15the Director may be taken as in other civil actions by any
16party to the proceeding.
17(Source: P.A. 88-643, eff. 1-1-95.)
 
18    (205 ILCS 657/90)
19    Sec. 90. Enforcement.
20    (a) If it appears to the Director that a person has
21committed or is about to commit a violation of this Act, a rule
22promulgated under this Act, or an order of the Director, the
23Director may apply to the circuit court for an order enjoining
24the person from violating or continuing to violate this Act,
25the rule, or order and for injunctive or other relief that the

 

 

HB3693- 33 -LRB103 28809 BMS 55194 b

1nature of the case may require and may, in addition, request
2the court to assess a civil penalty up to $1,000 along with
3costs and attorney fees.
4    (b) If the Director finds, after an investigation that he
5considers appropriate, that a licensee or other person is
6engaged in practices contrary to this Act or to the rules
7promulgated under this Act, the Director may issue an order
8directing the licensee or person to cease and desist the
9violation. The Director may, in addition to or without the
10issuance of a cease and desist order, assess an administrative
11penalty up to $1,000 against a licensee for each violation of
12this Act or the rules promulgated under this Act. The issuance
13of an order under this Section shall not be a prerequisite to
14the taking of any action by the Director under this or any
15other Section of this Act. The Director shall serve notice of
16his action, including a statement of the reasons for his
17actions, either personally, to the email address of record, or
18by certified mail, return receipt requested. Service by
19certified mail shall be deemed completed if the notice is
20deposited in the United States mail post office, postage paid,
21addressed to the last known address for a license. Service to
22the email address of record shall be deemed completed when
23sent.
24    (c) In the case of the issuance of a cease and desist order
25or assessment order, a hearing may be requested in writing
26within 30 days after the date of service. The hearing shall be

 

 

HB3693- 34 -LRB103 28809 BMS 55194 b

1held at the time and place designated by the Director in either
2the City of Springfield or the City of Chicago. The Director
3and any administrative law judge designated by him shall have
4the power to administer oaths and affirmations, subpoena
5witnesses and compel their attendance, take evidence,
6authorize the taking of depositions, and require the
7production of books, papers, correspondence, and other records
8or information that he considers relevant or material to the
9inquiry.
10    (d) After the Director's final determination under a
11hearing under this Section, a party to the proceedings whose
12interests are affected by the Director's final determination
13shall be entitled to judicial review of that final
14determination under the Administrative Review Law.
15    (e) The costs for administrative hearings shall be set by
16rule.
17    (f) Except as otherwise provided in this Act, a violation
18of this Act shall subject the party violating it to a fine of
19$1,000 for each offense.
20    (g) Each transaction in violation of this Act or the rules
21promulgated under this Act and each day that a violation
22continues shall be a separate offense.
23    (h) A person who engages in conduct requiring a license
24under this Act and fails to obtain a license from the Director
25or knowingly makes a false statement, misrepresentation, or
26false certification in an application, financial statement,

 

 

HB3693- 35 -LRB103 28809 BMS 55194 b

1account record, report, or other document filed or required to
2be maintained or filed under this Act or who knowingly makes a
3false entry or omits a material entry in a document is guilty
4of a Class 3 felony.
5    (i) The Director is authorized to compromise, settle, and
6collect civil penalties and administrative penalties, as set
7by rule, with any person for violations of this Act or of any
8rule or order issued or promulgated under this Act. Any person
9who, without the required license, engages in conduct
10requiring a license under this Act shall be liable to the
11Department in an amount equal to the greater of (i) $5,000 or
12(ii) an amount of money accepted for transmission plus an
13amount equal to 3 times the amount accepted for transmission.
14The Department shall cause any funds so recovered to be
15deposited in the TOMA Consumer Protection Fund.
16    (j) The Director may enter into consent orders at any time
17with a person to resolve a matter arising under this Act. A
18consent order must be signed by the person to whom it is issued
19and must indicate agreement to the terms contained in it. A
20consent order need not constitute an admission by a person
21that this Act or a rule or order issued or promulgated under
22this Act has been violated, nor need it constitute a finding by
23the Director that the person has violated this Act or a rule or
24order promulgated under this Act.
25    (k) Notwithstanding the issuance of a consent order, the
26Director may seek civil or criminal penalties or compromise

 

 

HB3693- 36 -LRB103 28809 BMS 55194 b

1civil penalties concerning matter encompassed by the consent
2order unless the consent order by its terms expressly
3precludes the Director from doing so.
4    (l) Appeals from all final orders and judgments entered by
5the circuit court under this Section in review of a decision of
6the Director may be taken as in other civil actions by any
7party to the proceeding.
8(Source: P.A. 100-201, eff. 8-18-17.)
 
9    (205 ILCS 657/100)
10    Sec. 100. Consent to service of process.
11    (a) A licensee, before doing business in this State, shall
12appoint the Director its true and lawful attorney-in-fact upon
13whom all lawful process in any action or legal proceeding
14against it may be served and shall agree that any lawful
15process against it that may be served upon its attorney shall
16be of the same force and validity as if served on itself. The
17consent to the service of process shall be in the form
18prescribed by the Director, shall be irrevocable, and shall
19provide that actions or proceedings arising out of or founded
20upon the conduct of the licensee's business may be commenced
21against the licensee in any court of competent jurisdiction
22and proper venue within this State by the service of process or
23other notice of the institution of proceedings on the
24Director.
25    (b) Service of process or other notice, accompanied by the

 

 

HB3693- 37 -LRB103 28809 BMS 55194 b

1fee provided in Section 45, shall be by duplicate copies, one
2of which shall be filed with the Director and the other
3forwarded by the Director within 5 business days by certified
4mail with a return receipt to the licensee against whom the
5process or other notice is directed at its latest address on
6file with the Department or to the email address of record.
7Service by certified mail shall be deemed completed when the
8notice is deposited in the United States mail. Service to the
9email address of record shall be deemed completed when sent.
10    (c) No judgment shall be entered against a licensee
11pursuant to service upon the Director until at least 30 days
12have elapsed after process or notice has been served on the
13Director.
14(Source: P.A. 88-643, eff. 1-1-95.)
 
15    Section 15. The Sales Finance Agency Act is amended by
16changing Sections 2, 6, 10, and 16.5 as follows:
 
17    (205 ILCS 660/2)  (from Ch. 17, par. 5202)
18    Sec. 2. Definitions. In this Act, unless the context
19otherwise requires:
20    "Sales finance agency" means a person, irrespective of his
21or her state of domicile or place of business, engaged in this
22State, in whole or in part, in the business of purchasing, or
23making loans secured by, retail installment contracts, retail
24charge agreements or the outstanding balances under such

 

 

HB3693- 38 -LRB103 28809 BMS 55194 b

1contracts or agreements entered into in this State.
2    "Holder" of a retail installment contract or a retail
3charge agreement means the retail seller of the goods or
4services under the contract or charge agreement, or if the
5outstanding balances thereunder are purchased by or
6transferred as security to a sales finance agency or other
7assignee, the sales finance agency or other assignee.
8    "Person" means an individual, corporation, partnership,
9limited liability company, joint venture, or any other form of
10business association.
11    "Department" means the Department of Financial and
12Professional Regulation Institutions.
13    "Director" means the Director of Financial Institutions.
14    "Division of Financial Institutions" means the Division of
15Financial Institutions of the Department of Financial and
16Professional Regulation.
17    "Email address of record" means the designated email
18address recorded by the Division of Financial Institutions in
19the applicant's applicant file or the licensee's license file,
20as maintained by the Division of Financial Institutions'
21licensure unit.
22    "Motor Vehicle Retail Installment Sales Act" and "Retail
23Installment Sales Act" refer to the Acts having those titles
24enacted by the 75th General Assembly.
25    "Retail installment contract" and "retail charge
26agreement" have the meanings ascribed to them in the Motor

 

 

HB3693- 39 -LRB103 28809 BMS 55194 b

1Vehicle Retail Installment Sales Act and the Retail
2Installment Sales Act.
3    "Special purpose vehicle" means an entity that, in
4connection with a securitization, private placement, or
5similar type of investment transaction, is administered by a
6State or national bank under a management agreement for the
7purpose of purchasing, making loans against, or in pools of,
8receivables, general intangibles, and other financial assets
9including retail installment contracts, retail charge
10agreements, or the outstanding balances or any portion of the
11outstanding balances under those contracts or agreements.
12    "Net Worth" means total assets minus total liabilities.
13(Source: P.A. 89-400, eff. 8-20-95; 90-437, eff. 1-1-98.)
 
14    (205 ILCS 660/6)  (from Ch. 17, par. 5206)
15    Sec. 6. A license fee of $300 for the applicant's
16principal place of business and $100 for each additional place
17of business for which a license is sought must be submitted
18with an application for license made before July 1 of any year.
19If application for a license is made on July 1 or thereafter, a
20license fee of $150 for the principal place of business and of
21$50 for each additional place of business must accompany the
22application. Each license remains in force until surrendered,
23suspended, or revoked. If the application for license is
24denied, the original license fee shall be retained by the
25State in reimbursement of its costs of investigating that

 

 

HB3693- 40 -LRB103 28809 BMS 55194 b

1application.
2    Before the license is granted, the applicant shall prove
3in form satisfactory to the Director, that the applicant has a
4positive net worth of a minimum of $30,000. At the time of
5application, each applicant shall provide an email address of
6record.
7    A licensee must pay to the Department, and the Department
8must receive, by December 1 of each year, the renewal license
9application on forms prescribed by the Director and $300 for
10the license for his principal place of business and $100 for
11each additional license held as a renewal license fee for the
12succeeding calendar year.
13(Source: P.A. 92-398, eff. 1-1-02.)
 
14    (205 ILCS 660/10)  (from Ch. 17, par. 5223)
15    Sec. 10. Denial, revocation, fine, or suspension of
16license.
17    (a) The Director may revoke or suspend a license or fine a
18licensee if the licensee violates any provisions of this Act.
19    (b) In every case in which a license is revoked or
20suspended, a licensee is fined, or an application for a
21license or renewal of a license is denied, the Director shall
22serve notice of his or her action, including a statement of the
23reasons for the action either personally, to the email address
24of record, or by certified mail, return receipt requested.
25Service by certified mail shall be deemed completed when the

 

 

HB3693- 41 -LRB103 28809 BMS 55194 b

1notice is deposited in the United States U.S. mail. Service to
2the email address of record shall be deemed completed when
3sent.
4    (c) An order revoking or suspending a license or an order
5denying renewal of a license shall take effect upon service of
6the order, unless the licensee requests, in writing, within 10
7days after the date of service, a hearing. In the event a
8hearing is requested, the order shall be stayed until a final
9administrative order is entered.
10    (d) If the licensee requests a hearing, the Director shall
11schedule a hearing within 30 days after the request for a
12hearing unless otherwise agreed to by the parties.
13    (e) The hearing shall be held at the time and place
14designated by the Director. The Director and any
15administrative law judge designated by him or her shall have
16the power to administer oaths and affirmations, subpoena
17witnesses and compel their attendance, take evidence, and
18require the production of books, papers, correspondence, and
19other records or information that he or she considers relevant
20or material to the inquiry.
21    (f) The costs for the administrative hearing shall be set
22by rule.
23    (g) The Director shall have the authority to prescribe
24rules for the administration of this Section.
25(Source: P.A. 92-398, eff. 1-1-02.)
 

 

 

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1    (205 ILCS 660/16.5)
2    Sec. 16.5. Cease and desist orders.
3    (a) The Director may issue a cease and desist order to a
4sales finance agency or other person doing business without
5the required license when, in the opinion of the director, the
6licensee or other person is violating or is about to violate
7any provision of this Act or any law, rule, or requirement
8imposed in writing by the Department.
9    (b) The Director may issue a cease and desist order prior
10to a hearing.
11    (c) The Director shall serve notice of his or her action,
12designated as a cease and desist order made pursuant to this
13Section, including a statement of the reasons for the action,
14either personally, to the email address of record, or by
15certified mail, return receipt requested. Service by certified
16mail shall be deemed completed when the notice is deposited in
17the United States U.S. mail. Service to the email address of
18record shall be deemed completed when sent.
19    (d) Within 15 days of service of the cease and desist
20order, the sales finance agency or other person may request,
21in writing, a hearing.
22    (e) The Director shall schedule a hearing within 30 days
23after the request for a hearing unless otherwise agreed to by
24the parties.
25    (f) The Director shall have the authority to prescribe
26rules for the administration of this Section.

 

 

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1    (g) If it is determined that the Director had the
2authority to issue the cease and desist order, he or she may
3issue such orders as may be reasonably necessary to correct,
4eliminate, or remedy such conduct.
5    (h) The powers vested in the Director by this Section are
6additional to any and all other powers and remedies vested in
7the Director by law, and nothing in this Section shall be
8construed as requiring that the Director shall employ the
9powers conferred in this Section instead of or as a condition
10precedent to the exercise of any other power or remedy vested
11in the Director.
12    (i) The cost for the administrative hearing shall be set
13by rule.
14(Source: P.A. 90-437, eff. 1-1-98.)
 
15    Section 20. The Debt Management Service Act is amended by
16changing Sections 2, 4, 10, and 20 as follows:
 
17    (205 ILCS 665/2)  (from Ch. 17, par. 5302)
18    Sec. 2. Definitions. As used in this Act:
19    "Credit counselor" means an individual, corporation, or
20other entity that is not a debt management service that
21provides (1) guidance, educational programs, or advice for the
22purpose of addressing budgeting, personal finance, financial
23literacy, saving and spending practices, or the sound use of
24consumer credit; or (2) assistance or offers to assist

 

 

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1individuals and families with financial problems by providing
2counseling; or (3) a combination of the activities described
3in items (1) and (2) of this definition.
4    "Debt management service" means the planning and
5management of the financial affairs of a debtor for a fee and
6the receiving of money from the debtor for the purpose of
7distributing it to the debtor's creditors in payment or
8partial payment of the debtor's obligations or soliciting
9financial contributions from creditors. The business of debt
10management is conducted in this State if the debt management
11business, its employees, or its agents are located in this
12State or if the debt management business solicits or contracts
13with debtors located in this State. "Debt management service"
14does not include "debt settlement service" as defined in the
15Debt Settlement Consumer Protection Act.
16    This term shall not include the following when engaged in
17the regular course of their respective businesses and
18professions:
19        (a) Attorneys at law licensed, or otherwise authorized
20    to practice, in Illinois who are engaged in the practice
21    of law.
22        (b) Banks, operating subsidiaries of banks, affiliates
23    of banks, fiduciaries, credit unions, savings and loan
24    associations, and savings banks as duly authorized and
25    admitted to transact business in the State of Illinois and
26    performing credit and financial adjusting service in the

 

 

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1    regular course of their principal business.
2        (c) Title insurers, title agents, independent
3    escrowees, and abstract companies, while doing an escrow
4    business.
5        (d) Judicial officers or others acting pursuant to
6    court order.
7        (e) Employers for their employees, except that no
8    employer shall retain the services of an outside debt
9    management service to perform this service unless the debt
10    management service is licensed pursuant to this Act.
11        (f) Bill payment services, as defined in the
12    Transmitters of Money Act.
13        (g) Credit counselors, only when providing services
14    described in the definition of credit counselor in this
15    Section.
16    "Debtor" means the person or persons for whom the debt
17management service is performed.
18    "Department" means the Department of Financial and
19Professional Regulation.
20    "Director" means the Director of Financial Institutions.
21    "Division of Financial Institutions" means the Division of
22Financial Institutions of the Department of Financial and
23Professional Regulation.
24    "Email address of record" means the designated email
25address recorded by the Division of Financial Institutions in
26the applicant's applicant file or the licensee's license file,

 

 

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1as maintained by the Division of Financial Institutions'
2licensure unit.
3    "Person" means an individual, firm, partnership,
4association, limited liability company, corporation, or
5not-for-profit corporation.
6    "Licensee" means a person licensed under this Act.
7    "Secretary" means the Secretary of Financial and
8Professional Regulation or a person authorized by the
9Secretary to act in the Secretary's stead.
10(Source: P.A. 100-201, eff. 8-18-17.)
 
11    (205 ILCS 665/4)  (from Ch. 17, par. 5304)
12    Sec. 4. Application for license. Application for a license
13to engage in the debt management service business in this
14State shall be made to the Secretary and shall be in writing,
15under oath, and in the form prescribed by the Secretary. Each
16applicant shall provide an email address of record.
17    Each applicant, at the time of making such application,
18shall pay to the Secretary the sum of $30.00 as a fee for
19investigation of the applicant, and the additional sum of
20$100.00 as a license fee.
21    Every applicant shall submit to the Secretary, at the time
22of the application for a license, a bond to be approved by the
23Secretary in which the applicant shall be the obligor, in the
24sum of $25,000 or such additional amount as required by the
25Secretary based on the amount of disbursements made by the

 

 

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1licensee in the previous year, and in which an insurance
2company, which is duly authorized by the State of Illinois, to
3transact the business of fidelity and surety insurance shall
4be a surety.
5    The bond shall run to the Secretary for the use of the
6Department or of any person or persons who may have a cause of
7action against the obligor in said bond arising out of any
8violation of this Act or rules by a license. Such bond shall be
9conditioned that the obligor will faithfully conform to and
10abide by the provisions of this Act and of all rules,
11regulations and directions lawfully made by the Secretary and
12will pay to the Secretary or to any person or persons any and
13all money that may become due or owing to the State or to such
14person or persons, from said obligor under and by virtue of the
15provisions of this Act.
16(Source: P.A. 96-1420, eff. 8-3-10.)
 
17    (205 ILCS 665/10)  (from Ch. 17, par. 5310)
18    Sec. 10. Revocation, suspension, or refusal to renew
19license.
20    (a) The Secretary may revoke or suspend or refuse to renew
21any license if he finds that:
22        (1) any licensee has failed to pay the annual license
23    fee, or to maintain in effect the bond required under the
24    provisions of this Act;
25        (2) the licensee has violated any provisions of this

 

 

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1    Act or any rule, lawfully made by the Secretary within the
2    authority of this Act;
3        (3) any fact or condition exists which, if it had
4    existed at the time of the original application for a
5    license, would have warranted the Secretary in refusing
6    its issuance; or
7        (4) any applicant has made any false statement or
8    representation to the Secretary in applying for a license
9    hereunder.
10    (b) In every case in which a license is suspended or
11revoked or an application for a license or renewal of a license
12is denied, the Secretary shall serve notice of his action,
13including a statement of the reasons for his actions, either
14personally, to the email address of record, or by certified
15mail, return receipt requested. Service by mail shall be
16deemed completed if the notice is deposited in the United
17States mail U.S. Mail. Service to the email address of record
18shall be deemed completed when sent.
19    (c) In the case of a denial of an application or renewal of
20a license, the applicant or licensee may request in writing,
21within 30 days after the date of service, a hearing. In the
22case of a denial of a renewal of a license, the license shall
23be deemed to continue in force until 30 days after the service
24of the notice of denial, or if a hearing is requested during
25that period, until a final administrative order is entered.
26    (d) An order of revocation or suspension of a license

 

 

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1shall take effect upon service of the order unless the
2licensee requests, in writing, within 10 days after the date
3of service, a hearing. In the event a hearing is requested, the
4order shall be stayed until a final administrative order is
5entered.
6    (e) If the licensee requests a hearing, the Secretary
7shall schedule either a status date or a hearing within 30 days
8after the request for a hearing unless otherwise agreed to by
9the parties.
10    (f) The hearing shall be held at the time and place
11designated by the Secretary. The Secretary and any
12administrative law judge designated by him have the power to
13administer oaths and affirmations, subpoena witnesses and
14compel their attendance, take evidence, and require the
15production of books, papers, correspondence, and other records
16or information that he considers relevant or material to the
17injury.
18    (g) The costs for the administrative hearing shall be set
19by rule and shall be borne by the respondent.
20(Source: P.A. 96-1420, eff. 8-3-10.)
 
21    (205 ILCS 665/20)  (from Ch. 17, par. 5323)
22    Sec. 20. Cease and desist orders.
23    (a) The Secretary may issue a cease and desist order to any
24licensee, or other person doing business without the required
25license, when in the opinion of the Secretary, the licensee,

 

 

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1or other person, is violating or is about to violate any
2provision of the Act or any rule or condition imposed in
3writing by the Department.
4    (b) The Secretary may issue a cease and desist order prior
5to a hearing.
6    (c) The Secretary shall serve notice of his action,
7including a statement of the reasons for his action either
8personally, to the email address of record, or by certified
9mail, return receipt requested. Service by mail shall be
10deemed completed if the notice is deposited in the U.S. Mail.
11Service to the email address of record shall be deemed
12completed when sent.
13    (d) Within 10 days after service of the cease and desist
14order, the licensee or other person may request, in writing, a
15hearing.
16    (e) The Secretary shall schedule either a status date or a
17hearing within 30 days after the request for a hearing unless
18otherwise agreed to by the parties.
19    (g) If it is determined that the Secretary had the
20authority to issue the cease and desist order, he may issue
21such orders as may be reasonably necessary to correct,
22eliminate, or remedy such conduct.
23    (h) The powers vested in the Secretary by this Section are
24additional to any and all other powers and remedies vested in
25the Secretary by law, and nothing in this Section shall be
26construed as requiring that the Secretary shall employ the

 

 

HB3693- 51 -LRB103 28809 BMS 55194 b

1power conferred in this Section instead of or as a condition
2precedent to the exercise of any other power or remedy vested
3in the Secretary.
4    (i) The cost for the administrative hearing shall be set
5by rule and shall be borne by the respondent.
6(Source: P.A. 96-1420, eff. 8-3-10.)
 
7    Section 25. The Consumer Installment Loan Act is amended
8by changing Sections 2, 3, 8, 9, and 20.5 and by adding Section
90.5 as follows:
 
10    (205 ILCS 670/0.5 new)
11    Sec. 0.5. Definitions. As used in this Act:
12    "Department" means the Department of Financial and
13Professional Regulation.
14    "Director" means the Director of the Division of Financial
15Institutions.
16    "Division of Financial Institutions" means the Division of
17Financial Institutions of the Department of Financial and
18Professional Regulation.
19    "Email address of record" means the designated email
20address recorded by the Division of Financial Institutions in
21the applicant's applicant file or the licensee's license file,
22as maintained by the Division of Financial Institutions'
23licensure unit.
24    "Secretary" means the Secretary of Financial and

 

 

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1Professional Regulation or a person authorized by the
2Secretary to act in the Secretary's stead.
 
3    (205 ILCS 670/2)  (from Ch. 17, par. 5402)
4    Sec. 2. Application; fees; positive net worth. Application
5for such license shall be in writing, and in the form
6prescribed by the Director. Such applicant at the time of
7making such application shall pay to the Director the sum of
8$300 as an application fee and the additional sum of $450 as an
9annual license fee, for a period terminating on the last day of
10the current calendar year; provided that if the application is
11filed after June 30th in any year, such license fee shall be
121/2 of the annual license fee for such year. At the time of
13application, each applicant shall provide an email address of
14record.
15    Before the license is granted, every applicant shall prove
16in form satisfactory to the Director that the applicant has
17and will maintain a positive net worth of a minimum of $30,000.
18Every applicant and licensee shall maintain a surety bond in
19the principal sum of $25,000 issued by a bonding company
20authorized to do business in this State and which shall be
21approved by the Director. Such bond shall run to the Director
22and shall be for the benefit of any consumer who incurs damages
23as a result of any violation of the Act or rules by a licensee.
24If the Director finds at any time that a bond is of
25insufficient size, is insecure, exhausted, or otherwise

 

 

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1doubtful, an additional bond in such amount as determined by
2the Director shall be filed by the licensee within 30 days
3after written demand therefor by the Director. "Net worth"
4means total assets minus total liabilities.
5(Source: P.A. 92-398, eff. 1-1-02; 93-32, eff. 7-1-03.)
 
6    (205 ILCS 670/3)  (from Ch. 17, par. 5403)
7    Sec. 3. Appointment of attorney-in-fact for service of
8process. Every licensee shall appoint, in writing, the
9Director of Financial Institutions (hereinafter called
10Director) and his successors in office or any official who
11shall hereafter be charged with the administration of this
12Act, as attorney-in-fact upon whom all lawful process against
13such licensee may be served with the same legal force and
14validity as if served on such licensee. A copy of such written
15appointment, duly certified, shall be filed in the office of
16the Director; and a copy thereof certified by him shall be
17sufficient evidence. This appointment shall remain in effect
18while any liability remains outstanding in this State against
19the licensee. When summons is served upon the Director as
20attorney-in-fact for such licensee, the Director shall
21immediately notify the licensee by certified registered mail,
22return receipt requested, or by email to the email address of
23record, enclosing the summons and specifying the hour and day
24of service. Service by certified mail shall be deemed
25completed when the notice is deposited in the United States

 

 

HB3693- 54 -LRB103 28809 BMS 55194 b

1mail. Service to the email address of record shall be deemed
2completed when sent.
3(Source: Laws 1963, p. 3526.)
 
4    (205 ILCS 670/8)  (from Ch. 17, par. 5408)
5    Sec. 8. Annual license fee; expenses fee - Expenses.
6Before the 1st day of each December, a licensee must pay to the
7Director, and the Department must receive, the annual license
8fee required by Section 2 for the next succeeding calendar
9year. The license shall expire on the first of January unless
10the license fee has been paid prior thereto. At the time of
11renewal, each licensee shall provide an email address of
12record.
13    In addition to such license fee, the reasonable expense of
14any examination, investigation or custody by the Director
15under any provisions of this Act shall be borne by the
16licensee.
17    If a licensee fails to renew his or her license by the 31st
18day of December, it shall automatically expire and the
19licensee is not entitled to a hearing; however, the Director,
20in his or her discretion, may reinstate an expired license
21upon payment of the annual renewal fee and proof of good cause
22for failure to renew.
23(Source: P.A. 100-958, eff. 8-19-18.)
 
24    (205 ILCS 670/9)  (from Ch. 17, par. 5409)

 

 

HB3693- 55 -LRB103 28809 BMS 55194 b

1    Sec. 9. Fines; suspension or revocation , Suspension or
2Revocation of license.
3    (a) The Director may, after 10 days notice by certified
4registered mail to the licensee at the address set forth in the
5license, or by email to the email address of record, stating
6the contemplated action and in general the grounds therefor,
7fine such licensee an amount not exceeding $10,000 per
8violation, or revoke or suspend any license issued hereunder
9if he or she finds that:
10        (1) The licensee has failed to comply with any
11    provision of this Act or any order, decision, finding,
12    rule, regulation or direction of the Director lawfully
13    made pursuant to the authority of this Act; or
14        (2) Any fact or condition exists which, if it had
15    existed at the time of the original application for the
16    license, clearly would have warranted the Director in
17    refusing to issue the license.
18    Service by certified mail shall be deemed completed when
19the notice is deposited in the United States mail. Service to
20the email address of record shall be deemed completed when
21sent.
22    (b) The Director may fine, suspend, or revoke only the
23particular license with respect to which grounds for the fine,
24revocation or suspension occur or exist, but if the Director
25shall find that grounds for revocation are of general
26application to all offices or to more than one office of the

 

 

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1licensee, the Director shall fine, suspend, or revoke every
2license to which such grounds apply.
3    (c) (Blank).
4    (d) No revocation, suspension, or surrender of any license
5shall impair or affect the obligation of any pre-existing
6lawful contract between the licensee and any obligor.
7    (e) The Director may issue a new license to a licensee
8whose license has been revoked when facts or conditions which
9clearly would have warranted the Director in refusing
10originally to issue the license no longer exist.
11    (f) (Blank).
12    (g) In every case in which a license is suspended or
13revoked or an application for a license or renewal of a license
14is denied, the Director shall serve the licensee with notice
15of his or her action, including a statement of the reasons for
16his or her actions, either personally, to the email address of
17record, or by certified mail, return receipt requested.
18Service by certified mail shall be deemed completed when the
19notice is deposited in the United States mail U.S. Mail.
20Service to the email address of record shall be deemed
21completed when sent.
22    (h) An order assessing a fine, an order revoking or
23suspending a license or, an order denying renewal of a license
24shall take effect upon service of the order unless the
25licensee requests, in writing, within 10 days after the date
26of service, a hearing. In the event a hearing is requested, the

 

 

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1order shall be stayed until a final administrative order is
2entered.
3    (i) If the licensee requests a hearing, the Director shall
4schedule a hearing within 30 days after the request for a
5hearing unless otherwise agreed to by the parties.
6    (j) The hearing shall be held at the time and place
7designated by the Director. The Director and any
8administrative law judge designated by him or her shall have
9the power to administer oaths and affirmations, subpoena
10witnesses and compel their attendance, take evidence, and
11require the production of books, papers, correspondence, and
12other records or information that he or she considers relevant
13or material to the inquiry.
14    (k) The costs for the administrative hearing shall be set
15by rule.
16    (l) The Director shall have the authority to prescribe
17rules for the administration of this Section.
18    (m) The Department shall establish by rule and publish a
19schedule of fines that are reasonably tailored to ensure
20compliance with the provisions of this Act and which include
21remedial measures intended to improve licensee compliance.
22Such rules shall set forth the standards and procedures to be
23used in imposing any such fines and remedies.
24(Source: P.A. 98-209, eff. 1-1-14.)
 
25    (205 ILCS 670/20.5)

 

 

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1    Sec. 20.5. Cease and desist.
2    (a) The Director may issue a cease and desist order to any
3licensee, or other person doing business without the required
4license, when in the opinion of the Director, the licensee, or
5other person, is violating or is about to violate any
6provision of this Act or any rule or requirement imposed in
7writing by the Department as a condition of granting any
8authorization permitted by this Act.
9    (b) The Director may issue a cease and desist order prior
10to a hearing.
11    (c) The Director shall serve notice of his or her action,
12designated as a cease and desist order made pursuant to this
13Section, including a statement of the reasons for the action,
14either personally, to the email address of record, or by
15certified mail, return receipt requested. Service by certified
16mail shall be deemed completed when the notice is deposited in
17the United States U.S. mail. Service to the email address of
18record shall be deemed completed when sent.
19    (d) Within 15 days of service of the cease and desist
20order, the licensee or other person may request, in writing, a
21hearing.
22    (e) The Director shall schedule a hearing within 30 days
23after the request for a hearing unless otherwise agreed to by
24the parties.
25    (f) The Director shall have the authority to prescribe
26rules for the administration of this Section.

 

 

HB3693- 59 -LRB103 28809 BMS 55194 b

1    (g) If it is determined that the Director had the
2authority to issue the cease and desist order, he or she may
3issue such orders as may be reasonably necessary to correct,
4eliminate, or remedy such conduct.
5    (h) The powers vested in the Director by this Section are
6additional to any and all other powers and remedies vested in
7the Director by law, and nothing in this Section shall be
8construed as requiring that the Director shall employ the
9power conferred in this Section instead of or as a condition
10precedent to the exercise of any other power or remedy vested
11in the Director.
12    (i) The cost for the administrative hearing shall be set
13by rule.
14(Source: P.A. 90-437, eff. 1-1-98.)
 
15    Section 30. The Debt Settlement Consumer Protection Act is
16amended by changing Sections 10, 20, 50, 80, and 95 as follows:
 
17    (225 ILCS 429/10)
18    Sec. 10. Definitions. As used in this Act:
19    "Consumer" means any person who purchases or contracts for
20the purchase of debt settlement services or a student loan
21borrower.
22    "Consumer settlement account" means any account or other
23means or device in which payments, deposits, or other
24transfers from a consumer are arranged, held, or transferred

 

 

HB3693- 60 -LRB103 28809 BMS 55194 b

1by or to a debt settlement provider for the accumulation of the
2consumer's funds in anticipation of proffering an adjustment
3or settlement of a debt or obligation of the consumer to a
4creditor on behalf of the consumer.
5    "Debt settlement provider" means: (1) any person or entity
6engaging in, or holding itself out as engaging in, the
7business of providing debt settlement service in exchange for
8any fee or compensation; (2) any person who solicits for or
9acts on behalf of any person or entity engaging in, or holding
10itself out as engaging in, the business of providing debt
11settlement service in exchange for any fee or compensation;
12(3) any person or entity engaging in, or holding itself out as
13engaging in the business of student loan debt relief services
14in exchange for any fee or compensation assessed against or
15charged to a consumer; or (4) any person who solicits for or
16acts on behalf of such person or entity engaging in or holding
17itself out as engaging in, the business of student loan debt
18relief services in exchange for any fee or compensation
19assessed against or charged to a consumer. "Debt settlement
20provider" does not include:
21        (1) attorneys licensed, or otherwise authorized, to
22    practice in Illinois who are engaged in the practice of
23    law;
24        (2) escrow agents, accountants, broker dealers in
25    securities, or investment advisors in securities, when
26    acting in the ordinary practice of their professions and

 

 

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1    through the entity used in the ordinary practice of their
2    profession;
3        (3) any bank, agent of a bank, operating subsidiary of
4    a bank, affiliate of a bank, trust company, savings and
5    loan association, savings bank, credit union, crop credit
6    association, development credit corporation, industrial
7    development corporation, title insurance company, title
8    insurance agent, independent escrowee or insurance company
9    operating or organized under the laws of a state or the
10    United States, or any other person authorized to make
11    loans under State law while acting in the ordinary
12    practice of that business;
13        (4) any person who performs credit services for his or
14    her employer while receiving a regular salary or wage when
15    the employer is not engaged in the business of offering or
16    providing debt settlement service;
17        (5) a collection agency licensed pursuant to the
18    Collection Agency Act that is collecting a debt on its own
19    behalf or on behalf of a third party;
20        (6) an organization that is described in Section
21    501(c)(3) and subject to Section 501(q) of Title 26 of the
22    United States Code and exempt from tax under Section
23    501(a) of Title 26 of the United States Code and governed
24    by the Debt Management Service Act;
25        (7) public officers while acting in their official
26    capacities and persons acting under court order;

 

 

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1        (8) any person while performing services incidental to
2    the dissolution, winding up, or liquidating of a
3    partnership, corporation, or other business enterprise;
4        (9) persons licensed under the Real Estate License Act
5    of 2000 when acting in the ordinary practice of their
6    profession and not holding themselves out as debt
7    settlement providers; or
8        (10) any institution of higher education as defined in
9    the Higher Education Act of 1965, 20 U.S.C. 1001.
10    "Debt settlement service" means:
11        (1) offering to provide advice or service, or acting
12    as an intermediary between or on behalf of a consumer and
13    one or more of a consumer's creditors, where the primary
14    purpose of the advice, service, or action is to obtain a
15    settlement, adjustment, or satisfaction of the consumer's
16    unsecured debt to a creditor in an amount less than the
17    full amount of the principal amount of the debt or in an
18    amount less than the current outstanding balance of the
19    debt;
20        (2) offering to provide services related to or
21    providing services advising, encouraging, assisting, or
22    counseling a consumer to accumulate funds for the primary
23    purpose of proposing or obtaining or seeking to obtain a
24    settlement, adjustment, or satisfaction of the consumer's
25    unsecured debt to a creditor in an amount less than the
26    full amount of the principal amount of the debt or in an

 

 

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1    amount less than the current outstanding balance of the
2    debt; or
3        (3) student loan debt relief.
4    "Debt settlement service" does not include (A) the
5services of attorneys licensed, or otherwise authorized, to
6practice in Illinois who are engaged in the practice of law,
7(B) debt management service as defined in the Debt Management
8Service Act, (C) the services of a student loan servicer, as
9defined in the Student Loan Servicing Rights Act, or (D) the
10services of any other originator, guarantor, or servicer of
11federal education loans or private education loans.
12    "Department" means the Department of Financial and
13Professional Regulation.
14    "Director" means the Director of the Division of Financial
15Institutions.
16    "Division of Financial Institutions" means the Division of
17Financial Institutions of the Department of Financial and
18Professional Regulation.
19    "Email address of record" means the designated email
20address recorded by the Division of Financial Institutions in
21the applicant's applicant file or the licensee's license file,
22as maintained by the Division of Financial Institutions'
23licensure unit.
24    "Enrollment or set up fee" means any fee, obligation, or
25compensation paid or to be paid by the consumer to a debt
26settlement provider in consideration of or in connection with

 

 

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1establishing a contract or other agreement with a consumer
2related to the provision of debt settlement service.
3    "Federal education loan" means any loan made, guaranteed,
4or insured under Title IV of the federal Higher Education Act
5of 1965.
6    "Maintenance fee" means any fee, obligation, or
7compensation paid or to be paid by the consumer on a periodic
8basis to a debt settlement provider in consideration of
9maintaining the relationship and services to be provided by a
10debt settlement provider in accordance with a contract with a
11consumer related to the provision of debt settlement service.
12    "Principal amount of the debt" means the total amount or
13outstanding balance owed by a consumer to one or more
14creditors for a debt that is included in a contract for debt
15settlement service at the time when the consumer enters into a
16contract for debt settlement service.
17    "Savings" means the difference between the principal
18amount of the debt and the amount paid by the debt settlement
19provider to the creditor or negotiated by the debt settlement
20provider and paid by the consumer to the creditor pursuant to a
21settlement negotiated by the debt settlement provider on
22behalf of the consumer as full and complete satisfaction of
23the creditor's claim with regard to that debt.
24    "Secretary" means the Secretary of Financial and
25Professional Regulation or a person authorized by the
26Secretary to act in the Secretary's stead.

 

 

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1    "Settlement fee" means any fee, obligation, or
2compensation paid or to be paid by the consumer to a debt
3settlement provider in consideration of or in connection with
4a completed agreement or other arrangement on the part of a
5creditor to accept less than the principal amount of the debt
6as satisfaction of the creditor's claim against the consumer.
7    "Student loan borrower" means a person who has received or
8agreed to pay a student loan for his or her own educational
9expenses; a parent, grandparent, or other family member who
10has received or agreed to pay a student loan for a family
11member receiving the education; or any co-signer who has
12agreed to share responsibility for repaying a student loan
13with the person receiving the education.
14    "Student loan debt relief" means, in exchange for any fee
15or compensation assessed against or charged to a student loan
16borrower, offering to provide advice or service, or acting as
17an intermediary between or on behalf of a consumer and the
18United States Department of Education or any other originator
19or guarantor of federal education loans or one or more of the
20servicers of a student loan borrower's federal education loan,
21where the primary purpose of the advice, service, or action is
22to (1) negotiate, arrange, or obtain a settlement, adjustment,
23discharge, or satisfaction of the student loan borrower's
24federal education loan debt in an amount less than the full
25amount of the principal amount of the debt, a reduction or
26alteration to the interest rate, a reduction or alteration in

 

 

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1the amount of monthly payment or fees owed, or in an amount
2less than the current outstanding balance of the debt, (2)
3enroll the student loan borrower in a repayment plan,
4forbearance, or deferment of his or her federal education loan
5debt, (3) apply for consolidation or consolidate the student
6loan borrower's federal education loans, or (4) offer to
7provide any other services related to altering the terms of a
8student loan borrower's federal education loan debt,
9including, but not limited to, a reduction in the amount of
10interest, the principal balance, or the amount of monthly
11payment or fees owed.
12(Source: P.A. 102-298, eff. 8-6-21.)
 
13    (225 ILCS 429/20)
14    Sec. 20. Application for license. An application for a
15license to operate as a debt settlement provider in this State
16shall be made to the Secretary and shall be in writing, under
17oath, and in the form prescribed by the Secretary. Each
18applicant shall provide an email address of record.
19    Each applicant, at the time of making such application,
20shall pay to the Secretary the required fee as set by rule.
21    Every applicant shall submit to the Secretary, at the time
22of the application for a license, a bond to be approved by the
23Secretary in which the applicant shall be the obligor, in the
24sum of $100,000 or an additional amount as required by the
25Secretary, and in which an insurance company, which is duly

 

 

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1authorized by the State of Illinois to transact the business
2of fidelity and surety insurance, shall be a surety.
3    The bond shall run to the Secretary for the use of the
4Department or of any person or persons who may have a cause of
5action against the obligor in said bond arising out of any
6violation of this Act or rules by a debt settlement provider.
7Such bond shall be conditioned that the obligor must
8faithfully conform to and abide by the provisions of this Act
9and of all rules, regulations, and directions lawfully made by
10the Secretary and pay to the Secretary or to any person or
11persons any and all money that may become due or owing to the
12State or to such person or persons, from the obligor under and
13by virtue of the provisions of this Act.
14(Source: P.A. 96-1420, eff. 8-3-10.)
 
15    (225 ILCS 429/50)
16    Sec. 50. Revocation or suspension of license.
17    (a) The Secretary may revoke or suspend any license if he
18or she finds that:
19        (1) any debt settlement provider has failed to pay the
20    annual license fee or to maintain in effect the bond
21    required under the provisions of this Act;
22        (2) the debt settlement provider has violated any
23    provisions of this Act or any rule lawfully made by the
24    Secretary under the authority of this Act;
25        (3) any fact or condition exists that, if it had

 

 

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1    existed at the time of the original application for a
2    license, would have warranted the Secretary in refusing
3    its issuance; or
4        (4) any applicant has made any false statement or
5    representation to the Secretary in applying for a license
6    under this Act.
7    (b) In every case in which a license is suspended or
8revoked or an application for a license or renewal of a license
9is denied, the Secretary shall serve notice of his or her
10action, including a statement of the reasons for his or her
11actions, either personally, to the email address of record, or
12by certified mail, return receipt requested. Service by mail
13shall be deemed completed if the notice is deposited in the
14United States mail U.S. Mail. Service to the email address of
15record shall be deemed completed when sent.
16    (c) In the case of a denial of an application or renewal of
17a license, the applicant or debt settlement provider may
18request, in writing, a hearing within 30 days after the date of
19service. In the case of a denial of a renewal of a license, the
20license shall be deemed to continue in force until 30 days
21after the service of the notice of denial, or if a hearing is
22requested during that period, until a final administrative
23order is entered.
24    (d) An order of revocation or suspension of a license
25shall take effect upon service of the order unless the debt
26settlement provider requests, in writing, a hearing within 10

 

 

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1days after the date of service. In the event a hearing is
2requested, the order shall be stayed until a final
3administrative order is entered.
4    (e) If the debt settlement provider requests a hearing,
5then the Secretary shall schedule the hearing within 30 days
6after the request for a hearing unless otherwise agreed to by
7the parties.
8    (f) The hearing shall be held at the time and place
9designated by the Secretary. The Secretary and any
10administrative law judge designated by the Secretary have the
11power to administer oaths and affirmations, subpoena witnesses
12and compel their attendance, take evidence, and require the
13production of books, papers, correspondence, and other records
14or information that the Secretary considers relevant or
15material to the injury.
16    (g) The costs for the administrative hearing shall be set
17by rule.
18(Source: P.A. 96-1420, eff. 8-3-10.)
 
19    (225 ILCS 429/80)
20    Sec. 80. Penalties.
21    (a) Any person who operates as a debt settlement provider
22without a license shall be guilty of a Class 4 felony.
23    (b) Any contract of debt settlement service as defined in
24this Act made by an unlicensed person shall be null and void
25and of no legal effect.

 

 

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1    (c) The Secretary may, after 10 days notice by certified
2registered mail to the debt settlement service provider at the
3address on the license or unlicensed entity engaging in the
4debt settlement service business, or by email to the email
5address of record, stating the contemplated action and in
6general the grounds therefore, fine such debt settlement
7service provider or unlicensed entity an amount not exceeding
8$10,000 per violation, and revoke or suspend any license
9issued hereunder if he or she finds that:
10        (1) The debt settlement service provider has failed to
11    comply with any provision of this Act or any order,
12    decision, finding, rule, regulation or direction of the
13    Secretary lawfully made pursuant to the authority of this
14    Act; or
15        (2) Any fact or condition exists which, if it had
16    existed at the time of the original application for the
17    license, clearly would have warranted the Secretary in
18    refusing to issue the license.
19    Service by certified mail shall be deemed completed when
20the notice is deposited in the United States mail. Service to
21the email address of record shall be deemed completed when
22sent.
23(Source: P.A. 96-1420, eff. 8-3-10.)
 
24    (225 ILCS 429/95)
25    Sec. 95. Cease and desist orders.

 

 

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1    (a) The Secretary may issue a cease and desist order to any
2debt settlement provider or other person doing business
3without the required license when, in the opinion of the
4Secretary, the debt settlement provider or other person is
5violating or is about to violate any provision of the Act or
6any rule or condition imposed in writing by the Department.
7    (b) The Secretary may issue a cease and desist order prior
8to a hearing.
9    (c) The Secretary shall serve notice of his or her action,
10including a statement of the reasons for his or her action
11either personally, to the email address of record, or by
12certified mail, return receipt requested. Service by mail
13shall be deemed completed if the notice is deposited in the
14United States mail U.S. Mail. Service to the email address of
15record shall be deemed completed when sent.
16    (d) Within 10 days after service of the cease and desist
17order, the licensee or other person may request, in writing, a
18hearing.
19    (e) The Secretary shall schedule a hearing within 30 days
20after the request for a hearing unless otherwise agreed to by
21the parties.
22    (f) If it is determined that the Secretary had the
23authority to issue the cease and desist order, then he or she
24may issue such orders as may be reasonably necessary to
25correct, eliminate, or remedy that conduct.
26    (g) The powers vested in the Secretary by this Section are

 

 

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1additional to any and all other powers and remedies vested in
2the Secretary by law, and nothing in this Section shall be
3construed as requiring that the Secretary shall employ the
4power conferred in this Section instead of or as a condition
5precedent to the exercise of any other power or remedy vested
6in the Secretary.
7    (h) The cost for the administrative hearing shall be set
8by rule.
9(Source: P.A. 96-1420, eff. 8-3-10.)
 
10    Section 35. The Payday Loan Reform Act is amended by
11changing Sections 1-10, 3-5, and 4-10 as follows:
 
12    (815 ILCS 122/1-10)
13    Sec. 1-10. Definitions. As used in this Act:
14    "Check" means a "negotiable instrument", as defined in
15Article 3 of the Uniform Commercial Code, that is drawn on a
16financial institution.
17    "Commercially reasonable method of verification" or
18"certified database" means a consumer reporting service
19database certified by the Department as effective in verifying
20that a proposed loan agreement is permissible under this Act,
21or, in the absence of the Department's certification, any
22reasonably reliable written verification by the consumer
23concerning (i) whether the consumer has any outstanding payday
24loans, (ii) the principal amount of those outstanding payday

 

 

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1loans, and (iii) whether any payday loans have been paid in
2full by the consumer in the preceding 7 days.
3    "Consumer" means any natural person who, singly or jointly
4with another consumer, enters into a loan.
5    "Consumer reporting service" means an entity that provides
6a database certified by the Department.
7    "Department" means the Department of Financial and
8Professional Regulation.
9    "Director" means the Director of the Division of Financial
10Institutions.
11    "Division of Financial Institutions" means the Division of
12Financial Institutions of the Department of Financial and
13Professional Regulation.
14    "Email address of record" means the designated email
15address recorded by the Division of Financial Institutions in
16the applicant's applicant file or the licensee's license file,
17as maintained by the Division of Financial Institutions'
18licensure unit.
19    "Secretary" means the Secretary of Financial and
20Professional Regulation or a person authorized by the
21Secretary to act in the Secretary's stead.
22    "Gross monthly income" means monthly income as
23demonstrated by official documentation of the income,
24including, but not limited to, a pay stub or a receipt
25reflecting payment of government benefits, for the period 30
26days prior to the date on which the loan is made.

 

 

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1    "Lender" and "licensee" mean any person or entity,
2including any affiliate or subsidiary of a lender or licensee,
3that offers or makes a payday loan, buys a whole or partial
4interest in a payday loan, arranges a payday loan for a third
5party, or acts as an agent for a third party in making a payday
6loan, regardless of whether approval, acceptance, or
7ratification by the third party is necessary to create a legal
8obligation for the third party, and includes any other person
9or entity if the Department determines that the person or
10entity is engaged in a transaction that is in substance a
11disguised payday loan or a subterfuge for the purpose of
12avoiding this Act.
13    "Loan agreement" means a written agreement between a
14lender and consumer to make a loan to the consumer, regardless
15of whether any loan proceeds are actually paid to the consumer
16on the date on which the loan agreement is made.
17    "Member of the military" means a person serving in the
18armed forces of the United States, the Illinois National
19Guard, or any reserve component of the armed forces of the
20United States. "Member of the military" includes those persons
21engaged in (i) active duty, (ii) training or education under
22the supervision of the United States preliminary to induction
23into military service, or (iii) a period of active duty with
24the State of Illinois under Title 10 or Title 32 of the United
25States Code pursuant to order of the President or the Governor
26of the State of Illinois.

 

 

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1    "Outstanding balance" means the total amount owed by the
2consumer on a loan to a lender, including all principal,
3finance charges, fees, and charges of every kind.
4    "Payday loan" or "loan" means a loan with a term that does
5not exceed 120 days, including any transaction conducted via
6any medium whatsoever, including, but not limited to, paper,
7facsimile, Internet, or telephone, in which:
8        (1) A lender accepts one or more checks dated on the
9    date written and agrees to hold them for a period of days
10    before deposit or presentment, or accepts one or more
11    checks dated subsequent to the date written and agrees to
12    hold them for deposit; or
13        (2) A lender accepts one or more authorizations to
14    debit a consumer's bank account; or
15        (3) A lender accepts an interest in a consumer's
16    wages, including, but not limited to, a wage assignment.
17    "Principal amount" means the amount received by the
18consumer from the lender due and owing on a loan, excluding any
19finance charges, interest, fees, or other loan-related
20charges.
21    "Rollover" means to refinance, renew, amend, or extend a
22loan beyond its original term.
23(Source: P.A. 101-658, eff. 3-23-21.)
 
24    (815 ILCS 122/3-5)
25    Sec. 3-5. Licensure.

 

 

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1    (a) A license to make a payday loan shall state the
2address, including city and state, at which the business is to
3be conducted and shall state fully the name of the licensee.
4The license shall be conspicuously posted in the place of
5business of the licensee and shall not be transferable or
6assignable.
7    (b) An application for a license shall be in writing and in
8a form prescribed by the Secretary. Each applicant shall
9provide an email address of record. The Secretary may not
10issue a payday loan license unless and until the following
11findings are made:
12        (1) that the financial responsibility, experience,
13    character, and general fitness of the applicant are such
14    as to command the confidence of the public and to warrant
15    the belief that the business will be operated lawfully and
16    fairly and within the provisions and purposes of this Act;
17    and
18        (2) that the applicant has submitted such other
19    information as the Secretary may deem necessary.
20    (c) A license shall be issued for no longer than one year,
21and no renewal of a license may be provided if a licensee has
22substantially violated this Act and has not cured the
23violation to the satisfaction of the Department.
24    (d) A licensee shall appoint, in writing, the Secretary as
25attorney-in-fact upon whom all lawful process against the
26licensee may be served with the same legal force and validity

 

 

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1as if served on the licensee. A copy of the written
2appointment, duly certified, shall be filed in the office of
3the Secretary, and a copy thereof certified by the Secretary
4shall be sufficient evidence to subject a licensee to
5jurisdiction in a court of law. This appointment shall remain
6in effect while any liability remains outstanding in this
7State against the licensee. When summons is served upon the
8Secretary as attorney-in-fact for a licensee, the Secretary
9shall immediately notify the licensee by certified registered
10mail, return receipt requested, or to the email address of
11record, enclosing the summons and specifying the hour and day
12of service. Service by certified mail shall be deemed
13completed when the notice is deposited in the United States
14mail. Service to the email address of record shall be deemed
15completed when sent.
16    (e) A licensee must pay an annual fee of $1,000. In
17addition to the license fee, the reasonable expense of any
18examination or hearing by the Secretary under any provisions
19of this Act shall be borne by the licensee. If a licensee fails
20to renew its license by December 1, its license shall
21automatically expire; however, the Secretary, in his or her
22discretion, may reinstate an expired license upon:
23        (1) payment of the annual fee within 30 days of the
24    date of expiration; and
25        (2) proof of good cause for failure to renew.
26    (f) Not more than one place of business shall be

 

 

HB3693- 78 -LRB103 28809 BMS 55194 b

1maintained under the same license, but the Secretary may issue
2more than one license to the same licensee upon compliance
3with all the provisions of this Act governing issuance of a
4single license. The location, except those locations already
5in existence as of June 1, 2005, may not be within one mile of
6a horse race track subject to the Illinois Horse Racing Act of
71975, within one mile of a facility at which gambling is
8conducted under the Illinois Gambling Act, within one mile of
9the location at which a riverboat subject to the Illinois
10Gambling Act docks, or within one mile of any State of Illinois
11or United States military base or naval installation.
12    (g) No licensee shall conduct the business of making loans
13under this Act within any office, suite, room, or place of
14business in which (1) any loans are offered or made under the
15Consumer Installment Loan Act other than title secured loans
16as defined in subsection (a) of Section 15 of the Consumer
17Installment Loan Act and governed by Title 38, Section 110.330
18of the Illinois Administrative Code or (2) any other business
19is solicited or engaged in unless the other business is
20licensed by the Department or, in the opinion of the
21Secretary, the other business would not be contrary to the
22best interests of consumers and is authorized by the Secretary
23in writing.
24    (g-5) Notwithstanding subsection (g) of this Section, a
25licensee may obtain a license under the Consumer Installment
26Loan Act (CILA) for the exclusive purpose and use of making

 

 

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1title secured loans, as defined in subsection (a) of Section
215 of CILA and governed by Title 38, Section 110.300 of the
3Illinois Administrative Code. A licensee may continue to
4service Consumer Installment Loan Act loans that were
5outstanding as of the effective date of this amendatory Act of
6the 96th General Assembly.
7    (h) The Secretary shall maintain a list of licensees that
8shall be available to interested consumers and lenders and the
9public. The Secretary shall maintain a toll-free number
10whereby consumers may obtain information about licensees. The
11Secretary shall also establish a complaint process under which
12an aggrieved consumer may file a complaint against a licensee
13or non-licensee who violates any provision of this Act.
14(Source: P.A. 100-958, eff. 8-19-18; 101-31, eff. 6-28-19.)
 
15    (815 ILCS 122/4-10)
16    Sec. 4-10. Enforcement and remedies.
17    (a) The remedies provided in this Act are cumulative and
18apply to persons or entities subject to this Act.
19    (b) Any material violation of this Act, including the
20commission of an act prohibited under Section 4-5, constitutes
21a violation of the Consumer Fraud and Deceptive Business
22Practices Act.
23    (c) If any provision of the written agreement described in
24subsection (b) of Section 2-20 violates this Act, then that
25provision is unenforceable against the consumer.

 

 

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1    (d) Subject to the Illinois Administrative Procedure Act,
2the Secretary may hold hearings, make findings of fact,
3conclusions of law, issue cease and desist orders, have the
4power to issue fines of up to $10,000 per violation, refer the
5matter to the appropriate law enforcement agency for
6prosecution under this Act, and suspend or revoke a license
7granted under this Act. All proceedings shall be open to the
8public.
9    (e) The Secretary may issue a cease and desist order to any
10licensee or other person doing business without the required
11license, when in the opinion of the Secretary the licensee or
12other person is violating or is about to violate any provision
13of this Act or any rule or requirement imposed in writing by
14the Department as a condition of granting any authorization
15permitted by this Act. The cease and desist order permitted by
16this subsection (e) may be issued prior to a hearing.
17    The Secretary shall serve notice of his or her action,
18including, but not limited to, a statement of the reasons for
19the action, either personally, to the email address of record,
20or by certified mail, return receipt requested. Service by
21certified mail shall be deemed completed when the notice is
22deposited in the United States mail U.S. Mail. Service to the
23email address of record shall be deemed completed when sent.
24    Within 10 days of service of the cease and desist order,
25the licensee or other person may request a hearing in writing.
26The Secretary shall schedule a hearing within 30 days after

 

 

HB3693- 81 -LRB103 28809 BMS 55194 b

1the request for a hearing unless otherwise agreed to by the
2parties.
3    If it is determined that the Secretary had the authority
4to issue the cease and desist order, he or she may issue such
5orders as may be reasonably necessary to correct, eliminate,
6or remedy the conduct.
7    The powers vested in the Secretary by this subsection (e)
8are additional to any and all other powers and remedies vested
9in the Secretary by law, and nothing in this subsection (e)
10shall be construed as requiring that the Secretary shall
11employ the power conferred in this subsection instead of or as
12a condition precedent to the exercise of any other power or
13remedy vested in the Secretary.
14    (f) The Secretary may, after 10 days notice by certified
15registered mail to the licensee at the address set forth in the
16license, or by email to the email address of record, stating
17the contemplated action and in general the grounds therefore,
18fine the licensee an amount not exceeding $10,000 per
19violation, or revoke or suspend any license issued hereunder
20if he or she finds that:
21        (1) the licensee has failed to comply with any
22    provision of this Act or any order, decision, finding,
23    rule, regulation, or direction of the Secretary lawfully
24    made pursuant to the authority of this Act; or
25        (2) any fact or condition exists which, if it had
26    existed at the time of the original application for the

 

 

HB3693- 82 -LRB103 28809 BMS 55194 b

1    license, clearly would have warranted the Secretary in
2    refusing to issue the license.
3    The Secretary may fine, suspend, or revoke only the
4particular license with respect to which grounds for the fine,
5revocation, or suspension occur or exist, but if the Secretary
6finds that grounds for revocation are of general application
7to all offices or to more than one office of the licensee, the
8Secretary shall fine, suspend, or revoke every license to
9which the grounds apply.
10    The Department shall establish by rule and publish a
11schedule of fines that are reasonably tailored to ensure
12compliance with the provisions of this Act and which include
13remedial measures intended to improve licensee compliance.
14Such rules shall set forth the standards and procedures to be
15used in imposing any such fines and remedies.
16    No revocation, suspension, or surrender of any license
17shall impair or affect the obligation of any pre-existing
18lawful contract between the licensee and any obligor.
19    The Secretary may issue a new license to a licensee whose
20license has been revoked when facts or conditions which
21clearly would have warranted the Secretary in refusing
22originally to issue the license no longer exist.
23    In every case in which a license is suspended or revoked or
24an application for a license or renewal of a license is denied,
25the Secretary shall serve the licensee with notice of his or
26her action, including a statement of the reasons for his or her

 

 

HB3693- 83 -LRB103 28809 BMS 55194 b

1actions, either personally, to the email address of record, or
2by certified mail, return receipt requested. Service by
3certified mail shall be deemed completed when the notice is
4deposited in the United States mail U.S. Mail. Service to the
5email address of record shall be deemed completed when sent.
6    An order assessing a fine, an order revoking or suspending
7a license, or an order denying renewal of a license shall take
8effect upon service of the order unless the licensee requests
9a hearing, in writing, within 10 days after the date of
10service. In the event a hearing is requested, the order shall
11be stayed until a final administrative order is entered.
12    If the licensee requests a hearing, the Secretary shall
13schedule a hearing within 30 days after the request for a
14hearing unless otherwise agreed to by the parties.
15    The hearing shall be held at the time and place designated
16by the Secretary. The Secretary and any administrative law
17judge designated by him or her shall have the power to
18administer oaths and affirmations, subpoena witnesses and
19compel their attendance, take evidence, and require the
20production of books, papers, correspondence, and other records
21or information that he or she considers relevant or material
22to the inquiry.
23    (g) The costs of administrative hearings conducted
24pursuant to this Section shall be paid by the licensee.
25    (h) Notwithstanding any other provision of this Section,
26if a lender who does not have a license issued under this Act

 

 

HB3693- 84 -LRB103 28809 BMS 55194 b

1makes a loan pursuant to this Act to an Illinois consumer, then
2the loan shall be null and void and the lender who made the
3loan shall have no right to collect, receive, or retain any
4principal, interest, or charges related to the loan.
5(Source: P.A. 97-1039, eff. 1-1-13; 98-209, eff. 1-1-14.)

 

 

HB3693- 85 -LRB103 28809 BMS 55194 b

1 INDEX
2 Statutes amended in order of appearance
3    205 ILCS 305/1.1from Ch. 17, par. 4402
4    205 ILCS 305/2from Ch. 17, par. 4403
5    205 ILCS 305/8from Ch. 17, par. 4409
6    205 ILCS 305/21from Ch. 17, par. 4422
7    205 ILCS 305/61from Ch. 17, par. 4462
8    205 ILCS 657/5
9    205 ILCS 657/25
10    205 ILCS 657/40
11    205 ILCS 657/80
12    205 ILCS 657/90
13    205 ILCS 657/100
14    205 ILCS 660/2from Ch. 17, par. 5202
15    205 ILCS 660/6from Ch. 17, par. 5206
16    205 ILCS 660/10from Ch. 17, par. 5223
17    205 ILCS 660/16.5
18    205 ILCS 665/2from Ch. 17, par. 5302
19    205 ILCS 665/4from Ch. 17, par. 5304
20    205 ILCS 665/10from Ch. 17, par. 5310
21    205 ILCS 665/20from Ch. 17, par. 5323
22    205 ILCS 670/0.5 new
23    205 ILCS 670/2from Ch. 17, par. 5402
24    205 ILCS 670/3from Ch. 17, par. 5403
25    205 ILCS 670/8from Ch. 17, par. 5408

 

 

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1    205 ILCS 670/9from Ch. 17, par. 5409
2    205 ILCS 670/20.5
3    225 ILCS 429/10
4    225 ILCS 429/20
5    225 ILCS 429/50
6    225 ILCS 429/80
7    225 ILCS 429/95
8    815 ILCS 122/1-10
9    815 ILCS 122/3-5
10    815 ILCS 122/4-10