Sen. William R. Haine
Filed: 4/13/2011
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1 | AMENDMENT TO SENATE BILL 666
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2 | AMENDMENT NO. ______. Amend Senate Bill 666 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 5. The Illinois Funeral or Burial Funds Act is | ||||||
5 | amended by changing Sections 1a-1, 2, 3, and 3a-5 as follows:
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6 | (225 ILCS 45/1a-1)
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7 | Sec. 1a-1. Pre-need contracts.
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8 | (a) It shall be unlawful for any seller doing business
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9 | within
this State to accept sales proceeds from a purchaser, | ||||||
10 | either directly or
indirectly by any means, unless the seller | ||||||
11 | enters into a
pre-need contract
with the purchaser which meets | ||||||
12 | the following requirements:
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13 | (1) It states the name and address of the principal | ||||||
14 | office of the
seller and the parent company of the
seller, | ||||||
15 | if
any.
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16 | (1.5) If funded by a trust, it clearly identifies the |
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1 | trustee's name and address and the primary state or federal | ||||||
2 | regulator of the trustee as a corporate fiduciary. | ||||||
3 | (1.7) If funded by life insurance, it clearly | ||||||
4 | identifies the life insurance provider and the primary | ||||||
5 | regulator of the life insurance provider.
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6 | (2) It clearly identifies the provider's name and
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7 | address,
the purchaser, and
the beneficiary, if other than | ||||||
8 | the purchaser.
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9 | (2.5) If the provider has branch locations, the | ||||||
10 | contract
gives the purchaser the opportunity to identify | ||||||
11 | the branch
at which the funeral will be provided.
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12 | (3) It contains a complete description of the funeral | ||||||
13 | merchandise and
services to be provided and the price of | ||||||
14 | the merchandise and services, and it
clearly discloses | ||||||
15 | whether the price of the merchandise and services is
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16 | guaranteed or not guaranteed as to price.
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17 | (A) Each guaranteed price contract shall contain | ||||||
18 | the following
statement in 12 point bold type:
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19 | THIS CONTRACT GUARANTEES THE BENEFICIARY THE | ||||||
20 | SPECIFIC GOODS AND
SERVICES CONTRACTED FOR. NO | ||||||
21 | ADDITIONAL CHARGES MAY BE REQUIRED.
FOR DESIGNATED | ||||||
22 | GOODS AND SERVICES, ADDITIONAL CHARGES MAY BE INCURRED | ||||||
23 | FOR
UNEXPECTED EXPENSES INCLUDING, BUT NOT LIMITED TO, | ||||||
24 | CASH ADVANCES, SHIPPING OF
REMAINS FROM A DISTANT | ||||||
25 | PLACE, OR DESIGNATED HONORARIA ORDERED OR DIRECTED BY
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26 | SURVIVORS.
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1 | (B) Except as provided in subparagraph (C) of this | ||||||
2 | paragraph (3),
each non-guaranteed price contract | ||||||
3 | shall contain the following
statement in 12 point bold | ||||||
4 | type:
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5 | THIS CONTRACT DOES NOT GUARANTEE THE PRICE THE | ||||||
6 | BENEFICIARY WILL PAY FOR
ANY SPECIFIC GOODS OR | ||||||
7 | SERVICES. ANY FUNDS PAID UNDER THIS CONTRACT ARE ONLY A
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8 | DEPOSIT TO BE APPLIED TOWARD THE FINAL PRICE OF THE | ||||||
9 | GOODS OR SERVICES
CONTRACTED FOR. ADDITIONAL CHARGES | ||||||
10 | MAY BE REQUIRED.
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11 | (C) If a non-guaranteed price contract may
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12 | subsequently become guaranteed, the contract shall | ||||||
13 | clearly
disclose the nature of the guarantee and the | ||||||
14 | time,
occurrence, or event upon which the contract | ||||||
15 | shall become a
guaranteed price contract.
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16 | (4) It provides that if the particular supplies and | ||||||
17 | services specified
in the pre-need contract are | ||||||
18 | unavailable at the time of delivery, the provider
shall be | ||||||
19 | required to furnish supplies and services similar in style | ||||||
20 | and at
least equal in quality of material and workmanship.
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21 | (5) It discloses any penalties or restrictions, | ||||||
22 | including
but not limited
to geographic restrictions or the | ||||||
23 | inability of the provider
to
perform, on the delivery of | ||||||
24 | merchandise, services, or pre-need contract
guarantees.
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25 | (6) Regardless of the method of funding the pre-need | ||||||
26 | contract, the
following must be disclosed:
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1 | (A) Whether the pre-need contract is to be funded | ||||||
2 | by a trust, life
insurance, or an annuity;
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3 | (B) The nature of the relationship among the person
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4 | funding the
pre-need contract, the provider, and the
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5 | seller; and
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6 | (C) The impact on the pre-need contract of (i) any | ||||||
7 | changes in the
funding arrangement including but not | ||||||
8 | limited to changes in the assignment,
beneficiary | ||||||
9 | designation, or use of the funds; (ii) any specific | ||||||
10 | penalties
to be incurred
by the contract purchaser as a | ||||||
11 | result of failure to make payments; (iii)
penalties to | ||||||
12 | be incurred or moneys or refunds to be received as a | ||||||
13 | result of
cancellations; and (iv) all relevant | ||||||
14 | information concerning what occurs and
whether any | ||||||
15 | entitlements or obligations arise if there is a | ||||||
16 | difference between
the proceeds of the particular | ||||||
17 | funding arrangement and the amount actually
needed to | ||||||
18 | pay for the funeral at-need.
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19 | (D) The method of changing the
provider.
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20 | (b) All pre-need contracts are subject to the Federal Trade | ||||||
21 | Commission Rule
concerning the Cooling-Off Period for | ||||||
22 | Door-to-Door Sales (16 CFR Part 429).
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23 | (c) No pre-need contract shall be sold in this State unless
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24 | there is a provider for the services and personal property | ||||||
25 | being
sold. If the seller is not a provider, then the seller | ||||||
26 | must have a binding agreement with a provider, and
the identity |
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1 | of the provider and the nature of the agreement between the | ||||||
2 | seller
and the provider shall be disclosed in the pre-need | ||||||
3 | contract at the time of the
sale and before the receipt of any | ||||||
4 | sales proceeds. The failure to disclose the
identity of the | ||||||
5 | provider, the nature of the agreement between the seller and
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6 | the provider, or any changes thereto to the purchaser and | ||||||
7 | beneficiary, or the
failure to make the disclosures required in | ||||||
8 | subdivision (a)(1), constitutes an
intentional violation of | ||||||
9 | this Act.
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10 | (d) All pre-need contracts must be in writing in at least | ||||||
11 | 11 point type,
numbered, and executed in duplicate. A signed
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12 | copy of the pre-need contract must be provided to the purchaser | ||||||
13 | at the time of
entry into the pre-need contract. The | ||||||
14 | Comptroller may by rule develop
a model pre-need contract form | ||||||
15 | that meets the requirements of this Act.
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16 | (e) The State Comptroller shall by rule develop a booklet | ||||||
17 | for
consumers in plain English describing
the scope, | ||||||
18 | application, and consumer protections of this Act. After the
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19 | adoption of these rules, no pre-need contract shall be sold in | ||||||
20 | this State
unless (i) the seller distributes to the purchaser | ||||||
21 | prior to the sale a
booklet promulgated or approved for use by | ||||||
22 | the State Comptroller; (ii) the
seller explains to the | ||||||
23 | purchaser the terms of the pre-need contract prior to
the | ||||||
24 | purchaser signing; and (iii) the purchaser initials a statement | ||||||
25 | in the
contract confirming that the seller has explained the | ||||||
26 | terms of the contract
prior to the purchaser signing.
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1 | (f) All sales proceeds received in connection with a | ||||||
2 | pre-need
contract shall be deposited into a trust account as | ||||||
3 | provided in
Section 1b and Section 2 of this Act, or shall be | ||||||
4 | used to purchase a life
insurance policy or tax-deferred | ||||||
5 | annuity as provided in Section 2a
of this Act.
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6 | (g) No pre-need contract shall be sold in this State unless | ||||||
7 | it is
accompanied by a funding mechanism permitted under this | ||||||
8 | Act, and unless the
seller is licensed by the Comptroller as | ||||||
9 | provided in Section 3
of this Act.
Nothing in this Act is | ||||||
10 | intended to relieve sellers of pre-need
contracts from
being | ||||||
11 | licensed under any other Act required for their profession or | ||||||
12 | business,
and being subject to the rules promulgated to | ||||||
13 | regulate their profession or
business, including rules on | ||||||
14 | solicitation and advertisement.
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15 | (h) Each pre-need contract entered into under this Section | ||||||
16 | shall be registered on an online database maintained by the | ||||||
17 | State Comptroller. Information to be included in the database | ||||||
18 | shall include, but not be limited to, the name of licensee, | ||||||
19 | purchaser, date of contract, amount of contract, and | ||||||
20 | disposition of the funds. This information must be registered | ||||||
21 | into the State Comptroller's online database within 45 days | ||||||
22 | after the date of the pre-need contract. | ||||||
23 | (Source: P.A. 96-879, eff. 2-2-10.)
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24 | (225 ILCS 45/2) (from Ch. 111 1/2, par. 73.102)
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25 | Sec. 2.
(a) If a purchaser selects a trust arrangement to |
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1 | fund the
pre-need contract, all trust deposits as determined by | ||||||
2 | Section 1b shall be made
within 30 days of receipt.
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3 | (b) A trust established under this Act must be maintained | ||||||
4 | with a corporate fiduciary as defined in Section 1-5.05 of the | ||||||
5 | Corporate Fiduciary Act or with a foreign corporate fiduciary | ||||||
6 | recognized by Article IV of the Corporate Fiduciary Act .
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7 | (c) Trust agreements and amendments to the trust agreements | ||||||
8 | used to
fund a pre-need contract shall be filed with the | ||||||
9 | Comptroller.
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10 | (d) (Blank).
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11 | (e) A seller or provider shall furnish to the trustee and | ||||||
12 | depositary the
name of each payor and the amount of payment on | ||||||
13 | each such account for which
deposit is being so made. Nothing | ||||||
14 | shall prevent the trustee from commingling the
deposits in any | ||||||
15 | such trust fund for purposes of its management and the
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16 | investment of its funds as provided in the Common Trust Fund | ||||||
17 | Act. In addition,
multiple trust funds maintained under this | ||||||
18 | Act may be commingled or commingled
with other funeral or | ||||||
19 | burial related trust funds if all record keeping
requirements | ||||||
20 | imposed by law are met.
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21 | (f) (Blank).
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22 | (g) Upon no less than 30 days prior notice to the | ||||||
23 | Comptroller, the seller may change
the trustee of
the fund. | ||||||
24 | Failure to provide the Comptroller with timely prior notice is | ||||||
25 | an intentional violation of this Act. | ||||||
26 | (h) A trustee shall at least annually furnish to each |
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1 | purchaser a statement containing: (1) the receipts, | ||||||
2 | disbursements, and inventory of the trust, including an | ||||||
3 | explanation of any fees or expenses charged by the trustee | ||||||
4 | under Section 5 of this Act or otherwise, (2) an explanation of | ||||||
5 | the purchaser's right to a refund, if any, under this Act, and | ||||||
6 | (3) identifying the primary regulator of the trust as a | ||||||
7 | corporate fiduciary under state or federal law.
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8 | (Source: P.A. 96-879, eff. 2-2-10.)
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9 | (225 ILCS 45/3) (from Ch. 111 1/2, par. 73.103)
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10 | Sec. 3. Licensing.
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11 | (a) No person, firm, partnership, association or | ||||||
12 | corporation may act as
seller without first securing from the | ||||||
13 | State Comptroller a
license to
so act. Application for such | ||||||
14 | license shall be in writing, signed by the
applicant and duly | ||||||
15 | verified on forms furnished by the Comptroller. Each
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16 | application shall contain at least the following:
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17 | (1) The full name and
address (both residence and place | ||||||
18 | of business) of the applicant, and
every member, officer | ||||||
19 | and director thereof if the applicant is a firm,
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20 | partnership, association, or corporation, and of every | ||||||
21 | shareholder
holding
more than 10% of the corporate stock if | ||||||
22 | the applicant is a corporation;
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23 | (2) A statement of the applicant's
assets and | ||||||
24 | liabilities;
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25 | (3) The name and address of the applicant's principal
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1 | place of business at which the books, accounts, and
records | ||||||
2 | shall be available for examination by the
Comptroller as | ||||||
3 | required by this Act;
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4 | (4) The names and addresses of the applicant's branch
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5 | locations at which pre-need sales shall be conducted and
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6 | which shall operate under the same license number as the
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7 | applicant's principal place of business;
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8 | (5) For each individual listed under item (1) above, a
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9 | detailed statement of the individual's business
experience | ||||||
10 | for the 10 years immediately preceding the
application; any | ||||||
11 | present or prior connection between the
individual and any | ||||||
12 | other person engaged in pre-need
sales; any felony or | ||||||
13 | misdemeanor convictions for which
fraud was an essential | ||||||
14 | element; any charges or
complaints lodged against the | ||||||
15 | individual for which fraud
was an essential element and | ||||||
16 | which resulted in civil or
criminal litigation; any failure | ||||||
17 | of the individual to
satisfy an enforceable judgment | ||||||
18 | entered against him
based upon fraud; and any other | ||||||
19 | information requested by
the Comptroller relating to past | ||||||
20 | business practices of
the individual. Since the | ||||||
21 | information required by this
item (5) may be confidential | ||||||
22 | or contain proprietary
information, this information shall | ||||||
23 | not be available to
other licensees or the general public | ||||||
24 | and shall be used
only for the lawful purposes of the | ||||||
25 | Comptroller in
enforcing this Act;
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26 | (6) The name of the trustee and, if applicable, the
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1 | names of the advisors to the trustee, including a copy
of | ||||||
2 | the proposed trust agreement under which the trust
funds | ||||||
3 | are to be held as required by this Act; and
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4 | (7) Such other information as the Comptroller may
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5 | reasonably require in order to determine the
qualification | ||||||
6 | of the applicant to be licensed under this
Act.
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7 | (b) Applications for
license shall be accompanied
by a | ||||||
8 | fidelity bond executed by the applicant and a surety company
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9 | authorized to do business in this State or an irrevocable, | ||||||
10 | unconditional
letter of credit issued by a bank, credit union, | ||||||
11 | or trust company authorized to
do business in the State of | ||||||
12 | Illinois, as approved by the State Comptroller, in
such amount | ||||||
13 | not exceeding $10,000 as the Comptroller may require. If, after
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14 | notice and an opportunity to be heard, it
has been determined | ||||||
15 | that a licensee has violated this Act within the past 5
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16 | calendar years, the Comptroller may require an additional bond | ||||||
17 | or letter of credit
from the licensee from time to time in | ||||||
18 | amounts equal to one-tenth of such trust
funds, which bond or | ||||||
19 | letter of credit shall run to the Comptroller for the use
and | ||||||
20 | benefit of the beneficiaries of such trust funds.
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21 | The licensee shall keep accurate accounts, books and | ||||||
22 | records in this State,
at the principal place of business | ||||||
23 | identified in the
licensee's license application or as | ||||||
24 | otherwise approved by
the Comptroller in writing,
of
all | ||||||
25 | transactions, copies of all pre-need contracts, trust | ||||||
26 | agreements, and other
agreements, dates and amounts of payments |
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1 | made and accepted thereon, the names
and addresses of the | ||||||
2 | contracting parties, the persons for whose benefit such
funds | ||||||
3 | are accepted, and the names of the depositaries of such funds.
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4 | Each licensee shall maintain the documentation for a period
of | ||||||
5 | 3 years after the licensee has fulfilled his obligations
under | ||||||
6 | the pre-need contract. Additionally, for a period
not to exceed | ||||||
7 | 6 months after the performance of all terms
in a pre-need sales | ||||||
8 | contract, the licensee shall maintain
copies of the contract at | ||||||
9 | the licensee branch location
where the contract was entered or | ||||||
10 | at some other location agreed to by the
Comptroller in writing.
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11 | If an
insurance policy or tax-deferred annuity is used to fund | ||||||
12 | the pre-need contract,
the licensee under this Act shall keep | ||||||
13 | and maintain accurate accounts, books,
and records in this | ||||||
14 | State, at the principal place of business identified in
the
| ||||||
15 | licensee's application or as otherwise approved by the
| ||||||
16 | Comptroller in writing,
of all insurance policies and | ||||||
17 | tax-deferred annuities
used to fund the pre-need contract, the | ||||||
18 | name and address of insured, annuitant,
and initial | ||||||
19 | beneficiary, and the name and address of the insurance company
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20 | issuing the policy or annuity. If a life insurance policy or | ||||||
21 | tax-deferred
annuity is used to fund a pre-need contract, the | ||||||
22 | licensee shall notify the
insurance company of the name of each | ||||||
23 | pre-need contract purchaser and the
amount of each payment when | ||||||
24 | the pre-need contract, insurance policy or annuity
is | ||||||
25 | purchased.
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26 | The licensee shall make reports to the Comptroller annually |
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1 | or at such other
time as the Comptroller may require, on forms | ||||||
2 | furnished by the Comptroller. The
licensee shall file the | ||||||
3 | annual report with the Comptroller within 75 days after
the end | ||||||
4 | of the licensee's fiscal year. The Comptroller shall for good | ||||||
5 | cause
shown grant an extension for the filing of the annual | ||||||
6 | report upon the written
request of the licensee. Such extension | ||||||
7 | shall not exceed 60 days. If a
licensee fails to submit an | ||||||
8 | annual report to the Comptroller within the time
specified in | ||||||
9 | this Section, the Comptroller shall impose upon the licensee a
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10 | penalty of $5 per day for the first 15 days past due, $10 per | ||||||
11 | day for 16 through 30 days past due, $15 per day for 31 through | ||||||
12 | 45 days past due, and $20 per day for the 46th day and every day | ||||||
13 | thereafter for each and every day the licensee remains | ||||||
14 | delinquent in
submitting the annual report. The Comptroller may | ||||||
15 | abate all or part of the
$5 daily penalty for good cause shown. | ||||||
16 | Every application shall be
accompanied by a check
or money | ||||||
17 | order in the amount of $25 and every report shall be | ||||||
18 | accompanied by a
check or money order in the amount of $10 | ||||||
19 | payable to: Comptroller, State of
Illinois.
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20 | The licensee shall make all required books and records | ||||||
21 | pertaining to trust
funds, insurance policies, or tax-deferred | ||||||
22 | annuities available to the
Comptroller for examination. The | ||||||
23 | Comptroller, or a person designated by the
Comptroller who is | ||||||
24 | trained to perform such examinations, may at any time
| ||||||
25 | investigate the books, records and accounts of the licensee | ||||||
26 | with respect to
trust funds, insurance policies, or |
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| |||||||
1 | tax-deferred annuities and for that purpose
may require the | ||||||
2 | attendance of and examine under oath all persons whose
| ||||||
3 | testimony he may require. The licensee shall pay a fee for such | ||||||
4 | examination in
accordance with a schedule established by the | ||||||
5 | Comptroller. The fee shall not
exceed the cost of such | ||||||
6 | examination. For pre-need contracts funded by trust
| ||||||
7 | arrangements, the cost of an initial examination shall be borne | ||||||
8 | by the
licensee if it
has $10,000 or more in trust funds, | ||||||
9 | otherwise, by the Comptroller. The charge
made by the | ||||||
10 | Comptroller for an examination shall be based upon the total | ||||||
11 | amount
of trust funds held by the licensee at the end of the | ||||||
12 | calendar or fiscal year
for which the report is required by | ||||||
13 | this Act and shall be in accordance with
the following | ||||||
14 | schedule:
| ||||||
15 | Less than $10,000 .................................no charge;
| ||||||
16 | $10,000 or more but less than $50,000 ...................$10;
| ||||||
17 | $50,000 or more but less than $100,000 ..................$40;
| ||||||
18 | $100,000 or more but less than $250,000 .................$80;
| ||||||
19 | $250,000 or more ........................................$100.
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20 | The Comptroller may order additional audits or | ||||||
21 | examinations as he or she
may deem necessary or advisable to | ||||||
22 | ensure the safety and stability of the trust
funds and to | ||||||
23 | ensure compliance with this Act. These additional audits or
| ||||||
24 | examinations shall only be made after good cause is established | ||||||
25 | by the
Comptroller in the written order. The grounds for | ||||||
26 | ordering these additional
audits or examinations may include, |
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| |||||||
1 | but shall not be limited to:
| ||||||
2 | (1) material and unverified changes or fluctuations in | ||||||
3 | trust balances or
insurance or annuity policy amounts;
| ||||||
4 | (2) the licensee changing trustees more than twice in | ||||||
5 | any 12-month
period;
| ||||||
6 | (3) any withdrawals or attempted withdrawals from the | ||||||
7 | trusts, insurance
policies, or annuity contracts in | ||||||
8 | violation of this Act; or
| ||||||
9 | (4) failure to maintain or produce documentation | ||||||
10 | required by this Act for
deposits into trust accounts, | ||||||
11 | trust investment activities, or life insurance or
annuity | ||||||
12 | policies.
| ||||||
13 | The
licensee shall bear the full cost of that examination | ||||||
14 | or audit, up to a maximum
of $20,000. The
Comptroller may elect | ||||||
15 | to pay for the examination or audit and receive
reimbursement | ||||||
16 | from the licensee. Payment of the costs of the examination or
| ||||||
17 | audit by a licensee shall be a condition of receiving, | ||||||
18 | maintaining, or renewing
a license
under this Act. All moneys | ||||||
19 | received by the Comptroller for examination or
audit fees shall | ||||||
20 | be maintained in a separate account to be known as the
| ||||||
21 | Comptroller's Administrative
Fund. This
Fund, subject to | ||||||
22 | appropriation by the General Assembly, may
be utilized by the | ||||||
23 | Comptroller for
enforcing this Act and other purposes that may | ||||||
24 | be authorized by law.
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25 | For pre-need contracts funded by life insurance or a | ||||||
26 | tax-deferred annuity,
the cost of an examination shall be borne |
| |||||||
| |||||||
1 | by the licensee. The fee
schedule for such examination shall be | ||||||
2 | established in rules promulgated by the
Comptroller. In the | ||||||
3 | event such investigation or other information received by
the | ||||||
4 | Comptroller discloses a substantial violation of the | ||||||
5 | requirements of this
Act, the Comptroller shall revoke the | ||||||
6 | license of such person upon a hearing as
provided in this Act. | ||||||
7 | Such licensee may terminate all further responsibility
for | ||||||
8 | compliance with the requirements of this Act by voluntarily | ||||||
9 | surrendering
the license to the Comptroller, or in the event of | ||||||
10 | its loss, furnishing the
Comptroller with a sworn statement to | ||||||
11 | that effect, which states the licensee's
intention to | ||||||
12 | discontinue acceptance of funds received under pre-need | ||||||
13 | contracts.
Such license or statement must be accompanied by an | ||||||
14 | affidavit that said
licensee has lawfully expended or refunded | ||||||
15 | all funds received under pre-need
contracts, and that the | ||||||
16 | licensee will accept no additional sales proceeds. The
| ||||||
17 | Comptroller shall immediately cancel or revoke said license.
| ||||||
18 | (Source: P.A. 96-879, eff. 2-2-10.)
| ||||||
19 | (225 ILCS 45/3a-5)
| ||||||
20 | Sec. 3a-5. License requirements.
| ||||||
21 | (a) Every license issued by the Comptroller shall state
the | ||||||
22 | number of the license, the business name and address of
the | ||||||
23 | licensee's principal place of business, each branch
location | ||||||
24 | also operating under the license, and the
licensee's parent | ||||||
25 | company, if any. The license shall be
conspicuously posted in |
| |||||||
| |||||||
1 | each place of business operating
under the license. The | ||||||
2 | Comptroller may issue such
additional licenses as may be | ||||||
3 | necessary for licensee branch
locations upon compliance with | ||||||
4 | the provisions of this Act
governing an original issuance of a | ||||||
5 | license for each new
license.
| ||||||
6 | (b) Individual salespersons representing a licensee
shall | ||||||
7 | not be required to obtain licenses in their
individual | ||||||
8 | capacities, but must acknowledge, by affidavit,
that they have | ||||||
9 | been provided with a copy of and have read
this Act. The | ||||||
10 | licensee shall retain copies of the affidavits
of its sellers | ||||||
11 | for its records and shall make the affidavits
available to the | ||||||
12 | Comptroller for examination upon request.
| ||||||
13 | (c) The licensee shall be responsible for the activities
of | ||||||
14 | any person representing the licensee in selling or
offering a | ||||||
15 | pre-need contract for sale.
| ||||||
16 | (d) Any person not selling on behalf of a licensee shall
| ||||||
17 | obtain its own license.
| ||||||
18 | (e) No license shall be transferable or assignable
without | ||||||
19 | the express written consent of the Comptroller. A
transfer of | ||||||
20 | more than 50% of the ownership of any business
licensed | ||||||
21 | hereunder shall be deemed to be an attempted
assignment of the | ||||||
22 | license originally issued to the licensee
for which consent of | ||||||
23 | the Comptroller shall be required.
| ||||||
24 | (f) Every license issued hereunder shall be renewed every 5 | ||||||
25 | years for a renewal fee of $100. The renewal fee shall be | ||||||
26 | deposited into the Comptroller's Administrative Fund remain in |
| |||||||
| |||||||
1 | force
until it has been suspended, surrendered, or revoked in
| ||||||
2 | accordance with this Act . The Comptroller, upon the request
of | ||||||
3 | an interested person or on his own motion, may issue new
| ||||||
4 | licenses to a licensee whose license or licenses have been
| ||||||
5 | revoked, if no factor or condition then exists which would
have | ||||||
6 | warranted the Comptroller to originally refuse the
issuance of | ||||||
7 | such license.
| ||||||
8 | (Source: P.A. 92-419, eff. 1-1-02 .)
| ||||||
9 | Section 10. The Cemetery Oversight Act is amended by | ||||||
10 | changing Sections 15-15, 15-40, and 75-55 as follows: | ||||||
11 | (225 ILCS 411/15-15) | ||||||
12 | (Section scheduled to be repealed on January 1, 2021)
| ||||||
13 | Sec. 15-15. Care funds; deposits; investments. | ||||||
14 | (a) Whenever a cemetery authority accepts care funds, | ||||||
15 | either in connection with the sale or giving away at an imputed | ||||||
16 | value of an interment right, entombment right, or inurnment | ||||||
17 | right, or in pursuance of a contract, or whenever, as a | ||||||
18 | condition precedent to the purchase or acceptance of an | ||||||
19 | interment right, entombment right, or inurnment right, such | ||||||
20 | cemetery authority shall establish a care fund or deposit the | ||||||
21 | funds in an already existing care fund. | ||||||
22 | (b) The cemetery authority shall execute and deliver to the | ||||||
23 | person from whom it received the care funds an instrument in | ||||||
24 | writing that shall specifically state: (i) the nature and |
| |||||||
| |||||||
1 | extent of the care to be furnished and (ii) that such care | ||||||
2 | shall be furnished only in so far as net income derived from | ||||||
3 | the amount deposited in trust will permit (the income from the | ||||||
4 | amount so deposited, less necessary expenditures of | ||||||
5 | administering the trust, shall be deemed the net income). | ||||||
6 | (c) The setting-aside and deposit of care funds shall be | ||||||
7 | made by such cemetery authority no later than 30 days after the | ||||||
8 | close of the month in which the cemetery authority gave away | ||||||
9 | for an imputed value or received the final payment on the | ||||||
10 | purchase price of interment rights, entombment rights, or | ||||||
11 | inurnment rights, or received the final payment for the general | ||||||
12 | or special care of a lot, grave, crypt, or niche or of a family | ||||||
13 | mausoleum, memorial, marker, or monument, and such amounts | ||||||
14 | shall be held by the trustee of the care funds of such cemetery | ||||||
15 | authority in trust and in perpetuity for the specific purposes | ||||||
16 | stated in the written instrument described in subsection (b). | ||||||
17 | For all care funds received by a cemetery authority, except for | ||||||
18 | care funds received by a cemetery authority pursuant to a | ||||||
19 | specific gift, grant, contribution, payment, legacy, or | ||||||
20 | contract that are subject to investment restrictions more | ||||||
21 | restrictive than the investment provisions set forth in this | ||||||
22 | Act, and except for care funds otherwise subject to a trust | ||||||
23 | agreement executed by a person or persons responsible for | ||||||
24 | transferring the specific gift, grant, contribution, payment, | ||||||
25 | or legacy to the cemetery authority that contains investment | ||||||
26 | restrictions more restrictive than the investment provisions |
| |||||||
| |||||||
1 | set forth in this Act, the cemetery authority may, without the | ||||||
2 | necessity of having to obtain prior approval from any court in | ||||||
3 | this State, designate a new trustee in accordance with this Act | ||||||
4 | and invest the care funds in accordance with this Section, | ||||||
5 | notwithstanding any contrary limitation contained in the trust | ||||||
6 | agreement. | ||||||
7 | (d) Any cemetery authority engaged in selling or giving | ||||||
8 | away at an imputed value interment rights, entombment rights, | ||||||
9 | or inurnment rights, in conjunction with the selling or giving | ||||||
10 | away at an imputed value any other merchandise or services not | ||||||
11 | covered by this Act, shall be prohibited from increasing the | ||||||
12 | sales price or imputed value of those items not requiring a | ||||||
13 | care fund deposit under this Act with the purpose of allocating | ||||||
14 | a lesser sales price or imputed value to items that require a | ||||||
15 | care fund deposit. | ||||||
16 | (e) If any sale that requires a deposit to a cemetery | ||||||
17 | authority's care fund is made by a cemetery authority on an | ||||||
18 | installment basis, and the installment contract is factored, | ||||||
19 | discounted, or sold to a third party, then the cemetery | ||||||
20 | authority shall deposit the amount due to the care fund within | ||||||
21 | 30 days after the close of the month in which the installment | ||||||
22 | contract was factored, discounted, or sold. If, subsequent to | ||||||
23 | such deposit, the purchaser defaults on the contract such that | ||||||
24 | no care fund deposit on that contract would have been required, | ||||||
25 | then the cemetery authority may apply the amount deposited as a | ||||||
26 | credit against future required deposits. |
| |||||||
| |||||||
1 | (f) The trust authorized by this Section shall be a single | ||||||
2 | purpose trust fund. In the event of the cemetery authority's | ||||||
3 | bankruptcy, insolvency, or assignment for the benefit of | ||||||
4 | creditors, or an adverse judgment, the trust funds shall not be | ||||||
5 | available to any creditor as assets of the cemetery authority | ||||||
6 | or to pay any expenses of any bankruptcy or similar proceeding, | ||||||
7 | but shall be retained intact to provide for the future | ||||||
8 | maintenance of the cemetery. Except in an action by the | ||||||
9 | Department to revoke a license issued pursuant to this Act and | ||||||
10 | for creation of a receivership as provided in this Act, the | ||||||
11 | trust shall not be subject to judgment, execution, garnishment, | ||||||
12 | attachment, or other seizure by process in bankruptcy or | ||||||
13 | otherwise, nor to sale, pledge, mortgage, or other alienation, | ||||||
14 | and shall not be assignable except as approved by the | ||||||
15 | Comptroller Department .
| ||||||
16 | (Source: P.A. 96-863, eff. 3-1-10.) | ||||||
17 | (225 ILCS 411/15-40) | ||||||
18 | (Section scheduled to be repealed on January 1, 2021)
| ||||||
19 | Sec. 15-40. Trust examinations and audits. | ||||||
20 | (a) The Comptroller Department shall examine at least | ||||||
21 | annually every licensee who holds $250,000 or more in its care | ||||||
22 | funds. For that purpose, the Comptroller Department shall have | ||||||
23 | free access to the office and places of business and to such | ||||||
24 | records of all licensees and of all trustees of the care funds | ||||||
25 | of all licensees as shall relate to the acceptance, use, and |
| |||||||
| |||||||
1 | investment of care funds. The Comptroller Department may | ||||||
2 | require the attendance of and examine under oath all persons | ||||||
3 | whose testimony may be required relative to such business. In | ||||||
4 | such cases the Comptroller Department , or any qualified | ||||||
5 | representative of the Comptroller Department whom the | ||||||
6 | Comptroller Department may designate, may administer oaths to | ||||||
7 | all such persons called as witnesses, and the Comptroller | ||||||
8 | Department , or any such qualified representative of the | ||||||
9 | Comptroller Department , may conduct such examinations. The | ||||||
10 | cost of an initial examination shall be determined by rule. | ||||||
11 | (b) The Comptroller Department may order additional audits | ||||||
12 | or examinations as it may deem necessary or advisable to ensure | ||||||
13 | the safety and stability of the trust funds and to ensure | ||||||
14 | compliance with this Act. These additional audits or | ||||||
15 | examinations shall only be made after good cause is established | ||||||
16 | by the Comptroller Department in the written order. The grounds | ||||||
17 | for ordering these additional audits or examinations may | ||||||
18 | include, but shall not be limited to:
| ||||||
19 | (1) material and unverified changes or fluctuations in | ||||||
20 | trust balances; | ||||||
21 | (2) the licensee changing trustees more than twice in | ||||||
22 | any 12-month period; | ||||||
23 | (3) any withdrawals or attempted withdrawals from the | ||||||
24 | trusts in violation of this Act; or | ||||||
25 | (4) failure to maintain or produce documentation | ||||||
26 | required by this Act.
|
| |||||||
| |||||||
1 | (Source: P.A. 96-863, eff. 3-1-10.) | ||||||
2 | (225 ILCS 411/75-55) | ||||||
3 | (Section scheduled to be repealed on January 1, 2021)
| ||||||
4 | Sec. 75-55. Transition.
| ||||||
5 | (a) Within 60 days after the effective date of this Act, | ||||||
6 | the Comptroller shall provide the Department copies of records | ||||||
7 | in the Comptroller's possession pertaining to the Cemetery Care | ||||||
8 | Act and the Crematory Regulation Act that are necessary for the | ||||||
9 | Department's immediate responsibilities under this Act. All | ||||||
10 | other records pertaining to the Cemetery Care Act with the | ||||||
11 | exception of records pertaining to care funds and the Crematory | ||||||
12 | Regulation Act shall be transferred to the Department by March | ||||||
13 | 1, 2012. In the case of records that pertain both to the | ||||||
14 | administration of the Cemetery Care Act or the Crematory | ||||||
15 | Regulation Act and to a function retained by the Comptroller, | ||||||
16 | the Comptroller, in consultation with the Department, shall | ||||||
17 | determine, within 60 days after the repeal of the Cemetery Care | ||||||
18 | Act, whether the records shall be transferred, copied, or left | ||||||
19 | with the Comptroller; until this determination has been made | ||||||
20 | the transfer shall not occur . | ||||||
21 | (b) (Blank). A person licensed under one of the Acts listed | ||||||
22 | in subsection (a) of this Section or regulated under the | ||||||
23 | Cemetery Association Act shall continue to comply with the | ||||||
24 | provisions of those Acts until such time as the person is | ||||||
25 | licensed under this Act or those Acts are repealed or the |
| |||||||
| |||||||
1 | amendatory changes made by this amendatory Act of the 96th | ||||||
2 | General Assembly take effect, as the case may be, whichever is | ||||||
3 | earlier. | ||||||
4 | (c) To support the costs that may be associated with | ||||||
5 | implementing and maintaining a licensure and regulatory | ||||||
6 | process for the licensure and regulation of cemetery | ||||||
7 | authorities, cemetery managers, customer service employees, | ||||||
8 | and cemetery workers, all cemetery authorities not maintaining | ||||||
9 | a full exemption or partial exemption shall pay a one-time fee | ||||||
10 | of $20 to the Department plus an additional charge of $1 per | ||||||
11 | burial unit per year within the cemetery. The Department may | ||||||
12 | establish forms for the collection of the fee established under | ||||||
13 | this subsection and shall deposit such fee into the Cemetery | ||||||
14 | Oversight Licensing and Disciplinary Fund. The Department may | ||||||
15 | begin to collect the aforementioned fee after the effective | ||||||
16 | date of this Act. In addition, the Department may establish | ||||||
17 | rules for the collection process, which may include, but shall | ||||||
18 | not be limited to, dates, forms, enforcement, or other | ||||||
19 | procedures necessary for the effective collection, deposit, | ||||||
20 | and
overall process regarding this Section. | ||||||
21 | (d) Any cemetery authority that fails to pay to the | ||||||
22 | Department the required fee or submits the incorrect amount | ||||||
23 | shall be subject to the penalties provided for in Section | ||||||
24 | 25-110 of this Act. | ||||||
25 | (e) Except as otherwise specifically provided, all fees, | ||||||
26 | fines, penalties, or other moneys received or collected |
| |||||||
| |||||||
1 | pursuant to this Act shall be deposited in the Cemetery | ||||||
2 | Oversight Licensing and Disciplinary Fund. | ||||||
3 | (f) (Blank). All proportionate funds held in the | ||||||
4 | Comptroller's Administrative Fund related to unexpended moneys | ||||||
5 | collected under the Cemetery Care Act and the Crematory | ||||||
6 | Regulation Act shall be transferred to the Cemetery Oversight | ||||||
7 | Licensing and Disciplinary Fund within 60 days after the | ||||||
8 | effective date of the repeal of the Cemetery Care Act. | ||||||
9 | (g) (Blank). Personnel employed by the Comptroller on | ||||||
10 | February 29, 2012, to perform the duties pertaining to the | ||||||
11 | administration of the Cemetery Care Act and the Crematory | ||||||
12 | Regulation Act, are transferred to the Department on March 1, | ||||||
13 | 2012. | ||||||
14 | The rights of State employees, the State, and its agencies | ||||||
15 | under the Comptroller Merit Employment Code and applicable | ||||||
16 | collective bargaining agreements and retirement plans are not | ||||||
17 | affected under this Act, except that all positions transferred | ||||||
18 | to the Department shall be subject to the Personnel Code | ||||||
19 | effective March 1, 2012. | ||||||
20 | All transferred employees who are members of collective | ||||||
21 | bargaining units shall retain their seniority, continuous | ||||||
22 | service, salary, and accrued benefits. During the pendency of | ||||||
23 | the existing collective bargaining agreement, the rights | ||||||
24 | provided for under that agreement shall not be abridged. | ||||||
25 | The Department shall continue to honor during their | ||||||
26 | pendency all bargaining agreements in effect at the time of the |
| |||||||
| |||||||
1 | transfer and to recognize all collective bargaining | ||||||
2 | representatives for the employees who perform or will perform | ||||||
3 | functions transferred by this Act. For all purposes with | ||||||
4 | respect to the management of the existing agreement and the | ||||||
5 | negotiation and management of any successor agreements, the | ||||||
6 | Department shall be deemed the employer of employees who | ||||||
7 | perform or will perform functions transferred to the Department | ||||||
8 | by this Act.
| ||||||
9 | (Source: P.A. 96-863, eff. 3-1-10.) | ||||||
10 | Section 15. The Illinois Pre-Need Cemetery Sales Act is | ||||||
11 | amended by changing Sections 6, 8, 14, 15, and 20 as follows:
| ||||||
12 | (815 ILCS 390/6) (from Ch. 21, par. 206)
| ||||||
13 | Sec. 6. License application.
| ||||||
14 | (a) An application for a license shall be made in writing | ||||||
15 | to
the Comptroller on forms prescribed by him or her, signed by | ||||||
16 | the applicant
under oath verified by a notary public,
and | ||||||
17 | accompanied
by a non-returnable $125 $25 application fee , $100 | ||||||
18 | of which shall be deposited into the Comptroller's | ||||||
19 | Administrative Fund . The Comptroller may prescribe
abbreviated | ||||||
20 | application forms for persons holding a license under the | ||||||
21 | Cemetery
Care Act. Applications (except abbreviated | ||||||
22 | applications) must include at least
the following information:
| ||||||
23 | (1) The full name and address, both residence and | ||||||
24 | business, of the
applicant if the applicant is an |
| |||||||
| |||||||
1 | individual; of every member if applicant is
a partnership; | ||||||
2 | of every member of the Board of Directors if applicant is | ||||||
3 | an
association; and of every officer, director and | ||||||
4 | shareholder
holding more
than 10% of the corporate stock if | ||||||
5 | applicant is a corporation;
| ||||||
6 | (2) A detailed statement of applicant's assets and | ||||||
7 | liabilities;
| ||||||
8 | (2.1) The name and address of the applicant's
principal | ||||||
9 | place of business at which the books,
accounts, and records | ||||||
10 | are available for examination
by the Comptroller as | ||||||
11 | required by this Act;
| ||||||
12 | (2.2) The name and address of the applicant's branch
| ||||||
13 | locations at which pre-need sales will be conducted and
| ||||||
14 | which will operate under the same license number as the
| ||||||
15 | applicant's principal place of business;
| ||||||
16 | (3) For each individual listed under (1) above, a | ||||||
17 | detailed statement of
the individual's business experience | ||||||
18 | for the 10 years immediately preceding
the application; any | ||||||
19 | present or prior connection between the individual and
any | ||||||
20 | other person engaged in pre-need sales; any felony or | ||||||
21 | misdemeanor
convictions for which fraud was an essential | ||||||
22 | element; any charges or
complaints lodged against the | ||||||
23 | individual for which fraud was an essential
element and | ||||||
24 | which resulted in civil or criminal litigation; any failure | ||||||
25 | of
the individual to satisfy an enforceable judgment | ||||||
26 | entered against him or
her based
upon fraud;
and any other |
| |||||||
| |||||||
1 | information requested by the Comptroller relating
to the | ||||||
2 | past business practices of the individual. Since the | ||||||
3 | information
required by this paragraph may be confidential | ||||||
4 | or contain proprietary
information, this information shall | ||||||
5 | not be available to other licensees or
the general public | ||||||
6 | and shall be used only for the lawful purposes of the
| ||||||
7 | Comptroller in enforcing this Act;
| ||||||
8 | (4) The name of the trustee and, if applicable, the | ||||||
9 | names of the
advisors to the trustee, including a copy of | ||||||
10 | the proposed trust agreement
under which the trust funds | ||||||
11 | are to be held as required by this Act;
| ||||||
12 | (5) Where applicable, the name of the corporate surety | ||||||
13 | company
providing the performance bond for the | ||||||
14 | construction of undeveloped spaces
and a copy of the bond; | ||||||
15 | and
| ||||||
16 | (6) Such other information as the Comptroller may | ||||||
17 | reasonably require in
order to determine the qualification | ||||||
18 | of the applicant to be licensed under this
Act.
| ||||||
19 | (b) Applications for license shall be accompanied by a | ||||||
20 | fidelity bond
executed by the applicant and a security company | ||||||
21 | authorized to do business
in this State in such amount, not | ||||||
22 | exceeding $10,000, as the Comptroller may
require. The | ||||||
23 | Comptroller may require additional bond from time to time in
| ||||||
24 | amounts equal to one-tenth of such trust funds but not to | ||||||
25 | exceed $100,000,
which bond shall run to the Comptroller for | ||||||
26 | the use and benefit of the
beneficiaries of such trust funds. |
| |||||||
| |||||||
1 | Such licensee may by written permit of
the Comptroller be | ||||||
2 | authorized to operate without additional bond, except
such | ||||||
3 | fidelity bond as may be required by the Comptroller for the | ||||||
4 | protection
of the licensee against loss by default by any of | ||||||
5 | its employees engaged in
the handling of trust funds.
| ||||||
6 | (c) Any application not acted upon within 90 days may be | ||||||
7 | deemed denied.
| ||||||
8 | (Source: P.A. 92-419, eff. 1-1-02.)
| ||||||
9 | (815 ILCS 390/8) (from Ch. 21, par. 208)
| ||||||
10 | Sec. 8.
(a) Every license issued by the Comptroller shall | ||||||
11 | state the
number of the license, the business name and address | ||||||
12 | of the licensee's
principal place of business, each branch | ||||||
13 | location also operating under the
license, and the licensee's | ||||||
14 | parent company, if any. The license shall be
conspicuously | ||||||
15 | posted in
each place of business operating under the license. | ||||||
16 | The Comptroller may issue
additional licenses as may be | ||||||
17 | necessary for license branch locations upon compliance with the | ||||||
18 | provisions of this Act
governing an original issuance of a | ||||||
19 | license for each new license.
| ||||||
20 | (b) Individual salespersons representing a licensee
shall | ||||||
21 | not be required
to obtain licenses in their individual | ||||||
22 | capacities
but must acknowledge, by affidavit, that they have
| ||||||
23 | been provided a copy of and have read this Act. The licensee | ||||||
24 | must
retain copies of the affidavits of its salespersons for | ||||||
25 | its
records and must make the affidavits available to the
|
| |||||||
| |||||||
1 | Comptroller for examination upon request.
| ||||||
2 | (c) The licensee shall be responsible for the activities of | ||||||
3 | any person
representing the licensee in selling or offering a | ||||||
4 | pre-need contract for sale.
| ||||||
5 | (d) Any person not selling on behalf of a
licensee
shall be | ||||||
6 | required to obtain his or her own license.
| ||||||
7 | (e) Any person engaged in pre-need sales, as defined | ||||||
8 | herein, prior to
the effective date of this Act may continue | ||||||
9 | operations until the application
for license under this Act is | ||||||
10 | denied; provided that such person shall make
application for a | ||||||
11 | license within 60 days of the date that application forms
are | ||||||
12 | made available by the Comptroller.
| ||||||
13 | (f) No license shall be transferable or assignable without | ||||||
14 | the express
written consent of the Comptroller. A transfer of | ||||||
15 | more than 50% of the
ownership of any business licensed | ||||||
16 | hereunder shall be deemed to be an attempted
assignment of the | ||||||
17 | license originally issued to the licensee for which consent
of | ||||||
18 | the Comptroller shall be required.
| ||||||
19 | (g) Every license issued hereunder shall be renewed every 5 | ||||||
20 | years for a fee of $100. The renewal fee shall be deposited | ||||||
21 | into the Comptroller's Administrative Fund. The remain in force | ||||||
22 | until the same
has been suspended, surrendered or revoked in | ||||||
23 | accordance with this Act,
but the Comptroller, upon the request | ||||||
24 | of an interested person or on his
own motion, may issue new | ||||||
25 | licenses to a licensee whose license or licenses
have been | ||||||
26 | revoked, if no factor or condition then exists which would have
|
| |||||||
| |||||||
1 | warranted the Comptroller in refusing originally the issuance | ||||||
2 | of such license.
| ||||||
3 | (Source: P.A. 92-419, eff. 1-1-02.)
| ||||||
4 | (815 ILCS 390/14) (from Ch. 21, par. 214)
| ||||||
5 | Sec. 14. Contract required.
| ||||||
6 | (a) It is unlawful for any person doing business within | ||||||
7 | this
State to accept sales proceeds, either directly or | ||||||
8 | indirectly, by any
means unless the seller enters into a | ||||||
9 | pre-need sales
contract
with the
purchaser which meets the | ||||||
10 | following requirements:
| ||||||
11 | (1) A written sales contract shall be executed in at | ||||||
12 | least 11 point
type in duplicate for
each pre-need sale | ||||||
13 | made by a licensee, and a signed copy given to the
| ||||||
14 | purchaser. Each completed contract shall be numbered and | ||||||
15 | shall contain: (i)
the
name and address of the purchaser, | ||||||
16 | the principal office
of the licensee, and the parent | ||||||
17 | company of the licensee; (ii) the name
of the person,
if | ||||||
18 | known, who
is to receive the cemetery merchandise, cemetery | ||||||
19 | services or the
completed interment, entombment or | ||||||
20 | inurnment spaces under the contract; and
(iii) specific | ||||||
21 | identification of such
merchandise, services or spaces to | ||||||
22 | be provided, if a specific space or spaces
are contracted | ||||||
23 | for, and
the price of the merchandise, services, or space | ||||||
24 | or spaces.
| ||||||
25 | (2) In addition,
such contracts must contain a |
| |||||||
| |||||||
1 | provision in distinguishing typeface as follows:
| ||||||
2 | "Notwithstanding anything in this contract to the | ||||||
3 | contrary, you are
afforded certain specific rights of | ||||||
4 | cancellation and refund under the Illinois Pre-Need | ||||||
5 | Cemetery Sales Act, enacted by the 84th
General Assembly of | ||||||
6 | the State of Illinois".
| ||||||
7 | (3) All pre-need sales contracts shall be sold on a | ||||||
8 | guaranteed price
basis.
At the time of performance of the | ||||||
9 | service or delivery of the merchandise,
the seller shall be | ||||||
10 | prohibited from assessing the purchaser or
his heirs or
| ||||||
11 | assigns or duly authorized representative any additional | ||||||
12 | charges for the
specific merchandise and services listed on | ||||||
13 | the pre-need sales contract.
| ||||||
14 | (4) Each contract shall clearly disclose that the price | ||||||
15 | of the
merchandise or services is guaranteed and shall | ||||||
16 | contain the following
statement in 12 point bold type:
| ||||||
17 | "THIS CONTRACT GUARANTEES THE BENEFICIARY THE SPECIFIC | ||||||
18 | GOODS,
SERVICES, INTERMENT SPACES, ENTOMBMENT SPACES, AND | ||||||
19 | INURNMENT SPACES
CONTRACTED FOR. NO ADDITIONAL CHARGES MAY | ||||||
20 | BE REQUIRED FOR
DESIGNATED GOODS, SERVICES, AND SPACES. | ||||||
21 | ADDITIONAL CHARGES MAY
BE INCURRED FOR
UNEXPECTED | ||||||
22 | EXPENSES."
| ||||||
23 | (5) The pre-need sales contract shall provide that
if | ||||||
24 | the particular cemetery services, cemetery
merchandise, or | ||||||
25 | spaces specified in the pre-need
contract are unavailable | ||||||
26 | at the time of delivery, the
seller shall be required to |
| |||||||
| |||||||
1 | furnish services,
merchandise, and spaces similar in style | ||||||
2 | and at least
equal in quality of material and workmanship.
| ||||||
3 | (6) The pre-need contract shall also disclose any
| ||||||
4 | specific penalties to be incurred by the purchaser as a
| ||||||
5 | result of failure to make payments; and penalties to be
| ||||||
6 | incurred or moneys or refunds to be received as a result
of | ||||||
7 | cancellation of the contract.
| ||||||
8 | (7) The pre-need contract shall disclose the nature
of | ||||||
9 | the relationship between the provider and the seller.
| ||||||
10 | (8) Each pre-need contract that authorizes the | ||||||
11 | delivery
of cemetery merchandise to a licensed and bonded | ||||||
12 | warehouse
shall provide that prior to or upon delivery of | ||||||
13 | the
merchandise to the warehouse
the title to the | ||||||
14 | merchandise and a warehouse receipt shall
be delivered to | ||||||
15 | the purchaser or beneficiary. The pre-need
contract shall | ||||||
16 | contain the following statement in 12 point
bold type:
| ||||||
17 | "THIS CONTRACT AUTHORIZES THE DELIVERY OF MERCHANDISE TO
A | ||||||
18 | LICENSED AND BONDED WAREHOUSE FOR STORAGE OF THE
| ||||||
19 | MERCHANDISE UNTIL THE MERCHANDISE IS NEEDED BY THE
| ||||||
20 | BENEFICIARY. DELIVERY OF THE MERCHANDISE IN THIS MANNER MAY
| ||||||
21 | PRECLUDE REFUND OF SALE PROCEEDS THAT ARE ATTRIBUTABLE TO
| ||||||
22 | THE DELIVERED MERCHANDISE."
| ||||||
23 | The purchaser shall initial the statement at the time | ||||||
24 | of
entry into the pre-need contract.
| ||||||
25 | (9) Each pre-need contract that authorizes the | ||||||
26 | placement
of cemetery merchandise at the site of its
|
| |||||||
| |||||||
1 | ultimate use prior to the time that the merchandise is | ||||||
2 | needed
by the beneficiary shall contain the following | ||||||
3 | statement in
12 point bold type:
| ||||||
4 | "THIS CONTRACT AUTHORIZES THE PLACEMENT OF MERCHANDISE
AT | ||||||
5 | THE SITE OF ITS ULTIMATE USE PRIOR TO THE TIME THAT THE
| ||||||
6 | MERCHANDISE IS NEEDED BY THE BENEFICIARY. DELIVERY OF THE
| ||||||
7 | MERCHANDISE IN THIS MANNER MAY PRECLUDE REFUND OF SALE
| ||||||
8 | PROCEEDS THAT ARE ATTRIBUTABLE TO THE DELIVERED
| ||||||
9 | MERCHANDISE."
| ||||||
10 | The purchaser shall initial the statement at the time | ||||||
11 | of
entry into the pre-need contract.
| ||||||
12 | (10) Each pre-need contract that is funded by a trust | ||||||
13 | shall clearly identify the trustee's name and address and | ||||||
14 | the primary state or federal regulator of the trustee as a | ||||||
15 | corporate fiduciary. | ||||||
16 | (b) Every pre-need sales contract must be in writing.
The | ||||||
17 | Comptroller may by rule
develop a model pre-need sales contract | ||||||
18 | form that meets the requirements
of this Act.
| ||||||
19 | (c) To the extent the Rule is applicable, every pre-need | ||||||
20 | sales
contract is subject to the Federal Trade Commission Rule | ||||||
21 | concerning the
Cooling-Off Period for Door-to-Door Sales (16 | ||||||
22 | CFR Part 429).
| ||||||
23 | (d) No pre-need sales contract may be entered into in
this | ||||||
24 | State unless there is a provider for the cemetery
merchandise, | ||||||
25 | cemetery services, and undeveloped interment,
inurnment, and | ||||||
26 | entombment spaces being sold. If the seller
is not the |
| |||||||
| |||||||
1 | provider, then the seller must have a binding
agreement with a | ||||||
2 | provider, and the identity of the provider
and the nature of | ||||||
3 | the agreement between the seller and the
provider must be | ||||||
4 | disclosed in the pre-need sales contract
at the time of sale | ||||||
5 | and before the receipt of any sale
proceeds. The failure to | ||||||
6 | disclose the identity of the
provider, the nature of the | ||||||
7 | agreement between the seller
and the provider, or any changes | ||||||
8 | thereto to the purchaser
and beneficiary, or the failure to | ||||||
9 | make the disclosures
required by this Section constitutes an | ||||||
10 | intentional
violation of this Act.
| ||||||
11 | (e) No pre-need contract may be entered into in this
State | ||||||
12 | unless it is accompanied by a funding mechanism
permitted under | ||||||
13 | this Act and unless the seller is
licensed by the Comptroller | ||||||
14 | as provided in this Act.
Nothing in this Act is intended to | ||||||
15 | relieve providers or
sellers of pre-need contracts from being | ||||||
16 | licensed under any
other Act required for their profession or | ||||||
17 | business or from
being subject to the rules promulgated to | ||||||
18 | regulate their
profession or business, including rules on | ||||||
19 | solicitation and
advertisement.
| ||||||
20 | (f) No pre-need contract may be entered into in this
State | ||||||
21 | unless the seller explains to the
purchaser the terms of the | ||||||
22 | pre-need contract prior to the
purchaser signing and the | ||||||
23 | purchaser initials a statement in the contract
confirming that | ||||||
24 | the seller has explained the terms of the contract prior to the
| ||||||
25 | purchaser signing.
| ||||||
26 | (g) The State Comptroller shall develop a booklet for
|
| |||||||
| |||||||
1 | consumers in plain English describing the scope,
application, | ||||||
2 | and consumer protections of this Act. After
the booklet is | ||||||
3 | developed, no pre-need contract may be
sold in this State | ||||||
4 | unless the seller
distributes to the purchaser prior to the | ||||||
5 | sale a booklet
developed or approved for use by the State | ||||||
6 | Comptroller.
| ||||||
7 | (h) Each pre-need contract entered into under this Section | ||||||
8 | shall be registered on an online database maintained by the | ||||||
9 | State Comptroller. Information to be included in the database | ||||||
10 | shall include, but not be limited to, the name of licensee, | ||||||
11 | purchaser, date of contract, amount of contract, and | ||||||
12 | disposition of the funds. This information must be registered | ||||||
13 | into the State Comptroller's online database within 45 days | ||||||
14 | after the date of the pre-need contract. | ||||||
15 | (Source: P.A. 96-879, eff. 2-2-10.)
| ||||||
16 | (815 ILCS 390/15) (from Ch. 21, par. 215)
| ||||||
17 | Sec. 15.
(a) Whenever a seller receives anything of value | ||||||
18 | under a
pre-need sales contract, the person receiving such | ||||||
19 | value shall deposit 50%
of all proceeds received into one or | ||||||
20 | more trust funds maintained pursuant
to this Section, except | ||||||
21 | that, in the case of proceeds received for the
purchase of | ||||||
22 | outer burial containers, 85% of the proceeds shall be deposited
| ||||||
23 | into one or more trust funds. Such deposits shall be made until | ||||||
24 | the amount
deposited in
trust equals 50% of the sales price of | ||||||
25 | the cemetery merchandise, cemetery
services and undeveloped |
| |||||||
| |||||||
1 | spaces included in such contract, except that, in
the case of | ||||||
2 | deposits for outer burial containers, deposits shall be made | ||||||
3 | until
the amount deposited in trust equals 85% of the sales | ||||||
4 | price. In the event
an
installment contract is factored, | ||||||
5 | discounted or sold to a third party, the
seller shall deposit | ||||||
6 | an amount equal to 50% of the sales price of the
installment | ||||||
7 | contract, except that, for the portion of the contract
| ||||||
8 | attributable to the sale of outer burial containers, the seller | ||||||
9 | shall deposit
an amount equal to 85% of the sales price. | ||||||
10 | Proceeds required to be deposited
in trust which
are
| ||||||
11 | attributable to cemetery merchandise and cemetery services | ||||||
12 | shall be held
in a "Cemetery Merchandise Trust Fund". Proceeds | ||||||
13 | required to be deposited
in trust which are attributable to the | ||||||
14 | sale of undeveloped interment,
entombment or inurnment spaces | ||||||
15 | shall be held in a "Pre-construction Trust
Fund". If | ||||||
16 | merchandise is delivered for storage in a bonded warehouse, as
| ||||||
17 | authorized herein, and payment of transportation or other | ||||||
18 | charges totaling
more than $20 will be required in order to | ||||||
19 | secure delivery to the site of
ultimate use, upon such delivery | ||||||
20 | to the warehouse the seller shall deposit
to the trust fund the | ||||||
21 | full amount of the actual or estimated transportation
charge. | ||||||
22 | Transportation charges which have been prepaid by the seller
| ||||||
23 | shall not be deposited to trust funds maintained pursuant to | ||||||
24 | this Section.
As used in this Section, "all proceeds" means the | ||||||
25 | entire amount paid by a
purchaser in connection with a pre-need | ||||||
26 | sales contract, including finance
charges and Cemetery Care Act |
| |||||||
| |||||||
1 | contributions, but excluding sales taxes
and credit life | ||||||
2 | insurance premiums.
| ||||||
3 | (b) The seller shall act as trustee of all amounts received | ||||||
4 | for cemetery merchandise, services, or undeveloped spaces | ||||||
5 | until those amounts have been deposited into the trust fund. | ||||||
6 | All trust deposits required by this Act shall be made within 30 | ||||||
7 | days
following the end of the month of receipt. The seller must | ||||||
8 | retain a corporate fiduciary as an independent trustee for any | ||||||
9 | amount of trust funds. Upon 30 days' prior written notice from | ||||||
10 | the seller to the Comptroller, the seller may change the | ||||||
11 | trustee of the trust fund. Failure to provide the Comptroller | ||||||
12 | with timely prior notice is an intentional violation of this | ||||||
13 | Act.
| ||||||
14 | (c) A trust established under this Act must be maintained | ||||||
15 | with a corporate fiduciary as defined in Section 1-5.05 of the | ||||||
16 | Corporate Fiduciary Act or with a foreign corporate fiduciary | ||||||
17 | recognized by Article IV of the Corporate Fiduciary Act .
| ||||||
18 | (d) Funds deposited in the trust account shall be | ||||||
19 | identified in the records
of the seller by the name of the | ||||||
20 | purchaser. Nothing shall prevent the trustee
from commingling | ||||||
21 | the deposits in any such trust fund for purposes of the
| ||||||
22 | management thereof and the investment of funds therein as | ||||||
23 | provided in the
"Common Trust Fund Act", approved June 24, | ||||||
24 | 1949, as amended. In addition,
multiple trust funds maintained | ||||||
25 | pursuant to this Act may be commingled or
commingled with other | ||||||
26 | funeral or burial related trust funds, provided that
all record |
| |||||||
| |||||||
1 | keeping requirements imposed by or pursuant to law are met.
| ||||||
2 | (e) In lieu of a pre-construction trust fund, a seller of | ||||||
3 | undeveloped
interment, entombment or inurnment spaces may | ||||||
4 | obtain and file with the
Comptroller a performance bond in an | ||||||
5 | amount at least equal to 50% of the
sales price of the | ||||||
6 | undeveloped spaces or the estimated cost of completing
| ||||||
7 | construction, whichever is greater. The bond shall be | ||||||
8 | conditioned on the
satisfactory construction and completion of | ||||||
9 | the undeveloped spaces as
required in Section 19 of this Act.
| ||||||
10 | Each bond obtained under this Section shall have as surety | ||||||
11 | thereon a
corporate surety company incorporated under the laws | ||||||
12 | of the United States,
or a State, the District of Columbia or a | ||||||
13 | territory or possession of the
United States. Each such | ||||||
14 | corporate surety company must be authorized to
provide | ||||||
15 | performance bonds as required by this Section, have paid-up
| ||||||
16 | capital of at least $250,000 in cash or its equivalent and be | ||||||
17 | able to carry
out its contracts. Each pre-need seller must | ||||||
18 | provide to the Comptroller,
for each corporate surety company | ||||||
19 | such
seller utilizes, a statement of assets and liabilities of | ||||||
20 | the corporate
surety company sworn to by the president and | ||||||
21 | secretary
of the corporation by January 1 of each year.
| ||||||
22 | The Comptroller shall prohibit pre-need sellers from doing | ||||||
23 | new business
with a corporate surety company if the company is | ||||||
24 | insolvent or is in
violation of this Section. In addition the | ||||||
25 | Comptroller may direct a
pre-need seller to reinstate a | ||||||
26 | pre-construction trust fund upon the
Comptroller's |
| |||||||
| |||||||
1 | determination that the corporate surety company no longer is
| ||||||
2 | sufficient security.
| ||||||
3 | All performance bonds issued pursuant to this Section must | ||||||
4 | be irrevocable
during the statutory term for completing | ||||||
5 | construction specified in Section
19 of this Act, unless | ||||||
6 | terminated sooner by the completion of construction.
| ||||||
7 | (f) Whenever any pre-need contract shall be entered into | ||||||
8 | and include 1)
items of cemetery merchandise and cemetery | ||||||
9 | services, and 2) rights to
interment, inurnment or entombment | ||||||
10 | in completed spaces without allocation
of the gross sale price | ||||||
11 | among the items sold, the application of payments
received | ||||||
12 | under the contract shall be allocated, first to the right to
| ||||||
13 | interment, inurnment or entombment, second to items of cemetery | ||||||
14 | merchandise
and cemetery services, unless some other | ||||||
15 | allocation is clearly provided
in the contract.
| ||||||
16 | (g) Any person engaging in pre-need sales who enters into a | ||||||
17 | combination
sale which involves the sale of items covered by a | ||||||
18 | trust or performance
bond requirement and any item not covered | ||||||
19 | by any entrustment or bond
requirement, shall be prohibited | ||||||
20 | from increasing the gross sales price of
those items not | ||||||
21 | requiring entrustment with the purpose of allocating a
lesser | ||||||
22 | gross sales price to items which require a trust deposit or a
| ||||||
23 | performance bond.
| ||||||
24 | (Source: P.A. 96-879, eff. 2-2-10.)
| ||||||
25 | (815 ILCS 390/20) (from Ch. 21, par. 220)
|
| |||||||
| |||||||
1 | Sec. 20. Records.
| ||||||
2 | (a) Each licensee must keep accurate accounts, books and
| ||||||
3 | records in this State
at the principal place of business | ||||||
4 | identified in the
licensee's license application or as | ||||||
5 | otherwise approved by
the Comptroller in writing
of all | ||||||
6 | transactions, copies of agreements, dates and
amounts of | ||||||
7 | payments made or received, the names and addresses of the
| ||||||
8 | contracting parties, the names and addresses of persons for | ||||||
9 | whose benefit
funds are received, if known, and the names of | ||||||
10 | the trust depositories.
Additionally, for a period not to | ||||||
11 | exceed 6 months after
the performance of all terms in a | ||||||
12 | pre-need sales contract,
the licensee shall maintain copies of | ||||||
13 | each pre-need
contract at the licensee branch location where | ||||||
14 | the contract
was entered or at some other location agreed to by | ||||||
15 | the Comptroller in
writing.
| ||||||
16 | (b) Each licensee must maintain such records for a period | ||||||
17 | of 3
years
after the licensee shall have fulfilled his or her | ||||||
18 | obligation
under the pre-need
contract or 3 years after any | ||||||
19 | stored merchandise shall have been provided
to the purchaser or | ||||||
20 | beneficiary, whichever is later.
| ||||||
21 | (c) Each licensee shall submit reports to the Comptroller
| ||||||
22 | annually,
under oath, on forms furnished by the Comptroller. | ||||||
23 | The annual report
shall
contain, but shall not be limited to, | ||||||
24 | the following:
| ||||||
25 | (1) An accounting of the principal deposit and | ||||||
26 | additions of principal
during the fiscal year.
|
| |||||||
| |||||||
1 | (2) An accounting of any withdrawal of principal or | ||||||
2 | earnings.
| ||||||
3 | (3) An accounting at the end of each fiscal year, of | ||||||
4 | the total amount of
principal and earnings held.
| ||||||
5 | (d) The annual report shall be filed by the licensee with | ||||||
6 | the
Comptroller within 75 days after the end of the licensee's | ||||||
7 | fiscal year. An
extension of up to 60 days may be granted by | ||||||
8 | the Comptroller, upon a
showing of need by the licensee. Any | ||||||
9 | other reports shall be in
the form
furnished or specified by | ||||||
10 | the Comptroller. If a licensee fails to submit an
annual report | ||||||
11 | to the Comptroller within the time specified in this Section, | ||||||
12 | the
Comptroller shall impose upon the licensee a penalty of $5 | ||||||
13 | per day for the first 15 days past due, $10 per day for 16 | ||||||
14 | through 30 days past due, $15 per day for 31 through 45 days | ||||||
15 | past due, and $20 per day for the 46th day and every day | ||||||
16 | thereafter for
each and every
day the licensee remains | ||||||
17 | delinquent in submitting the annual report. The
Comptroller may | ||||||
18 | abate all or part of the $5 daily penalty for good cause
shown. | ||||||
19 | Each
report shall be accompanied by a check or money order in | ||||||
20 | the
amount of $10
payable to: Comptroller, State of Illinois.
| ||||||
21 | (e) On and after the effective date of this amendatory Act | ||||||
22 | of the 91st
General Assembly, a licensee may
report all | ||||||
23 | required information concerning the sale of outer burial | ||||||
24 | containers
on the licensee's annual report required to be filed | ||||||
25 | under this Act and
shall
not be required to report that | ||||||
26 | information under the Illinois Funeral or
Burial
Funds Act, as |
| |||||||
| |||||||
1 | long as the information is reported under this Act.
| ||||||
2 | (Source: P.A. 91-7, eff. 1-1-00; 92-419, eff. 1-1-02.)
| ||||||
3 | Section 99. Effective date. This Act takes effect upon | ||||||
4 | becoming law.".
|