Illinois General Assembly - Full Text of SB3752
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Full Text of SB3752  97th General Assembly




State of Illinois
2011 and 2012


Introduced 2/10/2012, by Sen. Emil Jones, III


New Act
815 ILCS 315/Act rep.
815 ILCS 122/1-15
815 ILCS 505/2Z  from Ch. 121 1/2, par. 262Z

    Repeals the Check Cashing Act and creates the Check Cashers Act. Contains a statement of purpose. Defines "merchant" as a person, firm, association, partnership, or corporation primarily engaged in the business of selling tangible personal property at retail, and defines other terms. Provides that a merchant may engage in the check cashing business for a fee only if it is incidental to the merchant's main business. Contains provisions concerning applicability, permitted fees, proceeds, deposits, reporting requirements, forged checks, records, enforcement and remedies, judicial review, and waivers. Provides that the Department may make and enforce such reasonable rules, regulations, directions, orders, decisions, and findings as the execution and enforcement of the Act require. Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that any person who knowingly violates the Check Cashers Act commits an unlawful practice under the Consumer Fraud and Deceptive Business Practices Act. Makes conforming changes in the Payday Loan Reform Act. Contains a severability provision. Effective 180 days after becoming law.

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1    AN ACT concerning business.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 1. Short title. This Act may be cited as the Check
5Cashers Act.
6    Section 5. Purpose. The purpose of this Act is to protect
7consumers who cash checks at retail businesses that provide
8check cashing services. This Act shall be construed as a
9consumer protection law for all purposes. This Act shall be
10liberally construed to effectuate its purpose.
11    Section 10. Definitions. As used in this Act:
12    "Cash" means legal tender of the United States.
13    "Check" means a check, draft, money order, traveler's
14check, or negotiable instrument as defined by Article 3 of the
15Uniform Commercial Code.
16    "Check casher" means a merchant, including any affiliate or
17subsidiary of a merchant that engages in the check cashing
19    "Check cashing business" means the business of converting
20checks, drafts, money orders, traveler's checks, or other
21payment instruments to cash for a fee. "Check cashing business"
22does not include any transaction where a customer presents a



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1check for the exact amount of any purchase.
2    "Consumer" means any natural person who, singly or jointly
3with another consumer, cashes a check.
4    "Department" means the Department of Financial and
5Professional Regulation.
6    "Incidental" means that in the course of a merchant's
7business, at each location, the merchant's check fee income is
8less than 20% of gross sales.
9    "Location" means a place of business at which activity
10regulated by this Act occurs.
11    "Person" means an individual, partnership, limited
12liability company, unincorporated association, corporation, or
13other legal entity.
14    "Merchant" means a person, firm, association, partnership,
15or corporation primarily engaged in the business of selling
16tangible personal property at retail.
17    "Secretary" means the Secretary of Financial and
18Professional Regulation.
19    Section 15. Incidental business only. A merchant may engage
20in the check cashing business only if it is incidental to the
21business of selling tangible personal property at retail.
22    Section 20. Applicability.
23    (a) Except as otherwise provided in this Section, this Act
24applies to any check casher that engages or offers to engage in



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1the check cashing business for a fee to Illinois consumers.
2Anyone not a check casher, except as provided in this Section,
3may not cash checks for a fee.
4    (b) The provisions of this Act apply to any person or
5entity that seeks to evade its applicability by any device,
6subterfuge, or pretense whatsoever.
7    (c) Banks, savings banks, savings and loan associations,
8and credit unions organized, chartered, or holding a
9certificate of authority to do business under the laws of this
10State or any other state or under the laws of the United States
11are exempt from the provisions of this Act.
12    (d) A check casher that is an agent for a bank, savings
13bank, savings and loan association, or credit union shall be
14subject to all of the provisions of this Act.
15    (e) Currency exchanges licensed pursuant to the Currency
16Exchange Act and in compliance with all relevant State and
17federal rules and regulations are exempt from the provisions of
18this Act.
19    Section 25. Money received by the Department. All moneys
20received by the Department under this Act shall be deposited in
21the Financial Institutions Fund created under Section 6z-26 of
22the State Finance Act.
23    Section 30. Permitted fees.
24    (a) The fees charged by a check casher may not exceed the



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1greater of $0.50 or 1% of the face value of the check cashed.
2No check casher shall charge or collect any sum for cashing a
3check in excess of the fees allowed by this Act. If there are
4insufficient funds to cover a check, a check casher may charge
5a fee not to exceed $25. Only one such fee may be collected by
6the check casher per check.
7    (b) The schedule of fees and charges permitted under this
8Section shall be conspicuously and continuously posted in at
9least 14-point font in English and the dominant languages
10spoken in in each check casher's location.
11    Section 35. Proceeds. A check casher shall issue the
12proceeds of a check to a consumer in cash. No check casher
13shall issue proceeds of a check in an amount other than the
14face value of the check, except for the deduction of check
15cashing fees charged pursuant to this Act.
16    Section 40. Deposits. Before a check casher deposits, with
17any banking or other financial institution, a check cashed by
18the check casher, the check must be endorsed with the name
19under which the check casher is doing business.
20    Section 45. Reporting requirements. A check casher shall
21submit to the Secretary, or the Secretary's designee, any
22suspicious activity reports or currency transaction reports as
23are required to be submitted to federal authorities pursuant to



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1the federal Bank Secrecy Act, and regulations and
2administrative orders related thereto, as amended, within the
3periods of time as required by the federal Bank Secrecy Act and
4regulations. A check casher may submit a copy of any report to
5the Secretary, or Secretary's designee, that is filed with that
6federal authority. The Secretary may adopt rules or require
7additional reports as he or she deems necessary to ensure
8effective enforcement of this Section.
9    Section 50. Forged checks. A check casher shall post in a
10conspicuous location, clearly visible to all patrons, a
11statement printed in at least 14-point font in plain language,
12in English and in the dominant languages spoken in in each
13check casher's location, informing the public that cashing a
14forged check is illegal and those who knowingly cash forged
15checks will be prosecuted pursuant to the applicable provisions
16of the Criminal Code of 1961.
17    Section 55. Examination of check cashers; records.
18    (a) A check casher shall keep and use books, accounts, and
19records that will enable the Secretary to determine whether the
20check casher is complying with the provisions of this Act and
21maintain any other records as required by the Secretary. Check
22cashers shall preserve their books, accounts, and records for 5
23years from the date of each transaction.
24    (b) For the purpose of discovering violations of this Act



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1or securing information lawfully required in this Section, the
2Department may at any time, and as often as may be determined,
3investigate the check casher's books, accounts, records,
4files, and any other document related to the check casher's
5check cashing business activities. The Secretary and his or her
6designee shall have free access to the offices and places of
7business, books, accounts, papers, records, files, safes, and
8vaults of all check cashers.
9    (c) Confidentiality. All information collected by the
10Department in the course of an examination or investigation of
11a check casher including, but not limited to, any complaint
12against a check casher filed with the Department and
13information collected to investigate any such complaint, shall
14be maintained for the confidential use of the Department and
15may not be disclosed. The Department may not disclose such
16information to anyone other than law enforcement officials,
17other regulatory agencies that have an appropriate regulatory
18interest as determined by the Secretary, or a party presenting
19a lawful subpoena to the Department. Information disclosed to a
20federal, State, county, or local law enforcement agency may not
21be disclosed by the agency for any purpose to any other agency
22or person. A formal complaint filed against a check casher by
23the Department or any order issued by the Department against a
24check casher shall be a public record, except as otherwise
25prohibited by law.



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1    Section 60. Prohibited acts. A check casher may not commit,
2or have committed on behalf of the check casher, any of the
3following acts:
4    (1) Threatening to use the criminal process in this or any
5other state to enforce payment of a dishonored check.
6    (2) Using any device or agreement that would have the
7effect of charging or collecting more fees or charges than
8allowed by this Act, including, but not limited to, entering
9into a different type of transaction with the consumer.
10    (3) Engaging in unfair, deceptive, or fraudulent practices
11in the cashing of a check.
12    (4) Using or causing to be published or disseminated any
13advertising communication that contains false, misleading, or
14deceptive statements or representations. No check casher may
15advertise in any manner so as to indicate or imply that its
16rates or charges are in any way recommended, approved, set, or
17established by the State government or by this Act.
18    (5) Engaging in the business of making loans of money,
19discounting notes, bills of exchange, or other evidences of
20debt, or accepting deposits or bailments of money or other
21items except as provided by this Act.
22    (6) Extending credit.
23    (7) Using or attempting to use the check provided by the
24consumer as collateral for a transaction unrelated to a
25transaction authorized by this Act.
26    (8) Charging any fees or charges other than those



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1specifically authorized by this Act.
2    (9) Threatening to take any action against a consumer that
3is prohibited by this Act.
4    Section 65. Enforcement and remedies.
5    (a) The remedies provided in this Act are cumulative and
6apply to persons or entities subject to this Act.
7    (b) Any material violation of this Act, including the
8commission of an act prohibited under Section 60, constitutes a
9violation of the Consumer Fraud and Deceptive Business
10Practices Act.
11    (c) Subject to the Illinois Administrative Procedure Act,
12the Secretary may hold hearings, make findings of fact and
13conclusions of law, issue cease and desist orders, issue fines
14of up to $10,000 per violation, and refer the matter to the
15appropriate law enforcement agency for prosecution under this
16Act. All proceedings shall be open to the public.
17    (d) The Secretary may issue a cease and desist order to any
18check casher when in the opinion of the Secretary the check
19casher is violating or is about to violate any provision of
20this Act or any rule or requirement imposed in writing by the
21Department as a condition of granting any authorization
22permitted by this Act. The cease and desist order permitted by
23this subsection (d) is effective as of the date of service and
24may be issued prior to a hearing. The Secretary shall serve
25notice of his or her action, including, but not limited to, a



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1statement of the reasons for the action, either personally or
2by certified mail, return receipt requested. Service by
3certified mail shall be deemed completed when the notice is
4deposited in the U.S. Mail. Within 10 days of service of the
5cease and desist order, the check casher may request, in
6writing, a hearing.
7    If it is determined that the Secretary had the authority to
8issue the cease and desist order, he or she may issue such
9orders as may be reasonably necessary to correct, eliminate, or
10remedy the conduct. The powers vested in the Secretary by this
11subsection (d) are in addition to any and all other powers and
12remedies vested in the Secretary by law, and nothing in this
13subsection (d) shall be construed as requiring that the
14Secretary shall employ the power conferred in this subsection
15instead of or as a condition precedent to the exercise of any
16other power or remedy vested in the Secretary.
17    (e) The Secretary may, after 10 days' notice by registered
18mail to the check casher at the check casher's business address
19stating the contemplated action and in general the grounds
20therefor, fine the check casher an amount not exceeding $10,000
21per violation if he or she finds that the check casher has
22failed to comply with any provision of this Act or any order,
23decision, finding, rule, regulation, or direction of the
24Secretary lawfully made pursuant to the authority of this Act.
25    The Secretary may fine only the particular location with
26respect to which grounds for the fine occur or exist, but if



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1the Secretary finds that grounds for the fine are of general
2application to all locations or to more than one location of
3the check casher, the Secretary may fine every check casher's
4location to which the grounds apply.
5     An order assessing a fine shall take effect upon service
6of the order unless the check casher requests a hearing within
710 days of service of the order pursuant to this Section. In
8the event a hearing is requested, the order shall be stayed
9until a final administrative order is entered.
10    The hearing shall be held at the time and place designated
11by the Secretary. The Secretary and any administrative law
12judge designated by him or her shall 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 or she considers relevant or material to
17the inquiry.
18    (f) The costs of administrative hearings conducted
19pursuant to this Section shall be paid by the check casher.
20    Section 70. Rulemaking. The Department may make and enforce
21such reasonable rules, regulations, directions, orders,
22decisions, and findings as the execution and enforcement of the
23provisions of this Act require, and as are not inconsistent
24therewith. All rules, regulations, and directions of a general
25character shall be made available to all check cashers in



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1electronic form.
2    Section 75. Judicial review. All final administrative
3decisions of the Department under this Act are subject to
4judicial review pursuant to the provisions of the
5Administrative Review Law and any rules adopted pursuant
7    Section 80. No waivers. There shall be no waiver of any
8provision of this Act.
9    (815 ILCS 315/Act rep.)
10    Section 100. The Check Cashing Act is repealed.
11    Section 905. The Payday Loan Reform Act is amended by
12changing Section 1-15 as follows:
13    (815 ILCS 122/1-15)
14    Sec. 1-15. Applicability.
15    (a) Except as otherwise provided in this Section, this Act
16applies to any lender that offers or makes a payday loan to a
17consumer in Illinois.
18    (b) The provisions of this Act apply to any person or
19entity that seeks to evade its applicability by any device,
20subterfuge, or pretense whatsoever.
21    (c) Retail sellers who cash checks incidental to a retail



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1sale and who charge no more than the fees as provided by the
2Check Cashers Act Check Cashing Act per check for the service
3are exempt from the provisions of this Act.
4    (d) Banks, savings banks, savings and loan associations,
5credit unions, and insurance companies organized, chartered,
6or holding a certificate of authority to do business under the
7laws of this State or any other state or under the laws of the
8United States are exempt from the provisions of this Act.
9    (e) A lender, as defined in Section 1-10, that is an agent
10for a bank, savings bank, savings and loan association, credit
11union, or insurance company for the purpose of brokering,
12selling, or otherwise offering payday loans made by the bank,
13savings bank, savings and loan association, credit union, or
14insurance company shall be subject to all of the provisions of
15this Act, except those provisions related to finance charges.
16(Source: P.A. 94-13, eff. 12-6-05.)
17    Section 910. The Consumer Fraud and Deceptive Business
18Practices Act is amended by changing Section 2Z as follows:
19    (815 ILCS 505/2Z)  (from Ch. 121 1/2, par. 262Z)
20    Sec. 2Z. Violations of other Acts. Any person who knowingly
21violates the Automotive Repair Act, the Automotive Collision
22Repair Act, the Home Repair and Remodeling Act, the Dance
23Studio Act, the Physical Fitness Services Act, the Hearing
24Instrument Consumer Protection Act, the Illinois Union Label



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1Act, the Job Referral and Job Listing Services Consumer
2Protection Act, the Travel Promotion Consumer Protection Act,
3the Credit Services Organizations Act, the Automatic Telephone
4Dialers Act, the Pay-Per-Call Services Consumer Protection
5Act, the Telephone Solicitations Act, the Illinois Funeral or
6Burial Funds Act, the Cemetery Oversight Act, the Cemetery Care
7Act, the Safe and Hygienic Bed Act, the Pre-Need Cemetery Sales
8Act, the High Risk Home Loan Act, the Payday Loan Reform Act,
9the Mortgage Rescue Fraud Act, subsection (a) or (b) of Section
103-10 of the Cigarette Tax Act, subsection (a) or (b) of Section
113-10 of the Cigarette Use Tax Act, the Electronic Mail Act, the
12Internet Caller Identification Act, paragraph (6) of
13subsection (k) of Section 6-305 of the Illinois Vehicle Code,
14Section 11-1431, 18d-115, 18d-120, 18d-125, 18d-135, 18d-150,
15or 18d-153 of the Illinois Vehicle Code, Article 3 of the
16Residential Real Property Disclosure Act, the Automatic
17Contract Renewal Act, the Check Cashers Act, or the Personal
18Information Protection Act commits an unlawful practice within
19the meaning of this Act.
20(Source: P.A. 96-863, eff. 1-19-10; 96-1369, eff. 1-1-11;
2196-1376, eff. 7-29-10; 97-333, eff. 8-12-11.)
22    Section 996. Severability. The provisions of this Act are
23severable under Section 1.31 of the Statute on Statutes.
24    Section 999. Effective date. This Act takes effect 180 days
25after becoming law.