S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7067

                            I N  S E N A T E

                             March 10, 2010
                               ___________

Introduced  by  Sen.  FOLEY  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Consumer Protection

AN ACT to amend the general business law, in relation to debt management
  services; and to amend the banking law, in  relation  to  the  uniform
  debt-management services act; and repealing certain provisions of such
  laws relating thereto

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The article heading of article 28-B of the general business
law, as added by chapter 1031 of the laws of 1965, is amended to read as
follows:
               [BUDGET PLANNING] DEBT-MANAGEMENT SERVICES
  S 2. Section 455 of the general business law is  REPEALED  and  a  new
section 455 is added to read as follows:
  S 455. DEFINITIONS. DEBT-MANAGEMENT SERVICES, AS USED IN THIS ARTICLE,
MEANS THE MAKING OF A CONTRACT BETWEEN A PERSON OR ENTITY ENGAGED IN THE
BUSINESS  OF  PROVIDING  DEBT-MANAGEMENT  SERVICES AS DEFINED IN ARTICLE
TWELVE-C OF THE BANKING LAW.
  S 3. Section 456 of the general business law, as  amended  by  chapter
456 of the laws of 2006, is amended to read as follows:
  S  456.  [Budget  planning]  DEBT-MANAGEMENT  prohibited. No person or
entity shall engage in  the  business  of  [budget  planning]  PROVIDING
DEBT-MANAGEMENT  SERVICES  as defined in section four hundred fifty-five
of this article, except as authorized in article twelve-C of the banking
law.
  S 4. Article 12-C of the banking law is REPEALED  and  a  new  article
12-C is added to read as follows:
                              ARTICLE 12-C
                  UNIFORM DEBT-MANAGEMENT SERVICES ACT
SECTION 579. SHORT TITLE.
        579-A. DEFINITIONS.
        579-B. EXEMPT AGREEMENTS AND PERSONS.
        579-C. REGISTRATION AND NOT-FOR-PROFIT STATUS REQUIRED.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10740-04-0
              

S. 7067                             2

        580. APPLICATION  FOR  REGISTRATION; FORM, FEE, AND ACCOMPANYING
               DOCUMENTS.
        580-A. APPLICATION FOR REGISTRATION; REQUIRED INFORMATION.
        580-B. APPLICATION FOR REGISTRATION; OBLIGATION TO UPDATE.
        580-C. APPLICATION FOR REGISTRATION; PUBLIC INFORMATION.
        581. CERTIFICATE OF REGISTRATION; ISSUANCE OR DENIAL.
        581-A. CERTIFICATE OF REGISTRATION; TIMING.
        581-B. RENEWAL OF REGISTRATION.
        581-C. REGISTRATION IN ANOTHER STATE.
        582. BOND REQUIRED.
        582-A. BOND REQUIRED; SUBSTITUTE.
        582-B. REQUIREMENT OF GOOD FAITH.
        582-C. CUSTOMER SERVICE.
        583. PREREQUISITES FOR PROVIDING DEBT-MANAGEMENT SERVICES.
        583-A. COMMUNICATION BY ELECTRONIC OR OTHER MEANS.
        583-B. FORM AND CONTENTS OF AGREEMENT.
        583-C. CANCELLATION OF AGREEMENT; WAIVER.
        584. REQUIRED LANGUAGE.
        584-A. TRUST ACCOUNT.
        584-B. FEES AND OTHER CHARGES.
        584-C. VOLUNTARY CONTRIBUTIONS.
        585. VOIDABLE AGREEMENTS.
        585-A. TERMINATION OF AGREEMENT.
        585-B. PERIODIC REPORTS AND RETENTION OF RECORDS.
        585-C. PROHIBITED ACTS AND PRACTICES.
        586. NOTICE OF LITIGATION.
        586-A. ADVERTISING.
        586-B. LIABILITY FOR THE CONDUCT OF OTHER PERSONS.
        586-C. POWERS OF SUPERINTENDENT.
        587. ADMINISTRATIVE REMEDIES.
        587-A. SUSPENSION, REVOCATION, OR NONRENEWAL OF REGISTRATION.
        587-B. PRIVATE ENFORCEMENT.
        587-C. VIOLATION OF THE GENERAL BUSINESS LAW.
        588. STATUTE OF LIMITATIONS.
        588-A. UNIFORMITY OF APPLICATION AND CONSTRUCTION.
        588-B. RELATION  TO ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL
               COMMERCE ACT.
        588-C. TRANSITIONAL PROVISIONS; APPLICATION TO  EXISTING  TRANS-
               ACTIONS.
  S  579.  SHORT  TITLE. THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE
"UNIFORM DEBT-MANAGEMENT SERVICES ACT".
  S 579-A. DEFINITIONS. IN THIS ARTICLE:
  1. "SUPERINTENDENT" MEANS THE SUPERINTENDENT OF BANKS.
  2. "AFFILIATE":
  (A) WITH RESPECT TO AN INDIVIDUAL, MEANS:
  (I) THE SPOUSE OF THE INDIVIDUAL;
  (II) A SIBLING OF THE INDIVIDUAL OR THE SPOUSE OF A SIBLING;
  (III) AN INDIVIDUAL OR THE SPOUSE OF AN INDIVIDUAL  WHO  IS  A  LINEAL
ANCESTOR  OR  LINEAL  DESCENDANT  OF  THE INDIVIDUAL OR THE INDIVIDUAL'S
SPOUSE;
  (IV) AN AUNT, UNCLE, GREAT AUNT, GREAT  UNCLE,  FIRST  COUSIN,  NIECE,
NEPHEW,  GRANDNIECE,  OR  GRANDNEPHEW,  WHETHER RELATED BY WHOLE OR HALF
BLOOD OR ADOPTION, OR THE SPOUSE OF ANY OF THEM; OR
  (V) ANY OTHER INDIVIDUAL OCCUPYING THE RESIDENCE  OF  THE  INDIVIDUAL;
AND
  (B) WITH RESPECT TO AN ENTITY, MEANS:

S. 7067                             3

  (I)  A  PERSON THAT DIRECTLY OR INDIRECTLY CONTROLS, IS CONTROLLED BY,
OR IS UNDER COMMON CONTROL WITH THE ENTITY;
  (II) AN OFFICER OF, OR AN INDIVIDUAL PERFORMING SIMILAR FUNCTIONS WITH
RESPECT TO, THE ENTITY;
  (III)  A  DIRECTOR  OF,  OR AN INDIVIDUAL PERFORMING SIMILAR FUNCTIONS
WITH RESPECT TO, THE ENTITY;
  (IV) SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT  TO  SUBDIVI-
SION  SIX OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, A PERSON
THAT RECEIVES OR RECEIVED MORE THAN TWENTY-FIVE  THOUSAND  DOLLARS  FROM
THE  ENTITY IN EITHER THE CURRENT YEAR OR THE PRECEDING YEAR OR A PERSON
THAT OWNS MORE THAN TEN PERCENT OF, OR AN INDIVIDUAL WHO IS EMPLOYED  BY
OR  IS A DIRECTOR OF, A PERSON THAT RECEIVES OR RECEIVED MORE THAN TWEN-
TY-FIVE THOUSAND DOLLARS FROM THE ENTITY IN EITHER THE CURRENT  YEAR  OR
THE PRECEDING YEAR;
  (V)  AN  EXECUTIVE OFFICER OR DIRECTOR OF, OR AN INDIVIDUAL PERFORMING
SIMILAR FUNCTIONS WITH RESPECT TO, A PERSON  DESCRIBED  IN  SUBPARAGRAPH
(I) OF THIS PARAGRAPH;
  (VI)  THE  SPOUSE  OF, OR AN INDIVIDUAL OCCUPYING THE RESIDENCE OF, AN
INDIVIDUAL DESCRIBED IN SUBPARAGRAPHS (I) THROUGH (V) OF THIS PARAGRAPH;
OR
  (VII) AN INDIVIDUAL WHO HAS THE RELATIONSHIP SPECIFIED IN SUBPARAGRAPH
(IV) OF PARAGRAPH (A) OF THIS SUBDIVISION TO AN INDIVIDUAL OR THE SPOUSE
OF AN INDIVIDUAL DESCRIBED IN SUBPARAGRAPHS  (I)  THROUGH  (V)  OF  THIS
PARAGRAPH.
  3. "AGREEMENT" MEANS AN AGREEMENT BETWEEN A PROVIDER AND AN INDIVIDUAL
FOR THE PERFORMANCE OF DEBT-MANAGEMENT SERVICES.
  4.  "BANK" MEANS A FINANCIAL INSTITUTION, INCLUDING A COMMERCIAL BANK,
SAVINGS BANK, SAVINGS AND LOAN  ASSOCIATION,  CREDIT  UNION,  AND  TRUST
COMPANY,  ENGAGED IN THE BUSINESS OF BANKING, CHARTERED UNDER FEDERAL OR
STATE LAW, AND REGULATED  BY  A  FEDERAL  OR  STATE  BANKING  REGULATORY
AUTHORITY.
  5.  "BUSINESS  ADDRESS"  MEANS  THE  PHYSICAL  LOCATION OF A BUSINESS,
INCLUDING THE NAME AND NUMBER OF A STREET.
  6. (A) "CERTIFIED COUNSELOR" MEANS AN INDIVIDUAL CERTIFIED BY A TRAIN-
ING PROGRAM OR CERTIFYING ORGANIZATION, APPROVED BY THE  SUPERINTENDENT,
THAT AUTHENTICATES THE COMPETENCE OF INDIVIDUALS PROVIDING EDUCATION AND
ASSISTANCE  TO  OTHER  INDIVIDUALS  IN  CONNECTION  WITH DEBT-MANAGEMENT
SERVICES IN WHICH AN AGREEMENT CONTEMPLATES THAT CREDITORS  WILL  REDUCE
FINANCE CHARGES OR FEES FOR LATE PAYMENT, DEFAULT, OR DELINQUENCY.
  (B)  "CERTIFIED  DEBT  SPECIALIST"  MEANS AN INDIVIDUAL CERTIFIED BY A
TRAINING PROGRAM OR CERTIFYING ORGANIZATION, APPROVED BY THE SUPERINTEN-
DENT, THAT AUTHENTICATES THE COMPETENCE OF INDIVIDUALS PROVIDING  EDUCA-
TION AND ASSISTANCE TO OTHER INDIVIDUALS IN CONNECTION WITH DEBT-MANAGE-
MENT  SERVICES  IN  WHICH  AN AGREEMENT CONTEMPLATES THAT CREDITORS WILL
SETTLE DEBTS FOR LESS THAN THE FULL PRINCIPAL AMOUNT OF DEBT OWED.
  7. "CONCESSIONS" MEANS ASSENT TO REPAYMENT OF A  DEBT  ON  TERMS  MORE
FAVORABLE  TO  AN  INDIVIDUAL THAN THE TERMS OF THE CONTRACT BETWEEN THE
INDIVIDUAL AND A CREDITOR.
  8. "DAY" MEANS CALENDAR DAY.
  9.  "DEBT-MANAGEMENT  SERVICES"  MEANS  SERVICES  AS  AN  INTERMEDIARY
BETWEEN  AN  INDIVIDUAL  AND ONE OR MORE CREDITORS OF THE INDIVIDUAL FOR
THE PURPOSE OF OBTAINING CONCESSIONS, BUT DOES NOT INCLUDE:
  (A) LEGAL SERVICES PROVIDED IN AN ATTORNEY-CLIENT RELATIONSHIP  BY  AN
ATTORNEY  LICENSED OR OTHERWISE AUTHORIZED TO PRACTICE LAW IN THIS STATE
IF THE PROVISION OF DEBT MANAGEMENT SERVICES IS INCIDENTAL TO THE  PRAC-
TICE OF LAW;

S. 7067                             4

  (B)  ACCOUNTING SERVICES PROVIDED IN AN ACCOUNTANT-CLIENT RELATIONSHIP
BY A CERTIFIED PUBLIC ACCOUNTANT LICENSED TO PROVIDE ACCOUNTING SERVICES
IN THIS STATE; OR
  (C) FINANCIAL-PLANNING SERVICES PROVIDED IN A FINANCIAL PLANNER-CLIENT
RELATIONSHIP  BY  A  MEMBER  OF  A  FINANCIAL-PLANNING  PROFESSION WHOSE
MEMBERS THE SUPERINTENDENT, BY RULE, DETERMINES ARE:
  (I) LICENSED BY THIS STATE;
  (II) SUBJECT TO A DISCIPLINARY MECHANISM;
  (III) SUBJECT TO A CODE OF PROFESSIONAL RESPONSIBILITY; AND
  (IV) SUBJECT TO A CONTINUING-EDUCATION REQUIREMENT.
  10. "ENTITY" MEANS A PERSON OTHER THAN AN INDIVIDUAL.
  11. "GOOD FAITH" MEANS HONESTY IN FACT AND THE OBSERVANCE  OF  REASON-
ABLE STANDARDS OF FAIR DEALING.
  12. "PERSON" MEANS AN INDIVIDUAL, CORPORATION, BUSINESS TRUST, ESTATE,
TRUST,   PARTNERSHIP,  LIMITED  LIABILITY  COMPANY,  ASSOCIATION,  JOINT
VENTURE, OR ANY OTHER LEGAL OR COMMERCIAL  ENTITY.  THE  TERM  DOES  NOT
INCLUDE  A  PUBLIC CORPORATION, GOVERNMENT, OR GOVERNMENTAL SUBDIVISION,
AGENCY, OR INSTRUMENTALITY.
  13. "PLAN" MEANS A PROGRAM OR STRATEGY IN WHICH A  PROVIDER  FURNISHES
DEBT-MANAGEMENT  SERVICES TO AN INDIVIDUAL AND WHICH INCLUDES A SCHEDULE
OF PAYMENTS TO BE MADE BY OR ON BEHALF OF THE INDIVIDUAL AND USED TO PAY
DEBTS OWED BY THE INDIVIDUAL.
  14. "PRINCIPAL AMOUNT OF THE DEBT" MEANS THE AMOUNT OF A DEBT  AT  THE
TIME OF AN AGREEMENT.
  15.  "PROVIDER"  MEANS  A  PERSON THAT PROVIDES, OFFERS TO PROVIDE, OR
AGREES TO PROVIDE DEBT-MANAGEMENT SERVICES DIRECTLY OR THROUGH OTHERS.
  16. "RECORD" MEANS INFORMATION THAT IS INSCRIBED ON A TANGIBLE  MEDIUM
OR THAT IS STORED IN AN ELECTRONIC OR OTHER MEDIUM AND IS RETRIEVABLE IN
PERCEIVABLE FORM.
  17.  "SETTLEMENT FEE" MEANS A CHARGE IMPOSED ON OR PAID BY AN INDIVID-
UAL IN CONNECTION WITH A CREDITOR'S ASSENT TO ACCEPT IN  FULL  SATISFAC-
TION OF A DEBT AN AMOUNT LESS THAN THE PRINCIPAL AMOUNT OF THE DEBT.
  18.  "SIGN"  MEANS,  WITH  PRESENT  INTENT  TO AUTHENTICATE OR ADOPT A
RECORD:
  (A) TO EXECUTE OR ADOPT A TANGIBLE SYMBOL; OR
  (B) TO ATTACH TO OR LOGICALLY ASSOCIATE WITH THE RECORD AN  ELECTRONIC
SOUND, SYMBOL, OR PROCESS.
  19. "STATE" MEANS A STATE OF THE UNITED STATES, THE DISTRICT OF COLUM-
BIA,  PUERTO RICO, THE UNITED STATES VIRGIN ISLANDS, OR ANY TERRITORY OR
INSULAR POSSESSION SUBJECT TO THE JURISDICTION OF THE UNITED STATES.
  20. "TRUST ACCOUNT" MEANS AN ACCOUNT HELD BY A PROVIDER THAT IS:
  (A) ESTABLISHED IN AN INSURED BANK;
  (B) SEPARATE FROM OTHER ACCOUNTS OF THE PROVIDER OR ITS DESIGNEE;
  (C) DESIGNATED AS A TRUST ACCOUNT OR OTHER ACCOUNT DESIGNATED TO INDI-
CATE THAT THE MONEY IN THE ACCOUNT IS NOT THE MONEY OF THE  PROVIDER  OR
ITS DESIGNEE; AND
  (D)  USED TO HOLD MONEY OF ONE OR MORE INDIVIDUALS FOR DISBURSEMENT TO
CREDITORS OF THE INDIVIDUALS.
  S 579-B. EXEMPT AGREEMENTS AND PERSONS. 1. THIS ARTICLE DOES NOT APPLY
TO AN AGREEMENT WITH AN INDIVIDUAL WHO THE PROVIDER  HAS  NO  REASON  TO
KNOW RESIDES IN THIS STATE AT THE TIME OF THE AGREEMENT.
  2.  THIS  ARTICLE  DOES NOT APPLY TO A PROVIDER TO THE EXTENT THAT THE
PROVIDER:
  (A) PROVIDES OR AGREES TO  PROVIDE  DEBT-MANAGEMENT,  EDUCATIONAL,  OR
COUNSELING  SERVICES  TO AN INDIVIDUAL WHO THE PROVIDER HAS NO REASON TO

S. 7067                             5

KNOW RESIDES IN THIS STATE AT THE TIME THE PROVIDER  AGREES  TO  PROVIDE
THE SERVICES; OR
  (B)  RECEIVES  NO COMPENSATION FOR DEBT-MANAGEMENT SERVICES FROM OR ON
BEHALF OF THE INDIVIDUALS TO WHOM IT PROVIDES THE SERVICES OR FROM THEIR
CREDITORS.
  3. THIS ARTICLE DOES NOT APPLY  TO  THE  FOLLOWING  PERSONS  OR  THEIR
EMPLOYEES  WHEN  THE  PERSON  OR  THE EMPLOYEE IS ENGAGED IN THE REGULAR
COURSE OF THE PERSON'S BUSINESS OR PROFESSION:
  (A) A JUDICIAL OFFICER, A PERSON ACTING UNDER AN ORDER OF A  COURT  OR
AN ADMINISTRATIVE AGENCY, OR AN ASSIGNEE FOR THE BENEFIT OF CREDITORS;
  (B) A BANK;
  (C) AN AFFILIATE OR AGENT OF A BANK IF THE AFFILIATE IS REGULATED BY A
FEDERAL OR STATE BANKING REGULATORY AUTHORITY; OR
  (D)  A  TITLE  INSURER,  ESCROW COMPANY, OR OTHER PERSON THAT PROVIDES
BILL-PAYING SERVICES IF THE PROVISION  OF  DEBT-MANAGEMENT  SERVICES  IS
INCIDENTAL TO THE BILL-PAYING SERVICES.
  S 579-C. REGISTRATION AND NOT-FOR-PROFIT STATUS REQUIRED. 1. EXCEPT AS
OTHERWISE  PROVIDED  IN  SUBDIVISION TWO OF THIS SECTION, A PROVIDER MAY
NOT PROVIDE DEBT-MANAGEMENT SERVICES TO AN INDIVIDUAL WHO IT  REASONABLY
SHOULD  KNOW  RESIDES IN THIS STATE AT THE TIME IT AGREES TO PROVIDE THE
SERVICES, UNLESS THE PROVIDER IS REGISTERED UNDER THIS ARTICLE.
  2. IF A PROVIDER IS REGISTERED UNDER THIS ARTICLE, SUBDIVISION ONE  OF
THIS SECTION DOES NOT APPLY TO AN EMPLOYEE OR AGENT OF THE PROVIDER.
  3. THE SUPERINTENDENT SHALL MAINTAIN AND PUBLICIZE A LIST OF THE NAMES
OF ALL REGISTERED PROVIDERS.
  S 580. APPLICATION FOR REGISTRATION; FORM, FEE, AND ACCOMPANYING DOCU-
MENTS.  1.  AN  APPLICATION  FOR REGISTRATION AS A PROVIDER MUST BE IN A
FORM PRESCRIBED BY THE SUPERINTENDENT.
  2. SUBJECT TO ADJUSTMENT OF DOLLAR AMOUNTS PURSUANT TO SUBDIVISION SIX
OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, AN APPLICATION FOR
REGISTRATION AS A PROVIDER MUST BE ACCOMPANIED BY:
  (A) THE FEE ESTABLISHED BY THE SUPERINTENDENT;
  (B) THE BOND REQUIRED BY SECTION FIVE HUNDRED EIGHTY-TWO OF THIS ARTI-
CLE;
  (C) IDENTIFICATION OF ALL TRUST  ACCOUNTS  REQUIRED  BY  SECTION  FIVE
HUNDRED EIGHTY-FOUR-A OF THIS ARTICLE AND AN IRREVOCABLE CONSENT AUTHOR-
IZING THE SUPERINTENDENT TO REVIEW AND EXAMINE THE TRUST ACCOUNTS;
  (D)  EVIDENCE OF INSURANCE IN THE AMOUNT OF TWO HUNDRED FIFTY THOUSAND
DOLLARS:
  (I) AGAINST THE RISKS OF DISHONESTY, FRAUD, THEFT, AND  OTHER  MISCON-
DUCT  ON  THE PART OF THE APPLICANT OR A DIRECTOR, EMPLOYEE, OR AGENT OF
THE APPLICANT;
  (II) ISSUED BY AN INSURANCE COMPANY AUTHORIZED TO DO BUSINESS IN  THIS
STATE  AND  RATED  AT  LEAST  A OR EQUIVALENT BY A NATIONALLY RECOGNIZED
RATING ORGANIZATION APPROVED BY THE SUPERINTENDENT;
  (III) WITH A DEDUCTIBLE NOT EXCEEDING FIVE THOUSAND DOLLARS;
  (IV) PAYABLE FOR THE BENEFIT OF THE APPLICANT, THIS STATE,  AND  INDI-
VIDUALS  WHO ARE RESIDENTS OF THIS STATE, AS THEIR INTERESTS MAY APPEAR;
AND
  (V) NOT SUBJECT TO CANCELLATION BY THE APPLICANT OR THE INSURER  UNTIL
SIXTY DAYS AFTER WRITTEN NOTICE HAS BEEN GIVEN TO THE SUPERINTENDENT;
  (E) A RECORD CONSENTING TO THE JURISDICTION OF THIS STATE CONTAINING:
  (I)  THE  NAME, BUSINESS ADDRESS, AND OTHER CONTACT INFORMATION OF ITS
REGISTERED AGENT IN THIS STATE FOR PURPOSES OF SERVICE OF PROCESS; OR
  (II) THE APPOINTMENT OF THE SUPERINTENDENT AS AGENT  OF  THE  PROVIDER
FOR PURPOSES OF SERVICE OF PROCESS; AND

S. 7067                             6

  (F)  IF  THE APPLICANT IS EXEMPT FROM TAXATION, EVIDENCE OF TAX-EXEMPT
STATUS APPLICABLE TO THE APPLICANT UNDER THE INTERNAL REVENUE  CODE,  26
U.S.C. SECTION 501, AS AMENDED.
  S 580-A. APPLICATION FOR REGISTRATION; REQUIRED INFORMATION. AN APPLI-
CATION FOR REGISTRATION MUST BE SIGNED UNDER OATH AND INCLUDE:
  1.  THE  APPLICANT'S  NAME,  PRINCIPAL  BUSINESS ADDRESS AND TELEPHONE
NUMBER, AND ALL OTHER BUSINESS ADDRESSES IN THIS STATE,  ELECTRONIC-MAIL
ADDRESSES, AND INTERNET WEBSITE ADDRESSES;
  2. ALL NAMES UNDER WHICH THE APPLICANT CONDUCTS BUSINESS;
  3.  THE  ADDRESS OF EACH LOCATION IN THIS STATE AT WHICH THE APPLICANT
WILL PROVIDE DEBT-MANAGEMENT SERVICES OR A STATEMENT THAT THE  APPLICANT
WILL HAVE NO SUCH LOCATION;
  4.  THE  NAME  AND  HOME  ADDRESS  OF EACH OFFICER AND DIRECTOR OF THE
APPLICANT AND EACH PERSON THAT OWNS AT LEAST TEN PERCENT OF  THE  APPLI-
CANT;
  5.  IDENTIFICATION  OF  EVERY  JURISDICTION  IN WHICH, DURING THE FIVE
YEARS IMMEDIATELY PRECEDING THE APPLICATION:
  (A) THE APPLICANT OR  ANY  OF  ITS  OFFICERS  OR  DIRECTORS  HAS  BEEN
LICENSED OR REGISTERED TO PROVIDE DEBT-MANAGEMENT SERVICES; OR
  (B)  INDIVIDUALS  HAVE  RESIDED  WHEN  THEY  RECEIVED  DEBT-MANAGEMENT
SERVICES FROM THE APPLICANT;
  6. A STATEMENT DESCRIBING, TO THE EXTENT IT  IS  KNOWN  OR  SHOULD  BE
KNOWN BY THE APPLICANT, ANY MATERIAL CIVIL OR CRIMINAL JUDGMENT OR LITI-
GATION  AND  ANY  MATERIAL  ADMINISTRATIVE  OR  ENFORCEMENT  ACTION BY A
GOVERNMENTAL AGENCY IN ANY JURISDICTION AGAINST THE  APPLICANT,  ANY  OF
ITS OFFICERS, DIRECTORS, OWNERS, OR AGENTS, OR ANY PERSON WHO IS AUTHOR-
IZED  TO  HAVE  ACCESS  TO  THE  TRUST  ACCOUNT REQUIRED BY SECTION FIVE
HUNDRED EIGHTY-FOUR-A OF THIS ARTICLE;
  7. THE APPLICANT'S FINANCIAL STATEMENTS FOR  EACH  OF  THE  TWO  YEARS
IMMEDIATELY  PRECEDING  THE APPLICATION OR, IF IT HAS NOT BEEN IN OPERA-
TION FOR THE TWO YEARS PRECEDING THE APPLICATION, FOR THE PERIOD OF  ITS
EXISTENCE,  HOWEVER,  IF  THE  COMPANY  DOES  NOT  HOLD DEBTOR FUNDS FOR
PAYMENT  TO  CREDITORS  IN  TRUST  PURSUANT  TO  SECTION  FIVE   HUNDRED
EIGHTY-FOUR-A  OF  THIS  ARTICLE  THE  FINANCIAL STATEMENTS NEED ONLY BE
REVIEWED BY A LICENSED ACCOUNTANT;
  8. EVIDENCE OF ACCREDITATION BY AN INDEPENDENT  ACCREDITING  ORGANIZA-
TION APPROVED BY THE SUPERINTENDENT;
  9.  EVIDENCE THAT, WITHIN TWELVE MONTHS AFTER INITIAL EMPLOYMENT, EACH
OF THE APPLICANT'S COUNSELORS BECOMES CERTIFIED AS A CERTIFIED COUNSELOR
OR CERTIFIED DEBT SPECIALIST;
  10. A DESCRIPTION OF THE THREE MOST COMMONLY USED EDUCATIONAL PROGRAMS
THAT THE APPLICANT PROVIDES OR INTENDS TO  PROVIDE  TO  INDIVIDUALS  WHO
RESIDE  IN  THIS STATE AND A COPY OF ANY MATERIALS USED OR TO BE USED IN
THOSE PROGRAMS;
  11. A DESCRIPTION OF THE APPLICANT'S FINANCIAL  ANALYSIS  AND  INITIAL
BUDGET  PLAN,  INCLUDING  ANY FORM OR ELECTRONIC MODEL, USED TO EVALUATE
THE FINANCIAL CONDITION OF INDIVIDUALS;
  12. A COPY OF EACH FORM OF AGREEMENT THAT THE APPLICANT WILL USE  WITH
INDIVIDUALS WHO RESIDE IN THIS STATE;
  13.  THE SCHEDULE OF FEES AND CHARGES THAT THE APPLICANT WILL USE WITH
INDIVIDUALS WHO RESIDE IN THIS STATE;
  14. AT THE APPLICANT'S EXPENSE,  THE  RESULTS  OF  A  CRIMINAL-RECORDS
CHECK,  INCLUDING FINGERPRINTS, CONDUCTED WITHIN THE IMMEDIATELY PRECED-
ING TWELVE MONTHS, COVERING EVERY OFFICER OF  THE  APPLICANT  AND  EVERY
EMPLOYEE  OR  AGENT OF THE APPLICANT WHO IS AUTHORIZED TO HAVE ACCESS TO

S. 7067                             7

THE TRUST ACCOUNT REQUIRED BY SECTION FIVE HUNDRED EIGHTY-FOUR-A OF THIS
ARTICLE;
  15.  THE  NAMES AND ADDRESSES OF ALL EMPLOYERS OF EACH DIRECTOR DURING
THE TEN YEARS IMMEDIATELY PRECEDING THE APPLICATION;
  16. A DESCRIPTION OF ANY OWNERSHIP INTEREST OF AT LEAST TEN PERCENT BY
A DIRECTOR, OWNER, OR EMPLOYEE OF THE APPLICANT IN:
  (A) ANY AFFILIATE OF THE APPLICANT; OR
  (B) ANY ENTITY THAT PROVIDES PRODUCTS OR SERVICES TO THE APPLICANT  OR
ANY INDIVIDUAL RELATING TO THE APPLICANT'S DEBT-MANAGEMENT SERVICES;
  17. IF AN APPLICANT IS EXEMPT FROM TAXATION, A STATEMENT OF THE AMOUNT
OF  COMPENSATION OF THE APPLICANT'S FIVE MOST HIGHLY COMPENSATED EMPLOY-
EES FOR EACH OF THE THREE YEARS IMMEDIATELY  PRECEDING  THE  APPLICATION
OR,  IF  IT  HAS NOT BEEN IN OPERATION FOR THE THREE YEARS PRECEDING THE
APPLICATION, FOR THE PERIOD OF ITS EXISTENCE;
  18. THE IDENTITY OF EACH DIRECTOR WHO IS AN AFFILIATE  OF  THE  APPLI-
CANT; AND
  19.  ANY OTHER INFORMATION THAT THE SUPERINTENDENT REASONABLY REQUIRES
TO PERFORM THE SUPERINTENDENT'S DUTIES UNDER SECTION FIVE HUNDRED EIGHT-
Y-ONE OF THIS ARTICLE.
  S 580-B. APPLICATION FOR REGISTRATION; OBLIGATION TO UPDATE. AN APPLI-
CANT OR REGISTERED PROVIDER SHALL NOTIFY THE SUPERINTENDENT  WITHIN  TEN
DAYS AFTER A CHANGE IN THE INFORMATION SPECIFIED IN SECTION FIVE HUNDRED
EIGHTY OF THIS ARTICLE.
  S  580-C. APPLICATION FOR REGISTRATION; PUBLIC INFORMATION. EXCEPT FOR
THE INFORMATION REQUIRED BY SECTION FIVE HUNDRED EIGHTY-A OF THIS  ARTI-
CLE  AND THE ADDRESSES REQUIRED BY SUBDIVISION FOUR OF SUCH SECTION, THE
SUPERINTENDENT SHALL MAKE THE INFORMATION IN AN APPLICATION  FOR  REGIS-
TRATION AS A PROVIDER AVAILABLE TO THE PUBLIC.
  S  581.  CERTIFICATE OF REGISTRATION; ISSUANCE OR DENIAL. 1. EXCEPT AS
OTHERWISE PROVIDED IN SUBDIVISIONS THREE AND FOUR OF THIS  SECTION,  THE
SUPERINTENDENT  SHALL  ISSUE A CERTIFICATE OF REGISTRATION AS A PROVIDER
TO A PERSON THAT COMPLIES WITH SECTIONS   FIVE HUNDRED EIGHTY  AND  FIVE
HUNDRED EIGHTY-A OF THIS ARTICLE.
  2.  IF  AN APPLICANT HAS OTHERWISE COMPLIED WITH SECTIONS FIVE HUNDRED
EIGHTY AND FIVE HUNDRED EIGHTY-A OF THIS  ARTICLE,  INCLUDING  A  TIMELY
EFFORT  TO  OBTAIN  THE  INFORMATION REQUIRED BY SUBDIVISION FOURTEEN OF
SECTION FIVE HUNDRED EIGHTY-A OF THIS ARTICLE BUT  THE  INFORMATION  HAS
NOT  BEEN RECEIVED, THE SUPERINTENDENT MAY ISSUE A TEMPORARY CERTIFICATE
OF REGISTRATION. THE TEMPORARY CERTIFICATE SHALL EXPIRE  NO  LATER  THAN
ONE HUNDRED EIGHTY DAYS AFTER ISSUANCE.
  3. THE SUPERINTENDENT MAY DENY REGISTRATION IF:
  (A)  THE APPLICATION CONTAINS INFORMATION THAT IS MATERIALLY ERRONEOUS
OR INCOMPLETE;
  (B) AN OFFICER OR DIRECTOR OF THE APPLICANT HAS BEEN  CONVICTED  OF  A
CRIME,  OR  SUFFERED  A  CIVIL  JUDGMENT,  INVOLVING  DISHONESTY  OR THE
VIOLATION OF STATE OR FEDERAL SECURITIES LAWS;
  (C) THE APPLICANT OR ANY OF ITS OFFICERS OR DIRECTORS HAS DEFAULTED IN
THE PAYMENT OF MONEY COLLECTED FOR OTHERS; OR
  (D) THE SUPERINTENDENT FINDS THAT THE FINANCIAL RESPONSIBILITY,  EXPE-
RIENCE, CHARACTER, OR GENERAL FITNESS OF THE APPLICANT OR ITS DIRECTORS,
EMPLOYEES,  OR  AGENTS DOES NOT WARRANT BELIEF THAT THE BUSINESS WILL BE
OPERATED IN COMPLIANCE WITH THIS ARTICLE.
  4. THE SUPERINTENDENT SHALL DENY REGISTRATION IF, WITH RESPECT  TO  AN
APPLICANT  THAT  IS ORGANIZED AS A NOT-FOR-PROFIT ENTITY OR HAS OBTAINED
TAX-EXEMPT STATUS UNDER THE INTERNAL REVENUE  CODE,  26  U.S.C.  SECTION

S. 7067                             8

501,  AS  AMENDED, THE APPLICANT'S BOARD OF DIRECTORS IS NOT INDEPENDENT
OF THE APPLICANT'S EMPLOYEES AND AGENTS.
  5.  SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO SUBDIVISION
SIX OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS  ARTICLE,  A  BOARD  OF
DIRECTORS  IS  NOT  INDEPENDENT FOR PURPOSES OF SUBDIVISION FOUR OF THIS
SECTION IF MORE THAN ONE-FOURTH OF ITS MEMBERS:
  (A) ARE AFFILIATES OF THE APPLICANT; OR
  (B) AFTER THE DATE TEN YEARS BEFORE FIRST BECOMING A DIRECTOR  OF  THE
APPLICANT,  WERE EMPLOYED BY OR DIRECTORS OF A PERSON THAT RECEIVED FROM
THE APPLICANT MORE THAN  TWENTY-FIVE  THOUSAND  DOLLARS  IN  EITHER  THE
CURRENT YEAR OR THE PRECEDING YEAR.
  S  581-A.  CERTIFICATE  OF REGISTRATION; TIMING. 1. THE SUPERINTENDENT
SHALL APPROVE OR DENY AN INITIAL REGISTRATION AS A PROVIDER  WITHIN  ONE
HUNDRED  TWENTY DAYS AFTER AN APPLICATION IS FILED. IN CONNECTION WITH A
REQUEST PURSUANT TO SUBDIVISION NINETEEN OF SECTION FIVE HUNDRED  EIGHT-
Y-A  OF  THIS ARTICLE FOR ADDITIONAL INFORMATION, THE SUPERINTENDENT MAY
EXTEND THE ONE HUNDRED TWENTY-DAY PERIOD FOR NOT MORE THAN  SIXTY  DAYS.
WITHIN SEVEN DAYS AFTER DENYING AN APPLICATION, THE SUPERINTENDENT, IN A
RECORD, SHALL INFORM THE APPLICANT OF THE REASONS FOR THE DENIAL.
  2.  IF  THE SUPERINTENDENT DENIES AN APPLICATION FOR REGISTRATION AS A
PROVIDER OR DOES NOT ACT ON AN APPLICATION WITHIN THE TIME PRESCRIBED IN
SUBDIVISION ONE OF THIS SECTION, THE APPLICANT MAY APPEAL AND REQUEST  A
HEARING PURSUANT TO THE STATE ADMINISTRATIVE PROCEDURE ACT.
  3.  SUBJECT  TO  SUBDIVISION FOUR OF SECTION FIVE HUNDRED EIGHTY-ONE-B
AND SECTION FIVE HUNDRED EIGHT-SEVEN-A OF THIS ARTICLE,  A  REGISTRATION
AS A PROVIDER IS VALID FOR ONE YEAR.
  S  581-B. RENEWAL OF REGISTRATION. 1. A PROVIDER MUST OBTAIN A RENEWAL
OF ITS REGISTRATION ANNUALLY.
  2. AN APPLICATION FOR RENEWAL OF REGISTRATION AS A PROVIDER MUST BE IN
A FORM PRESCRIBED BY THE SUPERINTENDENT, SIGNED UNDER OATH, AND:
  (A) BE FILED NO FEWER THAN THIRTY AND NO MORE THAN SIXTY  DAYS  BEFORE
THE REGISTRATION EXPIRES;
  (B)  BE  ACCOMPANIED  BY THE FEE ESTABLISHED BY THE SUPERINTENDENT AND
THE BOND REQUIRED BY SECTION FIVE HUNDRED EIGHTY-TWO OF THIS ARTICLE;
  (C) CONTAIN THE MATTER REQUIRED FOR INITIAL REGISTRATION AS A PROVIDER
BY SUBDIVISIONS EIGHT AND NINE OF SECTION FIVE HUNDRED EIGHTY-A OF  THIS
ARTICLE  AND A FINANCIAL STATEMENT, AUDITED BY AN ACCOUNTANT LICENSED TO
CONDUCT AUDITS, FOR THE APPLICANT'S FISCAL  YEAR  IMMEDIATELY  PRECEDING
THE APPLICATION;
  (D)  DISCLOSE  ANY  CHANGES IN THE INFORMATION CONTAINED IN THE APPLI-
CANT'S APPLICATION FOR REGISTRATION OR ITS IMMEDIATELY PREVIOUS APPLICA-
TION FOR RENEWAL, AS APPLICABLE. IF AN APPLICATION IS OTHERWISE COMPLETE
AND THE APPLICANT HAS MADE A TIMELY EFFORT  TO  OBTAIN  THE  INFORMATION
REQUIRED  BY  SUBDIVISION  FOURTEEN  OF SECTION FIVE HUNDRED EIGHTY-A OF
THIS ARTICLE BUT THE INFORMATION HAS NOT BEEN RECEIVED, THE  SUPERINTEN-
DENT  MAY  ISSUE  A  TEMPORARY  RENEWAL  OF  REGISTRATION. THE TEMPORARY
RENEWAL SHALL EXPIRE NO LATER THAN ONE HUNDRED EIGHTY DAYS  AFTER  ISSU-
ANCE;
  (E)  SUPPLY  EVIDENCE OF INSURANCE IN AN AMOUNT EQUAL TO THE LARGER OF
TWO HUNDRED FIFTY THOUSAND DOLLARS OR THE HIGHEST DAILY BALANCE  IN  THE
TRUST  ACCOUNT  REQUIRED  BY  SECTION FIVE HUNDRED EIGHTY-FOUR-A OF THIS
ARTICLE DURING THE SIX-MONTH PERIOD IMMEDIATELY PRECEDING  THE  APPLICA-
TION:
  (I) AGAINST RISKS OF DISHONESTY, FRAUD, THEFT, AND OTHER MISCONDUCT ON
THE  PART  OF  THE  APPLICANT  OR  A DIRECTOR, EMPLOYEE, OR AGENT OF THE
APPLICANT;

S. 7067                             9

  (II) ISSUED BY AN INSURANCE COMPANY AUTHORIZED TO DO BUSINESS IN  THIS
STATE  AND  RATED  AT  LEAST  A OR EQUIVALENT BY A NATIONALLY RECOGNIZED
RATING ORGANIZATION APPROVED BY THE SUPERINTENDENT;
  (III) WITH A DEDUCTIBLE NOT EXCEEDING FIVE THOUSAND DOLLARS;
  (IV)  PAYABLE  FOR THE BENEFIT OF THE APPLICANT, THIS STATE, AND INDI-
VIDUALS WHO ARE RESIDENTS OF THIS STATE, AS THEIR INTERESTS MAY  APPEAR;
AND
  (V)  NOT SUBJECT TO CANCELLATION BY THE APPLICANT OR THE INSURER UNTIL
SIXTY DAYS AFTER WRITTEN NOTICE HAS BEEN GIVEN TO THE SUPERINTENDENT;
  (VI) DISCLOSE THE TOTAL AMOUNT OF  MONEY  RECEIVED  BY  THE  APPLICANT
PURSUANT  TO  PLANS DURING THE PRECEDING TWELVE MONTHS FROM OR ON BEHALF
OF INDIVIDUALS WHO RESIDE IN THIS STATE AND THE TOTAL  AMOUNT  OF  MONEY
DISTRIBUTED TO CREDITORS OF THOSE INDIVIDUALS DURING THAT PERIOD;
  (VII)  DISCLOSE,  TO  THE BEST OF THE APPLICANT'S KNOWLEDGE, THE GROSS
AMOUNT OF MONEY ACCUMULATED DURING THE PRECEDING TWELVE MONTHS  PURSUANT
TO  PLANS  BY  OR  ON BEHALF OF INDIVIDUALS WHO RESIDE IN THIS STATE AND
WITH WHOM THE APPLICANT HAS AGREEMENTS; AND
  (VIII) PROVIDE ANY OTHER INFORMATION THAT THE  SUPERINTENDENT  REASON-
ABLY REQUIRES TO PERFORM THE SUPERINTENDENT'S DUTIES UNDER THIS SECTION.
  3. EXCEPT FOR THE INFORMATION REQUIRED BY SUBDIVISIONS SEVEN, FOURTEEN
AND  SEVENTEEN  OF SECTION FIVE HUNDRED EIGHTY-A OF THIS ARTICLE AND THE
ADDRESSES REQUIRED BY SUBDIVISION FOUR OF SECTION FIVE HUNDRED  EIGHTY-A
OF  THIS  ARTICLE,  THE  SUPERINTENDENT SHALL MAKE THE INFORMATION IN AN
APPLICATION FOR RENEWAL OF REGISTRATION AS A PROVIDER AVAILABLE  TO  THE
PUBLIC.
  4.  IF  A  REGISTERED PROVIDER FILES A TIMELY AND COMPLETE APPLICATION
FOR RENEWAL OF REGISTRATION, THE REGISTRATION  REMAINS  EFFECTIVE  UNTIL
THE  SUPERINTENDENT, IN A RECORD, NOTIFIES THE APPLICANT OF A DENIAL AND
STATES THE REASONS FOR THE DENIAL.
  5. IF THE SUPERINTENDENT DENIES AN APPLICATION FOR RENEWAL  OF  REGIS-
TRATION AS A PROVIDER, THE APPLICANT, WITHIN THIRTY DAYS AFTER RECEIVING
NOTICE  OF  THE DENIAL, MAY APPEAL AND REQUEST A HEARING PURSUANT TO THE
STATE ADMINISTRATIVE PROCEDURE ACT.  SUBJECT  TO  SECTION  FIVE  HUNDRED
EIGHTY-SEVEN-A  OF  THIS ARTICLE, WHILE THE APPEAL IS PENDING THE APPLI-
CANT SHALL CONTINUE TO PROVIDE DEBT-MANAGEMENT SERVICES  TO  INDIVIDUALS
WITH  WHOM  IT HAS AGREEMENTS. IF THE DENIAL IS AFFIRMED, SUBJECT TO THE
SUPERINTENDENT'S ORDER AND SECTION FIVE HUNDRED EIGHTY-SEVEN-A  OF  THIS
ARTICLE,   THE  APPLICANT  SHALL  CONTINUE  TO  PROVIDE  DEBT-MANAGEMENT
SERVICES TO INDIVIDUALS WITH WHOM IT  HAS  AGREEMENTS  UNTIL,  WITH  THE
APPROVAL  OF  THE SUPERINTENDENT, IT TRANSFERS THE AGREEMENTS TO ANOTHER
REGISTERED PROVIDER OR RETURNS TO THE INDIVIDUALS ALL  UNEXPENDED  MONEY
THAT IS UNDER THE APPLICANT'S CONTROL.
  S  581-C. REGISTRATION IN ANOTHER STATE. IF A PROVIDER HOLDS A LICENSE
OR CERTIFICATE OF  REGISTRATION  IN  ANOTHER  STATE  AUTHORIZING  IT  TO
PROVIDE DEBT-MANAGEMENT SERVICES, THE PROVIDER MAY SUBMIT A COPY OF THAT
LICENSE OR CERTIFICATE AND THE APPLICATION FOR IT INSTEAD OF AN APPLICA-
TION IN THE FORM PRESCRIBED BY SECTION FIVE HUNDRED EIGHTY OF THIS ARTI-
CLE.  THE SUPERINTENDENT SHALL ACCEPT THE APPLICATION AND THE LICENSE OR
CERTIFICATE FROM THE OTHER STATE AS AN APPLICATION FOR REGISTRATION AS A
PROVIDER OR FOR RENEWAL OF REGISTRATION AS A PROVIDER,  AS  APPROPRIATE,
IN THIS STATE IF:
  1.  THE  APPLICATION  IN THE OTHER STATE CONTAINS INFORMATION SUBSTAN-
TIALLY SIMILAR TO OR MORE COMPREHENSIVE THAN THAT REQUIRED IN AN  APPLI-
CATION SUBMITTED IN THIS STATE;
  2.  THE  APPLICANT  PROVIDES  THE INFORMATION REQUIRED BY SECTION FIVE
HUNDRED EIGHTY-A OF THIS ARTICLE; AND

S. 7067                            10

  3. THE APPLICANT, UNDER OATH, CERTIFIES THAT THE INFORMATION CONTAINED
IN THE APPLICATION IS CURRENT OR, TO  THE  EXTENT  IT  IS  NOT  CURRENT,
SUPPLEMENTS THE APPLICATION TO MAKE THE INFORMATION CURRENT.
  S  582. BOND REQUIRED. 1. EXCEPT AS OTHERWISE PROVIDED IN SECTION FIVE
HUNDRED EIGHTY-TWO-A OF THIS ARTICLE, A PROVIDER THAT IS REQUIRED TO  BE
REGISTERED  UNDER  THIS ARTICLE SHALL FILE A SURETY BOND WITH THE SUPER-
INTENDENT, WHICH MUST:
  (A) BE IN EFFECT DURING THE PERIOD OF REGISTRATION AND FOR  TWO  YEARS
AFTER THE PROVIDER CEASES PROVIDING DEBT-MANAGEMENT SERVICES TO INDIVID-
UALS IN THIS STATE; AND
  (B) RUN TO THIS STATE FOR THE BENEFIT OF THIS STATE AND OF INDIVIDUALS
WHO  RESIDE  IN  THIS  STATE  WHEN THEY AGREE TO RECEIVE DEBT-MANAGEMENT
SERVICES FROM THE PROVIDER, AS THEIR INTERESTS MAY APPEAR.
  2. SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO  SUBDIVISION
SIX  OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, A SURETY BOND
FILED PURSUANT TO SUBDIVISION ONE MUST:
  (A) BE IN THE AMOUNT OF FIFTY THOUSAND  DOLLARS  OR  OTHER  LARGER  OR
SMALLER  AMOUNT  THAT  THE SUPERINTENDENT DETERMINES IS WARRANTED BY THE
FINANCIAL CONDITION AND BUSINESS EXPERIENCE OF THE PROVIDER, THE HISTORY
OF THE PROVIDER IN PERFORMING  DEBT-MANAGEMENT  SERVICES,  THE  RISK  TO
INDIVIDUALS, AND ANY OTHER FACTOR THE SUPERINTENDENT CONSIDERS APPROPRI-
ATE;
  (B) BE ISSUED BY A BONDING, SURETY, OR INSURANCE COMPANY AUTHORIZED TO
DO  BUSINESS  IN  THIS STATE AND RATED AT LEAST A BY A NATIONALLY RECOG-
NIZED RATING ORGANIZATION; AND
  (C) HAVE PAYMENT CONDITIONED UPON NONCOMPLIANCE OF THE PROVIDER OR ITS
AGENT WITH THIS ARTICLE.
  3. IF THE PRINCIPAL AMOUNT OF A SURETY BOND IS REDUCED BY PAYMENT OF A
CLAIM OR A JUDGMENT, THE PROVIDER SHALL IMMEDIATELY  NOTIFY  THE  SUPER-
INTENDENT  AND,  WITHIN  THIRTY DAYS AFTER NOTICE BY THE SUPERINTENDENT,
FILE A NEW OR ADDITIONAL SURETY BOND IN AN AMOUNT SET BY THE SUPERINTEN-
DENT. THE AMOUNT OF THE NEW OR ADDITIONAL BOND  MUST  BE  AT  LEAST  THE
AMOUNT  OF THE BOND IMMEDIATELY BEFORE PAYMENT OF THE CLAIM OR JUDGMENT.
IF FOR ANY REASON A SURETY TERMINATES A BOND, THE PROVIDER  SHALL  IMME-
DIATELY  FILE  A NEW SURETY BOND IN THE AMOUNT OF FIFTY THOUSAND DOLLARS
OR OTHER AMOUNT DETERMINED PURSUANT TO SUBDIVISION TWO OF THIS SECTION.
  4. THE SUPERINTENDENT OR AN INDIVIDUAL MAY OBTAIN SATISFACTION OUT  OF
THE SURETY BOND PROCURED PURSUANT TO THIS SECTION IF:
  (A) THE SUPERINTENDENT ASSESSES EXPENSES UNDER PARAGRAPH (B) OF SUBDI-
VISION  TWO OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, ISSUES
A FINAL ORDER UNDER PARAGRAPH (B) OF SUBDIVISION  ONE  OF  SECTION  FIVE
HUNDRED EIGHTY-SEVEN OF THIS ARTICLE, OR RECOVERS A FINAL JUDGMENT UNDER
PARAGRAPH  (D)  OR (E) OF SUBDIVISION ONE OR SUBDIVISION FOUR OF SECTION
FIVE HUNDRED EIGHTY-SEVEN OF THIS ARTICLE; OR
  (B) AN INDIVIDUAL RECOVERS A FINAL JUDGMENT  PURSUANT  TO  SUBDIVISION
ONE  OR TWO OR PARAGRAPH (A), (B) OR (D) OF SUBDIVISION THREE OF SECTION
FIVE HUNDRED EIGHTY-SEVEN-B OF THIS ARTICLE.
  5. IF CLAIMS AGAINST A SURETY BOND EXCEED OR ARE  REASONABLY  EXPECTED
TO  EXCEED THE AMOUNT OF THE BOND, THE SUPERINTENDENT, ON THE INITIATIVE
OF THE SUPERINTENDENT OR ON PETITION OF THE SURETY,  SHALL,  UNLESS  THE
PROCEEDS  ARE ADEQUATE TO PAY ALL COSTS, JUDGMENTS, AND CLAIMS, DISTRIB-
UTE THE PROCEEDS IN THE FOLLOWING ORDER:
  (A) TO SATISFACTION OF A FINAL ORDER OR JUDGMENT UNDER PARAGRAPH  (B),
(D)  OR  (E)  OF  SUBDIVISION  ONE  OR  SUBDIVISION FOUR OF SECTION FIVE
HUNDRED EIGHTY-SEVEN OF THIS ARTICLE;

S. 7067                            11

  (B) TO FINAL JUDGMENTS RECOVERED BY INDIVIDUALS PURSUANT  TO  SUBDIVI-
SION  ONE  OR  TWO  OR PARAGRAPH (A), (B) OR (D) OF SUBDIVISION THREE OF
SECTION FIVE HUNDRED EIGHTY-SEVEN-B OF THIS ARTICLE, PRO RATA;
  (C)  TO  CLAIMS  OF INDIVIDUALS ESTABLISHED TO THE SATISFACTION OF THE
SUPERINTENDENT, PRO RATA; AND
  (D) IF A FINAL ORDER OR JUDGMENT IS ISSUED UNDER  SUBDIVISION  ONE  OF
SECTION  FIVE  HUNDRED  EIGHTY-SEVEN  OF  THIS  ARTICLE, TO THE EXPENSES
CHARGED PURSUANT TO PARAGRAPH (A) OF SUBDIVISION  TWO  OF  SECTION  FIVE
HUNDRED EIGHTY-SIX-C OF THIS ARTICLE.
  S  582-A.  BOND  REQUIRED;  SUBSTITUTE.  1. INSTEAD OF THE SURETY BOND
REQUIRED BY SECTION FIVE HUNDRED EIGHTY-TWO OF THIS ARTICLE, A  PROVIDER
MAY DELIVER TO THE SUPERINTENDENT, IN THE AMOUNT REQUIRED BY SUBDIVISION
TWO  OF  SECTION FIVE HUNDRED EIGHTY-TWO OF THIS ARTICLE, AND, EXCEPT AS
OTHERWISE PROVIDED IN SUBPARAGRAPH (I) OF PARAGRAPH (B) OF THIS SUBDIVI-
SION, PAYABLE OR AVAILABLE TO THIS STATE AND TO INDIVIDUALS  WHO  RESIDE
IN  THIS  STATE WHEN THEY AGREE TO RECEIVE DEBT-MANAGEMENT SERVICES FROM
THE PROVIDER, AS THEIR INTERESTS MAY APPEAR,  IF  THE  PROVIDER  OR  ITS
AGENT DOES NOT COMPLY WITH THIS ARTICLE:
  (A) A CERTIFICATE OF INSURANCE
  (I)  ISSUED  BY AN INSURANCE COMPANY AUTHORIZED TO DO BUSINESS IN THIS
STATE AND RATED AT LEAST A OR  EQUIVALENT  BY  A  NATIONALLY  RECOGNIZED
RATING ORGANIZATION APPROVED BY THE SUPERINTENDENT; AND
  (II)  WITH  NO  DEDUCTIBLE,  OR IF THE PROVIDER SUPPLIES A BOND IN THE
AMOUNT OF FIVE THOUSAND DOLLARS, A DEDUCTIBLE NOT EXCEEDING  FIVE  THOU-
SAND DOLLARS; OR
  (B) WITH THE APPROVAL OF THE SUPERINTENDENT:
  (I)  AN  IRREVOCABLE  LETTER  OF CREDIT, ISSUED OR CONFIRMED BY A BANK
APPROVED BY THE SUPERINTENDENT, PAYABLE UPON PRESENTATION OF  A  CERTIF-
ICATE  BY  THE SUPERINTENDENT STATING THAT THE PROVIDER OR ITS AGENT HAS
NOT COMPLIED WITH THIS ARTICLE; OR
  (II) BONDS OR OTHER OBLIGATIONS OF THE UNITED STATES OR GUARANTEED  BY
THE UNITED STATES OR BONDS OR OTHER OBLIGATIONS OF THIS STATE OR A POLI-
TICAL  SUBDIVISION  OF THIS STATE, TO BE DEPOSITED AND MAINTAINED WITH A
BANK APPROVED BY THE SUPERINTENDENT FOR THIS PURPOSE.
  2. IF A PROVIDER FURNISHES A SUBSTITUTE PURSUANT TO SUBDIVISION ONE OF
THIS SECTION, THE PROVISIONS OF SUBDIVISIONS ONE, THREE, FOUR  AND  FIVE
OF  SECTION  FIVE  HUNDRED EIGHTY-TWO OF THIS ARTICLE SHALL APPLY TO THE
SUBSTITUTE.
  S 582-B. REQUIREMENT OF GOOD FAITH. A PROVIDER SHALL ACT IN GOOD FAITH
IN ALL MATTERS UNDER THIS ARTICLE.
  S 582-C. CUSTOMER SERVICE. A PROVIDER THAT IS REQUIRED  TO  BE  REGIS-
TERED  UNDER  THIS  ARTICLE  SHALL  MAINTAIN  A  TOLL-FREE COMMUNICATION
SYSTEM, STAFFED AT A LEVEL THAT  REASONABLY  PERMITS  AN  INDIVIDUAL  TO
SPEAK  TO A CERTIFIED COUNSELOR, CERTIFIED DEBT SPECIALIST, OR CUSTOMER-
SERVICE REPRESENTATIVE, AS APPROPRIATE, DURING ORDINARY BUSINESS HOURS.
  S 583. PREREQUISITES FOR PROVIDING DEBT-MANAGEMENT SERVICES. 1. BEFORE
PROVIDING DEBT-MANAGEMENT SERVICES, A REGISTERED PROVIDER SHALL GIVE THE
INDIVIDUAL AN ITEMIZED LIST OF GOODS AND SERVICES AND  THE  CHARGES  FOR
EACH.  THE  LIST MUST BE CLEAR AND CONSPICUOUS, BE IN A RECORD THE INDI-
VIDUAL MAY KEEP WHETHER OR NOT THE INDIVIDUAL ASSENTS TO  AN  AGREEMENT,
AND DESCRIBE THE GOODS AND SERVICES THE PROVIDER OFFERS:
  (A)  FREE OF ADDITIONAL CHARGE IF THE INDIVIDUAL ENTERS INTO AN AGREE-
MENT;
  (B) FOR A CHARGE IF THE INDIVIDUAL DOES NOT ENTER INTO  AN  AGREEMENT;
AND

S. 7067                            12

  (C) FOR A CHARGE IF THE INDIVIDUAL ENTERS INTO AN AGREEMENT, USING THE
FOLLOWING TERMINOLOGY, AS APPLICABLE, AND FORMAT:
  SET-UP FEE _____________________________________________________________
                              DOLLAR AMOUNT OF FEE
  MONTHLY SERVICE FEE ____________________________________________________
                      DOLLAR AMOUNT OF FEE OR METHOD OF DETERMINING AMOUNT
  SETTLEMENT FEE _________________________________________________________
                      DOLLAR AMOUNT OF FEE OR METHOD OF DETERMINING AMOUNT
  GOODS AND SERVICES IN ADDITION TO THOSE PROVIDED IN CONNECTION WITH A
PLAN:
________________________________________________________________________
           (ITEM) DOLLAR AMOUNT OR METHOD OF DETERMINING AMOUNT
________________________________________________________________________
           (ITEM) DOLLAR AMOUNT OR METHOD OF DETERMINING AMOUNT.
  2.  A  PROVIDER  MAY  NOT  FURNISH DEBT-MANAGEMENT SERVICES UNLESS THE
PROVIDER, THROUGH THE SERVICES OF A  CERTIFIED  COUNSELOR  OR  CERTIFIED
DEBT SPECIALIST:
  (A)  PROVIDES  THE  INDIVIDUAL  WITH  REASONABLE  EDUCATION  ABOUT THE
MANAGEMENT OF PERSONAL FINANCE;
  (B) HAS PREPARED A FINANCIAL ANALYSIS; AND
  (C) IF THE INDIVIDUAL IS TO MAKE REGULAR, PERIODIC PAYMENTS TO  CREDI-
TORS:
  (I) HAS PREPARED A PLAN FOR THE INDIVIDUAL;
  (II) HAS MADE A DETERMINATION, BASED ON THE PROVIDER'S ANALYSIS OF THE
INFORMATION  PROVIDED  BY  THE INDIVIDUAL AND OTHERWISE AVAILABLE TO IT,
THAT THE PLAN IS SUITABLE FOR THE INDIVIDUAL AND THE INDIVIDUAL WILL  BE
ABLE TO MEET THE PAYMENT OBLIGATIONS UNDER THE PLAN; AND
  (III)  BELIEVES  THAT  EACH  CREDITOR  OF  THE  INDIVIDUAL LISTED AS A
PARTICIPATING CREDITOR IN THE PLAN WILL ACCEPT PAYMENT OF  THE  INDIVID-
UAL'S DEBTS AS PROVIDED IN THE PLAN.
  3. BEFORE AN INDIVIDUAL ASSENTS TO AN AGREEMENT TO ENGAGE IN A PLAN, A
PROVIDER SHALL:
  (A)  PROVIDE  THE  INDIVIDUAL  WITH  A  COPY  OF THE ANALYSIS AND PLAN
REQUIRED BY SUBDIVISION TWO OF THIS SECTION IN A RECORD THAT  IDENTIFIES
THE  PROVIDER  AND THAT THE INDIVIDUAL MAY KEEP WHETHER OR NOT THE INDI-
VIDUAL ASSENTS TO THE AGREEMENT;
  (B) INFORM THE INDIVIDUAL OF THE  AVAILABILITY,  AT  THE  INDIVIDUAL'S
OPTION,  OF  ASSISTANCE BY A TOLL-FREE COMMUNICATION SYSTEM OR IN PERSON
TO DISCUSS THE FINANCIAL ANALYSIS AND PLAN REQUIRED BY  SUBDIVISION  TWO
OF THIS SECTION; AND
  (C)  IN PLANS THAT PROVIDE FOR REGULAR PERIODIC PAYMENTS TO CREDITORS,
WITH RESPECT TO ALL CREDITORS IDENTIFIED BY THE INDIVIDUAL OR  OTHERWISE
KNOWN  BY  THE  PROVIDER  TO BE CREDITORS OF THE INDIVIDUAL, PROVIDE THE
INDIVIDUAL WITH A LIST OF:
  (I) CREDITORS THAT THE PROVIDER EXPECTS TO PARTICIPATE IN THE PLAN AND
GRANT CONCESSIONS:
  (II) CREDITORS THAT THE PROVIDER EXPECTS TO PARTICIPATE  IN  THE  PLAN
BUT NOT GRANT CONCESSIONS;
  (III)  CREDITORS  THAT  THE PROVIDER EXPECTS NOT TO PARTICIPATE IN THE
PLAN; AND
  (IV) ALL OTHER CREDITORS.
  4. BEFORE AN INDIVIDUAL ASSENTS TO AN AGREEMENT,  THE  PROVIDER  SHALL
INFORM THE INDIVIDUAL, IN A SEPARATE RECORD THAT THE INDIVIDUAL MAY KEEP
WHETHER OR NOT THE INDIVIDUAL ASSENTS TO THE AGREEMENTS:
  (A) OF THE NAME AND BUSINESS ADDRESS OF THE PROVIDER;

S. 7067                            13

  (B) THAT PLANS ARE NOT SUITABLE FOR ALL INDIVIDUALS AND THE INDIVIDUAL
MAY  ASK  THE  PROVIDER  ABOUT OTHER WAYS, INCLUDING BANKRUPTCY, TO DEAL
WITH INDEBTEDNESS;
  (C) THAT ESTABLISHMENT OF A PLAN MAY ADVERSELY AFFECT THE INDIVIDUAL'S
CREDIT RATING OR CREDIT SCORES;
  (D) THAT NONPAYMENT OF DEBT MAY LEAD CREDITORS TO INCREASE FINANCE AND
OTHER CHARGES OR UNDERTAKE COLLECTION ACTIVITY, INCLUDING LITIGATION;
  (E)  UNLESS IT IS NOT TRUE, THAT THE PROVIDER MAY RECEIVE COMPENSATION
FROM THE CREDITORS OF THE INDIVIDUAL; AND
  (F) THAT, UNLESS THE INDIVIDUAL IS INSOLVENT, IF  A  CREDITOR  SETTLES
FOR  LESS  THAN  THE FULL AMOUNT OF THE DEBT, THE PLAN MAY RESULT IN THE
CREATION OF TAXABLE INCOME TO THE INDIVIDUAL, EVEN THOUGH THE INDIVIDUAL
DOES NOT RECEIVE ANY MONEY.
  5. IF A PROVIDER MAY RECEIVE PAYMENTS FROM AN  INDIVIDUAL'S  CREDITORS
AND  THE  PLAN  CONTEMPLATES THAT THE INDIVIDUAL'S CREDITORS WILL REDUCE
FINANCE CHARGES OR FEES FOR LATE PAYMENT, DEFAULT, OR  DELINQUENCY,  THE
PROVIDER  MAY  COMPLY WITH SUBDIVISION FOUR OF THIS SECTION BY PROVIDING
THE FOLLOWING DISCLOSURE, SURROUNDED BY BLACK LINES:
                IMPORTANT INFORMATION FOR YOU TO CONSIDER
  (A) DEBT-MANAGEMENT PLANS ARE NOT RIGHT FOR ALL INDIVIDUALS,  AND  YOU
MAY  ASK US TO PROVIDE INFORMATION ABOUT OTHER WAYS, INCLUDING BANKRUPT-
CY, TO DEAL WITH YOUR DEBTS.
  (B) USING A DEBT-MANAGEMENT PLAN MAY MAKE IT HARDER FOR YOU TO  OBTAIN
CREDIT.
  (C) WE MAY RECEIVE COMPENSATION FOR OUR SERVICES FROM YOUR CREDITORS.
  ______________________________________________________________________
                  NAME AND BUSINESS ADDRESS OF PROVIDER
  6. IF A PROVIDER WILL NOT RECEIVE PAYMENTS FROM AN INDIVIDUAL'S CREDI-
TORS  AND  THE  PLAN  CONTEMPLATES  THAT THE INDIVIDUAL'S CREDITORS WILL
REDUCE FINANCE CHARGES OR FEES FOR LATE PAYMENT, DEFAULT, OR  DELINQUEN-
CY,  A  PROVIDER  MAY  COMPLY  WITH  SUBDIVISION FOUR OF THIS SECTION BY
PROVIDING THE FOLLOWING DISCLOSURE, SURROUNDED BY BLACK LINES:
                IMPORTANT INFORMATION FOR YOU TO CONSIDER
  (A) DEBT-MANAGEMENT PLANS ARE NOT RIGHT FOR ALL INDIVIDUALS,  AND  YOU
MAY  ASK US TO PROVIDE INFORMATION ABOUT OTHER WAYS, INCLUDING BANKRUPT-
CY, TO DEAL WITH YOUR DEBTS.
  (B) USING A DEBT-MANAGEMENT PLAN MAY MAKE IT HARDER FOR YOU TO  OBTAIN
CREDIT.
_______________________________________________________________________
                  NAME AND BUSINESS ADDRESS OF PROVIDER
  7.  IF  AN AGREEMENT CONTEMPLATES THAT CREDITORS WILL SETTLE DEBTS FOR
LESS THAN THE FULL PRINCIPAL AMOUNT OF DEBT OWED, A PROVIDER MAY  COMPLY
WITH SUBDIVISION FOUR OF THIS SECTION BY PROVIDING THE FOLLOWING DISCLO-
SURE, SURROUNDED BY BLACK LINES:
                IMPORTANT INFORMATION FOR YOU TO CONSIDER
  (A)  OUR  PROGRAM IS NOT RIGHT FOR ALL INDIVIDUALS, AND YOU MAY ASK US
TO PROVIDE INFORMATION ABOUT BANKRUPTCY AND OTHER WAYS TO DEAL WITH YOUR
DEBTS.
  (B) NONPAYMENT OF YOUR DEBTS UNDER OUR PROGRAM MAY
  (I) HURT YOUR CREDIT RATING OR CREDIT SCORES;
  (II) LEAD YOUR CREDITORS TO INCREASE FINANCE AND OTHER CHARGES; AND
  (III) LEAD YOUR CREDITORS TO UNDERTAKE ACTIVITY,  INCLUDING  LAWSUITS,
TO COLLECT THE DEBTS.
  (C)  REDUCTION  OF DEBT UNDER OUR PROGRAM MAY RESULT IN TAXABLE INCOME
TO  YOU,  EVEN  THOUGH  YOU  WILL  NOT  ACTUALLY  RECEIVE   ANY   MONEY.
________________________________________________________________________

S. 7067                            14

                  NAME AND BUSINESS ADDRESS OF PROVIDER
  S  583-A.  COMMUNICATION  BY  ELECTRONIC  OR  OTHER  MEANS. 1. IN THIS
SECTION:
  (A) "FEDERAL ACT"  MEANS  THE  ELECTRONIC  SIGNATURES  IN  GLOBAL  AND
NATIONAL COMMERCE ACT, 15 U.S.C. SECTION 7001 ET SEQ., AS AMENDED.
  (B)  "CONSUMER"  MEANS  AN  INDIVIDUAL  WHO  SEEKS OR OBTAINS GOODS OR
SERVICES THAT ARE USED PRIMARILY  FOR  PERSONAL,  FAMILY,  OR  HOUSEHOLD
PURPOSES.
  2.  A  PROVIDER  MAY  SATISFY THE REQUIREMENTS OF SECTION FIVE HUNDRED
EIGHTY-THREE BY MEANS OF THE INTERNET OR OTHER ELECTRONIC MEANS  IF  THE
PROVIDER  OBTAINS A CONSUMER'S CONSENT IN THE MANNER PROVIDED BY SECTION
101(C)(1) OF THE FEDERAL ACT.
  3. THE DISCLOSURES AND MATERIALS  REQUIRED  BY  SECTION  FIVE  HUNDRED
EIGHTY-THREE-B,  OR  FIVE HUNDRED EIGHTY-FIVE-B OF THIS ARTICLE SHALL BE
PRESENTED IN A FORM THAT IS CAPABLE OF BEING ACCURATELY  REPRODUCED  FOR
LATER REFERENCE.
  4.  WITH  RESPECT  TO  DISCLOSURE BY MEANS OF AN INTERNET WEBSITE, THE
DISCLOSURE OF THE INFORMATION REQUIRED BY SUBDIVISION  FOUR  OF  SECTION
FIVE  HUNDRED  EIGHTY-THREE  OF  THIS ARTICLE MUST APPEAR ON ONE OR MORE
SCREENS THAT:
  (A) CONTAIN NO OTHER INFORMATION; AND
  (B) THE INDIVIDUAL MUST SEE BEFORE PROCEEDING TO ASSENT  TO  FORMATION
OF AN AGREEMENT.
  5.  AT  THE  TIME OF PROVIDING THE MATERIALS AND AGREEMENT REQUIRED BY
SUBDIVISION THREE OF SECTION FIVE HUNDRED EIGHTY-THREE, SUBDIVISION FOUR
OF  SECTION  FIVE  HUNDRED  EIGHTY-THREE-B  OR  SECTION   FIVE   HUNDRED
EIGHTY-FIVE-B  OF  THIS  ARTICLE, A PROVIDER SHALL INFORM THE INDIVIDUAL
THAT UPON ELECTRONIC, TELEPHONIC, OR WRITTEN REQUEST, IT WILL  SEND  THE
INDIVIDUAL  A  WRITTEN  COPY  OF  THE MATERIALS, AND SHALL COMPLY WITH A
REQUEST AS PROVIDED IN SUBDIVISION SIX OF THIS SECTION.
  6. IF A PROVIDER IS REQUESTED, BEFORE THE EXPIRATION  OF  NINETY  DAYS
AFTER AN AGREEMENT IS COMPLETED OR TERMINATED, TO SEND A WRITTEN COPY OF
THE  MATERIALS  REQUIRED  BY  SUBDIVISION  THREE OF SECTION FIVE HUNDRED
EIGHTY-THREE, SUBDIVISION FOUR OF SECTION FIVE HUNDRED EIGHTY-THREE-B OR
SECTION FIVE HUNDRED EIGHTY-FIVE-B OF THIS ARTICLE, THE  PROVIDER  SHALL
SEND  THEM  AT NO CHARGE WITHIN THREE BUSINESS DAYS AFTER THE REQUEST IS
RECEIVED, BUT THE PROVIDER NEED NOT COMPLY WITH A REQUEST MORE THAN ONCE
PER CALENDAR MONTH OR IF IT REASONABLY BELIEVES THE REQUEST IS MADE  FOR
PURPOSES  OF  HARASSMENT.  IF  A REQUEST IS   MADE MORE THAN NINETY DAYS
AFTER AN AGREEMENT IS COMPLETED OR TERMINATED, THE PROVIDER  SHALL  SEND
WITHIN A REASONABLE TIME A WRITTEN COPY OF THE MATERIALS REQUESTED.
  7. A PROVIDER THAT MAINTAINS AN INTERNET WEBSITE SHALL DISCLOSE ON THE
HOME  PAGE OF ITS WEBSITE OR ON A PAGE THAT IS CLEARLY AND CONSPICUOUSLY
CONNECTED TO THE HOME PAGE BY A LINK THAT CLEARLY REVEALS ITS CONTENTS:
  (A) ITS NAME AND ALL NAMES UNDER WHICH IT DOES BUSINESS;
  (B) ITS PRINCIPAL BUSINESS ADDRESS, TELEPHONE NUMBER, AND  ELECTRONIC-
MAIL ADDRESS, IF ANY; AND
  (C) THE NAMES OF ITS PRINCIPAL OFFICERS.
  8.  SUBJECT TO SUBDIVISION NINE OF THIS SECTION, IF A CONSUMER WHO HAS
CONSENTED TO ELECTRONIC COMMUNICATION IN THE MANNER PROVIDED BY  SECTION
101 OF THE FEDERAL ACT WITHDRAWS CONSENT AS PROVIDED IN THE FEDERAL ACT,
A PROVIDER MAY TERMINATE ITS AGREEMENT WITH THE CONSUMER.
  9.  IF  A  PROVIDER  WISHES  TO TERMINATE AN AGREEMENT WITH A CONSUMER
PURSUANT TO SUBDIVISION EIGHT OF  THIS  SECTION,  IT  SHALL  NOTIFY  THE
CONSUMER THAT IT WILL TERMINATE THE AGREEMENT UNLESS THE CONSUMER, WITH-
IN  THIRTY DAYS AFTER RECEIVING THE NOTIFICATION, CONSENTS TO ELECTRONIC

S. 7067                            15

COMMUNICATION IN THE MANNER PROVIDED IN SECTION 101(C)  OF  THE  FEDERAL
ACT.  IF THE CONSUMER CONSENTS, THE PROVIDER MAY TERMINATE THE AGREEMENT
ONLY  AS  PERMITTED  BY  SUBDIVISION  ONE  OF   SECTION   FIVE   HUNDRED
EIGHTY-THREE-B OF THIS ARTICLE.
  S 583-B. FORM AND CONTENTS OF AGREEMENT. 1. AN AGREEMENT MUST:
  (A) BE IN A RECORD;
  (B) BE DATED AND SIGNED BY THE PROVIDER AND THE INDIVIDUAL;
  (C) INCLUDE THE NAME OF THE INDIVIDUAL AND THE ADDRESS WHERE THE INDI-
VIDUAL RESIDES;
  (D)  INCLUDE  THE  NAME, BUSINESS ADDRESS, AND TELEPHONE NUMBER OF THE
PROVIDER;
  (E) BE DELIVERED TO THE INDIVIDUAL IMMEDIATELY UPON FORMATION  OF  THE
AGREEMENT; AND
  (F) DISCLOSE:
  (I) THE SERVICES TO BE PROVIDED;
  (II)  THE  AMOUNT,  OR  METHOD OF DETERMINING THE AMOUNT, OF ALL FEES,
INDIVIDUALLY ITEMIZED, TO BE PAID BY THE INDIVIDUAL;
  (III) THE SCHEDULE OF PAYMENTS TO BE MADE BY OR ON BEHALF OF THE INDI-
VIDUAL, INCLUDING THE AMOUNT OF EACH PAYMENT, THE  DATE  ON  WHICH  EACH
PAYMENT IS DUE, AND AN ESTIMATE OF THE DATE OF THE FINAL PAYMENT;
  (IV) IF A PLAN PROVIDES FOR REGULAR PERIODIC PAYMENTS TO CREDITORS:
  (A) EACH CREDITOR OF THE INDIVIDUAL TO WHICH PAYMENT WILL BE MADE, THE
AMOUNT  OWED  TO EACH CREDITOR, AND ANY CONCESSIONS THE PROVIDER REASON-
ABLY BELIEVES EACH CREDITOR WILL OFFER; AND
  (B) THE SCHEDULE OF EXPECTED PAYMENTS TO EACH CREDITOR, INCLUDING  THE
AMOUNT OF EACH PAYMENT AND THE DATE ON WHICH IT WILL BE MADE;
  (C)  EACH  CREDITOR THAT THE PROVIDER BELIEVES WILL NOT PARTICIPATE IN
THE PLAN AND TO WHICH THE PROVIDER WILL NOT DIRECT PAYMENT;
  (V) HOW THE PROVIDER WILL COMPLY WITH ITS OBLIGATIONS  UNDER  SUBDIVI-
SION ONE OF SECTION FIVE HUNDRED EIGHTY-FIVE-B OF THIS ARTICLE;
  (VI)  THAT  THE  PROVIDER  MAY TERMINATE THE AGREEMENT FOR GOOD CAUSE,
UPON RETURN OF UNEXPENDED MONEY HELD IN TRUST OF THE INDIVIDUAL;
  (VII) THAT THE INDIVIDUAL MAY CANCEL  THE  AGREEMENT  AS  PROVIDED  IN
SECTION FIVE HUNDRED EIGHTY-THREE-C OF THIS ARTICLE;
  (VIII)  THAT  THE  INDIVIDUAL  MAY CONTACT THE SUPERINTENDENT WITH ANY
QUESTIONS OR COMPLAINTS REGARDING THE PROVIDER; AND
  (IX) THE ADDRESS, TELEPHONE NUMBER, AND INTERNET ADDRESS OR WEBSITE OF
THE SUPERINTENDENT.
  2. FOR PURPOSES OF PARAGRAPH (E) OF SUBDIVISION ONE OF  THIS  SECTION,
DELIVERY  OF  AN ELECTRONIC RECORD OCCURS WHEN IT IS MADE AVAILABLE IN A
FORMAT IN WHICH THE INDIVIDUAL MAY RETRIEVE, SAVE, AND PRINT IT AND  THE
INDIVIDUAL IS NOTIFIED THAT IT IS AVAILABLE.
  3.  IF  THE  SUPERINTENDENT SUPPLIES THE PROVIDER WITH ANY INFORMATION
REQUIRED UNDER SUBPARAGRAPH (IX) OF PARAGRAPH (F) OF SUBDIVISION ONE  OF
THIS  SECTION,  THE  PROVIDER  MAY  COMPLY WITH THAT REQUIREMENT ONLY BY
DISCLOSING THE INFORMATION SUPPLIED BY THE SUPERINTENDENT.
  4. AN AGREEMENT MUST PROVIDE THAT:
  (A) THE INDIVIDUAL HAS A RIGHT TO TERMINATE THE AGREEMENT AT ANY TIME,
WITHOUT PENALTY OR OBLIGATION, BY GIVING THE PROVIDER WRITTEN  OR  ELEC-
TRONIC NOTICE, IN WHICH EVENT:
  (I)  THE  PROVIDER WILL REFUND ALL UNEXPENDED MONEY HELD IN TRUST THAT
THE PROVIDER OR ITS AGENT HAS RECEIVED FROM OR ON BEHALF OF THE INDIVID-
UAL FOR THE REDUCTION OR SATISFACTION OF THE INDIVIDUAL'S DEBT;
  (II) WITH RESPECT TO AN AGREEMENT  THAT  CONTEMPLATES  THAT  CREDITORS
WILL  SETTLE  DEBTS  FOR  LESS  THAN  THE  PRINCIPAL AMOUNT OF DEBT, THE

S. 7067                            16

PROVIDER WILL REFUND SIXTY-FIVE PERCENT OF ANY PORTION OF THE SET-UP FEE
THAT HAS NOT BEEN CREDITED AGAINST THE SETTLEMENT FEE; AND
  (III) ALL POWERS OF ATTORNEY GRANTED BY THE INDIVIDUAL TO THE PROVIDER
ARE REVOKED AND INEFFECTIVE;
  (B)  THE  INDIVIDUAL  AUTHORIZES ANY BANK IN WHICH THE PROVIDER OR ITS
AGENT HAS ESTABLISHED A TRUST ACCOUNT TO DISCLOSE TO THE  SUPERINTENDENT
ANY FINANCIAL RECORDS RELATING TO THE TRUST ACCOUNT; AND
  (C)  THE  PROVIDER  WILL  NOTIFY THE INDIVIDUAL WITHIN FIVE DAYS AFTER
LEARNING OF A CREDITOR'S FINAL DECISION TO REJECT  OR  WITHDRAW  FROM  A
PLAN AND THAT THIS NOTICE WILL INCLUDE:
  (I) THE IDENTITY OF THE CREDITOR; AND
  (II) THE RIGHT OF THE INDIVIDUAL TO MODIFY OR TERMINATE THE AGREEMENT.
  5. AN AGREEMENT MAY CONFER ON A PROVIDER A POWER OF ATTORNEY TO SETTLE
THE  INDIVIDUAL'S DEBT FOR NO MORE THAN FIFTY PERCENT OF THE OUTSTANDING
AMOUNT OF THE DEBT. AN AGREEMENT MAY NOT CONFER A POWER OF  ATTORNEY  TO
SETTLE A DEBT FOR MORE THAN FIFTY PERCENT OF THAT AMOUNT, BUT MAY CONFER
A  POWER  OF  ATTORNEY  TO NEGOTIATE WITH CREDITORS OF THE INDIVIDUAL ON
BEHALF OF THE INDIVIDUAL.  AN AGREEMENT MUST PROVIDE THAT  THE  PROVIDER
WILL  OBTAIN  THE ASSENT OF THE INDIVIDUAL AFTER A CREDITOR HAS ASSENTED
TO A SETTLEMENT FOR MORE THAN FIFTY PERCENT OF THE OUTSTANDING AMOUNT OF
THE DEBT.
  6. AN AGREEMENT MAY NOT:
  (A) PROVIDE FOR APPLICATION OF THE LAW OF ANY JURISDICTION OTHER  THAN
THE UNITED STATES AND THIS STATE;
  (B) EXCEPT AS PERMITTED BY SECTION 2 OF THE FEDERAL ARBITRATION ACT, 9
U.S.C. SECTION 2, AS AMENDED, OR ARTICLE SEVENTY-FIVE OF THE CIVIL PRAC-
TICE LAW AND RULES CONTAIN A PROVISION THAT MODIFIES OR LIMITS OTHERWISE
AVAILABLE  FORUMS  OR PROCEDURAL RIGHTS, INCLUDING THE RIGHT TO TRIAL BY
JURY, THAT ARE GENERALLY AVAILABLE TO THE  INDIVIDUAL  UNDER  LAW  OTHER
THAN THIS ARTICLE;
  (C) CONTAIN A PROVISION THAT RESTRICTS THE INDIVIDUAL'S REMEDIES UNDER
THIS ARTICLE OR LAW OTHER THAN THIS ARTICLE; OR
  (D) CONTAIN A PROVISION THAT:
  (I)  LIMITS OR RELEASES THE LIABILITY OF ANY PERSON FOR NOT PERFORMING
THE AGREEMENT OR FOR VIOLATING THIS ARTICLE; OR
  (II) INDEMNIFIES ANY PERSON FOR LIABILITY ARISING UNDER THE  AGREEMENT
OR THIS ARTICLE.
  7.  ALL  RIGHTS  AND OBLIGATIONS SPECIFIED IN SUBDIVISION FOUR OF THIS
SECTION AND SECTION FIVE HUNDRED EIGHTY-THREE-C OF  THIS  ARTICLE  EXIST
EVEN IF NOT PROVIDED IN THE AGREEMENT. A PROVISION IN AN AGREEMENT WHICH
VIOLATES SUBDIVISION FOUR, FIVE OR SIX OF THIS SECTION IS VOID.
  S  583-C.  CANCELLATION  OF  AGREEMENT;  WAIVER.  1. AN INDIVIDUAL MAY
CANCEL AN AGREEMENT BEFORE MIDNIGHT OF THE THIRD BUSINESS DAY AFTER  THE
INDIVIDUAL  ASSENTS  TO  IT,  UNLESS  THE AGREEMENT DOES NOT COMPLY WITH
SUBDIVISION TWO OF THIS SECTION OR SECTION FIVE  HUNDRED  EIGHTY-THREE-B
OR  FIVE HUNDRED EIGHTY-FIVE-C OF THIS ARTICLE, IN WHICH EVENT THE INDI-
VIDUAL MAY CANCEL THE AGREEMENT WITHIN THIRTY DAYS AFTER THE  INDIVIDUAL
ASSENTS TO IT. TO EXERCISE THE RIGHT TO CANCEL, THE INDIVIDUAL MUST GIVE
NOTICE IN A RECORD TO THE PROVIDER. NOTICE BY MAIL IS GIVEN WHEN MAILED.
  2.  AN  AGREEMENT  MUST  BE  ACCOMPANIED  BY  A  FORM THAT CONTAINS IN
BOLD-FACE TYPE, SURROUNDED BY BOLD BLACK LINES:

                        NOTICE OF RIGHT TO CANCEL

S. 7067                            17

  YOU MAY CANCEL THIS AGREEMENT, WITHOUT ANY PENALTY OR  OBLIGATION,  AT
ANY  TIME  BEFORE MIDNIGHT OF THE THIRD BUSINESS DAY THAT BEGINS THE DAY
AFTER YOU AGREE TO IT BY ELECTRONIC COMMUNICATION OR BY SIGNING IT.
  TO  CANCEL  THIS  AGREEMENT  DURING  THIS  PERIOD,  SEND  AN E-MAIL TO
___________________________ OR MAIL OR DELIVER A SIGNED, DATED  COPY  OF
THIS
  E-MAIL ADDRESS OF PROVIDER
  NOTICE, OR ANY OTHER WRITTEN NOTICE TO
  ___________________
                                                        NAME OF PROVIDER
AT  ______________________________________________  BEFORE  MIDNIGHT  ON
___________________________.
  ADDRESS OF PROVIDER DATE
  IF YOU CANCEL THIS AGREEMENT WITHIN THE 3-DAY PERIOD, WE  WILL  REFUND
ALL MONEY YOU ALREADY HAVE PAID US.
  YOU  ALSO  MAY  TERMINATE THIS AGREEMENT AT ANY LATER TIME, BUT WE MAY
NOT BE REQUIRED TO REFUND FEES YOU HAVE PAID US.
  I CANCEL THIS AGREEMENT,
____________________________________________
       PRINT YOUR NAME
____________________________________________
       SIGNATURE
____________________________________________
       DATE
  3. IF A PERSONAL FINANCIAL EMERGENCY NECESSITATES THE DISBURSEMENT  OF
AN  INDIVIDUAL'S  MONEY  TO  ONE  OR  MORE OF THE INDIVIDUAL'S CREDITORS
BEFORE THE EXPIRATION OF THREE DAYS AFTER AN  AGREEMENT  IS  SIGNED,  AN
INDIVIDUAL  MAY WAIVE THE RIGHT TO CANCEL. TO WAIVE THE RIGHT, THE INDI-
VIDUAL MUST SEND OR DELIVER A SIGNED, DATED STATEMENT  IN  THE  INDIVID-
UAL'S  OWN WORDS DESCRIBING THE CIRCUMSTANCES THAT NECESSITATE A WAIVER.
THE WAIVER MUST EXPLICITLY WAIVE THE RIGHT TO CANCEL. A WAIVER BY  MEANS
OF A STANDARD-FORM RECORD IS VOID.
  S 584. REQUIRED LANGUAGE. UNLESS THE SUPERINTENDENT, BY RULE, PROVIDES
OTHERWISE,  THE  DISCLOSURES AND DOCUMENTS REQUIRED BY THIS ARTICLE MUST
BE IN ENGLISH. IF A PROVIDER COMMUNICATES WITH AN  INDIVIDUAL  PRIMARILY
IN  A  LANGUAGE  OTHER  THAN ENGLISH, THE PROVIDER MUST FURNISH A TRANS-
LATION INTO THE OTHER LANGUAGE OF THE DISCLOSURES AND DOCUMENTS REQUIRED
BY THIS ARTICLE.
  S 584-A. TRUST ACCOUNT. 1. ALL MONEY PAID  TO  A  PROVIDER  BY  OR  ON
BEHALF OF AN INDIVIDUAL FOR DISTRIBUTION TO CREDITORS PURSUANT TO A PLAN
IS  HELD  IN TRUST. WITHIN TWO BUSINESS DAYS AFTER RECEIPT, THE PROVIDER
SHALL DEPOSIT THE MONEY IN A TRUST ACCOUNT ESTABLISHED FOR  THE  BENEFIT
OF  INDIVIDUALS  TO  WHOM  THE  PROVIDER  IS  FURNISHING DEBT-MANAGEMENT
SERVICES.
  2. MONEY HELD IN TRUST BY A PROVIDER IS NOT PROPERTY OF  THE  PROVIDER
OR ITS DESIGNEE. THE MONEY IS NOT AVAILABLE TO CREDITORS OF THE PROVIDER
OR  DESIGNEE,  EXCEPT  AN  INDIVIDUAL  FROM  WHOM OR ON WHOSE BEHALF THE
PROVIDER RECEIVED MONEY, TO THE EXTENT  THAT  THE  MONEY  HAS  NOT  BEEN
DISBURSED TO CREDITORS OF THE INDIVIDUAL.
  3. A PROVIDER SHALL:
  (A)  MAINTAIN  SEPARATE RECORDS OF ACCOUNT FOR EACH INDIVIDUAL TO WHOM
THE PROVIDER IS FURNISHING DEBT-MANAGEMENT SERVICES;
  (B) DISBURSE MONEY PAID BY OR ON BEHALF OF THE INDIVIDUAL TO CREDITORS
OF THE INDIVIDUAL AS DISCLOSED IN THE AGREEMENT, EXCEPT THAT:
  (I) THE PROVIDER MAY DELAY PAYMENT TO THE EXTENT THAT A PAYMENT BY THE
INDIVIDUAL IS NOT FINAL; AND

S. 7067                            18

  (II) IF A PLAN PROVIDES FOR REGULAR PERIODIC  PAYMENTS  TO  CREDITORS,
THE  DISBURSEMENT  MUST  COMPLY  WITH  THE DUE DATES ESTABLISHED BY EACH
CREDITOR; AND
  (C) PROMPTLY CORRECT ANY PAYMENTS THAT ARE NOT MADE OR THAT ARE MISDI-
RECTED  AS  A  RESULT  OF  AN  ERROR  BY THE PROVIDER OR OTHER PERSON IN
CONTROL OF THE TRUST ACCOUNT AND REIMBURSE THE INDIVIDUAL FOR ANY  COSTS
OR  FEES  IMPOSED  BY  A  CREDITOR  AS A RESULT OF THE FAILURE TO PAY OR
MISDIRECTION.
  4. A PROVIDER MAY NOT COMMINGLE MONEY IN A TRUST  ACCOUNT  ESTABLISHED
FOR  THE BENEFIT OF INDIVIDUALS TO WHOM THE PROVIDER IS FURNISHING DEBT-
MANAGEMENT SERVICES WITH MONEY OF OTHER PERSONS.
  5. A TRUST ACCOUNT MUST AT ALL TIMES HAVE A CASH BALANCE EQUAL TO  THE
SUM OF THE BALANCES OF EACH INDIVIDUAL'S ACCOUNT.
  6.  IF A PROVIDER HAS ESTABLISHED A TRUST ACCOUNT PURSUANT TO SUBDIVI-
SION ONE OF THIS SECTION, THE PROVIDER SHALL RECONCILE THE TRUST ACCOUNT
AT LEAST ONCE A MONTH. THE RECONCILIATION MUST COMPARE THE CASH  BALANCE
IN  THE  TRUST ACCOUNT WITH THE SUM OF THE BALANCES IN EACH INDIVIDUAL'S
ACCOUNT. IF THE PROVIDER  OR  ITS  DESIGNEE  HAS  MORE  THAN  ONE  TRUST
ACCOUNT, EACH TRUST ACCOUNT MUST BE INDIVIDUALLY RECONCILED.
  7.  IF  A PROVIDER DISCOVERS, OR HAS A REASONABLE SUSPICION OF, EMBEZ-
ZLEMENT OR OTHER UNLAWFUL APPROPRIATION OF  MONEY  HELD  IN  TRUST,  THE
PROVIDER  IMMEDIATELY  SHALL  NOTIFY  THE  SUPERINTENDENT  BY  A  METHOD
APPROVED BY  THE  SUPERINTENDENT.  UNLESS  THE  SUPERINTENDENT  BY  RULE
PROVIDES OTHERWISE, WITHIN FIVE DAYS THEREAFTER, THE PROVIDER SHALL GIVE
NOTICE  TO THE SUPERINTENDENT DESCRIBING THE REMEDIAL ACTION TAKEN OR TO
BE TAKEN.
  8. IF AN INDIVIDUAL TERMINATES AN AGREEMENT OR IT  BECOMES  REASONABLY
APPARENT  TO  A  PROVIDER  THAT  A  PLAN  HAS FAILED, THE PROVIDER SHALL
PROMPTLY REFUND TO THE INDIVIDUAL ALL MONEY PAID BY OR ON BEHALF OF  THE
INDIVIDUAL  WHICH  HAS  NOT  BEEN  PAID TO CREDITORS, LESS FEES THAT ARE
PAYABLE TO THE PROVIDER UNDER SECTION FIVE HUNDRED EIGHTY-FOUR-B OF THIS
ARTICLE.
  9. BEFORE RELOCATING A TRUST ACCOUNT  FROM  ONE  BANK  TO  ANOTHER,  A
PROVIDER  SHALL INFORM THE SUPERINTENDENT OF THE NAME, BUSINESS ADDRESS,
AND TELEPHONE NUMBER OF THE  NEW  BANK.  AS  SOON  AS  PRACTICABLE,  THE
PROVIDER  SHALL  INFORM  THE SUPERINTENDENT OF THE ACCOUNT NUMBER OF THE
TRUST ACCOUNT AT THE NEW BANK.
  S 584-B. FEES AND OTHER CHARGES. 1. A PROVIDER MAY NOT IMPOSE DIRECTLY
OR INDIRECTLY A FEE OR OTHER CHARGE ON AN INDIVIDUAL  OR  RECEIVE  MONEY
FROM  OR  ON BEHALF OF AN INDIVIDUAL FOR DEBT-MANAGEMENT SERVICES EXCEPT
AS PERMITTED BY THIS SECTION.
  2. A PROVIDER MAY NOT IMPOSE CHARGES OR RECEIVE PAYMENT FOR  DEBT-MAN-
AGEMENT  SERVICES  UNTIL  THE  PROVIDER AND THE INDIVIDUAL HAS SIGNED AN
AGREEMENT THAT COMPLIES WITH SECTIONS FIVE  HUNDRED  EIGHTY-THREE-B  AND
FIVE HUNDRED EIGHTY-FIVE-B OF THIS ARTICLE.
  3. IF AN INDIVIDUAL ASSENTS TO AN AGREEMENT, A PROVIDER MAY NOT IMPOSE
A  FEE  OR  OTHER  CHARGE FOR EDUCATIONAL OR COUNSELING SERVICES, OR THE
LIKE, EXCEPT AS OTHERWISE PROVIDED IN THIS SUBDIVISION  AND  SUBDIVISION
FOUR  OF  THIS SECTION.   THE SUPERINTENDENT MAY AUTHORIZE A PROVIDER TO
CHARGE A FEE BASED ON THE NATURE AND EXTENT OF THE EDUCATIONAL OR  COUN-
SELING SERVICES FURNISHED BY THE PROVIDER.
  4. SUBJECT TO ADJUSTMENT OF DOLLAR AMOUNTS PURSUANT TO SUBDIVISION SIX
OF  SECTION  FIVE  HUNDRED  EIGHTY-SIX-C  OF THIS ARTICLE, THE FOLLOWING
RULES APPLY:

S. 7067                            19

  (A) IF AN INDIVIDUAL ASSENTS TO A PLAN THAT CONTEMPLATES  THAT  CREDI-
TORS  WILL  REDUCE FINANCE CHARGES OR FEES FOR LATE PAYMENT, DEFAULT, OR
DELINQUENCY, THE PROVIDER MAY CHARGE:
  (I)  A  FEE  NOT EXCEEDING FIFTY DOLLARS FOR CONSULTATION, OBTAINING A
CREDIT REPORT, SETTING UP AN ACCOUNT, AND THE LIKE; AND
  (II) A MONTHLY SERVICE FEE, NOT TO EXCEED TEN DOLLARS TIMES THE NUMBER
OF CREDITORS REMAINING IN A PLAN AT THE TIME THE FEE  IS  ASSESSED,  BUT
NOT MORE THAN FIFTY DOLLARS IN ANY MONTH.
  (B)  IF  AN  INDIVIDUAL ASSENTS TO AN AGREEMENT THAT CONTEMPLATES THAT
CREDITORS WILL SETTLE DEBTS FOR LESS THAN THE PRINCIPAL  AMOUNT  OF  THE
DEBT, A PROVIDER MAY CHARGE:
  (I) SUBJECT TO SUBDIVISION FOUR OF SECTION FIVE HUNDRED EIGHTY-THREE-B
OF  THIS  ARTICLE,  A  FEE  FOR CONSULTATION, OBTAINING A CREDIT REPORT,
SETTING UP AN ACCOUNT, AND THE LIKE, IN AN  AMOUNT  NOT  EXCEEDING  FOUR
PERCENT  OF THE DEBT IN THE PLAN AT THE INCEPTION OF THE PLAN THE AMOUNT
OF WHICH SHALL BE ASSESSED IN NO FEWER THAN FOUR EQUAL MONTHLY  INSTALL-
MENTS; AND
  (II) A MONTHLY SERVICE FEE, NOT TO EXCEED TEN DOLLARS TIMES THE NUMBER
OF  CREDITORS  REMAINING  IN A PLAN AT THE TIME THE FEE IS ASSESSED, BUT
NOT MORE THAN FIFTY DOLLARS IN ANY MONTH.
  (C) A PROVIDER MAY NOT IMPOSE OR RECEIVE FEES  UNDER  BOTH  PARAGRAPHS
(A) AND (B) OF THIS SUBDIVISION.
  (D) EXCEPT AS OTHERWISE PROVIDED IN THIS SUBDIVISION, IF AN INDIVIDUAL
DOES  NOT ASSENT TO AN AGREEMENT, A PROVIDER MAY RECEIVE FOR EDUCATIONAL
AND COUNSELING SERVICES IT PROVIDES TO THE INDIVIDUAL A FEE NOT  EXCEED-
ING  ONE  HUNDRED DOLLARS OR, WITH THE APPROVAL OF THE SUPERINTENDENT, A
LARGER FEE. THE SUPERINTENDENT MAY APPROVE A FEE LARGER THAN ONE HUNDRED
DOLLARS IF THE NATURE AND  EXTENT  OF  THE  EDUCATIONAL  AND  COUNSELING
SERVICES WARRANT THE LARGER FEE.
  5.  IF,  BEFORE  THE EXPIRATION OF NINETY DAYS AFTER THE COMPLETION OR
TERMINATION OF EDUCATIONAL OR COUNSELING SERVICES, AN INDIVIDUAL ASSENTS
TO AN AGREEMENT, THE PROVIDER SHALL REFUND TO  THE  INDIVIDUAL  ANY  FEE
PAID PURSUANT TO PARAGRAPH (D) OF SUBDIVISION FOUR OF THIS SECTION.
  6. EXCEPT AS OTHERWISE PROVIDED IN SUBDIVISIONS THREE AND FOUR OF THIS
SECTION,  IF  AN  AGREEMENT  CONTEMPLATES  THAT CREDITORS WILL SETTLE AN
INDIVIDUAL'S DEBTS FOR LESS THAN  THE  PRINCIPAL  AMOUNT  OF  THE  DEBT,
COMPENSATION  FOR  SERVICES  IN  CONNECTION WITH SETTLING A DEBT MAY NOT
EXCEED THE FOLLOWING APPLICABLE SETTLEMENT  FEE  LIMITS,  THE  TERMS  OF
WHICH  SHALL BE CLEARLY DISCLOSED IN THE AGREEMENT, PROVIDED, HOWEVER, A
PROVIDER MAY NOT IMPOSE OR RECEIVE FEES UNDER BOTH  PARAGRAPHS  (A)  AND
(B) OF THIS SUBDIVISION:
  (A)  WITH RESPECT TO AGREEMENTS WHERE A FLAT SETTLEMENT FEE IS CHARGED
BASED ON THE OVERALL AMOUNT OF INCLUDED DEBT, THE TOTAL AGGREGATE AMOUNT
OF FEES CHARGED TO ANY INDIVIDUAL UNDER  THIS  ARTICLE,  INCLUDING  FEES
CHARGED UNDER SUBPARAGRAPHS (I) AND (II) OF PARAGRAPH (B) OF SUBDIVISION
FOUR  OF THIS SECTION, MAY NOT EXCEED SEVENTEEN PERCENT OF THE PRINCIPAL
AMOUNT OF DEBT. THE FLAT SETTLEMENT FEE AUTHORIZED  UNDER  THIS  SECTION
SHALL  BE  ASSESSED  IN EQUAL MONTHLY PAYMENTS OVER NO LESS THAN HALF OF
THE LENGTH OF THE PLAN, AS ESTIMATED AT THE PLAN'S INCEPTION, UNLESS:
  (I) VOLUNTARILY ACCELERATED BY THE INDIVIDUAL IN A SEPARATE RECORD; OR
  (II) AT LEAST HALF OF THE OUTSTANDING DEBT INCLUDED IN  THE  AGREEMENT
HAS BEEN SETTLED; AND
  (B) WITH RESPECT TO AGREEMENTS WHERE FEES ARE CALCULATED AS A PERCENT-
AGE  OF  THE  AMOUNT  SAVED  BY  AN INDIVIDUAL, A SETTLEMENT FEE MAY NOT
EXCEED THIRTY PERCENT OF THE EXCESS OF THE OUTSTANDING  AMOUNT  OF  EACH
DEBT OVER THE AMOUNT ACTUALLY PAID TO THE CREDITOR, AS CALCULATED AT THE

S. 7067                            20

TIME  OF  SETTLEMENT.  SETTLEMENT FEES AUTHORIZED UNDER THIS SUBDIVISION
SHALL BECOME BILLABLE ONLY AS DEBTS ARE SETTLED, AND THE TOTAL AGGREGATE
AMOUNT OF FEES CHARGED TO ANY INDIVIDUAL UNDER THIS  SECTION,  INCLUDING
FEES CHARGED UNDER SUBPARAGRAPHS (I) AND (II) OF PARAGRAPH (B) OF SUBDI-
VISION  FOUR OF THIS SECTION, MAY NOT EXCEED TWENTY PERCENT OF THE PRIN-
CIPAL AMOUNT OF DEBT INCLUDED IN THE AGREEMENT AT THE AGREEMENT'S INCEP-
TION.
  7. SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO  SUBDIVISION
SIX  OF  SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, IF A PAYMENT
TO A PROVIDER BY AN INDIVIDUAL  UNDER  THIS  ARTICLE  IS  DISHONORED,  A
PROVIDER MAY IMPOSE A REASONABLE CHARGE ON THE INDIVIDUAL, NOT TO EXCEED
THE  LESSER OF TWENTY-FIVE DOLLARS AND THE AMOUNT PERMITTED BY LAW OTHER
THAN THIS ARTICLE.
  S 584-C. VOLUNTARY CONTRIBUTIONS. A PROVIDER MAY NOT SOLICIT A  VOLUN-
TARY  CONTRIBUTION  FROM AN INDIVIDUAL OR AN AFFILIATE OF THE INDIVIDUAL
FOR ANY SERVICE PROVIDED TO THE INDIVIDUAL. A PROVIDER MAY ACCEPT VOLUN-
TARY CONTRIBUTIONS FROM AN  INDIVIDUAL  BUT,  UNTIL  THIRTY  DAYS  AFTER
COMPLETION  OR  TERMINATION  OF  A  PLAN,  THE AGGREGATE AMOUNT OF MONEY
RECEIVED FROM OR ON BEHALF OF THE INDIVIDUAL MAY NOT  EXCEED  THE  TOTAL
AMOUNT THE PROVIDER MAY CHARGE THE INDIVIDUAL UNDER SECTION FIVE HUNDRED
EIGHTY-FOUR-B OF THIS ARTICLE.
  S  585.  VOIDABLE  AGREEMENTS. 1. IF A PROVIDER IMPOSED A FEE OR OTHER
CHARGE OR RECEIVES MONEY OR OTHER PAYMENTS  NOT  AUTHORIZED  BY  SECTION
FIVE  HUNDRED  EIGHTY-FOUR-B OR FIVE HUNDRED EIGHTY-FOUR-C OF THIS ARTI-
CLE, THE INDIVIDUAL MAY VOID THE AGREEMENT AND RECOVER  AS  PROVIDED  IN
SECTION FIVE HUNDRED EIGHTY-SEVEN-B OF THIS ARTICLE.
  2. IF A PROVIDER IS NOT REGISTERED AS REQUIRED BY THIS ARTICLE WHEN AN
INDIVIDUAL  ASSENTS  TO  AN  AGREEMENT, THE AGREEMENT IS VOIDABLE BY THE
INDIVIDUAL.
  3. IF AN INDIVIDUAL IS NOT REGISTERED UNDER SUBDIVISION THREE OF  THIS
SECTION,  THE  PROVIDER DOES NOT HAVE A CLAIM AGAINST THE INDIVIDUAL FOR
BREACH OF CONTRACT OR FOR RESTITUTION.
  S 585-A. TERMINATION OF AGREEMENT. 1. IF AN INDIVIDUAL WHO HAS ENTERED
INTO AN AGREEMENT FAILS FOR SIXTY DAYS TO MAKE PAYMENTS REQUIRED BY  THE
AGREEMENT, A PROVIDER MAY TERMINATE THE AGREEMENT.
  2. IF A PROVIDER OR AN INDIVIDUAL TERMINATES AN AGREEMENT, THE PROVID-
ER SHALL IMMEDIATELY RETURN TO THE INDIVIDUAL:
  (A)  ANY  MONEY OF THE INDIVIDUAL HELD IN TRUST FOR THE BENEFIT OF THE
INDIVIDUAL; AND
  (B) SIXTY-FIVE PERCENT OF ANY  PORTION  OF  THE  SET-UP  FEE  RECEIVED
PURSUANT  TO  PARAGRAPH  (B) OF SUBDIVISION FOUR OF SECTION FIVE HUNDRED
EIGHT-FOUR-B WHICH HAS NOT BEEN CREDITED AGAINST SETTLEMENT FEES.
  S 585-B. PERIODIC REPORTS AND RETENTION  OF  RECORDS.  1.  A  PROVIDER
SHALL  PROVIDE  THE  ACCOUNTING  REQUIRED  BY  SUBDIVISION  TWO  OF THIS
SECTION:
  (A) UPON CANCELLATION OR TERMINATION OF AN AGREEMENT; AND
  (B) BEFORE CANCELLATION OR TERMINATION OF ANY AGREEMENT:
  (I) AT LEAST ONCE EACH MONTH; AND
  (II) WITHIN FIVE BUSINESS DAYS AFTER A REQUEST BY AN  INDIVIDUAL,  BUT
THE  PROVIDER NEED NOT COMPLY WITH MORE THAN ONE REQUEST IN ANY CALENDAR
MONTH.
  2. A PROVIDER, IN A RECORD, SHALL PROVIDE EACH INDIVIDUAL FOR WHOM  IT
HAS ESTABLISHED A PLAN AN ACCOUNTING OF THE FOLLOWING INFORMATION:
  (A)  THE  AMOUNT  OF MONEY RECEIVED FROM THE INDIVIDUAL SINCE THE LAST
REPORT;

S. 7067                            21

  (B) THE AMOUNTS AND DATES OF DISBURSEMENT  MADE  ON  THE  INDIVIDUAL'S
BEHALF,  OR  BY THE INDIVIDUAL UPON THE DIRECTION OF THE PROVIDER, SINCE
THE LAST REPORT TO EACH CREDITOR LISTED IN THE PLAN;
  (C) THE AMOUNT DEDUCTED FROM THE AMOUNT RECEIVED FROM THE INDIVIDUAL;
  (D) THE AMOUNT HELD IN RESERVE; AND
  (E)  IF,  SINCE  THE  LAST  REPORT, A CREDITOR HAS AGREED TO ACCEPT AS
PAYMENT IN FULL AN AMOUNT LESS THAN THE PRINCIPAL  AMOUNT  OF  THE  DEBT
OWED BY THE INDIVIDUAL:
  (I) THE TOTAL AMOUNT AND TERMS OF THE SETTLEMENT;
  (II) THE AMOUNT OF THE DEBT WHEN THE INDIVIDUAL ASSENTED TO THE PLAN;
  (III)  THE  AMOUNT OF THE DEBT WHEN THE CREDITOR AGREED TO THE SETTLE-
MENT; AND
  (IV) THE CALCULATION OF A SETTLEMENT FEE.
  3. A PROVIDER SHALL MAINTAIN RECORDS FOR EACH INDIVIDUAL FOR  WHOM  IT
PROVIDES DEBT-MANAGEMENT SERVICES FOR FIVE YEARS AFTER THE FINAL PAYMENT
MADE  BY  THE  INDIVIDUAL  AND  PRODUCE A COPY OF THEM TO THE INDIVIDUAL
WITHIN A REASONABLE TIME AFTER A REQUEST FOR THEM. THE PROVIDER MAY  USE
ELECTRONIC OR OTHER MEANS OF STORAGE OF THE RECORDS.
  S 585-C. PROHIBITED ACTS AND PRACTICES. 1. A PROVIDER MAY NOT, DIRECT-
LY OR INDIRECTLY:
  (A) MISAPPROPRIATE OR MISAPPLY MONEY HELD IN TRUST;
  (B)  SETTLE  A  DEBT  ON  BEHALF  OF AN INDIVIDUAL FOR MORE THAN FIFTY
PERCENT OF THE OUTSTANDING AMOUNT OF THE DEBT OWED  A  CREDITOR,  UNLESS
THE  INDIVIDUAL ASSENTS TO THE SETTLEMENT AFTER THE CREDITOR HAS ASSENT-
ED;
  (C) TAKE A POWER OF ATTORNEY THAT AUTHORIZES  IT  TO  SETTLE  A  DEBT,
UNLESS  THE  POWER OF ATTORNEY EXPRESSLY LIMITS THE PROVIDER'S AUTHORITY
TO SETTLE DEBTS FOR NOT MORE  THAN  FIFTY  PERCENT  OF  THE  OUTSTANDING
AMOUNT OF THE DEBT OWED A CREDITOR;
  (D) EXERCISE OR ATTEMPT TO EXERCISE A POWER OF ATTORNEY AFTER AN INDI-
VIDUAL HAS TERMINATED AN AGREEMENT;
  (E) INITIATE A TRANSFER FROM AN INDIVIDUAL'S ACCOUNT AT A BANK OR WITH
ANOTHER PERSON UNLESS THE TRANSFER IS:
  (I) A RETURN OF MONEY TO THE INDIVIDUAL; OR
  (II)  BEFORE  TERMINATION  OF AN AGREEMENT, PROPERLY AUTHORIZED BY THE
AGREEMENT AND THIS ARTICLE, AND FOR:
  (A) PAYMENT TO ONE OR MORE CREDITORS PURSUANT TO AN AGREEMENT; OR
  (B) PAYMENT OF A FEE;
  (F) OFFER A GIFT OR BONUS, PREMIUM, REWARD, OR OTHER  COMPENSATION  TO
AN INDIVIDUAL FOR EXECUTING AN AGREEMENT;
  (G)  OFFER,  PAY,  OR  GIVE A GIFT OR BONUS, PREMIUM, REWARD, OR OTHER
COMPENSATION TO A PERSON FOR REFERRING A PROSPECTIVE  CUSTOMER,  IF  THE
PERSON  MAKING  THE  REFERRAL HAS A FINANCIAL INTEREST IN THE OUTCOME OF
DEBT-MANAGEMENT SERVICES PROVIDED TO THE CUSTOMER,  UNLESS  NEITHER  THE
PROVIDER NOR THE PERSON MAKING THE REFERRAL COMMUNICATES TO THE PROSPEC-
TIVE CUSTOMER THE IDENTITY OF THE SOURCE OF THE REFERRAL;
  (H)  RECEIVE  A  BONUS,  COMMISSION, OR OTHER BENEFIT FOR REFERRING AN
INDIVIDUAL TO A PERSON;
  (I) STRUCTURE A PLAN IN A MANNER THAT WOULD RESULT IN A NEGATIVE AMOR-
TIZATION OF ANY OF AN INDIVIDUAL'S DEBTS, UNLESS A CREDITOR THAT IS OWED
A NEGATIVELY AMORTIZING DEBT AGREES  TO  REFUND  OR  WAIVE  THE  FINANCE
CHARGE UPON PAYMENT OF THE PRINCIPAL AMOUNT OF THE DEBT;
  (J)  COMPENSATE  ITS EMPLOYEES ON THE BASIS OF A FORMULA THAT INCORPO-
RATES THE NUMBER OF INDIVIDUALS  THE  EMPLOYEE  INDUCES  TO  ENTER  INTO
AGREEMENTS;

S. 7067                            22

  (K) SETTLE A DEBT OR LEAD AN INDIVIDUAL TO BELIEVE THAT A PAYMENT TO A
CREDITOR  IS IN SETTLEMENT OF A DEBT TO THE CREDITOR UNLESS, AT THE TIME
OF SETTLEMENT, THE INDIVIDUAL RECEIVES A CERTIFICATION BY  THE  CREDITOR
THAT  THE  PAYMENT  IS  IN  FULL  SETTLEMENT OF THE DEBT OR IS PART OF A
PAYMENT PLAN, THE TERMS OF WHICH ARE INCLUDED IN THE CERTIFICATION, THAT
UPON COMPLETION, WILL LEAD TO FULL SETTLEMENT OF THE DEBT;
  (1) MAKE A REPRESENTATION THAT:
  (I)  THE  PROVIDER  WILL FURNISH MONEY TO PAY BILLS OR PREVENT ATTACH-
MENTS;
  (II) PAYMENT OF A CERTAIN AMOUNT WILL PERMIT SATISFACTION OF A CERTAIN
AMOUNT OR RANGE OF INDEBTEDNESS; OR
  (III) PARTICIPATION IN A PLAN WILL OR MAY PREVENT LITIGATION, GARNISH-
MENT,  ATTACHMENT,  REPOSSESSION,  FORECLOSURE,  EVICTION,  OR  LOSS  OF
EMPLOYMENT;
  (M)  MISREPRESENT  THAT IT IS AUTHORIZED OR COMPETENT TO FURNISH LEGAL
ADVICE OR PERFORM LEGAL SERVICES;
  (N) REPRESENT IN ITS AGREEMENTS, DISCLOSURES REQUIRED BY THIS ARTICLE,
ADVERTISEMENTS, OR INTERNET WEBSITE THAT IT IS
  (I) A NOT-FOR-PROFIT ENTITY UNLESS IT IS ORGANIZED AND PROPERLY  OPER-
ATING  AS A NOT-FOR-PROFIT ENTITY UNDER THE LAW OF THE STATE IN WHICH IT
WAS FORMED; OR
  (II) A TAX-EXEMPT ENTITY UNLESS IT HAS RECEIVED CERTIFICATION OF  TAX-
EXEMPT  STATUS FROM THE INTERNAL REVENUE SERVICE AND IS PROPERLY OPERAT-
ING AS A NOT-FOR-PROFIT ENTITY UNDER THE LAW OF THE STATE  IN  WHICH  IT
WAS FORMED;
  (O)  TAKE  A  CONFESSION  OF  JUDGMENT OR POWER OF ATTORNEY TO CONFESS
JUDGMENT AGAINST AN INDIVIDUAL; OR
  (P) EMPLOY AN UNFAIR, UNCONSCIONABLE, OR DECEPTIVE  ACT  OR  PRACTICE,
INCLUDING THE KNOWING OMISSION OF ANY MATERIAL INFORMATION.
  2.  IF A PROVIDER FURNISHES DEBT-MANAGEMENT SERVICES TO AN INDIVIDUAL,
THE PROVIDER MAY NOT, DIRECTLY OR INDIRECTLY:
  (A) PURCHASE A DEBT OR OBLIGATION OF THE INDIVIDUAL;
  (B) RECEIVE FROM OR ON BEHALF OF THE INDIVIDUAL:
  (I) A PROMISSORY NOTE OR OTHER  NEGOTIABLE  INSTRUMENT  OTHER  THAN  A
CHECK OR A DEMAND DRAFT; OR
  (II) A POST-DATED CHECK OR DEMAND DRAFT;
  (C) LEND MONEY OR PROVIDE CREDIT TO THE INDIVIDUAL, EXCEPT AS A DEFER-
RAL OF A SETTLEMENT FEE AT NO ADDITIONAL EXPENSE TO THE INDIVIDUAL;
  (D)  OBTAIN  A  MORTGAGE OR OTHER SECURITY INTEREST FROM ANY PERSON IN
CONNECTION WITH THE SERVICES PROVIDED TO THE INDIVIDUAL;
  (E) EXCEPT AS PERMITTED BY FEDERAL LAW, DISCLOSE THE IDENTITY OR IDEN-
TIFYING INFORMATION OF THE INDIVIDUAL OR THE IDENTITY  OF  THE  INDIVID-
UAL'S CREDITORS, EXCEPT TO:
  (I) THE SUPERINTENDENT, UPON PROPER DEMAND;
  (II)  A  CREDITOR OF THE INDIVIDUAL, TO THE EXTENT NECESSARY TO SECURE
THE COOPERATION OF THE CREDITOR IN A PLAN; OR
  (III) THE EXTENT NECESSARY TO ADMINISTER THE PLAN;
  (F) EXCEPT AS OTHERWISE PROVIDED IN SUBDIVISION SIX  OF  SECTION  FIVE
HUNDRED  EIGHTY-FOUR-B OF THIS ARTICLE, PROVIDE THE INDIVIDUAL LESS THAN
THE FULL BENEFIT OF A COMPROMISE OF A DEBT ARRANGED BY THE PROVIDER;
  (G) CHARGE THE INDIVIDUAL FOR OR PROVIDE CREDIT  OR  OTHER  INSURANCE,
COUPONS FOR GOODS OR SERVICES, MEMBERSHIP IN A CLUB, ACCESS TO COMPUTERS
OR  THE  INTERNET, OR ANY OTHER MATTER NOT DIRECTLY RELATED TO DEBT-MAN-
AGEMENT SERVICES OR EDUCATIONAL SERVICES CONCERNING PERSONAL FINANCE; OR

S. 7067                            23

  (H) FURNISH LEGAL ADVICE OR PERFORM LEGAL SERVICES, UNLESS THE  PERSON
FURNISHING  THAT ADVICE TO OR PERFORMING THOSE SERVICES FOR THE INDIVID-
UAL IS LICENSED TO PRACTICE LAW.
  3.  THIS  ARTICLE DOES NOT AUTHORIZE ANY PERSON TO ENGAGE IN THE PRAC-
TICE OF LAW.
  4. A PROVIDER MAY NOT RECEIVE A GIFT OR  BONUS,  PREMIUM,  REWARD,  OR
OTHER  COMPENSATION, DIRECTLY OR INDIRECTLY, FOR ADVISING, ARRANGING, OR
ASSISTING AN INDIVIDUAL IN CONNECTION WITH OBTAINING,  AN  EXTENSION  OF
CREDIT  UNRELATED  TO THE DEBT MANAGEMENT SERVICES FROM A LENDER, EXCEPT
FOR EDUCATIONAL OR COUNSELING SERVICES REQUIRED  IN  CONNECTION  WITH  A
GOVERNMENT-SPONSORED PROGRAM.
  5.  UNLESS  A PERSON SUPPLIES GOODS, SERVICES, OR FACILITIES GENERALLY
AND SUPPLIES THEM TO THE PROVIDER AT A COST NO GREATER THAN THE COST THE
PERSON GENERALLY CHARGES TO OTHERS, A PROVIDER MAY NOT  PURCHASE  GOODS,
SERVICES,  OR FACILITIES FROM THE PERSON IF AN EMPLOYEE OR A PERSON THAT
THE PROVIDER SHOULD REASONABLY KNOW IS AN AFFILIATE OF THE PROVIDER:
  (A) OWNS MORE THAN TEN PERCENT OF THE PERSON; OR
  (B) IS AN EMPLOYEE OR AFFILIATE OF THE PERSON.
  S 586. NOTICE OF LITIGATION. NO LATER THAN THIRTY DAYS AFTER A PROVID-
ER HAS BEEN SERVED WITH NOTICE OF A CIVIL ACTION FOR VIOLATION  OF  THIS
ARTICLE  BY  OR  ON BEHALF OF AN INDIVIDUAL WHO RESIDES IN THIS STATE AT
EITHER THE TIME OF AN AGREEMENT OR AT THE TIME THE NOTICE IS SERVED, THE
PROVIDER SHALL NOTIFY THE SUPERINTENDENT IN A RECORD THAT  IT  HAS  BEEN
SUED.
  S  586-A.  ADVERTISING. 1. IF THE AGREEMENTS OF A PROVIDER CONTEMPLATE
THAT CREDITORS WILL REDUCE FINANCE CHARGES OR  FEES  FOR  LATE  PAYMENT,
DEFAULT,  OR  DELINQUENCY  AND  THE  PROVIDER ADVERTISES DEBT-MANAGEMENT
SERVICES, IT SHALL DISCLOSE, IN AN EASILY  COMPREHENSIBLE  MANNER,  THAT
USING  A  DEBT-MANAGEMENT  PLAN MAY MAKE IT HARDER FOR THE INDIVIDUAL TO
OBTAIN CREDIT.
  2. IF THE AGREEMENTS OF A PROVIDER  CONTEMPLATE  THAT  CREDITORS  WILL
SETTLE  FOR LESS THAN THE FULL PRINCIPAL AMOUNT OF DEBT AND THE PROVIDER
ADVERTISES DEBT-MANAGEMENT SERVICES, IT SHALL  DISCLOSE,  IN  AN  EASILY
COMPREHENSIBLE  MANNER,  THE INFORMATION SPECIFIED IN PARAGRAPHS (C) AND
(D) OF SUBDIVISION FOUR OF SECTION FIVE  HUNDRED  EIGHTY-THREE  OF  THIS
ARTICLE.
  S  586-B.  LIABILITY  FOR  THE CONDUCT OF OTHER PERSONS. IF A PROVIDER
DELEGATES ANY OF ITS DUTIES OR OBLIGATIONS UNDER AN  AGREEMENT  OR  THIS
ARTICLE  TO  A  THIRD  PARTY,  INCLUDING  AN INDEPENDENT CONTRACTOR, THE
PROVIDER IS LIABLE FOR CONDUCT OF THE  PERSON  WHICH,  IF  DONE  BY  THE
PROVIDER, WOULD VIOLATE THE AGREEMENT OR THIS ARTICLE.
  S  586-C.  POWERS  OF SUPERINTENDENT. 1. THE SUPERINTENDENT MAY ACT ON
HIS OR HER OWN INITIATIVE OR IN RESPONSE TO COMPLAINTS AND  MAY  RECEIVE
COMPLAINTS,  TAKE  ACTION TO OBTAIN VOLUNTARY COMPLIANCE WITH THIS ARTI-
CLE, REFER CASES TO THE ATTORNEY GENERAL, AND SEEK OR  PROVIDE  REMEDIES
AS PROVIDED IN THIS ARTICLE.
  2.  THE  SUPERINTENDENT  MAY INVESTIGATE AND EXAMINE, IN THIS STATE OR
ELSEWHERE, BY SUBPOENA OR OTHERWISE, THE  ACTIVITIES,  BOOKS,  ACCOUNTS,
AND  RECORDS OF A PERSON THAT PROVIDES OR OFFERS TO PROVIDE DEBT-MANAGE-
MENT SERVICES, OR A PERSON TO WHICH A PROVIDER HAS DELEGATED  ITS  OBLI-
GATIONS UNDER AN AGREEMENT OR THIS ARTICLE, TO DETERMINE COMPLIANCE WITH
THIS  ARTICLE.  INFORMATION  THAT IDENTIFIES INDIVIDUALS WHO HAVE AGREE-
MENTS WITH THE PROVIDER  SHALL  NOT  BE  DISCLOSED  TO  THE  PUBLIC.  IN
CONNECTION WITH THE INVESTIGATION, THE SUPERINTENDENT MAY:
  (A)  CHARGE THE PERSON THE REASONABLE EXPENSES NECESSARILY INCURRED TO
CONDUCT THE EXAMINATION;

S. 7067                            24

  (B) REQUIRE OR PERMIT A PERSON TO FILE A STATEMENT UNDER  OATH  AS  TO
ALL THE FACTS AND CIRCUMSTANCES OF A MATTER TO BE INVESTIGATED; AND
  (C)  SEEK  A  COURT ORDER AUTHORIZING SEIZURE FROM A BANK AT WHICH THE
PERSON MAINTAINS A TRUST ACCOUNT REQUIRED BY SECTION FIVE HUNDRED EIGHT-
Y-FOUR-A OF THIS ARTICLE, ANY OR ALL MONEY,  BOOKS,  RECORDS,  ACCOUNTS,
AND  OTHER  PROPERTY  OF THE PROVIDER THAT IS IN THE CONTROL OF THE BANK
AND RELATES TO INDIVIDUALS WHO RESIDE IN THIS STATE.
  3. THE SUPERINTENDENT MAY ADOPT RULES TO IMPLEMENT THE  PROVISIONS  OF
THIS ARTICLE IN ACCORDANCE WITH THE STATE ADMINISTRATIVE PROCEDURE ACT.
  4. THE SUPERINTENDENT MAY ENTER INTO COOPERATIVE ARRANGEMENTS WITH ANY
OTHER  FEDERAL  OR  STATE AGENCY HAVING AUTHORITY OVER PROVIDERS AND MAY
EXCHANGE WITH ANY  OF  THOSE  AGENCIES  INFORMATION  ABOUT  A  PROVIDER,
INCLUDING INFORMATION OBTAINED DURING AN EXAMINATION OF THE PROVIDER.
  5.  THE SUPERINTENDENT, BY RULE, SHALL ESTABLISH REASONABLE FEES TO BE
PAID BY PROVIDERS FOR THE EXPENSE OF ADMINISTERING THIS ARTICLE.
  6. THE SUPERINTENDENT, BY RULE, SHALL ADOPT DOLLAR AMOUNTS INSTEAD  OF
THOSE  SPECIFIED  IN  SECTIONS FIVE HUNDRED SEVENTY-NINE-A, FIVE HUNDRED
EIGHTY, FIVE HUNDRED EIGHTY-ONE, FIVE HUNDRED EIGHTY-TWO,  FIVE  HUNDRED
EIGHTY-SEVEN, AND FIVE HUNDRED EIGHTY-SEVEN-B OF THIS ARTICLE TO REFLECT
INFLATION,  AS  MEASURED BY THE UNITED STATES BUREAU OF LABOR STATISTICS
CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS OR, IF THAT  INDEX  IS  NOT
AVAILABLE,  ANOTHER  INDEX  ADOPTED  BY  RULE BY THE SUPERINTENDENT. THE
SUPERINTENDENT SHALL ADOPT A BASE YEAR AND ADJUST  THE  DOLLAR  AMOUNTS,
EFFECTIVE  ON  JULY  FIRST OF EACH YEAR, IF THE CHANGE IN THE INDEX FROM
THE BASE YEAR, AS OF DECEMBER THIRTY-FIRST OF THE PRECEDING YEAR, IS  AT
LEAST TEN PERCENT.  THE DOLLAR AMOUNT MUST BE ROUNDED TO THE NEAREST ONE
HUNDRED  DOLLARS, EXCEPT THAT THE AMOUNTS IN SECTION FIVE HUNDRED EIGHT-
Y-FOUR-B OF THIS ARTICLE MUST BE ROUNDED TO THE NEAREST DOLLAR.
  7. THE SUPERINTENDENT SHALL NOTIFY REGISTERED PROVIDERS OF ANY  CHANGE
IN  DOLLAR  AMOUNTS MADE PURSUANT TO SUBDIVISION SIX OF THIS SECTION AND
MAKE THAT INFORMATION AVAILABLE TO THE PUBLIC.
  S 587. ADMINISTRATIVE REMEDIES. 1. THE SUPERINTENDENT MAY ENFORCE THIS
ARTICLE AND RULES ADOPTED UNDER THIS ARTICLE BY TAKING ONE  OR  MORE  OF
THE FOLLOWING ACTIONS:
  (A)  ORDERING  A PROVIDER OR A DIRECTOR, EMPLOYEE, OR OTHER AGENT OF A
PROVIDER TO CEASE AND DESIST FROM ANY VIOLATIONS;
  (B) ORDERING A PROVIDER OR A PERSON THAT HAS  CAUSED  A  VIOLATION  TO
CORRECT THE VIOLATION, INCLUDING MAKING RESTITUTION OF MONEY OR PROPERTY
TO A PERSON AGGRIEVED BY A VIOLATION;
  (C) SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO SUBDIVISION
SIX  OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE, IMPOSING ON A
PROVIDER OR A PERSON THAT HAS CAUSED A VIOLATION  A  CIVIL  PENALTY  NOT
EXCEEDING TEN THOUSAND DOLLARS FOR EACH VIOLATION;
  (D) PROSECUTING A CIVIL ACTION TO:
  (I) ENFORCE AN ORDER;
  (II) OBTAIN RESTITUTION OR AN INJUNCTION OR OTHER EQUITABLE RELIEF, OR
BOTH; OR
  (E) INTERVENING IN AN ACTION BROUGHT UNDER SECTION FIVE HUNDRED EIGHT-
Y-SEVEN-B OF THIS ARTICLE.
  2.  SUBJECT TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO SUBDIVISION
SIX OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE,  IF  A  PERSON
VIOLATES OR KNOWINGLY AUTHORIZES, DIRECTS, OR AIDS IN THE VIOLATION OF A
FINAL ORDER ISSUED UNDER PARAGRAPH (A) OR (B) OF SUBDIVISION ONE OF THIS
SECTION,  THE  SUPERINTENDENT  MAY  IMPOSE A CIVIL PENALTY NOT EXCEEDING
TWENTY THOUSAND DOLLARS FOR EACH VIOLATION.

S. 7067                            25

  3. THE SUPERINTENDENT MAY MAINTAIN AN ACTION TO ENFORCE  THIS  ARTICLE
IN ANY COUNTY.
  4.  THE  SUPERINTENDENT  MAY RECOVER THE REASONABLE COSTS OF ENFORCING
THIS ARTICLE UNDER SUBDIVISIONS  ONE  THROUGH  THREE  OF  THIS  SECTION,
INCLUDING ATTORNEY'S FEES BASED ON THE HOURS REASONABLY EXPENDED AND THE
HOURLY RATES FOR ATTORNEYS OF COMPARABLE EXPERIENCE IN THE COMMUNITY.
  5. IN DETERMINING THE AMOUNT OF A CIVIL PENALTY TO IMPOSE UNDER SUBDI-
VISION ONE OR TWO OF THIS SECTION, THE SUPERINTENDENT SHALL CONSIDER THE
SERIOUSNESS OF THE VIOLATION, THE GOOD FAITH OF THE VIOLATOR, ANY PREVI-
OUS  VIOLATIONS BY THE VIOLATOR, THE DELETERIOUS EFFECT OF THE VIOLATION
ON THE PUBLIC, THE NET WORTH OF THE VIOLATOR, AND ANY OTHER  FACTOR  THE
SUPERINTENDENT  CONSIDERS  RELEVANT  TO  THE  DETERMINATION OF THE CIVIL
PENALTY.
  S 587-A. SUSPENSION, REVOCATION, OR NONRENEWAL OF REGISTRATION. 1.  IN
THIS SECTION, "INSOLVENT" MEANS:
  (A)  HAVING  GENERALLY  CEASED  TO PAY DEBTS IN THE ORDINARY COURSE OF
BUSINESS OTHER THAN AS A RESULT OF GOOD-FAITH DISPUTE;
  (B) BEING UNABLE TO PAY DEBTS AS THEY BECOME DUE; OR
  (C) BEING INSOLVENT WITHIN THE MEANING OF THE FEDERAL BANKRUPTCY  LAW,
11 U.S.C. SECTION 101 ET SEQ., AS AMENDED.
  2.  THE  SUPERINTENDENT  MAY  SUSPEND,  REVOKE,  OR  DENY RENEWAL OF A
PROVIDER'S REGISTRATION IF:
  (A) A FACT OR CONDITION EXISTS THAT, IF IT HAD EXISTED WHEN THE REGIS-
TRANT APPLIED FOR REGISTRATION AS A PROVIDER, WOULD HAVE BEEN  A  REASON
FOR DENYING REGISTRATION;
  (B) THE PROVIDER HAS COMMITTED A MATERIAL VIOLATION OF THIS ARTICLE OR
A RULE OR ORDER OF THE SUPERINTENDENT UNDER THIS ARTICLE;
  (C) THE PROVIDER IS INSOLVENT;
  (D)  THE  PROVIDER  OR  AN  EMPLOYEE  OR AFFILIATE OF THE PROVIDER HAS
REFUSED TO PERMIT THE SUPERINTENDENT TO MAKE AN  EXAMINATION  AUTHORIZED
BY  THIS ARTICLE, FAILED TO COMPLY WITH PARAGRAPH (B) OF SUBDIVISION TWO
OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE WITHIN FIFTEEN DAYS
AFTER REQUEST, OR MADE  A  MATERIAL  MISREPRESENTATION  OR  OMISSION  IN
COMPLYING  WITH PARAGRAPH (B) OF SUBDIVISION TWO OF SECTION FIVE HUNDRED
EIGHTY-SIX-C OF THIS ARTICLE; OR
  (E) THE PROVIDER HAS NOT RESPONDED WITHIN A REASONABLE TIME AND IN  AN
APPROPRIATE MANNER TO COMMUNICATIONS FROM THE SUPERINTENDENT.
  3.  IF A PROVIDER DOES NOT COMPLY WITH SUBDIVISION SIX OF SECTION FIVE
HUNDRED EIGHTY-FOUR-A OF THIS ARTICLE OR IF THE SUPERINTENDENT OTHERWISE
FINDS THAT THE PUBLIC HEALTH OR SAFETY OR GENERAL WELFARE REQUIRES EMER-
GENCY  ACTION,  THE SUPERINTENDENT MAY ORDER A SUMMARY SUSPENSION OF THE
PROVIDER'S REGISTRATION, EFFECTIVE ON THE DATE SPECIFIED IN THE ORDER.
  4. IF THE SUPERINTENDENT SUSPENDS, REVOKES, OR DENIES RENEWAL  OF  THE
REGISTRATION  OF  A  PROVIDER, THE SUPERINTENDENT MAY SEEK A COURT ORDER
AUTHORIZING SEIZURE OF ANY OR ALL  OF  THE  MONEY  IN  A  TRUST  ACCOUNT
REQUIRED  BY  SECTION FIVE HUNDRED EIGHTY-FOUR-A OF THIS ARTICLE, BOOKS,
RECORDS, ACCOUNTS, AND OTHER PROPERTY OF THE PROVIDER WHICH ARE  LOCATED
IN THIS STATE.
  5.  IF  THE  SUPERINTENDENT SUSPENDS OR REVOKES A PROVIDER'S REGISTRA-
TION, THE PROVIDER MAY APPEAL AND REQUEST A HEARING IN  ACCORDANCE  WITH
THE PROVISIONS OF THE STATE ADMINISTRATIVE PROCEDURE ACT.
  S  587-B.  PRIVATE ENFORCEMENT. 1. IF AN INDIVIDUAL VOIDS AN AGREEMENT
PURSUANT TO SUBDIVISION TWO OF SECTION FIVE HUNDRED EIGHTY-FIVE OF  THIS
ARTICLE,  THE INDIVIDUAL MAY RECOVER IN A CIVIL ACTION ALL MONEY PAID OR
DEPOSITED BY OR ON BEHALF OF THE INDIVIDUAL PURSUANT TO  THE  AGREEMENT,

S. 7067                            26

EXCEPT  AMOUNTS  PAID  TO  CREDITORS,  IN ADDITION TO THE RECOVERY UNDER
PARAGRAPHS (C) AND (D) OF SUBDIVISION THREE OF THIS SECTION.
  2.  IF AN INDIVIDUAL VOIDS AN AGREEMENT PURSUANT TO SUBDIVISION TWO OF
SECTION FIVE HUNDRED EIGHTY-FIVE OF THIS  ARTICLE,  THE  INDIVIDUAL  MAY
RECOVER  IN  A  CIVIL  ACTION  THREE TIMES THE TOTAL AMOUNT OF THE FEES,
CHARGES, MONEY, AND PAYMENTS MADE BY THE INDIVIDUAL TO THE PROVIDER,  IN
ADDITION  TO  THE  RECOVERY  UNDER PARAGRAPH (D) OF SUBDIVISION THREE OF
THIS SECTION.
  3. SUBJECT TO SUBDIVISION FOUR OF THIS  SECTION,  AN  INDIVIDUAL  WITH
RESPECT  TO WHOM A PROVIDER VIOLATES THIS ARTICLE MAY RECOVER IN A CIVIL
ACTION FROM THE PROVIDER AND ANY THIRD PARTY THAT CAUSED THE VIOLATION:
  (A) ACTUAL DAMAGES FOR INJURY, CAUSED BY THE VIOLATION;
  (B) EXCEPT AS OTHERWISE PROVIDED IN SUBDIVISION FOUR OF  THIS  SECTION
AND  SUBJECT  TO ADJUSTMENT OF THE DOLLAR AMOUNT PURSUANT TO SUBDIVISION
SIX OF SECTION FIVE HUNDRED EIGHTY-SIX-C OF THIS ARTICLE,  WITH  RESPECT
TO A VIOLATION OF SECTION FIVE HUNDRED EIGHTY-THREE, FIVE HUNDRED EIGHT-
Y-THREE-B,  FIVE  HUNDRED EIGHTY-THREE-C, FIVE HUNDRED EIGHTY-FOUR, FIVE
HUNDRED EIGHTY-FOUR-A, FIVE HUNDRED EIGHTY-FOUR-B, FIVE HUNDRED  EIGHTY-
FOUR-C,  FIVE  HUNDRED EIGHTY-FIVE-B, OR SUBDIVISION ONE, TWO OR FOUR OF
SECTION FIVE HUNDRED EIGHTY-FIVE-C OF THIS ARTICLE, THE GREATER  OF  THE
AMOUNT RECOVERABLE UNDER PARAGRAPH (A) OF THIS SUBDIVISION OR FIVE THOU-
SAND DOLLARS;
  (C) PUNITIVE DAMAGES; AND
  (D) REASONABLE ATTORNEY'S FEES AND COSTS.
  4.  IN  A  CLASS  ACTION,  EXCEPT  FOR A VIOLATION OF PARAGRAPH (E) OF
SUBDIVISION ONE OF SECTION FIVE HUNDRED EIGHTY-FIVE-C OF  THIS  ARTICLE,
THE  MINIMUM  DAMAGES  PROVIDED IN PARAGRAPH (B) OF SUBDIVISION THREE OF
THIS SECTION DO NOT APPLY.
  5. IN ADDITION TO THE REMEDY AVAILABLE UNDER SUBDIVISION THREE OF THIS
SECTION, IF A PROVIDER VIOLATES AN  INDIVIDUAL'S  RIGHTS  UNDER  SECTION
FIVE  HUNDRED EIGHTY-THREE-C OF THIS ARTICLE, THE INDIVIDUAL MAY RECOVER
IN A CIVIL ACTION ALL MONEY PAID OR DEPOSITED BY OR  ON  BEHALF  OF  THE
INDIVIDUAL  PURSUANT TO THE AGREEMENT, EXCEPT FOR AMOUNTS PAID TO CREDI-
TORS.
  6. A PROVIDER IS NOT LIABLE UNDER THIS SECTION FOR A VIOLATION OF THIS
ARTICLE IF THE PROVIDER PROVES THAT THE VIOLATION  WAS  NOT  INTENTIONAL
AND  RESULTED FROM A GOOD-FAITH ERROR NOTWITHSTANDING THE MAINTENANCE OF
PROCEDURES REASONABLY ADAPTED TO AVOID THE  ERROR.  AN  ERROR  OF  LEGAL
JUDGMENT  WITH RESPECT TO A PROVIDER'S OBLIGATIONS UNDER THIS ARTICLE IS
NOT A GOOD-FAITH ERROR. IF, IN CONNECTION WITH A VIOLATION, THE PROVIDER
HAS RECEIVED MORE MONEY THAN AUTHORIZED BY AN AGREEMENT OR THIS ARTICLE,
THE DEFENSE PROVIDED BY THIS SUBDIVISION IS  NOT  AVAILABLE  UNLESS  THE
PROVIDER  REFUNDS THE EXCESS WITHIN TWO BUSINESS DAYS OF LEARNING OF THE
VIOLATION.
  7. THE SUPERINTENDENT SHALL ASSIST AN INDIVIDUAL IN ENFORCING A  JUDG-
MENT  AGAINST  THE  SURETY BOND OR OTHER SECURITY PROVIDED UNDER SECTION
FIVE HUNDRED EIGHTY-TWO OR FIVE HUNDRED EIGHTY-TWO-A OF THIS ARTICLE.
  S 587-C. VIOLATION OF THE GENERAL BUSINESS LAW. IF AN ACT OR  PRACTICE
OF A PROVIDER VIOLATED BOTH THIS ARTICLE AND ARTICLE TWENTY-TWO-A OF THE
GENERAL  BUSINESS  LAW  AN INDIVIDUAL MAY NOT RECOVER UNDER BOTH FOR THE
SAME ACT OR PRACTICE.
  S 588. STATUTE OF LIMITATIONS. 1.  AN  ACTION  OR  PROCEEDING  BROUGHT
PURSUANT  TO  SUBDIVISIONS  ONE,  TWO  AND THREE OF SECTION FIVE HUNDRED
EIGHTY-SEVEN OF THIS ARTICLE MUST BE COMMENCED WITHIN FOUR  YEARS  AFTER
THE CONDUCT THAT IS THE BASIS OF THE SUPERINTENDENT'S COMPLAINT.

S. 7067                            27

  2.  AN  ACTION BROUGHT PURSUANT TO SECTION FIVE HUNDRED EIGHTY-SEVEN-B
OF THIS ARTICLE MUST BE COMMENCED WITHIN TWO YEARS AFTER THE LATEST OF:
  (A) THE INDIVIDUAL'S LAST TRANSMISSION OF MONEY TO A PROVIDER;
  (B)  THE  INDIVIDUAL'S LAST TRANSMISSION OF MONEY TO A CREDITOR AT THE
DIRECTION OF THE PROVIDER;
  (C) THE PROVIDER'S LAST DISBURSEMENT TO A CREDITOR OF THE INDIVIDUAL;
  (D) THE PROVIDER'S LAST  ACCOUNTING  TO  THE  INDIVIDUAL  PURSUANT  TO
SUBDIVISION ONE OF SECTION FIVE HUNDRED EIGHTY-FIVE-B OF THIS ARTICLE;
  (E)  THE  DATE ON WHICH THE INDIVIDUAL DISCOVERED OR REASONABLY SHOULD
HAVE DISCOVERED THE FACTS GIVING RISE TO THE INDIVIDUAL'S CLAIM; OR
  (F) TERMINATION OF ACTIONS OR PROCEEDINGS BY THE  SUPERINTENDENT  WITH
RESPECT TO A VIOLATION OF THIS ARTICLE.
  3.  THE  PERIOD PRESCRIBED IN PARAGRAPH (E) OF SUBDIVISION TWO OF THIS
SECTION IS TOLLED DURING ANY PERIOD DURING WHICH  THE  PROVIDER  OR,  IF
DIFFERENT,  THE  DEFENDANT  HAS  MATERIALLY AND WILLFULLY MISREPRESENTED
INFORMATION REQUIRED BY THIS ARTICLE TO BE DISCLOSED TO THE  INDIVIDUAL,
IF THE INFORMATION SO MISREPRESENTED IS MATERIAL TO THE ESTABLISHMENT OF
THE LIABILITY OF THE DEFENDANT UNDER THIS ARTICLE.
  S  588-A.  UNIFORMITY OF APPLICATION AND CONSTRUCTION. IN APPLYING AND
CONSTRUING THIS UNIFORM ACT, CONSIDERATION MUST BE GIVEN TO THE NEED  TO
PROMOTE  UNIFORMITY  OF THE LAW WITH RESPECT TO ITS SUBJECT MATTER AMONG
STATES THAT ENACT IT.
  S 588-B. RELATION TO ELECTRONIC  SIGNATURES  IN  GLOBAL  AND  NATIONAL
COMMERCE  ACT. THIS ARTICLE MODIFIES, LIMITS, AND SUPERSEDES THE FEDERAL
ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL  COMMERCE  ACT  (15  U.S.C.
SECTION  7001  ET SEQ.) BUT DOES NOT MODIFY, LIMIT, OR SUPERSEDE SECTION
101(C) OF THAT ACT (15 U.S.C. SECTION 7001(C)) OR  AUTHORIZE  ELECTRONIC
DELIVERY  OF  ANY OF THE NOTICES DESCRIBED IN SECTION 103(B) OF THAT ACT
(15 U.S.C. SECTION 7003(B)).
  S 588-C.  TRANSITIONAL  PROVISIONS;  APPLICATION  TO  EXISTING  TRANS-
ACTIONS.  TRANSACTIONS ENTERED INTO BEFORE THIS ARTICLE TAKES EFFECT AND
THE  RIGHTS, DUTIES, AND INTERESTS RESULTING FROM THEM MAY BE COMPLETED,
TERMINATED, OR ENFORCED AS REQUIRED  OR  PERMITTED  BY  A  LAW  AMENDED,
REPEALED,  OR  MODIFIED BY THIS ARTICLE AS THOUGH THE AMENDMENT, REPEAL,
OR MODIFICATION HAD NOT OCCURRED.
  S 5. Severability. If any clause, sentence, paragraph, section or part
of this act shall be adjudged by any court of competent jurisdiction  to
be  invalid  and  after  exhaustion  of all further judicial review, the
judgment shall not affect, impair or invalidate the  remainder  thereof,
but  shall  be  confined in its operation to the clause, sentence, para-
graph, section or part of this act directly involved in the  controversy
in which the judgment shall have been rendered.
  S  6. This act shall take effect one year after it shall have become a
law; provided, however, that effective immediately, the addition, amend-
ment and/or repeal of any rule or regulation necessary  for  implementa-
tion of this act on its effective date are authorized and directed to be
made and completed on or before such effective date.