S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3525
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 27, 2021
                                ___________
 
 Introduced  by M. of A. DINOWITZ, BENEDETTO -- read once and referred to
   the Committee on Consumer Affairs and Protection
 
 AN ACT to amend the  general  business  law  and  the  banking  law,  in
   relation to providing for budget planning and debt settlement services
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 455 of the general  business  law,  as  amended  by
 chapter 629 of the laws of 2002, subdivision 1 as amended by chapter 456
 of  the laws of 2006, and subdivision 4 as amended by chapter 549 of the
 laws of 2013, is amended to read as follows:
   § 455. Definitions. 1. Budget planning, as used in this article, means
 the making of a contract between a person or entity engaged in the busi-
 ness of budget planning with a particular debtor whereby:
   (i) the debtor agrees to pay a sum or sums of money in any  manner  or
 form and the person or entity engaged in the business of budget planning
 distributes, or supervises, coordinates or controls the distribution of,
 or  has  a  contractual  relationship with another person or entity that
 distributes, or supervises, coordinates or  controls  such  distribution
 of,  the  same  among  certain  specified creditors in accordance with a
 PERIODIC PAYMENT plan agreed upon; and
   (ii) the debtor agrees to pay to such person or entity, or such  other
 person  or  entity  that  distributes,  or  supervises,  coordinates  or
 controls such distribution of, a sum or  sums  of  money,  any  valuable
 consideration  for  such  services or for any other services rendered in
 connection therewith; PROVIDED, HOWEVER, THAT "BUDGET PLANNING" DOES NOT
 INCLUDE "DEBT SETTLEMENT SERVICES" AS DEFINED IN  SECTION  FIVE  HUNDRED
 EIGHTY-EIGHT-A  OF  THE BANKING LAW. For the purposes of this article, a
 person or entity shall be considered as engaged in the business of budg-
 et planning in New York, and subject to this article and  the  licensing
 and  other  requirements of article twelve-C of the banking law, if such
 person or entity solicits budget planning  business  within  this  state
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD06714-01-1

 A. 3525                             2
 
 and,  in  connection  with such solicitation, enters into a contract for
 budget planning with an individual then resident in this state.
   2.  Person, as used in this article, shall not include a person admit-
 ted to practice law in this state.
   3. Entity, as used in this article, shall not include a firm, partner-
 ship, professional  corporation,  or  other  organization,  all  of  the
 members  or  principals  of  which  are admitted to practice law in this
 state.
   4. [Person or entity as used in this article shall not include a char-
 itable corporation as defined in paragraph (a) of  section  one  hundred
 two  (Definitions)  of the not-for-profit corporation law of this state,
 or an entity incorporated in another state and having a similar not-for-
 profit status, licensed by the superintendent, to engage in the business
 of budget planning as defined in this section.
   5.] Any attorney licensed to practice law in this state who is engaged
 in budget planning shall:
   (a) negotiate directly with creditors on behalf of the client;
   (b) ensure that all moneys received from the client are  deposited  in
 the attorney's account maintained for client funds;
   (c) pay creditors from such account; and
   (d)  offer budget planning services through the same legal entity that
 the attorney uses to practice law.
   § 2. Section 457 of the general business law, as  amended  by  chapter
 629 of the laws of 2002, is amended to read as follows:
   § 457. [Penalty] PENALTIES FOR VIOLATION OF THIS ARTICLE; CRIMINAL AND
 CIVIL.    (A)  Whoever  either  individually  or as officer, director or
 employee of any person, firm, association or corporation,  violates  any
 of  the provisions of the preceding section shall be guilty of a CLASS A
 misdemeanor [for each such violation] PUNISHABLE AS PROVIDED IN ARTICLES
 SEVENTY AND EIGHTY OF THE PENAL LAW.
   (B) WHENEVER THERE SHALL BE A VIOLATION OF THIS  ARTICLE,  APPLICATION
 MAY  BE  MADE  BY  THE ATTORNEY GENERAL IN THE NAME OF THE PEOPLE OF THE
 STATE OF NEW YORK TO A COURT OR JUSTICE HAVING JURISDICTION BY A SPECIAL
 PROCEEDING TO ISSUE AN INJUNCTION, AND UPON NOTICE TO THE  DEFENDANT  OF
 NOT  LESS THAN FIVE DAYS, TO ENJOIN AND RESTRAIN THE CONTINUANCE OF SUCH
 VIOLATIONS; AND IF IT SHALL APPEAR TO THE SATISFACTION OF THE  COURT  OR
 JUSTICE  THAT  THE  DEFENDANT  HAS,  IN  FACT, VIOLATED THIS ARTICLE, AN
 INJUNCTION MAY BE  ISSUED  BY  SUCH  COURT  OR  JUSTICE,  ENJOINING  AND
 RESTRAINING  ANY  FURTHER  VIOLATION,  WITHOUT  REQUIRING PROOF THAT ANY
 PERSON HAS, IN FACT, BEEN INJURED OR DAMAGED THEREBY. IN CONNECTION WITH
 ANY SUCH PROPOSED APPLICATION, THE ATTORNEY  GENERAL  IS  AUTHORIZED  TO
 TAKE  PROOF  AND MAKE A DETERMINATION OF THE RELEVANT FACTS AND TO ISSUE
 SUBPOENAS IN ACCORDANCE WITH THE CIVIL PRACTICE LAW AND RULES.  WHENEVER
 THE  COURT  SHALL  DETERMINE  THAT  A  VIOLATION OF SECTION FOUR HUNDRED
 FIFTY-SIX OF THIS ARTICLE HAS OCCURRED, THE COURT  MAY  IMPOSE  A  CIVIL
 PENALTY  OF  NOT  MORE  THAN  FIVE  HUNDRED DOLLARS PER CONTRACT MADE IN
 VIOLATION OF SUCH SECTION, NOT TO EXCEED ONE HUNDRED THOUSAND DOLLARS.
   § 3. Section 579 of the banking law, as amended by chapter 549 of  the
 laws of 2013, is amended to read as follows:
   §  579.  Doing business without license prohibited. [Only a charitable
 corporation as defined in paragraph  (a)  of  section  one  hundred  two
 (Definitions) of the not-for-profit corporation law of this state, or an
 entity incorporated in another state and having a similar not-for-profit
 status,]  NO  PERSON  OR  ENTITY  shall engage in the business of budget
 planning as defined in subdivision one of section  four  hundred  fifty-
 five of the general business law [of this state] except as authorized by

 A. 3525                             3
 
 this  article and without first obtaining a license from the superinten-
 dent.
   §  4.  Subdivision  2 of section 584-a of the banking law, as added by
 chapter 629 of the laws of 2002, is amended to read as follows:
   2. the total fees agreed to for such services, including  any  adjust-
 ments  for  estimated  available  rebates  from creditors, provided that
 nothing in this subdivision shall require a licensee  to  share  rebates
 with  its  clients AND PROVIDED THAT ANY FEES OR CHARGES IMPOSED MUST BE
 FAIR, REASONABLE AND EASILY UNDERSTOOD;
   § 5. Section 584-b of the banking law  is  amended  by  adding  a  new
 subdivision 4-a to read as follows:
   4-A.    NO  LICENSEE SHALL IMPOSE ANY FEE OR CHARGE WHATSOEVER THAT IS
 NOT FAIR, REASONABLE AND ABLE TO BE EASILY UNDERSTOOD.
   § 6. Section 585 of the banking law, as amended by chapter 629 of  the
 laws of 2002, is amended to read as follows:
   §  585.  Superintendent  authorized  to  examine.  For  the purpose of
 discovering violations of this article or securing information  lawfully
 required  by  him  or her hereunder, the superintendent may at any time,
 and as often as he or she may  determine,  either  personally  or  by  a
 person duly designated by him or her, investigate the business and exam-
 ine the books, accounts, records, and files used therein of every licen-
 see  hereunder.  For that purpose the superintendent and his or her duly
 designated representative shall have free  access  to  the  offices  and
 place  of  business,  books, accounts, papers, records, files, safes and
 vaults of all such licensees. The superintendent  and  any  person  duly
 designated  by him or her shall have authority to require the attendance
 of and to examine under oath all persons whose testimony he or  she  may
 require  relative  to such business. The expenses incurred in making any
 examination pursuant to this section shall be assessed against and  paid
 by  the  licensee  so  examined,  except  that traveling and subsistence
 expenses so incurred shall be charged against and paid by  licensees  in
 such  proportions  as the superintendent shall deem just and reasonable,
 and such proportionate charges shall be added to the assessment  of  the
 other  expenses  incurred  upon each examination. Upon written notice by
 the superintendent of the total amount of such assessment, the  licensee
 shall become liable for and shall pay such assessment to the superinten-
 dent.  If, upon review, the superintendent shall determine that the fees
 or service charges set by  the  licensee  are  UNFAIR,  unreasonable  OR
 UNCLEAR, he or she shall direct the licensee to make adjustments in said
 fees  and  service charges in accordance with his or her findings, which
 shall set forth a detailed factual basis and reasoning  supporting  such
 finding.
   §  7.  Subdivision  10 of section 36 of the banking law, as amended by
 section 2 of part L of chapter 58 of the laws of  2019,  is  amended  to
 read as follows:
   10. All reports of examinations and investigations, correspondence and
 memoranda  concerning  or  arising  out of such examination and investi-
 gations, including any duly authenticated copy or copies thereof in  the
 possession  of  any  banking  organization,  bank holding company or any
 subsidiary thereof (as such terms "bank holding  company"  and  "subsid-
 iary"  are  defined in article three-A of this chapter), any corporation
 or any other entity affiliated with a banking  organization  within  the
 meaning  of  subdivision six of this section and any non-banking subsid-
 iary of a corporation or any other entity which is  an  affiliate  of  a
 banking  organization  within  the  meaning of subdivision six-a of this
 section, foreign banking corporation, licensed lender,  licensed  casher

 A. 3525                             4
 
 of   checks,  licensed  mortgage  banker,  registered  mortgage  broker,
 licensed mortgage  loan  originator,  licensed  sales  finance  company,
 registered  mortgage  loan  servicer,  licensed  student  loan servicer,
 licensed  insurance  premium  finance  agency,  licensed  transmitter of
 money, licensed budget planner, LICENSED DEBT  SETTLEMENT  COMPANY,  any
 other person or entity subject to supervision under this chapter, or the
 department,  shall  be confidential communications, shall not be subject
 to subpoena and shall not be made public unless, in the judgment of  the
 superintendent,  the  ends  of  justice and the public advantage will be
 subserved by the publication thereof, in which event the  superintendent
 may publish or authorize the publication of a copy of any such report or
 any  part  thereof in such manner as may be deemed proper or unless such
 laws specifically authorize such disclosure. For the  purposes  of  this
 subdivision, "reports of examinations and investigations, and any corre-
 spondence  and  memoranda concerning or arising out of such examinations
 and investigations", includes any such materials of a bank, insurance or
 securities regulatory agency or any unit of the  federal  government  or
 that  of  this  state, any other state or that of any foreign government
 which are considered confidential by such agency or unit and  which  are
 in  the possession of the department or which are otherwise confidential
 materials that have been shared by the department with any  such  agency
 or unit and are in the possession of such agency or unit.
   §  8.  Subdivisions 1, 2, 3 and 5 of section 39 of the banking law, as
 amended by section 3 of part L of chapter 58 of the laws  of  2019,  are
 amended to read as follows:
   1.  To  appear  and  explain  an apparent violation. Whenever it shall
 appear to the superintendent that any banking organization, bank holding
 company, registered mortgage broker, licensed mortgage banker,  licensed
 student loan servicer, registered mortgage loan servicer, licensed mort-
 gage  loan  originator,  licensed  lender,  licensed  casher  of checks,
 licensed sales finance company, licensed insurance premium finance agen-
 cy, licensed transmitter of money,  licensed  budget  planner,  LICENSED
 DEBT SETTLEMENT COMPANY, out-of-state state bank that maintains a branch
 or branches or representative or other offices in this state, or foreign
 banking  corporation  licensed  by  the superintendent to do business or
 maintain a representative office in this state has violated any  law  or
 regulation,  he  or  she  may,  in his or her discretion, issue an order
 describing such apparent violation and requiring such banking  organiza-
 tion,  bank  holding company, registered mortgage broker, licensed mort-
 gage banker, licensed student  loan  servicer,  licensed  mortgage  loan
 originator,  licensed  lender, licensed casher of checks, licensed sales
 finance company, licensed insurance  premium  finance  agency,  licensed
 transmitter  of money, licensed budget planner, LICENSED DEBT SETTLEMENT
 COMPANY, out-of-state state bank that maintains a branch or branches  or
 representative or other offices in this state, or foreign banking corpo-
 ration  to  appear  before him or her, at a time and place fixed in said
 order, to present an explanation of such apparent violation.
   2. To discontinue unauthorized or unsafe and unsound practices.  When-
 ever  it  shall  appear to the superintendent that any banking organiza-
 tion, bank holding company, registered mortgage broker,  licensed  mort-
 gage  banker,  licensed  student loan servicer, registered mortgage loan
 servicer, licensed mortgage loan originator, licensed  lender,  licensed
 casher  of  checks,  licensed  sales finance company, licensed insurance
 premium finance agency, licensed transmitter of money,  licensed  budget
 planner,  LICENSED DEBT SETTLEMENT COMPANY, out-of-state state bank that
 maintains a branch or branches or representative  or  other  offices  in

 A. 3525                             5
 
 this  state,  or foreign banking corporation licensed by the superinten-
 dent to do business in this state is conducting business in an unauthor-
 ized or unsafe and unsound  manner,  he  or  she  may,  in  his  or  her
 discretion,  issue  an  order directing the discontinuance of such unau-
 thorized or unsafe and unsound practices, and fixing a time and place at
 which such banking organization, bank holding company, registered  mort-
 gage  broker,  licensed mortgage banker, licensed student loan servicer,
 registered mortgage loan servicer, licensed  mortgage  loan  originator,
 licensed  lender,  licensed  casher  of  checks,  licensed sales finance
 company, licensed insurance premium finance agency, licensed transmitter
 of money, licensed budget planner,  LICENSED  DEBT  SETTLEMENT  COMPANY,
 out-of-state state bank that maintains a branch or branches or represen-
 tative  or  other  offices in this state, or foreign banking corporation
 may voluntarily appear before him or her to present any  explanation  in
 defense of the practices directed in said order to be discontinued.
   3.  To  make  good  impairment of capital or to ensure compliance with
 financial requirements. Whenever it shall appear to  the  superintendent
 that  the  capital  or  capital  stock of any banking organization, bank
 holding company or any subsidiary thereof which is  organized,  licensed
 or  registered  pursuant  to this chapter, is impaired, or the financial
 requirements imposed by subdivision one of section two hundred two-b  of
 this  chapter  or  any regulation of the superintendent on any branch or
 agency of a foreign banking corporation or  the  financial  requirements
 imposed  by  this chapter or any regulation of the superintendent on any
 licensed lender, registered mortgage broker, licensed  mortgage  banker,
 licensed  student  loan  servicer,  licensed  casher of checks, licensed
 sales  finance  company,  licensed  insurance  premium  finance  agency,
 licensed  transmitter  of  money, licensed budget planner, LICENSED DEBT
 SETTLEMENT COMPANY, or private banker are not satisfied, the superinten-
 dent may, in the superintendent's discretion, issue an  order  directing
 that  such  banking organization, bank holding company, branch or agency
 of a foreign banking corporation, registered mortgage  broker,  licensed
 mortgage  banker,  licensed  student  loan  servicer,  licensed  lender,
 licensed casher of checks,  licensed  sales  finance  company,  licensed
 insurance   premium  finance  agency,  licensed  transmitter  of  money,
 licensed budget planner, LICENSED DEBT SETTLEMENT  COMPANY,  or  private
 banker make good such deficiency forthwith or within a time specified in
 such order.
   5.  To keep books and accounts as prescribed. Whenever it shall appear
 to the superintendent that any banking organization, bank holding compa-
 ny, registered  mortgage  broker,  licensed  mortgage  banker,  licensed
 student loan servicer, registered mortgage loan servicer, licensed mort-
 gage  loan  originator,  licensed  lender,  licensed  casher  of checks,
 licensed sales finance company, licensed insurance premium finance agen-
 cy, licensed transmitter of money,  licensed  budget  planner,  LICENSED
 DEBT  SETTLEMENT  COMPANY,  agency or branch of a foreign banking corpo-
 ration licensed by the superintendent to do business in this state, does
 not keep its books and accounts in such manner as to enable him  or  her
 to  readily  ascertain  its true condition, he or she may, in his or her
 discretion, issue an order requiring  such  banking  organization,  bank
 holding  company,  registered mortgage broker, licensed mortgage banker,
 licensed student  loan  servicer,  registered  mortgage  loan  servicer,
 licensed  mortgage  loan originator, licensed lender, licensed casher of
 checks, licensed  sales  finance  company,  licensed  insurance  premium
 finance  agency, licensed transmitter of money, licensed budget planner,
 LICENSED DEBT SETTLEMENT COMPANY, or foreign banking corporation, or the

 A. 3525                             6
 
 officers or agents thereof, or any of them, to open and keep such  books
 or  accounts  as  he or she may, in his or her discretion, determine and
 prescribe for the purpose of keeping accurate and convenient records  of
 its transactions and accounts.
   §  9. Paragraph (a) of subdivision 1 of section 44 of the banking law,
 as amended by section 4 of part L of chapter 58 of the laws of 2019,  is
 amended to read as follows:
   (a) Without limiting any power granted to the superintendent under any
 other provision of this chapter, the superintendent may, in a proceeding
 after  notice  and a hearing, require any safe deposit company, licensed
 lender, licensed casher  of  checks,  licensed  sales  finance  company,
 licensed  insurance  premium  finance  agency,  licensed  transmitter of
 money, licensed mortgage banker, licensed student loan servicer,  regis-
 tered  mortgage  broker,  licensed  mortgage loan originator, registered
 mortgage loan servicer[or], licensed budget  planner  OR  LICENSED  DEBT
 SETTLEMENT  COMPANY to pay to the people of this state a penalty for any
 violation of this chapter, any regulation  promulgated  thereunder,  any
 final  or temporary order issued pursuant to section thirty-nine of this
 article, any condition imposed  in  writing  by  the  superintendent  in
 connection  with the grant of any application or request, or any written
 agreement entered into with the superintendent.
   § 10. The banking law is amended by adding a new article 12-CC to read
 as follows:
                              ARTICLE XII-CC
                         DEBT SETTLEMENT COMPANIES
 SECTION 588-A. DEFINITIONS.
         588-B. DOING BUSINESS WITHOUT LICENSE PROHIBITED.
         588-C. APPLICATION FOR LICENSE.
         588-D. CONDITIONS FOR ISSUANCE OF  A  LICENSE;  PROCEDURE  WHERE
                  APPLICATION DENIED.
         588-E. LICENSE PROVISIONS.
         588-F. CHANGES IN OFFICERS OR DIRECTORS OF LICENSEE.
         588-G. CHANGES IN CONTROL.
         588-H. GROUNDS  FOR  SUSPENSION,  REVOCATION,  OR TERMINATION OF
                  LICENSE; PROCEDURE.
         588-I. ADVERTISING AND MARKETING PRACTICES.
         588-J. INDIVIDUALIZED FINANCIAL ANALYSIS; STATEMENT.
         588-K. REQUIRED PRE-AGREEMENT DISCLOSURES AND WARNINGS.
         588-L. DEBT SETTLEMENT SERVICES AGREEMENTS.
         588-M. FEES.
         588-N. DEBTOR SETTLEMENT ACCOUNTS; MONTHLY ACCOUNTING.
         588-O. CANCELLATION OF DEBT SETTLEMENT SERVICES AGREEMENT; RIGHT
                  TO REFUNDS.
         588-P. OBLIGATION OF GOOD FAITH.
         588-Q. PROHIBITED ACTIVITIES.
         588-R. SUPERINTENDENT AUTHORIZED TO EXAMINE.
         588-S. LICENSEE'S BOOKS AND RECORDS; REPORTS.
         588-T. PENALTIES; NONCOMPLIANCE.
         588-U. AUTHORITY OF SUPERINTENDENT.
         588-V. SEVERABILITY.
   § 588-A. DEFINITIONS. AS USED IN THIS ARTICLE:  1.  "AFFILIATE"  MEANS
 ANY PERSON THAT DIRECTLY OR INDIRECTLY CONTROLS, IS CONTROLLED BY, OR IS
 UNDER COMMON CONTROL WITH ANOTHER PERSON.
   2. "CLEARLY AND CONSPICUOUSLY" MEANS THAT A STATEMENT, REPRESENTATION,
 TERM, OR DISCLOSURE IS SO PRESENTED AS TO BE READILY APPARENT AND UNDER-
 STOOD BY THE PERSON TO WHOM IT IS BEING ADDRESSED. FACTORS TO BE CONSID-

 A. 3525                             7
 
 ERED  FOR  THIS  PURPOSE INCLUDE BUT ARE NOT LIMITED TO SIZE, PLACEMENT,
 COLOR CONTRAST, LENGTH, CRAWL TIME, AND AUDIBILITY.
   3. "DEBTOR" MEANS ANY INDIVIDUAL WHO HAS INCURRED INDEBTEDNESS OR OWES
 A DEBT.
   4.  "DEBTOR  SETTLEMENT  ACCOUNT"  MEANS ANY ACCOUNT OR OTHER MEANS OR
 DEVICE IN WHICH PAYMENTS, DEPOSITS, OR OTHER TRANSFERS FROM A DEBTOR ARE
 ARRANGED, HELD, OR TRANSFERRED BY OR TO A DEBT  SETTLEMENT  COMPANY  FOR
 THE  ACCUMULATION OF THE DEBTOR'S FUNDS IN ANTICIPATION OF PROFFERING AN
 ADJUSTMENT OR SETTLEMENT OF A DEBT OR OBLIGATION OF THE DEBTOR.
   5. "DEBT SETTLEMENT COMPANY" MEANS ANY PERSON:
   (A) ENGAGING IN, OR HOLDING HIMSELF, HERSELF, OR ITSELF OUT AS  ENGAG-
 ING  IN,  THE BUSINESS OF PROVIDING DEBT SETTLEMENT SERVICES IN EXCHANGE
 FOR OR IN EXPECTATION OF ANY COMPENSATION OR GAIN; OR
   (B) SOLICITING FOR OR ACTING ON BEHALF OF ANY PERSON ENGAGING  IN,  OR
 HOLDING  HIMSELF, HERSELF, OR ITSELF OUT AS ENGAGING IN, THE BUSINESS OF
 PROVIDING DEBT SETTLEMENT SERVICES IN EXCHANGE FOR OR IN EXPECTATION  OF
 ANY  COMPENSATION  OR  GAIN;  PROVIDED,  HOWEVER,  THAT "DEBT SETTLEMENT
 COMPANY" SHALL NOT INCLUDE:
   (I) THE FOLLOWING EXEMPT PERSONS:
   (A) ANY ATTORNEY LICENSED TO PRACTICE LAW IN THIS STATE WHEN ACTING IN
 THE ORDINARY PRACTICE OF LAW AND THROUGH THE ENTITY USED BY THE ATTORNEY
 IN THE ORDINARY PRACTICE OF LAW, AND NOT HOLDING HIMSELF OR HERSELF  OUT
 AS  A  DEBT  SETTLEMENT  COMPANY,  AND  NOT  PROVIDING  DEBT  SETTLEMENT
 SERVICES, EXCEPT AS INCIDENTAL TO LEGAL REPRESENTATION;
   (B) ANY PUBLIC OFFICER WHILE ACTING IN AN OFFICIAL  CAPACITY  AND  ANY
 PERSON ACTING UNDER COURT ORDER; OR
   (C)  ANY  PERSON  WHILE  PERFORMING SERVICES INCIDENTAL TO THE DISSOL-
 UTION, WINDING UP, OR LIQUIDATION  OF  A  PARTNERSHIP,  CORPORATION,  OR
 OTHER BUSINESS ENTERPRISE; OR
   (D)  ANY  BANK,  TRUST COMPANY, SAVINGS BANK, SAVINGS AND LOAN ASSOCI-
 ATION, OR CREDIT UNION, WHETHER INCORPORATED,  CHARTERED,  OR  ORGANIZED
 UNDER THE LAWS OF THIS STATE OR ANY OTHER STATE OR THE UNITED STATES, OR
 ANY  OPERATING SUBSIDIARY OF ANY SUCH BANK, TRUST COMPANY, SAVINGS BANK,
 SAVINGS AND LOAN ASSOCIATION, OR CREDIT UNION.
   (II) SUCH OTHER PERSONS AS MAY BE SPECIFICALLY EXEMPTED BY THE  SUPER-
 INTENDENT IN HIS OR HER SOLE DISCRETION AND CONSISTENT WITH THE PURPOSES
 OF THIS ARTICLE AND THE RULES AND REGULATIONS PROMULGATED HEREUNDER.
   6. "DEBT SETTLEMENT SERVICES" MEANS:
   (A)  OFFERING  TO PROVIDE OR PROVIDING ADVICE OR SERVICES, OR OFFERING
 TO ACT OR ACTING AS AN INTERMEDIARY BETWEEN OR ON BEHALF OF A DEBTOR AND
 ONE OR MORE OF THE DEBTOR'S CREDITORS, WHERE THE PRIMARY PURPOSE OF  THE
 ADVICE,  SERVICE,  OR  ACTION  IS TO OBTAIN A SETTLEMENT, ADJUSTMENT, OR
 SATISFACTION OF THE DEBTOR'S UNSECURED DEBT TO A CREDITOR IN  AN  AMOUNT
 LESS THAN THE PRINCIPAL AMOUNT OF THE DEBT OR IN AN AMOUNT LESS THAN THE
 CURRENT OUTSTANDING BALANCE OF THE DEBT; OR
   (B)  OFFERING  TO  PROVIDE  SERVICES  RELATED TO OR PROVIDING SERVICES
 ADVISING, ENCOURAGING, ASSISTING, OR COUNSELING A DEBTOR  TO  ACCUMULATE
 FUNDS  FOR  THE  PRIMARY  PURPOSE OF PROPOSING, OBTAINING, OR SEEKING TO
 OBTAIN A SETTLEMENT, ADJUSTMENT, OR SATISFACTION OF THE  DEBTOR'S  UNSE-
 CURED  DEBT TO A CREDITOR IN AN AMOUNT LESS THAN THE PRINCIPAL AMOUNT OF
 THE DEBT OR IN AN AMOUNT LESS THAN THE CURRENT  OUTSTANDING  BALANCE  OF
 THE  DEBT;  PROVIDED,  HOWEVER,  THAT DEBT SETTLEMENT SERVICES SHALL NOT
 INCLUDE:
   (I) "BUDGET PLANNING" AS DEFINED IN SECTION FOUR HUNDRED FIFTY-FIVE OF
 THE GENERAL BUSINESS LAW; OR

 A. 3525                             8

   (II) THE SERVICES OF AN ATTORNEY IN PROVIDING INFORMATION, ADVICE,  OR
 LEGAL  REPRESENTATION  WITH RESPECT TO FILING A CASE OR PROCEEDING UNDER
 TITLE 11 OF THE UNITED STATES CODE.
   7.  "DEBT  SETTLEMENT  SERVICES  AGREEMENT"  MEANS A CONTRACT OR OTHER
 AGREEMENT WITH A DEBTOR RELATED TO  THE  PROVISION  OF  DEBT  SETTLEMENT
 SERVICES.
   8. "ENROLLMENT FEE" MEANS ANY FEE, OBLIGATION, OR COMPENSATION PAID OR
 TO  BE  PAID BY THE DEBTOR TO A DEBT SETTLEMENT COMPANY IN CONSIDERATION
 OF OR IN CONNECTION WITH ESTABLISHING A DEBT SETTLEMENT SERVICES  AGREE-
 MENT.
   9.  "MAINTENANCE  FEE" MEANS ANY FEE, OBLIGATION, OR COMPENSATION PAID
 OR TO BE PAID BY A DEBTOR TO A DEBT SETTLEMENT COMPANY IN  CONSIDERATION
 OF  OR  IN  CONNECTION  WITH  MAINTAINING  THE RELATIONSHIP AND SERVICES
 PROVIDED BY A DEBT SETTLEMENT COMPANY IN ACCORDANCE WITH A DEBT  SETTLE-
 MENT SERVICES AGREEMENT.
   10.  "PERSON"  MEANS  AN  INDIVIDUAL,  PARTNERSHIP,  LIMITED LIABILITY
 COMPANY, CORPORATION, ASSOCIATION, OR ANY OTHER LEGAL ENTITY.
   11. "PRINCIPAL AMOUNT OF THE DEBT" MEANS THE TOTAL AMOUNT  OWED  BY  A
 DEBTOR  TO  ONE  OR MORE CREDITORS FOR A DEBT THAT IS INCLUDED IN A DEBT
 SETTLEMENT SERVICES AGREEMENT AT THE TIME WHEN THE  DEBTOR  ENTERS  INTO
 SUCH AGREEMENT.
   12.  "SETTLEMENT  FEE" MEANS ANY FEE, OBLIGATION, OR COMPENSATION PAID
 OR TO BE PAID BY A DEBTOR TO A DEBT SETTLEMENT COMPANY IN  CONSIDERATION
 OF  OR  IN CONNECTION WITH AN AGREEMENT OR OTHER ARRANGEMENT ON THE PART
 OF A CREDITOR TO ACCEPT LESS THAN THE PRINCIPAL AMOUNT OF  THE  DEBT  AS
 SATISFACTION OF THE CREDITOR'S CLAIM AGAINST THE DEBTOR.
   §  588-B.  DOING  BUSINESS  WITHOUT  LICENSE  PROHIBITED. 1. EXCEPT AS
 PROVIDED IN SUBDIVISION THREE OF THIS SECTION, NO PERSON SHALL ENGAGE IN
 THE BUSINESS OF A DEBT SETTLEMENT COMPANY IN THIS  STATE  WITHOUT  FIRST
 OBTAINING  A  LICENSE  FROM  THE  SUPERINTENDENT  IN ACCORDANCE WITH THE
 LICENSING PROCEDURE PROVIDED IN THIS ARTICLE AND SUCH  RULES  AND  REGU-
 LATIONS AS MAY BE PROMULGATED HEREUNDER.
   2.  THE  BUSINESS  OF  A  DEBT SETTLEMENT COMPANY IS CONDUCTED IN THIS
 STATE IF THE DEBT SETTLEMENT COMPANY, ITS EMPLOYEES, OR ITS  AGENTS  ARE
 LOCATED  IN  THIS  STATE  OR  IF THE DEBT SETTLEMENT COMPANY ADVERTISES,
 SOLICITS, OFFERS, OR CONTRACTS TO PROVIDE DEBT  SETTLEMENT  SERVICES  TO
 DEBTORS THEN RESIDENT IN THIS STATE.
   3. IF A DEBT SETTLEMENT COMPANY IS LICENSED UNDER THIS ARTICLE, SUBDI-
 VISION ONE OF THIS SECTION DOES NOT APPLY TO ANY EMPLOYEE OF SUCH LICEN-
 SEE.
   §  588-C.  APPLICATION  FOR  LICENSE.  1.  APPLICATION  FOR  A LICENSE
 REQUIRED UNDER THIS ARTICLE SHALL BE IN WRITING, UNDER OATH, AND IN  THE
 FORM PRESCRIBED BY THE SUPERINTENDENT, AND SHALL CONTAIN THE FOLLOWING:
   (A)  THE  EXACT NAME AND COMPLETE STREET ADDRESS OF THE APPLICANT AND,
 IF APPLICABLE, ITS DATE OF INCORPORATION OR ORGANIZATION;
   (B) THE NAME AND COMPLETE BUSINESS AND RESIDENTIAL ADDRESS AND OCCUPA-
 TION OF EACH OFFICER AND DIRECTOR OF THE APPLICANT AND EACH PERSON  THAT
 OWNS  AT LEAST TEN PERCENT OF THE SHARES OR OTHER OWNERSHIP INTERESTS OF
 THE APPLICANT;
   (C) THE COMPLETE STREET ADDRESS OF THE PRINCIPAL OFFICE FROM WHICH THE
 BUSINESS IS TO BE CONDUCTED;
   (D) IF THE APPLICANT HAS ONE OR MORE BRANCHES, SUBSIDIARIES, OR AFFIL-
 IATES LOCATED IN THIS STATE, SOLICITING BUSINESS IN THIS STATE, OR DOING
 BUSINESS WITH RESIDENTS OF THIS STATE, THE COMPLETE ADDRESS OF EACH SUCH
 PLACE OF BUSINESS; AND

 A. 3525                             9

   (E)  SUCH  OTHER  PERTINENT  INFORMATION  AS  THE  SUPERINTENDENT  MAY
 REQUIRE,  INCLUDING  BUT  NOT  LIMITED  TO  EVIDENCE INDICATING THAT THE
 APPLICANT, OR AN OFFICER, DIRECTOR, OR MANAGER OF SUCH APPLICANT HAS  AT
 LEAST  ONE  YEAR  OF  EXPERIENCE IN FINANCIAL SERVICES OR RELATED FIELDS
 APPLICABLE TO DEBT SETTLEMENT SERVICES.
   2.  AN  APPLICANT  SHALL  FILE  A MASTER APPLICATION FOR ITS PRINCIPAL
 OFFICE AND SUPPLEMENTAL APPLICATIONS FOR EACH BRANCH  OFFICE  THAT  WILL
 CONDUCT THE BUSINESS OF A DEBT SETTLEMENT COMPANY IN THIS STATE.
   3.  UPON ORIGINAL APPLICATION FOR A LICENSE OR LICENSES, THE APPLICANT
 SHALL PAY AN INVESTIGATION FEE IN  AN  AGGREGATE  AMOUNT  AS  PRESCRIBED
 PURSUANT  TO  SECTION EIGHTEEN-A OF THIS CHAPTER. NO ADDITIONAL INVESTI-
 GATION FEE SHALL BE  REQUIRED  FOR  ANY  SUBSEQUENT  APPLICATION  FOR  A
 LICENSE  UNLESS  SUCH APPLICATION IS SUBSEQUENT TO A DENIAL OF A LICENSE
 OR TO A REVOCATION, SUSPENSION, SURRENDER, OR TERMINATION OF A  LICENSE;
 PROVIDED,  HOWEVER,  THAT AN APPLICATION TO ESTABLISH A BRANCH OFFICE OF
 THE LICENSEE SHALL BE ACCOMPANIED BY THE FEE PRESCRIBED IN SECTION EIGH-
 TEEN-A OF THIS CHAPTER.
   4. AS A CONDITION FOR THE ISSUANCE AND RETENTION  OF  A  LICENSE,  AND
 SUBJECT  TO  SUCH  REGULATIONS  AS  THE  SUPERINTENDENT SHALL PRESCRIBE,
 APPLICANTS FOR A LICENSE SHALL FILE WITH  THE  SUPERINTENDENT  A  SURETY
 BOND  IN  FAVOR  OR  THE  SUPERINTENDENT, ISSUED BY A BONDING COMPANY OR
 INSURANCE COMPANY AUTHORIZED TO DO BUSINESS IN THIS STATE, AND IN A FORM
 SATISFACTORY TO THE SUPERINTENDENT.
   (A) IN LIEU OF THE SURETY BOND REQUIRED BY THIS SUBDIVISION, AN APPLI-
 CANT MAY PLEDGE TO THE SUPERINTENDENT AND MAINTAIN IN A  PLEDGE  ACCOUNT
 WITH  SUCH  BANKS,  SAVINGS  BANKS, SAVINGS AND LOAN ASSOCIATIONS, TRUST
 COMPANIES, NATIONAL BANKS, FEDERAL SAVINGS BANKS, OR FEDERAL SAVINGS AND
 LOAN ASSOCIATIONS IN THE STATE AS SUCH LICENSEE MAY  DESIGNATE  AND  THE
 SUPERINTENDENT MAY APPROVE:
   (I)  INTEREST-BEARING  BILLS, NOTES, BONDS, DEBENTURES, OR OTHER OBLI-
 GATIONS ISSUED OR GUARANTEED BY THE UNITED STATES OR ANY STATE OR  OTHER
 LOCAL  GOVERNMENTAL  ENTITY  OR  ANY  INSTRUMENTALITY THEREOF, BEARING A
 RATING OF ONE OF THE THREE HIGHEST GRADES  BY  A  NATIONALLY  RECOGNIZED
 STATISTICAL  RATING  ORGANIZATION  THAT HAS BEEN ENGAGED IN RATING STATE
 AND MUNICIPAL ISSUES FOR A PERIOD OF NOT LESS THAN FIVE YEARS;
   (II) DOLLAR DEPOSITS; OR
   (III) SUCH OTHER ASSETS OR LETTERS OF  CREDIT  AS  THE  SUPERINTENDENT
 SHALL BY RULE OR REGULATION PERMIT.
   (B)  EXCEPT AS PROVIDED HEREUNDER, THE PRINCIPAL AMOUNT OF SUCH SURETY
 BOND OR DEPOSIT SHALL BE TWO HUNDRED FIFTY THOUSAND DOLLARS. THE  SUPER-
 INTENDENT MAY:
   (I)  REQUIRE  A LARGER BOND OR DEPOSIT IF HE OR SHE DETERMINES, IN HIS
 OR HER SOLE DISCRETION, THAT A LICENSEE HAS  ENGAGED  IN  A  PATTERN  OF
 CONDUCT  RESULTING IN BONA FIDE DEBTOR COMPLAINTS OF MISCONDUCT AND THAT
 SUCH INCREASED BOND OR  DEPOSIT  IS  NECESSARY  FOR  THE  PROTECTION  OF
 DEBTORS; OR
   (II)  INCREASE  OR  DECREASE  THE AMOUNT OF SUCH BOND OR DEPOSIT BASED
 UPON THE APPLICANT'S OR LICENSEE'S FINANCIAL CONDITION,  BUSINESS  PLAN,
 BUSINESS  EXPERIENCE,  OR  ANY OTHER FACTOR THE SUPERINTENDENT CONSIDERS
 APPROPRIATE.
   (C) THE PROCEEDS OF SUCH SURETY BOND OR  DEPOSIT  SHALL  CONSTITUTE  A
 TRUST FUND TO BE USED EXCLUSIVELY:
   (I)  TO  REIMBURSE  FEES  THAT  HAVE  BEEN  IMPROPERLY  CHARGED  TO OR
 COLLECTED FROM DEBTORS WITH RESPECT TO THE BUSINESS OF A DEBT SETTLEMENT
 COMPANY IN THIS STATE, AS SUCH BUSINESS IS  DESCRIBED  IN  SECTION  FIVE
 HUNDRED EIGHTY-EIGHT-B OF THIS ARTICLE;

 A. 3525                            10
 
   (II)  TO  REIMBURSE AMOUNTS THAT HAVE NOT BEEN PROPERLY DISTRIBUTED TO
 CREDITORS OR PROPERLY RETURNED TO DEBTORS WITH RESPECT TO  THE  BUSINESS
 OF  A  DEBT  SETTLEMENT  COMPANY  IN  THIS  STATE,  AS  SUCH BUSINESS IS
 DESCRIBED IN SECTION FIVE HUNDRED EIGHTY-EIGHT-B OF THIS ARTICLE; AND
   (III)  TO  PAY  OUTSTANDING  BANKING  DEPARTMENT EXAMINATION COSTS AND
 ASSESSMENTS.
   § 588-D. CONDITIONS FOR ISSUANCE OF A LICENSE; PROCEDURE WHERE  APPLI-
 CATION  DENIED.  UPON THE FILING OF AN APPLICATION FOR A LICENSE, IF THE
 SUPERINTENDENT SHALL FIND THAT THE FINANCIAL RESPONSIBILITY, EXPERIENCE,
 CHARACTER, AND GENERAL FITNESS OF THE  APPLICANT,  AND  OF  THE  CONTROL
 PERSONS,  OFFICERS,  AND  DIRECTORS  THEREOF  ARE SUCH AS TO COMMAND THE
 CONFIDENCE OF THE COMMUNITY AND TO WARRANT BELIEF THAT THE BUSINESS WILL
 BE OPERATED HONESTLY, FAIRLY, AND EFFICIENTLY  WITHIN  THE  PURPOSES  OF
 THIS  ARTICLE, HE OR SHE SHALL THEREUPON ISSUE A LICENSE IN DUPLICATE TO
 ENGAGE IN DEBT SETTLEMENT SERVICES IN ACCORDANCE WITH THE PROVISIONS  OF
 THIS  ARTICLE.    THE  SUPERINTENDENT  SHALL  TRANSMIT  ONE COPY OF SUCH
 LICENSE TO THE APPLICANT AND FILE THE OTHER IN THE OFFICE OF THE DEPART-
 MENT. SUCH LICENSE SHALL REMAIN IN FULL FORCE AND  EFFECT  UNTIL  IT  IS
 SURRENDERED  BY  THE  LICENSEE  OR  REVOKED, SUSPENDED, OR TERMINATED AS
 HEREINAFTER PROVIDED.  IF THE SUPERINTENDENT SHALL NOT SO  FIND,  HE  OR
 SHE  SHALL  NOT ISSUE SUCH LICENSE AND HE OR SHE SHALL NOTIFY THE APPLI-
 CANT OF THE DENIAL.
   § 588-E. LICENSE PROVISIONS. EACH LICENSE ISSUED  UNDER  THIS  ARTICLE
 SHALL STATE THE PRINCIPAL OFFICE ADDRESS AND, IF APPLICABLE, THE ADDRESS
 OF  THE  BRANCH OFFICE FOR WHICH IT WAS ISSUED. SUCH LICENSE SHALL STATE
 FULLY THE NAME OF THE LICENSEE AND, IF APPLICABLE, THE DATE AND PLACE OF
 ITS INCORPORATION OR ORGANIZATION. A COPY OF SUCH LICENSE SHALL BE PROM-
 INENTLY POSTED IN THE PRINCIPAL OFFICE AND, IF APPLICABLE,  SUCH  BRANCH
 OFFICE.    SUCH  LICENSE SHALL NOT BE TRANSFERABLE OR ASSIGNABLE. IN THE
 EVENT THE LOCATION AT WHICH THE BUSINESS IS TO  BE  CONDUCTED  SHALL  BE
 CHANGED,  THE  LICENSEE  SHALL  FORTHWITH  NOTIFY THE SUPERINTENDENT WHO
 SHALL THEREUPON WITHOUT CHARGE ATTACH TO THE  LICENSE  A  RIDER  SETTING
 FORTH SUCH CHANGED LOCATION.
   §  588-F.  CHANGES  IN OFFICERS OR DIRECTORS OF LICENSEE. IN THE EVENT
 THAT THERE SHALL BE ANY CHANGE AMONG THE OFFICERS OR  DIRECTORS  OF  ANY
 LICENSEE,  THE  LICENSEE SHALL PROMPTLY NOTIFY THE SUPERINTENDENT OF THE
 NAME, ADDRESS, AND OCCUPATION  OF  EACH  NEW  OFFICER  OR  DIRECTOR  AND
 PROVIDE SUCH OTHER INFORMATION AS THE SUPERINTENDENT MAY REQUIRE.
   §  588-G.  CHANGES IN CONTROL. 1. IT SHALL BE UNLAWFUL EXCEPT WITH THE
 PRIOR APPROVAL OF THE SUPERINTENDENT FOR ANY ACTION TO  BE  TAKEN  WHICH
 RESULTS  IN  A CHANGE OF CONTROL OF THE BUSINESS OF A LICENSEE. PRIOR TO
 ANY CHANGE OF CONTROL, THE PERSON DESIROUS OF ACQUIRING CONTROL  OF  THE
 BUSINESS OF A LICENSEE SHALL MAKE WRITTEN APPLICATION TO THE SUPERINTEN-
 DENT  AND  PAY  AN  INVESTIGATION  FEE AS PRESCRIBED PURSUANT TO SECTION
 EIGHTEEN-A OF THIS CHAPTER TO THE SUPERINTENDENT.  THE APPLICATION SHALL
 CONTAIN SUCH INFORMATION AS THE SUPERINTENDENT MAY PRESCRIBE  AS  NECES-
 SARY OR APPROPRIATE FOR THE PURPOSE OF MAKING THE DETERMINATION REQUIRED
 BY SUBDIVISION TWO OF THIS SECTION.
   2.  THE SUPERINTENDENT SHALL APPROVE OR DISAPPROVE THE PROPOSED CHANGE
 OF CONTROL OF A LICENSEE IN ACCORDANCE WITH THE  PROVISIONS  OF  SECTION
 FIVE HUNDRED EIGHTY-EIGHT-D OF THIS ARTICLE.
   3.  AS  USED IN THIS SECTION, THE TERM "CONTROL" MEANS THE POSSESSION,
 DIRECTLY OR INDIRECTLY, OF THE POWER TO DIRECT OR CAUSE THE DIRECTION OF
 THE MANAGEMENT AND POLICIES OF A LICENSEE, WHETHER THROUGH THE OWNERSHIP
 OF VOTING STOCK OF SUCH LICENSEE, THE OWNERSHIP OF VOTING STOCK  OF  ANY
 PERSON  WHICH  POSSESSES  SUCH  POWER  OR  OTHERWISE.  CONTROL  SHALL BE

 A. 3525                            11
 
 PRESUMED TO EXIST IF ANY PERSON, DIRECTLY OR INDIRECTLY, OWNS,  CONTROLS
 OR  HOLDS  WITH POWER TO VOTE TEN PERCENT OR MORE OF THE VOTING STOCK OF
 ANY LICENSEE OR OF ANY PERSON WHICH OWNS, CONTROLS OR HOLDS  WITH  POWER
 TO  VOTE TEN PERCENT OR MORE OF THE VOTING STOCK OF ANY LICENSEE, BUT NO
 PERSON SHALL BE DEEMED TO CONTROL A LICENSEE SOLELY BY REASON  OF  BEING
 AN  OFFICER  OR  DIRECTOR OF SUCH LICENSEE OR PERSON. THE SUPERINTENDENT
 MAY IN HIS OR HER DISCRETION, UPON THE APPLICATION OF A LICENSEE OR  ANY
 PERSON  WHO,  DIRECTLY OR INDIRECTLY, OWNS, CONTROLS OR HOLDS WITH POWER
 TO VOTE OR SEEKS TO OWN, CONTROL OR HOLD WITH POWER TO VOTE  ANY  VOTING
 STOCK  OF SUCH LICENSEE, DETERMINE WHETHER OR NOT THE OWNERSHIP, CONTROL
 OR HOLDING OF SUCH VOTING STOCK CONSTITUTES OR WOULD CONSTITUTE  CONTROL
 OF SUCH LICENSEE FOR PURPOSES OF THIS SECTION.
   §  588-H.  GROUNDS  FOR  SUSPENSION,  REVOCATION,  OR  TERMINATION  OF
 LICENSE; PROCEDURE. 1. IN ADDITION TO THE AUTHORITY SET FORTH IN  SUBDI-
 VISION TWO OF THIS SECTION, THE SUPERINTENDENT MAY SUSPEND OR REVOKE ANY
 LICENSE  ISSUED UNDER THIS ARTICLE IF, AFTER NOTICE AND A HEARING, HE OR
 SHE SHALL FIND THAT:
   (A) THE LICENSEE HAS VIOLATED ANY PROVISIONS OF THIS  ARTICLE,  OR  OF
 ANY  RULE  OR REGULATION MADE BY THE SUPERINTENDENT UNDER AND WITHIN THE
 AUTHORITY OF THIS ARTICLE;
   (B) ANY FACT OR CONDITION EXISTS WHICH, IF IT HAD EXISTED AT THE  TIME
 OF  THE  ORIGINAL APPLICATION FOR SUCH LICENSE, WOULD HAVE WARRANTED THE
 SUPERINTENDENT IN REFUSING ORIGINALLY TO ISSUE SUCH LICENSE; OR
   (C) THE LICENSEE OR AN OFFICER, DIRECTOR, OR  CONTROL  PERSON  OF  THE
 LICENSEE HAS BEEN CONVICTED OF A CRIME AGAINST THE LAWS OF THIS STATE OR
 ANY  OTHER  STATE  OR  OF THE UNITED STATES INVOLVING MORAL TURPITUDE OR
 FRAUDULENT OR DISHONEST ACTIONS, OR A  FINAL  JUDGMENT  IN  A  COURT  OF
 COMPETENT JURISDICTION HAS BEEN ENTERED AGAINST THE LICENSEE OR AN OFFI-
 CER, DIRECTOR, OR CONTROL PERSON OF THE LICENSEE IN A CIVIL ACTION ARIS-
 ING FROM FRAUD, MISREPRESENTATION, OR DECEIT.
   2.  (A)  THE  SUPERINTENDENT  MAY, FOR GOOD CAUSE, WITHOUT NOTICE OR A
 HEARING, ISSUE AN ORDER SUSPENDING ANY LICENSE ISSUED PURSUANT  TO  THIS
 ARTICLE  FOR  A PERIOD NOT EXCEEDING NINETY DAYS, PENDING INVESTIGATION.
 "GOOD CAUSE", AS USED IN THIS SUBDIVISION, SHALL  EXIST  ONLY  WHEN  THE
 LICENSEE  HAS DEFAULTED OR IS LIKELY TO DEFAULT IN PERFORMING ITS FINAN-
 CIAL ENGAGEMENTS OR ENGAGES OR HAS ENGAGED IN DISHONEST  OR  INEQUITABLE
 PRACTICES  WHICH  MAY CAUSE SUBSTANTIAL HARM TO THE PERSONS AFFORDED THE
 PROTECTION OF THIS ARTICLE.
   (B) THE SUPERINTENDENT MAY, IN HIS OR  HER  SOLE  DISCRETION,  WITHOUT
 NOTICE OR A HEARING, ISSUE AN ORDER SUSPENDING ANY LICENSE ISSUED PURSU-
 ANT  TO  THE AUTHORITY OF THIS ARTICLE UPON THE FAILURE OF SUCH LICENSEE
 TO MAKE ANY PAYMENTS AS REQUIRED BY THIS CHAPTER.
   (C) THE SUPERINTENDENT MAY, IN HIS OR  HER  SOLE  DISCRETION,  WITHOUT
 NOTICE OR A HEARING, ISSUE AN ORDER SUSPENDING ANY LICENSE ISSUED PURSU-
 ANT TO THE AUTHORITY OF THIS ARTICLE:
   (I)  THIRTY  DAYS AFTER THE DATE THE LICENSEE FAILS TO FILE ANY REPORT
 REQUIRED UNDER THIS ARTICLE TO BE FILED BY IT WITH THE SUPERINTENDENT;
   (II) IMMEDIATELY UPON THE LICENSEE FILING A PETITION IN BANKRUPTCY;
   (III) AT LEAST THIRTY DAYS AFTER THE LICENSEE HAS HAD FILED AGAINST IT
 A PETITION IN BANKRUPTCY; OR
   (IV) IMMEDIATELY UPON THE RECEIPT BY THE SUPERINTENDENT OF NOTICE THAT
 THE SURETY BOND REQUIRED PURSUANT TO SECTION FIVE HUNDRED EIGHTY-EIGHT-C
 OF THIS ARTICLE IS NO LONGER IN EFFECT OR THAT THE VALUE  OF  ASSETS  IN
 THE PLEDGE ACCOUNT IS LESS THAN THE REQUIRED AMOUNT.
   3.  IF  THE  SUPERINTENDENT  HAS  ISSUED AN ORDER SUSPENDING A LICENSE
 ISSUED PURSUANT TO THE AUTHORITY OF THIS ARTICLE PURSUANT  TO  PARAGRAPH

 A. 3525                            12
 
 (A)  OF  SUBDIVISION TWO OF THIS SECTION, SUCH LICENSE MAY BE REINSTATED
 IF THE SUPERINTENDENT DETERMINES, IN HIS OR HER  SOLE  DISCRETION  AFTER
 INVESTIGATION,  THAT  GOOD  CAUSE  THEREFOR  DID  NOT EXIST OR NO LONGER
 EXISTS.  IF  THE SUPERINTENDENT HAS ISSUED AN ORDER SUSPENDING A LICENSE
 ISSUED PURSUANT TO PARAGRAPH (B) OR  (C)  OF  SUBDIVISION  TWO  OF  THIS
 SECTION,  SUCH  LICENSE  MAY BE REINSTATED, IF THE SUPERINTENDENT DETER-
 MINES, IN HIS OR HER SOLE DISCRETION, THAT THE LICENSEE  HAS  CURED  ALL
 DEFICIENCIES  SET  FORTH  IN  SUCH ORDER BY THE CLOSE OF BUSINESS NINETY
 DAYS AFTER THE DATE OF SUCH SUSPENSION ORDER, INCLUDING, WITHOUT LIMITA-
 TION, MAKING ANY OVERDUE PAYMENT, HAVING ANY  SUCH  BANKRUPTCY  PETITION
 DISMISSED,  OR  HAVING  SUCH  BOND REINSTATED OR DEPOSITING ALL REQUIRED
 ADDITIONAL ASSETS. OTHERWISE, IN THE CASE OF A  SUSPENSION  PURSUANT  TO
 PARAGRAPH  (B)  OR  (C)  OF  SUBDIVISION TWO OF THIS SECTION, UNLESS THE
 SUPERINTENDENT HAS, IN HIS OR HER SOLE DISCRETION, EXTENDED SUCH SUSPEN-
 SION, ALL LICENSES OF SUCH LICENSEE SHALL BE DEEMED TO BE  AUTOMATICALLY
 TERMINATED  BY OPERATION OF LAW AT THE CLOSE OF BUSINESS ON SUCH NINETI-
 ETH DAY.
   4. EXCEPT AS PROVIDED FOR IN  SUBDIVISION  TWO  OF  THIS  SECTION,  NO
 LICENSE  SHALL BE REVOKED OR SUSPENDED EXCEPT AFTER NOTICE AND A HEARING
 THEREON.
   5. WITH THE PRIOR CONSENT OF  THE  SUPERINTENDENT,  ANY  LICENSEE  MAY
 SURRENDER ANY LICENSE BY DELIVERING TO THE SUPERINTENDENT WRITTEN NOTICE
 THAT  IT  THEREBY  SURRENDERS SUCH LICENSE, BUT SUCH SURRENDER SHALL NOT
 AFFECT SUCH LICENSEE'S CIVIL OR CRIMINAL LIABILITY  FOR  ACTS  COMMITTED
 PRIOR  TO  SUCH  SURRENDER  OR ITS OBLIGATIONS TO THE SUPERINTENDENT FOR
 ASSESSMENTS, FEES, OR ADMINISTRATIVE ACTIONS WITH RESPECT TO THE PERIODS
 BEFORE SUCH SURRENDER.
   6. NO REVOCATION, SUSPENSION, TERMINATION, OR SURRENDER OF ANY LICENSE
 SHALL IMPAIR  OR  AFFECT  THE  OBLIGATION  OF  ANY  PRE-EXISTING  LAWFUL
 CONTRACT BETWEEN THE LICENSEE AND ANY PERSON.
   7.  EVERY  LICENSE  ISSUED  HEREUNDER SHALL REMAIN IN FORCE AND EFFECT
 UNTIL THE SAME SHALL  HAVE  BEEN  SURRENDERED,  REVOKED,  SUSPENDED,  OR
 TERMINATED  IN  ACCORDANCE  WITH THE PROVISIONS OF THIS ARTICLE, BUT THE
 SUPERINTENDENT SHALL HAVE AUTHORITY TO REINSTATE A SUSPENDED LICENSE  OR
 TO  ISSUE  A  NEW  LICENSE  TO  A LICENSEE WHOSE LICENSE SHALL HAVE BEEN
 REVOKED IF NO FACT OR CONDITION THEN EXISTS WHICH WOULD  HAVE  WARRANTED
 THE  SUPERINTENDENT  IN  REFUSING ORIGINALLY TO ISSUE SUCH LICENSE UNDER
 THIS ARTICLE.
   8. WHENEVER THE SUPERINTENDENT  SHALL  REVOKE  OR  SUSPEND  A  LICENSE
 ISSUED  PURSUANT  TO  THIS ARTICLE, HE OR SHE SHALL FORTHWITH EXECUTE IN
 DUPLICATE A WRITTEN ORDER TO THAT EFFECT. THE SUPERINTENDENT SHALL  FILE
 ONE  COPY OF SUCH ORDER IN THE OFFICE OF THE DEPARTMENT AND SHALL FORTH-
 WITH SERVE THE OTHER COPY UPON THE  LICENSEE.  ANY  SUCH  ORDER  MAY  BE
 REVIEWED  IN  THE  MANNER PROVIDED BY ARTICLE SEVENTY-EIGHT OF THE CIVIL
 PRACTICE LAW AND RULES. SUCH APPLICATION FOR  REVIEW  AS  AUTHORIZED  BY
 THIS SECTION MUST BE MADE WITHIN THIRTY DAYS FROM THE DATE OF SUCH ORDER
 OF SUSPENSION OR REVOCATION.
   9.  WHENEVER  A  LICENSE SHALL HAVE TERMINATED IN ACCORDANCE WITH THIS
 ARTICLE, THE SUPERINTENDENT SHALL NOTIFY THE LICENSEE THAT  THE  LICENSE
 HAS TERMINATED AND THAT THE LICENSEE MAY NOT ENGAGE IN THE BUSINESS OF A
 DEBT SETTLEMENT COMPANY IN THIS STATE.
   §  588-I.  ADVERTISING  AND  MARKETING PRACTICES. 1. A DEBT SETTLEMENT
 COMPANY SHALL NOT, EXPRESSLY OR  BY  IMPLICATION,  MAKE  ANY  UNFAIR  OR
 DECEPTIVE REPRESENTATIONS, OR ANY OMISSIONS OF MATERIAL FACTS, IN ANY OF
 ITS  ADVERTISING  OR MARKETING COMMUNICATIONS CONCERNING DEBT SETTLEMENT
 SERVICES.

 A. 3525                            13
 
   2.  ALL  ADVERTISING  AND  MARKETING  COMMUNICATIONS  CONCERNING  DEBT
 SETTLEMENT SERVICES SHALL DISCLOSE THE FOLLOWING INFORMATION CLEARLY AND
 CONSPICUOUSLY:  "DEBT SETTLEMENT SERVICES ARE NOT APPROPRIATE FOR EVERY-
 ONE. FAILURE TO PAY YOUR MONTHLY BILLS IN A TIMELY MANNER WILL RESULT IN
 INCREASED  BALANCES  AND WILL HARM YOUR CREDIT RATING. NOT ALL CREDITORS
 WILL AGREE TO REDUCE THE AMOUNT YOU OWE, AND THEY MAY PURSUE COLLECTION,
 INCLUDING LAWSUITS."
   3. ALL ADVERTISING AND MARKETING COMMUNICATIONS  OF  A  LICENSED  DEBT
 SETTLEMENT  COMPANY  CONCERNING  DEBT SETTLEMENT SERVICES SHALL INDICATE
 THAT THE DEBT SETTLEMENT COMPANY IS LICENSED BY THE DEPARTMENT AND SHALL
 CONTAIN THE NAME AND OFFICE ADDRESS OF  SUCH  DEBT  SETTLEMENT  COMPANY,
 WHICH SHALL CONFORM TO A NAME AND ADDRESS ON RECORD WITH THE DEPARTMENT.
   §  588-J.  INDIVIDUALIZED  FINANCIAL  ANALYSIS; STATEMENT. 1. PRIOR TO
 ENTERING INTO A DEBT SETTLEMENT SERVICES AGREEMENT,  A  DEBT  SETTLEMENT
 COMPANY  SHALL PREPARE AND PROVIDE TO THE DEBTOR IN WRITING AND RETAIN A
 COPY OF:
   (A) AN INDIVIDUALIZED FINANCIAL ANALYSIS, INCLUDING A LISTING  OF  THE
 DEBTOR'S INCOME, EXPENSES, AND DEBTS; AND
   (B) A STATEMENT CONTAINING:
   (I)  A  DESCRIPTION  OF THE SERVICES TO BE PROVIDED UNDER THE PROPOSED
 DEBT SETTLEMENT SERVICES AGREEMENT;
   (II) A GOOD FAITH ESTIMATE OF THE TIME IT WILL TAKE  TO  COMPLETE  ALL
 STEPS  NECESSARY  FOR  A  SETTLEMENT  OF  EACH  DEBT  INCLUDED UNDER THE
 PROPOSED DEBT SETTLEMENT SERVICES AGREEMENT;
   (III) THE TOTAL AMOUNT OF DEBT OWED TO EACH  CREDITOR  INCLUDED  UNDER
 THE PROPOSED DEBT SETTLEMENT SERVICES AGREEMENT;
   (IV)  THE  TOTAL AMOUNT OF MONEY ESTIMATED TO BE NECESSARY TO COMPLETE
 ALL STEPS NECESSARY FOR A SETTLEMENT OF EACH  DEBT  INCLUDED  UNDER  THE
 PROPOSED DEBT SETTLEMENT SERVICES AGREEMENT; AND
   (V)  THE  MONTHLY  TARGETED  AMOUNT OF MONEY NECESSARY TO COMPLETE ALL
 STEPS NECESSARY FOR  A  SETTLEMENT  OF  EACH  DEBT  INCLUDED  UNDER  THE
 PROPOSED DEBT SETTLEMENT SERVICES AGREEMENT.
   2.  A  DEBT  SETTLEMENT COMPANY SHALL NOT ENTER INTO A DEBT SETTLEMENT
 SERVICES AGREEMENT UNLESS IT MAKES WRITTEN DETERMINATIONS, SUPPORTED  BY
 THE FINANCIAL ANALYSIS, THAT:
   (A)  THE  DEBTOR CAN REASONABLY MEET THE REQUIREMENTS OF SUCH PROPOSED
 DEBT SETTLEMENT SERVICES AGREEMENT, INCLUDING THE FEES AND  THE  SAVINGS
 GOALS; AND
   (B)  SUCH PROPOSED DEBT SETTLEMENT SERVICES AGREEMENT WILL BE SUITABLE
 FOR THE DEBTOR AT THE TIME IT IS TO BE SIGNED.
   § 588-K. REQUIRED PRE-AGREEMENT DISCLOSURES AND  WARNINGS.  1.  BEFORE
 THE  DEBTOR SIGNS A DEBT SETTLEMENT SERVICES AGREEMENT, THE DEBT SETTLE-
 MENT COMPANY SHALL PROVIDE AN ORAL AND WRITTEN NOTICE TO THE DEBTOR THAT
 CLEARLY AND CONSPICUOUSLY DISCLOSES ALL OF THE FOLLOWING:
   (A) DEBT SETTLEMENT SERVICES MAY NOT BE SUITABLE FOR ALL DEBTORS;
   (B) USING DEBT SETTLEMENT SERVICES LIKELY WILL HARM THE DEBTOR'S CRED-
 IT HISTORY, CREDIT RATING, AND CREDIT SCORE;
   (C) USING DEBT SETTLEMENT SERVICES DOES NOT STOP  CREDITOR  COLLECTION
 ACTIVITY, INCLUDING CREDITOR LAWSUITS AND GARNISHMENTS;
   (D) NOT ALL CREDITORS WILL ACCEPT A REDUCTION IN THE BALANCE, INTEREST
 RATE, OR FEES A DEBTOR OWES;
   (E)  THE DEBTOR SHOULD INQUIRE ABOUT OTHER MEANS OF DEALING WITH DEBT,
 INCLUDING BUT NOT LIMITED TO BUDGET PLANNING AND BANKRUPTCY;
   (F) THE  DEBTOR  REMAINS  OBLIGATED  TO  MAKE  PERIODIC  OR  SCHEDULED
 PAYMENTS TO CREDITORS WHILE PARTICIPATING IN A DEBT SETTLEMENT PROGRAM;

 A. 3525                            14
 
   (G)  THE  FAILURE TO MAKE PERIODIC OR SCHEDULED PAYMENTS TO A CREDITOR
 IS LIKELY TO:
   (I)  HARM  THE  DEBTOR'S  CREDIT HISTORY, CREDIT RATING, AND/OR CREDIT
 SCORE;
   (II) LEAD THE CREDITOR TO INCREASE LAWFUL COLLECTION ACTIVITY, INCLUD-
 ING LITIGATION, GARNISHMENT OF THE DEBTOR'S WAGES, AND JUDGMENT LIENS ON
 THE DEBTOR'S PROPERTY; AND
   (III) LEAD TO THE IMPOSITION BY THE CREDITOR OF INTEREST CHARGES, LATE
 FEES, AND OTHER PENALTY FEES, INCREASING THE AMOUNT OWED BY THE  DEBTOR;
 AND
   (H) THE DEBTOR MAY BE REQUIRED TO PAY TAXES ON ANY AMOUNT OF DEBT THAT
 IS FORGIVEN.
   2.  THE  WRITTEN  NOTICE  REQUIRED  BY SUBDIVISION ONE OF THIS SECTION
 SHALL BE ENTITLED "DEBTOR NOTICE AND RIGHTS FORM".
   3. PRIOR TO SIGNING A DEBT SETTLEMENT SERVICES AGREEMENT,  THE  DEBTOR
 SHALL  SIGN  AND  DATE  AN  ACKNOWLEDGMENT FORM AT THE END OF THE DEBTOR
 NOTICE AND RIGHTS FORM.  THE ACKNOWLEDGMENT FORM SHALL  STATE:  "I,  THE
 DEBTOR,  HAVE  RECEIVED  FROM  THE DEBT SETTLEMENT COMPANY A COPY OF THE
 FORM ENTITLED DEBTOR NOTICE AND RIGHTS FORM." THE DEBT SETTLEMENT COMPA-
 NY OR ITS REPRESENTATIVE SHALL ALSO SIGN  AND  DATE  THE  ACKNOWLEDGMENT
 FORM,  WHICH  SHALL  INCLUDE THE NAME AND ADDRESS OF THE DEBT SETTLEMENT
 COMPANY. THE ACKNOWLEDGMENT FORM SHALL BE IN DUPLICATE AND  INCORPORATED
 INTO THE DEBTOR NOTICE AND RIGHTS FORM. THE ORIGINAL ACKNOWLEDGMENT FORM
 SHALL BE RETAINED BY THE DEBT SETTLEMENT COMPANY, AND THE DUPLICATE COPY
 SHALL BE GIVEN TO THE DEBTOR.
   4.  THE REQUIREMENTS OF THIS SECTION ARE SATISFIED IF THE DEBT SETTLE-
 MENT COMPANY GIVES THE DEBTOR THE FOLLOWING WARNING VERBATIM, BOTH ORAL-
 LY AND IN WRITING, WITH THE CAPTION "DEBTOR NOTICE AND RIGHTS  FORM"  IN
 AT  LEAST  TWENTY-EIGHT-POINT FONT AND THE REMAINING PORTION IN AT LEAST
 FOURTEEN-POINT FONT, BEFORE THE DEBTOR SIGNS A DEBT SETTLEMENT  SERVICES
 AGREEMENT:
 
                      "DEBTOR NOTICE AND RIGHTS FORM
                                  CAUTION
   USING  DEBT  SETTLEMENT SERVICES WILL LIKELY HARM YOUR CREDIT HISTORY,
 CREDIT RATING, AND CREDIT SCORE.
   WE CANNOT GUARANTEE THAT YOU WILL  SUCCESSFULLY  REDUCE  OR  ELIMINATE
 YOUR DEBT.
   YOU  REMAIN OBLIGATED TO MAKE PAYMENTS TO YOUR CREDITORS.  IF YOU STOP
 PAYING YOUR CREDITORS, THERE IS A STRONG LIKELIHOOD SOME OR ALL  OF  THE
 FOLLOWING MAY HAPPEN:
   - CREDITORS MAY STILL CONTACT YOU AND TRY TO COLLECT.
   - CREDITORS MAY STILL SUE YOU FOR THE MONEY YOU OWE.
   - YOUR WAGES OR BANK ACCOUNT MAY STILL BE GARNISHED.
   - LIENS MAY STILL BE PLACED ON YOUR PROPERTY.
   -  YOUR CREDIT HISTORY, CREDIT RATING, AND/OR CREDIT SCORE LIKELY WILL
 BE HARMED.
   - THE AMOUNT OF MONEY YOU OWE MAY INCREASE DUE TO CREDITOR  IMPOSITION
 OF INTEREST CHARGES, LATE FEES, AND OTHER PENALTY FEES.
   - NOT ALL CREDITORS WILL AGREE TO ACCEPT A BALANCE REDUCTION.
   IF  WE  DO  SETTLE  YOUR DEBT, YOU MAY BE REQUIRED TO PAY TAXES ON THE
 AMOUNT FORGIVEN.
   DEBT SETTLEMENT SERVICES  ARE  NOT  RIGHT  FOR  EVERYONE.  YOU  SHOULD
 CONSIDER ALL YOUR OPTIONS FOR ADDRESSING YOUR DEBT, SUCH AS BUDGET PLAN-
 NING OR A BANKRUPTCY FILING.
   YOUR RIGHT TO CANCEL

 A. 3525                            15
 
   IF  YOU  SIGN A DEBT SETTLEMENT SERVICES AGREEMENT, YOU HAVE THE RIGHT
 TO CANCEL AT ANY TIME AND RECEIVE A FULL REFUND OF ALL UNEARNED FEES YOU
 HAVE PAID TO THE DEBT SETTLEMENT COMPANY AND ALL FUNDS  PLACED  IN  YOUR
 DEBTOR  SETTLEMENT  ACCOUNT THAT HAVE NOT BEEN PAID TO ANY CREDITORS. IF
 YOU  CANCEL  WITHIN  NINETY DAYS OF SIGNING THE DEBT SETTLEMENT SERVICES
 AGREEMENT YOU ALSO HAVE THE RIGHT  TO  RECEIVE  A  FULL  REFUND  OF  ANY
 ENROLLMENT FEES YOU HAVE PAID.
   ACKNOWLEDGMENT BY DEBTOR
   I,  THE  DEBTOR, HAVE RECEIVED FROM THE DEBT SETTLEMENT COMPANY A COPY
 OF THE FORM ENTITLED DEBTOR NOTICE AND RIGHTS FORM."
   § 588-L. DEBT SETTLEMENT SERVICES AGREEMENTS.  1.  A  DEBT  SETTLEMENT
 COMPANY SHALL NOT PROVIDE DEBT SETTLEMENT SERVICES TO A DEBTOR WITHOUT A
 WRITTEN  DEBT SETTLEMENT SERVICES AGREEMENT SIGNED AND DATED BY BOTH THE
 DEBTOR AND THE DEBT SETTLEMENT COMPANY.
   2. ANY DEBT SETTLEMENT SERVICES AGREEMENT ENTERED INTO IN VIOLATION OF
 THE PROVISIONS OF THIS SECTION IS VOID.
   3. EACH DEBT SETTLEMENT COMPANY SHALL SUBMIT TO THE BANKING DEPARTMENT
 ANY FORM OF DEBT SETTLEMENT SERVICES AGREEMENT IT INTENDS TO USE.
   4. A DEBT SETTLEMENT SERVICES AGREEMENT  SHALL  DISCLOSE  ALL  OF  THE
 FOLLOWING CLEARLY AND CONSPICUOUSLY:
   (A) THE NAME AND ADDRESS OF THE DEBTOR;
   (B) THE DATE OF EXECUTION OF THE DEBT SETTLEMENT SERVICES AGREEMENT;
   (C) THE LEGAL NAME OF THE DEBT SETTLEMENT COMPANY, INCLUDING ANY OTHER
 BUSINESS NAMES USED IN THIS STATE BY THE DEBT SETTLEMENT COMPANY;
   (D)  THE COMPLETE STREET ADDRESS OF THE DEBT SETTLEMENT COMPANY, WHICH
 SHALL CONFORM TO AN ADDRESS ON RECORD WITH THE DEPARTMENT;
   (E) THE LICENSE NUMBER OF THE PRINCIPAL OFFICE AND, IF APPLICABLE,  OF
 THE BRANCH OFFICE UNDER WHICH THE DEBT SETTLEMENT COMPANY IS LICENSED IN
 THIS STATE;
   (F)  A TOLL-FREE TELEPHONE NUMBER AT WHICH THE DEBTOR MAY SPEAK WITH A
 REPRESENTATIVE OF THE DEBT SETTLEMENT  COMPANY  DURING  NORMAL  BUSINESS
 HOURS;
   (G)  A  COMPLETE LIST OF THE DEBTOR'S ACCOUNTS, DEBTS, AND OBLIGATIONS
 COVERED BY THE DEBT SETTLEMENT SERVICES AGREEMENT, INCLUDING THE NAME OF
 EACH CREDITOR AND THE PRINCIPAL AMOUNT OF EACH DEBT;
   (H) A DESCRIPTION OF THE SERVICES TO BE PROVIDED BY THE  DEBT  SETTLE-
 MENT  COMPANY, INCLUDING THE EXPECTED TIME FRAME FOR SETTLEMENT FOR EACH
 ACCOUNT, DEBT, OR OBLIGATION INCLUDED IN PARAGRAPH (G) OF THIS  SUBDIVI-
 SION;
   (I)  AN  ITEMIZED  LIST  OF ALL FEES, INCLUDING ANY ENROLLMENT FEE AND
 SETTLEMENT FEES TO BE PAID BY THE DEBTOR TO THE DEBT SETTLEMENT COMPANY,
 AND THE DATE, APPROXIMATE DATE, OR CIRCUMSTANCES UNDER  WHICH  EACH  FEE
 WILL BECOME DUE;
   (J)  A  GOOD  FAITH  ESTIMATE  OF  THE  TOTAL AMOUNT OF ALL FEES TO BE
 COLLECTED BY THE  DEBT  SETTLEMENT  COMPANY  FROM  THE  DEBTOR  FOR  THE
 PROVISION OF DEBT SETTLEMENT SERVICES UNDER THE DEBT SETTLEMENT SERVICES
 AGREEMENT;
   (K) A STATEMENT OF THE PROPOSED SAVINGS GOALS FOR THE DEBTOR, STATING:
   (I) THE AMOUNT TO BE SAVED PER MONTH;
   (II) THE TIME PERIOD OVER WHICH THE SAVINGS GOALS EXTEND;
   (III)  THE  AMOUNT  OF  MONEY THE DEBTOR MUST SAVE BEFORE A SETTLEMENT
 OFFER WILL BE MADE TO EACH OF THE DEBTOR'S CREDITORS; AND
   (IV) THE TOTAL AMOUNT OF THE SAVINGS EXPECTED TO BE PAID BY THE DEBTOR
 PURSUANT TO THE TERMS OF THE DEBT SETTLEMENT SERVICES AGREEMENT;
   (L) THE WRITTEN INDIVIDUALIZED FINANCIAL ANALYSIS REQUIRED BY  SECTION
 FIVE HUNDRED EIGHTY-EIGHT-J OF THIS ARTICLE;

 A. 3525                            16
 
   (M) A WRITTEN NOTICE TO THE DEBTOR STATING:
   (I)  THAT THE DEBTOR MAY CANCEL THE DEBT SETTLEMENT SERVICES AGREEMENT
 AT ANY TIME; AND
   (II) THAT UPON SUCH CANCELLATION:
   (A) ALL POWERS OF ATTORNEY GRANTED TO THE DEBT SETTLEMENT  COMPANY  BY
 THE DEBTOR SHALL BE CONSIDERED REVOKED AND VOIDED; AND
   (B)  THE  DEBTOR MAY BE ENTITLED TO A REFUND. THE TERMS OF SUCH REFUND
 SHALL ALSO BE STATED AND SHALL BE CONSISTENT WITH  THE  REQUIREMENTS  OF
 SECTION FIVE HUNDRED EIGHTY-EIGHT-O OF THIS ARTICLE.
   (N)  A  FORM THE DEBTOR MAY USE TO CANCEL THE DEBT SETTLEMENT SERVICES
 AGREEMENT PURSUANT TO THE PROVISIONS OF  SECTION  FIVE  HUNDRED  EIGHTY-
 EIGHT-O  OF  THIS ARTICLE. THE FORM SHALL DISCLOSE CLEARLY AND CONSPICU-
 OUSLY HOW THE DEBTOR CAN CANCEL THE DEBT SETTLEMENT SERVICES  AGREEMENT,
 INCLUDING  APPLICABLE  ADDRESSES,  TELEPHONE NUMBERS, FACSIMILE NUMBERS,
 AND ELECTRONIC MAIL ADDRESSES THE DEBTOR CAN  USE  TO  CANCEL  THE  DEBT
 SETTLEMENT SERVICES AGREEMENT;
   (O)  A  CLEAR AND CONSPICUOUS NOTICE TO THE DEBTOR THAT THE DEBTOR MAY
 CONTACT THE DEPARTMENT WITH ANY QUESTIONS OR  COMPLAINTS  REGARDING  THE
 DEBT  SETTLEMENT  COMPANY  ALONG  WITH THE ADDRESS, TELEPHONE NUMBER AND
 INTERNET WEBSITE OF THE DEPARTMENT.
   5. (A) A DEBT SETTLEMENT SERVICES  AGREEMENT  MAY  CONFER  ON  A  DEBT
 SETTLEMENT  COMPANY  A POWER OF ATTORNEY TO SETTLE THE DEBTOR'S DEBT FOR
 NO MORE THAN FIFTY PERCENT OF THE  PRINCIPAL  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 DEBTOR ON BEHALF OF THE DEBTOR.  A  DEBT
 SETTLEMENT  SERVICES  AGREEMENT  MUST  PROVIDE  THAT THE DEBT SETTLEMENT
 COMPANY WILL OBTAIN THE ASSENT  OF  THE  DEBTOR  AFTER  A  CREDITOR  HAS
 ASSENTED  TO  A  SETTLEMENT FOR MORE THAN FIFTY PERCENT OF THE PRINCIPAL
 AMOUNT OF THE DEBT.
   (B) A DEBT SETTLEMENT SERVICES AGREEMENT MAY NOT PROVIDE FOR  APPLICA-
 TION  OF  THE  LAW  OF ANY JURISDICTION OTHER THAN THE UNITED STATES AND
 THIS STATE.
   6. IF A DEBT SETTLEMENT COMPANY COMMUNICATES WITH A  DEBTOR  PRIMARILY
 IN A LANGUAGE OTHER THAN ENGLISH, THEN THE DEBT SETTLEMENT COMPANY SHALL
 FURNISH  TO  THE  DEBTOR A WRITTEN TRANSLATION IN THAT OTHER LANGUAGE OF
 ALL THE DISCLOSURES AND DOCUMENTS REQUIRED BY THIS ARTICLE.
   § 588-M. FEES. 1. THE TYPES OF FEES THAT A DEBT SETTLEMENT COMPANY MAY
 CHARGE A DEBTOR ARE THE FOLLOWING:
   (A) ENROLLMENT FEES; AND
   (B) SETTLEMENT FEES.
   2. ALL FEE TYPES NOT INCLUDED UNDER SUBDIVISION ONE  OF  THIS  SECTION
 ARE PROHIBITED, INCLUDING MAINTENANCE FEES.
   3. THE AMOUNT OF AN ENROLLMENT FEE CHARGED BY A DEBT SETTLEMENT COMPA-
 NY  SHALL  NOT  EXCEED  FIFTY DOLLARS OR SUCH OTHER AMOUNT AS SET BY THE
 SUPERINTENDENT.
   4. THE AMOUNT OF THE SETTLEMENT  FEE  CHARGED  BY  A  DEBT  SETTLEMENT
 COMPANY  WITH RESPECT TO EACH DEBT COVERED BY A DEBT SETTLEMENT SERVICES
 AGREEMENT SHALL NOT EXCEED THE LESSER OF:
   (A) THE AMOUNT THAT IS REASONABLE AND COMMENSURATE TO THE DEBT SETTLE-
 MENT SERVICES PROVIDED TO THE DEBTOR; AND
   (B) THE AMOUNT THAT IS TWENTY PERCENT OF THE DIFFERENCE BETWEEN:
   (I) THE PRINCIPAL AMOUNT OF THE DEBT; AND
   (II) THE AMOUNT:
   (A) PAID BY THE DEBT SETTLEMENT COMPANY TO THE  CREDITOR  PURSUANT  TO
 THE  SETTLEMENT  NEGOTIATED  BY THE DEBT SETTLEMENT COMPANY ON BEHALF OF

 A. 3525                            17
 
 THE DEBTOR AS FULL AND COMPLETE SATISFACTION  OF  THE  CREDITOR'S  CLAIM
 WITH REGARD TO THAT DEBT; OR
   (B)  NEGOTIATED  BY THE DEBT SETTLEMENT COMPANY AND PAID BY THE DEBTOR
 TO THE CREDITOR PURSUANT TO A SETTLEMENT NEGOTIATED BY THE DEBT  SETTLE-
 MENT  COMPANY  ON BEHALF OF THE DEBTOR AS FULL AND COMPLETE SATISFACTION
 OF THE CREDITOR'S CLAIM WITH REGARD TO THAT DEBT.
   5. A DEBT SETTLEMENT COMPANY SHALL NOT COLLECT ANY SETTLEMENT FEE FROM
 A DEBTOR UNTIL:
   (A) THE CREDITOR ENTERS INTO A LEGALLY ENFORCEABLE AGREEMENT WITH  THE
 DEBTOR  TO ACCEPT FUNDS IN A SPECIFIC DOLLAR AMOUNT AS FULL AND COMPLETE
 SATISFACTION OF THE CREDITOR'S CLAIM WITH REGARD TO THAT DEBT; AND
   (B) THOSE FUNDS ARE PROVIDED TO THE CREDITOR:
   (I) BY THE DEBT SETTLEMENT COMPANY ON BEHALF OF THE DEBTOR; OR
   (II) DIRECTLY BY THE DEBTOR PURSUANT TO A SETTLEMENT NEGOTIATED BY THE
 DEBT SETTLEMENT COMPANY.
   6. IT SHALL BE UNLAWFUL TO SPLIT  OR  DIVIDE  THE  PROVISION  OF  DEBT
 SETTLEMENT  SERVICES  TO A DEBTOR INTO SEPARATE DEBT SETTLEMENT SERVICES
 AGREEMENTS FOR THE PURPOSE  OF  COLLECTING  ADDITIONAL  FEES  FROM  SUCH
 DEBTOR.
   §  588-N.  DEBTOR  SETTLEMENT  ACCOUNTS; MONTHLY ACCOUNTING. 1. A DEBT
 SETTLEMENT COMPANY THAT RECEIVES FUNDS FROM  A  DEBTOR  SHALL  HOLD  ALL
 FUNDS  RECEIVED FOR A DEBTOR SETTLEMENT ACCOUNT IN A PROPERLY DESIGNATED
 BANK ACCOUNT IN A FEDERALLY INSURED DEPOSITORY INSTITUTION.
   (A) SUCH FUNDS SHALL:
   (I) CONSTITUTE TRUST FUNDS OWNED BY THE DEBTOR  FROM  WHOM  THEY  WERE
 RECEIVED;
   (II)  REMAIN  THE  PROPERTY  OF  SUCH DEBTOR UNTIL THE DEBT SETTLEMENT
 COMPANY DISBURSES THE FUNDS TO A CREDITOR ON BEHALF OF SUCH DEBTOR;
   (III) BE KEPT SEPARATE AND APART AT ALL TIMES FROM FUNDS BELONGING  TO
 THE  DEBT  SETTLEMENT  COMPANY  OR  ANY  OF  ITS OFFICERS, EMPLOYEES, OR
 AGENTS; AND
   (IV) BE DEPOSITED IN SUCH BANK ACCOUNT NOT LATER THAN THE END  OF  THE
 BUSINESS  DAY  FOLLOWING  RECEIPT  BY THE DEBT SETTLEMENT COMPANY OR ITS
 AGENT.
   (B) A DEBT SETTLEMENT COMPANY OR ITS AGENT THAT MAINTAINS ONE OR  MORE
 DEBTOR SETTLEMENT ACCOUNTS SHALL OBTAIN AND PRESERVE A WRITTEN AGREEMENT
 FROM  EACH  BANK  IN  WHICH ANY SUCH ACCOUNT IS MAINTAINED. SUCH WRITTEN
 AGREEMENT SHALL EXPRESSLY PROVIDE THAT THE FUNDS IN SUCH DEBTOR  SETTLE-
 MENT  ACCOUNT  SHALL  BE SUBJECT TO NO RIGHT, CHARGE, SECURITY INTEREST,
 LIEN, OR CLAIM OF ANY KIND IN FAVOR OF SUCH BANK OR ANY PERSON  CLAIMING
 THROUGH SUCH BANK.
   (C)  ANY INTEREST EARNED ON A DEBTOR SETTLEMENT ACCOUNT SHALL BE CRED-
 ITED TO THE DEBTOR. IF THE FUNDS OF  MULTIPLE  DEBTORS  ARE  KEPT  IN  A
 SINGLE  INTEREST EARNING BANK ACCOUNT, THEN THE INTEREST EARNED SHALL BE
 DEPOSITED PRO RATA AMONG THE DEBTORS WHOSE FUNDS ARE IN THE ACCOUNT.
   (D) A DEBT SETTLEMENT COMPANY MAY NOT HOLD FUNDS RECEIVED FOR A DEBTOR
 SETTLEMENT ACCOUNT IN AN ACCOUNT ADMINISTERED BY A PERSON THAT GIVES  OR
 ACCEPTS  ANY  MONEY  OR  OTHER COMPENSATION IN EXCHANGE FOR REFERRALS OF
 BUSINESS INVOLVING THE DEBT SETTLEMENT COMPANY.
   2. A DEBT SETTLEMENT COMPANY SHALL, NO LESS THAN MONTHLY, PROVIDE EACH
 DEBTOR WITH WHICH IT HAS A DEBT SETTLEMENT SERVICES AGREEMENT  A  STATE-
 MENT  OF FEES PAID, SETTLEMENTS COMPLETED, REMAINING DEBTS AND, IF FUNDS
 ARE HELD IN A BANK ACCOUNT PURSUANT TO SUBDIVISION ONE OF THIS  SECTION,
 ACCOUNT BALANCES.
   3.  NOTHING  IN  THIS  ARTICLE  REQUIRES THE ESTABLISHMENT OF A DEBTOR
 SETTLEMENT ACCOUNT IF NO DEBTOR FUNDS  OTHER  THAN  ENROLLMENT  FEES  OR

 A. 3525                            18
 
 EARNED  SETTLEMENT  FEES  ARE  HELD  OR  CONTROLLED BY A DEBT SETTLEMENT
 COMPANY.
   §  588-O. CANCELLATION OF DEBT SETTLEMENT SERVICES AGREEMENT; RIGHT TO
 REFUNDS. 1.  A DEBTOR MAY CANCEL A DEBT SETTLEMENT SERVICES AGREEMENT AT
 ANY TIME UNTIL AFTER THE DEBT SETTLEMENT  COMPANY  HAS  FULLY  PERFORMED
 EACH  SERVICE  THE  DEBT  SETTLEMENT  COMPANY  CONTRACTED  TO PERFORM OR
 REPRESENTED THAT IT WOULD PERFORM.
   2. IF A DEBTOR CANCELS A DEBT SETTLEMENT SERVICES AGREEMENT NOT  LATER
 THAN  NINETY DAYS AFTER THE DATE OF THE EXECUTION OF THE DEBT SETTLEMENT
 SERVICES AGREEMENT OR AT ANY TIME UPON A VIOLATION  OF  A  PROVISION  OF
 THIS ARTICLE BY THE DEBT SETTLEMENT COMPANY, THE DEBT SETTLEMENT COMPANY
 SHALL REFUND TO THE DEBTOR:
   (A)  ALL  FEES PAID TO THE DEBT SETTLEMENT COMPANY BY THE DEBTOR, WITH
 THE EXCEPTION OF ANY EARNED SETTLEMENT FEE; AND
   (B) ALL FUNDS PROVIDED BY THE DEBTOR TO THE  DEBT  SETTLEMENT  COMPANY
 THAT:
   (I) HAVE ACCUMULATED IN A DEBTOR SETTLEMENT ACCOUNT; AND
   (II) THE DEBT SETTLEMENT COMPANY HAS NOT DISBURSED TO CREDITORS.
   3. IF A DEBTOR CANCELS A DEBT SETTLEMENT SERVICES AGREEMENT LATER THAN
 NINETY  DAYS  AFTER  THE  DATE  OF  THE EXECUTION OF THE DEBT SETTLEMENT
 SERVICES AGREEMENT AND FOR ANY REASON OTHER THAN FOR A  VIOLATION  OF  A
 PROVISION  OF  THIS  ARTICLE  BY  THE  DEBT SETTLEMENT COMPANY, THE DEBT
 SETTLEMENT COMPANY SHALL REFUND TO THE DEBTOR:
   (A) ALL FEES PAID TO THE DEBT SETTLEMENT COMPANY BY THE  DEBTOR,  WITH
 THE EXCEPTION OF ANY EARNED SETTLEMENT FEE AND ANY ENROLLMENT FEE; AND
   (B)  ALL  FUNDS  PROVIDED BY THE DEBTOR TO THE DEBT SETTLEMENT COMPANY
 THAT:
   (I) HAVE ACCUMULATED IN A DEBTOR SETTLEMENT ACCOUNT; AND
   (II) THE DEBT SETTLEMENT COMPANY HAS NOT DISBURSED TO CREDITORS.
   4. A DEBT SETTLEMENT COMPANY SHALL MAKE ANY REFUND REQUIRED UNDER THIS
 SECTION WITHIN FIVE BUSINESS DAYS AFTER RECEIPT  OF  WRITTEN  NOTICE  OF
 CANCELLATION,  AND  SHALL  INCLUDE  WITH SUCH REFUND A FULL STATEMENT OF
 ACCOUNT SHOWING:
   (A) THE FEES RECEIVED BY THE DEBT SETTLEMENT COMPANY FROM THE DEBTOR;
   (B) THE FEES REFUNDED TO THE DEBTOR BY THE DEBT SETTLEMENT COMPANY;
   (C) THE PAYMENTS MADE BY THE DEBT SETTLEMENT COMPANY TO  CREDITORS  ON
 BEHALF OF THE DEBTOR;
   (D) THE SETTLEMENT FEES EARNED, IF ANY, BY THE DEBT SETTLEMENT COMPANY
 BY SETTLING DEBT ON BEHALF OF THE DEBTOR;
   (E)  THE  SAVINGS  OF  THE  DEBTOR HELD BY THE DEBT SETTLEMENT COMPANY
 IMMEDIATELY PRIOR TO SUCH REFUND; AND
   (F) THE SAVINGS OF THE DEBTOR REFUNDED  TO  THE  DEBTOR  BY  THE  DEBT
 SETTLEMENT COMPANY.
   5.  UPON  CANCELLATION  OF A DEBT SETTLEMENT SERVICES AGREEMENT BY THE
 DEBTOR:
   (A) ALL POWERS OF ATTORNEY AND DIRECT DEBIT AUTHORIZATIONS GRANTED  TO
 THE  DEBT  SETTLEMENT  COMPANY BY THE DEBTOR SHALL BE CONSIDERED REVOKED
 AND VOIDED; AND
   (B) THE DEBT SETTLEMENT COMPANY  SHALL  IMMEDIATELY  TAKE  ANY  ACTION
 NECESSARY TO REFLECT CANCELLATION OF THE DEBT SETTLEMENT SERVICES AGREE-
 MENT, INCLUDING BUT NOT LIMITED TO NOTIFYING THE RECIPIENT OF ANY DIRECT
 DEBIT AUTHORIZATION.
   6.  UPON THE CANCELLATION OF A DEBT SETTLEMENT SERVICES AGREEMENT, THE
 DEBT SETTLEMENT COMPANY SHALL  PROVIDE  TIMELY  WRITTEN  NOTICE  OF  THE
 CANCELLATION  OF  SUCH  AGREEMENT TO EACH OF THE CREDITORS WITH WHOM THE

 A. 3525                            19
 
 DEBT SETTLEMENT COMPANY HAS HAD ANY PRIOR COMMUNICATION ON BEHALF OF THE
 DEBTOR IN CONNECTION WITH THE PROVISION OF ANY DEBT SETTLEMENT SERVICES.
   § 588-P. OBLIGATION OF GOOD FAITH. A DEBT SETTLEMENT COMPANY SHALL ACT
 IN GOOD FAITH IN ALL MATTERS UNDER THIS ARTICLE.
   §  588-Q.  PROHIBITED ACTIVITIES. 1. NO PERSON, EXCEPT A LICENSEE, MAY
 MAKE ANY REPRESENTATION, DIRECTLY OR INDIRECTLY, ORALLY  OR  IN  WRITING
 THAT HE, SHE, OR IT IS LICENSED UNDER THIS ARTICLE.
   2.  NO  PERSON,  OTHER  THAN  A  LICENSEE  OR A PERSON EXEMPT FROM THE
 LICENSING REQUIREMENTS OF  THIS  ARTICLE,  SHALL  USE  THE  TITLE  "DEBT
 SETTLEMENT  COMPANY"  OR THE TERMS "DEBT SETTLEMENT" OR "DEBT SETTLEMENT
 SERVICES" IN ANY ADVERTISING, MARKETING COMMUNICATION, BUSINESS CARD, OR
 LETTERHEAD.
   3. A DEBT SETTLEMENT COMPANY SHALL NOT DO ANY OF THE FOLLOWING:
   (A) CHARGE OR COLLECT FROM A DEBTOR ANY FEE NOT PERMITTED  BY,  IN  AN
 AMOUNT IN EXCESS OF THE MAXIMUM AMOUNT PERMITTED BY, OR AT A TIME EARLI-
 ER  THAN  PERMITTED BY SECTION FIVE HUNDRED EIGHTY-EIGHT-M OF THIS ARTI-
 CLE;
   (B) INCLUDE IN A DEBT SETTLEMENT SERVICES AGREEMENT ANY SECURED DEBT;
   (C) ADVISE OR REPRESENT, EXPRESSLY OR  BY  IMPLICATION,  THAT  DEBTORS
 SHOULD STOP MAKING PAYMENTS TO THEIR CREDITORS;
   (D)  ADVISE  OR  REPRESENT,  EXPRESSLY OR BY IMPLICATION, THAT DEBTORS
 SHOULD STOP COMMUNICATING WITH THEIR CREDITORS;
   (E) ENGAGE IN ANY PRACTICE THAT PROHIBITS OR LIMITS THE DEBTOR OR  ANY
 CREDITOR FROM COMMUNICATION DIRECTLY WITH ONE ANOTHER;
   (F)  CHANGE THE MAILING ADDRESS ON ANY OF A DEBTOR'S STATEMENTS FROM A
 CREDITOR;
   (G) MAKE LOANS OR OFFER CREDIT OR SOLICIT OR ACCEPT  ANY  NOTE,  MORT-
 GAGE,  OR  NEGOTIABLE INSTRUMENT OTHER THAN A CHECK SIGNED BY THE DEBTOR
 AND DATED NO LATER THAN THE DATE OF SIGNATURE;
   (H) TAKE ANY CONFESSION OF JUDGMENT OR POWER OF  ATTORNEY  TO  CONFESS
 JUDGMENT  AGAINST THE DEBTOR OR APPEAR AS THE DEBTOR OR ON BEHALF OF THE
 DEBTOR IN ANY JUDICIAL, ADMINISTRATIVE, OR OTHER ACTION OR PROCEEDING;
   (I) TAKE ANY RELEASE OR WAIVER OF ANY OBLIGATION TO  BE  PERFORMED  ON
 THE PART OF THE DEBT SETTLEMENT COMPANY OR ANY RIGHT OF THE DEBTOR;
   (J) ADVERTISE, DISPLAY, DISTRIBUTE, BROADCAST, OR TELEVISE SERVICES OR
 PERMIT  SERVICES  TO BE ADVERTISED, DISPLAYED, DISTRIBUTED, BROADCASTED,
 OR TELEVISED,  IN  ANY  MANNER  WHATSOEVER,  THAT  CONTAINS  ANY  FALSE,
 MISLEADING,  OR  DECEPTIVE  STATEMENTS OR REPRESENTATIONS WITH REGARD TO
 ANY MATTER INVOLVING THE BUSINESS OF DEBT SETTLEMENT SERVICES, INCLUDING
 BUT NOT LIMITED TO THE FEES TO BE CHARGED, THE SERVICES TO BE PERFORMED,
 THE RESULTS OR OUTCOMES OF THOSE SERVICES, OR THE EFFECT THOSE  SERVICES
 WILL HAVE ON A DEBTOR'S CREDIT RATING OR ON CREDITOR COLLECTION EFFORTS;
   (K)  RECEIVE  ANY  CASH,  FEE,  GIFT, BONUS, PREMIUM, REWARD, OR OTHER
 COMPENSATION FROM ANY PERSON OTHER THAN THE DEBTOR  EXPLICITLY  FOR  THE
 PROVISION OF DEBT SETTLEMENT SERVICES TO THAT DEBTOR;
   (L)  OFFER  OR  PROVIDE GIFTS OR BONUSES TO DEBTORS FOR SIGNING A DEBT
 SETTLEMENT SERVICES AGREEMENT OR FOR REFERRING ANOTHER POTENTIAL CUSTOM-
 ER OR CUSTOMERS;
   (M) EXCEPT WITH THE PRIOR CONSENT OF THE DEBTOR,  DISCLOSE  TO  ANYONE
 THE  NAME  OR  ANY  PERSONAL  INFORMATION  OF A DEBTOR FOR WHOM THE DEBT
 SETTLEMENT COMPANY HAS PROVIDED OR IS PROVIDING DEBT SETTLEMENT SERVICES
 OTHER THAN TO A DEBTOR'S OWN CREDITORS OR THE DEBT SETTLEMENT  COMPANY'S
 AGENTS  OR  AFFILIATES  FOR  THE  PURPOSE  OF  PROVIDING DEBT SETTLEMENT
 SERVICES. "PERSONAL INFORMATION  OF  A  DEBTOR"  AS  USED  HEREIN  SHALL
 INCLUDE  BUT  NOT  BE  LIMITED  TO A DEBTOR'S NAME, PHOTOGRAPH, ADDRESS,
 TELEPHONE NUMBER, SOCIAL SECURITY NUMBER, DATE OF BIRTH, DRIVER'S  IDEN-

 A. 3525                            20
 
 TIFICATION  NUMBER,  CREDIT  CARD  NUMBER, BANK ACCOUNT NUMBER, MOTHER'S
 MAIDEN NAME, MEDICAL OR DISABILITY INFORMATION, IF ANY, AS WELL  AS  ANY
 OTHER IDENTIFICATION NUMBER WHICH A LICENSEE MAY POSSESS;
   (N)  ENTER  INTO  A  DEBT  SETTLEMENT SERVICES AGREEMENT WITH A DEBTOR
 WITHOUT FIRST PROVIDING  THE  DISCLOSURES  AND  FINANCIAL  ANALYSIS  AND
 MAKING THE DETERMINATIONS REQUIRED BY THIS ARTICLE;
   (O)  MISREPRESENT ANY MATERIAL FACT, MAKE A MATERIAL OMISSION, OR MAKE
 A FALSE PROMISE DIRECTED TO ONE OR MORE DEBTORS IN CONNECTION  WITH  THE
 SOLICITATION,  OFFERING,  CONTRACTING,  OR  PROVISION OF DEBT SETTLEMENT
 SERVICES;
   (P) VIOLATE THE PROVISIONS OF APPLICABLE DO-NOT-CALL STATUTES;
   (Q) PURCHASE DEBTS OR ENGAGE IN  THE  PRACTICE  OR  BUSINESS  OF  DEBT
 COLLECTION;
   (R)  REPRESENT  OR  IMPLY  TO A PERSON PARTICIPATING IN OR CONSIDERING
 DEBT SETTLEMENT SERVICES THAT THE PURCHASE OF  ANY  ANCILLARY  GOODS  OR
 SERVICES IS REQUIRED;
   (S) USE A COMMUNICATION WHICH SIMULATES IN ANY MANNER A LEGAL OR JUDI-
 CIAL  PROCESS,  OR WHICH GIVES THE FALSE APPEARANCE OF BEING AUTHORIZED,
 ISSUED, OR APPROVED BY A GOVERNMENT, GOVERNMENTAL AGENCY,  OR  ATTORNEY-
 AT-LAW; OR
   (T)  MAKE  A  REPRESENTATION  THAT  THE  DEBT  SETTLEMENT COMPANY WILL
 FURNISH MONEY TO PAY BILLS OR PREVENT ATTACHMENT.
   § 588-R. SUPERINTENDENT AUTHORIZED TO  EXAMINE.  FOR  THE  PURPOSE  OF
 DISCOVERING  VIOLATIONS OF THIS ARTICLE OR SECURING INFORMATION LAWFULLY
 REQUIRED BY HIM OR HER HEREUNDER, THE SUPERINTENDENT MAY  AT  ANY  TIME,
 AND  AS  OFTEN  AS  HE  OR  SHE MAY DETERMINE, EITHER PERSONALLY OR BY A
 PERSON DULY DESIGNATED BY HIM OR HER, INVESTIGATE THE BUSINESS AND EXAM-
 INE THE BOOKS, ACCOUNTS, RECORDS, AND FILES USED THEREIN OF EVERY LICEN-
 SEE HEREUNDER. FOR THAT PURPOSE THE SUPERINTENDENT AND HIS OR  HER  DULY
 DESIGNATED  REPRESENTATIVE  SHALL  HAVE  FREE  ACCESS TO THE OFFICES AND
 PLACE OF BUSINESS, BOOKS, ACCOUNTS, PAPERS, RECORDS,  FILES,  SAFES  AND
 VAULTS  OF  ALL  SUCH  LICENSEES. THE SUPERINTENDENT AND ANY PERSON DULY
 DESIGNATED BY HIM OR HER SHALL HAVE AUTHORITY TO REQUIRE THE  ATTENDANCE
 OF  AND  TO EXAMINE UNDER OATH ALL PERSONS WHOSE TESTIMONY HE OR SHE MAY
 REQUIRE RELATIVE TO SUCH BUSINESS. THE EXPENSES INCURRED IN  MAKING  ANY
 EXAMINATION  PURSUANT TO THIS SECTION SHALL BE ASSESSED AGAINST AND PAID
 BY THE LICENSEE SO  EXAMINED,  EXCEPT  THAT  TRAVELING  AND  SUBSISTENCE
 EXPENSES  SO  INCURRED SHALL BE CHARGED AGAINST AND PAID BY LICENSEES IN
 SUCH PROPORTIONS AS THE SUPERINTENDENT SHALL DEEM JUST  AND  REASONABLE,
 AND  SUCH  PROPORTIONATE CHARGES SHALL BE ADDED TO THE ASSESSMENT OF THE
 OTHER EXPENSES INCURRED UPON EACH EXAMINATION. UPON  WRITTEN  NOTICE  BY
 THE  SUPERINTENDENT OF THE TOTAL AMOUNT OF SUCH ASSESSMENT, THE LICENSEE
 SHALL BECOME LIABLE FOR AND SHALL PAY SUCH ASSESSMENT TO THE SUPERINTEN-
 DENT.
   § 588-S. LICENSEE'S BOOKS AND RECORDS; REPORTS. 1. THE LICENSEE  SHALL
 CREATE AND USE IN ITS BUSINESS SUCH BOOKS, ACCOUNTS, AND RECORDS AS WILL
 ENABLE  THE SUPERINTENDENT TO DETERMINE WHETHER SUCH LICENSEE IS COMPLY-
 ING WITH THE PROVISIONS OF THIS ARTICLE AND WITH  THE  RULES  AND  REGU-
 LATIONS  LAWFULLY  MADE  BY THE SUPERINTENDENT HEREUNDER. EVERY LICENSEE
 SHALL PRESERVE SUCH BOOKS, ACCOUNTS, AND RECORDS FOR AT LEAST SIX  YEARS
 BY ANY MANNER PERMITTED BY THIS CHAPTER.
   2.  EACH LICENSEE SHALL ANNUALLY, ON OR BEFORE THE FIRST DAY OF FEBRU-
 ARY, FILE A REPORT WITH THE SUPERINTENDENT GIVING  SUCH  INFORMATION  AS
 THE  SUPERINTENDENT  MAY  REQUIRE CONCERNING THE BUSINESS AND OPERATIONS
 DURING THE PRECEDING CALENDAR YEAR OF SUCH LICENSEE UNDER  AUTHORITY  OF
 THIS  ARTICLE.  SUCH  REPORT SHALL BE SUBSCRIBED AND AFFIRMED AS TRUE BY

 A. 3525                            21
 
 THE LICENSEE UNDER THE PENALTIES OF PERJURY AND SHALL  BE  IN  THE  FORM
 PRESCRIBED  BY  THE  SUPERINTENDENT.  IN ADDITION TO ANNUAL REPORTS, THE
 SUPERINTENDENT MAY REQUIRE SUCH ADDITIONAL REGULAR OR SPECIAL REPORTS AS
 HE  OR  SHE  MAY  DEEM  NECESSARY TO THE PROPER SUPERVISION OF LICENSEES
 UNDER THIS ARTICLE.  SUCH  ADDITIONAL  REPORTS  SHALL  BE  IN  THE  FORM
 PRESCRIBED BY THE SUPERINTENDENT AND SHALL BE SUBSCRIBED AND AFFIRMED AS
 TRUE UNDER THE PENALTIES OF PERJURY.
   3.  EACH  LICENSEE, WITHIN ONE HUNDRED TWENTY DAYS OF THE CLOSE OF THE
 LICENSEE'S FISCAL YEAR, SHALL SUBMIT AN INDEPENDENTLY AUDITED  FINANCIAL
 STATEMENT TO THE SUPERINTENDENT.
   §  588-T.  PENALTIES;  NONCOMPLIANCE.  1.  ANY PERSON WHO VIOLATES ANY
 PROVISION OF THE LICENSING REQUIREMENTS OF SECTION FIVE HUNDRED  EIGHTY-
 EIGHT-B  OF  THIS  ARTICLE  SHALL  BE  GUILTY  OF A CLASS A MISDEMEANOR,
 PUNISHABLE AS PROVIDED IN ARTICLES SEVENTY AND EIGHTY OF THE PENAL LAW.
   2. ANY DEBT SETTLEMENT SERVICES AGREEMENT THAT DOES  NOT  COMPLY  WITH
 THE PROVISIONS OF THIS ARTICLE IS VOID.
   3.  ANY  WAIVER BY A DEBTOR OF ANY PROTECTION PROVIDED BY OR ANY RIGHT
 OF THE DEBTOR UNDER THIS ARTICLE IS VOID.
   4. ANY ATTEMPT BY ANY PERSON TO OBTAIN A WAIVER FROM ANY DEBTOR OF ANY
 PROTECTION PROVIDED BY OR ANY RIGHT OR PROTECTION OF THE DEBTOR  OR  ANY
 OBLIGATION  OR  REQUIREMENT  OF  THE  DEBT SETTLEMENT COMPANY UNDER THIS
 ARTICLE SHALL BE A VIOLATION OF THIS ARTICLE.
   5. UPON PROPER NOTICE OF A VOID DEBT  SETTLEMENT  SERVICES  AGREEMENT,
 THE  DEBT SETTLEMENT COMPANY SHALL MAKE A REFUND TO THE DEBTOR AS IF THE
 DEBT SETTLEMENT SERVICES AGREEMENT HAD BEEN  CANCELLED  AS  PROVIDED  IN
 SUBDIVISION TWO OF SECTION FIVE HUNDRED EIGHTY-EIGHT-O OF THIS ARTICLE.
   6.  IN  ADDITION  TO  SUCH PENALTIES AS MAY OTHERWISE BE APPLICABLE BY
 LAW, THE SUPERINTENDENT MAY, AFTER NOTICE AND HEARING AS PROVIDED  ELSE-
 WHERE IN THIS ARTICLE, REQUIRE ANY PERSON FOUND VIOLATING THE PROVISIONS
 OF THIS ARTICLE OR THE RULES OR REGULATIONS PROMULGATED HEREUNDER TO PAY
 TO  THE PEOPLE OF THIS STATE AN ADDITIONAL PENALTY FOR EACH VIOLATION OF
 THE ARTICLE OR ANY REGULATION OR POLICY PROMULGATED HEREUNDER A SUM  NOT
 TO EXCEED AN AMOUNT AS DETERMINED PURSUANT TO SECTION FORTY-FOUR OF THIS
 CHAPTER FOR EACH SUCH VIOLATION.
   7.  NOTHING  IN THIS ARTICLE SHALL CREATE A PRIVATE RIGHT OF ACTION ON
 BEHALF OF A DEBTOR AGAINST A DEBT SETTLEMENT COMPANY FOR  VIOLATIONS  OF
 THIS ARTICLE.
   8.  NOTHING  IN  THIS  ARTICLE SHALL LIMIT ANY STATUTORY OR COMMON-LAW
 RIGHT OF ANY PERSON TO BRING ANY ACTION IN ANY COURT FOR ANY ACT, OR THE
 RIGHT OF THE STATE TO PUNISH ANY PERSON FOR ANY VIOLATION OF ANY LAW.
   § 588-U. AUTHORITY OF SUPERINTENDENT.  THE  SUPERINTENDENT  IS  HEREBY
 AUTHORIZED  AND EMPOWERED TO MAKE, IN ADDITION HERETO AND NOT INCONSIST-
 ENT HEREWITH, SUCH GENERAL RULES  AND  REGULATIONS,  AND  SUCH  SPECIFIC
 RULINGS,  DEMANDS,  AND FINDINGS AS HE OR SHE MAY DEEM NECESSARY FOR THE
 PROPER CONDUCT OF THE BUSINESS AUTHORIZED AND LICENSED HEREUNDER AND FOR
 THE ENFORCEMENT OF THIS ARTICLE.
   § 588-V. SEVERABILITY. IF ANY WORD, PHRASE,  CLAUSE,  SENTENCE,  PARA-
 GRAPH,  SUBDIVISION,  SECTION, OR PART OF THIS ARTICLE SHALL BE ADJUDGED
 BY ANY COURT OF COMPETENT JURISDICTION  TO  BE  INVALID,  SUCH  JUDGMENT
 SHALL  NOT AFFECT, IMPAIR, OR INVALIDATE THE REMAINDER THEREOF WHICH CAN
 BE GIVEN EFFECT WITHOUT THE INVALID PROVISION, BUT SHALL BE CONFINED  IN
 ITS OPERATION TO THE WORD, PHRASE, CLAUSE, SENTENCE, PARAGRAPH, SUBDIVI-
 SION,  SECTION, OR PART OF THIS ARTICLE DIRECTLY INVOLVED IN THE CONTRO-
 VERSY IN WHICH THE JUDGMENT SHALL HAVE BEEN RENDERED.
   § 11. This act shall take effect on  the  one  hundred  eightieth  day
 after  it shall have become a law and shall apply to all debt settlement

 A. 3525                            22

 services agreements entered into or  offered  on  or  after  such  date;
 provided,  however,  that  effective  immediately, the superintendent of
 financial services shall add, amend, and/or repeal  any  rule  or  regu-
 lation he or she deems necessary or desirable for implementation of this
 act.