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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to consumer finance loans; amending s. 2
516.03, F.S.; authorizing an applicant for a license 3
to make and collect loans under the Florida Consumer 4
Finance Act to provide a surety bond, certificate of 5
deposit, or letter of credit in lieu of liquid assets; 6
amending s. 516.031, F.S.; prohibiting a person 7
licensed to make and collect consumer finance loans 8
from charging prepayment penalties for loans; am ending 9
s. 516.05, F.S.; authorizing an applicant for a 10
license to make and collect consumer finance loans or 11
a licensee to provide a surety bond, certificate of 12
deposit, or letter of credit in lieu of liquid assets; 13
providing requirements for such bonds, c ertificates of 14
deposit, and letters of credit; providing rulemaking 15
authority; amending s. 516.07, F.S.; revising grounds 16
for denial of license or disciplinary action; amending 17
s. 559.952, F.S.; revising exceptions for a licensee 18
during the Financial Techn ology Sandbox period; 19
providing an effective date. 20
21
Be It Enacted by the Legislature of the State of Florida: 22
23
Section 1. Subsection (1) of section 516.03, Florida 24
Statutes, is amended to read: 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
516.03 Application for license; fees; assets, bonds, 26
certificates of deposit, or letters of credit; etc.— 27
(1) APPLICATION.—Application for a license to make loans 28
under this chapter shall be in the form prescribed by rule of 29
the commission. The commission may require each applicant to 30
provide any informat ion reasonably necessary to determine the 31
applicant's eligibility for licensure. The applicant shall also 32
provide information that the office requires concerning any 33
officer, director, control person, member, partner, or joint 34
venturer of the applicant or any person having the same or 35
substantially similar status or performing substantially similar 36
functions or concerning any individual who is the ultimate 37
equitable owner of a 10 -percent or greater interest in the 38
applicant. The office may require informati on concerning any 39
such applicant or person, including, but not limited to, his or 40
her full name and any other names by which he or she may have 41
been known, age, social security number, residential history, 42
qualifications, educational and business history, and 43
disciplinary and criminal history. The applicant must provide 44
evidence of liquid assets of at least $25,000 or documents 45
satisfying the requirements in s. 516.05(10) . At the time of 46
making such application the applicant shall pay to the office a 47
nonrefundable biennial license fee of $625. Applications, except 48
for applications to renew or reactivate a license, must also be 49
accompanied by a nonrefundable investigation fee of $200. An 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
application is considered received for purposes of s. 120.60 51
upon receipt of a completed application form as prescribed by 52
commission rule, a nonrefundable application fee of $625, and 53
any other fee prescribed by law. The commission may adopt rules 54
requiring electronic submission of any form, document, or fee 55
required by this act if such rules reasonably accommodate 56
technological or financial hardship. The commission may 57
prescribe by rule requirements and procedures for obtaining an 58
exemption due to a technological or financial hardship. 59
Section 2. Subsection (6) is added t o section 516.031, 60
Florida Statutes, to read: 61
516.031 Finance charge; maximum rates. — 62
(6) PREPAYMENT PENALTIES PROHIBITED. —A licensee may not 63
require a borrower to pay a prepayment penalty for paying all or 64
part of the loan principal before the date on which the payment 65
is due. 66
Section 3. Subsection (10) is added to section 516.05, 67
Florida Statutes, to read: 68
516.05 License.— 69
(10)(a) In lieu of the $25,000 liquid asset requirement in 70
s. 516.03(1): 71
1. An applicant or a licensee may provide to th e office a 72
surety bond in the amount of at least $25,000, issued by a 73
bonding company or insurance company authorized to do business 74
in this state. 75
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2. A company with at least one currently licensed location 76
must provide to the office a rider or surety bo nd in the amount 77
of at least $5,000 for each additional license issued by a 78
bonding company or insurance company authorized to do business 79
in this state. However, in no event may the aggregate amount of 80
the surety bond required for a company with multiple licenses 81
exceed $100,000. 82
(b) In lieu of a surety bond, the applicant or the 83
licensee may provide evidence of a certificate of deposit or an 84
irrevocable letter of credit in the same amount of the surety 85
bond required under paragraph (a). The certificate of deposit 86
must be deposited in a financial institution, as defined in s. 87
655.005(1)(i). 88
(c) The original surety bond, certificate of deposit, or 89
letter of credit must be filed with the office, and the office 90
must be named as beneficiary. The surety bond, certificate of 91
deposit, or letter of credit must be for the use and benefit of 92
any borrower who is injured by acts of a licensee involving 93
fraud, misrepresentation, or deceit, including willful 94
imposition of illegal or excessive charges; or 95
misrepresentation, circumvention, or concealment of any matter 96
required to be stated or furnished to a borrower, where such 97
acts are in connection with a loan made under this chapter. The 98
office, or any claimant, may bring an action in a court of 99
competent jurisdiction on the surety bond, certificate of 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
deposit, or letter of credit. The surety bond, certifi cate of 101
deposit, or letter of credit must be payable on a pro rata 102
basis, but the aggregate amount may not exceed the amount of the 103
surety bond, certificate of deposit, or letter of credit. 104
(d) The surety bond, certificate of deposit, or letter of 105
credit may not be canceled by the licensee, bonding or insurance 106
company, or financial institution except upon notice to the 107
office by certified mail. A cancellation may not take effect 108
until 30 calendar days after receipt by the office of the 109
notice. 110
(e) The bonding or insurance company or financial 111
institution must, within 10 calendar days after it pays a claim, 112
give notice to the office by certified mail of such payment with 113
details sufficient to identify the claimant and the claim or 114
judgment paid. 115
(f) If the principal sum of the surety bond, certificate 116
of deposit, or letter of credit is reduced by one or more 117
recoveries or payments, the licensee must furnish to the office 118
a new or additional surety bond, certificate of deposit, or 119
letter of credit so tha t the total or aggregate principal sum 120
equals the amount required under this subsection. Alternatively, 121
a licensee may furnish an endorsement executed by the bonding or 122
insurance company or financial institution reinstating the 123
required principal amount. 124
(g) The required surety bond, certificate of deposit, or 125
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letter of credit must remain in place for 2 years after the 126
licensee ceases licensed operations in this state. During the 2 -127
year period, the office may allow for a reduction or elimination 128
of the surety bond, certificate of deposit, or letter of credit 129
to the extent the licensee's outstanding consumer finance loans 130
in the state are reduced. 131
(h) The commission may prescribe by rule forms and 132
procedures to implement this subsection. 133
Section 4. Paragraph (b) of subsection (1) of section 134
516.07, Florida Statutes, is amended to read: 135
516.07 Grounds for denial of license or for disciplinary 136
action.— 137
(1) The following acts are violations of this chapter and 138
constitute grounds for denial of an appli cation for a license to 139
make consumer finance loans and grounds for any of the 140
disciplinary actions specified in subsection (2): 141
(b) Failure to maintain liquid assets of at least $25,000 142
or a surety bond, certificate of deposit, or letter of credit in 143
the amount required by s. 516.05(10) at all times for the 144
operation of business at a licensed location or proposed 145
location. 146
Section 5. Paragraph (a) of subsection (4) of section 147
559.952, Florida Statutes, is amended to read: 148
559.952 Financial Technolo gy Sandbox.— 149
(4) EXCEPTIONS TO GENERAL LAW AND WAIVERS OF RULE 150
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REQUIREMENTS.— 151
(a) Notwithstanding any other law, upon approval of a 152
Financial Technology Sandbox application, the following 153
provisions and corresponding rule requirements are not 154
applicable to the licensee during the sandbox period: 155
1. Section 516.03(1), except for the application fee, the 156
investigation fee, the requirement to provide the social 157
security numbers of control persons, evidence of liquid assets 158
of at least $25,000 or documents satisfying the requirements in 159
s. 516.05(10), and the office's authority to investigate the 160
applicant's background. The office may prorate the license 161
renewal fee for an extension granted under subsection (7). 162
2. Section 516.05(1) and (2), except that the office shall 163
investigate the applicant's background. 164
3. Section 560.109, only to the extent that the section 165
requires the office to examine a licensee at least once every 5 166
years. 167
4. Section 560.118(2). 168
5. Section 560.125(1), only to the extent t hat the 169
subsection would prohibit a licensee from engaging in the 170
business of a money transmitter or payment instrument seller 171
during the sandbox period. 172
6. Section 560.125(2), only to the extent that the 173
subsection would prohibit a licensee from appoint ing an 174
authorized vendor during the sandbox period. Any authorized 175
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vendor of such a licensee during the sandbox period remains 176
liable to the holder or remitter. 177
7. Section 560.128. 178
8. Section 560.141, except for s. 560.141(1)(a)1., 3., 7. -179
10. and (b), (c), and (d). 180
9. Section 560.142(1) and (2), except that the office may 181
prorate, but may not entirely eliminate, the license renewal 182
fees in s. 560.143 for an extension granted under subsection 183
(7). 184
10. Section 560.143(2), only to the extent necessary for 185
proration of the renewal fee under subparagraph 9. 186
11. Section 560.204(1), only to the extent that the 187
subsection would prohibit a licensee from engaging in, or 188
advertising that it engages in, the selling or issuing of 189
payment instruments or in the a ctivity of a money transmitter 190
during the sandbox period. 191
12. Section 560.205(2). 192
13. Section 560.208(2). 193
14. Section 560.209, only to the extent that the office 194
may modify, but may not entirely eliminate, the net worth, 195
corporate surety bond, and co llateral deposit amounts required 196
under that section. The modified amounts must be in such lower 197
amounts that the office determines to be commensurate with the 198
factors under paragraph (5)(c) and the maximum number of 199
consumers authorized to receive the fin ancial product or service 200
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
under this section. 201
Section 6. This act shall take effect October 1, 2022. 202