FL
Florida House Bill H0123

Florida 2022 Regular Session

Florida House Bill H0123 Compare Versions

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1010 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
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1414 A bill to be entitled 1
1515 An act relating to consumer finance loans; amending s. 2
1616 516.03, F.S.; authorizing an applicant for a license 3
1717 to make and collect loans under the Florida Consumer 4
1818 Finance Act to provide a surety bond, certificate of 5
1919 deposit, or letter of credit in lieu of liquid assets; 6
2020 amending s. 516.031, F.S.; prohibiting a person 7
2121 licensed to make and collect consumer finance loans 8
2222 from charging prepayment penalties for loans; am ending 9
2323 s. 516.05, F.S.; authorizing an applicant for a 10
2424 license to make and collect consumer finance loans or 11
2525 a licensee to provide a surety bond, certificate of 12
2626 deposit, or letter of credit in lieu of liquid assets; 13
2727 providing requirements for such bonds, c ertificates of 14
2828 deposit, and letters of credit; providing rulemaking 15
2929 authority; amending s. 516.07, F.S.; revising grounds 16
3030 for denial of license or disciplinary action; amending 17
3131 s. 559.952, F.S.; revising exceptions for a licensee 18
3232 during the Financial Techn ology Sandbox period; 19
3333 providing an effective date. 20
3434 21
3535 Be It Enacted by the Legislature of the State of Florida: 22
3636 23
3737 Section 1. Subsection (1) of section 516.03, Florida 24
3838 Statutes, is amended to read: 25
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4747 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
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5151 516.03 Application for license; fees; assets, bonds, 26
5252 certificates of deposit, or letters of credit; etc.— 27
5353 (1) APPLICATION.—Application for a license to make loans 28
5454 under this chapter shall be in the form prescribed by rule of 29
5555 the commission. The commission may require each applicant to 30
5656 provide any informat ion reasonably necessary to determine the 31
5757 applicant's eligibility for licensure. The applicant shall also 32
5858 provide information that the office requires concerning any 33
5959 officer, director, control person, member, partner, or joint 34
6060 venturer of the applicant or any person having the same or 35
6161 substantially similar status or performing substantially similar 36
6262 functions or concerning any individual who is the ultimate 37
6363 equitable owner of a 10 -percent or greater interest in the 38
6464 applicant. The office may require informati on concerning any 39
6565 such applicant or person, including, but not limited to, his or 40
6666 her full name and any other names by which he or she may have 41
6767 been known, age, social security number, residential history, 42
6868 qualifications, educational and business history, and 43
6969 disciplinary and criminal history. The applicant must provide 44
7070 evidence of liquid assets of at least $25,000 or documents 45
7171 satisfying the requirements in s. 516.05(10) . At the time of 46
7272 making such application the applicant shall pay to the office a 47
7373 nonrefundable biennial license fee of $625. Applications, except 48
7474 for applications to renew or reactivate a license, must also be 49
7575 accompanied by a nonrefundable investigation fee of $200. An 50
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8484 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
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8888 application is considered received for purposes of s. 120.60 51
8989 upon receipt of a completed application form as prescribed by 52
9090 commission rule, a nonrefundable application fee of $625, and 53
9191 any other fee prescribed by law. The commission may adopt rules 54
9292 requiring electronic submission of any form, document, or fee 55
9393 required by this act if such rules reasonably accommodate 56
9494 technological or financial hardship. The commission may 57
9595 prescribe by rule requirements and procedures for obtaining an 58
9696 exemption due to a technological or financial hardship. 59
9797 Section 2. Subsection (6) is added t o section 516.031, 60
9898 Florida Statutes, to read: 61
9999 516.031 Finance charge; maximum rates. — 62
100100 (6) PREPAYMENT PENALTIES PROHIBITED. —A licensee may not 63
101101 require a borrower to pay a prepayment penalty for paying all or 64
102102 part of the loan principal before the date on which the payment 65
103103 is due. 66
104104 Section 3. Subsection (10) is added to section 516.05, 67
105105 Florida Statutes, to read: 68
106106 516.05 License.— 69
107107 (10)(a) In lieu of the $25,000 liquid asset requirement in 70
108108 s. 516.03(1): 71
109109 1. An applicant or a licensee may provide to th e office a 72
110110 surety bond in the amount of at least $25,000, issued by a 73
111111 bonding company or insurance company authorized to do business 74
112112 in this state. 75
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121121 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
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125125 2. A company with at least one currently licensed location 76
126-must provide to the office a rider or surety bo nd, in the amount 77
127-of at least $5,000 for each additional license, issued by a 78
126+must provide to the office a rider or surety bo nd in the amount 77
127+of at least $5,000 for each additional license issued by a 78
128128 bonding company or insurance company authorized to do business 79
129129 in this state. However, in no event may the aggregate amount of 80
130130 the surety bond required for a company with multiple licenses 81
131131 exceed $100,000. 82
132132 (b) In lieu of a surety bond, the applicant or the 83
133133 licensee may provide evidence of a certificate of deposit or an 84
134134 irrevocable letter of credit in the same amount of the surety 85
135135 bond required under paragraph (a). The certificate of deposit 86
136136 must be deposited in a financial institution, as defined in s. 87
137-655.005(1)(i). The letter of credit must be issued by a 88
138-financial institution, as defined in s. 655.005(1)(i). 89
139- (c) The original surety bond, certificate of deposit, or 90
140-letter of credit must be filed with the office, and the office 91
141-must be named as beneficiary. The surety bond, certificate of 92
142-deposit, or letter of credit must be for the use and benefit of 93
143-any borrower who is injured by acts of a licensee involving 94
144-fraud, misrepresentation, or deceit, including willful 95
145-imposition of illegal or excessive charges; or 96
146-misrepresentation, circumvention, or concealment of any matter 97
147-required to be stated or furnished to a borrower, where such 98
148-acts are in connection with a loan made under this chapter. The 99
149-office, or any claimant, may bring an action in a court of 100
137+655.005(1)(i). 88
138+ (c) The original surety bond, certificate of deposit, or 89
139+letter of credit must be filed with the office, and the office 90
140+must be named as beneficiary. The surety bond, certificate of 91
141+deposit, or letter of credit must be for the use and benefit of 92
142+any borrower who is injured by acts of a licensee involving 93
143+fraud, misrepresentation, or deceit, including willful 94
144+imposition of illegal or excessive charges; or 95
145+misrepresentation, circumvention, or concealment of any matter 96
146+required to be stated or furnished to a borrower, where such 97
147+acts are in connection with a loan made under this chapter. The 98
148+office, or any claimant, may bring an action in a court of 99
149+competent jurisdiction on the surety bond, certificate of 100
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158158 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
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162-competent jurisdiction on the surety bond, certificate of 101
163-deposit, or letter of credit. The surety bond, certifi cate of 102
164-deposit, or letter of credit must be payable on a pro rata 103
165-basis, but the aggregate amount may not exceed the amount of the 104
166-surety bond, certificate of deposit, or letter of credit. 105
167- (d) The surety bond, certificate of deposit, or letter of 106
168-credit may not be canceled by the licensee, bonding or insurance 107
169-company, or financial institution except upon notice to the 108
170-office by certified mail. A cancellation may not take effect 109
171-until 30 calendar days after receipt by the office of the 110
172-notice. 111
173- (e) The bonding or insurance company or financial 112
174-institution must, within 10 calendar days after it pays a claim, 113
175-give notice to the office by certified mail of such payment with 114
176-details sufficient to identify the claimant and the claim or 115
177-judgment paid. 116
178- (f) If the principal sum of the surety bond, certificate 117
179-of deposit, or letter of credit is reduced by one or more 118
180-recoveries or payments, the licensee must furnish to the office 119
181-a new or additional surety bond, certificate of deposit, or 120
182-letter of credit so tha t the total or aggregate principal sum 121
183-equals the amount required under this subsection. Alternatively, 122
184-a licensee may furnish an endorsement executed by the bonding or 123
185-insurance company or financial institution reinstating the 124
186-required principal amount. 125
162+deposit, or letter of credit. The surety bond, certifi cate of 101
163+deposit, or letter of credit must be payable on a pro rata 102
164+basis, but the aggregate amount may not exceed the amount of the 103
165+surety bond, certificate of deposit, or letter of credit. 104
166+ (d) The surety bond, certificate of deposit, or letter of 105
167+credit may not be canceled by the licensee, bonding or insurance 106
168+company, or financial institution except upon notice to the 107
169+office by certified mail. A cancellation may not take effect 108
170+until 30 calendar days after receipt by the office of the 109
171+notice. 110
172+ (e) The bonding or insurance company or financial 111
173+institution must, within 10 calendar days after it pays a claim, 112
174+give notice to the office by certified mail of such payment with 113
175+details sufficient to identify the claimant and the claim or 114
176+judgment paid. 115
177+ (f) If the principal sum of the surety bond, certificate 116
178+of deposit, or letter of credit is reduced by one or more 117
179+recoveries or payments, the licensee must furnish to the office 118
180+a new or additional surety bond, certificate of deposit, or 119
181+letter of credit so tha t the total or aggregate principal sum 120
182+equals the amount required under this subsection. Alternatively, 121
183+a licensee may furnish an endorsement executed by the bonding or 122
184+insurance company or financial institution reinstating the 123
185+required principal amount. 124
186+ (g) The required surety bond, certificate of deposit, or 125
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195195 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
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199- (g) The required surety bond, certificate of deposit, or 126
200-letter of credit must remain in place for 2 years after the 127
201-licensee ceases licensed operations in this state. During the 2 -128
202-year period, the office may allow for a reduction or elimination 129
203-of the surety bond, certificate of deposit, or letter of credit 130
204-to the extent the licensee's outstanding consumer finance loans 131
205-in the state are reduced. 132
206- (h) The commission may prescribe by rule forms and 133
207-procedures to implement this subsection. 134
208- Section 4. Paragraph (b) of subsection (1) of section 135
209-516.07, Florida Statutes, is amended to read: 136
210- 516.07 Grounds for denial of license or for disciplinary 137
211-action.— 138
212- (1) The following acts are violations of this chapter and 139
213-constitute grounds for denial of an appli cation for a license to 140
214-make consumer finance loans and grounds for any of the 141
215-disciplinary actions specified in subsection (2): 142
216- (b) Failure to maintain liquid assets of at least $25,000 143
217-or a surety bond, certificate of deposit, or letter of credit in 144
218-the amount required by s. 516.05(10) at all times for the 145
219-operation of business at a licensed location or proposed 146
220-location. 147
221- Section 5. Paragraph (a) of subsection (4) of section 148
222-559.952, Florida Statutes, is amended to read: 149
223- 559.952 Financial Technolo gy Sandbox.— 150
199+letter of credit must remain in place for 2 years after the 126
200+licensee ceases licensed operations in this state. During the 2 -127
201+year period, the office may allow for a reduction or elimination 128
202+of the surety bond, certificate of deposit, or letter of credit 129
203+to the extent the licensee's outstanding consumer finance loans 130
204+in the state are reduced. 131
205+ (h) The commission may prescribe by rule forms and 132
206+procedures to implement this subsection. 133
207+ Section 4. Paragraph (b) of subsection (1) of section 134
208+516.07, Florida Statutes, is amended to read: 135
209+ 516.07 Grounds for denial of license or for disciplinary 136
210+action.— 137
211+ (1) The following acts are violations of this chapter and 138
212+constitute grounds for denial of an appli cation for a license to 139
213+make consumer finance loans and grounds for any of the 140
214+disciplinary actions specified in subsection (2): 141
215+ (b) Failure to maintain liquid assets of at least $25,000 142
216+or a surety bond, certificate of deposit, or letter of credit in 143
217+the amount required by s. 516.05(10) at all times for the 144
218+operation of business at a licensed location or proposed 145
219+location. 146
220+ Section 5. Paragraph (a) of subsection (4) of section 147
221+559.952, Florida Statutes, is amended to read: 148
222+ 559.952 Financial Technolo gy Sandbox.— 149
223+ (4) EXCEPTIONS TO GENERAL LAW AND WAIVERS OF RULE 150
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232232 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
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236- (4) EXCEPTIONS TO GENERAL LAW AND WAIVERS OF RULE 151
237-REQUIREMENTS.— 152
238- (a) Notwithstanding any other law, upon approval of a 153
239-Financial Technology Sandbox application, the following 154
240-provisions and corresponding rule requirements are not 155
241-applicable to the licensee during the sandbox period: 156
242- 1. Section 516.03(1), except for the application fee, the 157
243-investigation fee, the requirement to provide the social 158
244-security numbers of control persons, evidence of liquid assets 159
245-of at least $25,000 or documents satisfying the requirements in 160
246-s. 516.05(10), and the office's authority to investigate the 161
247-applicant's background. The office may prorate the license 162
248-renewal fee for an extension granted under subsection (7). 163
249- 2. Section 516.05(1) and (2), except that the office shall 164
250-investigate the applicant's background. 165
251- 3. Section 560.109, only to the extent that the section 166
252-requires the office to examine a licensee at least once every 5 167
253-years. 168
254- 4. Section 560.118(2). 169
255- 5. Section 560.125(1), only to the extent t hat the 170
256-subsection would prohibit a licensee from engaging in the 171
257-business of a money transmitter or payment instrument seller 172
258-during the sandbox period. 173
259- 6. Section 560.125(2), only to the extent that the 174
260-subsection would prohibit a licensee from appoint ing an 175
236+REQUIREMENTS.— 151
237+ (a) Notwithstanding any other law, upon approval of a 152
238+Financial Technology Sandbox application, the following 153
239+provisions and corresponding rule requirements are not 154
240+applicable to the licensee during the sandbox period: 155
241+ 1. Section 516.03(1), except for the application fee, the 156
242+investigation fee, the requirement to provide the social 157
243+security numbers of control persons, evidence of liquid assets 158
244+of at least $25,000 or documents satisfying the requirements in 159
245+s. 516.05(10), and the office's authority to investigate the 160
246+applicant's background. The office may prorate the license 161
247+renewal fee for an extension granted under subsection (7). 162
248+ 2. Section 516.05(1) and (2), except that the office shall 163
249+investigate the applicant's background. 164
250+ 3. Section 560.109, only to the extent that the section 165
251+requires the office to examine a licensee at least once every 5 166
252+years. 167
253+ 4. Section 560.118(2). 168
254+ 5. Section 560.125(1), only to the extent t hat the 169
255+subsection would prohibit a licensee from engaging in the 170
256+business of a money transmitter or payment instrument seller 171
257+during the sandbox period. 172
258+ 6. Section 560.125(2), only to the extent that the 173
259+subsection would prohibit a licensee from appoint ing an 174
260+authorized vendor during the sandbox period. Any authorized 175
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269269 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
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273-authorized vendor during the sandbox period. Any authorized 176
274-vendor of such a licensee during the sandbox period remains 177
275-liable to the holder or remitter. 178
276- 7. Section 560.128. 179
277- 8. Section 560.141, except for s. 560.141(1)(a)1., 3., 7. -180
278-10. and (b), (c), and (d). 181
279- 9. Section 560.142(1) and (2), except that the office may 182
280-prorate, but may not entirely eliminate, the license renewal 183
281-fees in s. 560.143 for an extension granted under subsection 184
282-(7). 185
283- 10. Section 560.143(2), only to the extent necessary for 186
284-proration of the renewal fee under subparagraph 9. 187
285- 11. Section 560.204(1), only to the extent that the 188
286-subsection would prohibit a licensee from engaging in, or 189
287-advertising that it engages in, the selling or issuing of 190
288-payment instruments or in the a ctivity of a money transmitter 191
289-during the sandbox period. 192
290- 12. Section 560.205(2). 193
291- 13. Section 560.208(2). 194
292- 14. Section 560.209, only to the extent that the office 195
293-may modify, but may not entirely eliminate, the net worth, 196
294-corporate surety bond, and co llateral deposit amounts required 197
295-under that section. The modified amounts must be in such lower 198
296-amounts that the office determines to be commensurate with the 199
297-factors under paragraph (5)(c) and the maximum number of 200
273+vendor of such a licensee during the sandbox period remains 176
274+liable to the holder or remitter. 177
275+ 7. Section 560.128. 178
276+ 8. Section 560.141, except for s. 560.141(1)(a)1., 3., 7. -179
277+10. and (b), (c), and (d). 180
278+ 9. Section 560.142(1) and (2), except that the office may 181
279+prorate, but may not entirely eliminate, the license renewal 182
280+fees in s. 560.143 for an extension granted under subsection 183
281+(7). 184
282+ 10. Section 560.143(2), only to the extent necessary for 185
283+proration of the renewal fee under subparagraph 9. 186
284+ 11. Section 560.204(1), only to the extent that the 187
285+subsection would prohibit a licensee from engaging in, or 188
286+advertising that it engages in, the selling or issuing of 189
287+payment instruments or in the a ctivity of a money transmitter 190
288+during the sandbox period. 191
289+ 12. Section 560.205(2). 192
290+ 13. Section 560.208(2). 193
291+ 14. Section 560.209, only to the extent that the office 194
292+may modify, but may not entirely eliminate, the net worth, 195
293+corporate surety bond, and co llateral deposit amounts required 196
294+under that section. The modified amounts must be in such lower 197
295+amounts that the office determines to be commensurate with the 198
296+factors under paragraph (5)(c) and the maximum number of 199
297+consumers authorized to receive the fin ancial product or service 200
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306306 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
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310-consumers authorized to receive the fin ancial product or service 201
311-under this section. 202
312- Section 6. This act shall take effect October 1, 2022. 203
310+under this section. 201
311+ Section 6. This act shall take effect October 1, 2022. 202