Indiana 2023 Regular Session

Indiana House Bill HB1494 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	Introduced Version
3	3	HOUSE BILL No. 1494
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 24-5.
7	7	Synopsis: Prohibition on charging residual interest. Defines "residual
8	8	interest", with respect to a credit card, as interest that: (1) accrues on
9	9	the outstanding balance on a credit card account from the close of a
10	10	particular billing cycle until the cardholder's payment on the account
11	11	posts; and (2) may result in a cardholder owing interest even if the
12	12	cardholder pays off the full amount shown as outstanding on the
13	13	statement issued as of the close of the billing cycle. Prohibits a card
14	14	issuer from doing the following: (1) Issuing, or offering to issue, a
15	15	credit card to an Indiana consumer if, under the terms and conditions
16	16	of use for the credit card, the card issuer is permitted to charge residual
17	17	interest on outstanding balances. (2) Charging residual interest on the
18	18	outstanding balance on a credit card account. Provides that a card
19	19	issuer that violates these provisions commits a deceptive act that is: (1)
20	20	actionable by the attorney general or by a consumer under the
21	21	deceptive consumer sales act (act); and (2) subject to the remedies and
22	22	penalties set forth in the act.
23	23	Effective: Upon passage.
24	24	Carbaugh
25	25	January 17, 2023, read first time and referred to Committee on Financial Institutions.
26	26	2023 IN 1494—LS 7398/DI 101 Introduced
27	27	First Regular Session of the 123rd General Assembly (2023)
28	28	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
29	29	Constitution) is being amended, the text of the existing provision will appear in this style type,
30	30	additions will appear in this style type, and deletions will appear in this style type.
31	31	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
32	32	provision adopted), the text of the new provision will appear in this style type. Also, the
33	33	word NEW will appear in that style type in the introductory clause of each SECTION that adds
34	34	a new provision to the Indiana Code or the Indiana Constitution.
35	35	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
36	36	between statutes enacted by the 2022 Regular Session of the General Assembly.
37	37	HOUSE BILL No. 1494
38	38	A BILL FOR AN ACT to amend the Indiana Code concerning trade
39	39	regulation.
40	40	Be it enacted by the General Assembly of the State of Indiana:
41	41	1 SECTION 1. IC 24-5-0.5-3, AS AMENDED BY P.L.34-2022,
42	42	2 SECTION 7, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
43	43	3 UPON PASSAGE]: Sec. 3. (a) A supplier may not commit an unfair,
44	44	4 abusive, or deceptive act, omission, or practice in connection with a
45	45	5 consumer transaction. Such an act, omission, or practice by a supplier
46	46	6 is a violation of this chapter whether it occurs before, during, or after
47	47	7 the transaction. An act, omission, or practice prohibited by this section
48	48	8 includes both implicit and explicit misrepresentations.
49	49	9 (b) Without limiting the scope of subsection (a), the following acts,
50	50	10 and the following representations as to the subject matter of a
51	51	11 consumer transaction, made orally, in writing, or by electronic
52	52	12 communication, by a supplier, are deceptive acts:
53	53	13 (1) That such subject of a consumer transaction has sponsorship,
54	54	14 approval, performance, characteristics, accessories, uses, or
55	55	15 benefits it does not have which the supplier knows or should
56	56	16 reasonably know it does not have.
57	57	17 (2) That such subject of a consumer transaction is of a particular
58	58	2023 IN 1494—LS 7398/DI 101 2
59	59	1 standard, quality, grade, style, or model, if it is not and if the
60	60	2 supplier knows or should reasonably know that it is not.
61	61	3 (3) That such subject of a consumer transaction is new or unused,
62	62	4 if it is not and if the supplier knows or should reasonably know
63	63	5 that it is not.
64	64	6 (4) That such subject of a consumer transaction will be supplied
65	65	7 to the public in greater quantity than the supplier intends or
66	66	8 reasonably expects.
67	67	9 (5) That replacement or repair constituting the subject of a
68	68	10 consumer transaction is needed, if it is not and if the supplier
69	69	11 knows or should reasonably know that it is not.
70	70	12 (6) That a specific price advantage exists as to such subject of a
71	71	13 consumer transaction, if it does not and if the supplier knows or
72	72	14 should reasonably know that it does not.
73	73	15 (7) That the supplier has a sponsorship, approval, or affiliation in
74	74	16 such consumer transaction the supplier does not have, and which
75	75	17 the supplier knows or should reasonably know that the supplier
76	76	18 does not have.
77	77	19 (8) That such consumer transaction involves or does not involve
78	78	20 a warranty, a disclaimer of warranties, or other rights, remedies,
79	79	21 or obligations, if the representation is false and if the supplier
80	80	22 knows or should reasonably know that the representation is false.
81	81	23 (9) That the consumer will receive a rebate, discount, or other
82	82	24 benefit as an inducement for entering into a sale or lease in return
83	83	25 for giving the supplier the names of prospective consumers or
84	84	26 otherwise helping the supplier to enter into other consumer
85	85	27 transactions, if earning the benefit, rebate, or discount is
86	86	28 contingent upon the occurrence of an event subsequent to the time
87	87	29 the consumer agrees to the purchase or lease.
88	88	30 (10) That the supplier is able to deliver or complete the subject of
89	89	31 the consumer transaction within a stated period of time, when the
90	90	32 supplier knows or should reasonably know the supplier could not.
91	91	33 If no time period has been stated by the supplier, there is a
92	92	34 presumption that the supplier has represented that the supplier
93	93	35 will deliver or complete the subject of the consumer transaction
94	94	36 within a reasonable time, according to the course of dealing or the
95	95	37 usage of the trade.
96	96	38 (11) That the consumer will be able to purchase the subject of the
97	97	39 consumer transaction as advertised by the supplier, if the supplier
98	98	40 does not intend to sell it.
99	99	41 (12) That the replacement or repair constituting the subject of a
100	100	42 consumer transaction can be made by the supplier for the estimate
101	101	2023 IN 1494—LS 7398/DI 101 3
102	102	1 the supplier gives a customer for the replacement or repair, if the
103	103	2 specified work is completed and:
104	104	3 (A) the cost exceeds the estimate by an amount equal to or
105	105	4 greater than ten percent (10%) of the estimate;
106	106	5 (B) the supplier did not obtain written permission from the
107	107	6 customer to authorize the supplier to complete the work even
108	108	7 if the cost would exceed the amounts specified in clause (A);
109	109	8 (C) the total cost for services and parts for a single transaction
110	110	9 is more than seven hundred fifty dollars ($750); and
111	111	10 (D) the supplier knew or reasonably should have known that
112	112	11 the cost would exceed the estimate in the amounts specified in
113	113	12 clause (A).
114	114	13 (13) That the replacement or repair constituting the subject of a
115	115	14 consumer transaction is needed, and that the supplier disposes of
116	116	15 the part repaired or replaced earlier than seventy-two (72) hours
117	117	16 after both:
118	118	17 (A) the customer has been notified that the work has been
119	119	18 completed; and
120	120	19 (B) the part repaired or replaced has been made available for
121	121	20 examination upon the request of the customer.
122	122	21 (14) Engaging in the replacement or repair of the subject of a
123	123	22 consumer transaction if the consumer has not authorized the
124	124	23 replacement or repair, and if the supplier knows or should
125	125	24 reasonably know that it is not authorized.
126	126	25 (15) The act of misrepresenting the geographic location of the
127	127	26 supplier by listing an alternate business name or an assumed
128	128	27 business name (as described in IC 23-0.5-3-4) in a local telephone
129	129	28 directory if:
130	130	29 (A) the name misrepresents the supplier's geographic location;
131	131	30 (B) the listing fails to identify the locality and state of the
132	132	31 supplier's business;
133	133	32 (C) calls to the local telephone number are routinely forwarded
134	134	33 or otherwise transferred to a supplier's business location that
135	135	34 is outside the calling area covered by the local telephone
136	136	35 directory; and
137	137	36 (D) the supplier's business location is located in a county that
138	138	37 is not contiguous to a county in the calling area covered by the
139	139	38 local telephone directory.
140	140	39 (16) The act of listing an alternate business name or assumed
141	141	40 business name (as described in IC 23-0.5-3-4) in a directory
142	142	41 assistance data base if:
143	143	42 (A) the name misrepresents the supplier's geographic location;
144	144	2023 IN 1494—LS 7398/DI 101 4
145	145	1 (B) calls to the local telephone number are routinely forwarded
146	146	2 or otherwise transferred to a supplier's business location that
147	147	3 is outside the local calling area; and
148	148	4 (C) the supplier's business location is located in a county that
149	149	5 is not contiguous to a county in the local calling area.
150	150	6 (17) The violation by a supplier of IC 24-3-4 concerning
151	151	7 cigarettes for import or export.
152	152	8 (18) The act of a supplier in knowingly selling or reselling a
153	153	9 product to a consumer if the product has been recalled, whether
154	154	10 by the order of a court or a regulatory body, or voluntarily by the
155	155	11 manufacturer, distributor, or retailer, unless the product has been
156	156	12 repaired or modified to correct the defect that was the subject of
157	157	13 the recall.
158	158	14 (19) The violation by a supplier of 47 U.S.C. 227, including any
159	159	15 rules or regulations issued under 47 U.S.C. 227.
160	160	16 (20) The violation by a supplier of the federal Fair Debt
161	161	17 Collection Practices Act (15 U.S.C. 1692 et seq.), including any
162	162	18 rules or regulations issued under the federal Fair Debt Collection
163	163	19 Practices Act (15 U.S.C. 1692 et seq.).
164	164	20 (21) A violation of IC 24-5-7 (concerning health spa services), as
165	165	21 set forth in IC 24-5-7-17.
166	166	22 (22) A violation of IC 24-5-8 (concerning business opportunity
167	167	23 transactions), as set forth in IC 24-5-8-20.
168	168	24 (23) A violation of IC 24-5-10 (concerning home consumer
169	169	25 transactions), as set forth in IC 24-5-10-18.
170	170	26 (24) A violation of IC 24-5-11 (concerning real property
171	171	27 improvement contracts), as set forth in IC 24-5-11-14.
172	172	28 (25) A violation of IC 24-5-12 (concerning telephone
173	173	29 solicitations), as set forth in IC 24-5-12-23.
174	174	30 (26) A violation of IC 24-5-13.5 (concerning buyback motor
175	175	31 vehicles), as set forth in IC 24-5-13.5-14.
176	176	32 (27) A violation of IC 24-5-14 (concerning automatic
177	177	33 dialing-announcing devices), as set forth in IC 24-5-14-13.
178	178	34 (28) A violation of IC 24-5-15 (concerning credit services
179	179	35 organizations), as set forth in IC 24-5-15-11.
180	180	36 (29) A violation of IC 24-5-16 (concerning unlawful motor
181	181	37 vehicle subleasing), as set forth in IC 24-5-16-18.
182	182	38 (30) A violation of IC 24-5-17 (concerning environmental
183	183	39 marketing claims), as set forth in IC 24-5-17-14.
184	184	40 (31) A violation of IC 24-5-19 (concerning deceptive commercial
185	185	41 solicitation), as set forth in IC 24-5-19-11.
186	186	42 (32) A violation of IC 24-5-21 (concerning prescription drug
187	187	2023 IN 1494—LS 7398/DI 101 5
188	188	1 discount cards), as set forth in IC 24-5-21-7.
189	189	2 (33) A violation of IC 24-5-23.5-7 (concerning real estate
190	190	3 appraisals), as set forth in IC 24-5-23.5-9.
191	191	4 (34) A violation of IC 24-5-26 (concerning identity theft), as set
192	192	5 forth in IC 24-5-26-3.
193	193	6 (35) A violation of IC 24-5.5 (concerning mortgage rescue fraud),
194	194	7 as set forth in IC 24-5.5-6-1.
195	195	8 (36) A violation of IC 24-8 (concerning promotional gifts and
196	196	9 contests), as set forth in IC 24-8-6-3.
197	197	10 (37) A violation of IC 21-18.5-6 (concerning representations
198	198	11 made by a postsecondary credit bearing proprietary educational
199	199	12 institution), as set forth in IC 21-18.5-6-22.5.
200	200	13 (38) A violation of IC 24-5-15.5 (concerning collection actions of
201	201	14 a plaintiff debt buyer), as set forth in IC 24-5-15.5-6.
202	202	15 (39) A violation of IC 24-14 (concerning towing services), as set
203	203	16 forth in IC 24-14-10-1.
204	204	17 (40) A violation of IC 24-5-14.5 (concerning misleading or
205	205	18 inaccurate caller identification information), as set forth in
206	206	19 IC 24-5-14.5-12.
207	207	20 (41) A violation of IC 24-5-27 (concerning intrastate inmate
208	208	21 calling services), as set forth in IC 24-5-27-27.
209	209	22 (42) A violation of 24-5-28-8 (concerning residual interest on
210	210	23 credit card account balances) as set forth in IC 24-5-28-9.
211	211	24 (c) Any representations on or within a product or its packaging or
212	212	25 in advertising or promotional materials which would constitute a
213	213	26 deceptive act shall be the deceptive act both of the supplier who places
214	214	27 such representation thereon or therein, or who authored such materials,
215	215	28 and such other suppliers who shall state orally or in writing that such
216	216	29 representation is true if such other supplier shall know or have reason
217	217	30 to know that such representation was false.
218	218	31 (d) If a supplier shows by a preponderance of the evidence that an
219	219	32 act resulted from a bona fide error notwithstanding the maintenance of
220	220	33 procedures reasonably adopted to avoid the error, such act shall not be
221	221	34 deceptive within the meaning of this chapter.
222	222	35 (e) It shall be a defense to any action brought under this chapter that
223	223	36 the representation constituting an alleged deceptive act was one made
224	224	37 in good faith by the supplier without knowledge of its falsity and in
225	225	38 reliance upon the oral or written representations of the manufacturer,
226	226	39 the person from whom the supplier acquired the product, any testing
227	227	40 organization, or any other person provided that the source thereof is
228	228	41 disclosed to the consumer.
229	229	42 (f) For purposes of subsection (b)(12), a supplier that provides
230	230	2023 IN 1494—LS 7398/DI 101 6
231	231	1 estimates before performing repair or replacement work for a customer
232	232	2 shall give the customer a written estimate itemizing as closely as
233	233	3 possible the price for labor and parts necessary for the specific job
234	234	4 before commencing the work.
235	235	5 (g) For purposes of subsection (b)(15) and (b)(16), a telephone
236	236	6 company or other provider of a telephone directory or directory
237	237	7 assistance service or its officer or agent is immune from liability for
238	238	8 publishing the listing of an alternate business name or assumed
239	239	9 business name of a supplier in its directory or directory assistance data
240	240	10 base unless the telephone company or other provider of a telephone
241	241	11 directory or directory assistance service is the same person as the
242	242	12 supplier who has committed the deceptive act.
243	243	13 (h) For purposes of subsection (b)(18), it is an affirmative defense
244	244	14 to any action brought under this chapter that the product has been
245	245	15 altered by a person other than the defendant to render the product
246	246	16 completely incapable of serving its original purpose.
247	247	17 SECTION 2. IC 24-5-28 IS ADDED TO THE INDIANA CODE AS
248	248	18 A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE UPON
249	249	19 PASSAGE]:
250	250	20 Chapter 28. Credit Cards: Prohibition Against Charging
251	251	21 Residual Interest
252	252	22 Sec. 1. As used in this chapter, "billing cycle", with respect to a
253	253	23 credit card, means the interval between the days or dates of
254	254	24 regular periodic statements.
255	255	25 Sec. 2. (a) As used in this chapter, "card issuer" means a person
256	256	26 that issues a credit card.
257	257	27 (b) The term includes an agent of a person described in
258	258	28 subsection (a) with respect to the credit card issued.
259	259	29 Sec. 3. As used in this chapter, "cardholder" means:
260	260	30 (1) a consumer to whom a credit card is issued for any
261	261	31 purpose; or
262	262	32 (2) a person, other than the consumer, who has agreed with a
263	263	33 card issuer to pay obligations arising from the issuance of a
264	264	34 credit card to a consumer.
265	265	35 Sec. 4. As used in this chapter, "consumer" means:
266	266	36 (1) a natural person whose principal residence is in Indiana;
267	267	37 or
268	268	38 (2) a person, other than a natural person, that is:
269	269	39 (A) domiciled; or
270	270	40 (B) in the case of a governmental unit, located;
271	271	41 in Indiana.
272	272	42 Sec. 5. As used in this chapter, "credit card" means any:
273	273	2023 IN 1494—LS 7398/DI 101 7
274	274	1 (1) card;
275	275	2 (2) plate; or
276	276	3 (3) other single credit device;
277	277	4 that may be used from time to time to obtain credit (as defined in
278	278	5 12 CFR 1026.2(a)(14)).
279	279	6 Sec. 6. As used in this chapter, "person" means:
280	280	7 (1) a natural person; or
281	281	8 (2) an organization, including a corporation, a partnership, a
282	282	9 proprietorship, an association, a cooperative, an estate, a
283	283	10 trust, or a governmental unit.
284	284	11 Sec. 7. (a) As used in this chapter, "residual interest" means
285	285	12 interest that:
286	286	13 (1) accrues on the outstanding balance on a credit card
287	287	14 account from the close of a particular billing cycle until the
288	288	15 cardholder's payment on the account posts; and
289	289	16 (2) may result in a cardholder owing interest even if the
290	290	17 cardholder pays off the full amount shown as outstanding on
291	291	18 the statement issued as of the close of the billing cycle.
292	292	19 (b) The term includes interest described in subsection (a)
293	293	20 regardless of how or whether it is denominated or described by a
294	294	21 card issuer:
295	295	22 (1) on a periodic billing statement;
296	296	23 (2) in the credit card agreement; or
297	297	24 (3) in the terms and conditions of use;
298	298	25 for a credit card.
299	299	26 Sec. 8. A card issuer may not do the following:
300	300	27 (1) Issue, or offer to issue, a credit card to a consumer if,
301	301	28 under the terms and conditions of use applicable to the credit
302	302	29 card, the card issuer is permitted to charge residual interest
303	303	30 on outstanding balances on the credit card account, as
304	304	31 described in section 7(a)(1) of this chapter.
305	305	32 (2) Charge residual interest on the outstanding balance on a
306	306	33 credit card account.
307	307	34 Sec. 9. A card issuer that violates section 8 of this chapter
308	308	35 commits a deceptive act that is actionable by the attorney general
309	309	36 or by a consumer under IC 24-5-0.5-4 and is subject to the
310	310	37 remedies and penalties set forth in IC 24-5-0.5.
311	311	38 SECTION 3. An emergency is declared for this act.
312	312	2023 IN 1494—LS 7398/DI 101