1.1 	A bill for an act
1.2 	relating to commerce; enacting the Uniform Debt-Management Services Act 
1.3 	approved and recommended for enactment in all the states by the National 
1.4 	Conference of Commissioners on Uniform State Laws; making conforming 
1.5 	changes;proposing coding for new law in Minnesota Statutes, chapter 332A; 
1.6 	repealing Minnesota Statutes 2008, sections 332A.02; 332A.03; 332A.04; 
1.7 	332A.05; 332A.06; 332A.07; 332A.08; 332A.09; 332A.10; 332A.11; 332A.12; 
1.8 	332A.13; 332A.14; 332A.16; 332A.17; 332A.18; 332A.19.
1.9 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.10 	Section 1. [332A.20] SHORT TITLE.
1.11 	This chapter may be cited as the Uniform Debt-Management Services Act.

1.12 	Sec. 2. [332A.21] DEFINITIONS.
1.13 	In this chapter:
1.14 	(1) "Administrator" means the commissioner of commerce.
1.15 	(2) "Affiliate":
1.16 	(A) with respect to an individual, means:
1.17 	(i) the spouse of the individual;
1.18 	(ii) a sibling of the individual or the spouse of a sibling;
1.19 	(iii) an individual or the spouse of an individual who is a lineal ancestor or lineal 
1.20 	descendant of the individual or the individual's spouse;
1.21 	(iv) an aunt, uncle, great aunt, great uncle, first cousin, niece, nephew, grandniece, or 
1.22 	grandnephew, whether related by the whole or the half blood or adoption, or the spouse 
1.23 	of any of them; or
1.24 	(v) any other individual occupying the residence of the individual; and
1.25 	(B) with respect to an entity, means:
2.1 	(i) a person that directly or indirectly controls, is controlled by, or is under common 
2.2 	control with the entity;
2.3 	(ii) an officer of, or an individual performing similar functions with respect to, 
2.4 	the entity;
2.5 	(iii) a director of, or an individual performing similar functions with respect to, 
2.6 	the entity;
2.7 	(iv) subject to adjustment of the dollar amount pursuant to section 32(f), a person 
2.8 	that receives or received more than $25,000 from the entity in either the current year or the 
2.9 	preceding year or a person that owns more than ten percent of, or an individual who is 
2.10 	employed by or is a director of, a person that receives or received more than $25,000 from 
2.11 	the entity in either the current year or the preceding year;
2.12 	(v) an officer or director of, or an individual performing similar functions with 
2.13 	respect to, a person described in subsubparagraph (i);
2.14 	(vi) the spouse of, or an individual occupying the residence of, an individual 
2.15 	described in subsubparagraphs (i) through (v); or
2.16 	(vii) an individual who has the relationship specified in subparagraph (A)(iv) to an 
2.17 	individual or the spouse of an individual described in subsubparagraphs (i) through (v).
2.18 	(3) "Agreement" means an agreement between a provider and an individual for the 
2.19 	performance of debt-management services.
2.20 	(4) "Bank" means a financial institution, including a commercial bank, savings bank, 
2.21 	savings and loan association, credit union, and trust company, engaged in the business of 
2.22 	banking, chartered under federal or state law, and regulated by a federal or state banking 
2.23 	regulatory authority. 
2.24 	(5) "Business address" means the physical location of a business, including the name 
2.25 	and number of a street.
2.26 	(6)(A) "Certified counselor" means an individual certified by a training program or 
2.27 	certifying organization, approved by the administrator, that authenticates the competence 
2.28 	of individuals providing education and assistance to other individuals in connection with 
2.29 	debt-management services in which an agreement contemplates that creditors will reduce 
2.30 	finance charges or fees for late payment, default, or delinquency.
2.31 	(B) "Certified debt specialist" means an individual certified by a training program or 
2.32 	certifying organization, approved by the administrator, that authenticates the competence 
2.33 	of individuals providing education and assistance to other individuals in connection with 
2.34 	debt-management services in which an agreement contemplates that creditors will settle 
2.35 	debts for less than the full principle amount of debt owed.
3.1 	(7) "Concessions" means assent to repayment of a debt on terms more favorable to 
3.2 	an individual than the terms of the contract between the individual and a creditor.
3.3 	(8) "Day" means calendar day.
3.4 	(9) "Debt-management services" means services as an intermediary between an 
3.5 	individual and one or more creditors of the individual for the purpose of obtaining 
3.6 	concessions, but does not include:
3.7 	(A) legal services provided in an attorney-client relationship by an attorney licensed 
3.8 	or otherwise authorized to practice law in this state;
3.9 	(B) accounting services provided in an accountant-client relationship by a certified 
3.10 	public accountant licensed to provide accounting services in this state; or
3.11 	(C) financial planning services provided in a financial planner-client relationship 
3.12 	by a member of a financial planning profession whose members the administrator, by 
3.13 	rule, determines are:
3.14 	(i) licensed by this state;
3.15 	(ii) subject to a disciplinary mechanism;
3.16 	(iii) subject to a code of professional responsibility; and
3.17 	(iv) subject to a continuing education requirement.
3.18 	(10) "Entity" means a person other than an individual.
3.19 	(11) "Good faith" means honesty in fact and the observance of reasonable standards 
3.20 	of fair dealing.
3.21 	(12) "Person" means an individual, corporation, business trust, estate, trust, 
3.22 	partnership, limited liability company, association, joint venture, or any other legal or 
3.23 	commercial entity. The term does not include a public corporation, government, or 
3.24 	governmental subdivision, agency, or instrumentality.
3.25 	(13) "Plan" means a program or strategy in which a provider furnishes 
3.26 	debt-management services to an individual and which includes a schedule of payments to 
3.27 	be made by or on behalf of the individual and used to pay debts owed by the individual.
3.28 	(14) "Principal amount of the debt" means the amount of a debt at the time of an 
3.29 	agreement.
3.30 	(15) "Provider" means a person that provides, offers to provide, or agrees to provide 
3.31 	debt-management services directly or through others.
3.32 	(16) "Record" means information that is inscribed on a tangible medium or that is 
3.33 	stored in an electronic or other medium and is retrievable in perceivable form.
3.34 	(17) "Settlement fee" means a charge imposed on or paid by an individual in 
3.35 	connection with a creditor's assent to accept in full satisfaction of a debt an amount less 
3.36 	than the principal amount of the debt.
4.1 	(18) "Sign" means, with present intent to authenticate or adopt a record:
4.2 	(A) to execute or adopt a tangible symbol; or
4.3 	(B) to attach to or logically associate with the record an electronic sound, symbol, 
4.4 	or process.
4.5 	(19) "State" means a state of the United States, the District of Columbia, Puerto 
4.6 	Rico, the United States Virgin Islands, or any territory or insular possession subject to the 
4.7 	jurisdiction of the United States.
4.8 	(20) "Trust account" means an account held by a provider that is:
4.9 	(A) established in an insured bank;
4.10 	(B) separate from other accounts of the provider or its designee;
4.11 	(C) designated as a trust account or other account designated to indicate that the 
4.12 	money in the account is not the money of the provider or its designee; and
4.13 	(D) used to hold money of one or more individuals for disbursement to creditors 
4.14 	of the individuals.

4.15 	Sec. 3. [332A.22] EXEMPT AGREEMENTS AND PERSONS.
4.16 	(a) This chapter does not apply to an agreement with an individual who the provider 
4.17 	has no reason to know resides in this state at the time of the agreement.
4.18 	(b) This chapter does not apply to a provider to the extent that the provider:
4.19 	(1) provides or agrees to provide debt-management, educational, or counseling 
4.20 	services to an individual who the provider has no reason to know resides in this state at the 
4.21 	time the provider agrees to provide the services; or
4.22 	(2) receives no compensation for debt-management services from or on behalf of the 
4.23 	individuals to whom it provides the services or from their creditors.
4.24 	(c) This chapter does not apply to the following persons or their employees when 
4.25 	the person or the employee is engaged in the regular course of the person's business 
4.26 	or profession:
4.27 	(1) a judicial officer, a person acting under an order of a court or an administrative 
4.28 	agency, or an assignee for the benefit of creditors;
4.29 	(2) a bank;
4.30 	(3) an affiliate, as defined in section 332A.21(2)(B)(i), of a bank if the affiliate is 
4.31 	regulated by a federal or state banking regulatory authority; or
4.32 	(4) a title insurer, escrow company, or other person that provides bill-paying services 
4.33 	if the provision of debt-management services is incidental to the bill-paying services.

4.34 	Sec. 4. [332A.23] REGISTRATION REQUIRED.
5.1 	(a) Except as otherwise provided in subsection (b), a provider may not provide 
5.2 	debt-management services to an individual who it reasonably should know resides in 
5.3 	this state at the time it agrees to provide the services, unless the provider is registered 
5.4 	under this chapter.
5.5 	(b) If a provider is registered under this chapter, subsection (a) does not apply to an 
5.6 	employee or agent of the provider.
5.7 	(c) The administrator shall maintain and publicize a list of the names of all registered 
5.8 	providers.

5.9 	Sec. 5. [332A.24] APPLICATION FOR REGISTRATION: FORM, FEE, AND 
5.10 	ACCOMPANYING DOCUMENTS.
5.11 	(a) An application for registration as a provider must be in a form prescribed by the 
5.12 	administrator.
5.13 	(b) Subject to adjustment of dollar amounts pursuant to section 332A.51(f), an 
5.14 	application for registration as a provider must be accompanied by:
5.15 	(1) the fee established by the administrator;
5.16 	(2) the bond required by section 332A.32;
5.17 	(3) identification of all trust accounts required by section 332A.41 and an irrevocable 
5.18 	consent authorizing the administrator to review and examine the trust accounts;
5.19 	(4) evidence of insurance in the amount of $250,000:
5.20 	(A) against the risks of dishonesty, fraud, theft, and other misconduct on the part of 
5.21 	the applicant or a director, employee, or agent of the applicant;
5.22 	(B) issued by an insurance company authorized to do business in this state and 
5.23 	rated at least A or equivalent by a nationally recognized rating organization approved by 
5.24 	the administrator;
5.25 	(C) with a deductible not exceeding $5,000;
5.26 	(D) payable for the benefit of the applicant, this state, and individuals who are 
5.27 	residents of this state, as their interests may appear; and
5.28 	(E) not subject to cancellation by the applicant or the insurer until 60 days after 
5.29 	written notice has been given to the administrator;
5.30 	(5) a certificate of good standing issued pursuant to section 5.12; and
5.31 	(6) if the application is exempt from taxation under the Internal Revenue Code, 
5.32 	United States Code, title 26, section 501, as amended, evidence of that status.

5.33 	Sec. 6. [332A.25] APPLICATION FOR REGISTRATION: REQUIRED 
5.34 	INFORMATION.
6.1 	An application for registration must be signed under oath and include:
6.2 	(1) the applicant's name, principal business address and telephone number, and 
6.3 	all other business addresses in this state, electronic mail addresses, and Internet Web 
6.4 	site addresses;
6.5 	(2) all names under which the applicant conducts business;
6.6 	(3) the address of each location in this state at which the applicant will provide 
6.7 	debt-management services or a statement that the applicant will have no such location;
6.8 	(4) the name and home address of each officer and director of the applicant and each 
6.9 	person that owns at least ten percent of the applicant;
6.10 	(5) identification of every jurisdiction in which, during the five years immediately 
6.11 	preceding the application:
6.12 	(A) the applicant or any of its officers or directors has been licensed or registered 
6.13 	to provide debt-management services; or
6.14 	(B) individuals have resided when they received debt-management services from 
6.15 	the applicant;
6.16 	(6) a statement describing, to the extent it is known or should be known by 
6.17 	the applicant, any material civil or criminal judgment or litigation and any material 
6.18 	administrative or enforcement action by a governmental agency in any jurisdiction against 
6.19 	the applicant, any of its officers, directors, owners, or agents, or any person who is 
6.20 	authorized to have access to the trust account required by section 332A.41;
6.21 	(7) the applicant's financial statements, audited by an accountant licensed to conduct 
6.22 	audits, for each of the two years immediately preceding the application or, if it has not been 
6.23 	in operation for the two years preceding the application, for the period of its existence;
6.24 	(8) evidence of accreditation by an independent accrediting organization approved 
6.25 	by the administrator;
6.26 	(9) evidence that, within 12 months after initial employment, each of the applicant's 
6.27 	counselors becomes certified as a certified counselor or certified debt specialist;
6.28 	(10) a description of the three most commonly used educational programs that the 
6.29 	applicant provides or intends to provide to individuals who reside in this state and a copy 
6.30 	of any materials used or to be used in those programs;
6.31 	(11) a description of the applicant's financial analysis and initial budget plan, 
6.32 	including any form or electronic model, used to evaluate the financial condition of 
6.33 	individuals;
6.34 	(12) a copy of each form of agreement that the applicant will use with individuals 
6.35 	who reside in this state;
7.1 	(13) the schedule of fees and charges that the applicant will use with individuals 
7.2 	who reside in this state;
7.3 	(14) at the applicant's expense, the results of a criminal-records check, including 
7.4 	fingerprints, conducted within the immediately preceding 12 months, covering every 
7.5 	officer of the applicant and every employee or agent of the applicant who is authorized to 
7.6 	have access to the trust account required by section 332A.41;
7.7 	(15) the names and addresses of all employers of each director during the ten years 
7.8 	immediately preceding the application;
7.9 	(16) a description of any ownership interest of at least ten percent by a director, 
7.10 	owner, or employee of the applicant in:
7.11 	(A) any affiliate of the applicant; or
7.12 	(B) any entity that provides products or services to the applicant or any individual 
7.13 	relating to the applicant's debt-management services;
7.14 	(17) a statement of the amount of compensation of the applicant's five most highly 
7.15 	compensated employees for each of the three years immediately preceding the application 
7.16 	or, if it has not been in operation for the three years preceding the application, for the 
7.17 	period of its existence;
7.18 	(18) the identity of each director who is an affiliate, as defined in section 
7.19 	332A.21(2)(A) or (B)(i), (ii), (iv), (v), (vi), or (vii), of the applicant; and
7.20 	(19) any other information that the administrator reasonably requires to perform the 
7.21 	administrator's duties under section 332A.28.

7.22 	Sec. 7. [332A.26] APPLICATION FOR REGISTRATION: OBLIGATION TO 
7.23 	UPDATE INFORMATION.
7.24 	An applicant or registered provider shall notify the administrator within ten days 
7.25 	after a change in the information specified in section 332A.24(b)(4) or (6) or 6(1), (3), (6), 
7.26 	(12), or (13).

7.27 	Sec. 8. [332A.27] APPLICATION FOR REGISTRATION: PUBLIC 
7.28 	INFORMATION.
7.29 	Except for the information required by section 332A.25(7), (14), and (17); and the 
7.30 	addresses required by section 332A.25(4), the administrator shall make the information in 
7.31 	an application for registration as a provider available to the public.

7.32 	Sec. 9. [332A.28] CERTIFICATE OF REGISTRATION: ISSUANCE OR 
7.33 	DENIAL.
8.1 	(a) Except as otherwise provided in subsections (c) and (d), the administrator shall 
8.2 	issue a certificate of registration as a provider to a person that complies with sections 
8.3 	5 and 6.
8.4 	(b) If an applicant has otherwise complied with sections 332A.24 and 332A.25, 
8.5 	including a timely effort to obtain the information required by section 332A.25(14) but the 
8.6 	information has not been received, the administrator may issue a temporary certificate of 
8.7 	registration. The temporary certificate shall expire no later than 180 days after issuance.
8.8 	(c) The administrator may deny registration if:
8.9 	(1) the application contains information that is materially erroneous or incomplete;
8.10 	(2) an officer, director, or owner of the applicant has been convicted of a crime, 
8.11 	or suffered a civil judgment, involving dishonesty or the violation of state or federal 
8.12 	securities laws;
8.13 	(3) the applicant or any of its officers, directors, or owners has defaulted in the 
8.14 	payment of money collected for others; or
8.15 	(4) the administrator finds that the financial responsibility, experience, character, 
8.16 	or general fitness of the applicant or its owners, directors, employees, or agents does not 
8.17 	warrant belief that the business will be operated in compliance with this chapter.
8.18 	(d) The administrator shall deny registration if, with respect to an applicant that is 
8.19 	organized as a not-for-profit entity or has obtained tax-exempt status under the Internal 
8.20 	Revenue Code, United States Code, title 26, section 501, as amended, the applicant's board 
8.21 	of directors is not independent of the applicant's employees and agents.
8.22 	(e) Subject to adjustment of the dollar amount pursuant to section 32(f), a board of 
8.23 	directors is not independent for purposes of subsection (d) if more than one-fourth of its 
8.24 	members:
8.25 	(1) are affiliates of the applicant, as defined in section 332A.21(2)(A) or (B)(i), (ii), 
8.26 	(iv), (v), (vi), or (vii); or
8.27 	(2) after the date ten years before first becoming a director of the applicant, were 
8.28 	employed by or directors of a person that received from the applicant more than $25,000 
8.29 	in either the current year or the preceding year.

8.30 	Sec. 10. [332A.29] CERTIFICATE OF REGISTRATION: TIMING.
8.31 	(a) The administrator shall approve or deny an initial registration as a provider 
8.32 	within 120 days after an application is filed. In connection with a request pursuant to 
8.33 	section 332A.25(19) for additional information, the administrator may extend the 120-day 
8.34 	period for not more than 60 days. Within seven days after denying an application, the 
8.35 	administrator, in a record, shall inform the applicant of the reasons for the denial.
9.1 	(b) If the administrator denies an application for registration as a provider or does 
9.2 	not act on an application within the time prescribed in subsection (a), the applicant may 
9.3 	appeal and request a hearing pursuant to chapter 14.
9.4 	(c) Subject to sections 332A.30(d) and 332A.53, a registration as a provider is 
9.5 	valid for one year.

9.6 	Sec. 11. [332A.30] RENEWAL OF REGISTRATION.
9.7 	(a) A provider must obtain a renewal of its registration annually.
9.8 	(b) An application for renewal of registration as a provider must be in a form 
9.9 	prescribed by the administrator, signed under oath, and:
9.10 	(1) be filed no fewer than 30 and no more than 60 days before the registration expires;
9.11 	(2) be accompanied by the fee established by the administrator and the bond required 
9.12 	by section 332A.32;
9.13 	(3) contain the matter required for initial registration as a provider by section 
9.14 	332A.25(8) and (9) and a financial statement, audited by an accountant licensed to conduct 
9.15 	audits, for the applicant's fiscal year immediately preceding the application;
9.16 	(4) disclose any changes in the information contained in the applicant's application 
9.17 	for registration or its immediately previous application for renewal, as applicable. If an 
9.18 	application is otherwise complete and the applicant has made a timely effort to obtain the 
9.19 	information required by section 332A.25(14) but the information has not been received, 
9.20 	the administrator may issue a temporary renewal of registration. The temporary renewal 
9.21 	shall expire no later than 180 days after issuance;
9.22 	(5) supply evidence of insurance in an amount equal to the larger of $250,000 or 
9.23 	the highest daily balance in the trust account required by section 332A.41 during the 
9.24 	six-month period immediately preceding the application:
9.25 	(A) against risks of dishonesty, fraud, theft, and other misconduct on the part of the 
9.26 	applicant or a director, employee, or agent of the applicant;
9.27 	(B) issued by an insurance company authorized to do business in this state and 
9.28 	rated at least A or equivalent by a nationally recognized rating organization approved by 
9.29 	the administrator;
9.30 	(C) with a deductible not exceeding $5,000;
9.31 	(D) payable for the benefit of the applicant, this state, and individuals who are 
9.32 	residents of this state, as their interests may appear; and
9.33 	(E) not subject to cancellation by the applicant or the insurer until 60 days after 
9.34 	written notice has been given to the administrator;
10.1 	(6) disclose the total amount of money received by the applicant pursuant to plans 
10.2 	during the preceding 12 months from or on behalf of individuals who reside in this 
10.3 	state and the total amount of money distributed to creditors of those individuals during 
10.4 	that period;
10.5 	(7) disclose, to the best of the applicant's knowledge, the gross amount of money 
10.6 	accumulated during the preceding 12 months pursuant to plans by or on behalf of 
10.7 	individuals who reside in this state and with whom the applicant has agreements; and
10.8 	(8) provide any other information that the administrator reasonably requires to 
10.9 	perform the administrator's duties under this section.
10.10 	(c) Except for the information required by section 332A.25(7), (14), and (17); and 
10.11 	the addresses required by section 332A.25(4), the administrator shall make the information 
10.12 	in an application for renewal of registration as a provider available to the public. 
10.13 	(d) If a registered provider files a timely and complete application for renewal of 
10.14 	registration, the registration remains effective until the administrator, in a record, notifies 
10.15 	the applicant of a denial and states the reasons for the denial.
10.16 	(e) If the administrator denies an application for renewal of registration as a provider, 
10.17 	the applicant, within 30 days after receiving notice of the denial, may appeal and request a 
10.18 	hearing pursuant to chapter 14. Subject to section 332A.53, while the appeal is pending 
10.19 	the applicant shall continue to provide debt-management services to individuals with 
10.20 	whom it has agreements. If the denial is affirmed, subject to the administrator's order and 
10.21 	section 332A.53, the applicant shall continue to provide debt-management services to 
10.22 	individuals with whom it has agreements until, with the approval of the administrator, it 
10.23 	transfers the agreements to another registered provider or returns to the individuals all 
10.24 	unexpended money that is under the applicant's control.

10.25 	Sec. 12. [332A.31] REGISTRATION IN ANOTHER STATE.
10.26 	If a provider holds a license or certificate of registration in another state authorizing 
10.27 	it to provide debt-management services, the provider may submit a copy of that license 
10.28 	or certificate and the application for it instead of an application in the form prescribed 
10.29 	by section 332A.24(a), 332A.25, or 332A.30(b). The administrator shall accept the 
10.30 	application and the license or certificate from the other state as an application for 
10.31 	registration as a provider or for renewal of registration as a provider, as appropriate, 
10.32 	in this state if:
10.33 	(1) the application in the other state contains information substantially similar to or 
10.34 	more comprehensive than that required in an application submitted in this state;
11.1 	(2) the applicant provides the information required by section 332A.25(1), (3), 
11.2 	(10), (12), and (13); and
11.3 	(3) the applicant, under oath, certifies that the information contained in the 
11.4 	application is current or, to the extent it is not current, supplements the application to make 
11.5 	the information current.

11.6 	Sec. 13. [332A.32] BOND REQUIRED.
11.7 	(a) Except as otherwise provided in section 332A.23, a provider that is required to 
11.8 	be registered under this chapter shall file a surety bond with the administrator, which must:
11.9 	(1) be in effect during the period of registration and for two years after the provider 
11.10 	ceases providing debt-management services to individuals in this state; and
11.11 	(2) run to this state for the benefit of this state and of individuals who reside in this 
11.12 	state when they agree to receive debt-management services from the provider, as their 
11.13 	interests may appear.
11.14 	(b) Subject to adjustment of the dollar amount pursuant to section 32(f), a surety 
11.15 	bond filed pursuant to subsection (a) must:
11.16 	(1) be in the amount of $50,000 or other larger or smaller amount that the 
11.17 	administrator determines is warranted by the financial condition and business experience 
11.18 	of the provider, the history of the provider in performing debt-management services, the 
11.19 	risk to individuals, and any other factor the administrator considers appropriate;
11.20 	(2) be issued by a bonding, surety, or insurance company authorized to do business 
11.21 	in this state and rated at least A by a nationally recognized rating organization; and
11.22 	(3) have payment conditioned upon noncompliance of the provider or its agent 
11.23 	with this chapter.
11.24 	(c) If the principal amount of a surety bond is reduced by payment of a claim or a 
11.25 	judgment, the provider shall immediately notify the administrator and, within 30 days 
11.26 	after notice by the administrator, file a new or additional surety bond in an amount set by 
11.27 	the administrator. The amount of the new or additional bond must be at least the amount of 
11.28 	the bond immediately before payment of the claim or judgment. If for any reason a surety 
11.29 	terminates a bond, the provider shall immediately file a new surety bond in the amount of 
11.30 	$50,000 or other amount determined pursuant to subsection (b).
11.31 	(d) The administrator or an individual may obtain satisfaction out of the surety 
11.32 	bond procured pursuant to this section if:
11.33 	(1) the administrator assesses expenses under section 332A.51(b)(1), issues a 
11.34 	final order under section 332A.52(a)(2), or recovers a final judgment under section 
11.35 	332A.52(a)(4) or (5) or (d); or
12.1 	(2) an individual recovers a final judgment pursuant to section 332A.54(a), (b), 
12.2 	or (c)(1), (2), or (4).
12.3 	(e) If claims against a surety bond exceed or are reasonably expected to exceed the 
12.4 	amount of the bond, the administrator, on the initiative of the administrator or on petition 
12.5 	of the surety, shall, unless the proceeds are adequate to pay all costs, judgments, and 
12.6 	claims, distribute the proceeds in the following order:
12.7 	(1) to satisfaction of a final order or judgment under section 332A.52(a)(2), (4), or 
12.8 	(5) or (d);
12.9 	(2) to final judgments recovered by individuals pursuant to section 332A.54(a), 
12.10 	(b), or (c)(1), (2), or (4), pro rata;
12.11 	(3) to claims of individuals established to the satisfaction of the administrator, pro 
12.12 	rata; and
12.13 	(4) if a final order or judgment is issued under section 332A.52(a), to the expenses 
12.14 	charged pursuant to section 332A.51(b)(1).

12.15 	Sec. 14. [332A.33] BOND REQUIRED: SUBSTITUTE.
12.16 	(a) Instead of the surety bond required by section 332A.32, a provider may deliver to 
12.17 	the administrator, in the amount required by section 332A.32(b), and, except as otherwise 
12.18 	provided in paragraph (2)(A), payable or available to this state and to individuals who 
12.19 	reside in this state when they agree to receive debt-management services from the provider, 
12.20 	as their interests may appear, if the provider or its agent does not comply with this chapter:
12.21 	(1) a certificate of insurance:
12.22 	(A) issued by an insurance company authorized to do business in this state and rated 
12.23 	at least A or equivalent by a nationally recognized rating organization approved by the 
12.24 	administrator; and
12.25 	(B) with no deductible, or if the provider supplies a bond in the amount of $5,000, a 
12.26 	deductible not exceeding $5,000; or
12.27 	(2) with the approval of the administrator:
12.28 	(A) an irrevocable letter of credit, issued or confirmed by a bank approved by the 
12.29 	administrator, payable upon presentation of a certificate by the administrator stating that 
12.30 	the provider or its agent has not complied with this chapter; or
12.31 	(B) bonds or other obligations of the United States or guaranteed by the United 
12.32 	States or bonds or other obligations of this state or a political subdivision of this state, to 
12.33 	be deposited and maintained with a bank approved by the administrator for this purpose.
12.34 	(b) If a provider furnishes a substitute pursuant to subsection (a), the provisions of 
12.35 	section 332A.32(a), (c), (d), and (e) apply to the substitute.

13.1 	Sec. 15. [332A.34] REQUIREMENT OF GOOD FAITH.
13.2 	A provider shall act in good faith in all matters under this chapter.

13.3 	Sec. 16. [332A.35] CUSTOMER SERVICE.
13.4 	A provider that is required to be registered under this chapter shall maintain a 
13.5 	toll-free communication system, staffed at a level that reasonably permits an individual to 
13.6 	speak to a certified counselor, certified debt specialist, or customer service representative, 
13.7 	as appropriate, during ordinary business hours.

13.8 	Sec. 17. [332A.36] PREREQUISITES FOR PROVIDING DEBT-MANAGEMENT 
13.9 	SERVICES.
13.10 	(a) Before providing debt-management services, a registered provider shall give the 
13.11 	individual an itemized list of goods and services and the charges for each. The list must be 
13.12 	clear and conspicuous, be in a record the individual may keep whether or not the individual 
13.13 	assents to an agreement, and describe the goods and services the provider offers:
13.14 	(1) free of additional charge if the individual enters into an agreement;
13.15 	(2) for a charge if the individual does not enter into an agreement; and
13.16 	(3) for a charge if the individual enters into an agreement, using the following 
13.17 	terminology, as applicable, and format:

13.18		Setup fee
	_____
		
13.19			dollar amount of fee
		
13.20
13.21		Monthly 
service fee
	_____
		
13.22			dollar amount of fee or method of determining amount
		
13.23
13.24		Settlement 
fee
	_____
		
13.25			dollar amount of fee or method of determining amount
		
13.26
13.27		Goods and services in addition to those provided in connection 
with a plan:
		
13.28		_____
	_____
		
13.29		(item)
	dollar amount or method of determining amount
		
13.30		_____
	_____
		
13.31		item
	dollar amount or method of determining amount.
		
13.32 	(b) A provider may not furnish debt-management services unless the provider, 
13.33 	through the services of a certified counselor or certified debt specialist:
13.34 	(1) provides the individual with reasonable education about the management of 
13.35 	personal finance;
13.36 	(2) has prepared a financial analysis; and
13.37 	(3) if the individual is to make regular, periodic payments:
14.1 	(A) has prepared a plan for the individual;
14.2 	(B) has made a determination, based on the provider's analysis of the information 
14.3 	provided by the individual and otherwise available to it, that the plan is suitable for the 
14.4 	individual and the individual will be able to meet the payment obligations under the 
14.5 	plan; and
14.6 	(C) believes that each creditor of the individual listed as a participating creditor in 
14.7 	the plan will accept payment of the individual's debts as provided in the plan.
14.8 	(c) Before an individual assents to an agreement to engage in a plan, a provider shall:
14.9 	(1) provide the individual with a copy of the analysis and plan required by subsection 
14.10 	(b) in a record that identifies the provider and that the individual may keep whether or not 
14.11 	the individual assents to the agreement;
14.12 	(2) inform the individual of the availability, at the individual's option, of assistance 
14.13 	by a toll-free communication system or in person to discuss the financial analysis and plan 
14.14 	required by subsection (b); and
14.15 	(3) with respect to all creditors identified by the individual or otherwise known by 
14.16 	the provider to be creditors of the individual, provide the individual with a list of:
14.17 	(A) creditors that the provider expects to participate in the plan and grant 
14.18 	concessions;
14.19 	(B) creditors that the provider expects to participate in the plan but not grant 
14.20 	concessions;
14.21 	(C) creditors that the provider expects not to participate in the plan; and
14.22 	(D) all other creditors.
14.23 	(d) Before an individual assents to an agreement, the provider shall inform the 
14.24 	individual, in a record that contains nothing else, that is given separately, and that the 
14.25 	individual may keep whether or not the individual assents to the agreement:
14.26 	(1) of the name and business address of the provider;
14.27 	(2) that plans are not suitable for all individuals and the individual may ask the 
14.28 	provider about other ways, including bankruptcy, to deal with indebtedness;
14.29 	(3) that establishment of a plan may adversely affect the individual's credit rating or 
14.30 	credit scores;
14.31 	(4) that nonpayment of debt may lead creditors to increase finance and other charges 
14.32 	or undertake collection activity, including litigation;
14.33 	(5) unless it is not true, that the provider may receive compensation from the 
14.34 	creditors of the individual; and
15.1 	(6) that, unless the individual is insolvent, if a creditor settles for less than the full 
15.2 	amount of the debt, the plan may result in the creation of taxable income to the individual, 
15.3 	even though the individual does not receive any money.
15.4 	(e) If a provider may receive payments from an individual's creditors and the 
15.5 	plan contemplates that the individual's creditors will reduce finance charges or fees for 
15.6 	late payment, default, or delinquency, the provider may comply with subsection (d) by 
15.7 	providing the following disclosure, surrounded by black lines:

15.8	IMPORTANT INFORMATION FOR YOU TO CONSIDER
	
15.915.10
15.11
		(1) Debt-management plans are not right for all individuals, and you 
may ask us to provide information about other ways, including bankruptcy, to 
deal with your debts.
	
15.12
15.13		(2) Using a debt-management plan may make it harder for you to 
obtain credit.
	
15.14
15.15		(3) We may receive compensation for our services from your 
creditors.
	
15.16			_____
		
15.17			Name and business address of provider
		
15.18 	(f) If a provider will not receive payments from an individual's creditors and the plan 
15.19 	contemplates that the individual's creditors will reduce finance charges or fees for late 
15.20 	payment, default, or delinquency, a provider may comply with subsection (d) by providing 
15.21 	the following disclosure, surrounded by black lines:

15.22	IMPORTANT INFORMATION FOR YOU TO CONSIDER
	
15.23
15.24
15.25		(1) Debt-management plans are not right for all individuals, and you 
may ask us to provide information about other ways, including bankruptcy, to 
deal with your debts.
	
15.26
15.27		(2) Using a debt-management plan may make it harder for you to 
obtain credit.
	
15.28			_____
		
15.29			Name and business address of provider
		
15.30 	(g) If an agreement contemplates that creditors will settle debts for less than the full 
15.31 	principal amount of debt owed, a provider may comply with subsection (d) by providing 
15.32 	the following disclosure, surrounded by black lines:

15.33	IMPORTANT INFORMATION FOR YOU TO CONSIDER
	
15.34
15.35		(1) Our program is not right for all individuals, and you may ask us to 
provide information about bankruptcy and other ways to deal with your debts.
	
15.36
15.37
15.38
15.39		(2) Nonpayment of your debts under our program may  hurt your 
credit rating or credit scores;  lead your creditors to increase finance and other 
charges; and  lead your creditors to undertake activity, including lawsuits, to 
collect the debts.
	
15.40
15.41		(3) Reduction of debt under our program may result in taxable 
income to you, even though you will not actually receive any money.
	
16.1			_____
		
16.2			Name and business address of provider

16.3 	Sec. 18. [332A.37] COMMUNICATION BY ELECTRONIC OR OTHER 
16.4 	MEANS.
16.5 	(a) In this section:
16.6 	(1) "Federal act" means the Electronic Signatures in Global and National Commerce 
16.7 	Act, United States Code, title 15, section 7001 et seq, as amended.
16.8 	(2) "Consumer" means an individual who seeks or obtains goods or services that are 
16.9 	used primarily for personal, family, or household purposes.
16.10 	(b) A provider may satisfy the requirements of section 332A.36, 332A.38, or 
16.11 	332A.46 by means of the Internet or other electronic means if the provider obtains a 
16.12 	consumer's consent in the manner provided by section 101(c)(1) of the federal act.
16.13 	(c) The disclosures and materials required by sections 332A.36, 332A.38, and 
16.14 	332A.46 shall be presented in a form that is capable of being accurately reproduced for 
16.15 	later reference.
16.16 	(d) With respect to disclosure by means of an Internet Web site, the disclosure of the 
16.17 	information required by section 332A.36(d) must appear on one or more screens that:
16.18 	(1) contain no other information; and
16.19 	(2) the individual must see before proceeding to assent to formation of an agreement.
16.20 	(e) At the time of providing the materials and agreement required by sections 
16.21 	332A.36(c) and (d), 332A.38, and 332A.46, a provider shall inform the individual that 
16.22 	upon electronic, telephonic, or written request, it will send the individual a written copy of 
16.23 	the materials, and shall comply with a request as provided in subsection (f).
16.24 	(f) If a provider is requested, before the expiration of 90 days after an agreement 
16.25 	is completed or terminated, to send a written copy of the materials required by section 
16.26 	332A.36(c) and (d), 332A.38, or 332A.46, the provider shall send them at no charge 
16.27 	within three business days after the request is received, but the provider need not comply 
16.28 	with a request more than once per calendar month or if it reasonably believes the request 
16.29 	is made for purposes of harassment. If a request is made more than 90 days after an 
16.30 	agreement is completed or terminated, the provider shall send within a reasonable time a 
16.31 	written copy of the materials requested.
16.32 	(g) A provider that maintains an Internet Web site shall disclose on the home page of 
16.33 	its Web site or on a page that is clearly and conspicuously connected to the home page 
16.34 	by a link that clearly reveals its contents:
16.35 	(1) its name and all names under which it does business;
17.1 	(2) its principal business address, telephone number, and electronic-mail address, if 
17.2 	any; and
17.3 	(3) the names of its principal officers.
17.4 	(h) Subject to subsection (i), if a consumer who has consented to electronic 
17.5 	communication in the manner provided by section 101 of the federal act withdraws consent 
17.6 	as provided in the federal act, a provider may terminate its agreement with the consumer.
17.7 	(i) If a provider wishes to terminate an agreement with a consumer pursuant to 
17.8 	subsection (h), it shall notify the consumer that it will terminate the agreement unless 
17.9 	the consumer, within 30 days after receiving the notification, consents to electronic 
17.10 	communication in the manner provided in section 101(c) of the federal act. If the 
17.11 	consumer consents, the provider may terminate the agreement only as permitted by 
17.12 	section 332A.38(a)(6)(G).

17.13 	Sec. 19. [332A.38] FORM AND CONTENTS OF AGREEMENT.
17.14 	(a) An agreement must:
17.15 	(1) be in a record;
17.16 	(2) be dated and signed by the provider and the individual;
17.17 	(3) include the name of the individual and the address where the individual resides;
17.18 	(4) include the name, business address, and telephone number of the provider;
17.19 	(5) be delivered to the individual immediately upon formation of the agreement; and
17.20 	(6) disclose:
17.21 	(A) the services to be provided;
17.22 	(B) the amount, or method of determining the amount, of all fees, individually 
17.23 	itemized, to be paid by the individual;
17.24 	(C) the schedule of payments to be made by or on behalf of the individual, including 
17.25 	the amount of each payment, the date on which each payment is due, and an estimate 
17.26 	of the date of the final payment;
17.27 	(D) if a plan provides for regular periodic payments to creditors:
17.28 	(i) each creditor of the individual to which payment will be made, the amount owed 
17.29 	to each creditor, and any concessions the provider reasonably believes each creditor will 
17.30 	offer; and
17.31 	(ii) the schedule of expected payments to each creditor, including the amount of each 
17.32 	payment and the date on which it will be made;
17.33 	(E) each creditor that the provider believes will not participate in the plan and to 
17.34 	which the provider will not direct payment;
17.35 	(F) how the provider will comply with its obligations under section 332A.46(a);
18.1 	(G) that the provider may terminate the agreement for good cause, upon return 
18.2 	of unexpended money of the individual;
18.3 	(H) that the individual may cancel the agreement as provided in section 332A.39;
18.4 	(I) that the individual may contact the administrator with any questions or complaints 
18.5 	regarding the provider; and
18.6 	(J) the address, telephone number, and Internet address or Web site of the 
18.7 	administrator.
18.8 	(b) For purposes of subsection (a)(5), delivery of an electronic record occurs when it 
18.9 	is made available in a format in which the individual may retrieve, save, and print it and 
18.10 	the individual is notified that it is available.
18.11 	(c) If the administrator supplies the provider with any information required under 
18.12 	subsection (a)(6)(J), the provider may comply with that requirement only by disclosing the 
18.13 	information supplied by the administrator.
18.14 	(d) An agreement must provide that:
18.15 	(1) the individual has a right to terminate the agreement at any time, without penalty 
18.16 	or obligation, by giving the provider written or electronic notice, in which event:
18.17 	(A) the provider will refund all unexpended money that the provider or its agent 
18.18 	has received from or on behalf of the individual for the reduction or satisfaction of the 
18.19 	individual's debt;
18.20 	(B) with respect to an agreement that contemplates that creditors will settle debts for 
18.21 	less than the principal amount of debt, the provider will refund 65 percent of any portion 
18.22 	of the setup fee that has not been credited against the settlement fee; and
18.23 	(C) all powers of attorney granted by the individual to the provider are revoked 
18.24 	and ineffective;
18.25 	(2) the individual authorizes any bank in which the provider or its agent has 
18.26 	established a trust account to disclose to the administrator any financial records relating 
18.27 	to the trust account; and
18.28 	(3) the provider will notify the individual within five days after learning of a 
18.29 	creditor's final decision to reject or withdraw from a plan and that this notice will include:
18.30 	(A) the identity of the creditor; and
18.31 	(B) the right of the individual to modify or terminate the agreement.
18.32 	(e) An agreement may confer on a provider a power of attorney to settle the 
18.33 	individual's debt for no more than 50 percent of the principal amount of the debt. An 
18.34 	agreement may not confer a power of attorney to settle a debt for more than 50 percent 
18.35 	of that amount, but may confer a power of attorney to negotiate with creditors of the 
18.36 	individual on behalf of the individual. An agreement must provide that the provider will 
19.1 	obtain the assent of the individual after a creditor has assented to a settlement for more 
19.2 	than 50 percent of the principal amount of the debt.
19.3 	(f) An agreement may not:
19.4 	(1) provide for application of the law of any jurisdiction other than the United States 
19.5 	and this state;
19.6 	(2) except as permitted by section 2 of the Federal Arbitration Act, United States 
19.7 	Code, title 9, section 2, as amended, or sections 572.08 to 572.30, contain a provision that 
19.8 	modifies or limits otherwise available forums or procedural rights, including the right to 
19.9 	trial by jury, that are generally available to the individual under law other than this chapter;
19.10 	(3) contain a provision that restricts the individual's remedies under this chapter 
19.11 	or law other than this chapter; or
19.12 	(4) contain a provision that:
19.13 	(A) limits or releases the liability of any person for not performing the agreement 
19.14 	or for violating this chapter; or
19.15 	(B) indemnifies any person for liability arising under the agreement or this chapter.
19.16 	(g) All rights and obligations specified in subsection (d) and section 332A.39 exist 
19.17 	even if not provided in the agreement. A provision in an agreement which violates 
19.18 	subsection (d), (e), or (f) is void.

19.19 	Sec. 20. [332A.39] CANCELLATION OF AGREEMENT; WAIVER.
19.20 	(a) An individual may cancel an agreement before midnight of the third business day 
19.21 	after the individual assents to it, unless the agreement does not comply with subsection (b) 
19.22 	or section 19 or 28, in which event the individual may cancel the agreement within 30 
19.23 	days after the individual assents to it. To exercise the right to cancel, the individual must 
19.24 	give notice in a record to the provider. Notice by mail is given when mailed.
19.25 	(b) An agreement must be accompanied by a form that contains in bold-face type, 
19.26 	surrounded by bold black lines:

19.27	Notice of Right to Cancel
	
19.28
19.29
19.30		You may cancel this agreement, without any penalty or obligation, at 
any time before midnight of the third business day that begins the day after 
you agree to it by electronic communication or by signing it.
	
19.31		To cancel this agreement during this period, send an e-mail to
	
19.32		_____ or mail or deliver a signed, dated copy of
	
19.33		E-mail address of provider
			
19.34		this notice, or any other written notice to 
_____	
19.35			Name of provider
	
19.36		at _____ before midnight on
	_____.
	
19.37		Address of provider
		Date
	
20.1
20.2		If you cancel this agreement within the three-day period, we will refund all 
money you already have paid us.
	
20.3
20.4		You also may terminate this agreement at any later time, but we may 
not be required to refund fees you have paid us.

20.5		I cancel this agreement,
		
20.6		_____
		
20.7		Print your name
		
20.8		_____
		
20.9		Signature
		
20.10		_____
		
20.11		Date
		
20.12 	(c) If a personal financial emergency necessitates the disbursement of an individual's 
20.13 	money to one or more of the individual's creditors before the expiration of three days after 
20.14 	an agreement is signed, an individual may waive the right to cancel. To waive the right, 
20.15 	the individual must send or deliver a signed, dated statement in the individual's own words 
20.16 	describing the circumstances that necessitate a waiver. The waiver must explicitly waive 
20.17 	the right to cancel. A waiver by means of a standard-form record is void.

20.18 	Sec. 21. [332A.40] REQUIRED LANGUAGE.
20.19 	Unless the administrator, by rule, provides otherwise, the disclosures and documents 
20.20 	required by this chapter must be in English. If a provider communicates with an individual 
20.21 	primarily in a language other than English, the provider must furnish a translation into the 
20.22 	other language of the disclosures and documents required by this chapter.

20.23 	Sec. 22. [332A.41] TRUST ACCOUNT.
20.24 	(a) All money paid to a provider by or on behalf of an individual for distribution 
20.25 	to creditors pursuant to a plan is held in trust. Within two business days after receipt, 
20.26 	the provider shall deposit the money in a trust account established for the benefit of 
20.27 	individuals to whom the provider is furnishing debt-management services.
20.28 	(b) Money held in trust by a provider is not property of the provider or its designee. 
20.29 	The money is not available to creditors of the provider or designee, except an individual 
20.30 	from whom or on whose behalf the provider received money, to the extent that the money 
20.31 	has not been disbursed to creditors of the individual.
20.32 	(c) A provider shall:
20.33 	(1) maintain separate records of account for each individual to whom the provider 
20.34 	is furnishing debt-management services;
21.1 	(2) disburse money paid by or on behalf of the individual to creditors of the 
21.2 	individual as disclosed in the agreement, except that:
21.3 	(A) the provider may delay payment to the extent that a payment by the individual is 
21.4 	not final; and
21.5 	(B) if a plan provides for regular periodic payments to creditors, the disbursement 
21.6 	must comply with the due dates established by each creditor; and
21.7 	(3) promptly correct any payments that are not made or that are misdirected as 
21.8 	a result of an error by the provider or other person in control of the trust account and 
21.9 	reimburse the individual for any costs or fees imposed by a creditor as a result of the 
21.10 	failure to pay or misdirection.
21.11 	(d) A provider may not commingle money in a trust account established for the 
21.12 	benefit of individuals to whom the provider is furnishing debt-management services with 
21.13 	money of other persons.
21.14 	(e) A trust account must at all times have a cash balance equal to the sum of the 
21.15 	balances of each individual's account.
21.16 	(f) If a provider has established a trust account pursuant to subsection (a), the 
21.17 	provider shall reconcile the trust account at least once a month. The reconciliation must 
21.18 	compare the cash balance in the trust account with the sum of the balances in each 
21.19 	individual's account. If the provider or its designee has more than one trust account, each 
21.20 	trust account must be individually reconciled.
21.21 	(g) If a provider discovers, or has a reasonable suspicion of, embezzlement or other 
21.22 	unlawful appropriation of money held in trust, the provider immediately shall notify the 
21.23 	administrator by a method approved by the administrator. Unless the administrator by 
21.24 	rule provides otherwise, within five days thereafter, the provider shall give notice to the 
21.25 	administrator describing the remedial action taken or to be taken.
21.26 	(h) If an individual terminates an agreement or it becomes reasonably apparent to 
21.27 	a provider that a plan has failed, the provider shall promptly refund to the individual all 
21.28 	money paid by or on behalf of the individual which has not been paid to creditors, less 
21.29 	fees that are payable to the provider under section 332A.42.
21.30 	(i) Before relocating a trust account from one bank to another, a provider shall 
21.31 	inform the administrator of the name, business address, and telephone number of the new 
21.32 	bank. As soon as practicable, the provider shall inform the administrator of the account 
21.33 	number of the trust account at the new bank.

21.34 	Sec. 23. [332A.42] FEES AND OTHER CHARGES.
22.1 	(a) A provider may not impose directly or indirectly a fee or other charge on an 
22.2 	individual or receive money from or on behalf of an individual for debt-management 
22.3 	services except as permitted by this section.
22.4 	(b) A provider may not impose charges or receive payment for debt-management 
22.5 	services until the provider and the individual have signed an agreement that complies with 
22.6 	sections 332A.38 and 332A.47.
22.7 	(c) If an individual assents to an agreement, a provider may not impose a fee or other 
22.8 	charge for educational or counseling services, or the like, except as otherwise provided 
22.9 	in this subsection and section 332A.47(d). The administrator may authorize a provider 
22.10 	to charge a fee based on the nature and extent of the educational or counseling services 
22.11 	furnished by the provider.
22.12 	(d) Subject to adjustment of dollar amounts pursuant to section 332A.51(f), the 
22.13 	following rules apply:
22.14 	(1) If an individual assents to a plan that contemplates that creditors will reduce 
22.15 	finance charges or fees for late payment, default, or delinquency, the provider may charge:
22.16 	(A) a fee not exceeding $50 for consultation, obtaining a credit report, setting up an 
22.17 	account, and the like; and
22.18 	(B) a monthly service fee, not to exceed $10 times the number of creditors remaining 
22.19 	in a plan at the time the fee is assessed, but not more than $50 in any month.
22.20 	(2) If an individual assents to an agreement that contemplates that creditors will 
22.21 	settle debts for less than the principal amount of the debt, a provider may charge:
22.22 	(A) subject to section 332A.38(d), a fee for consultation, obtaining a credit report, 
22.23 	setting up an account, and the like, in an amount not exceeding the lesser of $400 and four 
22.24 	percent of the debt in the plan at the inception of the plan; and
22.25 	(B) a monthly service fee, not to exceed $10 times the number of creditors remaining 
22.26 	in a plan at the time the fee is assessed, but not more than $50 in any month.
22.27 	(3) A provider may not impose or receive fees under both paragraphs (1) and (2).
22.28 	(4) Except as otherwise provided in section 332A.47(d), if an individual does not 
22.29 	assent to an agreement, a provider may receive for educational and counseling services 
22.30 	it provides to the individual a fee not exceeding $100 or, with the approval of the 
22.31 	administrator, a larger fee. The administrator may approve a fee larger than $100 if the 
22.32 	nature and extent of the educational and counseling services warrant the larger fee.
22.33 	(e) If, before the expiration of 90 days after the completion or termination of 
22.34 	educational or counseling services, an individual assents to an agreement, the provider 
22.35 	shall refund to the individual any fee paid pursuant to subsection (d)(4).
23.1 	(f) Except as otherwise provided in subsections (c) and (d), if an agreement 
23.2 	contemplates that creditors will settle an individual's debts for less than the principal 
23.3 	amount of the debt, compensation for services in connection with settling a debt may not 
23.4 	exceed, with respect to each debt:
23.5 	(1) 30 percent of the excess of the principal amount of the debt over the amount paid 
23.6 	the creditor pursuant to the agreement, less
23.7 	(2) to the extent it has not been credited against an earlier settlement fee:
23.8 	(A) the fee charged pursuant to subsection (d)(2)(A); and
23.9 	(B) the aggregate of fees charged pursuant to subsection (d)(2)(B).
23.10 	(g) Subject to adjustment of the dollar amount pursuant to section 332A.51(f), if a 
23.11 	payment to a provider by an individual under this chapter is dishonored, a provider may 
23.12 	impose a reasonable charge on the individual, not to exceed the lesser of $25 and the 
23.13 	amount permitted by law other than this chapter.

23.14 	Sec. 24. [332A.43] VOLUNTARY CONTRIBUTIONS.
23.15 	A provider may not solicit a voluntary contribution from an individual or an 
23.16 	affiliate of the individual for any service provided to the individual. A provider may 
23.17 	accept voluntary contributions from an individual but, until 30 days after completion or 
23.18 	termination of a plan, the aggregate amount of money received from or on behalf of 
23.19 	the individual may not exceed the total amount the provider may charge the individual 
23.20 	under section 332A.42.

23.21 	Sec. 25. [332A.44] VOIDABLE AGREEMENTS.
23.22 	(a) If a provider imposes a fee or other charge or receives money or other payments 
23.23 	not authorized by section 332A.42 or 332A.43, the individual may void the agreement and 
23.24 	recover as provided in section 332A.54.
23.25 	(b) If a provider is not registered as required by this chapter when an individual 
23.26 	assents to an agreement, the agreement is voidable by the individual.
23.27 	(c) If an individual voids an agreement under subsection (b), the provider does not 
23.28 	have a claim against the individual for breach of contract or for restitution.

23.29 	Sec. 26. [332A.45] TERMINATION OF AGREEMENTS.
23.30 	(a) If an individual who has entered into an agreement fails for 60 days to make 
23.31 	payments required by the agreement, a provider may terminate the agreement.
23.32 	(b) If a provider or an individual terminates an agreement, the provider shall 
23.33 	immediately return to the individual:
24.1 	(1) any money of the individual held in trust for the benefit of the individual; and
24.2 	(2) 65 percent of any portion of the setup fee received pursuant to section 
24.3 	332A.42(d)(2) which has not been credited against settlement fees.

24.4 	Sec. 27. [332A.46] PERIODIC REPORTS AND RETENTION OF RECORDS.
24.5 	(a) A provider shall provide the accounting required by subsection (b):
24.6 	(1) upon cancellation or termination of an agreement; and
24.7 	(2) before cancellation or termination of any agreement:
24.8 	(A) at least once each month; and
24.9 	(B) within five business days after a request by an individual, but the provider need 
24.10 	not comply with more than one request in any calendar month.
24.11 	(b) A provider, in a record, shall provide each individual for whom it has established 
24.12 	a plan an accounting of the following information:
24.13 	(1) the amount of money received from the individual since the last report;
24.14 	(2) the amounts and dates of disbursement made on the individual's behalf, or by 
24.15 	the individual upon the direction of the provider, since the last report to each creditor 
24.16 	listed in the plan;
24.17 	(3) the amounts deducted from the amount received from the individual;
24.18 	(4) the amount held in reserve; and
24.19 	(5) if, since the last report, a creditor has agreed to accept as payment in full an 
24.20 	amount less than the principal amount of the debt owed by the individual:
24.21 	(A) the total amount and terms of the settlement;
24.22 	(B) the amount of the debt when the individual assented to the plan;
24.23 	(C) the amount of the debt when the creditor agreed to the settlement; and
24.24 	(D) the calculation of a settlement fee.
24.25 	(c) A provider shall maintain records for each individual for whom it provides 
24.26 	debt-management services for five years after the final payment made by the individual 
24.27 	and produce a copy of them to the individual within a reasonable time after a request for 
24.28 	them. The provider may use electronic or other means of storage of the records.

24.29 	Sec. 28. [332A.47] PROHIBITED ACTS AND PRACTICES.
24.30 	(a) A provider may not, directly or indirectly:
24.31 	(1) misappropriate or misapply money held in trust;
24.32 	(2) settle a debt on behalf of an individual for more than 50 percent of the principal 
24.33 	amount of the debt owed a creditor, unless the individual assents to the settlement after 
24.34 	the creditor has assented;
25.1 	(3) take a power of attorney that authorizes it to settle a debt, unless the power of 
25.2 	attorney expressly limits the provider's authority to settle debts for not more than 50 
25.3 	percent of the principal amount of the debt owed a creditor;
25.4 	(4) exercise or attempt to exercise a power of attorney after an individual has 
25.5 	terminated an agreement;
25.6 	(5) initiate a transfer from an individual's account at a bank or with another person 
25.7 	unless the transfer is:
25.8 	(A) a return of money to the individual; or
25.9 	(B) before termination of an agreement, properly authorized by the agreement and 
25.10 	this chapter, and for:
25.11 	(i) payment to one or more creditors pursuant to an agreement; or
25.12 	(ii) payment of a fee;
25.13 	(6) offer a gift or bonus, premium, reward, or other compensation to an individual 
25.14 	for executing an agreement; 
25.15 	(7) offer, pay, or give a gift or bonus, premium, reward, or other compensation to 
25.16 	a person for referring a prospective customer, if the person making the referral has a 
25.17 	financial interest in the outcome of debt-management services provided to the customer, 
25.18 	unless neither the provider nor the person making the referral communicates to the 
25.19 	prospective customer the identity of the source of the referral; 
25.20 	(8) receive a bonus, commission, or other benefit for referring an individual to 
25.21 	a person;
25.22 	(9) structure a plan in a manner that would result in a negative amortization of any of 
25.23 	an individual's debts, unless a creditor that is owed a negatively amortizing debt agrees to 
25.24 	refund or waive the finance charge upon payment of the principal amount of the debt;
25.25 	(10) compensate its employees on the basis of a formula that incorporates the 
25.26 	number of individuals the employee induces to enter into agreements;
25.27 	(11) settle a debt or lead an individual to believe that a payment to a creditor is in 
25.28 	settlement of a debt to the creditor unless, at the time of settlement, the individual receives 
25.29 	a certification by the creditor that the payment is in full settlement of the debt;
25.30 	(12) make a representation that:
25.31 	(A) the provider will furnish money to pay bills or prevent attachments;
25.32 	(B) payment of a certain amount will permit satisfaction of a certain amount or 
25.33 	range of indebtedness; or
25.34 	(C) participation in a plan will or may prevent litigation, garnishment, attachment, 
25.35 	repossession, foreclosure, eviction, or loss of employment;
26.1 	(13) misrepresent that it is authorized or competent to furnish legal advice or 
26.2 	perform legal services;
26.3 	(14) represent in its agreements, disclosures required by this chapter, advertisements, 
26.4 	or Internet Web site that it is:
26.5 	(A) a not-for-profit entity unless it is organized and properly operating as a 
26.6 	not-for-profit entity under the law of the state in which it was formed; or
26.7 	(B) a tax-exempt entity unless it has received certification of tax-exempt status from 
26.8 	the Internal Revenue Service and is properly operating as a not-for-profit entity under the 
26.9 	law of the state in which it was formed;
26.10 	(15) take a confession of judgment or power of attorney to confess judgment against 
26.11 	an individual; or
26.12 	(16) employ an unfair, unconscionable, or deceptive act or practice, including the 
26.13 	knowing omission of any material information.
26.14 	(b) If a provider furnishes debt-management services to an individual, the provider 
26.15 	may not, directly or indirectly:
26.16 	(1) purchase a debt or obligation of the individual;
26.17 	(2) receive from or on behalf of the individual:
26.18 	(A) a promissory note or other negotiable instrument other than a check or a demand 
26.19 	draft; or
26.20 	(B) a postdated check or demand draft;
26.21 	(3) lend money or provide credit to the individual, except as a deferral of a settlement 
26.22 	fee at no additional expense to the individual;
26.23 	(4) obtain a mortgage or other security interest from any person in connection with 
26.24 	the services provided to the individual;
26.25 	(5) except as permitted by federal law, disclose the identity or identifying 
26.26 	information of the individual or the identity of the individual's creditors, except to:
26.27 	(A) the administrator, upon proper demand;
26.28 	(B) a creditor of the individual, to the extent necessary to secure the cooperation of 
26.29 	the creditor in a plan; or
26.30 	(C) the extent necessary to administer the plan;
26.31 	(6) except as otherwise provided in section 332A.42(f), provide the individual less 
26.32 	than the full benefit of a compromise of a debt arranged by the provider;
26.33 	(7) charge the individual for or provide credit or other insurance, coupons for 
26.34 	goods or services, membership in a club, access to computers or the Internet, or any 
26.35 	other matter not directly related to debt-management services or educational services 
26.36 	concerning personal finance; or
27.1 	(8) furnish legal advice or perform legal services, unless the person furnishing that 
27.2 	advice to or performing those services for the individual is licensed to practice law.
27.3 	(c) This chapter does not authorize any person to engage in the practice of law.
27.4 	(d) A provider may not receive a gift or bonus, premium, reward, or other 
27.5 	compensation, directly or indirectly, for advising, arranging, or assisting an individual in 
27.6 	connection with obtaining, an extension of credit or other service from a lender or service 
27.7 	provider, except for educational or counseling services required in connection with a 
27.8 	government-sponsored program.
27.9 	(e) Unless a person supplies goods, services, or facilities generally and supplies them 
27.10 	to the provider at a cost no greater than the cost the person generally charges to others, a 
27.11 	provider may not purchase goods, services, or facilities from the person if an employee or 
27.12 	a person that the provider should reasonable know is an affiliate of the provider:
27.13 	(1) owns more than ten percent of the person; or
27.14 	(2) is an employee or affiliate of the person.

27.15 	Sec. 29. [332A.48] NOTICE OF LITIGATION.
27.16 	No later than 30 days after a provider has been served with notice of a civil action 
27.17 	for violation of this chapter by or on behalf of an individual who resides in this state at 
27.18 	either the time of an agreement or the time the notice is served, the provider shall notify 
27.19 	the administrator in a record that it has been sued.

27.20 	Sec. 30. [332A.49] ADVERTISING.
27.21 	(a) If the agreements of a provider contemplate that creditors will reduce finance 
27.22 	charges or fees for late payment, default, or delinquency and the provider advertises 
27.23 	debt-management services, it shall disclose, in an easily comprehensible manner, that 
27.24 	using a debt-management plan may make it harder for the individual to obtain credit.
27.25 	(b) If the agreements of a provider contemplate that creditors will settle for less than 
27.26 	the full principal amount of debt and the provider advertises debt-management services, it 
27.27 	shall disclose, in an easily comprehensible manner, the information specified in section 
27.28 	332A.36(d)(3) and (4).

27.29 	Sec. 31. [332A.50] LIABILITY FOR THE CONDUCT OF OTHER PERSONS.
27.30 	If a provider delegates any of its duties or obligations under an agreement or this 
27.31 	chapter to another person, including an independent contractor, the provider is liable 
27.32 	for conduct of the person which, if done by the provider, would violate the agreement 
27.33 	or this chapter.

28.1 	Sec. 32. [332A.51] POWERS OF ADMINISTRATOR.
28.2 	(a) The administrator may act on its own initiative or in response to complaints and 
28.3 	may receive complaints, take action to obtain voluntary compliance with this chapter, refer 
28.4 	cases to the attorney general, and seek or provide remedies as provided in this chapter.
28.5 	(b) The administrator may investigate and examine, in this state or elsewhere, 
28.6 	by subpoena or otherwise, the activities, books, accounts, and records of a person that 
28.7 	provides or offers to provide debt-management services, or a person to which a provider 
28.8 	has delegated its obligations under an agreement or this chapter, to determine compliance 
28.9 	with this chapter. Information that identifies individuals who have agreements with the 
28.10 	provider shall not be disclosed to the public. In connection with the investigation, the 
28.11 	administrator may:
28.12 	(1) charge the person the reasonable expenses necessarily incurred to conduct the 
28.13 	examination;
28.14 	(2) require or permit a person to file a statement under oath as to all the facts and 
28.15 	circumstances of a matter to be investigated; and
28.16 	(3) seek a court order authorizing seizure from a bank at which the person maintains 
28.17 	a trust account required by section 332A.41, any or all money, books, records, accounts, 
28.18 	and other property of the provider that is in the control of the bank and relates to 
28.19 	individuals who reside in this state.
28.20 	(c) The administrator may adopt rules to implement the provisions of this chapter 
28.21 	in accordance with chapter 14.
28.22 	(d) The administrator may enter into cooperative arrangements with any other 
28.23 	federal or state agency having authority over providers and may exchange with any of 
28.24 	those agencies information about a provider, including information obtained during an 
28.25 	examination of the provider.
28.26 	(e) The administrator, by rule, shall establish reasonable fees to be paid by providers 
28.27 	for the expense of administering this chapter.
28.28 	(f) The administrator, by rule, shall adopt dollar amounts instead of those specified 
28.29 	in sections 332A.21, 332A.24, 332A.28, 332A.32, 332A.42, 332A.52, and 332A.54 to 
28.30 	reflect inflation, as measured by the United States Bureau of Labor Statistics Consumer 
28.31 	Price Index for all urban consumers or, if that index is not available, another index adopted 
28.32 	by rule by the administrator. The administrator shall adopt a base year and adjust the 
28.33 	dollar amounts, effective on July 1 of each year, if the change in the index from the base 
28.34 	year, as of December 31 of the preceding year, is at least ten percent. The dollar amount 
28.35 	must be rounded to the nearest $100, except that the amounts in section 332A.42 must 
28.36 	be rounded to the nearest dollar.
29.1 	(g) The administrator shall notify registered providers of any change in dollar 
29.2 	amounts made pursuant to subsection (f) and make that information available to the public.

29.3 	Sec. 33. [332A.52] ADMINISTRATIVE REMEDIES.
29.4 	(a) The administrator may enforce this chapter and rules adopted under this chapter 
29.5 	by taking one or more of the following actions:
29.6 	(1) ordering a provider or a director, employee, or other agent of a provider to cease 
29.7 	and desist from any violations;
29.8 	(2) ordering a provider or a person that has caused a violation to correct the violation, 
29.9 	including making restitution of money or property to a person aggrieved by a violation;
29.10 	(3) subject to adjustment of the dollar amount pursuant to section 332A.51(f), 
29.11 	imposing on a provider or a person that has caused a violation a civil penalty not exceeding 
29.12 	$10,000 for each violation;
29.13 	(4) prosecuting a civil action to:
29.14 	(A) enforce an order;
29.15 	(B) obtain restitution or an injunction or other equitable relief, or both; or
29.16 	(5) intervening in an action brought under section 332A.54.
29.17 	(b) Subject to adjustment of the dollar amount pursuant to section 332A.51(f), if a 
29.18 	person violates or knowingly authorizes, directs, or aids in the violation of a final order 
29.19 	issued under subsection (a)(1) or (2), the administrator may impose a civil penalty not 
29.20 	exceeding $20,000 for each violation.
29.21 	(c) The administrator may maintain an action to enforce this chapter in any county.
29.22 	(d) The administrator may recover the reasonable costs of enforcing this chapter 
29.23 	under subsections (a) through (c), including attorney fees based on the hours reasonably 
29.24 	expended and the hourly rates for attorneys of comparable experience in the community.
29.25 	(e) In determining the amount of a civil penalty to impose under subsection (a) or 
29.26 	(b), the administrator shall consider the seriousness of the violation, the good faith of the 
29.27 	violator, any previous violations by the violator, the deleterious effect of the violation on 
29.28 	the public, the net worth of the violator, and any other factor the administrator considers 
29.29 	relevant to the determination of the civil penalty.

29.30 	Sec. 34. [332A.53] SUSPENSION, REVOCATION, OR NONRENEWAL OF 
29.31 	REGISTRATION.
29.32 	(a) In this section, "insolvent" means:
29.33 	(1) having generally ceased to pay debts in the ordinary course of business other 
29.34 	than as a result of good-faith dispute;
30.1 	(2) being unable to pay debts as they become due; or
30.2 	(3) being insolvent within the meaning of the federal bankruptcy law, United States 
30.3 	Code, title 11, section 101 et seq., as amended.
30.4 	(b) The administrator may suspend, revoke, or deny renewal of a provider's 
30.5 	registration if:
30.6 	(1) a fact or condition exists that, if it had existed when the registrant applied for 
30.7 	registration as a provider, would have been a reason for denying registration;
30.8 	(2) the provider has committed a material violation of this chapter or a rule or order 
30.9 	of the administrator under this chapter;
30.10 	(3) the provider is insolvent;
30.11 	(4) the provider or an employee or affiliate of the provider has refused to permit the 
30.12 	administrator to make an examination authorized by this chapter, failed to comply with 
30.13 	section 332A.51(b)(2) within 15 days after request, or made a material misrepresentation 
30.14 	or omission in complying with section 332A.51(b)(2); or
30.15 	(5) the provider has not responded within a reasonable time and in an appropriate 
30.16 	manner to communications from the administrator.
30.17 	(c) If a provider does not comply with section 332A.41(f) or if the administrator 
30.18 	otherwise finds that the public health or safety or general welfare requires emergency 
30.19 	action, the administrator may order a summary suspension of the provider's registration, 
30.20 	effective on the date specified in the order.
30.21 	(d) If the administrator suspends, revokes, or denies renewal of the registration of 
30.22 	a provider, the administrator may seek a court order authorizing seizure of any or all of 
30.23 	the money in a trust account required by section 332A.41, books, records, accounts, and 
30.24 	other property of the provider which are located in this state.
30.25 	(e) If the administrator suspends or revokes a provider's registration, the provider 
30.26 	may appeal and request a hearing pursuant to [insert the citation to the appropriate section 
30.27 	of the administrative procedure act or other statute governing administrative procedure].

30.28 	Sec. 35. [332A.54] PRIVATE ENFORCEMENT.
30.29 	(a) If an individual voids an agreement pursuant to section 332A.44(b), the 
30.30 	individual may recover in a civil action all money paid or deposited by or on behalf of the 
30.31 	individual pursuant to the agreement, except amounts paid to creditors, in addition to the 
30.32 	recovery under subsection (c)(3) and (4).
30.33 	(b) If an individual voids an agreement pursuant to section 332A.44(a), the 
30.34 	individual may recover in a civil action three times the total amount of the fees, charges, 
31.1 	money, and payments made by the individual to the provider, in addition to the recovery 
31.2 	under subsection (c)(4).
31.3 	(c) Subject to subsection (d), an individual with respect to whom a provider violates 
31.4 	this chapter may recover in a civil action from the provider and any person that caused 
31.5 	the violation:
31.6 	(1) compensatory damages for injury, including noneconomic injury, caused by 
31.7 	the violation;
31.8 	(2) except as otherwise provided in subsection (d) and subject to adjustment 
31.9 	of the dollar amount pursuant to section 332A.51(f), with respect to a violation of 
31.10 	section 332A.36, 332A.38, 332A.39, 332A.40, 332A.41, 332A.42, 332A.43, 332A.46, 
31.11 	or 332A.47(a), (b), or (d), the greater of the amount recoverable under paragraph (1) 
31.12 	or $5,000;
31.13 	(3) punitive damages; and
31.14 	(4) reasonable attorney fees and costs.
31.15 	(d) In a class action, except for a violation of section 332A.47(a)(5), the minimum 
31.16 	damages provided in subsection (c)(2) do not apply.
31.17 	(e) In addition to the remedy available under subsection (c), if a provider violates 
31.18 	an individual's rights under section 332A.39, the individual may recover in a civil action 
31.19 	all money paid or deposited by or on behalf of the individual pursuant to the agreement, 
31.20 	except for amounts paid to creditors.
31.21 	(f) A provider is not liable under this section for a violation of this chapter if the 
31.22 	provider proves that the violation was not intentional and resulted from a good-faith error 
31.23 	notwithstanding the maintenance of procedures reasonably adapted to avoid the error. An 
31.24 	error of legal judgment with respect to a provider's obligations under this chapter is not 
31.25 	a good-faith error. If, in connection with a violation, the provider has received more 
31.26 	money than authorized by an agreement or this chapter, the defense provided by this 
31.27 	subsection is not available unless the provider refunds the excess within two business 
31.28 	days of learning of the violation.
31.29 	(g) The administrator shall assist an individual in enforcing a judgment against the 
31.30 	surety bond or other security provided under section 332A.32 or 332A.33.

31.31 	Sec. 36. [332A.55] VIOLATION OF UNFAIR OR DECEPTIVE PRACTICES 
31.32 	ACT.
31.33 	If an act or practice of a provider violates both this chapter and sections 72A.17 to 
31.34 	72A.32, an individual may not recover under both for the same act or practice.

32.1 	Sec. 37. [332A.56] STATUTE OF LIMITATIONS.
32.2 	(a) An action or proceeding brought pursuant to section 332A.52(a), (b), or (c) must 
32.3 	be commenced within four years after the conduct that is the basis of the administrator's 
32.4 	complaint.
32.5 	(b) An action brought pursuant to section 332A.54 must be commenced within two 
32.6 	years after the latest of:
32.7 	(1) the individual's last transmission of money to a provider;
32.8 	(2) the individual's last transmission of money to a creditor at the direction of the 
32.9 	provider;
32.10 	(3) the provider's last disbursement to a creditor of the individual;
32.11 	(4) the provider's last accounting to the individual pursuant to section 332A.46(a);
32.12 	(5) the date on which the individual discovered or reasonably should have discovered 
32.13 	the facts giving rise to the individual's claim; or
32.14 	(6) termination of actions or proceedings by the administrator with respect to a 
32.15 	violation of this chapter.
32.16 	(c) The period prescribed in subsection (b)(5) is tolled during any period 
32.17 	during which the provider or, if different, the defendant has materially and willfully 
32.18 	misrepresented information required by this chapter to be disclosed to the individual, if 
32.19 	the information so misrepresented is material to the establishment of the liability of the 
32.20 	defendant under this chapter.

32.21 	Sec. 38. [332A.57] UNIFORMITY OF APPLICATION AND CONSTRUCTION.
32.22 	In applying and construing this Uniform Act, consideration must be given to the 
32.23 	need to promote uniformity of the law with respect to its subject matter among states 
32.24 	that enact it.

32.25 	Sec. 39. [332A.58] RELATION TO ELECTRONIC SIGNATURES IN GLOBAL 
32.26 	AND NATIONAL COMMERCE ACT.
32.27 	This chapter modifies, limits, and supersedes the federal Electronic Signatures in 
32.28 	Global and National Commerce Act (United States Code, title 15, section 7001 et seq.) 
32.29 	but does not modify, limit, or supersede section 101(c) of that act (United States Code, 
32.30 	title 15, section 7001(c)) or authorize electronic delivery of any of the notices described in 
32.31 	section 103(b) of that act (United States Code, title 15, section 7003(b)).

32.32 	Sec. 40. [332A.59] TRANSITIONAL PROVISIONS; APPLICATION TO 
32.33 	EXISTING TRANSACTIONS.
33.1 	Transactions entered into before this chapter takes effect and the rights, duties, and 
33.2 	interests resulting from them may be completed, terminated, or enforced as required 
33.3 	or permitted by a law amended, repealed, or modified by this chapter as though the 
33.4 	amendment, repeal, or modification had not occurred.

33.5 	Sec. 41. [332A.60] SEVERABILITY.
33.6 	If any provision of this chapter or its application to any person or circumstance is 
33.7 	held invalid, the invalidity does not affect other provisions or applications of this chapter 
33.8 	that can be given effect without the invalid provision or application, and to this end the 
33.9 	provisions of this chapter are severable.

33.10 	Sec. 42.  REPEALER.
 33.11 	Minnesota Statutes 2008, sections 332A.02; 332A.03; 332A.04; 332A.05; 332A.06; 
33.12 	332A.07; 332A.08; 332A.09; 332A.10; 332A.11; 332A.12; 332A.13; 332A.14; 332A.16; 
33.13 	332A.17; 332A.18; and 332A.19, are repealed.

33.14 	Sec. 43. EFFECTIVE DATE.
 33.15 	This chapter takes effect 12 months after final enactment.