Subdivision 1. Form.
Application for a license to operate a debt prorating service in this
state shall be made in writing to the commissioner, under oath, in the form prescribed by the
commissioner, and shall contain the full name and address of the applicant, the business to be
conducted, and, if the applicant is a partnership or association, of every member thereof and, if a
corporation, of each officer, director and shareholder owning more than five percent of outstanding
common stock thereof and such other information and material as the commissioner may require.
Subd. 2. License for each location.
Each person operating a debt prorating service shall
obtain a license for each location and place of business, including each branch office. Such
person shall submit a separate application for each place of business. The full license fee shall be
payable only for one such place of business. For each additional place of business the license fee
shall be $100.
Subd. 3. Fees.
Each applicant, at the time of making such application, shall pay to the
commissioner the sum of $100 as a fee for investigation of the applicant, and the additional sum of
$250 as a license fee. If the application is denied, said license fee shall be returned to the applicant.
Subd. 4. Bond.
Every applicant shall submit to the commissioner at the time of the
application for a license, a surety bond in which the applicant shall be the obligor, in a sum to be
determined by the commissioner but not less than $5,000, and in which an insurance company,
which is duly authorized by the state of Minnesota to transact the business of fidelity and surety
insurance, shall be a surety; provided, however, the commissioner may accept a deposit in cash,
or securities such as may legally be purchased by savings banks or for trust funds of an aggregate
market value equal to the bond requirement, in lieu of the surety bond, such cash or securities to
be deposited with the commissioner of finance. The commissioner may also require a fidelity
bond in an appropriate amount covering employees of any applicant. Each branch office or
additional place of business of an applicant shall be bonded as provided herein. In determining
the bond amount necessary for the maintenance of any office be it surety, fidelity or both the
commissioner shall consider the financial responsibility, experience, character and general fitness
of the agency and its operators and owners; the volume of business handled or proposed to be
handled; the location of the office and the geographical area served or proposed to be served;
and such other information the commissioner may deem pertinent based upon past performance,
previous examinations, annual reports and manner of business conducted in other states.
Subd. 5. Condition of bond.
The applicant shall be the obligor. The bond shall run to the
state of Minnesota for the use of the state and of any person or persons who may have a cause of
action against the obligor arising out of the obligor's activities as a debt prorater. Such bond shall
be conditioned that said obligor will not commit any fraudulent act and will faithfully conform to
and abide by the provisions of sections
and of all rules lawfully made by the
commissioner hereunder and pay to the state and to any such person or persons any and all money
that may become due or owing to the state or to such person or persons from said obligor under
and by virtue of the provisions of sections
Subd. 6. Right of action on bond.
If the licensee has failed to account to a debtor or
distribute to the debtor's creditors such amounts as are required by sections
and the contract between the debtor and licensee, the debtor or the debtor's legal representative
or receiver, the commissioner or the attorney general, shall have, in addition to all other legal
remedies, a right of action in the name of the debtor on the bond or the security given pursuant to
the provisions of this section, for loss suffered by the debtor, not exceeding the face of the bond or
security, and without the necessity of joining the licensee in such suit or action.
History: 1969 c 1120 s 4; 1971 c 441 s 1; 1985 c 248 s 70; 1986 c 444; 1992 c 564 art 4 s
15; 1999 c 151 s 43,44; 2003 c 112 art 2 s 50