Bill Text: IL HB1289 | 2025-2026 | 104th General Assembly | Introduced

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Bill Title: Creates the Debt Resolution Services Act. Provides that no person shall provide or offer to provide debt resolution services without a debt resolution services license. Defines "debt resolution services" as a program or service represented, directly or by implication, to renegotiate, settle, or in any way alter the terms of payment or other terms of the debt between a consumer and one or more unsecured creditors. Sets forth requirements for a debt resolution services license. Sets forth the process for obtaining a debt resolution services license. Provides that specified persons are exempt under the Act. Provides the prerequisites and permitted practices for providing debt resolution services. Provides the requirements for a contract between a licensee and a consumer for debt resolution services. Provides that a consumer may terminate a contract to provide debt resolution services at any time without any penalty. Provides that a licensee may terminate a contract to provide debt resolution services if specified conditions are satisfied. Includes provisions concerning the powers of the Department of Financial and Professional Regulation; prohibited activities under the Act, including prohibitions against false or misleading advertising; annual reports filed by a licensee; fees for debt resolution services; information a licensee must provide to a consumer; records a licensee is required to keep; penalties for violating the Act; and transactions entered into before the effective date of the Act. Repeals the Debt Settlement Consumer Protection Act. Amends various Acts to replace references to the Debt Settlement Consumer Protection Act to the Debt Resolution Services Act. Effective one year after becoming law except that certain provisions concerning rulemaking are effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2025-01-13 - Filed with the Clerk by Rep. Dagmara Avelar [HB1289 Detail]

Download: Illinois-2025-HB1289-Introduced.html

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104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1289 Introduced , by Rep. Dagmara Avelar SYNOPSIS AS INTRODUCED:
New Act
30 ILCS 105/6z-26
20 ILCS 1205/6
205 ILCS 665/2 from Ch. 17, par. 5302
225 ILCS 429/Act rep.
815 ILCS 505/2JJJ
Creates the Debt Resolution Services Act. Provides that no person shall provide or offer to provide debt resolution services without a debt resolution services license. Defines "debt resolution services" as a program or service represented, directly or by implication, to renegotiate, settle, or in any way alter the terms of payment or other terms of the debt between a consumer and one or more unsecured creditors. Sets forth requirements for a debt resolution services license. Sets forth the process for obtaining a debt resolution services license. Provides that specified persons are exempt under the Act. Provides the prerequisites and permitted practices for providing debt resolution services. Provides the requirements for a contract between a licensee and a consumer for debt resolution services. Provides that a consumer may terminate a contract to provide debt resolution services at any time without any penalty. Provides that a licensee may terminate a contract to provide debt resolution services if specified conditions are satisfied. Includes provisions concerning the powers of the Department of Financial and Professional Regulation; prohibited activities under the Act, including prohibitions against false or misleading advertising; annual reports filed by a licensee; fees for debt resolution services; information a licensee must provide to a consumer; records a licensee is required to keep; penalties for violating the Act; and transactions entered into before the effective date of the Act. Repeals the Debt Settlement Consumer Protection Act. Amends various Acts to replace references to the Debt Settlement Consumer Protection Act to the Debt Resolution Services Act. Effective one year after becoming law except that certain provisions concerning rulemaking are effective immediately.
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A BILL FOR
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AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be cited as the Debt
Resolution Services Act.
Section 2. Definitions. As used in this Act:
"Agreement" means a contract between a licensee and a
consumer that meets the requirements of Section 9.
"Bank" means a financial institution, including a
commercial bank, savings bank, savings and loan association,
credit union, mortgage bank, or trust company, engaged in the
business of banking, that is chartered under federal or State
law and regulated by a federal or State banking regulatory
agency.
"Business address" means the designation of the physical
location of a business, including the name and number of a
street.
"Business day" means a calendar day, except for Saturdays,
Sundays, and legal holidays.
"Consumer" means an individual who has executed an
agreement with a licensee.
"Creditor" means a person that has extended credit to a
consumer, including any agent or assignee of the person.

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"Debt resolution services" means any program or service
represented, directly or by implication, to renegotiate,
settle, or in any way alter the terms of payment or other terms
of the debt between a consumer and one or more unsecured
creditors, including, but not limited to, a reduction in the
balance, interest rate, or fees owed by a consumer to an
unsecured creditor.
"Dedicated account" means an account that meets the
criteria set forth in paragraphs (1), (2), (3), (4), and (5) of
subsection (a) of Section 9.
"Dedicated account service provider" means an entity that
facilitates transactions authorized by the consumer under the
terms of 16 CFR 310.4(a)(5)(ii).
"Department" means the Department of Financial and
Professional Regulation.
"Licensee" means a provider of debt resolution services
that possesses a valid license issued pursuant to this Act.
"Person" means any individual, group, unincorporated
association, limited or general partnership, corporation, or
other business entity.
"State" means any state of the United States, the District
of Columbia, Puerto Rico, the Northern Mariana Islands, and
any other territory, possession, or protectorate of the United
States.
Section 3. License required.

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(a) No person shall provide or offer to provide debt
resolution services in this State unless the person first
obtains a debt resolution services license from the
Department.
(b) A licensee shall obtain a license for the licensee's
primary business address.
(c) A license may not be transferred or assigned.
(d) A licensee shall file a surety bond in favor of this
State in an amount and form that the Department determines
before the licensee may provide or offer to provide debt
resolution services in this State, but in no event shall the
amount of the bond be greater than $50,000.
(e) A licensee shall not provide debt resolution services
in this State under a business name other than the business
name that is listed on the licensee's license; however, a
licensee may do business under a fictitious business name, if
the licensee registers the fictitious business name with the
Secretary of State and provides evidence of the registration
to the Department.
(f) The Department may adopt rules for the licensing of
licensees and may require a reasonable license and
investigation fee in connection with the issuance or renewal
of any license required by this Act.
Section 4. Exempt persons.
(a) The following persons are exempt from this Act:

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(1) Persons organized under Section 501(c) or 501(q)
of the Internal Revenue Code.
(2) Judicial officers, including individuals acting
under the direction of a court.
(3) Banks and their agents and their employees.
(4) Attorneys licensed to practice law in this State
who provide debt resolution services within an
attorney-client relationship.
(5) Creditors or their employees who negotiate debt
resolutions with consumers or with licensees acting on
behalf of consumers.
(6) Assignees for the benefit of creditors.
(7) Officers or employees of the United States or any
state who perform debt resolution services on behalf of
the federal government, a state, a municipality, or a
state agency, and who receive compensation solely from the
governmental entity.
(8) Certified public accountants licensed in this
State who provide debt resolution services within an
accountant-client relationship.
(9) Dedicated account service providers that do not
otherwise provide debt resolution services for consumers.
(10) Persons, to the extent that the person provides
or agrees to provide debt resolution services to an
individual who the person has no reason to know resides in
this State at the time the person agrees to provide the

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services.
(b) The following persons are exempt from the licensing
requirement established in Section 3:
(1) A licensee's employees.
(2) Persons who market on behalf of licensees and do
not otherwise provide debt resolution services.
Section 5. Application for licensure.
(a) The application for a license and the application for
a license renewal shall be in a form prescribed by the
Department, signed under oath, and shall contain such
information as the Department reasonably requires. A license
to provide debt resolution services is for a period of 2 years
from the date of issuance.
(b) The following items are required in any application
for a license under this Act:
(1) Proof of compliance with all relevant requirements
for an entity to engage in business in this State.
(2) The applicant's name, principal business address,
and telephone number; all business addresses in this
State; the principal email address for the business; and
the principal website address to be used for the business.
(3) The name and business address of each executive
officer and member of the board of directors, or
equivalent leadership structure, of the applicant.
(4) A statement describing, to the extent it is known

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or should be known by the applicant, any material civil or
criminal judgment in any jurisdiction, or any enforcement
action against the applicant, or any of its executive
officers or members of its board of directors, or
equivalent leadership structure, by any local, state, or
federal governmental agency, in each case relating to debt
adjusting, debt pooling, prorating, activity as a credit
services organization, unfair and deceptive trade
practices, false advertising, consumer deception law or
regulation, or any other similar law or regulation.
(5) A copy of each form of agreement and the schedule
of fees and charges that the applicant will use with
consumers who reside in this State.
(6) Income statements and balance sheets from the
applicant for the 2 fiscal years preceding the date of the
application. Notwithstanding any other requirement in this
Act or elsewhere, material submitted under this paragraph
shall be held confidential by the Department.
(c) In connection with any application for license
renewal, the licensee shall provide access to the licensee's
books and records with respect to consumers in this State that
are being or have been serviced by the licensee.
(d) The Department may participate in a multistate
licensing system for the sharing of regulatory information and
for the licensing and application, by electronic or other
means, of persons engaged in the business of debt resolution

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services. The Department may establish requirements for
participation by an applicant in a multistate licensing
system, which may vary from the provisions in this Act. The
applicant shall pay directly to a multistate licensing system
any additional fee relating to participation in a multistate
licensing system.
(e)(1) The Department may require each applicant applying
for initial licensure under this Act to submit a full set of
fingerprints of each of the applicant's executive officers in
order for the Department to obtain and receive national
criminal history records from the Federal Bureau of
Investigation criminal justice information services division.
Unless the Department, as authorized by paragraph (2),
contracts, or makes use of any existing contract, the
Department may submit each executive officer's fingerprints
and the fee required to perform the criminal history record
checks to the Illinois State Police and the Federal Bureau of
Investigation for state and national criminal history record
checks. The Department may require any fingerprints submitted
pursuant to this subsection be provided in an electronic
format.
(2) The Department may contract, or make use of any
existing contract with this State, for the collection and
transmission of fingerprints authorized under this Section. If
the Department contracts, or makes use of an existing
contract, the Department may order the applicant to pay the

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fee for collecting and transmitting fingerprints to the
contractor. The Department may agree to a reasonable
fingerprinting fee to be charged by the contractor to the
applicant.
(3) The Department shall treat and maintain any executive
officer's fingerprints and any criminal history record
information obtained under this Section as confidential and
limit the use of records solely to the purposes authorized in
this Section. The fingerprints and any criminal history record
information are not subject to subpoena, other than a subpoena
issued in a criminal action or investigation, and are
confidential by law and privileged, and are not subject to
discovery or admissible in evidence in any civil action.
(4) The Department shall refuse to issue an initial
license to an applicant who does not provide fingerprints in
compliance with this subsection.
(f) An applicant or licensee shall notify the Department
within 30 days after a material change in any of the
information submitted in connection with any application or
renewal application for a license under this Act, including,
but not limited to:
(1) a change in the licensee's principal place of
business;
(2) a merger or dissolution related to the license; or
(3) a licensee pleading guilty to or being convicted
of any felony in a court of competent jurisdiction.

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Section 6. Licensure issuance or denial.
(a) The Department may deny a license if:
(1) the applicant does not satisfy the criteria set
forth in Section 5;
(2) the application contains information that is
materially erroneous or materially incomplete;
(3) the applicant fails to provide in a timely manner
such information as the Department reasonably requests;
(4) an executive officer or member of the board of
directors, or equivalent leadership structure, of the
applicant has been convicted of or pled nolo contendere
to:
(A) a felony; or
(B) an act involving fraud, deceit, or dishonesty;
or
(5) an executive officer or member of the board of
directors, or equivalent leadership structure, of the
applicant has had a professional license revoked,
suspended, or subjected to enforcement action in any
state, and the license has not been reinstated.
(b) Not later than the 20th day after a license
application denial, the Department shall provide to the
applicant a written decision and findings containing the
reasons supporting a license denial.
(c) A license application denial is a final administrative

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decision under the Administrative Review Law.
Section 7. Licensure suspension, revocation, or denial of
renewal.
(a) The Department may suspend, revoke, or deny renewal of
a license if:
(1) the Department asserts that the licensee has
materially violated this Act or any rule adopted under
this Act or any other law applicable to the conduct of the
licensee's business and the licensee has failed to cure
the violation after notice and a reasonable opportunity to
cure the violation;
(2) a fact or condition exists that, if it had existed
when the licensee applied for a license, would have
warranted the Department refusing to issue the license;
(3) the licensee does not satisfy the criteria for
licensure set out in Section 5;
(4) the licensee has refused to permit the Department
to examine the licensee's books and records, failed to
comply with Section 12, or made a material
misrepresentation or omission in complying with Section
12; or
(5) the licensee has not responded within a reasonable
time and in an appropriate manner to the Department's
communications.
(b) If the Department suspends, revokes, or denies renewal

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of a license, the Department may require the licensee to make
available the licensee's books and records with respect to any
consumers in this State that are being or have been serviced by
the licensee.
(c) Except as provided in Section 8, a licensee shall
receive notice and a hearing before the Department revokes or
suspends a license.
(d) A licensee may deliver a written notice to the
Department to surrender the licensee's license. However, if a
licensee surrenders the licensee's license, the licensee's
civil or criminal liability for acts committed before the
surrender is not affected.
(e) Upon submission of a renewal application for a license
and until a renewal application is approved or denied, the
licensee may continue to provide or offer to provide debt
resolution services, but a suspension or denial of a license
terminates any right to provide or offer to provide debt
resolution services in this State unless continuation is
approved by the Department.
Section 8. Powers of the Department.
(a) The Illinois Administrative Procedures Act and the
Administrative Review Law govern all matters and procedures
respecting the hearing and judicial review of any violation or
contested case arising under this Act.
(b) If the Department finds that a delay in issuing an

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order under subsection (a) will irreparably harm the public
interest, the Department may summarily suspend the license
immediately.
(c) Any order issued under this Section is a final
administrative decision under the Administrative Review Law.
(d) The Department may investigate the books, accounts,
records, and files of a licensee or any other person that the
Department has reason to believe is providing or offering to
provide debt resolution services in this State.
Section 9. Prerequisites and permitted practices for
providing debt resolution services.
(a) A licensee may request or require a consumer, as a
condition to the provision of debt resolution services, to
establish and place funds into a dedicated account
administered by a dedicated account service provider, if:
(1) the funds are held in an FDIC-insured bank;
(2) the consumer owns the funds held in the account,
including all accrued interest on the account, if any;
(3) the dedicated account service provider is not
owned or controlled by, or affiliated with, the debt
resolution services provider. For purposes of this
paragraph, (i) "affiliated with" means a dedicated account
service provider that controls, is controlled by, or is
under common control with a licensee, and (ii) "control"
means the direct or indirect possession of the power to

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direct or cause the direction of the management of a
licensee, whether by contract or through ownership of more
than 20% of the voting securities of the licensee;
(4) the dedicated account service provider does not
give or accept any money or other compensation in exchange
for referrals of business involving the debt resolution
services;
(5) the consumer may terminate the debt resolution
services at any time without penalty by giving notice as
required in subsection (a) of Section 10, and thereafter,
the licensee shall notify the dedicated account service
provider of the consumer's termination within 5 business
days of the consumer's notice; and
(6) the agreement discloses each of the criteria set
forth in the preceding paragraphs.
(b) A licensee shall, at the time an agreement is executed
by a consumer, or as shortly thereafter as practical,
distribute or otherwise make available to the consumer a copy
of the executed agreement. For purposes of this Act,
electronic distribution of an executed agreement is permitted
if the consumer agrees.
(c) The agreement must disclose:
(1) the services that the licensee will perform;
(2) the methodology that the licensee will use to
calculate fees to be charged for debt resolution services
and, if reasonably available at the time the agreement is

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executed, the fees that the licensee will charge;
(3) the amount of time estimated on a good-faith basis
to be necessary to achieve the resolution of all enrolled
debts, and to the extent that the service may include a
resolution offer to any of the consumer's creditors, the
time estimated on a good-faith basis when the debt
resolution services provider will make a bona fide
resolution offer to each of them;
(4) to the extent that the debt resolution services
may include a resolution offer to any of the consumer's
creditors, the amount of money or the percentage of each
outstanding debt that the consumer must accumulate before
the debt resolution services provider will make a bona
fide resolution offer to each of them;
(5) that debt resolution services may not be suitable
for all individuals;
(6) to the extent that any aspect of the debt
resolution services relies upon or results in the
consumer's failure to make timely payments to creditors,
that the failure to pay one's debts will likely adversely
affect the consumer's creditworthiness, may result in the
consumer being subject to collections efforts, including
lawsuits by creditors, and may increase the amount of
money the consumer owes due to the accrual of fees and
interest;
(7) that, unless the consumer is insolvent, if a

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creditor resolves a debt for less than its full amount,
the resolution may result in the creation of taxable
income to the consumer, even though the consumer does not
receive any money;
(8) that specific results cannot be predicted or
guaranteed and the licensee cannot require a creditor to
negotiate or resolve a debt;
(9) that debt resolution services programs require
that individuals meet regular savings goals in order to
enable resolutions;
(10) that the licensee does not provide tax,
accounting, or legal advice to individuals, unless the
licensee is licensed in this State to provide such advice;
(11) that the licensee is the consumer's advocate and
does not receive compensation of any sort from creditors
for providing debt resolution services to the consumer;
(12) that the licensee does not make monthly or other
payments to the consumer's creditors;
(13) the list of debts that the agreement covers; and
(14) that, if applicable, the consumer's rights are
subject to mandatory arbitration of any and all disputes
with the debt resolution services provider.
(d) A licensee shall maintain a toll-free
telecommunications system, staffed at a level that has
adequate capacity to accept requests from the reasonably
anticipated volume of consumers contacting the licensee during

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ordinary business hours.
(e) A licensee may extend credit to a consumer in the form
of a deferral of some or all of the licensee's fee for
resolving the consumer's debts, at no additional expense to
the consumer. A licensee may assist in arranging credit to the
consumer if such credit is extended to the consumer by or
through a person that is either separately licensed or
authorized to perform lending in this State or exempt from
such licensure.
Section 10. Consumer's right to terminate agreements.
(a) A consumer may terminate an agreement at any time
without penalty by notifying the licensee electronically, in
writing, or telephonically on a recorded line.
(b) Upon receipt of a consumer's notice of termination, a
licensee shall, as soon as possible but in all instances
within 2 business days, advise the consumer of the effect, if
any, a termination of the consumer's debt resolution services
program would have on previously negotiated installment
resolution agreements and pending resolution negotiations. Not
later than 5 business days following the delivery of such
advice, and absent further instruction from the consumer, a
licensee shall notify the dedicated account service provider
of the consumer's termination and request that the dedicated
account service provider communicate with the consumer
regarding disposition of all funds held in the dedicated

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account.
(c) Notwithstanding the consumer's right to terminate as
set forth in subsection (a), the licensee is entitled to
recover all fees earned prior to the receipt of any
termination notice, provided that the fee is requested or
received in compliance with Section 13.
Section 11. Licensee's right to terminate agreements. If a
consumer fails to honor the consumer's contractual obligations
on or before the 60th day after the consumer was required to
perform them, then the licensee may terminate its agreement
with the consumer electronically or in writing. If the
licensee terminates the agreement as permitted in this
Section, the consumer will not owe any further payment to the
licensee as of the date the licensee terminates the agreement,
other than for fees previously earned by the licensee.
Notwithstanding this Section, if a consumer refuses to pay any
fee to a licensee after the payment has been earned by the
licensee, then the licensee may, upon proper notice to the
consumer either electronically or in writing, terminate the
licensee's agreement with the consumer immediately.
Section 12. Annual reports. A licensee shall file with the
Department an annual report in writing, under oath, that
includes the following information for the calendar year
reporting period: total number of active consumers in this

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State, total number of enrolled consumers in this State, and
total fees collected in this State. If a licensee neglects to
file an annual report or fails to amend the same on or before
the 30th day after the Department provides notice to the
licensee, then the Department may assess civil penalties and
suspend, revoke, or refuse to renew any license under this
Act.
Section 13. Fees for debt resolution services.
(a) A licensee shall not impose, directly or indirectly, a
fee or other charge on a consumer or receive payment from or on
behalf of a consumer for performing debt resolution services
except as provided in this Section.
(b) A licensee may not request or receive payment of any
fee or consideration for any debt resolution services until
and unless:
(1) the licensee has renegotiated, resolved, reduced,
or otherwise altered the terms of at least one debt
pursuant to a resolution agreement or other such valid
contractual agreement executed by the consumer and the
creditor;
(2) the consumer has made at least one payment
pursuant to that resolution agreement or other valid
contractual agreement between the consumer and the
creditor; and
(3) to the extent that debts enrolled in a service are

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renegotiated, resolved, reduced, or otherwise altered
individually, the fee or consideration either: (i) bears
the same proportional relationship to the total fee for
renegotiating, resolving, reducing, or altering the terms
of the entire debt balance as the individual debt amount
bears to the entire debt amount. The individual debt
amount and the entire debt amount are those owed at the
time the debt was enrolled in the service; or (ii) is a
percentage of the amount saved as a result of the
renegotiation, resolution, reduction, or alteration. The
percentage charged cannot change from one individual debt
to another. The amount saved is the difference between the
amount owed at the time the debt was enrolled in the
service and the amount actually paid to satisfy the debt.
(c) A licensee shall not impose charges or receive payment
for debt resolution services until the licensee and the
consumer have signed an agreement that complies with Section
9.
(d) Any fee or other charge imposed by or on behalf of a
dedicated account service provider in connection with the
administration of a dedicated account shall not be considered
a fee or other charge imposed for performing debt resolution
services for purposes of this Act.
(e) Any fee or other charge imposed by or on behalf of a
third-party legal service provider shall not be considered a
fee or other charge imposed by a licensee for performing debt

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resolution services for purposes of this Act.
Section 14. Prohibitions.
(a) A licensee, a person who markets debt resolution
services on behalf of a licensee, or a person described in
paragraph (2) of subsection (b) of Section 4 shall not:
(1) take or exercise a power of attorney that
authorizes the licensee to resolve a debt. For purposes of
this paragraph, "resolve" means entering into a binding
agreement to discharge in full a debt in exchange for a
payment of a sum certain of money;
(2) send to creditors cease and desist notices, or
require consumers to notify creditors of changes of
address or phone number, meant to divert communication
from the creditor to the debt resolution services provider
rather than the consumer;
(3) exercise or attempt to exercise any authority of
the consumer after a licensee has received notice under
Section 10 that the consumer has terminated the consumer's
agreement with the licensee;
(4) initiate, or request that a dedicated account
service provider initiate, a transfer from a consumer's
bank account unless the transfer is:
(A) a return of money to the consumer;
(B) before any termination of an agreement and
properly authorized by the agreement and this Act for

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payment of a fee; or
(C) at the express direction of the consumer, to a
consumer's creditor to fund a negotiated resolution
with that creditor;
(5) receive consumer funds or control consumer funds,
other than to receive funds in payment of fees earned by
the debt resolution services provider;
(6) resolve a debt or lead a consumer to believe that a
payment to a creditor is in resolution of a debt to the
creditor unless, at the time of resolution, the creditor
confirms that the payment is in full resolution of the
debt or is part of a payment plan that, upon completion,
will be in full resolution of the debt;
(7) make any representation that:
(A) the licensee will furnish money to pay bills
or prevent attachments; or
(B) participation in a program will prevent
litigation, garnishment, attachment, repossession,
foreclosure, eviction, or loss of employment;
(8) misrepresent that the licensee is able to furnish
legal advice or perform legal services;
(9) misrepresent, directly or by implication, any
material aspect of any debt resolution services program,
including, but not limited to, the amount of money or the
percentage of the debt amount that a consumer may save by
using such service; the amount of time necessary to

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achieve the represented results; the amount of money or
the percentage of each outstanding debt that the consumer
must accumulate before the provider of the debt resolution
services will initiate attempts with the consumer's
creditors or make a bona fide offer to negotiate, resolve,
or modify the terms of the consumer's debt; the effect of
the service on a consumer's creditworthiness; the effect
of the service on collection efforts of the consumer's
creditors; the percentage or number of consumers who
attain the represented results; and whether debt
resolution services are offered or provided by a nonprofit
entity;
(10) take a confession of judgment or power of
attorney to confess judgment against a consumer;
(11) purchase a debt or obligation of the consumer, or
obtain a mortgage or other security interest from any
person in connection with the services provided to the
consumer;
(12) receive from or on behalf of a consumer a
promissory note or other negotiable instrument other than
a check or a demand draft or a post-dated check or demand
draft; or
(13) except as permitted by federal law or by order of
a court of competent jurisdiction, disclose the identity
or identifying information of a consumer or the identity
of the consumer's creditors, except to the Department,

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upon proper demand, or to the extent necessary or
appropriate to administer the program, including, but not
limited to, a dedicated account service provider or to a
creditor of the consumer.
(b) An agreement must not:
(1) provide for the application of the law of any
jurisdiction other than the United States and this State;
(2) except as otherwise permitted by the laws of this
State and the Federal Arbitration Act (9 U.S.C. 1 et
seq.), contain a provision that restricts an individual's
remedies under this Act or any other law of this State; or
(3) contain a provision that limits or releases the
liability of any person for not performing the agreement
or for violating this Act.
Section 15. Information requirements.
(a) A licensee shall distribute or arrange to be
distributed a statement of accounting to a consumer:
(1) while a debt resolution services agreement is in
effect:
(A) at least once per month; and
(B) on or before the 5th business day after a
consumer requests a statement of accounting from a
licensee. However, this Act does not require a
licensee to provide more than one statement of
accounting per month per consumer in response to the

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consumer's request; and
(2) within 5 business days from the date on which a
consumer or a licensee terminates an agreement.
(b) A statement of accounting shall contain the following
information to the extent applicable:
(1) The amount of money that the consumer has
deposited into the consumer's Dedicated Account, and all
withdrawals therefrom, from initiation of the consumer's
debt resolution services program.
(2) The amounts, dates, and creditors associated with
each resolution obtained by the licensee on behalf of the
consumer.
(3) The fees that the licensee has charged to and
collected from the consumer in connection with each of the
consumer's resolutions.
(4) The amount of money that the consumer holds in the
consumer's Dedicated Account.
(5) With respect to each resolution obtained by the
licensee for the consumer:
(A) the total amount of money that the consumer
paid to the creditor in full discharge or satisfaction
of the consumer's debt;
(B) the amount of the debt at the time the licensee
and the consumer entered into the agreement;
(C) the amount of the debt at the time the creditor
agreed to resolve the debt; and

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(D) the amount of compensation that the licensee
received or will receive to resolve the debt.
(c) Notwithstanding the requirements set forth in
paragraphs (1) and (2) of subsection (a), a licensee that
enables, or arranges to enable, 24 hours per day, 7 days per
week, electronic access by a consumer to all of the consumer's
deposit account transaction information, including all deposit
and withdrawal activity, and electronic access by a consumer
to account activity, including, but not limited to, resolution
information, account status, resolution dates, resolution
amounts, and fees paid, is deemed to have satisfied the
content requirements in subsection (b) and the distribution
requirements in subsection (a).
Section 16. Prohibition on false and misleading
advertising.
(a) A licensee shall not, directly or through a person who
markets debt resolution services on behalf of a licensee or a
person described in paragraph (2) of subsection (b) of Section
4, advertise, announce, broadcast, display, distribute, print,
publish, televise, or permit any other person to advertise,
announce, broadcast, display, distribute, print, publish, or
televise on the licensee's behalf a statement or
representation related to debt resolution services that is
deceptive, false, or misleading.
(b) A licensee shall not directly or indirectly provide

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anything of value in exchange for favorable treatment in
reviews or favorable placement on rankings.
(c) Neither a licensee nor any affiliate of a licensee
shall directly or indirectly own or operate a website or other
public-facing resource presenting rankings or consumer reviews
of the licensee.
(d) A licensee shall not make any statement or take any
action that is likely to mislead consumers regarding whether
reviews the licensee uses to advertise its business accurately
reflect all reviews consumers have submitted to the licensee.
(e) A licensee shall comply with 16 CFR Part 255 and with
CFPB Bulletin 2022-05: Unfair and Deceptive Acts or Practices
That Impede Consumer Reviews.
Section 17. Records.
(a) At the time of providing to a consumer any materials or
agreements required by this Act, a licensee shall inform the
consumer that upon electronic, telephonic, or written request,
the licensee shall send the consumer a copy of the materials
and shall comply with a request as provided in subsection (b).
(b) If a consumer submits a request to a licensee, before
the expiration of 90 days after a program is completed or
terminated, to send a copy of the materials required by this
Act, the licensee shall send them to the consumer at no charge
within 5 business days after the request, but the licensee is
not required to comply with a request more than once per

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calendar month or if it reasonably believes the request is
made for purposes of harassment. If a request is made more than
90 days and less than 2 years after a program is completed or
terminated, the licensee must send within a reasonable time a
copy of the materials requested. The licensee is not required
to comply with any request from a consumer made more than the
later of (i) 2 years after a program is completed or terminated
or (ii) the expiration of the statute of limitations governing
contracts in this State.
(c) A licensee that maintains a website shall disclose on
the home page or on a page that is clearly and conspicuously
connected to the home page by a link that clearly reveals its
contents:
(1) the licensee's name and all names under which the
licensee does business in this State; and
(2) the licensee's principal business address,
telephone number, and email address, if any.
(d) Any licensee shall keep, for a period of 2 years from
the date the record is produced, the following records:
(1) All substantially different advertising,
brochures, telemarketing scripts, promotional materials,
and supportive data.
(2) The name and last known address of each consumer,
the goods or services purchased, the date such goods or
services were first provided or the consumer signed an
agreement for the provision of goods or services, and the

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amount paid by the consumer for the goods or services.
(3) The name, any fictitious name used, the last known
home address and telephone number, and the job title for
all current and former employees directly involved in
sales or solicitations; however, if the licensee permits
fictitious names to be used by employees, each fictitious
name must be traceable to only one specific employee.
(e) In addition to the records required by subsection (d),
the licensee must keep a copy of each signed agreement with any
consumer for not less than 5 years from the date that the
consumer either graduates or terminates the debt resolution
services program.
(f) A licensee may keep the records required by
subsections (d) and (e) in any form, and in the same manner,
format, or place as they keep such records in the ordinary
course of business. Failure to keep all records required by
subsections (d) and (e) is a violation of this Act.
(g) In the event of any dissolution or termination of the
licensee's business, the principal of that licensee shall
maintain all records as required under subsections (d) and
(e). In the event of any sale, assignment, or other change in
ownership of the licensee's business, the successor business
shall maintain all records required under subsections (d) and
(e).
Section 18. Penalty for violation.

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(a) If the Department finds that a person has violated any
material provision of this Act, a rule adopted pursuant to
this Act, or any other law applicable to the conduct of a
licensee, the Department may, after notice and opportunity to
cure, order or impose a penalty upon the person, which must not
exceed $1,000 per violation of law or rule, up to a maximum of
$100,000, plus the costs of investigation. Notwithstanding
anything to the contrary herein or elsewhere, a continuing
violation shall be deemed to be a singular violation and not be
given multiple effect.
(b) A finding or order that the Department issues under
this Section is a final administrative decision under the
Administrative Review Law.
Section 19. Statute of limitations. An action or
proceeding brought by the Department under this Act must be
commenced within the longer of (i) 3 years after the conduct
that underlies the complaint is discovered by the Department
or the harmed consumer or (ii) if the violation constitutes a
criminal offense, the applicable statute of limitations.
Section 20. Transitional provisions. Transactions entered
into before this Act takes effect, and the rights, duties, and
interests resulting from them, may be completed, terminated,
or enforced as required or permitted by a law amended,
repealed, modified, or preempted by this Act as though the

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amendment, repeal, modification, or preemption had not
occurred.
Section 21. Illinois Administrative Procedure Act. The
Illinois Administrative Procedure Act is hereby expressly
adopted and incorporated herein as if all of the provisions of
that Act were included in this Act.
Section 22. Rulemaking. The Department may adopt rules to
administer and enforce Section 3.
Section 900. The State Finance Act is amended by changing
Section 6z-26 as follows:
(30 ILCS 105/6z-26)
Sec. 6z-26. The Financial Institution Fund. All moneys
received by the Department of Financial and Professional
Regulation under the Safety Deposit License Act, the Foreign
Exchange License Act, the Pawners Societies Act, the Sale of
Exchange Act, the Currency Exchange Act, the Sales Finance
Agency Act, the Debt Management Service Act, the Consumer
Installment Loan Act, the Illinois Development Credit
Corporation Act, the Title Insurance Act, the Debt Resolution
Services Settlement Consumer Protection Act, the Debt
Management Service Consumer Protection Fund, and any other Act
administered by the Department of Financial and Professional

HB1289 - 31 - LRB104 07660 RTM 17704 b
Regulation as the successor of the Department of Financial
Institutions now or in the future (unless an Act specifically
provides otherwise) shall be deposited in the Financial
Institution Fund (hereinafter "Fund"), a special fund that is
hereby created in the State Treasury.
Moneys in the Fund shall be used by the Department,
subject to appropriation, for expenses incurred in
administering the above named and referenced Acts.
The Comptroller and the State Treasurer shall transfer
from the General Revenue Fund to the Fund any monies received
by the Department after June 30, 1993, under any of the above
named and referenced Acts that have been deposited in the
General Revenue Fund.
As soon as possible after the end of each calendar year,
the Comptroller shall compare the balance in the Fund at the
end of the calendar year with the amount appropriated from the
Fund for the fiscal year beginning on July 1 of that calendar
year. If the balance in the Fund exceeds the amount
appropriated, the Comptroller and the State Treasurer shall
transfer from the Fund to the General Revenue Fund an amount
equal to the difference between the balance in the Fund and the
amount appropriated.
Nothing in this Section shall be construed to prohibit
appropriations from the General Revenue Fund for expenses
incurred in the administration of the above named and
referenced Acts.

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Moneys in the Fund may be transferred to the Professions
Indirect Cost Fund, as authorized under Section 2105-300 of
the Department of Professional Regulation Law of the Civil
Administrative Code of Illinois.
(Source: P.A. 96-1420, eff. 8-3-10.)
Section 905. The Financial Institutions Code is amended by
changing Section 6 as follows:
(20 ILCS 1205/6)
Sec. 6. General powers and duties. In addition to the
powers and duties provided by law and imposed elsewhere in
this Act, the Division has the following powers and duties:
(1) To administer and enforce the Consumer Installment
Loan Act and its implementing rules.
(2) To administer and enforce the Currency Exchange
Act and its implementing rules.
(3) To administer and enforce the Debt Management
Service Act and its implementing rules.
(4) To administer and enforce the Debt Resolution
Services Settlement Consumer Protection Act and its
implementing rules.
(5) To administer and enforce the Illinois Development
Credit Corporation Act and its implementing rules.
(6) To administer and enforce the Payday Loan Reform
Act and its implementing rules.

HB1289 - 33 - LRB104 07660 RTM 17704 b
(7) To administer and enforce the Safety Deposit
License Act and its implementing rules.
(8) To administer and enforce the Sales Finance Agency
Act and its implementing rules.
(9) To administer and enforce the Title Insurance Act
and its implementing rules.
(10) To administer and enforce the Transmitters of
Money Act and its implementing rules.
(11) To administer and enforce the Predatory Loan
Prevention Act and its implementing rules.
(12) To administer and enforce the Motor Vehicle
Retail Installment Sales Act and its implementing rules.
(13) To administer and enforce the Retail Installment
Sales Act and its implementing rules.
(14) To administer and enforce the Illinois Credit
Union Act and its implementing rules.
(15) To administer and enforce the Collection Agency
Act and its implementing rules.
(16) To administer and enforce any other Act
administered by the Director or Division.
(17) If the Division is authorized or required by law
to consider some aspect of criminal history record
information for the purpose of carrying out its statutory
powers and responsibilities, to obtain from the Illinois
State Police, upon request and payment of the fees
required by the Illinois State Police Law of the Civil

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Administrative Code of Illinois, pursuant to positive
identification, such information contained in State files
as is necessary to carry out the duties of the Division.
(18) To authorize and administer examinations to
ascertain the qualifications of applicants and licensees
for which the examination is held.
(19) To conduct hearings in proceedings to revoke,
suspend, refuse to renew, or take other disciplinary
action regarding licenses, charters, certifications,
registrations, or authorities of persons as authorized in
any Act administered by the Division.
(Source: P.A. 102-538, eff. 8-20-21; 102-813, eff. 5-13-22;
102-975, eff. 1-1-23; 103-154, eff. 6-30-23.)
Section 910. The Debt Management Service Act is amended by
changing Section 2 as follows:
(205 ILCS 665/2) (from Ch. 17, par. 5302)
Sec. 2. Definitions. As used in this Act:
"Credit counselor" means an individual, corporation, or
other entity that is not a debt management service that
provides (1) guidance, educational programs, or advice for the
purpose of addressing budgeting, personal finance, financial
literacy, saving and spending practices, or the sound use of
consumer credit; or (2) assistance or offers to assist
individuals and families with financial problems by providing

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counseling; or (3) a combination of the activities described
in items (1) and (2) of this definition.
"Debt management service" means the planning and
management of the financial affairs of a debtor for a fee and
the receiving of money from the debtor for the purpose of
distributing it to the debtor's creditors in payment or
partial payment of the debtor's obligations or soliciting
financial contributions from creditors. The business of debt
management is conducted in this State if the debt management
business, its employees, or its agents are located in this
State or if the debt management business solicits or contracts
with debtors located in this State. "Debt management service"
does not include "debt resolution services" "debt settlement
service" as defined in the Debt Resolution Services Settlement
Consumer Protection Act.
This term shall not include the following when engaged in
the regular course of their respective businesses and
professions:
(a) Attorneys at law licensed, or otherwise authorized
to practice, in Illinois who are engaged in the practice
of law.
(b) Banks, operating subsidiaries of banks, affiliates
of banks, fiduciaries, credit unions, savings and loan
associations, and savings banks as duly authorized and
admitted to transact business in the State of Illinois and
performing credit and financial adjusting service in the

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regular course of their principal business.
(c) Title insurers, title agents, independent
escrowees, and abstract companies, while doing an escrow
business.
(d) Judicial officers or others acting pursuant to
court order.
(e) Employers for their employees, except that no
employer shall retain the services of an outside debt
management service to perform this service unless the debt
management service is licensed pursuant to this Act.
(f) Bill payment services, as defined in the
Transmitters of Money Act.
(g) Credit counselors, only when providing services
described in the definition of credit counselor in this
Section.
"Debtor" means the person or persons for whom the debt
management service is performed.
"Person" means an individual, firm, partnership,
association, limited liability company, corporation, or
not-for-profit corporation.
"Licensee" means a person licensed under this Act.
"Secretary" means the Secretary of Financial and
Professional Regulation.
(Source: P.A. 100-201, eff. 8-18-17.)
(225 ILCS 429/Act rep.)

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Section 915. The Debt Settlement Consumer Protection Act
is repealed.
Section 920. The Consumer Fraud and Deceptive Business
Practices Act is amended by changing Section 2JJJ as follows:
(815 ILCS 505/2JJJ)
Sec. 2JJJ. Violations of the Debt Resolution Services
Settlement Consumer Protection Act. Any person who violates
the Debt Resolution Services Settlement Consumer Protection
Act commits an unlawful practice within the meaning of this
Act.
(Source: P.A. 96-1420, eff. 8-3-10; 97-333, eff. 8-12-11.)