Bill Text: OH HB554 | 2009-2010 | 128th General Assembly | Introduced

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Bill Title: To establish the Installment Loan Act.

Spectrum: Bipartisan Bill

Status: (Introduced - Dead) 2010-06-15 - To Consumer Affairs & Economic Protection [HB554 Detail]

Download: Ohio-2009-HB554-Introduced.html

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As Introduced

128th General Assembly Regular Session 2009-2010

H. B. No. 554

Representative Luckie 

Cosponsors: Representatives Hackett, Domenick, McGregor, Coley, Slesnick, Derickson 

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A BILL

To amend section 121.085 and to enact sections

1

1322.21 to 1322.38 of the Revised Code to

2

establish the Installment Loan Act.

3

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That section 121.085 be amended and sections	4
1322.21, 1322.22, 1322.23, 1322.24, 1322.25, 1322.26, 1322.27,	5
1322.28, 1322.29, 1322.30, 1322.31, 1322.32, 1322.33, 1322.34,	6
1322.35, 1322.36, 1322.37, and 1322.38 of the Revised Code be	7
enacted to read as follows:	8

Sec. 121.085. The financial literacy education fund is hereby	9
created in the state treasury. The fund shall consist of funds	10
transferred to it from the consumer finance fund pursuant to	11
section 1321.21 of the Revised Code and the assessments collected	12
by the superintendent of financial institutions pursuant to	13
section 1322.37 of the Revised Code. The fund shall be used to	14
support various adult financial literacy education programs	15
developed or implemented by the director of commerce. The fund	16
shall be administered by the director of commerce who shall adopt	17
rules for the distribution of fund moneys. The director of	18
commerce shall adopt a rule to require that at least one-half of	19
the financial literacy education programs developed or implemented	20
pursuant to this section, and offered to the public, be presented	21
by or available at public community colleges or state institutions	22
throughout the state. The director of commerce shall deliver to	23
the president of the senate, the speaker of the house of	24
representatives, the minority leader of the senate, the minority	25
leader of the house of representatives, and the governor an annual	26
report that includes an outline of each adult financial literacy	27
education program developed or implemented, the number of	28
individuals who were educated by each program, and an accounting	29
for all funds distributed.	30

Sec. 1322.21.  As used in sections 1322.21 to 1322.38 of the	31
Revised Code:	32

(A) "Installment loan" means any loan, advance of money, or	33
extension of credit that meets all of the following criteria:	34

(1) It has a principal amount of at least one hundred dollars	35
but not more than five thousand dollars.	36

(2) It has a repayment term of not less than ninety days.

37

(3) It is payable in substantially equal and consecutive	38
installments of principal and interest combined.	39

(4) It is computed on a pre-computed basis.

40

(B) "Licensee" means a person to whom the superintendent of	41
financial institutions has issued one or more licenses under	42
sections 1322.21 to 1322.38 of the Revised Code.	43

(C) "Superintendent of financial institutions" includes the	44
deputy superintendent for consumer finance as provided in section	45
1181.21 of the Revised Code.	46

Sec. 1322.22.  Sections 1322.21 to 1322.38 of the Revised	47
Code shall be known as the "installment loan act."	48

Sec. 1322.23.  (A) On and after January 1, 2011, no person	49
shall engage in the business of making installment loans to a	50
borrower in this state without first having obtained a license	51
from the superintendent of financial institutions under sections	52
1322.21 to 1322.38 of the Revised Code. An installment loan	53
license shall be required for each location in this state from	54
which the person will engage in the business of making installment	55
loans. If the person intends to make installment loans to	56
borrowers in this state via the telephone, mail, or internet and	57
does not maintain a physical presence in this state, the person	58
shall obtain an installment loan license for the out-of-state	59
location at which the person will maintain the records evidencing	60
the loans.	61

(B) Sections 1322.21 to 1322.38 of the Revised Code do not	62
apply to any of the following:	63

(1) Any bank, savings bank, savings and loan association,	64
credit union, or credit union service organization organized under	65
the laws of this state, another state, or the United States;	66

(2) Any licensee under sections 1321.01 to 1321.19 of the	67
Revised Code;	68

(3) Any licensee under sections 1321.35 to 1321.48 of the	69
Revised Code;	70

(4) Any registrant under sections 1321.51 to 1321.60 of the	71
Revised Code.	72

Sec. 1322.24.  (A) Applications for an installment loan	73
license shall be in writing, under oath, and in the form	74
prescribed by the superintendent of financial institutions. The	75
application shall contain the name and address of the applicant;	76
the location or locations where the business of making installment	77
loans is to be conducted or, if the person intends to make	78
installment loans to borrowers in this state via the telephone,	79
mail, or internet and does not maintain a physical presence in	80
this state, the out-of-state location at which the person will	81
maintain the records evidencing the loans; background information	82
concerning the applicant's officers, directors, or other persons	83
controlling the applicant's lending operations; and any further	84
information the superintendent requires.	85

(B) An application for an original installment loan license	86
shall be accompanied by a nonrefundable application fee of five	87
hundred dollars per location where the business of making	88
installment loans is to be conducted or out-of-state location	89
where records evidencing the loans will be maintained, as	90
applicable.	91

Sec. 1322.25.  (A) Upon the filing of an application for an	92
original installment loan license, and payment of the application	93
fee required under section 1322.24 of the Revised Code, the	94
superintendent of financial institutions shall investigate the	95
facts concerning the applicant. The superintendent may gather such	96
evidence, including criminal background checks and testimony given	97
under oath, as the superintendent determines necessary to make the	98
findings required by this section.	99

(B) Upon conclusion of the investigation, the superintendent	100
shall issue an installment loan license if the superintendent	101
finds that the financial responsibility, character, and general	102
fitness of the applicant are such as to warrant the belief that	103
the business of making installment loans will be conducted	104
honestly and fairly in compliance with sections 1322.21 to 1322.38	105
of the Revised Code.	106

(C) The superintendent shall either approve or deny an	107
application within sixty days after the date the superintendent	108
deems the application complete. An application shall be deemed	109
approved if it is not denied within that sixty-day period. If the	110
superintendent finds that the applicant does not meet the	111
requirements of division (B) of this section, the superintendent	112
shall issue an order denying the application and giving the	113
applicant an opportunity for a hearing on the denial in accordance	114
with Chapter 119. of the Revised Code.	115

Sec. 1322.26.  (A) An installment loan license issued under	116
section 1322.25 of the Revised Code may be renewed on or before	117
the thirty-first day of December of the calendar year in which the	118
original license was issued, and on or before the thirty-first day	119
of December of each calendar year thereafter, if the	120
superintendent of financial institutions finds that both of the	121
following conditions are met:	122

(1) The renewal application is accompanied by a nonrefundable	123
application fee of two hundred fifty dollars per location where	124
the business of making installment loans is to be conducted or	125
out-of-state location where records evidencing the loans will be	126
maintained, as applicable.	127

(2) The applicant meets the requirements of division (B) of	128
section 1322.25 of the Revised Code.	129

(B) The superintendent shall either approve or deny a renewal	130
application within sixty days after the date the superintendent	131
deems the application complete. An application shall be deemed	132
approved if it is not denied within that sixty-day period. If the	133
superintendent finds that the applicant does not meet the	134
requirements of division (A) of this section, the superintendent	135
shall issue an order denying the application and giving the	136
applicant an opportunity for a hearing on the denial in accordance	137
with Chapter 119. of the Revised Code.	138

Sec. 1322.27.  (A) Each installment loan license shall be	139
kept conspicuously posted in the place of business of the licensee	140
and is not transferable or assignable.	141

(B) No change in the place of business of a licensee shall be	142
permitted under the same license. When a licensee wishes to change	143
the licensee's place of business, the licensee shall give at least	144
thirty days' advance notice thereof to the division of financial	145
institutions. Within thirty days after receipt of that notice, the	146
superintendent of financial institutions shall issue a license for	147
the new location, unless the superintendent finds the licensee no	148
longer meets the necessary requirements.	149

(C) No change in the control of a licensee shall be permitted	150
under the same license. As used in this division, "change in the	151
control" means the sale or transfer of more than twenty-five per	152
cent of the licensee's ownership interest.	153

Sec. 1322.28.  A licensee shall disclose in any printed,	154
televised, broadcast, electronically transmitted, or published	155
advertising relating to the licensee's services, including on any	156
electronic site accessible through the internet, the number	157
designated on the installment loan license issued to the licensee.	158

Sec. 1322.29.  (A) In connection with an installment loan, a	159
licensee may charge, collect, and receive interest or finance	160
charges at any rate or rates agreed upon or consented to by the	161
parties to the loan contract but not exceeding twenty-five per	162
cent per year on the unpaid principal balances of the loan.	163

(B) In addition to the interest and charges authorized under	164
division (A) of this section, a licensee may charge, collect, and	165
receive, as interest, a loan origination fee and credit report fee	166
or, if the installment loan is a refinancing of a previous	167
installment loan made by the licensee, a renewal fee. Such fees	168
shall not, however, exceed the maximum fee amounts established by	169
the superintendent of financial institutions under section 1322.38	170
of the Revised Code or be included in the computation of the	171
twenty-five per cent limitation set forth in division (A) of this	172
section.	173

(C)(1) A licensee may accept as security for an installment	174
loan any of the following types of insurance:	175

(a) Insurance on tangible property against substantial risks	176
or loss;	177

(b) Insurance on the life and health of the borrower;

178

(c) Insurance against an accident of the borrower.

179

(2) The premium the borrower pays, or agrees to pay, for any	180
such insurance shall not constitute interest for purposes of	181
division (A) of this section. An insurance company may pay to the	182
party writing the insurance policy a commission that is reasonable	183
in relation to the commission the insurance company pays for a	184
comparable transaction not involving credit.	185

(D) A licensee may charge, collect, and receive an amount	186
equal to the attorney's fees the licensee incurs in the process of	187
collecting on an installment loan after default, provided the	188
amount does not exceed ten per cent of the original principal	189
amount of the loan.	190

(E) A licensee may place a lien on the borrower's personal	191
property as security for a loan but shall not place a lien on the	192
borrower's real property except when the lien is created upon the	193
filing or recording of a certificate of judgment.	194

Sec. 1322.30.  (A) An installment loan made under sections	195
1322.21 to 1322.38 of the Revised Code shall be made pursuant to a	196
written loan contract that sets forth the terms and conditions of	197
the loan. The loan contract shall disclose in a clear and concise	198
manner all of the following:	199

(1) The date and amount of the loan;

200

(2) The cost of credit, as required by the "Truth in Lending	201
Act," 82 Stat. 146 (1974), 15 U.S.C. 1601, et seq.;	202

(3) A payment schedule;

203

(4) The type of security required for the loan;

204

(5) The licensee's name and address;

205

(6) The amount of each type of insurance carried and the	206
premiums paid for each type;	207

(7) The amount of interest, fees, and other charges,	208
including any default penalties;	209

(8) A statement immediately above the borrower's signature,	210
printed in boldface type of the minimum size of twelve points, as	211
follows: "WARNING: THE COST OF THIS INSTALLMENT LOAN MAY BE HIGHER	212
THAN THE COST OF CREDIT YOU MAY BE ABLE TO OBTAIN FROM ANOTHER	213
LENDER, SUCH AS A BANK OR CREDIT UNION, OR FROM FRIENDS, FAMILY	214
MEMBERS, OR NON-PROFIT ORGANIZATIONS. BE SURE TO CONSIDER ALL YOUR	215
BORROWING OPTIONS BEFORE SIGNING THIS AGREEMENT."	216

(9) A statement, printed in boldface type of the minimum size	217
of twelve points, that informs the borrower of the phone number or	218
the mail or web site address at which the borrower may submit	219
complaints regarding the loan or the licensee to the	220
superintendent of financial institutions. If the borrower submits	221
such a complaint, the licensee shall promptly and fully cooperate	222
with the superintendent's investigation and resolution of the	223
complaint.	224

(B) A borrower, at the borrower's election, may pay an	225
installment loan with any one or more of the following payment	226
methods:	227

(1) Cash or a cash equivalent;

228

(2) Personal check;

229

(3) Automated clearinghouse (ACH) entry, provided the	230
licensee does not condition its extension of credit on the	231
borrower's agreement to pay the loan with recurring ACH entries;	232

(4) Debit card, provided that the licensee maintains the	233
equipment necessary to accept such payments and does not condition	234
its extension of credit on the borrower's agreement to pay the	235
loan with recurring debit card payments.	236

(C) A borrower may rescind an installment loan for any reason	237
by returning the loan proceeds to the licensee in the form of cash	238
not later than the close-of-business on the business day	239
immediately following the date the borrower obtained the loan. A	240
licensee shall not collect any interest, fees, or other charges on	241
a rescinded loan.	242

Sec. 1322.31.  Prior to consummating an installment loan, a	243
licensee shall deliver to the prospective borrower a document in	244
substantially the following form:	245

"BORROWER'S BILL OF RIGHTS	246

1. RIGHT TO INTEREST RATE LIMIT. The lender may not collect	247
interest at a rate greater than permitted by law.	248

2. RIGHT TO RESPONSIBLE LENDING PRACTICES. This loan is an	249
installment loan that you must pay according to the payment	250
schedule outlined in the loan contract, which schedule must be at	251
least 90 days in duration under state law. Additionally, to ensure	252
that you have the ability to pay this loan in full without default	253
or refinancing, the monthly payment you owe on the loan may not	254
exceed twenty-five per cent of your monthly gross income. Finally,	255
the lender may not allow you to refinance or rollover this loan,	256
and may not make a new installment loan to you on the same day	257
that you pay this loan.	258

3. RIGHT TO FREE FINANCIAL LITERACY EDUCATION PROGRAMS. State	259
law requires the lender to contribute part of its revenue from	260
this loan to the state's Financial Literacy Education Fund. The	261
lender may be periodically required by the state to provide	262
point-of-sale notice of the location, date, and time of financial	263
literacy education programs that are supported by this state fund.	264

4. RIGHT TO FREE RESCISSION PERIOD. You may rescind this loan	265
for any reason by returning the loan proceeds to the lender in the	266
form of cash not later than the close-of-business on the business	267
day immediately following the date you obtained the loan. The	268
lender may not collect any interest, fees, or other charges on a	269
rescinded loan.	270

5. RIGHT TO FAIR COLLECTION PRACTICES. If you default on this	271
loan, the lender must act fairly and professionally when	272
collecting the loan.	273

6. RIGHT TO FULL DISCLOSURE OF LOAN TERMS. The loan contract	274
must provide full disclosure of all important loan terms,	275
including the finance charges and interest rate. Additionally, the	276
loan contract must contain a written warning, immediately above	277
your signature, advising you that the cost of this loan may be	278
higher than the cost of credit you may be able to obtain	279
elsewhere.	280

7. RIGHT TO TRUTHFUL ADVERTISING. The lender may not make any	281
false or misleading statement regarding the rates, terms, or	282
conditions of an installment loan in its advertisements.	283
Additionally, the lender must list, in all of its advertisements,	284
the number designated on the installment loan license issued to	285
the lender.	286

8. RIGHT TO PREPAYMENT REBATE. You may prepay this loan at	287
any time without a penalty. If you choose to prepay this loan, the	288
lender may charge interest only for the time that the loan	289
principal was actually outstanding.	290

9. RIGHT TO COMPLAINT RESOLUTION. The loan contract must	291
provide the phone number or mail or website address at which the	292
borrower may submit complaints regarding the loan or the lender to	293
the state Superintendent of Financial Institutions. If you submit	294
such a complaint, the lender must promptly and fully cooperate	295
with the Superintendent's investigation and resolution of the	296
complaint.	297

10. RIGHT TO CONVENIENT PAYMENT METHODS. You may choose to	298
pay this loan in a manner that is convenient to you, including by	299
cash, check, or electronic funds transfer."	300

Sec. 1322.32.  No licensee shall do any of the following:

301

(A) Make an installment loan if, at the time the loan was	302
consummated, the borrower's total monthly payment owed on the loan	303
exceeds twenty-five per cent of the borrower's monthly gross	304
income;	305

(B) Make an installment loan to a borrower if an installment	306
loan between that borrower and the licensee was terminated on the	307
same business day;	308

(C) Divide a borrower's loan request into separate loans,	309
each consummated within a seven-day period, if the purpose or	310
effect of that practice would be to charge, collect, or receive	311
more interest, fees, or other charges than the licensee would have	312
been permitted to charge, collect, or receive if the licensee had	313
made a single installment loan to the borrower;	314

(D) Charge, collect, or receive any interest, fees, or	315
charges in connection with an installment loan other than as	316
authorized under sections 1322.21 to 1322.38 of the Revised Code,	317
except for the following:	318

(1) The amount of lawful premiums actually paid for insurance	319
against the risk of nonrecording or releasing any instrument	320
securing the loan;	321

(2) The actual and reasonable expenses of repossessing,	322
storing, and selling any collateral pledged as security for a loan	323
in default;	324

(3) The court costs awarded by a court in connection with the	325
licensee's collection of a loan in default.	326

(E) Charge a fee for cashing a proceeds check or money order	327
disbursed to fund a loan made by the licensee or an affiliate of	328
the licensee;	329

(F) Impose a prepayment penalty. If a borrower prepays an	330
installment loan, the licensee shall refund or credit the borrower	331
with the aggregate of all applicable charges for all fully	332
unexpired installment periods, as originally scheduled, that	333
follow the date of prepayment. If the prepayment is made other	334
than on a scheduled installment due date, the nearest scheduled	335
installment due date shall be used for purposes of that	336
computation.	337

(G) Advertise, display, distribute, or broadcast any false,	338
misleading, or deceptive statement or representation regarding the	339
rates, terms, or conditions of an installment loan;	340

(H) Report the repayment performance of an installment loan	341
to any consumer reporting agency, as that term is defined in	342
section 1322.33 of the Revised Code, unless the agency that	343
receives the information records it as a tier 1 credit event.	344

Sec. 1322.33. (A) As used in this section:

345

(1) "Debt collector" means a licensee, officer, employee, or	346
agent of a licensee, or any person acting as a debt collector for	347
a licensee, or any person while serving or attempting to serve	348
legal process on any other person in connection with the judicial	349
enforcement of any debt resulting from an installment loan made by	350
a licensee. "Debt collector" does not include an employee of the	351
licensee when making courtesy calls to remind borrowers of	352
upcoming installment due dates.	353

(2) "Borrower" means a person who has an outstanding or	354
delinquent installment loan. For the purpose of this section, the	355
term "borrower" includes the borrower's spouse, parent, if the	356
borrower is a minor, guardian, executor, or administrator.	357

(3) "Communication" means the conveying of information	358
regarding a debt directly or indirectly to any person through any	359
medium.	360

(4) "Consumer reporting agency" means any person that, for	361
monetary fees, dues, or on a cooperative nonprofit basis,	362
regularly engages in whole or in part in the practice of	363
assembling or evaluating consumer credit information or other	364
information on consumers for the purpose of furnishing consumer	365
reports to third parties and that uses any means or facility for	366
the purpose of preparing or furnishing consumer reports.	367

(5) "Location information" means a consumer's residence,	368
telephone number, or place of employment.	369

(B) When communicating with any person other than the	370
borrower for the purpose of acquiring location information about	371
the borrower, the debt collector shall identify self, state that	372
the purpose for the communication is to confirm or correct	373
location information concerning a person, and, only if expressly	374
requested, identify the debt collector's employer. The debt	375
collector shall not do any of the following:	376

(1) State that the person for whom location information is	377
being sought is a borrower or owes any debt;	378

(2) Communicate by post card;

379

(3) Use any language or symbol on any envelope or in the	380
contents of any communication effected by the mails or telegram	381
that indicates that the communication relates to the collection of	382
a debt;	383

(4) After the debt collector knows the borrower is	384
represented by an attorney with regard to the subject debt and has	385
knowledge of, or can readily ascertain, such attorney's name and	386
address, not communicate with any person other than that attorney,	387
unless the attorney fails to respond within a reasonable period of	388
time to communication from the debt collector.	389

(C) A debt collector, without the prior consent of the	390
borrower given directly to the debt collector or without the	391
express permission of a court of competent jurisdiction, may not	392
communicate with a borrower in connection with the collection of	393
any debt:	394

(1) At any unusual time or place or a time or place known or	395
which should be known to be inconvenient to the borrower. In the	396
absence of knowledge of circumstances to the contrary, a debt	397
collector shall assume that the convenient time for communicating	398
with a borrower is after eight a.m. eastern standard time and	399
before nine p.m. eastern standard time at the borrower's location.	400

(2) If the debt collector knows the borrower is represented	401
by an attorney with respect to such debt and has knowledge of, or	402
can readily ascertain, such attorney's name and address, unless	403
the attorney fails to respond within a reasonable period of time	404
to a communication from the debt collector or unless the attorney	405
consents to direct communication with the borrower;	406

(3) At the borrower's place of employment if the debt	407
collector knows or has reason to know that the borrower's employer	408
prohibits the borrower from receiving such communication.	409

(D) A debt collector, when communicating with a third party	410
without the prior consent of the borrower given directly to the	411
debt collector, or without the express permission of a court of	412
competent jurisdiction, or as reasonably necessary to effectuate a	413
postjudgment judicial remedy, may not communicate, in connection	414
with the collection of any debt, with any person other than the	415
borrower, the borrower's attorney, a consumer reporting agency if	416
otherwise permitted by law, the attorney of the debt collector, or	417
a person from whom the debt collector seeks to acquire location	418
information about the borrower.	419

(E) A debt collector may not engage in any conduct the	420
natural consequence of which is to harass, oppress, or abuse any	421
person in connection with the collection of a debt, including, but	422
not limited to, any of the following:	423

(1) Using or threatening to use violence or other criminal	424
means to harm the physical person, reputation, or property of any	425
person;	426

(2) Using obscene or profane language or language the natural	427
consequence of which is to abuse the hearer or reader;	428

(3) Publication of a list of borrowers who allegedly refuse	429
to pay debts, except to a consumer-reporting agency;	430

(4) Causing a telephone to ring or engaging any person in	431
telephone conversation repeatedly or continuously with intent to	432
annoy, abuse, or harass any person at the called number.	433

(F) A debt collector may not use any false, deceptive, or	434
misleading representation or means in connection with the	435
collection of any debt, including, but not limited to, any of the	436
following:	437

(1) Falsely representing or implying that the debt collector	438
is vouched for, bonded by, or affiliated with the United States or	439
any state, including the use of any badge, uniform, or facsimile	440
thereof;	441

(2) Falsely representing the character, amount, or legal	442
status of any debt, or any services rendered, or compensation	443
which may be lawfully received by any debt collector for the	444
collection of a debt;	445

(3) Falsely representing or implying that any individual is	446
an attorney or that any communication is from an attorney;	447

(4) Representing or implying that nonpayment of any debt will	448
result in the arrest or imprisonment of any person or the seizure,	449
garnishment, attachment, or sale of any property or wages of any	450
person unless such action is lawful and the debt collector intends	451
to take such action;	452

(5) Threatening to take any action that cannot legally be	453
taken or that is not intended to be taken;	454

(6) Falsely representing or implying that a sale, referral,	455
or other transfer of any interest in a debt shall cause the	456
borrower to lose any claim or defense to payment of the debt;	457

(7) Falsely representing or implying that the borrower	458
committed any crime or other conduct in order to disgrace the	459
borrower;	460

(8) Communicating or threatening to communicate to any person	461
credit information that is known or that should be known to be	462
false, including the failure to communicate that a disputed debt	463
is disputed;	464

(9) Using or distributing any written communication that	465
simulates or is falsely represented to be a document authorized,	466
issued, or approved by any court, official, or agency of the	467
United States or any state, or that creates a false impression as	468
to its source, authorization, or approval;	469

(10) Using any false representation or deceptive means to	470
collect or attempt to collect any debt or to obtain information	471
concerning a borrower;	472

(11) Failing to disclose in the initial written communication	473
with the borrower that the debt collector is attempting to collect	474
a debt and that any information obtained will be used for that	475
purpose, and the failure to disclose in subsequent written	476
communications that the communication is from a debt collector,	477
except that division (F)(11) of this section shall not apply to a	478
formal pleading made in connection with a legal action;	479

(12) Falsely representing or implying that accounts have been	480
turned over to third parties for value;	481

(13) Falsely representing or implying that documents are	482
legal process;	483

(14) Using any business, company, or organization name other	484
than the true name of the debt collector's business, company, or	485
organization. Nothing in division (F)(14) of this section	486
prohibits the use of trade names or acronyms the business,	487
company, or organization is known by.	488

(15) Falsely representing or implying that documents are not	489
legal process forms or do not require action by the consumer;	490

(16) Falsely representing or implying that a debt collector	491
operates or is employed by a consumer reporting agency.	492

(G) A debt collector may not use unfair or unconscionable	493
means to collect or attempt to collect any debt, including, but	494
not limited to, any of the following:	495

(1) Collecting any amount, including any interest, fee,	496
charge, or expense incidental to the principal obligation, unless	497
the amount is expressly authorized by the agreement creating the	498
debt or permitted by law;	499

(2) Soliciting any postdated check or other postdated payment	500
instrument for the purpose of threatening or instituting criminal	501
prosecution;	502

(3) Depositing or threatening to deposit any postdated check	503
or other postdated payment instrument prior to the date on the	504
check or instrument;	505

(4) Causing charges to be made to any person for	506
communications by concealment of the true purpose of the	507
communication. The charges include, but are not limited to,	508
collect telephone calls and telegram fees. Division (G)(4) of this	509
section does not apply to any form of communication that is	510
authorized by the borrower for the express purpose of contacting	511
the borrower about the loan.	512

(5) Taking or threatening to take any nonjudicial action to	513
effect dispossession or disablement of property if there is no	514
present right to possession of the property claimed as collateral	515
through an enforceable security interest, there is no present	516
intention to take possession of the property, or the property is	517
exempt by law from dispossession or disablement;	518

(6) Communicating with a borrower regarding a debt by post	519
card;	520

(7) Using any language or symbol, other than the debt	521
collector's address, on any envelope when communicating with a	522
borrower by use of the mails or by telegram, except that a debt	523
collector may use the collector's business name if the name does	524
not indicate that the collector is in the debt collection	525
business. Nothing in division (G)(7) of this section prohibits the	526
use of trade names or acronyms the business is known by.	527

(8) Designing, compiling, and furnishing any form knowing	528
that the form would be used to create the false belief in a	529
borrower that a person other than the licensee is participating in	530
the collection of or in an attempt to collect a debt the borrower	531
allegedly owes the creditor, when in fact the person is not so	532
participating.	533

Sec. 1322.34.  (A) Each licensee shall keep and use in the	534
licensee's business such books, accounts, and records as will	535
enable the superintendent of financial institutions to determine	536
whether the licensee is complying with sections 1322.21 to 1322.38	537
of the Revised Code. Each licensee shall preserve those books,	538
accounts, and records for at least four years after making the	539
final entry on any installment loan recorded therein.	540

(B) As required by the superintendent, each licensee shall	541
file an annual report with the division of financial institutions	542
detailing the licensee's origination and collection of installment	543
loans during the preceding year.	544

Sec. 1322.35.  (A) As often as the superintendent of	545
financial institutions considers it necessary, the superintendent,	546
or the superintendent's designee, may examine the records of any	547
of the following:	548

(1) Any licensee;

549

(2) Any person who advertises, solicits, or makes installment	550
loans in this state;	551

(3) Any person whom the superintendent has reason to believe	552
is violating or is about to violate any provision of sections	553
1322.21 to 1322.38 of the Revised Code.	554

(B) In conducting examinations pursuant to this section, the	555
superintendent may subpoena witnesses, books, accounts, papers,	556
and records; administer oaths; hold hearings; and take testimony	557
under oath.	558

(C) The cost of any examination, investigation, or hearing	559
authorized under sections 1322.21 to 1322.38 of the Revised Code	560
may, in the superintendent's discretion, be charged to the	561
licensee or other person examined or investigated. Examinations,	562
investigations, or hearings may be conducted at the department of	563
commerce or, in the discretion of the superintendent, in the	564
county in which the business of the licensee is located or in	565
which the person required to have an installment loan license is	566
engaging in the business of making installment loans.	567

Sec. 1322.36.  (A) If the superintendent of financial	568
institutions determines that a person is engaged in or is believed	569
to be engaged in activities that may constitute a violation of or	570
failure to comply with any provision of sections 1322.21 to	571
1322.38 of the Revised Code or any rule adopted thereunder, the	572
superintendent, after notice and a hearing conducted in accordance	573
with Chapter 119. of the Revised Code, may issue a cease and	574
desist order. Such an order shall be enforceable in the court of	575
common pleas. The remedy provided for in this division does not	576
preclude the superintendent from pursuing any other remedy	577
available by law.	578

(B) After notice and opportunity for a hearing conducted in	579
accordance with Chapter 119. of the Revised Code, the	580
superintendent may suspend, revoke, or refuse to issue or renew an	581
installment loan license if the superintendent finds a violation	582
of or failure to comply with any provision of sections 1322.21 to	583
1322.38 of the Revised Code or the rules adopted thereunder or	584
with any terms of a cease and desist order issued by the	585
superintendent. Upon the appeal of an order suspending or revoking	586
a license, the court may tax court costs to the losing party.	587

(C) A suspension, revocation, relinquishment, or expiration	588
of an installment loan license shall not affect the legality of	589
any pre-existing installment loan contract or prevent the	590
enforcement of those contracts.	591

Sec. 1322.37.  (A) The superintendent of financial	592
institutions shall assess each licensee, at least once every three	593
months, an amount equal to one per cent of the installment loan	594
revenue the licensee generated during that period. The	595
superintendent shall deposit those assessments into the state	596
treasury to the credit of the financial literacy education fund	597
created in section 121.085 of the Revised Code.	598

(B) The superintendent may require each licensee to make	599
available to its customers, in a form prescribed by the	600
superintendent, information as to the location, date, and time of	601
any financial literacy education programs that are supported by	602
the financial literacy education fund.	603

Sec. 1322.38.  (A) The superintendent of financial	604
institutions shall, in accordance with Chapter 119. of the Revised	605
Code, adopt rules that the superintendent considers necessary for	606
the implementation of sections 1322.21 to 1322.38 of the Revised	607
Code, including rules that establish the maximum loan origination	608
fee, credit report fee, and renewal fee that may be charged by	609
licensees under division (B) of section 1322.29 of the Revised	610
Code. The maximum fee amounts so established shall permit a	611
licensee to both defray its reasonable operating costs and earn a	612
profit that is commensurate with the profit margins earned by	613
other financial institutions making consumer loans to residents of	614
this state. To determine the maximum fee amounts, the	615
superintendent shall appoint and consult with a five-member	616
advisory committee consisting of persons with banking-related	617
experience. The committee shall be appointed not later than	618
January 1, 2011.	619

(B) In addition to imposing the assessment required by	620
section 1322.37 of the Revised Code, the superintendent may	621
advertise, sponsor, or promote activities or events designed to	622
support the financial literacy education of consumers who obtain	623
installment loans made under sections 1322.21 to 1322.38 of the	624
Revised Code.	625

Section 2.  That existing section 121.085 of the Revised Code	626
is hereby repealed.	627