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| 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 |
| 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 |
| 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 |