To amend section 1321.21 and to enact sections 1315.61 to 1315.72 of the Revised Code to regulate under the Superintendent of Financial Institutions the facilitation of refund anticipation loans and refund anticipation checks, including with respect to registration and surety bond requirements, consumer disclosures, interest rate limitations, prohibited acts, administrative penalties, and civil remedies.

Section 1. That section 1321.21 be amended and sections 1315.61, 1315.62, 1315.63, 1315.64, 1315.65, 1315.66, 1315.67, 1315.68, 1315.69, 1315.70, 1315.71, and 1315.72 of the Revised Code be enacted to read as follows:

Sec. 1315.61.  As used in sections 1315.61 to 1315.72 of the Revised Code:

(A) "Consumer" means a natural person who, singly or jointly with another consumer, is solicited for, applies for, or receives the proceeds of a refund anticipation loan or refund anticipation check.

(B) "Refund anticipation check" means a check or other payment mechanism that represents the proceeds of a consumer's income tax refund or tax credits, that is issued by a depository institution or other person that received a direct deposit of the consumer's tax refund or tax credits, and for which a consumer has paid a fee or other consideration.

(C) "Refund anticipation loan" means a loan secured by or to be repaid, directly or indirectly, from the proceeds of a consumer's income tax refund or tax credits. "Refund anticipation loan" includes any sale, assignment, or purchase of a consumer's income tax refund of tax credits at a discount or for a fee, whether or not the consumer is required to repay a buyer or assignee if the internal revenue service denies or reduces the consumer's tax refund or tax credits.

(D) "Refund anticipation loan fee" means the charges, fees, or other consideration charged or imposed directly or indirectly by the registrant or person taking assignment of a refund anticipation loan. The term includes any charge, fee, or other consideration for a deposit account, if a deposit account is used for receipt of the consumer's income tax refund or tax credits to repay the amount owed on the refund anticipation loan. It does not include any charge, fee, or other consideration usually charged or imposed by the registrant in the ordinary course of business, such as fees for tax return preparation and fees for electronic filing of tax returns, if the same fees in the same amount are charged to the registrant's customers who do not receive refund anticipation loans or refund anticipation checks.

(E) "Refund anticipation loan interest rate" means the interest rate for a refund anticipation loan calculated by dividing the total amount of refund anticipation loan fees by the loan amount, which loan amount is minus any loan fees; then dividing by the number of days in the loan term; then multiplying by three hundred sixty-five and expressing the product as a percentage. In making this calculation, both of the following apply:

(1) If a deposit account is established or maintained in whole or in part for the purpose of receiving the consumer's income tax refund or tax credits to repay the amount owed for the refund anticipation loan, then the maturity of the loan for the purpose of determining the refund anticipation loan interest rate is the estimated date when the tax refund or tax credits will be deposited in the deposit account, and any fee charged to the consumer for the deposit account is considered a loan fee to be included in the calculation of the refund anticipation loan interest rate.

(2) If no deposit account is established or maintained for the repayment of the refund anticipation loan, the maturity of the loan is the estimated date when the tax refund or tax credits will be received by the registrant or person taking assignment of the refund anticipation loan.

(F) "Registrant" means a person that has been issued a certificate of registration under section 1315.63 of the Revised Code.

Sec. 1315.62.  (A) No person, individually or in conjunction or cooperation with another person, shall solicit, process, receive, or accept an application or agreement for a refund anticipation loan or refund anticipation check transaction, or make, facilitate, or in any manner assist in making a refund anticipation loan or refund anticipation check transaction, unless the person has obtained a certificate of registration from the superintendent of financial institutions pursuant to section 1315.63 of the Revised Code.

(B) Sections 1315.61 to 1315.72 of the Revised Code do not apply to a person that is a bank, savings bank, savings and loan association, savings association, or credit union organized under laws of the United States or of this state.

Sec. 1315.63.  (A) An application for a certificate of registration shall be in writing, under oath, and in the form prescribed by the superintendent of financial institutions. The application shall be accompanied by a nonrefundable fee, payable to the superintendent, of two hundred dollars for each place of business in this state where the applicant intends to solicit, process, receive, or accept an application or agreement for a refund anticipation loan or refund anticipation check transaction or to make, facilitate, or in any manner assist in making a refund anticipation loan or refund anticipation check transaction. The application shall provide evidence of compliance with the surety bond requirement of section 1315.65 of the Revised Code and all other information that the superintendent requires.

(B)(1) Upon the filing of an application and payment of the application fee, the superintendent shall investigate the applicant. Upon conclusion of the investigation, the superintendent shall issue a certificate of registration to the applicant if the superintendent finds that the following conditions are met:

(a) The applicant complies with the surety bond requirement of section 1315.65 of the Revised Code.

(b) The responsibility and general fitness of the applicant are such as to command the confidence of the community and to warrant belief that the business of soliciting, processing, receiving, or accepting an application or agreement for a refund anticipation loan or refund anticipation check transaction, or of making, facilitating, or in any manner assisting in making a refund anticipation loan or refund anticipation check transaction, will be operated in compliance with sections 1315.61 to 1315.72 of the Revised Code.

(2) If the superintendent finds that the applicant does not meet the requirements of division (B)(1) of this section, the superintendent shall issue an order denying the application for a certificate of registration and giving the applicant an opportunity for a hearing on the denial in accordance with Chapter 119. of the Revised Code. The superintendent shall notify the applicant of the denial, the grounds for the denial, and the applicant's opportunity for a hearing.

(C) The certificate of registration issued pursuant to division (B) of this section may be renewed annually on or before the thirty-first day of December if the superintendent finds that all of the following conditions are met:

(1) The renewal application is accompanied by a nonrefundable renewal fee, payable to the superintendent, of two hundred dollars for each place of business in this state where the applicant intends to solicit, process, receive, or accept an application or agreement for a refund anticipation loan or refund anticipation check transaction or to make, facilitate, or in any manner assist in making a refund anticipation loan or refund anticipation check transaction.

(2) The applicant meets the conditions set forth in division (B)(1) of this section.

(3) The applicant's certificate of registration is not subject to an order of suspension or revocation by the superintendent.

(D) The superintendent shall deposit all application and renewal fees the superintendent receives pursuant to this section into the state treasury to the credit of the consumer finance fund created in section 1321.21 of the Revised Code.

Sec. 1315.64.  (A) Each registrant prominently shall display the certificate of registration issued pursuant to section 1315.63 of the Revised Code and the fee schedule required under division (B) of this section in each place of business in this state where the registrant solicits, processes, receives, or accepts an application or agreement for a refund anticipation loan or refund anticipation check transaction or makes, facilitates, or in any manner assists in making a refund anticipation loan or refund anticipation check transaction.

(B)(1) Each registrant shall prepare a schedule showing the current fees for refund anticipation loans, refund anticipation checks, and electronic filing of a consumer's tax return.

(2) Both of the following shall be included in the portion of the fee schedule relating to refund anticipation loans:

(a) Examples of refund anticipation loan interest rates for refund anticipation loans of two hundred dollars, five hundred dollars, one thousand dollars, one thousand five hundred dollars, two thousand dollars, and five thousand dollars.

(b) In one-inch letters, the following notice:

When you take out a refund anticipation loan, you are borrowing money against your tax refund or tax credits. If the amount of your tax refund or tax credits is less than expected, you still must repay the entire amount of the loan. If the receipt of your tax refund or tax credits is delayed, you may have to pay additional costs. YOU CAN GET YOUR TAX REFUND OR TAX CREDITS IN ABOUT TEN DAYS WITHOUT GETTING A LOAN. You can have your tax return filed electronically and the amount deposited directly into your own bank account without obtaining a loan or paying fees for an extra product."

(3) The fee schedule shall be displayed in not less than twenty-eight-point type on a document measuring not less than sixteen inches by twenty inches.

(C) No registrant shall fail to comply with this section.

Sec. 1315.65. No registrant shall conduct business in this state unless the registrant has obtained and maintains in effect at all times a surety bond issued by a bonding company or insurance company authorized to do business in this state. The bond shall be in favor of the superintendent of financial institutions and in the penal sum of one hundred thousand dollars for each location at which the registrant conducts business. The bond shall continue in effect for at least five years after the registrant ceases operations in this state. The bond shall be for the exclusive benefit of any consumer harmed by a violation of any provision of sections 1315.62 to 1315.68 of the Revised Code.

Sec. 1315.66.  (A) A registrant, including any officer, agent, employee, or representative of the registrant, shall do all of the following in connection with a refund anticipation loan or refund anticipation check transaction:

(1) Promptly inform a consumer applicant for a refund anticipation loan or refund anticipation check if the consumer's application is rejected;

(2) Provide to a consumer applicant, prior to the consummation of the loan or check transaction, both of the following in a form that may be retained by the consumer:

(a) A copy of the completed refund anticipation loan or refund anticipation check application and agreement;

(b) The disclosures, initialed by the consumer, that are required by divisions (B) and (C) of this section, in English and, if other than English, the language in which the refund anticipation loan or refund anticipation check transaction is negotiated.

(3) Provide to a consumer applicant, prior to the consummation of a refund anticipation loan, the disclosures required by the federal "Truth in Lending Act," 15 U.S.C. 1601 (1968), in a form that may be retained by the consumer.

(B) At the time a consumer applies for a refund anticipation loan or refund anticipation check, the registrant shall disclose all of the following to the consumer on a form separate from the application and in fourteen-point type:

(1) The fee for the refund anticipation loan or refund anticipation check;

(2) The fee for electronic filing of a tax return;

(3) The time within which the proceeds of the refund anticipation loan or refund anticipation check will be paid to the consumer if the loan or check transaction is approved.

(C)(1) For a refund anticipation check transaction, the application shall disclose the following in eighteen-point type:

You are paying [enter the amount of the refund anticipation check fee] to get your tax refund or tax credits check through [name of issuer of the refund anticipation check]. YOU CAN AVOID THIS FEE AND STILL RECEIVE YOUR TAX REFUND OR TAX CREDITS CHECK IN ABOUT 10 DAYS BY HAVING THE I.R.S. DIRECTLY DEPOSIT THE AMOUNT INTO YOUR OWN BANK ACCOUNT. You also can wait for the I.R.S. to mail you a check. If you do not have a bank account, you may wish to consider getting one."

(2) For a refund anticipation loan, the application shall disclose both of the following:

(a) In fourteen-point type, the refund anticipation loan interest rate;

(b) In eighteen-point type, the following notice:

This is a loan. This loan is borrowing money against your tax refund or tax credits. If the amount of your tax refund or tax credits is less than expected, you must still repay the entire amount of the loan. If the receipt of your tax refund or tax credits is delayed, you may have to pay additional costs. YOU CAN GET YOUR TAX REFUND OR TAX CREDITS IN ABOUT 10 DAYS WITHOUT GETTING THIS LOAN. You can have your tax return filed electronically and the amount deposited directly into your own bank account without obtaining a loan or other paid product."

(D) Each disclosure required by this section shall be initialed by the consumer applicant.

(E) No registrant shall fail to comply with this section.

Sec. 1315.67.  (A) On or before the first day of July of each year, each registrant shall file an annual report with the superintendent of financial institutions that includes all of the following information for the period beginning on the sixteenth day of April of the prior year and ending on the fifteenth day of April of the current year:

(1) The total number and dollar amount of refund anticipation loans processed by the registrant;

(2) The total number and dollar amount of refund anticipation checks processed by the registrant;

(3) The average and median number of days for which refund anticipation loans processed by the registrant were outstanding before being repaid;

(4) The name and address of any person that takes assignment of refund anticipation loans or refund anticipation check transactions for the registrant;

(5) Any other information required by the superintendent.

(B) Each year, the superintendent shall consolidate the information included in the annual reports submitted under division (A) of this section and make that consolidated information available to the public no later than the first day of September of that year.

(C) No registrant shall fail to comply with division (A) of this section.

Sec. 1315.68.  No registrant, including any officer, agent, employee, or representative of the registrant, shall do any of the following:

(A) Commit an unfair or deceptive act or practice in connection with the business of soliciting, processing, receiving, or accepting an application or agreement for a refund anticipation loan or refund anticipation check transaction, or making, facilitating, or in any manner assisting in making a refund anticipation loan or refund anticipation check transaction, including misrepresenting a factor or condition of the loan or check transaction or making any oral statement contradicting any of the information required to be disclosed under section 1315.64 or 1315.66 of the Revised Code;

(B) Violate or fail to comply with any provision of sections 1315.62 to 1315.68 of the Revised Code;

(C) Threaten to take any action that is prohibited by sections 1315.62 to 1315.68 of the Revised Code or by any other law, or that the person actually does not intend to take;

(D) Solicit, process, receive, or accept an application or agreement for a refund anticipation loan, or make, facilitate, or in any manner assist in making a refund anticipation loan, that has a refund anticipation loan interest rate greater than twenty-eight per cent. Any refund anticipation loan for which the refund anticipation loan interest rate exceeds that amount is void.

(E) Directly or indirectly charge, or arrange for the charging of, any interest, fee, or charge related to a refund anticipation loan or refund anticipation check transaction that is not specifically authorized by sections 1315.61 to 1315.72 of the Revised Code, including charges for insurance, attorney's fees, or other collection costs or charges for check cashing;

(F) Charge a fee for a refund anticipation loan or refund anticipation check transaction that is different than the fee displayed on the fee schedule required under section 1315.64 of the Revised Code;

(G) Include any of the following in any document provided or signed in connection with a refund anticipation loan or refund anticipation check transaction, including the loan application or agreement:

(1) A hold harmless clause;

(2) A confession of judgment clause;

(3) A waiver of the right to a jury trial, if applicable, in any action brought by or against the consumer;

(4) Any assignment of or order for payment of wages or other compensation for services;

(5) A provision in which the consumer agrees not to assert any claim or defense arising out of the contract or not to seek any remedies available under section 1315.71 of the Revised Code;

(6) A waiver of any provision of sections 1315.61 to 1315.72 of the Revised Code. Any such waiver is deemed null, void, and of no effect.

(7) A waiver of the right to injunctive, declaratory, or other equitable relief or relief on a classwide basis;

(8) A provision requiring that any aspect of a resolution of a dispute between the parties to the agreement be kept confidential. Division (G)(8) of this section does not affect the right of the parties to agree that certain specified information is a trade secret or otherwise confidential, or to agree after the dispute arises to keep a resolution confidential.

(H) Take or arrange for a creditor to take a security interest in any property of the consumer other than the proceeds of the consumer's income tax refund or tax credits to secure payment of a refund anticipation loan;

(I) Directly or indirectly, individually or in conjunction or cooperation with another person, engage in the collection of an outstanding or delinquent refund anticipation loan for any creditor or assignee, including soliciting, processing, receiving, or accepting an application or agreement for a refund anticipation loan or refund anticipation check transaction that contains a provision permitting the creditor to repay from the proceeds of the consumer's income tax refund or tax credits, by offset or other means, an outstanding or delinquent refund anticipation loan for that creditor or any creditor;

(J) Facilitate, refer, or solicit consumers on behalf of a third party engaged in check cashing for a fee, or permit third-party check cashing for a fee in any place of business identified in the application for a certificate of registration pursuant to section 1315.63 of the Revised Code;

(K) Facilitate any loan that is secured by or arranged to be repaid directly from the proceeds of the consumer's state income tax refund;

(L) Make a misrepresentation of fact in obtaining or attempting to obtain a certificate of registration under section 1315.63 of the Revised Code;

(M) Engage in any other action prohibited by rules adopted by the superintendent of financial institutions under section 1315.72 of the Revised Code.

Sec. 1315.69.  (A) If the superintendent of financial institutions determines, after notice and opportunity for a hearing conducted in accordance with Chapter 119. of the Revised Code, that a registrant has violated any provision of sections 1315.62 to 1315.68 of the Revised Code, or any rule adopted under section 1315.72 of the Revised Code, the superintendent may do any of the following:

(1) Suspend, revoke, or refuse to renew the certificate of registration;

(2) Impose a fine of one thousand dollars for each violation;

(3) Issue a cease and desist order.

(B) The superintendent has the same authority as described in section 1315.24 of the Revised Code to do any of the following:

(1) Make an investigation or conduct any hearing to determine whether a violation of any provision of sections 1315.62 to 1315.68 of the Revised Code, or any rule adopted under section 1315.72 of the Revised Code, has occurred;

(2) Determine whether a registrant has failed to comply with a cease and desist order issued under division (A) of this section.

(C) If a registrant violates a cease and desist order issued pursuant to division (A) of this section, the superintendent, after notice and opportunity for a hearing conducted in accordance with Chapter 119. of the Revised Code, may impose a fine of one thousand dollars for each violation.

(D) If a person violates section 1315.62 of the Revised Code, the superintendent, after notice and opportunity for a hearing conducted in accordance with Chapter 119. of the Revised Code, may impose a fine of one thousand dollars for each refund anticipation loan or refund anticipation check transaction application or agreement solicited, processed, received, or accepted, or each refund anticipation loan or refund anticipation check transaction made, facilitated, or in any manner assisted by the person.

(E) On January 31, 2009, the amount specified in division (A)(2), (C), and (D) of this section and, on the thirty-first day of January of each year thereafter, any amount computed by adjustments made under this division, shall be adjusted by the average percentage change in the consumer price index for the immediately preceding calendar year, with fractional amounts rounded to the nearest dollar. The superintendent shall make this determination and adjust the amount accordingly. For purposes of this section, "consumer price index" means the consumer price index for all consumers, all items, prepared by the United States department of labor, bureau of labor statistics, or, if that index is no longer published, a generally available comparable index.

Sec. 1315.70.  (A) The superintendent of financial institutions shall establish and maintain a complaint process whereby an aggrieved consumer may file a complaint alleging a violation of any provision of sections 1315.62 to 1315.68 of the Revised Code. Complaints filed in accordance with this section are public records for purposes of section 149.43 of the Revised Code, with exception of the complainant's name, address, or other personal identifying information.

(B) The superintendent shall maintain, and make available upon request, a current list of registrants and shall establish and maintain a toll-free telephone number that consumers may call to obtain information about registrants and complaint forms.

Sec. 1315.71.  (A)(1) A consumer injured by a violation of any provision of sections 1315.62 to 1315.68 of the Revised Code has a cause of action and is entitled to recover all of the following:

(a) The consumer's actual and consequential damages;

(b) Statutory damages in the amount of two thousand dollars, or three times the amount of the refund anticipation loan fee or other unauthorized charge, whichever is greater;

(c) Reasonable attorney's fees and court costs.

(2) On January 31, 2009, the dollar amount specified in division (A)(1)(b) of this section and, on the thirty-first day of January of each year thereafter, any dollar amount computed by adjustments made under division (A)(2) of this section, shall be adjusted by the average percentage change in the consumer price index for the immediately preceding calendar year, with fractional amounts rounded to the nearest dollar. The superintendent shall make this determination and adjust the amount accordingly. For purposes of this section, "consumer price index" means the consumer price index for all consumers, all items, prepared by the United States department of labor, bureau of labor statistics, or, if that index is no longer published, a generally available comparable index.

(B) Any consumer may seek an injunction or other appropriate equitable relief against a violation.

(C) The remedies provided in this section are in addition to any other remedies allowed by law.

Sec. 1315.72.  (A) The superintendent of financial institutions may adopt rules as necessary to effectuate the purpose of sections 1315.61 to 1315.71 of the Revised Code, to provide for the protection of the borrowing public, and to assist registrants in interpreting sections 1315.61 to 1315.71 of the Revised Code.

(B) The superintendent may modify the disclosure required by division (C)(1) and (2)(b) of section 1315.66 of the Revised Code and the fee schedule required to be displayed by division (B)(2)(b) of section 1315.64 of the Revised Code to the extent that a revision of the ten-day estimate for receiving a refund from the internal revenue service is appropriate.

Sec. 1321.21.  All fees, charges, penalties, and forfeitures collected under Chapters 1321., 1322., 4712., 4727., and 4728., sections 1315.21 to 1315.30, sections 1315.35 to 1315.44, sections 1315.61 to 1315.72, and sections 1349.25 to 1349.37 of the Revised Code shall be paid to the superintendent of financial institutions and shall be deposited by the superintendent into the state treasury to the credit of the consumer finance fund, which is hereby created. The fund may be expended or obligated by the superintendent for the defrayment of the costs of administration of Chapters 1321., 1322., 4712., 4727., and 4728., sections 1315.21 to 1315.30, sections 1315.35 to 1315.44, sections 1315.61 to 1315.72, and sections 1349.25 to 1349.37 of the Revised Code by the division of financial institutions. All actual and necessary expenses incurred by the superintendent, including any services rendered by the department of commerce for the division's administration of Chapters 1321., 1322., 4712., 4727., and 4728., sections 1315.21 to 1315.30, sections 1315.35 to 1315.44, sections 1315.61 to 1315.72, and sections 1349.25 to 1349.37 of the Revised Code, shall be paid from the fund. The fund shall be assessed a proportionate share of the administrative costs of the department and the division. The proportionate share of the administrative costs of the division of financial institutions shall be determined in accordance with procedures prescribed by the superintendent and approved by the director of budget and management. Such assessment shall be paid from the consumer finance fund to the division of administration fund or the financial institutions fund.

Section 2. That existing section 1321.21 of the Revised Code is hereby repealed.