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HB166

10RS

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Includes opposite chamber sponsors where requested by primary sponsors of substantially similar bills in both chambers and jointly approved by the Committee on Committees of both chambers. Opposite chamber sponsors are represented in italics.


HB 166 (BR 855) - S. Westrom, R. Damron, T. Thompson

     AN ACT relating to debt adjusting.
     Amend KRS 380.010 to define "debt adjuster," "debtor," "personal information," and "additional interested party," and amend definition of "debt adjusting"; create new sections of KRS Chapter 380 to set forth requirements regarding debt-adjusting contracts, including the requirement that contracts be in writing and signed and dated by the debtor; provide a debtor's right to cancel and set forth provisions relating to cancellation; prohibit the waiver of a debtor's rights; provide for a private right of action for persons entering into debt-adjusting transactions who have suffered loss of money or property, including the right to punitive damages and attorney's fees and costs; require debt adjusters to adhere to stated information security standards; prohibit the sale of debtor's personal information except under permitted circumstances; amend KRS 380.040 to prohibit a debt adjuster from accepting a fee, contribution, or other consideration in advance of complete performance of promised services, to require debt adjuster's to maintain insurance for violations KRS Chapter 380, and to require debt adjusters to maintain a bond or irrevocable letter of credit in the amount of $25,000 in favor of the Attorney General for the benefit of the Commonwealth or any person suffering injury or loss by reason of a violationof KRS Chapter 380; amend KRS 380.990 to allow for imposition of a $5,000 civil penalty for violation of KRS 380.040 and stipulate that violations of KRS Chapter 380 are unfair, false, misleading, or deceptive trade practices, including the ramifications thereof; amend KRS 380.030 to clarify that attorneys admitted to the practice of law in this state by the Kentucky Supreme Court are not to be considered debt adjusters.

HB 166 - AMENDMENTS


     HCS - Retain original provisions except expand the definition of personal information; clarify that a person must receive money or something of value to be engaged in "debt adjusting"; specify that "secured debt" means debt primarily for personal, family, or household use that is secured by a mortgage, deed of trust, other equivalent security interest on residential real property, or collateral that has a mortgage lien interest in real property; enumerate activities in which a debt adjuster may not engage, including misappropriation of funds, settlement requirements, restrictions on powers of attorney, and misrepresentations; specify requirements for agreements for debt adjusting.

     SCS - Retain original provisions, except amend KRS 380.010 to require insurance companies to give notice to the Attorney General at the time of cancellation, nonrenewal, modification or change in insurance coverage; amend KRS 380.040 to increase the insurance amount to $250,000 and to increase the bond amount to $50,000 if a debt adjuster deals with debts secured by a mortgage on a residence; amend KRS 380.030 to exempt creditors when adjusting debts owed to them by the debtor from being debt adjusters; create a new section of KRS Chapter 380 to specify that this Act does not limit financial institutions' abilities to collect debt owed to them by debtors.

     (Prefiled by the sponsor(s).)

     Jan 5-introduced in House; to Banking & Insurance (H)
     Feb 4-posted in committee
     Feb 10-reported favorably, 1st reading, to Consent Calendar with Committee Substitute
     Feb 11-2nd reading, to Rules; posted for passage in the Consent Orders of the Day for Wednesday, February 17, 2010
     Feb 17-3rd reading, passed 98-0 with Committee Substitute
     Feb 18-received in Senate
     Feb 22-to Banking & Insurance (S)
     Mar 16-reported favorably, 1st reading, to Calendar with Committee Substitute
     Mar 17-2nd reading, to Rules
     Mar 24-posted for passage in the Regular Orders of the Day for Thursday, March 25, 2010
     Mar 25-3rd reading, passed 37-0 with Committee Substitute ; received in House; to Rules (H)
     Mar 26-posted for passage for concurrence in Senate Committee Substitute for Monday, March 29, 2010
     Mar 29-House concurred in Senate Committee Substitute ; passed 96-0; enrolled, signed by each presiding officer; delivered to Governor
     Apr 8-signed by Governor (Acts ch. 86)

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