State Regulation:
Oklahoma
OK ST T. 24 § 131
Chapter 8. Credit Services Organization Act
§ 131. Short title
This act [FN1] shall be known and may be cited as the
"Credit Services Organization Act".
[FN1] Title 24, § 131 et seq.
§ 132. Definitions
As used in the Credit Services Organization Act:
1. "Buyer" means any individual who is solicited to purchase
or who purchases the services of a credit services
organization;
2. a. "Credit services organization" means any person who,
with respect to the extension of credit by others, sells,
provides, performs, or represents that the person can or
will sell, provide, or perform, in return for the payment of
money or other valuable consideration from any source, any
of the following services more than twelve times in a
calendar year:
(1) improving a buyer's credit record, history, or rating,
(2) obtaining an extension of credit for a buyer, or
(3) providing advice or assistance to a buyer with regard to
division (1) or (2) of this subparagraph,
b. "Credit services organization" does not include:
(1) any person authorized to make loans or extensions of
credit under the laws of this state or the United States who
is subject to regulation and supervision by this state or
the United States or a lender approved by the United States
Secretary of Housing and Urban Development for participation
in any mortgage insurance program under the National Housing
Act, [FN1]
(2) any bank, savings and loan institution or credit union
whose deposits or accounts are eligible for insurance by the
Federal Deposit Insurance Corporation, the Federal Savings
and Loan Insurance Corporation, or the National Credit Union
Administration or a subsidiary of such bank, savings and
loan institution or credit union,
(3) any nonprofit organization exempt from taxation under
Section 501(c)(3) of the Internal Revenue Code, [FN2]
(4) any person licensed as a real estate broker by this
state if the person is acting within the course and scope of
that license,
(5) any person licensed to practice law in this state if the
person renders services within the course and scope of the
practice of the person as an attorney,
(6) any broker-dealer registered with the Securities and
Exchange Commission or the Commodity Futures Trading
Commission if the broker-dealer is acting within the course
and scope of that regulation,
(7) any consumer reporting agency as defined in the Federal
Fair Credit Reporting Act, 15 U.S.C., Sections 1681 through
1681t,
(8) any person authorized to file electronic income tax
returns who does not receive any consideration for refund
anticipation loans,
(9) any residential mortgage broker as defined in the
Mortgage Broker Licensure Act, [FN3] or
(10) any insurance company, its affiliates and subsidiaries,
authorized to do business in this state by the Insurance
Commissioner, including insurance agents licensed in this
state;
3. "Extension of credit" means the right to defer payment of
debt or to incur debt and defer its payment offered or
granted primarily for personal, family, or household
purposes, or to anyone whose principal occupation is
agricultural in nature; and
4. "Administrator" means the Administrator of the Department
of Consumer Credit.
[FN1] 12 U.S.C.A § 1701 et seq.
[FN2] 26 U.S.C.A. § 501(c)(3).
[FN3] Title 59, § 2081 et seq.
§ 133. Restrictions
A credit services organization, its salespersons, agents,
and representatives, and independent contractors who sell or
attempt to sell the services of a credit services
organization may not do any of the following:
1. Charge or receive any money or other valuable
consideration prior to full and complete performance of the
services the credit services organization has agreed to
perform for the buyer, unless the credit services
organization has obtained a surety bond of Ten Thousand
Dollars ($10,000.00) issued by a surety company admitted to
do business in this state and established a trust account at
a federally insured bank or savings and loan association
located in this state;
2. Charge or receive any money or other valuable
consideration solely for referral of the buyer to a retail
seller who will or may extend credit to the buyer if the
credit that is or will be extended to the buyer is upon
substantially the same terms as those available to the
general public;
3. Make or counsel or advise any buyer to make any statement
that is untrue or misleading or that should be known by the
exercise of reasonable care to be untrue or misleading, to a
credit reporting agency or to any person who has extended
credit to a buyer or to whom a buyer is applying for an
extension of credit with respect to a buyer's credit
worthiness, credit standing, or credit capacity; or
4. Make or use any untrue or misleading representations in
the offer or sale of the services of a credit services
organization or engage, directly or indirectly, in any act,
practice, or course of business that operates or would
operate as fraud or deception upon any person in connection
with the offer or sale of the services of a credit services
organization.
§ 134. Exemption from bond and trust account
provisions--Responsibility for employees or agents
If a credit services organization is in compliance with
paragraph 1 of Section 3 of this act, [FN1] the salesperson,
agent, or representative who sells the services of that
organization is not required to obtain a surety bond and
establish a trust account. Provided, however, said
organization or entity shall be responsible for the acts of
their employees or agents performed within the scope of
their employment.
[FN1] Title 24, § 133.
§ 135. Information statement--Written statement required
Before the execution of a contract or agreement between the
buyer and a credit services organization or before the
receipt by the credit services organization of any money or
other valuable consideration, whichever occurs first, the
credit services organization shall provide the buyer with a
statement, in writing, containing all the information
required by Section 6 of this act. [FN1] The credit services
organization shall maintain on file for a period of two (2)
years an exact copy of the statement, personally signed by
the buyer, acknowledging receipt of a copy of the statement.
[FN1] Title 24, § 136.
§ 136. Information statement--Contents
The information statement required pursuant to Section 5 of
this act [FN1] shall include all of the following:
1. a. a complete and accurate statement of the buyer's right
to review any file on the buyer maintained by any consumer
reporting agency, as provided under the Federal Fair Credit
Reporting Act, 15 U.S.C., Sections 1681 through 1681t,
b. a statement that the buyer may review his or her consumer
reporting agency file at no charge if a request is made to
the consumer credit reporting agency within thirty (30) days
after receiving notice that credit has been denied, and
c. the approximate price the buyer will be charged by the
consumer reporting agency to review his or her consumer
reporting agency file;
2. A complete and accurate statement of the buyer's right to
dispute the completeness or accuracy of any item contained
in any file on the buyer maintained by any consumer
reporting agency;
3. A complete and detailed description of the services to be
performed by the credit services organization for the buyer
and the total amount the buyer will have to pay, or become
obligated to pay, for the services;
4. A statement asserting the buyer's right to proceed
against the bond or trust account required under Section 3
of this act; [FN2] and
5. The name and address of the surety company that issued
the bond, or the name and address of the depository and the
trustee and the account number of the trust account.
[FN1] Title 24, § 135.
[FN2] Title 24, § 133.
§ 137. Contracts--Contents--Form for "Notice of
Cancellation"--Copies
A. Each contract between the buyer and a credit services
organization for the purchase of the services of the credit
services organization shall be in writing, dated, signed by
the buyer, and include the following:
1. A conspicuous statement in bold face type, in immediate
proximity to the space reserved for the signature of the
buyer, as follows: "You, the buyer, may cancel this contract
at any time prior to midnight of the fifth day after the
date of the transaction. See the attached notice of
cancellation form for an explanation of this right";
2. The terms and conditions of payment, including the total
of all payments to be made by the buyer, whether to the
credit services organization or to some other person;
3. A full and detailed description of the services to be
performed by the credit services organization for the buyer,
including all guarantees and all promises of full or partial
refunds, and the estimated date by which the services are to
be performed, or estimated length of time for performing the
services; and
4. The credit services organization's principal business
address which shall be the actual office location of the
organization and the name and address of its agent in the
state authorized to receive service of process.
B. The contract shall be accompanied by a completed form in
duplicate, captioned "Notice of Cancellation" that shall be
attached to the contract, be easily detachable, and contain
in bold face type the following statement written in the
same language as used in the contract:
"Notice of Cancellation
You may cancel this contract, without any penalty or
obligation, within five (5) days from the date the contract
is signed.
If you cancel any payment made by you under this contract,
it will be returned within ten (10) days following receipt
by the seller of your cancellation notice.
To cancel this contract, mail or deliver a signed dated copy
of this cancellation notice, or any other written notice to
__________(name of seller) at __________(address of seller)
__________(place of business) not later than midnight
__________(date)
I hereby cancel this transaction,
__________(date)
__________(purchaser's signature)"
C. The credit services organization shall give to the buyer
a copy of the completed contract and all other documents the
credit services organization requires the buyer to sign at
the time they are signed.
§ 138. Waivers--Burden of proof--Violations and
jurisdiction--Enforcement of rights
A. Any waiver by a buyer of any part of this act is void.
Any attempt by a credit services organization to have a
buyer waive rights given by this act is a violation of this
act.
B. In any proceeding involving this act, the burden of
proving an exemption or an exception from a definition is
upon the person claiming it.
C. Any person who violates this act is guilty of a
misdemeanor. Any district court of this state has
jurisdiction in equity to restrain and enjoin the violation
of this act.
D. This section does not prohibit the enforcement by any
person of any right provided by this or any other law.
§ 139. Action for damages--Remedies not exclusive
A. Any buyer injured by a violation of this act may bring
any action for recovery of damages. Judgment shall be
entered for actual damages, but in no case less than the
amount paid by the buyer to the credit services
organization, plus reasonable attorney's fees and costs. An
award may also be entered for punitive damages.
B. The remedies provided under this act are in addition to
any other procedures or remedies for any violation or
conduct provided for in any other law.
§ 140. Rules and regulations
The Department of Consumer Credit shall administer and
promulgate rules and regulations to implement the provisions
of this act.
§ 141. License required--Extensions of credit in compliance
with law
No person shall engage in business as a credit service
organization without first obtaining a license from the
Administrator pursuant to the provisions of the Credit
Services Organization Act. Any extensions of credit brokered
or arranged on behalf of a buyer by a credit service
organization must comply with the provisions of the Uniform
Consumer Credit Code [FN1] and the Credit Services
Organization Act.
[FN1] Title 14A, § 1-101 et seq.
§ 142. Application for license--Resident agent
A. Applications for a credit service organization license
shall be under oath and shall state the full name and place
of residence of the applicant. If the applicant is a
partnership, the full name and place of residence of each
member thereof shall be stated. If the applicant is a
corporation, the full name and place of residence of each
officer or major stockholder thereof shall be stated. The
application shall give the approximate location from which
the business is to be conducted, and shall contain such
relevant information as the Administrator may require.
B. Each licensee shall maintain on file with the
Administrator a written appointment of a resident of this
state as his agent for service of all judicial or other
process or legal notice, unless the licensee has appointed
an agent pursuant to another statute of this state. In case
of noncompliance with the provision of this section, such
service may be made on the Administrator on behalf of the
licensee.
§ 143. Fees--Administrator's investigation--Issuance or
denial of license
A. Upon the filing of an application and bond, payment of
the annual license fee of One Hundred Dollars ($100.00), and
an investigation fee of One Hundred Dollars ($100.00), the
Administrator shall conduct an investigation. If the
Administrator finds that the financial responsibility,
experience, character and general fitness of the applicant
are such as to warrant belief that the business will be
operated pursuant to the Credit Services Organization Act
[FN1] and rules promulgated pursuant thereto, the
Administrator shall grant the application and issue to the
applicant a license which will evidence his authority to do
business under the provisions of the Credit Services
Organization Act.
B. If the Administrator does not so find facts sufficient to
warrant issuance of a license, he shall notify the
applicant. If within thirty (30) days of such notification
the applicant requests a hearing on the application, a
hearing shall be held within sixty (60) days after the date
of the request. In the event of the denial of a license, the
investigation fee shall be retained by the Administrator,
but the annual license fee shall be returned to the
applicant.
C. The Administrator shall grant or deny such application
for license within sixty (60) days from its filing with the
required fees, or from the hearing thereon, if any, unless
the period is extended by written agreement between the
applicant and the Administrator.
D. No license to engage in the business of a credit services
organization shall be issued for any location if a license
has been issued and is in effect under the provisions of
Sections 3-501 through 3-514 of Title 14A of the Oklahoma
Statutes. As used in this subsection the term "location"
means the entire area in which a person licensed pursuant to
any provision of Title 14A of the Oklahoma Statutes conducts
business. No credit service organization may be connected
with any location in which a person licensed pursuant to any
provision of Title 14A of the Oklahoma Statutes conducts
business, except by a passageway to which the public is not
admitted.
[FN1] Title 24, § 131 et seq.
§ 144. Licenses--Contents--Display--Number--Term--Annual fee
A. Each license shall state the name of the license and the
address of which the business is to be conducted. The
license shall be displayed at the place of business named in
the license. The license shall not be transferable or
assignable except upon approval by the Administrator.
B. A separate license shall be required for each credit
service organization operated pursuant to the Credit
Services Organization Act. [FN1]
The Administrator may issue more than one license to any one
person upon compliance with the provisions of the Credit
Services Organization Act as to each license. A licensee
desiring to move his credit service operation to another
location shall give thirty (30) days' written notice to the
Administrator, who shall amend the license accordingly.
C. Each license shall remain in full force and effect until
relinquished, suspended, revoked or expired. Every licensee,
on or before December 1 of each year, shall pay the
Administrator One Hundred Dollars ($100.00) for each license
held by him as the annual fee for the succeeding calendar
year. If the annual fee remains unpaid fifteen (15) days
after written notice of delinquency has been given to the
licensee by the Administrator, the license shall thereupon
expire, but expiration shall not occur before December 31 of
any year for which an annual fee has been paid.
[FN1] Title 24, § 131 et seq.
§ 145. Suspension, revocation or surrender of license
A. The Administrator may, after notice and hearing, suspend
or revoke any license if he finds that:
1. The licensee has failed to pay any fee or charge properly
imposed by the Administrator under the authority of the
Credit Services Organization Act: [FN1]
2. The licensee, either knowingly or without the exercise of
due care to prevent the same, has violated any provisions of
the Credit Services Organization Act or any regulation or
order lawfully made pursuant thereto; or
3. Any fact or condition exists which, if it had existed or
had been known to exist at the time of the original
application for a license, clearly would have justified the
Administrator in refusing the license.
B. The hearing shall be held upon twenty (20) days' notice
in writing, setting forth the time and place thereof and a
concise statement of the facts alleged to warrant suspension
or revocation. At the conclusion of the hearing, the
Administrator shall prepare a written order setting forth
the effective date of any suspension or revocation
accompanied by findings of fact and a copy thereof shall be
forthwith delivered to the licensee. Such order, findings
and the evidence considered by the Administrator shall be
filed with the public records of the Administrator.
C. Any licensee may surrender any license by delivering it
to the Administrator with written notice of its surrender,
but such surrender shall not affect the licensee's civil or
criminal liability for acts committed prior thereto.
D. No revocation, suspension or surrender of any license
shall impair or affect the obligation of any preexisting
lawful contract between the licensee and any customer.
E. The Administrator may reinstate suspended licenses or
issue new licenses to a person whose license or licenses
have been revoked if no fact or condition then exists which
clearly would have justified the Administrator in refusing
originally to issue such license pursuant to the Credit
Services Organization Act.
F. On application of any person and payment of the cost
thereof, the Administrator shall furnish under his seal and
signature a certificate of good standing or a certified copy
of any license.
[FN1] Title 24, § 131 et seq.
§ 146. Investigation and examination of books and records
A. At such times as the Administrator may deem necessary,
the Administrator or his duly authorized representative may
make an examination of the place of business of each
licensee and may inquire into and examine the transactions,
books, accounts, papers, correspondence and records of such
licensee insofar as they pertain to the business regulated
by the Credit Services Organization Act. [FN1] Such books,
accounts, papers, correspondence and records shall also be
open for inspection at any reasonable time by any peace
officer, without any need of judicial writ or other process.
In the course of an examination, the Administrator or his
duly authorized representative shall have free access to the
office, place of business, files, safes and vaults of such
licensee, and shall have the right to make copies of any
books, accounts, papers, correspondence and records. The
Administrator or his duly authorized representative, during
the course of such examination, may administer oaths and
examine any person under oath upon any subject pertinent to
any matter about which the Administrator is authorized or
required by the Credit Services Organization Act to
consider, investigate or secure information. Any licensee
who fails or refuses to permit the Administrator or his duly
authorized representative to examine or make copies of such
books or other relevant documents shall be deemed to be in
violation of the Credit Services Organization Act and such
failure or refusal shall constitute grounds for the
suspension or revocation of such license. The information
obtained in the course of any examination or inspection
shall be confidential, except in civil or administrative
proceedings conducted by the Administrator, or criminal
proceedings instituted by the state. Each licensee shall pay
to the Administrator an amount assessed by the Administrator
to cover the direct or indirect cost of such examination,
not to exceed Two Hundred Dollars ($200.00) in any calendar
year.
B. For the purpose of discovering violations of the Credit
Services Organization Act or of securing information
required by the Credit Services Organization Act, the
Administrator or his duly authorized representative may
investigate the books, accounts, papers, correspondence and
records of any licensee or other person who the
Administrator has reasonable cause to believe is violating
any provision of the Credit Services Organization Act
whether or not such person shall claim to be within the
authority or scope of the Credit Services Organization Act.
C. Each licensee shall keep or make available in this state
such books and records relating to credit service
transactions made pursuant to the Credit Services
Organization Act as are necessary to enable the
Administrator to determine whether the licensee is complying
with the Credit Services Organization Act. Such books and
records shall be consistent with accepted accounting
practices.
D. Each licensee shall preserve or make available such books
and records in this state relating to each of its credit
service transactions for four (4) years from the date of the
transaction, or two (2) years from the date of the final
entry made thereon, whichever is later. Each licensee's
system of records shall be accepted if it discloses such
information as may be reasonably required pursuant to the
Credit Services Organization Act. All agreements signed by
customers shall be kept at an office in this state
designated by the licensee, except when transferred under an
agreement which gives the Administrator access thereto.
E. Each licensee, annually on or before the first day of May
or other date thereafter fixed by the Administrator, shall
file a report with the Administrator setting forth such
relevant information as the Administrator may reasonably
require concerning the business and operations during the
preceding calendar year for each licensed place of business
conducted by such licensee within the state. Such report
shall be made under oath and shall be in the form prescribed
by the Administrator, who may make and publish annually a
consolidated analysis and recapitulation of such reports,
but the individual reports shall be held confidential.
[FN1] Title 24, § 131 et seq.
§ 147. Disclosures to consumer--Applicability of disclosure
requirements-- Credit histories--Fees
A. Every consumer reporting agency shall, upon request and
proper identification of any consumer, clearly and
accurately disclose to the consumer:
1. The nature and substance of all information, except
medical information, in its files on the consumer at the
time of the request;
2. The sources of the information, except that the sources
of information acquired solely for use in preparing an
investigative consumer report and actually used for no other
purpose need not be disclosed. Provided, in the event an
action is brought under this act, such sources shall be
available to the plaintiff under appropriate discovery
procedures in the court in which the action is brought; and
3. The recipients of any consumer report on the consumer
which it has furnished:
a. for employment purposes within the two-year period
preceding the request, and
b. for any other purpose within the six-month period
preceding the request.
B. The requirements of subsection A of this section
respecting the disclosure of sources of information and the
recipients of consumer reports do not apply to information
received or consumer reports furnished prior to the
effective date of this act, except to the extent that the
matter involved is contained in the files of the consumer
reporting agency on that date.
C. All consumer reporting agencies, as such agencies are
defined in the Federal Fair Credit Reporting Act, 15 U.S.C.,
Sections 1681 through 1681t, which operate offices in the
State of Oklahoma shall allow any requesting person to
receive his or her credit history.
D. A consumer reporting agency shall make all disclosures
and furnish all consumer reports without charge to the
consumer if requested within thirty (30) days after receipt
by such consumer of a notification from a debt collection
agency affiliated with such consumer reporting agency
stating that the consumer's credit rating may be or has been
adversely affected. Otherwise, the consumer reporting agency
may impose a reasonable charge on the consumer:
1. For making disclosure to such consumer, the charge for
which shall be indicated to the consumer prior to making
disclosure; and
2. For furnishing credit histories authorized in subsection
C of this section, notifications, statements, summaries or
codifications to persons designated by the consumer, the
charge for which shall be indicated to the consumer prior to
furnishing such information.
Provided, no charge may be made for notifying such persons
of the deletion of information which is found to be
inaccurate or which can no longer be verified.
§ 148. Request of consumer report--Notice to subject of
report
A. Prior to requesting a consumer report for employment
purposes, the requestor or user of the consumer report shall
provide written notice to the person who is the subject of
the consumer report. The notice shall inform the consumer
that a consumer report will be used and the notice shall
contain a box that the consumer may check to receive a copy
of the consumer report. If the consumer requests a copy of
the report, the user of the consumer report shall request
that a copy be provided to the consumer when the user of the
consumer report requests its copy from the credit reporting
agency. The report sent to the consumer shall be provided at
no charge to the consumer. As used in this section,
"consumer report" shall have the same meaning as that term
is defined in the federal Fair Credit Reporting Act, 15
U.S.C., Sections 1681 et seq.
B. No person shall be held liable for any violation of this
section if such person shows by a preponderance of the
evidence that, at the time of the alleged violation, such
person maintained reasonable procedures to assure compliance
with this section.
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