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90_HB1113eng
205 ILCS 690/1
205 ILCS 690/5
205 ILCS 690/15 new
205 ILCS 690/20 new
205 ILCS 690/25 new
205 ILCS 690/30 new
205 ILCS 690/35 new
205 ILCS 690/36 new
205 ILCS 690/37 new
205 ILCS 690/38 new
205 ILCS 690/39 new
Amends the Check Number Act. Changes the short title to
the Check Printer and Check Number Act. Provides that
persons not affiliated with a financial institution and
engaged in the business of printing checks must register with
the Commissioner of Banks and Real Estate. Requires these
check printers to verify the name, address, telephone number,
and social security number of check purchasers and to refuse
to distribute ordered checks if the information cannot be
verified. Requires these check printers to post a bond.
Creates a civil cause of action for persons damaged by a
check printer's failure to verify. Authorizes minimum
damages of $1,000 plus attorneys' fees. Provides that making
a false statement on the registration form is a Class 3
felony. Effective immediately.
LRB9003071JSgc
HB1113 Engrossed LRB9003071JSgc
1 AN ACT to amend the Check Number Act by changing Sections
2 1 and 5 and adding Sections 15, 20, 22, 25, 30, 35, 36, 37,
3 38, 39, and 40.
4 Be it enacted by the People of the State of Illinois,
5 represented in the General Assembly:
6 Section 5. The Check Number Act is amended by changing
7 Sections 1 and 5 and adding Sections 15, 20, 22, 25, 30, 35,
8 36, 37, 38, 39, and 40 as follows:
9 (205 ILCS 690/1)
10 Sec. 1. Short title. This Act may be cited as the Check
11 Printer and Check Number Act.
12 (Source: P.A. 87-1143.)
13 (205 ILCS 690/5)
14 Sec. 5. Definitions. For the purposes of this Act:
15 "Commissioner" means the Commissioner of Banks and Real
16 Estate.
17 "Consumer-deposit account" means a demand or other
18 similar deposit account such as a checking, negotiable order
19 of withdrawal, money market, savings deposit, share, or
20 member account established and maintained by a natural person
21 with a financial institution and operated primarily for
22 personal, family, or household purposes.
23 "Financial institution" means (i) any bank subject to the
24 Illinois Banking Act, any savings bank subject to the Savings
25 Bank Act, any savings and loan association subject to the
26 Illinois Savings and Loan Act of 1985, or any credit union
27 subject to the Illinois Credit Union Act; (ii) and any
28 federally chartered commercial bank, savings bank, or savings
29 and loan association, or credit union organized and operated
30 in this State under the laws of the United States; and (iii)
HB1113 Engrossed -2- LRB9003071JSgc
1 any business corporation, limited liability company, business
2 trust, partnership, joint venture, or other entity that is
3 directly or indirectly at least 50% owned by or commonly
4 owned with a financial institution.
5 "Check" means a writing that complies with the
6 requirements of Section 3-104 of the Uniform Commercial Code.
7 "Material change" means any change or addition to any
8 part of a check drawn on a consumer-deposit account
9 pertaining to the account holder's name, address, city,
10 state, or account number.
11 "New order" means an order for checks to be drawn on a
12 new or existing consumer-deposit account which has not been
13 previously fulfilled by a financial institution or by a
14 person fulfilling a check order on behalf of a financial
15 institution or by a person selling or distributing checks
16 registered with the Commissioner under this amendatory Act of
17 1997.
18 "Reorder" means an order for checks to be drawn on an
19 existing consumer-deposit account for which a check order has
20 been previously fulfilled by the person selling or
21 distributing checks.
22 "Person" means any natural person or his legal
23 representative, partnership, corporation, company, trust,
24 business entity, or association.
25 "Verification" means that the financial institution
26 maintaining the consumer-deposit account on which the checks
27 will be drawn is contacted by the seller or distributor of
28 the checks inquiring about the accuracy of a material change
29 or changes requested on any new order or reorder or that the
30 check seller or distributor has obtained acceptable
31 documentation from the person ordering the checks as provided
32 in Section 15.
33 (Source: P.A. 87-1143.)
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1 (205 ILCS 690/15 new)
2 Sec 15. Verification of check purchasers.
3 (a) A person, other than a financial institution or a
4 person fulfilling check orders on behalf of a financial
5 institution or a person fulfilling check orders under an
6 existing contract, who sells or distributes checks that may
7 be drawn against funds held by a financial institution in a
8 consumer-deposit account shall, before delivery of checks
9 constituting (i) a new order or (ii) a reorder containing a
10 material change or changes, obtain documentation from the
11 person ordering the checks verifying the accuracy of that
12 person's account number, name, and address including city and
13 state. Acceptable forms of documentation under this
14 subsection (a) shall include a copy of the person's account
15 signature card from the financial institution, account
16 agreement with the financial institution, account statement
17 issued by the financial institution, letter or verbal
18 response from the financial institution verifying the account
19 information, or a copy of the signed Magnetic Ink Character
20 Recognition specification sheet from the financial
21 institution.
22 (b) A person, other than a financial institution or a
23 person fulfilling check orders on behalf of a financial
24 institution or a person fulfilling check orders under an
25 existing contract, who sells or distributes checks that may
26 be drawn against funds held by a financial institution in a
27 consumer-deposit account shall before delivery of checks
28 constituting a reorder containing no material change, verify
29 the accuracy of the reorder by clearing the check written on
30 the same consumer-deposit account of the reorder presented
31 for payment for the reorder or obtaining an authorized credit
32 card transaction for payment for the reorder.
33 (c) The sale or distribution of checks by any person who
34 has not first obtained verification as required under this
HB1113 Engrossed -4- LRB9003071JSgc
1 Section shall constitute a business offense for which the
2 fine shall be $1,000 for each offense.
3 (205 ILCS 690/20 new)
4 Sec. 20. Registration. A person, other than a financial
5 institution or a person fulfilling check orders on behalf of
6 a financial institution or person fulfilling check orders
7 under an existing contract, who sells or distributes checks
8 that may be drawn against funds held by a financial
9 institution in a consumer-deposit account shall register with
10 and pay a fee of $50 annually to the Commissioner no later
11 than January 15, 1998 and every January 15 thereafter or
12 within 30 days after commencement of doing business in this
13 State. The person shall register on forms provided by the
14 Commissioner that require the name of the business as
15 incorporated, state, and date of incorporation, address of
16 the person's principal place of business, telephone number,
17 and name of the principal contact of the registrant. If the
18 principal contact changes for any reason, it shall be the
19 responsibility of the registrant to notify the Commissioner.
20 (205 ILCS690/22 new)
21 Sec. 22. Fees. All moneys received by the Commissioner
22 under this Act shall be paid into, and all expenses incurred
23 by the Commissioner under this Act shall be paid from, the
24 Bank and Trust Company Fund.
25 (205 ILCS 690/25 new)
26 Sec. 25. Bond; conditions; amount. At the time of each
27 registration, the registrant shall file with, and have
28 approved by, the Commissioner a surety bond issued by a
29 bonding company authorized to do business in this State in
30 the principal sum of $10,000. The bond shall run to the
31 Commissioner and shall be for any liability incurred by the
HB1113 Engrossed -5- LRB9003071JSgc
1 registrant for any violation of this Act, including damages
2 awarded in actions brought pursuant to Section 35.
3 From time to time, the Commissioner may determine the
4 amount of liabilities as described herein and may require the
5 registrant to file a bond in an additional sum if it is
6 determined to be necessary in accordance with the
7 requirements of this Section. In no case shall the bond be
8 less than the initial $10,000, nor more than the outstanding
9 liabilities if in excess of $10,000.
10 (205 ILCS 690/30 new)
11 Sec. 30. Civil action. When the Commissioner believes a
12 person has violated or is violating this Act or a rule
13 prescribed under this Act, the Commissioner may request the
14 Attorney General to bring a civil action in circuit court to
15 enjoin the violation or enforce compliance with this Act or a
16 rule prescribed under this Act. A person not complying with
17 an injunction issued under this Section is liable to the
18 State of Illinois in a civil suit for an amount of not more
19 than $10,000.
20 (205 ILCS 690/35 new)
21 Sec. 35. Recovery of damages. A person who is damaged
22 by reason of the registrant's failure to verify as required
23 under this Act may sue such person for damages including, at
24 a minimum, liquidated damages in the amount of $1,000, plus
25 all costs and expenses, including reasonable attorneys' fees,
26 incurred in the prosecution of the action.
27 (205 ILCS 690/36 new)
28 Sec. 36. Criminal penalties. A person who willfully and
29 knowingly subscribes to or makes, or causes to be made, any
30 false statement on the registration form with intent to
31 deceive the Commissioner or his administrative officers
HB1113 Engrossed -6- LRB9003071JSgc
1 shall, upon conviction thereof, be guilty of a Class 3
2 felony.
3 (205 ILCS 690/37 new)
4 Sec. 37. Record retention. Records pertaining to or
5 constituting the procedures for and results of the
6 verification required under this Act shall be retained for a
7 period of 18 months from the date of receipt of the
8 information.
9 (205 ILCS 690/38 new)
10 Sec. 38. Rules. The Commissioner has the power to
11 promulgate reasonable rules for the purpose of administering
12 the provisions of this Act.
13 (205 ILCS 690/39 new)
14 Sec. 39. Severability. The provisions of this Act are
15 severable under Section 1.31 of the Statute on Statutes.
16 (205 ILCS 690/40 new)
17 Sec. 40. Conflicts. In the event of a conflict between
18 this Act and Article 3 of the Uniform Commercial Code,
19 Article 3 of the Uniform Commercial Code shall control.