Illinois General Assembly - Full Text of HB3935
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Full Text of HB3935  97th General Assembly




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1    AN ACT concerning regulation.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 5. The Consumer Installment Loan Act is amended by
5changing Section 20 as follows:
6    (205 ILCS 670/20)  (from Ch. 17, par. 5426)
7    Sec. 20. Penalties for violation.
8    (a) Any person who engages in business as a Consumer
9Installment Loan lender without the license required by this
10Act shall be guilty of a Class 4 felony.
11    (b) The obligor, prior to the expiration of 2 years after
12the date of his last scheduled payment, may recover such
13reasonable attorney's fees and court costs as a court may
14assess against such licensee or lender for a violation of
15Sections 1, 12, 15, 15a, 15b, 15d, 15e, 16, 17, 18, or 19.1.
16The balance due under the terms of the loan contract shall be
17reduced by the amount which the obligor is thus entitled to
18recover. A bona fide error by a licensee in calculating charges
19or rebates is not a violation if the licensee corrects the
20error within a reasonable time, after discovery.
21    (b-5) A license issued under this Act may be revoked if the
22licensee, or any directors, managers of a limited liability
23company, partners, or officer thereof is convicted of a felony.



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1    (c) No provision of this Section imposing any liability
2shall apply to any act done or omitted in conformity with any
3rule or regulation or written interpretation thereof by the
4Department of Financial and Professional Regulation, Division
5of Financial Institutions, notwithstanding that after such act
6or omission has occurred, such rule, regulation or
7interpretation is amended, rescinded or determined by judicial
8or other authority to be invalid for any reason. All
9interpretations issued after January 1, 1998 must be written
10and signed by the Department's Chief Counsel and approved by
11the Director.
12    (d) Notwithstanding any other provision of this Section, if
13any person who does not have a license issued under this Act
14makes a loan pursuant to this Act to an Illinois consumer, then
15the loan shall be null and void and the person who made the
16loan shall have no right to collect, receive, or retain any
17principal, interest, or charges related to the loan.
18(Source: P.A. 90-437, eff. 1-1-98.)
19    Section 10. The Payday Loan Reform Act is amended by
20changing Section 4-10 as follows:
21    (815 ILCS 122/4-10)
22    Sec. 4-10. Enforcement and remedies.
23    (a) The remedies provided in this Act are cumulative and
24apply to persons or entities subject to this Act.



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1    (b) Any material violation of this Act, including the
2commission of an act prohibited under Section 4-5, constitutes
3a violation of the Consumer Fraud and Deceptive Business
4Practices Act.
5    (c) If any provision of the written agreement described in
6subsection (b) of Section 2-20 violates this Act, then that
7provision is unenforceable against the consumer.
8    (d) Subject to the Illinois Administrative Procedure Act,
9the Secretary may hold hearings, make findings of fact,
10conclusions of law, issue cease and desist orders, have the
11power to issue fines of up to $10,000 per violation, refer the
12matter to the appropriate law enforcement agency for
13prosecution under this Act, and suspend or revoke a license
14granted under this Act. All proceedings shall be open to the
16    (e) The Secretary may issue a cease and desist order to any
17licensee or other person doing business without the required
18license, when in the opinion of the Secretary the licensee or
19other person is violating or is about to violate any provision
20of this Act or any rule or requirement imposed in writing by
21the Department as a condition of granting any authorization
22permitted by this Act. The cease and desist order permitted by
23this subsection (e) may be issued prior to a hearing.
24    The Secretary shall serve notice of his or her action,
25including, but not limited to, a statement of the reasons for
26the action, either personally or by certified mail, return



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1receipt requested. Service by certified mail shall be deemed
2completed when the notice is deposited in the U.S. Mail.
3    Within 10 days of service of the cease and desist order,
4the licensee or other person may request a hearing in writing.
5The Secretary shall schedule a hearing within 30 days after the
6request for a hearing unless otherwise agreed to by the
8    If it is determined that the Secretary had the authority to
9issue the cease and desist order, he or she may issue such
10orders as may be reasonably necessary to correct, eliminate, or
11remedy the conduct.
12    The powers vested in the Secretary by this subsection (e)
13are additional to any and all other powers and remedies vested
14in the Secretary by law, and nothing in this subsection (e)
15shall be construed as requiring that the Secretary shall employ
16the power conferred in this subsection instead of or as a
17condition precedent to the exercise of any other power or
18remedy vested in the Secretary.
19    (f) The Secretary may, after 10 days notice by registered
20mail to the licensee at the address set forth in the license
21stating the contemplated action and in general the grounds
22therefore, fine the licensee an amount not exceeding $10,000
23per violation, or revoke or suspend any license issued
24hereunder if he or she finds that:
25        (1) the licensee has failed to comply with any
26    provision of this Act or any order, decision, finding,



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1    rule, regulation, or direction of the Secretary lawfully
2    made pursuant to the authority of this Act; or
3        (2) any fact or condition exists which, if it had
4    existed at the time of the original application for the
5    license, clearly would have warranted the Secretary in
6    refusing to issue the license.
7    The Secretary may fine, suspend, or revoke only the
8particular license with respect to which grounds for the fine,
9revocation, or suspension occur or exist, but if the Secretary
10finds that grounds for revocation are of general application to
11all offices or to more than one office of the licensee, the
12Secretary shall fine, suspend, or revoke every license to which
13the grounds apply.
14    No revocation, suspension, or surrender of any license
15shall impair or affect the obligation of any pre-existing
16lawful contract between the licensee and any obligor.
17    The Secretary may issue a new license to a licensee whose
18license has been revoked when facts or conditions which clearly
19would have warranted the Secretary in refusing originally to
20issue the license no longer exist.
21    In every case in which a license is suspended or revoked or
22an application for a license or renewal of a license is denied,
23the Secretary shall serve the licensee with notice of his or
24her action, including a statement of the reasons for his or her
25actions, either personally, or by certified mail, return
26receipt requested. Service by certified mail shall be deemed



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1completed when the notice is deposited in the U.S. Mail.
2    An order assessing a fine, an order revoking or suspending
3a license, or an order denying renewal of a license shall take
4effect upon service of the order unless the licensee requests a
5hearing, in writing, within 10 days after the date of service.
6In the event a hearing is requested, the order shall be stayed
7until a final administrative order is entered.
8    If the licensee requests a hearing, the Secretary shall
9schedule a hearing within 30 days after the request for a
10hearing unless otherwise agreed to by the parties.
11    The hearing shall be held at the time and place designated
12by the Secretary. The Secretary and any administrative law
13judge designated by him or her shall have the power to
14administer oaths and affirmations, subpoena witnesses and
15compel their attendance, take evidence, and require the
16production of books, papers, correspondence, and other records
17or information that he or she considers relevant or material to
18the inquiry.
19    (g) The costs of administrative hearings conducted
20pursuant to this Section shall be paid by the licensee.
21    (h) Notwithstanding any other provision of this Section, if
22a lender who does not have a license issued under this Act
23makes a loan pursuant to this Act to an Illinois consumer, then
24the loan shall be null and void and the lender who made the
25loan shall have no right to collect, receive, or retain any
26principal, interest, or charges related to the loan.



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1(Source: P.A. 94-13, eff. 12-6-05.)
2    Section 99. Effective date. This Act takes effect January
31, 2013.