AB218,31,11 11       Date
AB218,31,1812 (c) If a personal financial emergency necessitates the disbursement of an
13individual's money to one or more of the individual's creditors before the expiration
14of 3 days after an agreement is signed, an individual may waive the right to cancel.
15To waive the right, the individual must send or deliver a signed, dated statement in
16the individual's own words describing the circumstances that necessitate a waiver.
17The waiver must explicitly waive the right to cancel. A waiver by means of a
18standard-form record is void.
AB218,31,23 19(20) Required language. Unless the division, by rule, provides otherwise, the
20disclosures and documents required by this section must be in English. If a provider
21communicates with an individual primarily in a language other than English, the
22provider must furnish a translation into the other language of the disclosures and
23documents required by this section.
AB218,32,3 24(21) Trust account. (a) All money paid to a provider by or on behalf of an
25individual pursuant to a plan for distribution to creditors is held in trust. Within 2

1business days after receipt, the provider shall deposit the money in a trust account
2established for the benefit of individuals to whom the provider is furnishing
3debt-management services.
AB218,32,74 (b) Money held in trust by a provider is not property of the provider or its
5designee. The money is not available to creditors of the provider or designee, except
6an individual from whom or on whose behalf the provider received money, to the
7extent that the money has not been disbursed to creditors of the individual.
AB218,32,88 (c) A provider shall do all of the following:
AB218,32,109 1. Maintain separate records of account for each individual to whom the
10provider is furnishing debt-management services.
AB218,32,1211 2. Disburse money paid by or on behalf of the individual to creditors of the
12individual as disclosed in the agreement, except that all of the following apply:
AB218,32,1413 a. The provider may delay payment to the extent that a payment by the
14individual is not final.
AB218,32,1615 b. If a plan provides for regular periodic payments to creditors, the
16disbursement must comply with the due dates established by each creditor.
AB218,32,2017 3. Promptly correct any payments that are not made or that are misdirected
18as a result of an error by the provider or other person in control of the trust account
19and reimburse the individual for any costs or fees imposed by a creditor as a result
20of the failure to pay or misdirection.
AB218,32,2321 (d) A provider may not commingle money in a trust account established for the
22benefit of individuals to whom the provider is furnishing debt-management services
23with money of other persons.
AB218,32,2524 (e) A trust account must at all times have a cash balance equal to or greater
25than the sum of the positive balances of each individual's account.
AB218,33,5
1(f) If a provider has established a trust account pursuant to par. (a), the
2provider shall reconcile the trust account at least once a month. The reconciliation
3must compare the cash balance in the trust account with the sum of the balances in
4each individual's account. If the provider or its designee has more than one trust
5account, each trust account must be individually reconciled.
AB218,33,106 (g) If a provider discovers, or has a reasonable suspicion of, embezzlement or
7other unlawful appropriation of money held in trust, the provider immediately shall
8notify the division by a method approved by the division. Unless the division by rule
9provides otherwise, within 5 days thereafter, the provider shall give notice to the
10division describing the remedial action taken or to be taken.
AB218,33,1411 (h) If an individual terminates an agreement or it becomes reasonably
12apparent to a provider that a plan has failed, the provider shall promptly refund to
13the individual all money paid by or on behalf of the individual which has not been
14paid to creditors, less fees that are payable to the provider under sub. (22).
AB218,33,1915 (i) Before relocating a trust account from one financial institution to another,
16a provider shall inform the division of the name, business address, and telephone
17number of the new financial institution. As soon as practicable, the provider shall
18inform the administrator of the account number of the trust account at the new
19financial institution.
AB218,33,23 20(22) Fees and other charges. (a) A provider may not impose directly or
21indirectly a fee or other charge on an individual or receive money from or on behalf
22of an individual for debt-management services except as permitted by this
23subsection.
AB218,34,3
1(b) A provider may not impose charges or receive payment for
2debt-management services until the provider and the individual have signed an
3agreement that complies with subs. (18) and (27).
AB218,34,84 (c) If an individual assents to an agreement, a provider may not impose a fee
5or other charge for educational or counseling services, or the like, except as otherwise
6provided in this subsection and sub. (27) (d). The division may authorize a provider
7to charge a fee based on the nature and extent of the educational or counseling
8services furnished by the provider.
AB218,34,109 (d) Subject to adjustment of dollar amounts pursuant to sub. (31) (f), all of the
10following rules apply:
AB218,34,1311 1. If an individual assents to a plan that contemplates that creditors will reduce
12finance charges or fees for late payment, default, or delinquency, the provider may
13charge all of the following:
AB218,34,1514 a. A fee not exceeding $50 for consultation, obtaining a credit report, setting
15up an account, and the like.
AB218,34,1816 b. A monthly service fee, not to exceed $10 times the number of creditors
17remaining in a plan at the time the fee is assessed, but not more than $50 in any
18month.
AB218,34,2119 2. If an individual assents to a plan that contemplates that creditors will settle
20debts for less than the principal amount of the debt, a provider may charge all of the
21following:
AB218,34,2422 a. Subject to sub. sub. (18) (d), a fee for consultation, obtaining a credit report,
23setting up an account, and the like, in an amount not exceeding the lesser of $400 and
244 percent of the debt in the plan at the inception of the plan.
AB218,35,3
1b. A monthly service fee, not to exceed $10 times the number of creditors
2remaining in a plan at the time the fee is assessed, but not more than $50 in any
3month.
AB218,35,44 3. A provider may not impose or receive fees under both subds. 1. and 2.
AB218,35,95 4. Except as otherwise provided in sub. (27) (d), if an individual does not assent
6to an agreement, a provider may receive for educational and counseling services it
7provides to the individual a fee not exceeding $100 or, with the approval of the
8division, a larger fee. The division may approve a fee larger than $100 if the nature
9and extent of the educational and counseling services warrant the larger fee.
AB218,35,1210 (e) If, before the expiration of 90 days after the completion or termination of
11educational or counseling services, an individual assents to an agreement, the
12provider shall refund to the individual any fee paid pursuant to par. (d) 4.
AB218,35,1813 (f) Except as otherwise provided in pars. (c) and (d), if a plan contemplates that
14creditors will settle an individual's debts for less than the principal amount of the
15debt, compensation for services in connection with settling a debt may not exceed,
16with respect to each debt, 30 percent of the excess of the principal amount of the debt
17over the amount paid the creditor pursuant to the plan, less the sum of the following,
18to the extent it has not been credited against an earlier settlement fee:
AB218,35,1919 1. The fee charged pursuant to par. (d) 2. a.
AB218,35,2020 2. The aggregate of fees charged pursuant to par. (d) 2. b.
AB218,35,2421 (g) Subject to adjustment of the dollar amount pursuant to sub. (31) (f), if a
22payment to a provider by an individual under this section is dishonored, a provider
23may impose a reasonable charge on the individual, not to exceed the lesser of $25 and
24the amount permitted by law other than this section.
AB218,36,6
1(23) Voluntary contributions. A provider may not solicit a voluntary
2contribution from an individual or an affiliate of the individual for any service
3provided to the individual. A provider may accept voluntary contributions from an
4individual but, until 30 days after completion or termination of a plan, the aggregate
5amount of money received from or on behalf of the individual may not exceed the total
6amount the provider may charge the individual under sub. (22).
AB218,36,9 7(24) Voidable agreements. (a) If a provider imposes a fee or other charge or
8receives money or other payments not authorized by sub. (22) or (23), the individual
9may void the agreement and recover as provided in sub. (34).
AB218,36,1110 (b) If a provider is not licensed as required by this section when an individual
11assents to an agreement, the agreement is voidable by the individual.
AB218,36,1312 (c) If an individual voids an agreement under par. (b), the provider does not
13have a claim against the individual for breach of contract or for restitution.
AB218,36,16 14(25) Termination of agreements. (a) If an individual who has entered into an
15agreement fails for 60 days to make payments required by the agreement, a provider
16may terminate the agreement.
AB218,36,1817 (b) If a provider or an individual terminates an agreement, the provider shall
18immediately return to the individual all of the following:
AB218,36,1919 1. Any money of the individual held in trust for the benefit of the individual.
AB218,36,2120 2. Sixty-five percent of any portion of the set-up fee received pursuant to sub.
21(22) (d) 2. which has not been credited against settlement fees.
AB218,37,2 22(26) Periodic reports and retention of records. (a) A provider shall provide
23the accounting required by par. (b) upon cancellation or termination of an agreement.
24Before cancellation or termination of any agreement, a provider shall also provide
25the accounting required by par. (b) at least once each month and within 5 business

1days after a request by an individual, but the provider need not comply with more
2than one request in any calendar month.
AB218,37,43 (b) A provider, in a record, shall provide each individual for whom it has
4established a plan an accounting of all of the following information:
AB218,37,55 1. The amount of money received from the individual since the last report.
AB218,37,86 2. The amounts and dates of disbursement made on the individual's behalf, or
7by the individual upon the direction of the provider, since the last report to each
8creditor listed in the plan.
AB218,37,99 3. The amounts deducted from the amount received from the individual.
AB218,37,1010 4. The amount held in reserve.
AB218,37,1311 5. If, since the last report, a creditor has agreed to accept as payment in full an
12amount less than the principal amount of the debt owed by the individual, all of the
13following:
AB218,37,1414 a. The total amount and terms of the settlement.
AB218,37,1515 b. The amount of the debt when the individual assented to the plan.
AB218,37,1616 c. The amount of the debt when the creditor agreed to the settlement.
AB218,37,1717 d. The calculation of a settlement fee.
AB218,37,2218 (c) A provider shall maintain records for each individual for whom it provides
19debt-management services for 5 years after the final payment made by the
20individual and produce a copy of them to the individual within a reasonable time
21after a request for them. The provider may use electronic or other means of storage
22of the records.
AB218,37,24 23(27) Prohibited acts and practices. (a) A provider may not, directly or
24indirectly, do any of the following:
AB218,37,2525 1. Misappropriate or misapply money held in trust.
AB218,38,3
12. Settle a debt on behalf of an individual for more than 50 percent of the
2principal amount of the debt owed a creditor, unless the individual assents to the
3settlement after the creditor has assented.
AB218,38,64 3. Take a power of attorney that authorizes it to settle a debt, unless the power
5of attorney expressly limits the provider's authority to settle debts for not more than
650 percent of the principal amount of the debt owed a creditor.
AB218,38,87 4. Exercise or attempt to exercise a power of attorney after an individual has
8terminated an agreement.
AB218,38,139 5. Initiate a transfer from an individual's account at a financial institution or
10with another person unless the transfer is a return of money to the individual or
11unless the transfer is before termination of an agreement, properly authorized by the
12agreement and this section, and for payment to one or more creditors pursuant to a
13plan or payment of a fee.
AB218,38,1514 6. Offer a gift or bonus, premium, reward, or other compensation to an
15individual for executing an agreement.
AB218,38,2016 7. Offer, pay, or give a gift or bonus, premium, reward, or other compensation
17to a person for referring a prospective customer, if the person making the referral has
18a financial interest in the outcome of debt-management services provided to the
19customer, unless neither the provider nor the person making the referral
20communicates to the prospective customer the identity of the source of the referral.
AB218,38,2221 8. Receive a bonus, commission, or other benefit for referring an individual to
22a person.
AB218,39,223 9. Structure a plan in a manner that would result in a negative amortization
24of any of an individual's debts, unless a creditor that is owed a negatively amortizing

1debt agrees to refund or waive the finance charge upon payment of the principal
2amount of the debt.
AB218,39,43 10. Compensate its employees on the basis of a formula that incorporates the
4number of individuals the employee induces to enter into agreements.
AB218,39,85 11. Settle a debt or lead an individual to believe that a payment to a creditor
6is in settlement of a debt to the creditor unless, at the time of settlement, the
7individual receives a certification by the creditor that the payment is in full
8settlement of the debt.
AB218,39,99 12. Make a representation of any of the following:
AB218,39,1010 a. That the provider will furnish money to pay bills or prevent attachments.
AB218,39,1211 b. That payment of a certain amount will permit satisfaction of a certain
12amount or range of indebtedness.
AB218,39,1413 c. That participation in a plan will or may prevent litigation, garnishment,
14attachment, repossession, foreclosure, eviction, or loss of employment.
AB218,39,1615 13. Misrepresent that it is authorized or competent to furnish legal advice or
16perform legal services.
AB218,39,2017 14. Represent that it is a not-for-profit entity unless it is organized and
18properly operating as a not-for-profit under the law of the state in which it was
19formed or that it is a tax-exempt entity unless it has received certification of
20tax-exempt status from the Internal Revenue Service.
AB218,39,2221 15. Take a confession of judgment or power of attorney to confess judgment
22against an individual.
AB218,39,2423 16. Employ an unfair, unconscionable, or deceptive act or practice, including
24the knowing omission of any material information.
AB218,40,2
1(b) If a provider furnishes debt-management services to an individual, the
2provider may not, directly or indirectly, do any of the following:
AB218,40,33 1. Purchase a debt or obligation of the individual.
AB218,40,44 2. Receive from or on behalf of the individual any of the following:
AB218,40,65 a. A promissory note or other negotiable instrument other than a check or a
6demand draft.
AB218,40,77 b. A post-dated check or demand draft.
AB218,40,98 3. Lend money or provide credit to the individual, except as a deferral of a
9settlement fee at no additional expense to the individual.
AB218,40,1110 4. Obtain a mortgage or other security interest from any person in connection
11with the services provided to the individual.
AB218,40,1412 5. Except as permitted by federal law, disclose the identity or identifying
13information of the individual or the identity of the individual's creditors, except to
14any of the following:
AB218,40,1515 a. The division, upon proper demand.
AB218,40,1716 b. A creditor of the individual, to the extent necessary to secure the cooperation
17of the creditor in a plan.
AB218,40,1818 c. The extent necessary to administer the plan.
AB218,40,2019 6. Except as otherwise provided in sub. (22) (f), provide the individual less than
20the full benefit of a compromise of a debt arranged by the provider.
AB218,40,2421 7. Charge the individual for or provide credit or other insurance, coupons for
22goods or services, membership in a club, access to computers or the Internet, or any
23other matter not directly related to debt-management services or educational
24services concerning personal finance.
AB218,41,3
18. Furnish legal advice or perform legal services, unless the person furnishing
2that advice to or performing those services for the individual is licensed to practice
3law.
AB218,41,44 (c) This section does not authorize any person to engage in the practice of law.
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