138.09(9)(b)
(b) No loan made under this section, for which a greater rate or amount of interest, than is allowed by this section, has been contracted for or received, wherever made, shall be enforced in this state, and every person in any wise participating therein in this state shall be subject to this section. If a licensee makes an excessive charge as the result of an unintentional mistake, but upon demand makes correction of such mistake, the loan shall be enforceable and treated as if no violation occurred at the agreed rate. Nothing in this paragraph shall limit any greater rights or remedies afforded in
chs. 421 to
427 to a customer in a consumer credit transaction.
138.09(10)
(10) Any person, partnership or corporation and the several officers and employes thereof who shall violate any of the provisions of this section shall be guilty of a misdemeanor, and upon conviction thereof shall be fined not more than $500 or imprisoned for not more than 6 months or both.
138.09(11)
(11) The division may employ necessary examiners or other personnel from time to time and fix their compensation.
138.09(12)
(12) No person, association, partnership or corporation doing business under the authority of any law of this state or of the United States relating to banks, savings banks, trust companies, savings or building and loan associations, or credit unions shall be eligible to become a licensee under this section.
138.09 History
History: 1971 c. 60,
125,
239,
307;
1973 c. 2,
243;
1975 c. 407;
1977 c. 29 s.
1654 (7) (b);
1977 c. 444;
1979 c. 110 s.
60 (13);
1979 c. 168;
1981 c. 45 ss.
11 to
16,
51;
1983 a. 36,
192,
385;
1985 a. 127;
1987 a. 27;
1989 a. 31;
1991 a. 39,
221;
1993 a. 112,
184,
368,
482,
490;
1995 a. 27,
225,
272.
138.09 Annotation
Instalment sellers are not precluded by s. 138.09, 1973 stats., from charging precomputed interest. First Nat. Bank of Wisconsin Rapids v. Dickinson, 103 W (2d) 428, 308 NW (2d) 910 (Ct. App. 1981).
138.09 Annotation
See note to 422.201, citing Clark v. Aetna Finance Corp. 115 W (2d) 581, 340 NW (2d) 747 (Ct. App. 1983).
138.09 Annotation
Wisconsin has compelling interest in applying statutory regulations to banking activities on Indian reservations.
80 Atty. Gen. 337.
138.10(2)(2)
Maximum loan. A pawnbroker's loan shall not exceed $150.
138.10(3)
(3) Definitions. The following terms in this section shall be construed to have the following meanings:
138.10(3)(a)
(a) "Pawnbroker" includes any person who engages in the business of lending money on the deposit or pledge of personal property, other than choses in action, securities, or written evidences of indebtedness; or purchases personal property with an expressed or implied agreement or understanding to sell it back at a subsequent time at a stipulated price.
138.10(3)(b)
(b) "Pawnbroking" means the business of a pawnbroker as defined in this section.
138.10(3)(c)
(c) "Pawn ticket" means the card, book, receipt or other record furnished to the pledgor at the time a loan is granted containing the terms of the contract for a loan.
138.10(3)(d)
(d) "Person" includes an individual, partnership, association, business corporation, nonprofit corporation, common law trust, joint-stock company or any group of individuals however organized.
138.10(3)(e)
(e) "Pledge" means an article or articles deposited with a pawnbroker as security for a loan in the course of the pawnbroker's business as defined in
par. (a).
138.10(3)(f)
(f) "Pledgor" means the person who obtains a loan from a pawnbroker and delivers a pledge into the possession of a pawnbroker, unless the person discloses that he or she is or was acting for another in which case a "pledgor" means the disclosed principal.
138.10(4)
(4) Maximum interest or charges. A pawnbroker shall not charge, contract for or receive interest in excess of 3% per month on any loan or balance thereon and such interest shall not be increased by charging commission, discount, storage or other charge directly or indirectly, nor by compound interest; provided, however, that when the interest herein specified amounts to less than $1 per month, the minimum charge shall be $1 for the first month and 50 cents for each succeeding month during the loan period.
138.10(4m)
(4m) When limit on maximum interest does not apply. Subsection (4) does not apply to a pawnbroker's loan made after October 31, 1984 and before November 1, 1987.
138.10(5)
(5) Computation of interest or charges. The interest and charges authorized by this section shall be computed at the rates specified on the actual principal balance of the loan due for the actual time which has elapsed from the date of the loan to the date of payment. For the purpose of calculation of interest and charges permitted under this section, a year shall be 12 calendar months, and a month shall be one calendar month, or any fractional part thereof. A calendar month shall be any period from a certain date in one month to the same date in the next succeeding month.
138.10(6)
(6) Forfeiture. A pawnbroker who charges, contracts for or receives interest or charges greater than permitted under this section shall forfeit both principal and interest, and shall return the pledge upon demand of the pledgor and surrender of the pawn ticket, without tender or payment of principal or interest.
138.10(7)
(7) Penalty. Any pawnbroker who shall refuse to comply with
sub. (6) shall, upon conviction, be punished by imprisonment in the county jail not more than one year or by fine not exceeding $500.
138.10(8)
(8) Sale of pledge. Upon default in the payment of any loan, a pawnbroker may sell the pledge upon the conditions contained in this section.
138.10(8)(a)
(a) A pawnbroker may sell a pledge at private sale for an amount not less than that agreed to by the pledgor, which amount shall be stipulated on the pawn ticket and shall not be less than 125% of the amount of the loan. A pledge which cannot be sold at private sale at the minimum price agreed to by the pledgor must be sold at public auction, which sale shall be conducted in the manner provided by
s. 779.48 (1).
138.10(8)(b)
(b) No unredeemed pledge may be sold before the expiration of 90 days after the due date of the loan unless otherwise specifically authorized in writing by the pledgor. The authority to sell an unredeemed pledge prior to the expiration of 90 days after the due date of the loan must be given by the pledgor on a date subsequent to the due date of the loan.
138.10(8)(c)
(c) An unredeemed pledge must be sold within 12 months of the due date of a loan. No interest or charges permitted under this section may be collected on a loan after the expiration of 12 months of the due date of a loan, whether the loan is renewed or the loan is paid and the pledge redeemed.
138.10(9)
(9) Notice of sale. A pawnbroker shall not sell any pledge unless due notice of such contemplated sale has been forwarded to the pledgor by registered mail to the address given by the pledgor at the time of obtaining the loan or to such new address of the pledgor, as shown on the pawnbroker's record. Notice of the contemplated sale of a pledge shall be mailed to the pledgor not less than 30 days prior to the date of sale. Such notice shall state total amount of principal, interest and charges due on the loan as of the date of the notice.
138.10(10)
(10) Disposition of proceeds. The proceeds from the sale of a pledge shall be applied in the order specified, to the following purposes: Payment of the auctioneer's charges if sold at public auction, or commission for selling not to exceed 5% if sold at private sale; payment of principal of the loan; payment of the interest on the loan permitted under this section, and payment of the charges on the loan permitted under this section; payment of postage for mailing notice to the pledgor of the contemplated sale or notice of the surplus. The surplus, if any, shall be paid to the pledgor or such other person who would have been entitled to redeem the pledge had it not been sold.
138.10(11)
(11) Notice of surplus. Notice of any surplus from the sale of a pledge shall be forwarded to the pledgor within 10 days of the date of sale by registered mail to the address given by the pledgor at the time of obtaining the loan or to such new address of the pledgor, of which the pawnbroker has received notice.
138.10(12)
(12) Reversion of surplus. If a surplus remaining from the sale of a pledge is not paid or claimed within one year from the date of sale, such surplus shall revert to the pawnbroker. The pawnbroker shall not be required to pay any interest on an unpaid surplus.
138.12
138.12
Insurance premium finance companies. 138.12(1)(1)
Definitions. For purposes of this section:
138.12(1)(b)
(b) "Insurance premium finance company" means a person engaged in the business of entering into insurance premium finance agreements.
138.12(1)(c)
(c) "Licensee" means an insurance premium finance company holding a license issued by the division under this section.
138.12(1)(d)
(d) "Premium finance agreement" means an agreement by which an insured or prospective insured promises to pay to an insurance premium finance company the amount advanced or to be advanced under the agreement to an insurer or to an insurance agent or broker in payment of premiums on an insurance contract together with a service charge or interest charge as authorized and limited by this chapter.
138.12(2)
(2) Scope. This section shall not apply to:
138.12(2)(a)
(a) Any insurance company or agent defined in
s. 628.02, any savings and loan association, savings bank, sales finance company, motor vehicle instalment seller, bank, trust company, licensed lender or credit union authorized to do business in this state, but such organizations, if otherwise eligible, are exempt from the licensing under this section, but
subs. (9) to
(12) and any rules promulgated by the division pertaining to such subsections shall be applicable to all premium finance transactions entered into by such organizations in this state if an insurance policy or any rights thereunder is made the security or collateral for repayment of the debt.
138.12(2)(b)
(b) The inclusion of insurance in connection with an instalment sale of a motor vehicle or other goods and services.
138.12(3)(a)(a) No person except those listed in
sub. (2) (a) shall engage in the business of financing insurance premiums in this state without first having obtained a license. Any person who engages in the business of financing insurance premiums in this state without obtaining a license may be fined not more than $200.
138.12(3)(b)
(b) The annual license fee is $500 and shall be paid to the division. Licenses may be renewed May 1 of each year upon payment of the annual fee.
138.12(3)(c)
(c) The person to whom the license or the renewal thereof is issued shall file sworn answers, subject to the penalties of perjury, to such interrogatories as the division requires. The division may, at any time, require the applicant fully to disclose the identity of all stockholders, partners, members, managers, officers and employes, and the division may refuse to issue or renew a license in the name of any person if the division is not satisfied that any officer, employe, stockholder, partner, member or manager thereof, who may materially influence the applicant's conduct, meets the standards of this section.
138.12(4)(a)(a) Upon the filing of an application and the payment of the required fees under
par. (am) 1., the division shall make an investigation of each applicant and shall issue a license if the division finds the applicant is qualified in accordance with this section. If the division does not so find, the division shall, within 30 days after the division has received the application, notify the applicant and, at the request of the applicant, give the applicant a full hearing.
138.12(4)(am)1.1. An applicant shall pay to the division a nonrefundable $300 license investigation fee and a $500 annual license fee for the period ending on the next April 30.
138.12(4)(am)2.
2. If the cost of the investigation exceeds $300, the applicant shall, upon demand of the division, pay the amount by which the cost of the investigation exceeds the nonrefundable fee.
138.12(4)(b)
(b) The division shall issue or renew a license when the division is satisfied that the person to be licensed:
138.12(4)(b)1.
1. Is competent and trustworthy and intends to act in good faith in the capacity involved by the license applied for,
138.12(4)(b)2.
2. Has a good business reputation and has had experience, training or education so as to be qualified in the business for which the license is applied for, and
138.12(4)(b)3.
3. If a corporation, is a corporation incorporated under the laws of this state or a foreign corporation authorized to transact business in this state.
138.12(4)(b)3L.
3L. If a limited liability company, is organized under the laws of this state or a foreign limited liability company authorized to transact business in this state.
138.12(5)(a)(a) The commissioner may revoke or suspend the license of any insurance premium finance company if the commissioner finds that:
138.12(5)(a)1.
1. Any license issued to such company was obtained by fraud,
138.12(5)(a)2.
2. There was any misrepresentation in the application for the license,
138.12(5)(a)3.
3. The holder of such license has otherwise shown himself or herself untrustworthy or incompetent to act as a premium finance company,
138.12(5)(a)4.
4. Such company has violated any provision of this section, or
138.12(5)(a)5.
5. Such company has been rebating part of the service charge as allowed and permitted herein to any insurance agent or insurance broker or any employe of an insurance agent or insurance broker or to any other person as an inducement to the financing of any insurance policy with the premium finance company.
138.12(5)(b)
(b) Before the division revokes, suspends or refuses to renew the license of any premium finance company, the division shall give the company an opportunity to be fully heard and to introduce evidence in the company's behalf. In lieu of revoking or suspending the license for any of the causes enumerated in this subsection, after hearing, the division may subject the premium finance company to a penalty of not more than $200 for each offense when in the division's judgment the division finds that the public interest would not be harmed by the continued operation of such company. The amount of any penalty under this paragraph shall be paid by the company to the division for the use of the state. At any hearing under this subsection, the division may administer oaths to witnesses. Anyone testifying falsely, after having been administered the oath, shall be subject to the penalty of perjury.
138.12(5)(c)
(c) Any action of the division in refusing to issue or renew a license shall be subject to review under
subch. III of ch. 227.
138.12(6)(a)(a) Every licensee shall maintain records of its premium finance transactions and the records shall be open to an examination and investigation by the division. The division may make an examination of the books, records and accounts of any licensee as the division deems necessary. The division shall determine the cost of an examination and that cost shall be assessed against and paid by the licensee so examined. The division may, at any time, require any licensee to bring such records as the division directs to the division for examination.
138.12(6)(b)
(b) Every licensee shall preserve its records of such premium finance transactions, including cards used in a card system, for at least 3 years after making the final entry in respect to any premium finance agreement. The preservation of records in photographic form or other form authorized under
s. 220.285 shall constitute compliance with this requirement.
138.12(7)
(7) Rules and regulations. The division may make and enforce such reasonable rules as are necessary to carry out this section, but such rules shall not be contrary to nor inconsistent with this section.
138.12(8)(a)1.
1. Be dated, signed by or on behalf of the insured, and the printed portion thereof shall be in at least 8-point type,
138.12(8)(a)2.
2. Contain the name and place of business of the insurance agent or insurance broker negotiating the related insurance contract, the name and residence or the place of business of the insured as specified by the insured, the name and place of business of the premium finance company to which instalment or other payments are to be made, a description of the insurance contracts, including term and type of policy, the premiums for which are advanced or to be advanced under the agreement and the amount of the premiums therefor; and
138.12(8)(a)3.c.
c. The principal balance (the difference between items a and b),
138.12(8)(a)3.f.
f. The number of instalments required, the amount of each instalment expressed in dollars, and the due date or period thereof.
138.12(8)(b)
(b) The items set forth in
par. (a) 3. need not be stated in the sequence or order in which they appear and additional items may be included to explain the computations made in determining the amount to be paid by the insured.
138.12(9)
(9) Service charges. A premium finance company shall not charge, contract for, receive or collect a service charge other than as permitted by this subsection unless it is a licensed lender regulated under
sub. (10).
138.12(9)(a)
(a) The service charge shall be computed on the balance of the premiums due (after subtracting the down payment made by the insured in accordance with the premium finance agreement) from the effective date of the insurance coverage, for which the premiums are being advanced, to and including the date when the final instalment of the premium finance agreement is payable.
138.12(9)(b)
(b) The service charge may not exceed the interest rate authorized under
s. 422.201 (2) (bm) per year plus an additional charge of $10 per premium finance agreement, but, if the principal balance is $50 or less there shall be no additional charge, and if the principal balance is more than $50 but not more than $100, the additional charge is $6.
138.12(9)(bm)
(bm) Paragraph (b) applies only to a premium finance agreement in which the related insurance contract is for personal, family or household use entered into before November 1, 1984. The service charge for any other premium finance agreement shall be as agreed by the parties to the agreement.
138.12(9)(c)
(c) The service charge shall be computed on the principal balance of a premium finance agreement payable in successive monthly instalments substantially equal in amount for a period of one year. On a premium finance agreement providing for instalments extending for a period less than or greater than one year, the service charge shall be computed proportionately.
138.12(9)(d)
(d) Notwithstanding the provisions of any premium finance agreement, any insured may prepay the obligation in full at any time. In such event, the insured shall receive a refund credit. The amount of such refund credit shall represent at least as great a proportion of the service charge as the sum of the periodic balances after the month in which prepayment is made bears to the sum of all periodic balances under the schedule of instalments in the agreement. Where the amount of the refund credit is less than $1, no refund need be made. If in addition to the service charge an additional charge was imposed, such additional charge need not be refunded nor taken into consideration in computing the refund credit.
138.12(10)
(10) Charges by licensed lenders; rebates. 138.12(10)(a)(a) A lender licensed under
s. 138.09 may charge interest as provided in that section for a loan involving a premium finance agreement.
138.12(10)(b)
(b) The interest shall be computed on the balance of the premiums due (after subtracting the down payment made by the insured in accordance with the premium finance agreement) from the effective date of the insurance coverage, for which the premiums are being advanced, to and including the date when the final instalment of the premium finance agreement is payable.
