HB160 Alabama 2015 Session

This bill would regulate the providing of money or credit to a consumer pursuant to an agreement under which the consumer is not prohibited from using the money or credit for a purpose other than prosecuting a dispute, and under which repayment of the money or credit is conditioned upon the consumer's recovery of money in a dispute or where recourse against the consumer by the person providing the money or credit is limited exclusively or primarily to the amount recovered by the consumer in a dispute

This bill would define provider of money or credit as a consumer lawsuit lender

This bill would provide that each provision of money or credit would be deemed to be a consumer loan and the maximum finance charge on the loan would be as provided in this bill, regardless of the amount of the loan or credit provided

This bill would require each consumer lawsuit lender to obtain a license under Section 5-19-22 of the Code of Alabama 1975

This bill would provide that the lender would be subject to Sections 5-19-16, 5-19-19, 5-19-23, 5-19-24, 5-19-25, and 5-19-26, Code of Alabama 1975

This bill would allow the Superintendent of Banks of the State Banking Department to issue regulations and interpretations under the act

This bill would provide that criminal penalties be provided for willful violation of the maximum finance charge provision or the requirement that the consumer lawsuit lender must obtain a license

Amendment 621 of the Constitution of Alabama of 1901, now appearing as Section 111.05 of the Official Recompilation of the Constitution of Alabama of 1901, as amended, prohibits a general law whose purpose or effect would be to require a new or increased expenditure of local funds from becoming effective with regard to a local governmental entity without enactment by a 2/3 vote unless: it comes within one of a number of specified exceptions; it is approved by the affected entity; or the Legislature appropriates funds, or provides a local source of revenue, to the entity for the purpose

The purpose or effect of this bill would be to require a new or increased expenditure of local funds within the meaning of the amendment. However, the bill does not require approval of a local governmental entity or enactment by a 2/3 vote to become effective because it comes within one of the specified exceptions contained in the amendment

Relating to the extension of money or credit consumers for a purpose other than the prosecution of a dispute where repayment of the money or credit is conditioned upon the consumer's recovery of money in a dispute or where recourse against the consumer by the person providing the money or credit is limited exclusively or primarily to the amount recovered by the consumer in a dispute; to define the terms amount financed, consumer, consumer lawsuit lender, consumer lawsuit lending, consumer lawsuit lending agreement, dispute, and finance charge; to provide for the maximum finance charge under a consumer lawsuit lending agreement without regard to the amount financed or the manner in which the transaction is structured; to provide that a consumer lawsuit lender is required to be licensed under Section 5-19-22 of the Code of Alabama 1975, to engage in consumer lawsuit lending transactions without regard to the number of extensions of credit the consumer lawsuit lender made or arranged in the preceding calendar year; to provide that a consumer lawsuit lender is subject to the provisions of Sections 5-19-16, 5-19-19, 5-19-23, 5-19-24, 5-19-25, and 5-19-26, Code of Alabama 1975; to provide that the Superintendent of Banks of the State Banking Department is authorized to issue regulations and interpretations of this act; to provide remedies for violations of this act by a consumer lawsuit lender; to provide criminal penalties for a consumer lawsuit lender that intentionally charges a finance charge under a consumer lawsuit lending agreement in excess of the maximum finance charge permitted under this act or fails to obtain the license required by this act; and in connection therewith would have as its purpose or effect the requirement of a new or increased expenditure of local funds within the meaning of Amendment 621 of the Constitution of Alabama of 1901, now appearing as Section 111.05 of the Official Recompilation of the Constitution of Alabama of 1901, as amended.