SB68 Alabama 2015 Session

Summary

Primary Sponsor

Cam Ward

Republican

Session

Regular Session 2015

Title

Consumer, regulate the lending of money, Sec. 6-8-120 added; Secs. 5-19-1, 5-19-3, 5-19-16 am'd.

Summary

SB68 creates the Alabama Consumer Lawsuit Lending Act to regulate money lent to consumers for lawsuits by defining lenders, capping charges, requiring licensing, and giving enforcement powers to the state.

What This Bill Does

It treats each consumer lawsuit lending arrangement as a loan and caps the finance charge at $10 per $100 of principal per year, regardless of loan size or structure. It requires every consumer lawsuit lender to be licensed under Section 5-19-22 and to follow related lending rules; the State Superintendent of Banks can issue regulations and interpretations. The act links CLS lenders to existing lending laws and penalties, including criminal penalties for willful violations of the cap or of the licensing requirement.

Who It Affects

• Consumer lawsuit lenders (CLS lenders): must obtain a license, comply with the finance charge cap and other lending provisions, and may face penalties for violations.
• Consumers who receive CLS funds: their lending terms are governed by the act, with a defined cap and licensing oversight.
• State regulators, specifically the Superintendent of Banks: authorized to issue regulations and interpretations and enforce the act.

Key Provisions

• Establishes the Alabama Consumer Lawsuit Lending Act and defines key terms such as consumer, consumer lawsuit lender, consumer lawsuit lending, dispute, and finance charge.
• Finance charge cap: the maximum charge is $10 for every $100 of the principal per year, applicable regardless of transaction structure or amount.
• Licensing and applicability: every CLS lender must be licensed under 5-19-22 and is subject to 5-19-16, 5-19-19, 5-19-23 through 5-19-26, and 5-19-29; licensing applies regardless of the number of extensions of credit.
• Regulation and interpretation: the Superintendent of Banks can issue regulations and official interpretations necessary to enforce the act.
• Penalties: willful charging above the cap or failure to obtain a license constitutes a misdemeanor with fines up to $500, imprisonment up to one year, or both.
• Effective date and transition: sets a future effective date and requires existing CLS lenders to obtain licenses by a specified deadline, with prorated license fees for 2014.
• Local funds note: the bill acknowledges Amendment 621 but provides an exception, stating the act does not trigger new local expenditure requirements outside the specified exceptions.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Consumer