50-1117. Same; definitions.

50-1117

Chapter 50.--UNFAIR TRADE AND CONSUMER PROTECTION
Article 11.--CREDIT SERVICES ORGANIZATIONS

      50-1117.   Same; definitions.Definitions as used in this act: (a) "Commissioner" meansthe state bank commissioner.

      (b)   "Consumer" means an individual who is a resident of this state.

      (c)   "Credit services organization" means a person who engages in, or holdsout to the public aswilling to engage in, the business of debt management services for a fee,compensation or gain,or in the expectation of a fee, compensation or gain.

      (d)   "Debt management service" means:

      (1)   Receiving or offering to receive funds from a consumer for the purpose ofdistributing thefunds among such consumer's creditors in full or partial payment of suchconsumer'sdebts;

      (2)   improving or offering to improve a consumer's credit record, history orrating; or

      (3)   negotiating or offering to negotiate to defer or reduce a consumer'sobligations withrespect to credit extended by others.

      (e)   "Insolvent" means a person whose debts exceed their assets.

      (f)   "Person" means any individual, corporation, partnership, association,unincorporatedorganization or other form of entity, however organized, including a nonprofitentity.

      (g)   "Related interest" means a person:

      (1)   With respect to an individual who is:

      (A)   The spouse of the individual;

      (B)   a brother, brother-in-law, sister, sister-in-law of the individual;

      (C)   an ancestor or lineal descendant of the individual or the individual'sspouse; and

      (D)   any other relative, by blood, adoption or marriage, of the individual orsuchindividual's spouse who shares the same residence with the individual.

      (2)   With respect to a corporation, partnership, association, unincorporatedorganization orother form of entity, however organized, including a nonprofit entity, whichis:

      (A)   Directly or indirectly controlling, controlled by or under common controlby aperson; or

      (B)   an officer or director of a person or a person performing similarfunctions.

      (h)   "Registrant" means a person who is registered by the commissioner as acredit servicesorganization.

      (i)   "Trust account" means an account established by the applicant orregistrant in a federally insuredfinancial institution usedto hold funds paid by consumers to a credit services organization fordisbursement to creditors of consumers that is designated as a trust account orother appropriate designation indicating thefunds in the account are:

      (1)   Not funds of the applicant or registrant or its owners, officers oremployees; and

      (2)   unavailable to creditors of the applicant or registrant.

      History:   L. 2004, ch. 22, § 2; July 1.