CHAPTER 6. ADMINISTRATION
IC 24-4.5-6
Chapter 6. Administration
(Part 1. Powers and Functions of Administrator)
IC 24-4.5-6-101
Short title
Sec. 101. Short Title _ This Chapter shall be known and may becited as Uniform Consumer Credit Code _ Administration.
(Formerly: Acts 1971, P.L.366, SEC.7.)
IC 24-4.5-6-102
Applicability
Sec. 102. (a) IC 24-4.5-6-101 through IC 24-4.5-6-117 apply topersons who in this state:
(1) make or solicit consumer credit sales, consumer leases,consumer loans, consumer related sales (IC 24-4.5-2-602) andconsumer related loans (IC 24-4.5-3-602); or
(2) directly collect payments from or enforce rights againstdebtors arising from sales, leases, or loans specified insubsection (1), wherever they are made.
(b) For purposes of IC 24-4.5-6-101 through IC 24-4.5-6-117:
(1) "Consumer credit sale" includes a sale that is a first lienmortgage transaction if the sale is otherwise a consumer creditsale.
(2) "Consumer loan" includes a loan that is a first lien mortgagetransaction if the loan is otherwise a consumer loan.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by Acts 1981,P.L.218, SEC.8; P.L.152-1986, SEC.71; P.L.35-2010, SEC.64.
IC 24-4.5-6-103
Department
Sec. 103. Department _ "Department" means the members of thedepartment of financial institutions. The division of consumer creditshall have charge of the administration of this article.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.45.
IC 24-4.5-6-103.5
Repealed
(Repealed by P.L.35-2010, SEC.209.)
IC 24-4.5-6-104
Powers of department; reliance on rules
Sec. 104. (1) In addition to other powers granted by this article,the department within the limitations provided by law may:
(a) receive and act on complaints, take action designed to obtainvoluntary compliance with this article, or commenceproceedings on the department's own initiative;
(b) counsel persons and groups on their rights and duties under
this article;
(c) establish programs for the education of consumers withrespect to credit practices and problems;
(d) make studies appropriate to effectuate the purposes andpolicies of this article and make the results available to thepublic;
(e) adopt, amend, and repeal rules, orders, policies, and formsto carry out the provisions of this article;
(f) maintain more than one (1) office within Indiana; and
(g) appoint any necessary attorneys, hearing examiners, clerks,and other employees and agents and fix their compensation, andauthorize attorneys appointed under this section to appear forand represent the department in court.
(2) No liability is imposed under this article for an act done oromitted in conformity with a rule, written notice, written opinion,written interpretation, or written directive of the departmentnotwithstanding that after the act or omission the rule, written notice,written opinion, written interpretation, or written directive may beamended or repealed, or be determined by judicial or other authorityto be invalid for any reason.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended byP.L.247-1983, SEC.22; P.L.14-1992, SEC.46; P.L.45-1995, SEC.15;P.L.172-1997, SEC.9; P.L.213-2007, SEC.14; P.L.217-2007,SEC.13.
IC 24-4.5-6-105
Administrative powers with respect to depository institutions
Sec. 105. (1) With respect to depository institutions, the powersof examination and investigation (IC 24-4.5-6-106) andadministrative enforcement (IC 24-4.5-6-108) shall be exercised bythe department. The department may, at its discretion, accept anyexamination of any financial institution made by a federal authorityin lieu of the examination made under the provisions of this article.All other powers of the department under this article may beexercised by the director with respect to a depository institution.
(2) If the department receives a complaint or other informationconcerning noncompliance with this article by a depositoryinstitution, the director shall inform the official or agency havingsupervisory authority over the organization concerned. Thedepartment may request information about depository institutionsfrom the officials or agencies supervising them.
(3) The department and any official or agency of this state havingsupervisory authority over a depository institution are authorized anddirected to consult and assist one another in maintaining compliancewith this article. They may jointly pursue investigations, prosecutesuits, and take other official action, as they deem appropriate, ifeither of them otherwise is empowered to take the action.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.47; P.L.35-2010, SEC.65.
IC 24-4.5-6-106
Department's examination and investigatory authority; recordretention; director's authority to control access to records; courtorder compelling compliance; confidentiality; examination ofvendors
Sec. 106. (1) In administering this article and in order todetermine whether the provisions of this article are being compliedwith by persons engaging in acts subject to this article, thedepartment may examine the records of persons and may makeinvestigations of persons as may be necessary to determinecompliance. Records subject to examination under this sectioninclude the following:
(a) Training, operating, and policy manuals.
(b) Minutes of:
(i) management meetings; and
(ii) other meetings.
(c) Other records that the department determines are necessaryto perform its investigation or examination.
The department may also administer oaths or affirmations, subpoenawitnesses, and compel the attendance of witnesses, includingdirectors, executive officers, managers, principals, mortgage loanoriginators, employees, independent contractors, agents, andcustomers of the licensee, individual, or person subject to this article.The department may also adduce evidence, and require theproduction of any matter which is relevant to the investigation. Thedepartment shall determine the sufficiency of the records maintainedand whether the person has made the required informationreasonably available. The records pertaining to any transactionsubject to this article shall be retained for two (2) years after makingthe final entry relating to the consumer credit transaction, but in thecase of a revolving loan account or revolving charge account, the two(2) years is measured from the date of each entry.
(2) The department's examination and investigatory authorityunder this article includes the following:
(a) The authority to require a creditor to refund overchargesresulting from the creditor's noncompliance with the terms of asubordinate lien mortgage transaction.
(b) The authority to require a creditor to comply with thepenalty provisions set forth in IC 24-4.5-3-209.
(c) The authority to investigate complaints filed with thedepartment by debtors.
(3) If the department:
(a) investigates; or
(b) examines the books and records of;
a person that is subject to IC 24-4.5-6-201, IC 24-4.5-6-202, andIC 24-4.5-6-203, the person shall pay all reasonably incurred costs ofthe investigation or examination in accordance with the fee scheduleadopted by the department under IC 28-11-3-5. However, the personis liable for the costs of an investigation or examination under thissubsection only to the extent that the costs exceed the amount of the
filing fees paid most recently under IC 24-4.5-6-203. Any costsrequired to be paid under this subsection shall be paid not later thansixty (60) days after the person receives a notice from the departmentof the costs being assessed. The department may impose a fee, in anamount fixed by the department under IC 28-11-3-5, for each daythat the assessed costs are not paid, beginning on the first day afterthe sixty (60) day period described in this subsection.
(4) The department shall be given free access to the recordswherever located. In making any examination or investigationauthorized by this article, the director may control access to anydocuments and records of the licensee or person under examinationor investigation. The director may take possession of the documentsand records or place a person in exclusive charge of the documentsand records in the place where the documents are usually kept.During the period of control, the licensee or person may not removeor attempt to remove any of the documents and records except undera court order or with the consent of the director. Unless the directorhas reasonable grounds to believe the documents or records of thelicensee or person have been, or are, at risk of being altered ordestroyed for purposes of concealing a violation of this article, thelicensee or person being examined or investigated is entitled toaccess to the documents or records as necessary to conduct thelicensee's or person's ordinary business affairs. If the person's recordsare located outside Indiana, the records shall be made available to thedepartment at a convenient location within Indiana, or the personshall pay the reasonable and necessary expenses for the departmentor its representative to examine them where they are maintained. Thedepartment may designate comparable officials of the state in whichthe records are located to inspect them on behalf of the department.
(5) Upon a person's failure without lawful excuse to obey asubpoena or to give testimony and upon reasonable notice to allaffected persons, the department may apply to any civil court withjurisdiction for an order compelling compliance.
(6) The department shall not make public the name or identity ofa person whose acts or conduct the department investigates pursuantto this section or the facts disclosed in the investigation, but thissubsection does not apply to disclosures in actions or enforcementproceedings pursuant to this article.
(7) If a creditor contracts with an outside vendor to provide aservice that would otherwise be undertaken internally by the creditorand be subject to the department's routine examination procedures,the person that provides the service to the creditor shall, at therequest of the director, submit to an examination by the department.If the director determines that an examination under this subsectionis necessary or desirable, the examination may be made at theexpense of the person to be examined. If the person to be examinedunder this subsection refuses to permit the examination to be made,the director may order any creditor that is licensed under this articleand that receives services from the person refusing the examinationto: (a) discontinue receiving one (1) or more services from theperson; or
(b) otherwise cease conducting business with the person.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.48; P.L.122-1994, SEC.34; P.L.45-1995, SEC.16; P.L.10-2006,SEC.9 and P.L.57-2006, SEC.9; P.L.213-2007, SEC.15;P.L.217-2007, SEC.14; P.L.35-2010, SEC.66.
IC 24-4.5-6-106.5
Powers of director
Sec. 106.5. To carry out the purposes of this section, the directormay:
(a) retain attorneys, accountants, or other professionals andspecialists as examiners, auditors, or investigators to conduct orassist in the conduct of examinations or investigations;
(b) enter into agreements or relationships with othergovernment officials or regulatory associations to improveefficiencies and reduce regulatory burden by sharing:
(i) resources;
(ii) standardized or uniform methods or procedures; and
(iii) documents, records, information, or evidence obtainedunder this section;
(c) use, hire, contract, or employ public or privately availableanalytical systems, methods, or software to examine orinvestigate a licensee, an individual, or a person subject to thisarticle;
(d) accept and rely on examination or investigation reportsmade by other government officials, in or outside Indiana; or
(e) accept audit reports made by an independent certified publicaccountant for the licensee, individual, or person subject to thisarticle in the course of that part of the examination covering thesame general subject matter as the audit and may incorporatethe audit report in the report of the examination, report ofinvestigation, or other writing of the director.
As added by P.L.35-2010, SEC.67.
IC 24-4.5-6-107
Applicability of laws governing administrative orders and rules;venue; emergency rulemaking authority
Sec. 107. Except as otherwise provided, IC 4-21.5-3 governs allagency action taken by the department under this chapter orIC 24-4.5-3-501 through IC 24-4.5-3-513. All proceedings foradministrative review under IC 4-21.5-3 or judicial review underIC 4-21.5-5 shall be held in Marion County. The provisions ofIC 4-22-2 prescribing procedures for the adoption of rules byagencies shall apply to the adoption of rules by the department offinancial institutions under this article. However, if the departmentdeclares an emergency in the document containing the rule, it mayadopt rules permitted by this chapter under IC 4-22-2-37.1.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.31-1985,
SEC.48; P.L.7-1987, SEC.108; P.L.1-1990, SEC.243; P.L.14-1992,SEC.49; P.L.35-2010, SEC.68.
IC 24-4.5-6-107.5
Prohibited acts
Sec. 107.5. It is a violation of this article for a person orindividual subject to this article to:
(a) directly or indirectly employ any scheme, device, or artificeto defraud or mislead borrowers or lenders or to defraud anyperson;
(b) engage in any unfair or deceptive practice toward anyperson;
(c) obtain property by fraud or misrepresentation;
(d) solicit or enter into a contract with a borrower that providesin substance that the person or individual subject to this articlemay earn a fee or commission through "best efforts" to obtaina loan even though no loan is actually obtained for theborrower;
(e) solicit, advertise, or enter into a contract for specific interestrates, points, or other financing terms unless the terms areactually available at the time of soliciting, advertising, orcontracting;
(f) conduct any business covered by this article without holdinga valid license as required under this article, or assist or aid andabet any person in the conduct of business under this articlewithout a valid license as required under this article;
(g) fail to make disclosures as required by this article and anyother applicable state or federal law, including regulationsunder that law;
(h) fail to comply with this article or rules adopted under thisarticle, or fail to comply with any other state or federal law,rule, or regulation, applicable to any business authorized orconducted under this article;
(i) make, in any manner, any false or deceptive statement orrepresentation, including, with regard to the rates, points, orother financing terms or conditions for a mortgage transaction,or engage in bait and switch advertising;
(j) negligently make any false statement or knowingly andwillfully make any omission of material fact in connection withany information or reports filed with a governmental agency orthe NMLSR or in connection with any investigation conductedby the director or another governmental agency;
(k) make any payment, threat, or promise, directly or indirectly,to any person for the purposes of influencing the independentjudgment of the person in connection with a mortgagetransaction, or make any payment, threat, or promise, directlyor indirectly, to any appraiser of a property, for the purposes ofinfluencing the independent judgment of the appraiser withrespect to the value of the property;
(l) collect, charge, attempt to collect or charge, or use or
propose any agreement purporting to collect or charge any feeprohibited by this article;
(m) cause or require a borrower to obtain property insurancecoverage in an amount that exceeds the replacement cost of theimprovements as established by the property insurer;
(n) fail to account truthfully for money belonging to a party toa mortgage transaction; or
(o) knowingly withhold, abstract, remove, mutilate, destroy, orsecrete any books, records, computer records, or otherinformation subject to examination under this article.
As added by P.L.35-2010, SEC.69.
IC 24-4.5-6-108
Cease and desist orders; judicial review or enforcementproceedings; record; appeal; unconscionable or fraudulent conductsubject to injunction
Sec. 108. (1) After notice and an opportunity to be heard, thedepartment may order a creditor, or a person acting on behalf of thecreditor, to cease and desist from engaging in violations of thisarticle. A respondent aggrieved by an order of the department mayobtain judicial review of the order and the department may obtain anorder of the court for enforcement of its order in any civil court. Theproceeding for review or enforcement is initiated by filing a petitionin the court. Copies of the petition shall be served upon all parties ofrecord.
(2) Within thirty (30) days after service of the petition for reviewupon the department, or within any further time the court may allow,the department shall transmit to the court the original or a certifiedcopy of the entire record upon which the order is based, includingany transcript of testimony, which need not be printed. By stipulationof all parties to the review proceeding, the record may be shortened.After hearing the court may (a) reverse or modify the order if thefindings of fact of the department are clearly erroneous in view of thereliable, probative, and substantial evidence on the whole record, (b)grant any temporary relief or restraining order it deems just, and (c)enter an order enforcing, modifying, and enforcing as modified, orsetting aside in whole or in part the order of the department, orremanding the case to the department for further proceedings.
(3) An objection not urged at the hearing shall not be consideredby the court unless the failure to urge the objection is excused forgood cause shown. A party may move the court to remand the caseto the department in the interest of justice for the purpose ofadducing additional specified and material evidence and seekingfinding thereon upon good cause shown for the failure to adduce thisevidence before the department.
(4) The jurisdiction of the court shall be exclusive and its finaljudgment or decree shall be subject to review by the court on appealin the same manner and form and with the same effect as in appealsfrom a final judgment or decree. The department's copy of thetestimony shall be available at reasonable times to all parties for
examination without cost.
(5) A proceeding for review under this section must be initiatedwithin thirty (30) days after a copy of the order of the department isreceived. If no proceeding is so initiated, the department may obtaina decree of the civil court for enforcement of its order upon ashowing that an order was issued in compliance with this section,that no proceeding for review was initiated within thirty (30) daysafter copy of the order was received, and that the respondent issubject to the jurisdiction of the court.
(6) With respect to unconscionable agreements or fraudulent orunconscionable conduct by the respondent, the department may notissue an order pursuant to this section but may bring a civil action foran injunction (IC 24-4.5-6-111).
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.50; P.L.35-2010, SEC.70.
IC 24-4.5-6-109
Assurance of discontinuance
Sec. 109. Assurance of Discontinuance _ If it is claimed that aperson has engaged in conduct subject to an order by the department(IC 24-4.5-6-108) or by a court (IC 24-4.5-6-110 throughIC 24-4.5-6-112), the department may accept an assurance in writingthat the person will not engage in the conduct in the future. If aperson giving an assurance of discontinuance fails to comply with itsterms, the assurance is evidence that prior to the assurance heengaged in the conduct described in the assurance.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.51.
IC 24-4.5-6-110
Injunctions against violations
Sec. 110. The department may bring a civil action to restrain aperson from violating this article or another state or federal law orregulation, and for other appropriate relief.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.52; P.L.35-2010, SEC.71.
IC 24-4.5-6-111
Injunctions against unconscionable agreements and fraudulent orunconscionable conduct
Sec. 111. Injunctions Against Unconscionable Agreements andFraudulent or Unconscionable Conduct _ (1) The department maybring a civil action to restrain a creditor or a person acting in behalfof a creditor from engaging in a course of:
(a) making or enforcing unconscionable terms or provisions ofconsumer credit sales, consumer leases, or consumer loans;
(b) fraudulent or unconscionable conduct in inducing debtors toenter into consumer credit sales, consumer leases, or consumerloans; or
(c) fraudulent or unconscionable conduct in the collection of
debts arising from consumer credit sales, consumer leases, orconsumer loans.
(2) In an action brought pursuant to this section the court maygrant relief only if it finds:
(a) that the respondent has made unconscionable agreements orhas engaged or is likely to engage in a course of fraudulent orunconscionable conduct;
(b) that the agreements or conduct of the respondent has causedor is likely to cause injury to consumers; and
(c) that the respondent has been able to cause or will be able tocause the injury primarily because the transactions involved arecredit transactions.
(3) In applying this section, consideration shall be given to eachof the following factors, among others:
(a) belief by the creditor at the time consumer credit sales,consumer leases, or consumer loans are made that there was noreasonable probability of payment in full of the obligation bythe debtor;
(b) in the case of consumer credit sales or consumer leases,knowledge by the seller or lessor at the time of the sale or leaseof the inability of the buyer or lessee to receive substantialbenefits from the property or services sold or leased;
(c) in the case of consumer credit sales or consumer leases,gross disparity between the price of the property or servicessold or leased and the value of the property or servicesmeasured by the price at which similar property or services arereadily obtainable in credit transactions by like buyers orlessees;
(d) the fact that the creditor contracted for or received separatecharges for insurance with respect to consumer credit sales orconsumer loans with the effect of making the sales or loans,considered as a whole, unconscionable; and
(e) the fact that the respondent has knowingly taken advantageof the inability of the debtor reasonably to protect his interestsby reason of physical or mental infirmities, ignorance, illiteracyor inability to understand the language of the agreement, orsimilar factors.
(4) In an action brought pursuant to this section, a charge orpractice expressly permitted by this Article is not in itselfunconscionable.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.53; P.L.122-1994, SEC.35.
IC 24-4.5-6-112
Temporary relief
Sec. 112. Temporary Relief _ With respect to an action broughtto enjoin violations of the Article (IC 24-4.5-6-110) orunconscionable agreements or fraudulent or unconscionable conduct(IC 24-4.5-6-111), the department may apply to the court forappropriate temporary relief against a respondent, pending final
determination of proceedings. If the court finds after a hearing heldupon notice to the respondent that there is reasonable cause tobelieve that the respondent is engaging in or is likely to engage inconduct sought to be restrained, it may grant any temporary relief orrestraining order it deems appropriate.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.54.
IC 24-4.5-6-113
Civil actions by department; civil penalties for violations
Sec. 113. (1) After demand, the department may bring a civilaction against a creditor for making or collecting charges in excessof those permitted by this article. An action may relate totransactions with more than one debtor. If it is found that an excesscharge has been made, the court shall order the respondent to refundto the debtor or debtors the amount of the excess charge. If a creditorhas made an excess charge in deliberate violation of or in recklessdisregard for this article, or if a creditor has refused to refund anexcess charge within a reasonable time after demand by the debtoror the department, the court may also order the respondent to pay tothe debtor or debtors a civil penalty in an amount determined by thecourt not in excess of the greater of either the amount of the creditservice or loan finance charge or ten (10) times the amount of thecharge. Refunds and penalties to which the debtor is entitledpursuant to this subsection may be set off against the debtor'sobligation. If a debtor brings an action against a creditor to recoveran excess charge or civil penalty, an action by the department torecover for the same excess charge or civil penalty shall be stayedwhile the debtor's action is pending and shall be dismissed if thedebtor's action is dismissed with prejudice or results in a finaljudgment granting or denying the debtor's claim. With respect toexcess charges arising from sales made pursuant to revolving chargeaccounts or from loans made pursuant to revolving loan accounts, noaction pursuant to this subsection may be brought more than two (2)years after the time the excess charge was made. With respect toexcess charges arising from other consumer credit sales or consumerloans, no action pursuant to this subsection may be brought morethan one (1) year after the due date of the last scheduled payment ofthe agreement pursuant to which the charge was made. If the creditorestablishes by a preponderance of evidence that a violation isunintentional or the result of a bona fide error, no liability to pay apenalty shall be imposed under this subsection.
(2) The department may bring a civil action against a creditor ora person acting in his behalf to recover a civil penalty for willfullyviolating this article, and if the court finds that the defendant hasengaged in a course of repeated and willful violations of this article,it may assess a civil penalty of no more than five thousand dollars($5,000). No civil penalty pursuant to this subsection may beimposed for violations of this article occurring more than two (2)years before the action is brought or for making unconscionable
agreements or engaging in a course of fraudulent or unconscionableconduct.
(3) If the department determines, after notice and opportunity forthe person to be heard, that a person has violated this article, thedepartment may, in addition to or instead of all other remediesavailable under this section, impose upon the person a civil penaltynot greater than ten thousand dollars ($10,000) per violation.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.55; P.L.213-2007, SEC.16; P.L.217-2007, SEC.15;P.L.35-2010, SEC.72.
IC 24-4.5-6-114
Repealed
(Repealed by P.L.35-2010, SEC.209.)
IC 24-4.5-6-115
Debtor's remedies not affected
Sec. 115. Debtor's Remedies Not Affected _ The grant of powersto the department in this Article does not affect remedies availableto debtors under this Article or under other principles of law orequity.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.57.
IC 24-4.5-6-116
Venue
Sec. 116. Venue _ The department may bring actions orproceedings in a court in a county in which an act on which theaction or proceeding is based occurred or in a county in whichrespondent resides or transacts business or in a county otherwiseauthorized by rule or venue laws.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.14-1992,SEC.58.
IC 24-4.5-6-117
"Civil court" defined
Sec. 117. As used in this article, "civil court" means any court ofIndiana having civil jurisdiction.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by P.L.1-1990,SEC.244.
IC 24-4.5-6-119
Violations by certain individuals; notice of charges; felonies; civilpenalties
Sec. 119. (a) Subject to subsection (b), if the director determinesthat a director, an officer, or an employee of a creditor:
(1) has committed a violation of a statute, a rule, a final ceaseand desist order, a condition imposed in writing by the directorin connection with the grant of an application or other requestby the creditor, or a written agreement between the creditor and
the director or the department;
(2) has committed fraudulent or unconscionable conduct; or
(3) has been convicted of or has pleaded guilty or nolocontendere to a felony under the laws of Indiana or any otherjurisdiction;
the director may issue and serve upon the person a notice of chargesand of the director's intent to issue an order removing the personfrom the person's office or employment, an order prohibitingparticipation by the person in the conduct of the affairs of anycreditor, or an order both removing the person and prohibiting theperson's participation.
(b) A violation, practice, or breach described in subsection (a) issubject to the authority of the director under subsection (a) if thedirector finds any of the following:
(1) The interests of the creditor's customers could be seriouslyprejudiced by reason of the violation, practice, or breach.
(2) The violation, practice, or breach involves personaldishonesty on the part of the officer, director, or employeeinvolved.
(3) The violation, practice, or breach demonstrates a willful orcontinuing disregard by the officer, director, or employee forstate or federal law and regulations, and for the consumerprotections contained in this article.
(c) A person who:
(1) has been convicted of; or
(2) has pleaded guilty or nolo contendere to;
a felony under the laws of Indiana or any other jurisdiction may notserve as an officer, a director, or an employee of a creditor, or servein any similar capacity, unless the person obtains the written consentof the director.
(d) A creditor that willfully permits a person to serve the creditorin violation of subsection (c) is subject to a civil penalty of fivehundred dollars ($500) for each day the violation occurs.
As added by P.L.35-2010, SEC.73.
IC 24-4.5-6-120
Notice of charges; contents; hearing; final order; suspension orprohibition pending final order; official record
Sec. 120. (a) A notice issued under section 119 of this chaptermust:
(1) be in writing;
(2) contain a statement of:
(A) the facts constituting the alleged violation, practice, orbreach;
(B) the facts alleged in support of the violation, practice, orbreach; and
(C) the director's intention to issue an order under section122(a) of this chapter;
(3) be delivered to the board of directors of the creditor;
(4) be delivered to the officer, director, or employee to which
the notice applies;
(5) specify the procedures that must be followed to initiate ahearing to contest the alleged violation, practice, or breach; and
(6) if the director suspends or prohibits the officer, director, oremployee from participation in the affairs of the creditor asdescribed under subsection (e), a statement of the suspension orprohibition.
(b) If a hearing is requested not later than ten (10) days afterservice of the notice described under subsection (a), the departmentshall hold a hearing concerning the alleged violation, practice, orbreach. The hearing shall be held not later than forty-five (45) daysafter receipt of the request. The department, based on the evidencepresented at the hearing, shall enter a final order in accordance withsection 122 of this chapter.
(c) If no hearing is requested within the period of time specifiedin subsection (b), the director may proceed to issue a final orderunder section 122 of this chapter on the basis of the facts set forth inthe notice described under subsection (a).
(d) An officer, director, or employee of a creditor who is removedfrom a position under a removal order under section 122 of thischapter that has become final may not, without the approval of thedirector, participate in the conduct of the affairs of a licenseedescribed under IC 24-4.5-3.
(e) The director may, for the protection of the creditor or theinterests of the creditor's customers, suspend from office or prohibitfrom participation in the affairs of the creditor an officer, a director,or an employee of a creditor who is the subject of a written noticeserved by the director under section 119(a) of this chapter. Asuspension or prohibition under this subsection becomes effectiveupon service of the notice under section 119(a) of this chapter.Unless stayed by a court in a proceeding authorized by subsection(f), the suspension or prohibition remains in effect pendingcompletion of the proceedings related to the notice served undersection 119(a) of this chapter and until the effective date of an orderentered by the department under subsection (b) or the director undersubsection (c). If the director suspends or prohibits participation ofan officer, a director, or an employee under this subsection, copiesof the notice shall also be served upon the creditor or affiliate ofwhich the person is an officer, a director, or an employee.
(f) Not more than fifteen (15) days after an officer, a director, oran employee has been suspended from office or prohibited fromparticipation in the conduct of the affairs of the creditor or affiliateunder subsection (e), the officer, director, or employee may apply toa court having jurisdiction for a stay of the suspension or prohibitionpending completion of the proceedings related to the notice servedunder section 119(a) of this chapter. The court may stay a suspensionof prohibition of the officer, director, or employee.
(g) The department shall maintain an official record of aproceeding under this chapter.
As added by P.L.35-2010, SEC.74.
IC 24-4.5-6-121
Consent agreement; notice of charges not required
Sec. 121. If the director enters into a consent to a final order witha director, an officer, or an employee, the director is not required toissue and serve a notice of charges upon the director, officer, oremployee under section 119 of this chapter. A consent agreementmay be negotiated and entered into before or after the issuance of anotice of charges. The director shall provide a copy of the consentorder to the board of directors of the creditor.
As added by P.L.35-2010, SEC.75.
IC 24-4.5-6-122
Final order; remedies; consent presumed; confidentiality
Sec. 122. (a) Subject to section 120 of this chapter, if, after ahearing described in section 120(b) of this chapter, the departmentdetermines that a director, an officer, or an employee of a creditorhas committed an act described in section 119 of this chapter, thedepartment may issue a final order. If a hearing is not requestedwithin the time specified in section 120(b) of this chapter, thedirector may issue a final order on the basis of the facts set forth inthe written notice served under section 119(a) of this chapter.
(b) Unless the director has entered into a consent agreementdescribed in section 121 of this chapter, a final order must includeseparately stated findings of fact and conclusions of law for allaspects of the order.
(c) In a final order under this section, the department or thedirector, as appropriate, may order one (1) or more of the followingwith respect to an officer, a director, or an employee of a creditor:
(1) The removal of the officer, director, or employee from theperson's office, position, or employment.
(2) A prohibition against any participation by the officer,director, or employee in the conduct of the affairs of anycreditor.
(3) If the subject of the order is an officer or a director of acreditor, and subject to section 124 of this chapter, theimposition of a civil penalty not to exceed fifteen thousanddollars ($15,000) for each practice, violation, or act that:
(A) is described in section 119 of this chapter; and
(B) found to exist by the department or the director.
(d) A final order shall be issued in writing not later than ninety(90) days after conclusion of a hearing held under section 120(b) ofthis chapter, unless this period is waived or extended with the writtenconsent of all parties or for good cause shown.
(e) If the officer, director, or employee does not appearindividually or by an authorized representative at a hearing heldunder section 120(b) of this chapter, the officer, director, oremployee is considered to have consented to the issuance of a finalorder.
(f) The director may keep a final order confidential if the directordetermines that the immediate release of the order would endanger
the stability of the creditor. However, after two (2) years followingthe date that an order is issued, a final order is no longer confidential.
(g) The remedies provided in this chapter are in addition to otherremedies contained in this article.
As added by P.L.35-2010, SEC.76.
IC 24-4.5-6-123
Final order; effective date; authority of department or court tostay, modify, or vacate
Sec. 123. (a) A final order issued under section 122 of this chapteris effective the eleventh day after the date the order is served.However, a final order issued upon consent under section 121 of thischapter is effective at the time specified in the order.
(b) A final order remains effective and enforceable as provided inthe order.
(c) The department or a reviewing court may stay, modify, orvacate a final order.
As added by P.L.35-2010, SEC.77.
IC 24-4.5-6-124
Factors for determining amount of civil penalty; indemnificationby creditor prohibited; deposit of civil penalties in financialinstitutions fund
Sec. 124. (a) The director or the department, as appropriate, shallconsider the following factors in determining the amount of a civilpenalty that should be assessed against a director or an officer undersection 122(c)(3) of this chapter:
(1) The appropriateness of the civil penalty with respect to thefinancial resources and good faith of the individual charged.
(2) The gravity of the practice, violation, or breach.
(3) The history of previous practices, violations, or breaches.
(4) The economic benefit derived by the individual from thepractice, violation, or breach.
(5) Other factors that justice requires.
(b) A creditor may not indemnify a director or an officer for acivil penalty imposed against the director or officer under thissection.
(c) Civil penalties shall be deposited in the financial institutionsfund established by IC 28-11-2-9.
As added by P.L.35-2010, SEC.78.
IC 24-4.5-6-125
Authority of director to enforce orders, agreements, or conditionsin court
Sec. 125. The director may enforce any of the following byapplying for appropriate relief to a court having jurisdiction:
(1) An order issued under section 121 or 122 of this chapter.
(2) A written agreement entered into by the director or thedepartment and a director, an officer, or an employee of acreditor. (3) Any condition imposed in writing by the director or thedepartment on a director, an officer, or an employee of acreditor.
As added by P.L.35-2010, SEC.79.
(Part 2. Notification and Fees)
IC 24-4.5-6-201
Applicability of notification requirements and fees
Sec. 201. (1) This section and sections 202 and 203 of this chapterapply to a person, including a depository institution, but notincluding a collection agency licensed under IC 25-11-1, engaged inIndiana in any of the following:
(a) Making consumer credit sales, consumer leases, orconsumer loans.
(b) Taking assignments of rights against debtors that arise fromsales, leases, or loans by a person having an office or a place ofbusiness in Indiana.
(c) Undertaking direct collection of payments from the debtorsor enforcement of rights against the debtors.
(d) Placing consumer credit insurance, receiving commissionsfor consumer credit insurance, or acting as a limited line creditinsurance producer in the sale of consumer credit insurance.
(e) Selling insurance or other benefits, the charges for which areapproved by the department as additional charges underIC 24-4.5-2-202 or IC 24-4.5-3-202.
(2) This section and sections 202 and 203 of this chapter are notapplicable to a seller whose credit sales consist entirely of sales madepursuant to a seller credit card issued by a person other than theseller if the issuer of the card has complied with the provisions ofthis section and sections 202 and 203 of this chapter.
(3) This section and sections 202 and 203 of this chapter apply toa seller whose credit sales are made using credit cards that:
(a) are issued by a lender;
(b) are in the name of the seller; and
(c) can be used by the buyer or lessee only for purchases orleases at locations of the named seller.
(Formerly: Acts 1971, P.L.366, SEC.7; Acts 1972, P.L.182, SEC.3.)As amended by P.L.152-1986, SEC.72; P.L.14-1992, SEC.59;P.L.122-1994, SEC.36; P.L.176-1996, SEC.10; P.L.178-2003,SEC.11; P.L.10-2006, SEC.10 and P.L.57-2006, SEC.10;P.L.213-2007, SEC.17; P.L.217-2007, SEC.16; P.L.35-2010,SEC.80.
IC 24-4.5-6-202
Notification
Sec. 202. (1) Persons that are subject to this section and sections201 and 203 of this chapter shall file notification with the departmentwithin thirty (30) days after commencing business in Indiana andthereafter on an annual basis, on the date set forth in subsection (2).
The notification shall state the:
(a) name of the person;
(b) name in which business is transacted if different fromsubdivision (a);
(c) address of principal office, which may be outside Indiana;and
(d) address of all offices or retail stores, if any, in Indiana atwhich consumer credit sales, consumer leases, or consumerloans are made, or in the case of a person taking assignments ofobligations, the offices or places of business within Indiana atwhich business is transacted.
(2) A person required to be licensed under this article shall file thenotification required by subsection (1) not later than December 31 ofeach year. All other persons subject to this section shall file thenotification required by subsection (1) not later than January 31 ofeach year.
(3) Persons subject to sections 201 and 203 of this chapter andthis section shall notify the department not later than thirty (30) daysafter the person:
(a) has a change in name, address, or principals;
(b) opens a new branch, closes an existing branch, or relocatesan existing branch;
(c) files for bankruptcy or reorganization;
(d) is notified that the person is subject to revocation orsuspension proceedings by a state or governmental authoritywith regard to the person's activities; or
(e) has been convicted of or pleaded guilty or nolo contendereto a felony involving fraud, deceit, or misrepresentation underthe laws of Indiana or any other jurisdiction.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended byP.L.152-1986, SEC.73; P.L.14-1992, SEC.60; P.L.122-1994,SEC.37; P.L.63-2001, SEC.4 and P.L.134-2001, SEC.4;P.L.213-2007, SEC.18; P.L.217-2007, SEC.17; P.L.35-2010,SEC.81.
IC 24-4.5-6-203
Fees
Sec. 203. (1) Persons required to file notification who are sellers,lessors, or lenders shall pay a fee in an amount and at intervals to beprescribed by the director under IC 28-11-3-5. The fee shall be auniform amount for each one hundred thousand dollars ($100,000),or part thereof, in excess of one hundred thousand dollars($100,000), of the original unpaid balances arising from consumercredit sales, consumer leases, and consumer loans made in Indianaand held either by the seller, lessor, or lender for more than thirty(30) days after the inception of the sale, lease, or loan giving rise tothe obligations, or by an assignee who has not filed notification. Arefinancing of a sale, lease, or loan resulting in an increase in theamount of an obligation is a new sale, lease, or loan to the extent ofthe increase. In prescribing the fee, the department shall consider the
costs and expense incurred or estimated to be incurred by thedepartment in the administration of this article, including, but notlimited to, the supervision, regulation, and examination of personssubject to the provisions of the article.
(2) Persons required to file notification who are assignees shallpay a fee as prescribed and fixed by the department under subsection(1) on the unpaid balances at the time of the assignment ofobligations arising from consumer credit sales, consumer leases, andconsumer loans made in Indiana taken by assignment during thepreceding calendar year, but an assignee need not pay a fee withrespect to an obligation on which the assignor or other person hasalready paid a fee.
(3) Persons required to file notification who are assignors shallpay a fee as prescribed by the department under subsection (1) on theunpaid balances at the time of the assignment of obligations arisingfrom consumer credit sales, consumer leases, and consumer loansmade in Indiana during the preceding calendar year unless theassignee has already paid the fees.
(4) Persons required to renew a license under IC 24-4.5-3-503may deduct the fees paid under IC 24-4.5-3-503(7)(a) throughIC 24-4.5-3-503(7)(c) from fees paid under this section.
(5) A person that is required to file notification underIC 24-4.5-6-202 shall pay a fee at the same rate as prescribed andfixed by the department under subsection (1) on the original unpaidbalances of all closed end credit obligations originating from theperson's place of business during the time preceding the notificationas specified under subsection (1), unless the fees for the obligationshave been paid by another person.
(Formerly: Acts 1971, P.L.366, SEC.7.) As amended by Acts 1977,P.L.269, SEC.1; P.L.247-1983, SEC.23; P.L.14-1992, SEC.61;P.L.122-1994, SEC.38; P.L.213-2007, SEC.19; P.L.217-2007,SEC.18; P.L.90-2008, SEC.13.
IC 24-4.5-6-204
Nonapplicability of licensing and notification requirements toattorneys' services
Sec. 204. IC 24-4.5-3-502, IC 24-4.5-6-201, IC 24-4.5-6-202, andIC 24-4.5-6-203 are not applicable to services performed byattorneys.
As added by P.L.153-1986, SEC.3. Amended by P.L.213-2007,SEC.20; P.L.217-2007, SEC.19.