House Bill 787

AN ACT TO AMEND SECTION 75-17-27, MISSISSIPPI CODE OF 1972, TO MODIFY THE LATE PAYMENT CHARGES PERMITTED ON CERTAIN TRANSACTIONS; TO AMEND SECTION 63-19-35, MISSISSIPPI CODE OF 1972, TO CONFORM TO THE PRECEDING PROVISION THE DELINQUENCY AND COLLECTION CHARGE PROVISIONS APPLICABLE TO COMMERCIAL VEHICLE SALES CONTRACTS AND MOTOR VEHICLE SALES FINANCE CONTRACTS; TO AMEND SECTION 75-67-115, MISSISSIPPI CODE OF 1972, TO INCREASE THE AMOUNT THAT THE COMMISSIONER OF BANKING AND CONSUMER FINANCE MAY CHARGE LICENSEES UNDER THE SMALL LOAN REGULATORY LAW FOR EXPENSES OF EXAMINATIONS; TO AMEND SECTION 75-67-215, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE COMMISSIONER TO ENTER ORDERS THAT REQUIRE PERSONS TO REFRAIN FROM VIOLATING PROVISIONS OF THE SMALL LOAN PRIVILEGE TAX LAW; TO CREATE A NEW SECTION TO BE CODIFIED AS SECTION 75-67-139, MISSISSIPPI CODE OF 1972, TO AUTHORIZE MUNICIPALITIES TO ENACT ORDINANCES THAT ARE IN COMPLIANCE WITH, BUT NOT MORE RESTRICTIVE THAN, THE PROVISIONS OF THE SMALL LOAN REGULATORY LAW; TO CREATE A NEW SECTION TO BE CODIFIED AS SECTION 75-67-247, MISSISSIPPI CODE OF 1972, TO AUTHORIZE MUNICIPALITIES TO ENACT ORDINANCES THAT ARE IN COMPLIANCE WITH, BUT NOT MORE RESTRICTIVE THAN, THE PROVISIONS OF THE SMALL LOAN PRIVILEGE TAX LAW; TO REPEAL SECTION 75-17-15, MISSISSIPPI CODE OF 1972, WHICH AUTHORIZES SMALL LOAN LICENSEES TO COLLECT A DEFAULT CHARGE ON CERTAIN TRANSACTIONS; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 75-17-27, Mississippi Code of 1972, is amended as follows:

75-17-27. A late payment charge, not exceeding Ten Dollars ($10.00) or five percent (5%) of the amount of any delinquency, whichever is greater, if contracted for in writing, shall not be considered a finance charge, but no such charge shall be made unless the delinquency is more than ten (10) days past due; * * * however, the late payment charge may be collected only one (1) time on a specific installment and no late payment charge may be collected on a partial payment resulting from the deduction of a late payment charge from a regular scheduled payment. On loans of One Hundred Thousand Dollars ($100,000.00) or less having a stated maturity of five (5) years or less, the late payment charge shall in no event exceed Fifty Dollars ($50.00).

SECTION 2. Section 63-19-35, Mississippi Code of 1972, is amended as follows:

63-19-35. The holder may, if the contract or refinancing agreement so provides, collect a delinquency and collection charge on a contract * * * in an amount not exceeding that permitted in Section 75-17-27. The contract may provide for the payment of court costs and of attorney's fee not exceeding fifteen per cent (15%) of the amount actually due and unpaid at the time the balance of the contract is accelerated and the entire amount thereof is declared to be due, if the same is referred to an attorney for collection. However, no such attorney's fee may be charged or collected where the attorney to whom the contract was referred for collection is a salaried employee of the holder of the contract.

SECTION 3. Section 75-67-115, Mississippi Code of 1972, is amended as follows:

75-67-115. The commissioner may charge the licensee an examination fee in an amount not less than Three Hundred Dollars ($300.00) nor more than Six Hundred Dollars ($600.00) for each office or location within the State of Mississippi, plus any actual expenses incurred while examining the licensee's records or books that are located outside the State of Mississippi. However, in no event shall a licensee be examined more than once in a two-year period unless for cause shown based upon consumer complaint and/or other exigent reasons as determined by the commissioner.

All expense fees paid to the commissioner shall be deposited by the commissioner in the State Treasury in a special and separate fund to be known as the "Consumer Finance Fund."

SECTION 4. Section 75-67-215, Mississippi Code of 1972, is amended as follows:

75-67-215. (1) If any person * * * engages in business as provided for in this article without paying the license fee provided for in this article before commencing business or before the expiration of the person's current license, as the case may be, then the person shall be liable for the full amount of the license fee plus a penalty in an amount not to exceed Twenty-five Dollars ($25.00) for each day that the person has engaged in the business without a license or after the expiration of a license.

(2) The commissioner may, after notice and hearing as defined in Section 75-67-237 in cases of revocation of license, impose a civil penalty against any licensee if the licensee is adjudged by the commissioner to be in willful violation of the provisions of this article. The civil penalty shall not exceed Five Hundred Dollars ($500.00) per violation and shall be deposited into the Consumer Finance Fund of the Department of Banking and Consumer Finance. Any licensee who has been imposed a civil penalty by the commissioner may, within twenty (20) days after the fine is imposed, appeal to the circuit court of the county where the business is being conducted, as in cases from an order of a lesser tribunal. The trial on appeal shall be de novo.

(3) When the commissioner has reasonable cause to believe that a person is violating any provision of this article, the commissioner, in addition to and without prejudice to the authority provided elsewhere in this article, may enter an order requiring the person to stop or to refrain from the violation. The commissioner may sue in any circuit court of the state having jurisdiction and venue to enjoin the person from engaging in or continuing the violation or from doing any act in furtherance of the violation. In such an action, the court may enter an order or judgment awarding a preliminary or permanent injunction.

SECTION 5. The following shall be codified as Section 75-67-139, Mississippi Code of 1972:

75-67-139. Municipalities and counties in this state may enact ordinances that are in compliance with, but not more restrictive than, the provisions of this article. Any order, ordinance or regulation existing on the effective date of House Bill No. 787, 2004 Regular Session, or any order, ordinance or regulation enacted after the effective date of House Bill No. 787, 2004 Regular Session, that conflicts with any of the provisions of this article shall be void to the extent of the conflict.

SECTION 6. The following shall be codified as Section 75-67-247, Mississippi Code of 1972:

75-67-247. Municipalities and counties in this state may enact ordinances that are in compliance with, but not more restrictive than, the provisions of this article. Any order, ordinance or regulation existing on the effective date of House Bill No. 787, 2004 Regular Session, or any order, ordinance or regulation enacted after the effective date of House Bill No. 787, 2004 Regular Session, that conflicts with any of the provisions of this article shall be void to the extent of the conflict.

SECTION 7. Section 75-17-15, Mississippi Code of 1972, which

authorizes small loan licensees to collect a default charge on certain transactions, is repealed.

SECTION 8. This act shall take effect and be in force from and after its passage.