§ 45-17-112 — Retention of records - Operating costs - Deferred presentment procedures

Tennessee § 45-17-112

• Jurisdiction: Tennessee
• Title: 45

Text

(a) Each licensee shall keep and use in its business any books, accounts and records the commissioner may require to carry into effect this chapter and the administrative regulations issued hereunder. Every licensee shall preserve the books, accounts and records for at least two (2) years. Any licensee, after receiving the prior written approval of the commissioner, may maintain records at a location within or outside this state. (b) A licensee may charge a fee to defray operational costs, including, but not limited to, investigating the checking account and copying required documents, photographing the person signing the check, securing the check and customer records in a safe, fire-proof place, maintaining records as required by this chapter, maintaining required capital and liquidity, processing, documenting and closing the transaction, and for other expenses and losses. The fee authorized by this subsection (b) shall not exceed fifteen percent (15%) of the face amount of the check. The fee, when made and collected, shall not be deemed interest for any purpose of law. (c) Before a licensee shall present for payment or deposit a check accepted by the licensee, the check shall be endorsed with the actual name under which the licensee is doing business. (d) Any agreement for deferred presentment of a check must be in writing and signed by the maker of the check. The maker of a check shall have the right to redeem the check from the licensee before the agreed date of deposit upon payment to the licensee of the amount of the check. A licensee shall not defer presentment of any personal check for more than thirty-one (31) calendar days after the date the check is tendered to the licensee. (e) Within five (5) business days after being advised by the payer financial institution that a check or draft has been altered, forged, stolen, obtained through fraudulent or illegal means, negotiated without proper legal authority, or represents the proceeds of illegal activity, the licensee shall notify the district attorney general for the district in which the check was received or the customer resides. If a check or draft is returned to the licensee by the payer financial institution for any of these reasons, the licensee shall not release the check, draft or money order without the consent of the district attorney general or other investigating law enforcement authority. (f) A licensee shall comply with all provisions of state and federal law regarding cash transactions and cash transaction reporting. (g) A licensee shall provide each prospective customer, before consummation of the deferred presentment agreement, a written explanation, in clear, understandable language, of the fees to be charged by the licensee, and the date on which the check will be deposited or presented by the licensee. The commissioner may promulgate rules establishing additional requirements in order to assure complete and accurate disclosure. The department of financial institutions shall promulgate rules requiring each licensee to issue a standardized consumer notification and disclosure form in compliance with federal truth-in-lending laws prior to entering into any deferred presentment transaction. The required style, content and method of executing the form shall be specifically prescribed by the rules and shall be designed to ensure that the consumer, prior to entering into a deferred presentment transaction, receives and acknowledges an accurate and complete notification and disclosure of the itemized and total amounts of all fees and other costs that will or potentially could be imposed as a result of the agreement. Enactment of this subsection (g) shall not create any inference that a particular method of disclosure was required prior to October 1, 1997. (h) A licensee shall issue a receipt to each person for whom a licensee defers deposit of a check. The receipt shall include the information described in subsection (g). (i) If a check is returned to the licensee from a payer financial institution due to insufficient funds, closed account, or a stop-payment order, the licensee shall have the right to all civil means available and allowed by law to collect the check, including the right to collect court costs incurred in bringing the civil action as authorized in § 47-29-101(a)(4), (b) and (c) . However, no licensee shall have the authority to assess a handling charge against the maker or drawer authorized by § 47-29-102 or the right to collect attorney's fees relating to the check. No other provisions of title 47, chapter 29, are applicable to a person licensed under this chapter. No individual who issues a personal check to a licensee under this chapter shall be convicted under § 39-14-121 . (j) No licensee may alter or delete the date on any check accepted by the licensee. No licensee may accept an undated check or a check dated on a date other than the date on which the licensee accepts the check. (k) No licensee shall engage in unfair or deceptive acts, practices or advertising in the conduct of the licensed business. (l) Consistent with the nature of deferred presentment transactions, no licensee shall require a customer to provide security for the transaction or require the customer to provide a guaranty from another person. (m) Each licensee must pay the full amount of any check cashed in cash or by check issued by the licensee, less only the fees permitted under this chapter. Payment by a licensee by means of a check shall not cause the licensee to be subject to chapter 7 of this title. (n) Each licensee shall display its license in a conspicuous location in its place of business and shall post a notice in a conspicuous location in its place of business containing a description of the charges imposed by the licensee. (o) No licensee or any person related to the licensee by common ownership or control may have outstanding more than two (2) checks from any one (1) customer at any one (1) time, with the aggregate face value of all outstanding checks from any one (1) customer not to exceed five hundred dollars ($500). (p) Each licensee shall inquire of any person seeking deferred presentment services regarding the person's outstanding checks from other licensees. If the customer represents in writing that the customer has no more than two (2) checks outstanding to any licensee or licensees and that the aggregate face value of all outstanding checks issued by the customer for deferred presentment does not equal or exceed five hundred dollars ($500), a licensee may accept for deferred presentment a check in an amount that, when combined with the customer's other outstanding checks held for deferred presentment, does not exceed five hundred dollars ($500), so long as the check for deferred presentment complies with subsection (o). If the customer represents in writing that the customer has three (3) or more checks outstanding to any licensee or licensees, or if the aggregate face value of all outstanding checks issued by the customer for deferred presentment equals or exceeds five hundred dollars ($500), a licensee shall not accept another check for deferred presentment from that customer until the customer represents to the licensee in writing that the customer qualifies to issue a new check for deferred presentment in accordance with the preceding sentence. Each licensee may rely on a written representation of a customer regarding the existence of any outstanding checks for deferred presentment held by any licensee other than the licensee receiving the representation. (q) A licensee shall not renew or otherwise consolidate a deferred presentment transaction with the proceeds of another deferred presentment transaction made by the same licensee. A transaction entered into in violation of this subsection (q) is void and unenforceable in law or equity. (r) A licensee shall not use any device or agreement, including agreements with affiliated licensees, with the intent to obtain greater charges than otherwise would be authorized by this chapter. (s) (1) No deferred presentment services agreement, subject to this chapter shall: (A) Provide that the law of a jurisdiction other than Tennessee applies; (B) Provide that the customer consents to the jurisdiction of another state or foreign country; (C) Fix venue; or (D) Waive any provision of this chapter. (2) Any such provision contained in any deferred presentment services agreement subject to this chapter shall be void and not enforceable as a matter of public policy.

Legislative History

Acts 1997 , ch. 255, § 13; 1999, ch. 14, § 1; 2001, ch. 5, §1; 2011 , ch. 205, §§ 6-10.