S.B. No. 884
relating to the regulation of consumer debt management services.
       SECTION 1.  Subsection (c), Section 394.204, Finance Code,
is amended to read as follows:
       (c)  An application for an initial registration must be in a
form prescribed by the commissioner and accompanied by:
             (1)  the appropriate fees set by the finance commission
in an amount necessary to recover the costs of administering this
             (2)  the surety bond or insurance required by Section
             (3)  the applicant's name, the applicant's principal
business address and telephone number, all other business addresses
of the applicant in this state, and the applicant's electronic mail
address and Internet website address;
             (4)  all names under which the applicant conducts
             (5)  the address of each location in this state at which
the applicant will provide debt management services, or if the
applicant will have no such location, a statement to that effect;
             (6)  the name and home address of each officer and
director of the applicant and each person that holds at least a 10
percent ownership interest in the applicant;
             (7)  if the applicant is a nonprofit or tax exempt
organization, a detailed description of the ownership interest of
each officer, director, agent, or employee of the applicant, and
any member of the immediate family of an officer, director, agent,
or employee of the applicant, in a for-profit affiliate or
subsidiary of the applicant or in any other for-profit business
entity that provides services to the applicant or to a consumer in
relation to the applicant's debt management business; and
             (8) [(4)]  any other information that the commissioner
       SECTION 2.  Subsection (b), Section 394.205, Finance Code,
is amended to read as follows:
       (b)  Each provider shall file a report with the commissioner
at each renewal of the provider's registration. The report must at
a minimum disclose in detail and under appropriate headings:
             (1)  the assets and liabilities of the provider at the
beginning and end of the period, if the provider is a nonprofit or
tax exempt organization;
             (2)  the total number of debt management plans the
provider has initiated on behalf of consumers in this state during
that year; and
             (3)  records of total and average fees charged to
consumers, including all voluntary contributions received from
       SECTION 3.  Subsections (a) and (d), Section 394.208,
Finance Code, are amended to read as follows:
       (a)  A provider may not enroll a consumer in a debt
management plan unless,[:
             [(1)  the provider is a nonprofit organization exempt
from taxation under Section 501(c)(3), Internal Revenue Code of
1986; and
             [(2)]  through the services of a counselor certified by
an independent accreditation organization, the provider has:
             (1) [(A)]  provided the consumer individualized
counseling and educational information that at a minimum addresses
the topics of managing household finances, managing credit and
debt, and budgeting;
             (2) [(B)]  prepared an individualized financial
analysis and an initial debt management plan for the consumer's
debts with specific recommendations regarding actions the consumer
should take;
             (3) [(C)]  determined that the consumer has a
reasonable ability to make payments under the proposed debt
management plan based on the information provided by the consumer;
             (4) [(D)]  a reasonable expectation, provided that the
consumer has provided accurate information to the provider, that
each creditor of the consumer listed as a participating creditor in
the plan will accept payment of the consumer's debts as provided in
the initial plan;
             (5) [(E)]  prepared, for all creditors identified by
the consumer or identified through additional investigation by the
provider, a list, which must be provided to the consumer in a form
the consumer may keep, of the creditors that the provider
reasonably expects to participate in the plan; and
             (6) [(F)]  provided a written document to the consumer
in a form the consumer may keep that clearly and conspicuously
contains the following statements:
                   (A) [(i)]  that debt management services are not
suitable for all consumers and that consumers may request
information about other ways, including bankruptcy, to deal with
                   (B) [(ii)]  that if the provider is a nonprofit or
tax-exempt organization the provider cannot require donations or
contributions; and
                   (C)  if applicable, [(iii)] that some of the
provider's funding comes from contributions from creditors who
participate in debt management plans, except that a provider may
substitute for "some" the actual percentage of creditor
contributions it received during the most recent reporting period.
       (d)  A provider may provide the information required by
Subsections (a)(2), (5), and (6) [(a)(2)(B), (E), and (F)] through
its Internet website if the provider:
             (1)  has complied with the federal Electronic
Signatures in Global and National Commerce Act (15 U.S.C. Section
7001 et seq.);
             (2)  informs the consumer that, on electronic,
telephonic, or written request the provider will make available to
the consumer a paper copy or copies; and
             (3)  discloses on its Internet website:
                   (A)  the provider's name and each name under which
it does business;
                   (B)  the provider's principal business address
and telephone number; and
                   (C)  the names of the provider's principal
       SECTION 4.  Section 394.210, Finance Code, is amended by
adding Subsection (f) to read as follows:
       (f)  The finance commission may establish maximum fair and
reasonable fees under this section.
       SECTION 5.  This Act takes effect September 1, 2007.
President of the Senate             Speaker of the House
       I hereby certify that S.B. No. 884 passed the Senate on
April 12, 2007, by the following vote:  Yeas 31, Nays 0.
   Secretary of the Senate
       I hereby certify that S.B. No. 884 passed the House on
April 27, 2007, by the following vote:  Yeas 133, Nays 0, two
present not voting.
   Chief Clerk of the House