2015 Delaware Code
Title 6 - Commerce and Trade
CHAPTER 24A. DEBT-MANAGEMENT SERVICES
§ 2431A Liability for the conduct of other persons.

If a provider delegates any of its duties or obligations under an agreement or this chapter to another person, including an independent contractor, the provider is liable for conduct of the person which, if done by the provider, would violate the agreement or this chapter.

75 Del. Laws, c. 430, § 1.;

§ 2432A Powers of Attorney General.

(a) The Attorney General may act on the Attorney General's own initiative or in response to complaints, and may receive complaints, take action to obtain voluntary compliance with this chapter, and seek or provide remedies as provided in this chapter.

(b) Every provider licensed under this chapter, or other person to whom a provider has delegated its obligations under an agreement or this chapter, shall be subject to the supervision and examination of the Attorney General and shall be examined by the Attorney General or the Attorney General's authorized representative annually or at such intervals as the Attorney General deems necessary.

(1) On the occasion of every examination, the Attorney General or the Attorney General's authorized representative shall be given access to every part of the office or place of business visited and to the assets, securities, books, records and papers of the business;

(2) The examination made by the Attorney General or the Attorney General's authorized representative shall be a thorough examination into the affairs of the business visited, the resources and liabilities, the investment of the funds, the mode of conducting the business and the compliance or noncompliance with this Code and any other statutes of the State; and in connection with such examination, the Attorney General or the Attorney General's authorized representative may examine, under oath or affirmation, any and all persons connected with or associated with the licensed provider.

(3) If, in the Attorney General's opinion, it is necessary for a thorough examination of a licensed provider, the Attorney General may retain 1 or more accountants, attorneys, appraisers or other third parties to assist the Attorney General in such examination. Within 10 days after receipt of a statement from the Attorney General, such licensed provider shall pay or reimburse the fees, costs and expenses of any third parties retained by the Attorney General under this subsection.

(c) The Attorney General may seek a court order authorizing seizure from a bank at which the person maintains a trust account required by § 2422A of this title, any or all money, books, records, accounts, and other property of the provider that is in the control of the bank and relates to individuals who reside in this State.

(d) The Attorney General may enter into cooperative arrangements with any other federal or state agency having authority over providers and may exchange with any of those agencies information about a provider, including information obtained during an examination of the provider.

(e) The Attorney General shall assess fees to be paid by providers for the expense of administering this chapter, including examination, application and renewal fees, in accordance with this chapter. All fees shall be paid to the State Consumer Protection Fund created under § 2527 of this title.

(f) The Attorney General may adopt dollar amounts instead of those specified in §§ 2402A, 2409A, and 2423A of this title to reflect inflation, as measured by the United States Bureau of Labor Statistics Consumer Price Index for All Urban Consumers or, if that index is not available, another index adopted by rule by the Attorney General. The Attorney General shall adopt a base year and adjust the dollar amounts, effective on July 1 of each year, if the change in the index from the base year, as of December 31 of the preceding year, is at least 10 percent. The dollar amount must be rounded to the nearest $100, except that the amounts in § 2423A of this title must be rounded to the nearest dollar.

(g) The Attorney General shall notify licensed providers of any change in dollar amounts made pursuant to subsection (f) of this section and make that information available to the public.

(h) The Attorney General may adopt such regulations, not inconsistent herewith, as the Attorney General may deem necessary or appropriate in the administration, interpretation and enforcement of this chapter. Subchapter II of the Delaware Administrative Procedures Act, Chapter 101 of Title 29 shall apply to the procedures for adopting such regulations.

75 Del. Laws, c. 430, § 1.;

§ 2433A Administrative remedies.

(a) In addition to any other enforcement method specified in this Code, the Attorney General may enforce this chapter and the rules adopted under this chapter by taking one or more of the following actions:

(1) Ordering a provider or a director, employee, or other agent of a provider to cease and desist from any violations;

(2) Ordering a provider or a person that has caused a violation to correct the violation, including making restitution of money or property to a person aggrieved by a violation;

(3) Imposing on a provider or a person that has caused a violation a civil penalty not exceeding $50,000 for each violation;

(4) Prosecuting a civil action to:

(A) Enforce an order; or

(B) Obtain restitution or an injunction or other equitable relief, or both;

(5) Intervening in an action brought under § 2435A of this title.

(b) If a person violates or knowingly authorizes, directs, or aids in the violation of a final order issued under paragraph (a)(1) or (a)(2) of this section, the Attorney General may impose a civil penalty not exceeding $75,000 for each violation.

(c) In determining the amount of a civil penalty to impose under subsection (a) or (b) of this section, the Attorney General shall consider the seriousness of the violation, the good faith of the violator, any previous violations by the violator, the deleterious effect of the violation on the public, the net worth of the violator, and any other factor the Attorney General considers relevant to the determination of the civil penalty.

(d) Any civil penalty imposed under subsection (a) or (b) of this section shall be paid to the State Treasurer for deposit in the General Fund.

(e) Service of any notice or order issued pursuant to paragraph (a)(1), (a)(2), (a)(3) or subsection (b) of this section may be effected in any manner that is allowed for service of a complaint in the Superior Court of this State.

(f) The Attorney General may recover from the violator all reasonable costs of enforcing this chapter under subsections (a) and (b) of this section, including attorney's fees based on the hours reasonably expended and the hourly rates for attorneys of comparable experience in the community, and also including the compensation of all employees of the Attorney General's office based on the time they reasonably expended on the matter.

(g)(1) Except as provided in paragraph (g)(2) of this section, an order issued under paragraph (a)(1), (a)(2), (a)(3), or subsection (b) of this section shall not become effective less than 10 days after the order is served. After an order is served, but before its effective date, any interested party may petition the Attorney General for a hearing. At the conclusion of such hearing, the Attorney General may affirm the order as originally issued, or modify, amend or rescind the order.

(2) Whenever in the opinion of the Attorney General, the violation that is the subject of an order under paragraph (a)(1) or (a)(2) of this section represents an immediate danger or substantial harm to the interests of any person aggrieved by a violation or the public, or where such violation or its continuance is likely to cause insolvency or substantial dissipation of the assets of a provider, the Attorney General may issue an order which shall become effective immediately upon service, without prior notice or hearing. Upon application of any interested party, the Attorney General shall afford an opportunity for a hearing to consider rescission of that order or any action taken promptly thereafter.

(3) Upon receipt of a hearing request, the Attorney General shall conduct a proceeding pursuant to subchapter III of the Delaware Administrative Procedures Act, Chapter 101 of Title 29. Notwithstanding any other provision of this Code, any final order under this section will be a public record.

75 Del. Laws, c. 430, § 1.;

§ 2434A Suspension, revocation, or nonrenewal of license.

(a) In this section "insolvent'' means:

(1) Having generally ceased to pay debts in the ordinary course of business other than as a result of good-faith dispute;

(2) Being unable to pay debts as they become due; or

(3) Being insolvent within the meaning of the federal bankruptcy law, 11 U.S.C. § 101 et seq., as amended.

(b) The Attorney General may suspend, revoke, or deny renewal of a provider's license if:

(1) A fact or condition exists that, if it had existed when the licensed provider applied for its provider license, would have been a reason for denying the license;

(2) The provider has committed a material violation of this chapter or a rule or order of the Attorney General under this chapter;

(3) The provider is insolvent;

(4) The provider or an employee or affiliate of the provider has refused to permit the Attorney General to make an examination authorized by this chapter; or

(5) The provider has not responded within a reasonable time and in an appropriate manner to communications from the Attorney General.

(c) If a provider does not comply with § 2422A(f) of this title or if the Attorney General otherwise finds that the public health or safety or general welfare requires emergency action, the Attorney General may order a summary suspension of the provider's license, effective on the date specified in the order.

(d) If the Attorney General suspends, revokes, or denies the renewal of a provider license, the Attorney General may seek a court order authorizing seizure of any or all of the money in a trust account required by § 2422A of this title, as well as all books, records, accounts, and other property of the provider which are located in this State.

(e) If the Attorney General makes a preliminary determination to suspend or revoke a provider's license, the provider may file a request for a hearing with the Attorney General pursuant to subchapter IV of the Delaware Administrative Procedures Act, Chapter 101 of Title 29. The Attorney General's preliminary determination may become a final decision if such a request is not timely filed. Notwithstanding any other provisions of this Code, any final order under this section will be a public record.

75 Del. Laws, c. 430, § 1.;

§ 2435A Private enforcement.

(a) If an individual voids an agreement pursuant to § 2425A(b) of this title, the individual may recover in a civil action all money paid or deposited by or on behalf of the individual pursuant to the agreement, except amounts paid to creditors, in addition to the recovery under paragraphs (c)(3) and (c)(4) of this section.

(b) If an individual voids an agreement pursuant to § 2425A(a) of this title, the individual may recover in a civil action 3 times the total amount of the fees, charges, money, and payments made by the individual to the provider, in addition to the recovery under paragraph (c)(4) of this section.

(c) Subject to subsection (d) of this section, an individual with respect to whom a provider violates this chapter may recover in a civil action from the provider and any person that caused the violation:

(1) Compensatory damages for injury, including noneconomic injury, caused by the violation;

(2) Except as otherwise provided in subsection (d) of this section, with respect to a violation of § 2417A, § 2419A, § 2420A, § 2421A, § 2422A, § 2423A, § 2424A, § 2427A, or § 2428A(a), (b), or (d) of this title, the greater of the amount recoverable under paragraph (c)(1) of this section or $5,000;

(3) Punitive damages; and

(4) Reasonable attorney's fees and costs.

(d) In a class action, except for a violation of § 2428A(a)(5) of this title, the minimum damages provided in paragraph (c)(2) of this section do not apply.

(e) In addition to the remedy available under subsection (c) of this section, if a provider violates an individual's rights under § 2420A of this title, the individual may recover in a civil action all money paid or deposited by or on behalf of the individual pursuant to the agreement, except for amounts paid to creditors.

(f) A provider is not liable under this section for a violation of this chapter if the provider proves that the violation was not intentional and resulted from a good-faith error notwithstanding the maintenance of procedures reasonably adapted to avoid the error. An error of legal judgment with respect to a provider's obligations under this chapter is not a good-faith error. If in connection with a violation, the provider has received more money than authorized by an agreement or this chapter, the defense provided by this subsection is not available unless the provider refunds the excess within 2 business days of learning of the violation.

(g) The Attorney General shall assist an individual in enforcing a judgment against the surety bond or other security provided under § 2413A or § 2414A of this title.

75 Del. Laws, c. 430, § 1.;

§ 2436A Violation of unfair or deceptive practices statute.

If an act or practice of a provider violates both this chapter and Chapter 25 of this title, an individual may not recover under both for the same act or practice.

75 Del. Laws, c. 430, § 1.;

§ 2437A Statute of limitations.

(a) An action or proceeding brought pursuant to § 2433A(a), (b), or (c) of this title must be commenced within 4 years after the conduct that is the basis of the Attorney General's complaint.

(b) An action brought pursuant to § 2435A of this title must be commenced within 3 years after the latest of:

(1) The individual's last transmission of money to a provider;

(2) The individual's last transmission of money to a creditor at the direction of the provider;

(3) The provider's last disbursement to a creditor of the individual;

(4) The provider's last accounting to the individual pursuant to § 2427A(a) of this title;

(5) The date on which the individual discovered or reasonably should have discovered the facts giving rise to the individual's claim; or

(6) Termination of actions or proceedings by the Attorney General with respect to a violation of the chapter.

(c) The period prescribed in paragraph (b)(5) of this section is tolled during any period during which the provider or, if different, the defendant has materially and wilfully misrepresented information required by this chapter to be disclosed to the individual if the information so misrepresented is material to the establishment of the liability of the defendant under this chapter.

75 Del. Laws, c. 430, § 1.;

§ 2438A Uniformity of application and construction.

In applying and construing this uniform act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

75 Del. Laws, c. 430, § 1.;

§ 2439A Relation to Electronic Signatures in Global and National Commerce Act.

This chapter modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.) but does not modify, limit, or supersede § 101(c) of that act (15 U.S.C. § 7001(c)) or authorize electronic delivery of any of the notices described in § 103(b) of that act (15 U.S.C. § 7003(b)).

75 Del. Laws, c. 430, § 1.;