Prohibited activities
A credit services organization and its workers are not allowed to do certain things. They cannot take money from a customer before finishing all the work they promised, unless they have a special bond or a protected bank account set up first. They cannot charge someone just for pointing them to a lender if that lender offers the same credit deals as anyone else could get. They cannot lie or mislead people about what they can do, like promising to erase bad credit unless it is actually wrong or outdated information. They cannot act in a dishonest or tricky way when selling their services. They cannot tell a customer to lie about their credit history to a lender or credit reporting agency. They cannot advertise their services without first registering with the state director of finance.
407.638. Prohibited activities. — A , a salesperson, or of a credit services organization, or an who sells or attempts to sell the services of a credit services organization may not:
(1) Charge a buyer or receive from a buyer money or other before completing performance of all services the credit services organization has agreed to perform for the buyer, unless the credit services organization has obtained in accordance with section 407.639 a in the amount required by 4 of section 407.639, issued by a to do business in this state, or has established and maintained a at a federally bank or located in this state in which the amount required by subsection 5 of section 407.639 is as required by section 407.639;
(2) Charge a buyer or receive from a buyer money or other valuable consideration solely for of the buyer to a who will or may extend to the buyer if the credit that is or will be extended to the buyer is substantially the same as that available to the general public;
(3) Make or use a false or misleading representation in the offer or sale of the services of a credit services organization, including:
(a) Guaranteeing to "erase bad credit" or words to that effect unless the representation clearly discloses that this can be done only if the credit history is inaccurate or ; and
(b) Guaranteeing an regardless of the person's previous credit problem or credit history unless the representation clearly discloses the eligibility requirements for obtaining an extension of credit;
(4) Engage, directly or indirectly, in a or deceptive act, practice or course of business in connection with the offer or sale of the services of a credit services organization;
(5) Make, or advise a buyer to make, a statement with respect to a buyer's , , or that is false or misleading or that should be known by the exercise of reasonable care to be false or misleading, to a or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit;
(6) Advertise or cause to be advertised, in any manner whatsoever, the services of a credit services organization without a with the , unless otherwise provided by this chapter.
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Source & history notes
(L. 1991 S.B. 112 § 3)
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