This Part applies to a person engaged in this State in entering into consumer credit transactions and to a person having an office or place of business in this State who takes assignments of and undertakes direct collection of payments from or enforcement of rights against debtors arising from these transactions. In addition, this Part applies to a person, wherever located, who takes assignments of and undertakes direct collection of payments from or enforcement of rights against debtors arising from a consumer credit sale of a motor vehicle subject to this Title. This Part also applies to a person, other than a supervised financial organization, wherever located, who takes assignments of and undertakes direct collection of payments from or enforcement of rights against debtors arising from a consumer credit transaction subject to Article IX.

Sec. 5. 9-A MRSA §10-102, sub-§1, ¶B, as amended by PL 1997, c. 66, §5, is further amended to read:

B. "Credit services organization" does not include:

(1) A supervised financial organization as defined in section 1-301, subsection 38-A;

(2) A supervised lender as defined in section 1-301, subsection 39, except that, with respect to any transaction in which a supervised lender is acting solely as a credit services organization, section 10- 302 applies;

(3) A person licensed by the Real Estate Commission to the extent that the person is engaged in activities regulated by that commission;

(4) A person currently admitted to the practice of law in this State;

(5) Any nonprofit organization exempt from taxation under the United States Internal Revenue Code, Section 501(c)(3) to the extent that the organization's activities are consistent with those set forth in its application for tax exemption to the Internal Revenue Service; or

(6) A consumer reporting agency, as defined in the Fair Credit Reporting Act, Title 10, chapter 210.

Sec. 6. 10 MRSA §1313-A, sub-§2, ¶¶A and B, as enacted by PL 1997, c. 155, Pt. B, §6 and affected by §13, are amended to read:

A. A consumer reporting agency may furnish a consumer report for employment purposes only if:

(1) The person who obtains the report from the agency certifies to the agency that:

(a) The person has complied with paragraph B with respect to the consumer report, and the person will comply with section 1320 with respect to the consumer report if section 1320 becomes applicable; and

(b) Information from the consumer report will not be used in violation of any applicable federal or state equal employment opportunity law or regulation; and

(2) The consumer reporting agency provides with the report, or has previously provided, a summary of the consumer's rights under this Act as prescribed by the Federal Trade Commission under 15 United States Code, Section 1681g(c)(3).

B. A Except as provided in paragraph B-1, a person may not procure a consumer report or cause a consumer report to be procured for employment purposes with respect to any consumer, unless:

(1) A clear and conspicuous disclosure has been made in writing to the consumer before the report is procured or caused to be procured, in a document that consists solely of the disclosure, that a consumer report may be obtained for employment purposes; and

(2) The consumer has authorized in writing the procurement of the report by that person.

Sec. 7. 10 MRSA §1313-A, sub-§2, ¶¶B-1 and B-2 are enacted to read:

B-1.__A person who procures a consumer report on a consumer described in paragraph B-2, subparagraph (1) for employment purposes shall provide to the consumer, by oral, written or electronic means, notice that a consumer report may be obtained for employment purposes and a summary of the

consumer's rights under section 1320, subsection 1-B, paragraph C:

(1)__When the consumer applies for employment by mail; and

(2)__When the consumer has consented, orally, in writing or electronically, to the procurement of the report by that person.

B-2.__Paragraph B-1 applies to a person procuring a consumer report on a consumer in connection with the consumer's application for employment only if:

(1)__The consumer is applying for a position over which the federal Secretary of Transportation has the power to establish qualifications and maximum hours of service pursuant to the provisions of 49 United States Code, Section 31502 or a position subject to safety regulation by a state transportation agency; and

(2)__As of the time at which the person procures the consumer report or causes the report to be procured, the only interaction between the consumer and the person in connection with that employment application has been by mail, telephone, computer or other similar means.

Sec. 8. 10 MRSA §1313-A, sub-§2, ¶C, as enacted by PL 1997, c. 155, Pt. B, §6 and affected by §13, is amended to read:

C. In Except as provided in paragraph C-1, in using a consumer report for employment purposes, before taking any adverse action based in whole or in part on the report, the person intending to take the adverse action shall provide to the consumer to whom the report relates:

(1) A copy of the report; and

(2) A description in writing of the rights of the consumer under this Act as prescribed by the Federal Trade Commission under 15 United States Code, Section 1681g(c)(3).

Sec. 9. 10 MRSA §1313-A, sub-§2, ¶¶C-1 and C-2 are enacted to read:

C-1.__If a consumer described in paragraph C-2 applies for employment by mail, telephone, computer or other similar means and if a person who has procured a consumer report on

the consumer for employment purposes takes adverse action on the employment application based in whole or in part on the report, then the person shall provide to the consumer to whom the report relates, in lieu of the notices required under paragraph B, subparagraph (1) and under section 1320, within 3 business days of taking such action, an oral, written or electronic notification:

(1)__That adverse action has been taken based in whole or in part on a consumer report received from a consumer reporting agency;

(2)__Of the name, address and telephone number of the consumer reporting agency that furnished the consumer report, including a toll-free telephone number established by the agency if the agency compiles and maintains files on consumers on a nationwide basis;

(3)__That the consumer reporting agency did not make the decision to take the adverse action and is unable to provide to the consumer the specific reasons why the adverse action was taken; and

(4)__That the consumer may, upon providing proper identification, request a free copy of a consumer report and may dispute with the consumer reporting agency the accuracy or completeness of any information in a report.

If, under subparagraph (4), the consumer requests a copy of a consumer report from the person who procured the report, then, within 3 business days of receiving the consumer's request together with proper identification, the person shall send or provide to the consumer a copy of a report and a summary of the consumer's rights as prescribed by the Federal Trade Commission under 15 United States Code, Section 1681g(c)(3).

C-2.__Paragraph C-1 applies to a person procuring a consumer report on a consumer in connection with the consumer's application for employment only if:

(1)__The consumer is applying for a position over which the federal Secretary of Transportation has the power to establish qualifications and maximum hours of service pursuant to the provisions of 49 United States Code, Section 31502 or a position subject to safety regulation by a state transportation agency; and

(2)__As of the time at which the person procures the consumer report or causes the report to be procured, the only interaction between the consumer and the person in connection with that employment application has been by mail, telephone, computer or other similar means.

Sec. 10. 10 MRSA §1313-A, sub-§§4 to 7 are enacted to read:

4.__Information regarding inquiries.__Except as provided in section 1315, a consumer reporting agency may not furnish to any person a record of inquiries in connection with a credit or insurance transaction that are not initiated by a consumer.

5.__Election of consumer to be excluded from lists.__A consumer may elect to have the consumer's name and address excluded from any list provided by a consumer reporting agency under subsection 3 in connection with a credit or insurance transaction that is not initiated by the consumer by notifying the agency in accordance with paragraph A that the consumer does not consent to any use of a consumer report relating to the consumer in connection with any credit or insurance transaction that is not initiated by the consumer.

A.__A consumer shall notify a consumer reporting agency:

(1)__Through the notification system maintained by the agency under paragraph D; or

(2)__By submitting to the agency a signed notice of election form issued by the agency for purposes of this subparagraph.

B.__Upon receipt of notification of the election by a consumer through the notification system maintained by a consumer reporting agency under paragraph D, the agency shall:

(1)__Inform the consumer that the election is effective only for the 2-year period following the election if the consumer does not submit to the agency a signed notice of election form issued by the agency for purposes of paragraph A, subparagraph (2); and

(2)__Provide to the consumer a notice of election form, if requested by the consumer, not later than 5 business days after receipt of the notification of the election through the notification system established under paragraph D.

C.__An election by a consumer under this subsection:

(1)__Is effective with respect to a consumer reporting agency beginning 5 business days after the date on which the consumer notifies the agency in accordance with paragraph A;

(2)__Is effective with respect to a consumer reporting agency:

(a)__Subject to subparagraph (3), during the 2- year period beginning 5 business days after the date on which the consumer notifies the agency of the election, in the case of an election for which a consumer notifies the agency only in accordance with paragraph A, subparagraph (1); or

(b)__Until the consumer notifies the agency under subparagraph (3), in the case of an election for which a consumer notifies the agency in accordance with paragraph A, subparagraph (2);

(3)__Is not effective after the date on which the consumer notifies the agency, through the notification system established by the agency under paragraph D, that the election is no longer effective; and

(4)__Is effective with respect to each affiliate of the agency.

D.__A consumer reporting agency shall establish a notification system.

(1)__Each consumer reporting agency that, under subsection 3, furnishes a consumer report in connection with a credit or insurance transaction that is not initiated by a consumer shall:

(a)__Establish and maintain a notification system, including a toll-free telephone number, that permits any consumer whose consumer report is maintained by the agency to notify the agency, with appropriate identification, of the consumer's election to have the consumer's name and address excluded from a list of names and addresses provided by the agency for such a transaction; and

(b)__Publish not less than annually, in a publication of general circulation in the area served by the agency:

(i)__A notification that information in consumer files maintained by the agency may be used in connection with such transactions; and

(ii)__The address and toll-free telephone number for consumers to use to notify the agency of the consumer's election under this subsection.

(2)__An affiliate of a consumer reporting agency that establishes and maintains a notification system, including a toll-free telephone number, and publishes information under subparagraph (b) on the agency's own behalf and on behalf of any of its affiliates in accordance with this paragraph is considered to be in compliance with this paragraph.

E.__Each consumer reporting agency that compiles and maintains files on consumers on a nationwide basis shall establish and maintain a notification system for purposes of paragraph D jointly with other such consumer reporting agencies.

6.__Certain use or obtaining of information prohibited.__A person may not use or obtain a consumer report for any purpose unless:

A.__The consumer report is to be obtained for a purpose for which the consumer report is authorized to be furnished under this section; and

B.__The purpose is certified in accordance with section 1321 by a prospective user of the report through a general or specific certification.

7.__Furnishing reports containing medical information.__A consumer reporting agency may not furnish for employment purposes or in connection with a credit or insurance transaction or a direct marketing transaction a consumer report that contains medical information about a consumer unless the consumer consents in writing to the furnishing of the report.

Sec. 11. 10 MRSA §1313-B is enacted to read:

§1313-B.__Requirements relating to information contained in

consumer reports

1.__Information excluded from consumer reports; prohibited items.__Except as authorized under subsection 2, a consumer reporting agency may not make any consumer reports containing any of the following items of information:

A.__Cases under federal law, Title 11 or under the federal Bankruptcy Act that, from the date of entry of the order for relief or the date of adjudication, as the case may be, antedate the report by more than 10 years;

B.__Civil suits, civil judgments and records of arrest that, from date of entry, antedate the report by more than 7 years or until the governing statute of limitations has expired, whichever is the longer period;

C.__Paid tax liens that, from date of payment, antedate the report by more than 7 years;

D.__Accounts placed for collection or charged to profit and loss that antedate the report by more than 7 years; or

E.__Any other adverse item of information, other than records of conviction of crimes, that antedates the report by more than 7 years.

2.__Exempted cases.__The provisions of subsection 1 are not applicable in the case of any consumer credit report to be used in connection with:

A.__A credit transaction involving, or that may reasonably be expected to involve, a principal amount of $150,000 or more;

B.__The underwriting of life insurance involving, or that may reasonably be expected to involve, a face amount of $150,000 or more; or

C.__The employment of any individual at an annual salary that equals, or that may reasonably be expected to equal, $75,000 or more.

3.__Running of reporting period.__The reporting period for consumer reports runs as follows.

A.__The 7-year period referred to in subsection 1, paragraphs D and E begins with respect to any delinquent account that is placed for collection, internally or by referral to a 3rd party, whichever is earlier, charged to profit and loss or subjected to any similar action upon the expiration of a 180-day period beginning on the date of the

commencement of the delinquency that immediately preceded the collection activity, charge to profit and loss or similar action.

B.__Paragraph A applies only to items of information added to the file of a consumer on or after December 30, 1997.

4.__Information required to be disclosed.__Any consumer reporting agency that furnishes a consumer report that contains information regarding any case involving a consumer that arises under federal law or Title 11 shall include in the report an identification of the chapter of Title 11 under which the case arises if provided by the source of the information.__If any case arising or filed under Title 11 is withdrawn by the consumer before a final judgment, the consumer reporting agency shall include in the report that the case or filing was withdrawn upon receipt of documentation certifying the withdrawal.

5.__Indication of closure of account by consumer.__If a consumer reporting agency is notified pursuant to section 1320-A, subsection 4 that a credit account of a consumer was voluntarily closed by the consumer, the agency shall indicate that fact in any consumer report that includes information related to the account.

6.__Indication of dispute by consumer.__If a consumer reporting agency is notified pursuant to section 1320-A, subsection 3 that information regarding a consumer that was furnished to the agency is disputed by the consumer, the agency shall indicate that fact in each consumer report that includes the disputed information.

Sec. 12. 32 MRSA §6104, sub-§1, ¶D, as enacted by PL 1997, c. 155, Pt. A, §2, is amended to read:

D. Banks, bank holding companies, credit unions, building and loan associations, savings and loan associations, savings banks or mutual banks organized under the laws of any state or the United States, provided that Supervised financial organizations as defined in Title 9-A, section 1- 301, subsection 38-A as long as they do not engage in the business of issuing or selling payment instruments through authorized delegates who are not banks, bank holding companies, credit unions, building and loan associations, savings and loan associations, savings banks or mutual banks supervised financial organizations as defined in Title 9-A, section 1-301, subsection 38-A; and

SUMMARY

This bill amends various laws administered by the Office of Consumer Credit Regulation. This bill clarifies that transactions entered into following electronic mail solicitations by lenders and creditors are subject to the Maine Consumer Credit Code. The bill excludes limited-purpose financial institutions from certain provisions of the Maine Consumer Credit Code. The bill grants to the Director of the Office of Consumer Credit Regulation the power to issue a temporary order suspending the license of a supervised lender under circumstances in which delaying such an order would result in harm to consumers.