Montana Code 30-14-2103. Prohibitions — contract cancellation
30-14-2103. Prohibitions — contract cancellation. (1) A debt settlement provider may not do any of the following:
Terms Used In Montana Code 30-14-2103
- Contract: A legal written agreement that becomes binding when signed.
- Debt settlement provider: means any person or entity engaging in or holding itself out as engaging in the business of debt settlement for compensation that does not in the usual and regular course of business hold, receive, or disburse a debtor's funds in connection with debt settlement services. See Montana Code 30-14-2101
- Gift: A voluntary transfer or conveyance of property without consideration, or for less than full and adequate consideration based on fair market value.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
- Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
- Principal amount of the debt: means the total amount of debt of an individual at the time the individual is accepted into a debt settlement program. See Montana Code 30-14-2101
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
(a)provide debt settlement services without a written contract signed by the debtor;
(b)receive or charge fees, other than setup fees, in an aggregate amount that is in excess of 20% of the principal amount of the debt. No more than 5% of the principal amount of the debt may be charged as a setup fee.
(c)make loans or offer credit;
(d)take any confession of judgment or power of attorney to confess judgment against the debtor or appear as the debtor or on behalf of the debtor in any judicial proceedings;
(e)take as part of any agreement to provide debt settlement services a release of any obligation to be performed on the part of the debt settlement provider;
(f)advertise, display, distribute, broadcast, or televise services or permit services to be displayed, advertised, distributed, broadcasted, or televised, in any manner whatsoever, that contains any false, misleading, or deceptive statements or representations with regard to the services to be performed or the fees to be charged by the debt settlement provider;
(g)receive any cash, fee, gift, bonus, premium, reward, or other compensation from any person other than the debtor or a person on the debtor’s behalf for performing debt settlement services;
(h)disclose to anyone the name or any personal information of a debtor for whom the debt settlement provider has provided or is providing debt settlement service other than a debtor’s own creditors or the debt settlement provider’s agents, affiliates, or contractors;
(i)disclose the name of a debtor’s creditor to anyone other than the debtor, a company acting on behalf of the debtor or the debtor’s debt settlement provider, or another creditor of the debtor and then only to the extent necessary to secure the cooperation of a creditor in a debt settlement plan;
(j)enter into a contract with a debtor without first providing the disclosure required in 30-14-2102(3);
(k)collect fees until a written debt settlement services contract has been executed by the debtor containing a schedule of fees in the actual amount to be charged the debtor and stating when those fees will be charged;
(l)advertise services in any manner in this state without first filing a financial statement with the attorney general;
(m)misrepresent any material fact or make a false promise intended to convince a debtor to enter into a debt settlement plan; or
(n)violate the provisions of any applicable state or federal do-not-call registry or Title 30, chapter 14, part 5.
(2)If a debt settlement service contract is canceled by the debtor before the contract is completed, the debt settlement provider shall, on request of the debtor, refund 50% of any collected but unrefunded service fee on a pro rata basis for those accounts that have not received a settlement offer by the time of the cancellation. Fees associated with the setup of a debt settlement service contract are not required to be refunded.