Michigan Laws 451.415 – License; application; filing requirements; expiration and renewal of license; books and records; financial statement; licensee with board of directors or equivalent
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Terms Used In Michigan Laws 451.415
- Business of debt management: means providing or offering to provide debt management to 1 or more residents of this state. See Michigan Laws 451.412
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Debt management: means the planning and management of the financial affairs of a debtor and the receipt of money from the debtor for distribution to 1 or more of the debtor's creditors in payment or partial payment of the debtor's obligations. See Michigan Laws 451.412
- Department: means the department of insurance and financial services. See Michigan Laws 451.412
- Director: means the director of the department or his or her authorized representative. See Michigan Laws 451.412
- in writing: shall be construed to include printing, engraving, and lithographing; except that if the written signature of a person is required by law, the signature shall be the proper handwriting of the person or, if the person is unable to write, the person's proper mark, which may be, unless otherwise expressly prohibited by law, a clear and classifiable fingerprint of the person made with ink or another substance. See Michigan Laws 8.3q
- License: means a written certificate or exemption order issued by the director under this act. See Michigan Laws 451.412
- Licensee: means a person that is licensed, or is required to be licensed, under this act to perform debt management services and is located inside or outside the boundaries of this state. See Michigan Laws 451.412
- Office: means each location, described by street name, building number, city, and state, where a person engages in the business of debt management. See Michigan Laws 451.412
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Person: means an individual, corporation, partnership, association, joint stock company, trust if the interests of the beneficiaries are evidenced by a security, limited liability company, or other legal entity. See Michigan Laws 451.412
- Service of process: The service of writs or summonses to the appropriate party.
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
(1) An applicant for a license to engage in the business of debt management shall file an application with the director in writing and under oath that includes all of the following:
(a) The name and exact address of the applicant and the name and address of each of the following, as applicable:
(i) If the applicant is a corporation, its officers and directors.
(ii) If the applicant is an association, its officers and directors.
(iii) If the applicant is a partnership, its partners.
(iv) If the applicant is a limited liability company, its manager or managers.
(v) If the applicant is any other legal entity, its manager or other person designated to control the operation of that legal entity.
(b) A copy of a certificate of an assumed name, if applicable.
(c) One or more of the following, as applicable:
(i) If the applicant is a corporation, a copy of the articles of incorporation.
(ii) If the applicant is an association, a copy of the organizational documents of the association.
(iii) If the applicant is a partnership, a copy of the partnership agreement.
(iv) If the applicant is a limited liability company, a copy of the articles of organization.
(2) At the time an applicant files an application under this section, the applicant shall do all of the following:
(a) Pay to the department a license fee of $50.00 for each office.
(b) Pay to the department an investigation fee of $50.00.
(c) Furnish a surety bond, approved by the director, for the benefit of the people of the state of Michigan. The amount of the surety bond must equal or exceed the total amount of Michigan clients’ funds in the applicant’s or licensee‘s trust account at the time of application for license or renewal, as determined by the department, except that the amount of the surety bond shall not be less than $25,000.00 or greater than $100,000.00. The surety bond shall be conditioned on the faithful accounting of all money collected on accounts entrusted to a licensee engaged in the business of debt management or the licensee’s employees and agents. In lieu of a surety bond, the department may by rule provide for an appropriate deposit of cash or securities, a letter of credit, or the assignment of coverage of other bonds if the department is satisfied that comparable or more extensive coverage results.
(d) File an appointment of the director as the agent of the applicant for service of process in this state.
(3) Service of process on the director is considered service on an applicant or licensee, including an applicant that complies with or fails to comply with subsection (2)(d).
(4) Unless surrendered, revoked, or suspended, a license issued under this act expires on December 31 of the year for which it is issued. A licensee may renew a license before the expiration date as provided under this act.
(5) A licensee shall create, maintain, and preserve accurate and complete books and records relating to the licensee’s business. The books and records shall be maintained according to generally accepted accounting principles. A licensee or an applicant shall notify the department in writing of the address where the books and records are kept. If a licensee changes the location of the books and records, the licensee shall notify the department in writing within 10 business days after the change. The director may prescribe by rule or order the form and contents of books and records relating to a licensee’s business.
(6) An applicant shall file a financial statement with an application for a debt management license. The director may require that the financial statement be audited or reviewed by an independent certified public accountant.
(7) If a licensee has a board of directors or the equivalent, the director shall not require that the licensee provide information concerning a member of the board of directors or equivalent, or require that the member satisfy the examination provisions of this act, if that member does not receive a salary, stock dividend, or other financial benefit from that corporation other than reimbursement of the actual expenses incurred in carrying out the duties of a director of that corporation.