| (a) An application for issuance of a new debt management
services provider registration must be submitted as prescribed by
the OCCC at the date of filing and in accordance with the OCCC's instructions.
Applications may be submitted electronically.
(b) The application must include the following required
forms and filings. All questions must be answered.
(1) Application for registration.
(A) Required names and addresses. An applicant for
a debt management services provider registration must provide the
following:
(i) the applicant's name;
(ii) all other names under which the applicant conducts
business;
(iii) a physical street address for the applicant's
principal business address and that location's telephone number;
(iv) the address of each location in this state at
which the applicant will provide debt management services, or if the
applicant will have no such location, a statement to that effect;
(v) all other business addresses of the applicant in
this state;
(vi) the e-mail address of the applicant's responsible
person listed in subparagraph (B) of this paragraph; and
(vii) the applicant's primary Internet website address.
(B) Responsible person. The person responsible for
the day-to-day operation of the applicant's proposed business location
must be named.
(C) Authentication. An officer must authenticate the
application.
(2) Application questionnaire. All applicable questions
must be answered.
(3) Owners and principal parties.
(A) Detailed ownership and for-profit affiliate disclosure
of nonprofit or tax exempt organizations. If the applicant is a nonprofit
or tax exempt organization, a detailed description of the ownership
interest of each officer, director, agent, or employee of the applicant
must be provided. Any member of the immediate family of an officer,
director, agent, or employee of the applicant, in a for-profit affiliate
or subsidiary of the applicant, or in any other for-profit business
entity that provides services to the applicant or to a consumer in
relation to the applicant's debt management services business must
also be provided.
(B) Ownership disclosure. The section inquiring about
owners requires an answer based upon the applicant's entity type.
(i) All entity types. All applicants must disclose
the name and home address of each officer and director of the applicant
and each person that holds at least a 10% ownership interest in the
applicant.
(ii) Corporations. All shareholders holding 10% or
more voting stock must be named. If a parent corporation is the sole
or part owner of the proposed business, a narrative or diagram must
be provided that describes each level of ownership and management.
This narrative or diagram must include the names of all officers,
directors, and stockholders owning 10% or more stock at each level.
(iii) Limited liability companies. Each "manager,"
"officer," and "member" owning 10% or more of the company, as those
terms are defined in Texas Business Organizations Code, §1.002,
and each agent owning 10% or more of the company must be listed. If
a member is a legal entity and not a natural person, a narrative or
diagram must be included that describes each level of ownership of
10% or greater.
(iv) Proprietorships. The applicant must disclose the
name of any individual holding an ownership interest in the business
and the name of any individual responsible for operating the business.
If requested, the applicant must also disclose the names of the spouses
of these individuals.
(v) General partnerships. Each partner must be listed
and the percentage of ownership stated. If a general partner is wholly
or partially owned by a legal entity and not a natural person, a narrative
or diagram must be included that lists the names and titles of all
meeting the definition of "managerial official," as contained in Texas
Business Organizations Code, §1.002, and a description of the
ownership of each legal entity must be provided. General partnerships
that register as limited liability partnerships should provide the
same information as that required for general partnerships.
(vi) Limited partnerships. Each partner, general and
limited, fulfilling the requirements of subclauses (I) - (III) of
this clause must be listed and the percentage of ownership stated.
(I) General partners. The applicant should provide
the complete ownership, regardless of percentage owned, for all general
partners. If a general partner is wholly or partially owned by a legal
entity and not a natural person, a narrative or diagram must be included
that lists the names and titles of all meeting the definition of "managerial
official," as contained in Texas Business Organizations Code, §1.002,
and a description of the ownership of each legal entity must be provided.
(II) Limited partners. The applicant should provide
a complete list of all limited partners owning 10% or more of the
partnership.
(III) Limited partnerships that register as limited
liability partnerships. The applicant should provide the same information
as that required for limited partnerships.
(vii) Trusts or estates. Each trustee or executor,
as appropriate, must be listed.
(4) Registered agent. The registered agent must be
provided by each applicant. The registered agent is the person or
entity to whom any legal notice may be delivered. The agent must be
a Texas resident and list an address for legal service. If the registered
agent is a natural person, the address must be a different address
than the business location address. If the applicant is a corporation
or a limited liability company, the registered agent should be the
one on file with the Office of the Texas Secretary of State. If the
registered agent is not the same as the agent filed with the Office
of the Texas Secretary of State, then the applicant must submit a
certification from the secretary of the company identifying the registered
agent.
(5) Surety bond or insurance. An applicant must file
with the OCCC either:
(A) a Surety Bond in the prescribed form:
(i) At initial application:
(I) A provider that receives and holds money paid by
or on behalf of a consumer for disbursement to the consumer's creditors
must provide a bond in the amount of:
(-a-) $50,000, if the average daily balance of the
provider's trust account serving Texas consumers over the six-month
period preceding the issuance of the bond is less than $50,000 or
if the provider does not have any trust account history for Texas
consumers;
(-b-) $100,000, if the average daily balance of the
provider's trust account serving Texas consumers over the six-month
period preceding the issuance of the bond is $50,000 or more; or
(II) A provider that does not receive and hold money
paid by or on behalf of a consumer for disbursement to the consumer's
creditors must provide a bond in the amount of $50,000.
(ii) At annual renewal:
(I) A provider that receives and holds money paid by
or on behalf of a consumer for disbursement to the consumer's creditors
must provide a bond:
(-a-) in an amount that is equivalent to or exceeds
the average daily balance, but is not less than $25,000, if the average
daily balance of the provider's trust account serving Texas consumers
over the six-month period preceding the issuance of the bond is less
than $100,000;
(-b-) in the amount of $100,000, if the average daily
balance of the provider's trust account serving Texas consumers over
the six-month period preceding the issuance of the bond is $100,000
or more; or
(II) A provider that does not receive and hold money
paid by or on behalf of a consumer for disbursement to the consumer's
creditors must provide a bond in the amount of $50,000; or
(B) evidence of insurance meeting the requirements
of Texas Finance Code, §394.206 and clauses (i) - (iii) of this
subparagraph, as follows:
(i) a fidelity insurance policy, in the aggregate amount
of $100,000, that provides coverage for:
(I) employee dishonesty;
(II) depositor's forgery;
(III) computer fraud; and
(ii) a professional liability insurance policy in the
aggregate amount of $100,000.
(iii) The fidelity insurance policy and the professional
liability insurance policy must cover losses sustained by a Texas
resident that are attributable to a debt management service or a debt
management services agreement. Both the fidelity insurance policy
and the professional liability insurance policy must contain a loss
payee clause or rider stating that any loss or claim arising out of
an action which occurred within the scope of Texas Finance Code, Chapter
394 may be payable in favor of the State of Texas.
Cont'd... |
