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State Laws
Colorado Consumer Credit Code
PART 1 POWERS AND FUNCTIONS OF ADMINISTRATOR
PART 2 NOTIFICATION AND FEES
PART 3 COUNCIL OF ADVISORS ON CONSUMER CREDIT
PART 1 POWERS AND FUNCTIONS OF ADMINISTRATOR
This article shall be known and may be cited as "Uniform Consumer Credit Code - Administration".
(1) This part 1 applies to persons who in this state:
(a) Make or solicit consumer credit transactions; or
(b) Directly collect payments from or enforce rights against consumers arising from sales, leases, or loans specified in paragraph (a) of this subsection (1) wherever they are made.
"Administrator" means the assistant attorney general to be designated by the attorney general. Any district attorney may, with the consent of the administrator, exercise the powers and perform the duties of the administrator as provided in section 5-6-104 (1) (a) and (1) (b) and sections 5-6-105 to 5-6-116.
(1) In addition to other powers granted by this code, the administrator, within the limitations provided by law, may:
(a) Receive and act on complaints, take action designed to obtain voluntary compliance with this code, or commence proceedings on his or her own initiative;
(b) Counsel persons and groups on their rights and duties under this code;
(c) Establish programs for the education of consumers with respect to credit practices and problems;
(d) Make studies appropriate to effectuate the purposes and policies of this code and make the results available to the public;
(e) With approval of the council of advisors on consumer credit subcommittee, adopt, amend, and repeal substantive rules and regulations to carry out the specific provisions of this code, but not with respect to unconscionable agreements or fraudulent or unconscionable conduct, and adopt, amend, and repeal procedural rules to carry out the provisions of this code;
(f) Maintain offices within this state;
(g) Enforce the provisions of article 14.5 of title 12, C.R.S.;
(h) Employ administrative law judges from the office of administrative courts in the department of personnel to conduct hearings on any matter within the administrator's jurisdiction;
(i) License and regulate collection agencies pursuant to article 14 of title 12, C.R.S.; and
(j) Exchange information with another governmental agency or official that has regulatory authority comparable to that of the administrator, subject to an appropriate confidentiality agreement between the administrator and the other agency or official or as otherwise permitted by law. This paragraph (j) shall not be construed to allow the exchange of information with lenders or creditors.
(2) The administrator may adopt rules not inconsistent with the federal "Truth in Lending Act" and federal "Consumer Leasing Act" to assure a meaningful disclosure of credit terms so that a prospective consumer will be able to compare more readily the various credit terms available to him or her and to avoid the uninformed use of credit. Such rules shall supersede any provisions of this code that are inconsistent with the federal "Truth in Lending Act" and federal "Consumer Leasing Act", may contain classifications, differentiations, or other provisions, and may provide for adjustments and exceptions for any class of transactions subject to this code that, in the judgment of the administrator, are necessary or proper to effectuate the purposes of, or to prevent circumvention or evasion of, or to facilitate compliance with, the provisions of this code relating to disclosure of credit terms.
(3) To keep the administrator's rules in harmony with the federal "Truth in Lending Act" and the federal "Consumer Leasing Act" and the regulations prescribed from time to time pursuant to that act by the board of governors of the federal reserve system and with the rules of administrators in other jurisdictions that enact the "Uniform Consumer Credit Code", the administrator, so far as is consistent with the purposes, policies, and provisions of this code, shall:
(a) Before adopting, amending, and repealing rules and regulations, advise and consult with administrators in other jurisdictions that enact the "Uniform Consumer Credit Code"; and
(b) In adopting, amending, and repealing rules and regulations, take into consideration:
(I) The regulations so prescribed by the board of governors of the federal reserve system; and
(II) The rules of administrators in other jurisdictions that enact the "Uniform Consumer Credit Code".
(4) Except for a refund of an excess charge, no liability is imposed under this code for an act done or omitted in good faith in conformity with a rule, regulation, interpretation, or written response to a person pursuant to a written request on behalf of such identified person by the administrator, notwithstanding that after the act or omission the rule, regulation, interpretation, or written response may be amended or repealed or be determined by judicial or other authority to be invalid for any reason.
(1) With respect to supervised financial organizations, the powers of examination and investigation described in sections 5-2-305 and 5-6-106 and administrative enforcement described in section 5-6-108 shall be exercised by the official or agency to whose supervision the organization is subject. All other powers of the administrator under this code may be exercised by the administrator with respect to a supervised financial organization.
(2) If the administrator receives a complaint or other information concerning noncompliance with this code by a supervised financial organization, the administrator shall inform the official or agency having supervisory authority over the organization concerned. The administrator may request information about supervised financial organizations from the officials or agencies supervising them.
(3) The administrator and any official or agency of this state having supervisory authority over a supervised financial organization are authorized and directed to consult and assist one another in maintaining compliance with this code. They may jointly pursue investigations, prosecute suits, and take other official action, as they deem appropriate, if either of them otherwise is empowered to take the action. The administrator may recover from a supervised financial organization the administrator's reasonable costs incurred in such investigation, suit, or other official action as part of any relief granted the administrator by a court of competent jurisdiction.
(1) If the administrator has reasonable cause to believe that a person has engaged in an act that is subject to action by the administrator, the administrator may make an investigation to determine if the act has been committed, and, to the extent necessary for this purpose, may administer oaths or affirmations, and, upon his or her own motion or upon request of any party, may subpoena witnesses, compel their attendance, adduce evidence, and require the production of any matter that is relevant to the investigation, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of relevant facts, or any other matter reasonably calculated to lead to the discovery of admissible evidence. In any civil action brought by the administrator as a result of such an investigation, the administrator may recover the reasonable costs of making the investigation if the administrator prevails in the action.
(2) If the person's records are located outside this state, the person at his or her option shall either make them available to the administrator at a convenient location within this state or pay the reasonable and necessary expenses for the administrator or the administrator's representative to examine them at the place where they are maintained. The administrator may designate representatives, including comparable officials of the state in which the records are located, to inspect them on the administrator's behalf.
(3) Upon failure without lawful excuse to obey a subpoena or to give testimony, the administrator may apply to the district court for an order compelling compliance.
(4) The administrator shall not make public the name or identity of a person whose acts or conduct he or she investigates pursuant to this section or the facts disclosed in the investigation, but this subsection (4) does not apply to disclosures in actions or enforcement proceedings pursuant to this code.
Except as otherwise provided, the provisions of sections 24-4-102 to 24-4-106, C.R.S., apply to and govern all rules promulgated and all administrative action taken by the administrator pursuant to this article or the provisions on supervised loans contained in part 3 of article 2 of this title; except that section 24-4-104 (3), C.R.S., shall not apply to any such action.
Any person aggrieved by any final action or order of the administrator and affected thereby is entitled to a review thereof by the Colorado court of appeals by appropriate proceedings under section 24-4-106 (11), C.R.S.
(1) After notice and hearing, the administrator may order a creditor or a person acting in the creditor's behalf to cease and desist from engaging in violations of this code or any rule or order lawfully made pursuant to this code. The order issued by the administrator may also require the creditor or person to make refunds to consumers of excess charges under this code and pay a penalty up to a maximum of one thousand dollars for each violation, all or part of which may be specifically designated for consumer and creditor educational purposes.
(2) A respondent aggrieved by an order of the administrator may obtain judicial review of the order in the Colorado court of appeals. The administrator may obtain an order of the court for enforcement of the administrator's order in the district court under section 24-4-106, C.R.S. All proceedings under this section shall be governed by sections 24-4-105 and 24-4-106, C.R.S.
(3) With respect to unconscionable agreements or fraudulent or unconscionable conduct by the respondent, the administrator may not issue an order pursuant to this section but may bring a civil action for an injunction under section 5-6-112.
If it is claimed that a person has engaged in conduct subject to an order by the administrator described in section 5-6-108 or by a court described in sections 5-6-111 to 5-6-113, the administrator may accept an assurance in writing that the person will not engage in the conduct in the future. The assurance may also require the person to make refunds to consumers of excess charges under this code, pay a penalty up to a maximum of one thousand dollars for each violation, all or part of which may be specifically designated for consumer and creditor educational purposes, and reimburse the administrator for the administrator's reasonable costs incurred in investigating the conduct. If a person giving an assurance of discontinuance fails to comply with its terms, the assurance is evidence that prior to the assurance such person engaged in the conduct described in the assurance.
The administrator may bring a civil action to restrain a person from violating this code or rules or regulations promulgated thereunder and for other appropriate relief.
(1) The administrator may bring a civil action to restrain a creditor or a person acting in the creditor's behalf from engaging in a course of:
(a) Making or enforcing unconscionable terms or provisions of consumer credit transactions;
(b) Fraudulent or unconscionable conduct in inducing consumers to enter into consumer credit transactions;
(c) Conduct of any of the types specified in paragraph (a) or (b) of this subsection (1) with respect to transactions that give rise to or lead persons to believe they will give rise to consumer credit transactions; or
(d) Fraudulent or unconscionable conduct in the collection of debts arising from consumer credit transactions.
(2) In an action brought pursuant to this section, the court may grant relief only if it finds:
(a) That the respondent has made unconscionable agreements or has engaged or is likely to engage in a course of fraudulent or unconscionable conduct;
(b) That the agreements or conduct of the respondent has caused or is likely to cause injury to consumers; and
(c) That the respondent has been able to cause or will be able to cause the injury primarily because the transactions involved are credit transactions.
(3) In applying this section, consideration shall be given to each of the following factors, among others:
(a) Whether the creditor should have reasonably believed at the time consumer credit transactions were made that, according to the credit terms or schedule of payments, there was no reasonable probability of payment in full of the obligation by the consumer;
(b) Whether the creditor reasonably should have known, at the time of the transaction, of the inability of the consumer to receive substantial benefits from the transaction;
(c) Gross disparity between the price of the transaction and its value measured by the price at which similar transactions are readily obtainable by like consumers;
(d) The fact that the creditor contracted for or received separate charges for insurance with respect to consumer credit transactions with the effect of making the transactions, considered as a whole, unconscionable;
(e) The fact that the respondent has knowingly taken advantage of the inability of the consumer reasonably to protect his or her interests by reason of physical or mental infirmities, ignorance, illiteracy, or inability to understand the language of the agreement, or similar factors; and
(f) Any of the factors set forth in section 5-5-109 (4).
(4) The administrator may bring a civil action to restrain a creditor or a person acting in the creditor's behalf from engaging in a course of making or arranging consumer loans to enable consumers to buy or lease from a particular seller or lessor goods or services, a principal purpose of which course of action is to avoid giving the consumers those rights that they would have had if the transactions were entered into as a consumer credit sale if:
(a) The lender is a person related to the seller or lessor unless the relationship is remote or is not a factor in the transaction;
(b) The seller or lessor guarantees the loans or otherwise assumes the risk of loss by the lender upon the loans;
(c) The loans are conditioned upon the consumer's purchase or lease of the goods or services from the particular seller or lessor, but the lender's payment of proceeds of the loan to the seller or lessor does not in itself establish that the loan was so conditioned; or
(d) The lender, before the lender makes the consumer loan, has knowledge or, from the lender's course of dealing with the particular seller or lessor or from the lender's records, notice of substantial complaints by other consumers of the particular seller's or lessor's failure or refusal to perform his or her contracts with them and of the particular seller's or lessor's failure to remedy his or her defaults within a reasonable time after notice to him or her of the complaints.
(5) In an action brought pursuant to this code, a charge or practice expressly permitted by this code is not in itself unconscionable.
With respect to an action brought to enjoin violations of this code under section 5-6-111 or unconscionable agreements or fraudulent or unconscionable conduct under section 5-6-112, the administrator may apply to the court for a temporary restraining order or a preliminary injunction against a respondent pending final determination of proceedings. If the court finds after a hearing that there is reasonable cause to believe that the respondent is engaging in or is likely to engage in conduct sought to be restrained, it may grant any such temporary restraining order or preliminary injunction it deems appropriate. The court may also issue such orders or judgments as may be necessary to completely compensate or restore to his or her original position any consumer affected by such violation, agreement, or conduct or if there is reasonable cause to believe funds to make refunds of excess charges under this code will not be available at a future date. No bond or other security is required of the administrator before relief under this section may be granted.
(1) (a) The administrator may bring a civil action against a creditor for making or collecting charges in excess of those permitted by this code, violating any of the provisions of this code applying to limitations on the schedule of payments or loan term for supervised loans or authority to make supervised loans, or for disclosure violations. An action may relate to transactions with more than one consumer. If it is found that an excess charge has been made, the court shall order the respondent to refund to the consumer the amount of the excess charge and to pay a penalty to the consumer as provided in sections 5-5-201 and 5-5-202.
(b) If a creditor has made an excess charge in deliberate violation of or in reckless disregard for this code or if a creditor has refused to refund an excess charge within a reasonable time after demand by the consumer or the administrator, the court may also order the respondent to pay to the consumers a civil penalty in an amount determined by the court not in excess of the greater of either the amount of the finance charge or ten times the amount of the excess charge. Refunds and penalties to which the consumer is entitled pursuant to this subsection (1) may be set off against the consumer's obligation.
(c) If a consumer brings an action against a creditor to recover an excess charge or civil penalty, an action by the administrator to recover for the same excess charge or civil penalty shall be stayed while the consumer's action is pending and shall be dismissed if the consumer's action is dismissed with prejudice or results in a final judgment granting or denying the consumer's claim. There shall be no double recovery for refunds of excess charges or a penalty payable to the consumer.
(d) With respect to excess charges arising from revolving accounts, no action pursuant to this subsection (1) may be brought more than four years after the time the excess charge was made. With respect to excess charges arising from other consumer credit transactions, no action pursuant to this subsection (1) may be brought more than four years after the due date of the last scheduled payment of the agreement pursuant to which the charge was made.
(e) If the creditor establishes by a preponderance of evidence that a violation is unintentional or the result of a bona fide error, no liability to pay a penalty shall be imposed under this subsection (1).
(2) The administrator may bring a civil action against a creditor or a person acting in the creditor's behalf to recover a civil penalty for willfully violating this code, and, if the court finds that the defendant has engaged in a course of repeated and willful violations of this code, it may assess a civil penalty of no more than five thousand dollars. All or part of the penalty under this subsection (2) may be specifically designated for consumer and creditor education. No civil penalty pursuant to this subsection (2) may be imposed for violations of this code occurring more than four years before the action is brought or for making unconscionable agreements or engaging in a course of fraudulent or unconscionable conduct.
(3) If the administrator prevails in an action brought under this section, the administrator may recover his or her reasonable costs in investigating and bringing the action and request an order for reimbursement of his or her reasonable attorney fees.
In an action brought by the administrator under this code, the administrator has no right to trial by jury, but this will not prevent a defendant from requesting a jury trial under the Colorado rules of civil procedure.
The grant of powers to the administrator in this article does not affect remedies available to consumers under this code or under other principles of law or equity.
PART 2 NOTIFICATION AND FEES
(1) Except as provided in subsections (2) and (3) of this section, this part 2 applies if a person:
(a) Makes consumer credit sales and charges or collects a finance charge, or makes consumer leases, and if the person collects payments under the obligation for more than thirty days after inception of the consumer credit sale or consumer lease; or
(b) Takes assignments of and undertakes direct collection of payments from, or enforcement of rights against, consumers arising from consumer credit sales or consumer leases.
(2) This part 2 does not apply to supervised lenders described in section 5-1-301 (46), persons making consumer loans described in section 5-1-301 (15), or to persons licensed as collection agencies pursuant to article 14 of title 12, C.R.S.
(3) Sections 5-6-203 (5) and 5-6-204 of this part 2 apply to all fees collected under this code.
(1) Persons subject to this part 2 shall file notification with, and pay the fee prescribed in section 5-6-203 to, the administrator within thirty days after commencing business in this state and, thereafter, on or before January 31 of each year. The notification shall state:
(a) Name of the person;
(b) Name in which business is transacted if different from paragraph (a) of this subsection (1);
(c) Address of principal office, which may be outside this state;
(d) Address of all offices or retail stores, if any, in this state at which consumer credit sales or consumer leases are made or, in the case of a person taking assignments of obligations, the offices or places of business within this state at which business is transacted;
(e) If consumer credit sales or consumer leases are made otherwise than at an office or retail store in this state, a brief description of the manner in which they are made;
(f) Address of designated agent upon whom service of process may be made in this state described in section 5-1-203; and
(g) Whether supervised loans are made.
(2) If information in a notification becomes inaccurate after filing, no further notification is required until the following January 31.
(1) A person required to file notification shall, with the first notification and on or before January 31 of each year thereafter, pay to the administrator a nonrefundable annual notification fee of twenty dollars.
(2) Persons required to file notification who are sellers or lessors shall pay an additional nonrefundable annual volume fee on or before January 31 of each year in the amount of twelve dollars for each one hundred thousand dollars, or part thereof, in excess of one hundred thousand dollars, of the original unpaid balances arising from consumer credit sales or consumer leases made in this state within the preceding calendar year and held either by the creditor for more than thirty days after the inception of the sale or lease giving rise to the obligations or by an assignee who has not filed notification. A refinancing of a sale or lease resulting in an increase in the amount of an obligation is considered a new sale or lease to the extent of the amount of the increase.
(3) Persons required to file notification who are assignees of consumer credit sales or consumer leases shall pay an additional nonrefundable annual volume fee on or before January 31 of each year in the amount of twelve dollars for each one hundred thousand dollars, or part thereof, of the unpaid balances at the time of the assignment of obligations arising from consumer credit sales or consumer leases made in this state and taken by assignment during the preceding calendar year, but an assignee need not pay a volume fee with respect to an obligation on which the assignor or other person has already paid a volume fee.
(4) A penalty of five dollars per day shall be imposed on any person failing to comply with this section; except that, if the fees required by this section are paid on or before March 1 of each year, no penalty shall be imposed. If a person required to file notification and pay a notification fee fails to do so, the consumer shall have no obligation to pay the finance charge due under the consumer credit transaction and any finance charges paid shall be refunded to the consumer. In addition, the administrator shall be entitled to examine the loans, business, and records of such person without issuance of a subpoena and the person shall pay the reasonable and necessary examination expenses of the administrator.
(5) Notwithstanding the amount specified for any fee in this section or in section 5-2-302 (1), the administrator by rule or as otherwise provided by law may reduce the amount of one or more of the fees if necessary pursuant to section 24-75-402 (3), C.R.S., to reduce the uncommitted reserves of the fund to which all of any portion of one or more of the fees is credited. After the uncommitted reserves of the fund are sufficiently reduced, the administrator by rule or as otherwise provided by law may increase the amount of one or more of the fees as provided in section 24-75-402 (4), C.R.S.
(1) All fees collected under this code and under article 10 of this title shall be credited to the uniform consumer credit code cash fund, which fund is hereby created, and all moneys credited to such fund shall be used for the administration and enforcement of this code, article 10 of this title, and article 14.5 of title 12, C.R.S. Interest earned on the fund shall be credited to the fund. The general assembly shall make annual appropriations out of the fund for the administration and enforcement of this code, article 10 of this title, and article 14.5 of title 12, C.R.S.; except that expenditures by the administrator for consumer and creditor education resulting from the penalties provided in sections 5-2-303 (7) (f), 5-6-109 (1), 5-6-110, and 5-6-114 (2) shall not require appropriation by the general assembly if such expenditures do not exceed twenty-five thousand dollars per fiscal year and do not include the hiring of any full-time equivalents.
(2) Notwithstanding any provision of subsection (1) of this section to the contrary, on March 27, 2002, the state treasurer shall deduct one hundred fifty thousand dollars from the uniform consumer credit code cash fund and transfer such sum to the general fund.
(3) Notwithstanding any provision of subsection (1) of this section to the contrary, on March 5, 2003, the state treasurer shall deduct one hundred thousand dollars from the uniform consumer credit code cash fund and transfer such sum to the general fund.
PART 3 COUNCIL OF ADVISORS ON CONSUMER CREDIT
(1) There is hereby created the council of advisors on consumer credit consisting of nine members who shall be appointed by the governor. One of the advisors shall be designated by the governor as chairperson. In appointing members of the council, the governor shall seek to achieve a fair representation from the various segments of the consumer credit industry and public.
(2) The term of office of each member of the council is three years. A member chosen to fill a vacancy arising otherwise than by expiration of a term shall be appointed for the unexpired term of the member whom he or she is to succeed. A member of the council is eligible for reappointment.
(3) Members of the council shall serve without compensation but are entitled to reimbursement of actual and necessary expenses incurred in the performance of their duties.
(1) The council shall advise and consult with the administrator concerning the exercise of the administrator's powers under this code and may make recommendations to the administrator. Members of the council may assist the administrator in obtaining compliance with this code. Since it is an objective of this part 3 to obtain competent representatives of creditors and the public to serve on the council and to assist and cooperate with the administrator in achieving the objectives of this code, service on the council shall not in itself constitute a conflict of interest regardless of the occupations or associations of the members.
(2) (a) There is hereby created a subcommittee of the council of advisors on consumer credit for the purpose specified in paragraph (b) of this subsection (2). The subcommittee shall consist of the attorney general, the chairperson of the council, and three members of the council appointed by such chairperson. Of the subcommittee members who are also members of the council, two shall be representatives of the consumer credit industry and two shall be representatives of the public. Any action taken by a majority of the subcommittee shall constitute action by the council.
(b) The subcommittee may review, repeal, amend, or modify any rule promulgated by the administrator pursuant to section 5-6-104 (1) (e).
CO Colorado Official State Statutes
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