Kentucky Changes Licensing Requirements for Consumer Loan Companies | PC Weiner Brodsky Kider

On March 26, 2019, Kentucky Governor Matt Bevin signed into law a bill, House Bill 285 (HB 285), which changes the requirements for consumer loan companies in Kentucky.

Some of the key provisions of HB 285 include the following:

  • Increases the investigation fee for a consumer loan company license application from $250 to $500 and increases the annual license fee for each location from $400 to $500;

  • Establishes new bond and net worth requirements for consumer loan company license applicants;

  • Requires a consumer loan company to have at least one principal director (i.e. a natural person with the required experience who is primarily responsible for the operations of a licensee) and establishes the standards for that person ;

  • Provides requirements for a change of control involving a consumer loan company;

  • Authorizes the Commissioner of Financial Institutions (the Commissioner) to take adverse action against a consumer loan company in certain specified circumstances (for example, if the company has committed fraud or made a misrepresentation on a material fact, or if the company has demonstrated incompetence or lack of confidence to act as a licensee);

  • Requires a consumer loan company to maintain an agent in Kentucky for service of process; and

  • Indicates that the Commissioner must conduct a review of a consumer loan company licensee once every 2 years, instead of once a year.

The changes made by HB 285 come into effect on June 26, 2019.

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