Full Text of SB0675 97th General Assembly
SB0675eng 97TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Funeral or Burial Funds Act is | 5 | | amended by changing Sections 1a-1, 2, 3, and 3a-5 as follows:
| 6 | | (225 ILCS 45/1a-1)
| 7 | | Sec. 1a-1. Pre-need contracts.
| 8 | | (a) It shall be unlawful for any seller doing business
| 9 | | within
this State to accept sales proceeds from a purchaser, | 10 | | either directly or
indirectly by any means, unless the seller | 11 | | enters into a
pre-need contract
with the purchaser which meets | 12 | | the following requirements:
| 13 | | (1) It states the name and address of the principal | 14 | | office of the
seller and the parent company of the
seller, | 15 | | if
any.
| 16 | | (1.5) If funded by a trust, it clearly identifies the | 17 | | trustee's name and address and the primary state or federal | 18 | | regulator of the trustee as a corporate fiduciary. | 19 | | (1.7) If funded by life insurance, it clearly | 20 | | identifies the life insurance provider and the primary | 21 | | regulator of the life insurance provider.
| 22 | | (2) It clearly identifies the provider's name and
| 23 | | address,
the purchaser, and
the beneficiary, if other than |
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| 1 | | the purchaser.
| 2 | | (2.5) If the provider has branch locations, the | 3 | | contract
gives the purchaser the opportunity to identify | 4 | | the branch
at which the funeral will be provided.
| 5 | | (3) It contains a complete description of the funeral | 6 | | merchandise and
services to be provided and the price of | 7 | | the merchandise and services, and it
clearly discloses | 8 | | whether the price of the merchandise and services is
| 9 | | guaranteed or not guaranteed as to price.
| 10 | | (A) Each guaranteed price contract shall contain | 11 | | the following
statement in 12 point bold type:
| 12 | | THIS CONTRACT GUARANTEES THE BENEFICIARY THE | 13 | | SPECIFIC GOODS AND
SERVICES CONTRACTED FOR. NO | 14 | | ADDITIONAL CHARGES MAY BE REQUIRED.
FOR DESIGNATED | 15 | | GOODS AND SERVICES, ADDITIONAL CHARGES MAY BE INCURRED | 16 | | FOR
UNEXPECTED EXPENSES INCLUDING, BUT NOT LIMITED TO, | 17 | | CASH ADVANCES, SHIPPING OF
REMAINS FROM A DISTANT | 18 | | PLACE, OR DESIGNATED HONORARIA ORDERED OR DIRECTED BY
| 19 | | SURVIVORS.
| 20 | | (B) Except as provided in subparagraph (C) of this | 21 | | paragraph (3),
each non-guaranteed price contract | 22 | | shall contain the following
statement in 12 point bold | 23 | | type:
| 24 | | THIS CONTRACT DOES NOT GUARANTEE THE PRICE THE | 25 | | BENEFICIARY WILL PAY FOR
ANY SPECIFIC GOODS OR | 26 | | SERVICES. ANY FUNDS PAID UNDER THIS CONTRACT ARE ONLY A
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| 1 | | DEPOSIT TO BE APPLIED TOWARD THE FINAL PRICE OF THE | 2 | | GOODS OR SERVICES
CONTRACTED FOR. ADDITIONAL CHARGES | 3 | | MAY BE REQUIRED.
| 4 | | (C) If a non-guaranteed price contract may
| 5 | | subsequently become guaranteed, the contract shall | 6 | | clearly
disclose the nature of the guarantee and the | 7 | | time,
occurrence, or event upon which the contract | 8 | | shall become a
guaranteed price contract.
| 9 | | (4) It provides that if the particular supplies and | 10 | | services specified
in the pre-need contract are | 11 | | unavailable at the time of delivery, the provider
shall be | 12 | | required to furnish supplies and services similar in style | 13 | | and at
least equal in quality of material and workmanship.
| 14 | | (5) It discloses any penalties or restrictions, | 15 | | including
but not limited
to geographic restrictions or the | 16 | | inability of the provider
to
perform, on the delivery of | 17 | | merchandise, services, or pre-need contract
guarantees.
| 18 | | (6) Regardless of the method of funding the pre-need | 19 | | contract, the
following must be disclosed:
| 20 | | (A) Whether the pre-need contract is to be funded | 21 | | by a trust, life
insurance, or an annuity;
| 22 | | (B) The nature of the relationship among the person
| 23 | | funding the
pre-need contract, the provider, and the
| 24 | | seller; and
| 25 | | (C) The impact on the pre-need contract of (i) any | 26 | | changes in the
funding arrangement including but not |
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| 1 | | limited to changes in the assignment,
beneficiary | 2 | | designation, or use of the funds; (ii) any specific | 3 | | penalties
to be incurred
by the contract purchaser as a | 4 | | result of failure to make payments; (iii)
penalties to | 5 | | be incurred or moneys or refunds to be received as a | 6 | | result of
cancellations; and (iv) all relevant | 7 | | information concerning what occurs and
whether any | 8 | | entitlements or obligations arise if there is a | 9 | | difference between
the proceeds of the particular | 10 | | funding arrangement and the amount actually
needed to | 11 | | pay for the funeral at-need.
| 12 | | (D) The method of changing the
provider.
| 13 | | (b) All pre-need contracts are subject to the Federal Trade | 14 | | Commission Rule
concerning the Cooling-Off Period for | 15 | | Door-to-Door Sales (16 CFR Part 429).
| 16 | | (c) No pre-need contract shall be sold in this State unless
| 17 | | there is a provider for the services and personal property | 18 | | being
sold. If the seller is not a provider, then the seller | 19 | | must have a binding agreement with a provider, and
the identity | 20 | | of the provider and the nature of the agreement between the | 21 | | seller
and the provider shall be disclosed in the pre-need | 22 | | contract at the time of the
sale and before the receipt of any | 23 | | sales proceeds. The failure to disclose the
identity of the | 24 | | provider, the nature of the agreement between the seller and
| 25 | | the provider, or any changes thereto to the purchaser and | 26 | | beneficiary, or the
failure to make the disclosures required in |
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| 1 | | subdivision (a)(1), constitutes an
intentional violation of | 2 | | this Act.
| 3 | | (d) All pre-need contracts must be in writing in at least | 4 | | 11 point type,
numbered, and executed in duplicate. A signed
| 5 | | copy of the pre-need contract must be provided to the purchaser | 6 | | at the time of
entry into the pre-need contract. The | 7 | | Comptroller may by rule develop
a model pre-need contract form | 8 | | that meets the requirements of this Act.
| 9 | | (e) The State Comptroller shall by rule develop a booklet | 10 | | for
consumers in plain English describing
the scope, | 11 | | application, and consumer protections of this Act. After the
| 12 | | adoption of these rules, no pre-need contract shall be sold in | 13 | | this State
unless (i) the seller distributes to the purchaser | 14 | | prior to the sale a
booklet promulgated or approved for use by | 15 | | the State Comptroller; (ii) the
seller explains to the | 16 | | purchaser the terms of the pre-need contract prior to
the | 17 | | purchaser signing; and (iii) the purchaser initials a statement | 18 | | in the
contract confirming that the seller has explained the | 19 | | terms of the contract
prior to the purchaser signing.
| 20 | | (f) All sales proceeds received in connection with a | 21 | | pre-need
contract shall be deposited into a trust account as | 22 | | provided in
Section 1b and Section 2 of this Act, or shall be | 23 | | used to purchase a life
insurance policy or tax-deferred | 24 | | annuity as provided in Section 2a
of this Act.
| 25 | | (g) No pre-need contract shall be sold in this State unless | 26 | | it is
accompanied by a funding mechanism permitted under this |
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| 1 | | Act, and unless the
seller is licensed by the Comptroller as | 2 | | provided in Section 3
of this Act.
Nothing in this Act is | 3 | | intended to relieve sellers of pre-need
contracts from
being | 4 | | licensed under any other Act required for their profession or | 5 | | business,
and being subject to the rules promulgated to | 6 | | regulate their profession or
business, including rules on | 7 | | solicitation and advertisement.
| 8 | | (h) Each pre-need contract entered into under this Section | 9 | | shall be registered on an online database maintained by the | 10 | | State Comptroller. Information to be included in the database | 11 | | shall include, but not be limited to, the name of licensee, | 12 | | purchaser, date of contract, amount of contract, and | 13 | | disposition of the funds. This information must be registered | 14 | | into the State Comptroller's online database within 45 days | 15 | | after the date of the pre-need contract. | 16 | | (Source: P.A. 96-879, eff. 2-2-10.)
| 17 | | (225 ILCS 45/2) (from Ch. 111 1/2, par. 73.102)
| 18 | | Sec. 2.
(a) If a purchaser selects a trust arrangement to | 19 | | fund the
pre-need contract, all trust deposits as determined by | 20 | | Section 1b shall be made
within 30 days of receipt.
| 21 | | (b) A trust established under this Act must be maintained | 22 | | with a corporate fiduciary as defined in Section 1-5.05 of the | 23 | | Corporate Fiduciary Act or with a foreign corporate fiduciary | 24 | | recognized by Article IV of the Corporate Fiduciary Act .
| 25 | | (c) Trust agreements and amendments to the trust agreements |
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| 1 | | used to
fund a pre-need contract shall be filed with the | 2 | | Comptroller.
| 3 | | (d) (Blank).
| 4 | | (e) A seller or provider shall furnish to the trustee and | 5 | | depositary the
name of each payor and the amount of payment on | 6 | | each such account for which
deposit is being so made. Nothing | 7 | | shall prevent the trustee from commingling the
deposits in any | 8 | | such trust fund for purposes of its management and the
| 9 | | investment of its funds as provided in the Common Trust Fund | 10 | | Act. In addition,
multiple trust funds maintained under this | 11 | | Act may be commingled or commingled
with other funeral or | 12 | | burial related trust funds if all record keeping
requirements | 13 | | imposed by law are met.
| 14 | | (f) (Blank).
| 15 | | (g) Upon no less than 30 days prior notice to the | 16 | | Comptroller, the seller may change
the trustee of
the fund. | 17 | | Failure to provide the Comptroller with timely prior notice is | 18 | | an intentional violation of this Act. | 19 | | (h) A trustee shall at least annually furnish to each | 20 | | purchaser a statement containing: (1) the receipts, | 21 | | disbursements, and inventory of the trust, including an | 22 | | explanation of any fees or expenses charged by the trustee | 23 | | under Section 5 of this Act or otherwise, (2) an explanation of | 24 | | the purchaser's right to a refund, if any, under this Act, and | 25 | | (3) identifying the primary regulator of the trust as a | 26 | | corporate fiduciary under state or federal law.
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| 1 | | (Source: P.A. 96-879, eff. 2-2-10.)
| 2 | | (225 ILCS 45/3) (from Ch. 111 1/2, par. 73.103)
| 3 | | Sec. 3. Licensing.
| 4 | | (a) No person, firm, partnership, association or | 5 | | corporation may act as
seller without first securing from the | 6 | | State Comptroller a
license to
so act. Application for such | 7 | | license shall be in writing, signed by the
applicant and duly | 8 | | verified on forms furnished by the Comptroller. Each
| 9 | | application shall contain at least the following:
| 10 | | (1) The full name and
address (both residence and place | 11 | | of business) of the applicant, and
every member, officer | 12 | | and director thereof if the applicant is a firm,
| 13 | | partnership, association, or corporation, and of every | 14 | | shareholder
holding
more than 10% of the corporate stock if | 15 | | the applicant is a corporation;
| 16 | | (2) A statement of the applicant's
assets and | 17 | | liabilities;
| 18 | | (3) The name and address of the applicant's principal
| 19 | | place of business at which the books, accounts, and
records | 20 | | shall be available for examination by the
Comptroller as | 21 | | required by this Act;
| 22 | | (4) The names and addresses of the applicant's branch
| 23 | | locations at which pre-need sales shall be conducted and
| 24 | | which shall operate under the same license number as the
| 25 | | applicant's principal place of business;
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| 1 | | (5) For each individual listed under item (1) above, a
| 2 | | detailed statement of the individual's business
experience | 3 | | for the 10 years immediately preceding the
application; any | 4 | | present or prior connection between the
individual and any | 5 | | other person engaged in pre-need
sales; any felony or | 6 | | misdemeanor convictions for which
fraud was an essential | 7 | | element; any charges or
complaints lodged against the | 8 | | individual for which fraud
was an essential element and | 9 | | which resulted in civil or
criminal litigation; any failure | 10 | | of the individual to
satisfy an enforceable judgment | 11 | | entered against him
based upon fraud; and any other | 12 | | information requested by
the Comptroller relating to past | 13 | | business practices of
the individual. Since the | 14 | | information required by this
item (5) may be confidential | 15 | | or contain proprietary
information, this information shall | 16 | | not be available to
other licensees or the general public | 17 | | and shall be used
only for the lawful purposes of the | 18 | | Comptroller in
enforcing this Act;
| 19 | | (6) The name of the trustee and, if applicable, the
| 20 | | names of the advisors to the trustee, including a copy
of | 21 | | the proposed trust agreement under which the trust
funds | 22 | | are to be held as required by this Act; and
| 23 | | (7) Such other information as the Comptroller may
| 24 | | reasonably require in order to determine the
qualification | 25 | | of the applicant to be licensed under this
Act.
| 26 | | (b) Applications for
license shall be accompanied
by a |
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| 1 | | fidelity bond executed by the applicant and a surety company
| 2 | | authorized to do business in this State or an irrevocable, | 3 | | unconditional
letter of credit issued by a bank, credit union, | 4 | | or trust company authorized to
do business in the State of | 5 | | Illinois, as approved by the State Comptroller, in
such amount | 6 | | not exceeding $10,000 as the Comptroller may require. If, after
| 7 | | notice and an opportunity to be heard, it
has been determined | 8 | | that a licensee has violated this Act within the past 5
| 9 | | calendar years, the Comptroller may require an additional bond | 10 | | or letter of credit
from the licensee from time to time in | 11 | | amounts equal to one-tenth of such trust
funds, which bond or | 12 | | letter of credit shall run to the Comptroller for the use
and | 13 | | benefit of the beneficiaries of such trust funds.
| 14 | | The licensee shall keep accurate accounts, books and | 15 | | records in this State,
at the principal place of business | 16 | | identified in the
licensee's license application or as | 17 | | otherwise approved by
the Comptroller in writing,
of
all | 18 | | transactions, copies of all pre-need contracts, trust | 19 | | agreements, and other
agreements, dates and amounts of payments | 20 | | made and accepted thereon, the names
and addresses of the | 21 | | contracting parties, the persons for whose benefit such
funds | 22 | | are accepted, and the names of the depositaries of such funds.
| 23 | | Each licensee shall maintain the documentation for a period
of | 24 | | 3 years after the licensee has fulfilled his obligations
under | 25 | | the pre-need contract. Additionally, for a period
not to exceed | 26 | | 6 months after the performance of all terms
in a pre-need sales |
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| 1 | | contract, the licensee shall maintain
copies of the contract at | 2 | | the licensee branch location
where the contract was entered or | 3 | | at some other location agreed to by the
Comptroller in writing.
| 4 | | If an
insurance policy or tax-deferred annuity is used to fund | 5 | | the pre-need contract,
the licensee under this Act shall keep | 6 | | and maintain accurate accounts, books,
and records in this | 7 | | State, at the principal place of business identified in
the
| 8 | | licensee's application or as otherwise approved by the
| 9 | | Comptroller in writing,
of all insurance policies and | 10 | | tax-deferred annuities
used to fund the pre-need contract, the | 11 | | name and address of insured, annuitant,
and initial | 12 | | beneficiary, and the name and address of the insurance company
| 13 | | issuing the policy or annuity. If a life insurance policy or | 14 | | tax-deferred
annuity is used to fund a pre-need contract, the | 15 | | licensee shall notify the
insurance company of the name of each | 16 | | pre-need contract purchaser and the
amount of each payment when | 17 | | the pre-need contract, insurance policy or annuity
is | 18 | | purchased.
| 19 | | The licensee shall make reports to the Comptroller annually | 20 | | or at such other
time as the Comptroller may require, on forms | 21 | | furnished by the Comptroller. The
licensee shall file the | 22 | | annual report with the Comptroller within 75 days after
the end | 23 | | of the licensee's fiscal year. The Comptroller shall for good | 24 | | cause
shown grant an extension for the filing of the annual | 25 | | report upon the written
request of the licensee. Such extension | 26 | | shall not exceed 60 days. If a
licensee fails to submit an |
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| 1 | | annual report to the Comptroller within the time
specified in | 2 | | this Section, the Comptroller shall impose upon the licensee a
| 3 | | penalty of $5 per day for the first 15 days past due, $10 per | 4 | | day for 16 through 30 days past due, $15 per day for 31 through | 5 | | 45 days past due, and $20 per day for the 46th day and every day | 6 | | thereafter for each and every day the licensee remains | 7 | | delinquent in
submitting the annual report. The Comptroller may | 8 | | abate all or part of the
$5 daily penalty for good cause shown. | 9 | | Every application shall be
accompanied by a check
or money | 10 | | order in the amount of $25 and every report shall be | 11 | | accompanied by a
check or money order in the amount of $10 | 12 | | payable to: Comptroller, State of
Illinois.
| 13 | | The licensee shall make all required books and records | 14 | | pertaining to trust
funds, insurance policies, or tax-deferred | 15 | | annuities available to the
Comptroller for examination. The | 16 | | Comptroller, or a person designated by the
Comptroller who is | 17 | | trained to perform such examinations, may at any time
| 18 | | investigate the books, records and accounts of the licensee | 19 | | with respect to
trust funds, insurance policies, or | 20 | | tax-deferred annuities and for that purpose
may require the | 21 | | attendance of and examine under oath all persons whose
| 22 | | testimony he may require. The licensee shall pay a fee for such | 23 | | examination in
accordance with a schedule established by the | 24 | | Comptroller. The fee shall not
exceed the cost of such | 25 | | examination. For pre-need contracts funded by trust
| 26 | | arrangements, the cost of an initial examination shall be borne |
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| 1 | | by the
licensee if it
has $10,000 or more in trust funds, | 2 | | otherwise, by the Comptroller. The charge
made by the | 3 | | Comptroller for an examination shall be based upon the total | 4 | | amount
of trust funds held by the licensee at the end of the | 5 | | calendar or fiscal year
for which the report is required by | 6 | | this Act and shall be in accordance with
the following | 7 | | schedule:
| 8 | | Less than $10,000 .................................no charge;
| 9 | | $10,000 or more but less than $50,000 ...................$10;
| 10 | | $50,000 or more but less than $100,000 ..................$40;
| 11 | | $100,000 or more but less than $250,000 .................$80;
| 12 | | $250,000 or more ........................................$100.
| 13 | | The Comptroller may order additional audits or | 14 | | examinations as he or she
may deem necessary or advisable to | 15 | | ensure the safety and stability of the trust
funds and to | 16 | | ensure compliance with this Act. These additional audits or
| 17 | | examinations shall only be made after good cause is established | 18 | | by the
Comptroller in the written order. The grounds for | 19 | | ordering these additional
audits or examinations may include, | 20 | | but shall not be limited to:
| 21 | | (1) material and unverified changes or fluctuations in | 22 | | trust balances or
insurance or annuity policy amounts;
| 23 | | (2) the licensee changing trustees more than twice in | 24 | | any 12-month
period;
| 25 | | (3) any withdrawals or attempted withdrawals from the | 26 | | trusts, insurance
policies, or annuity contracts in |
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| 1 | | violation of this Act; or
| 2 | | (4) failure to maintain or produce documentation | 3 | | required by this Act for
deposits into trust accounts, | 4 | | trust investment activities, or life insurance or
annuity | 5 | | policies.
| 6 | | The
licensee shall bear the full cost of that examination | 7 | | or audit, up to a maximum
of $20,000. The
Comptroller may elect | 8 | | to pay for the examination or audit and receive
reimbursement | 9 | | from the licensee. Payment of the costs of the examination or
| 10 | | audit by a licensee shall be a condition of receiving, | 11 | | maintaining, or renewing
a license
under this Act. All moneys | 12 | | received by the Comptroller for examination or
audit fees shall | 13 | | be maintained in a separate account to be known as the
| 14 | | Comptroller's Administrative
Fund. This
Fund, subject to | 15 | | appropriation by the General Assembly, may
be utilized by the | 16 | | Comptroller for
enforcing this Act and other purposes that may | 17 | | be authorized by law.
| 18 | | For pre-need contracts funded by life insurance or a | 19 | | tax-deferred annuity,
the cost of an examination shall be borne | 20 | | by the licensee. The fee
schedule for such examination shall be | 21 | | established in rules promulgated by the
Comptroller. In the | 22 | | event such investigation or other information received by
the | 23 | | Comptroller discloses a substantial violation of the | 24 | | requirements of this
Act, the Comptroller shall revoke the | 25 | | license of such person upon a hearing as
provided in this Act. | 26 | | Such licensee may terminate all further responsibility
for |
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| 1 | | compliance with the requirements of this Act by voluntarily | 2 | | surrendering
the license to the Comptroller, or in the event of | 3 | | its loss, furnishing the
Comptroller with a sworn statement to | 4 | | that effect, which states the licensee's
intention to | 5 | | discontinue acceptance of funds received under pre-need | 6 | | contracts.
Such license or statement must be accompanied by an | 7 | | affidavit that said
licensee has lawfully expended or refunded | 8 | | all funds received under pre-need
contracts, and that the | 9 | | licensee will accept no additional sales proceeds. The
| 10 | | Comptroller shall immediately cancel or revoke said license.
| 11 | | (Source: P.A. 96-879, eff. 2-2-10.)
| 12 | | (225 ILCS 45/3a-5)
| 13 | | Sec. 3a-5. License requirements.
| 14 | | (a) Every license issued by the Comptroller shall state
the | 15 | | number of the license, the business name and address of
the | 16 | | licensee's principal place of business, each branch
location | 17 | | also operating under the license, and the
licensee's parent | 18 | | company, if any. The license shall be
conspicuously posted in | 19 | | each place of business operating
under the license. The | 20 | | Comptroller may issue such
additional licenses as may be | 21 | | necessary for licensee branch
locations upon compliance with | 22 | | the provisions of this Act
governing an original issuance of a | 23 | | license for each new
license.
| 24 | | (b) Individual salespersons representing a licensee
shall | 25 | | not be required to obtain licenses in their
individual |
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| 1 | | capacities, but must acknowledge, by affidavit,
that they have | 2 | | been provided with a copy of and have read
this Act. The | 3 | | licensee shall retain copies of the affidavits
of its sellers | 4 | | for its records and shall make the affidavits
available to the | 5 | | Comptroller for examination upon request.
| 6 | | (c) The licensee shall be responsible for the activities
of | 7 | | any person representing the licensee in selling or
offering a | 8 | | pre-need contract for sale.
| 9 | | (d) Any person not selling on behalf of a licensee shall
| 10 | | obtain its own license.
| 11 | | (e) No license shall be transferable or assignable
without | 12 | | the express written consent of the Comptroller. A
transfer of | 13 | | more than 50% of the ownership of any business
licensed | 14 | | hereunder shall be deemed to be an attempted
assignment of the | 15 | | license originally issued to the licensee
for which consent of | 16 | | the Comptroller shall be required.
| 17 | | (f) Every license issued hereunder shall be renewed every 5 | 18 | | years for a renewal fee of $100. The renewal fee shall be | 19 | | deposited into the Comptroller's Administrative Fund remain in | 20 | | force
until it has been suspended, surrendered, or revoked in
| 21 | | accordance with this Act . The Comptroller, upon the request
of | 22 | | an interested person or on his own motion, may issue new
| 23 | | licenses to a licensee whose license or licenses have been
| 24 | | revoked, if no factor or condition then exists which would
have | 25 | | warranted the Comptroller to originally refuse the
issuance of | 26 | | such license.
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| 1 | | (Source: P.A. 92-419, eff. 1-1-02 .)
| 2 | | Section 10. The Cemetery Oversight Act is amended by | 3 | | changing Sections 15-15, 15-40, and 75-55 as follows: | 4 | | (225 ILCS 411/15-15) | 5 | | (Section scheduled to be repealed on January 1, 2021)
| 6 | | Sec. 15-15. Care funds; deposits; investments. | 7 | | (a) Whenever a cemetery authority accepts care funds, | 8 | | either in connection with the sale or giving away at an imputed | 9 | | value of an interment right, entombment right, or inurnment | 10 | | right, or in pursuance of a contract, or whenever, as a | 11 | | condition precedent to the purchase or acceptance of an | 12 | | interment right, entombment right, or inurnment right, such | 13 | | cemetery authority shall establish a care fund or deposit the | 14 | | funds in an already existing care fund. | 15 | | (b) The cemetery authority shall execute and deliver to the | 16 | | person from whom it received the care funds an instrument in | 17 | | writing that shall specifically state: (i) the nature and | 18 | | extent of the care to be furnished and (ii) that such care | 19 | | shall be furnished only in so far as net income derived from | 20 | | the amount deposited in trust will permit (the income from the | 21 | | amount so deposited, less necessary expenditures of | 22 | | administering the trust, shall be deemed the net income). | 23 | | (c) The setting-aside and deposit of care funds shall be | 24 | | made by such cemetery authority no later than 30 days after the |
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| 1 | | close of the month in which the cemetery authority gave away | 2 | | for an imputed value or received the final payment on the | 3 | | purchase price of interment rights, entombment rights, or | 4 | | inurnment rights, or received the final payment for the general | 5 | | or special care of a lot, grave, crypt, or niche or of a family | 6 | | mausoleum, memorial, marker, or monument, and such amounts | 7 | | shall be held by the trustee of the care funds of such cemetery | 8 | | authority in trust and in perpetuity for the specific purposes | 9 | | stated in the written instrument described in subsection (b). | 10 | | For all care funds received by a cemetery authority, except for | 11 | | care funds received by a cemetery authority pursuant to a | 12 | | specific gift, grant, contribution, payment, legacy, or | 13 | | contract that are subject to investment restrictions more | 14 | | restrictive than the investment provisions set forth in this | 15 | | Act, and except for care funds otherwise subject to a trust | 16 | | agreement executed by a person or persons responsible for | 17 | | transferring the specific gift, grant, contribution, payment, | 18 | | or legacy to the cemetery authority that contains investment | 19 | | restrictions more restrictive than the investment provisions | 20 | | set forth in this Act, the cemetery authority may, without the | 21 | | necessity of having to obtain prior approval from any court in | 22 | | this State, designate a new trustee in accordance with this Act | 23 | | and invest the care funds in accordance with this Section, | 24 | | notwithstanding any contrary limitation contained in the trust | 25 | | agreement. | 26 | | (d) Any cemetery authority engaged in selling or giving |
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| 1 | | away at an imputed value interment rights, entombment rights, | 2 | | or inurnment rights, in conjunction with the selling or giving | 3 | | away at an imputed value any other merchandise or services not | 4 | | covered by this Act, shall be prohibited from increasing the | 5 | | sales price or imputed value of those items not requiring a | 6 | | care fund deposit under this Act with the purpose of allocating | 7 | | a lesser sales price or imputed value to items that require a | 8 | | care fund deposit. | 9 | | (e) If any sale that requires a deposit to a cemetery | 10 | | authority's care fund is made by a cemetery authority on an | 11 | | installment basis, and the installment contract is factored, | 12 | | discounted, or sold to a third party, then the cemetery | 13 | | authority shall deposit the amount due to the care fund within | 14 | | 30 days after the close of the month in which the installment | 15 | | contract was factored, discounted, or sold. If, subsequent to | 16 | | such deposit, the purchaser defaults on the contract such that | 17 | | no care fund deposit on that contract would have been required, | 18 | | then the cemetery authority may apply the amount deposited as a | 19 | | credit against future required deposits. | 20 | | (f) The trust authorized by this Section shall be a single | 21 | | purpose trust fund. In the event of the cemetery authority's | 22 | | bankruptcy, insolvency, or assignment for the benefit of | 23 | | creditors, or an adverse judgment, the trust funds shall not be | 24 | | available to any creditor as assets of the cemetery authority | 25 | | or to pay any expenses of any bankruptcy or similar proceeding, | 26 | | but shall be retained intact to provide for the future |
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| 1 | | maintenance of the cemetery. Except in an action by the | 2 | | Department to revoke a license issued pursuant to this Act and | 3 | | for creation of a receivership as provided in this Act, the | 4 | | trust shall not be subject to judgment, execution, garnishment, | 5 | | attachment, or other seizure by process in bankruptcy or | 6 | | otherwise, nor to sale, pledge, mortgage, or other alienation, | 7 | | and shall not be assignable except as approved by the | 8 | | Comptroller Department .
| 9 | | (Source: P.A. 96-863, eff. 3-1-10.) | 10 | | (225 ILCS 411/15-40) | 11 | | (Section scheduled to be repealed on January 1, 2021)
| 12 | | Sec. 15-40. Trust examinations and audits. | 13 | | (a) The Comptroller Department shall examine at least | 14 | | annually every licensee who holds $250,000 or more in its care | 15 | | funds. For that purpose, the Comptroller Department shall have | 16 | | free access to the office and places of business and to such | 17 | | records of all licensees and of all trustees of the care funds | 18 | | of all licensees as shall relate to the acceptance, use, and | 19 | | investment of care funds. The Comptroller Department may | 20 | | require the attendance of and examine under oath all persons | 21 | | whose testimony may be required relative to such business. In | 22 | | such cases the Comptroller Department , or any qualified | 23 | | representative of the Comptroller Department whom the | 24 | | Comptroller Department may designate, may administer oaths to | 25 | | all such persons called as witnesses, and the Comptroller |
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| 1 | | Department , or any such qualified representative of the | 2 | | Comptroller Department , may conduct such examinations. The | 3 | | cost of an initial examination shall be determined by rule. | 4 | | (b) The Comptroller Department may order additional audits | 5 | | or examinations as it may deem necessary or advisable to ensure | 6 | | the safety and stability of the trust funds and to ensure | 7 | | compliance with this Act. These additional audits or | 8 | | examinations shall only be made after good cause is established | 9 | | by the Comptroller Department in the written order. The grounds | 10 | | for ordering these additional audits or examinations may | 11 | | include, but shall not be limited to:
| 12 | | (1) material and unverified changes or fluctuations in | 13 | | trust balances; | 14 | | (2) the licensee changing trustees more than twice in | 15 | | any 12-month period; | 16 | | (3) any withdrawals or attempted withdrawals from the | 17 | | trusts in violation of this Act; or | 18 | | (4) failure to maintain or produce documentation | 19 | | required by this Act.
| 20 | | (Source: P.A. 96-863, eff. 3-1-10.) | 21 | | (225 ILCS 411/75-55) | 22 | | (Section scheduled to be repealed on January 1, 2021)
| 23 | | Sec. 75-55. Transition.
| 24 | | (a) Within 60 days after the effective date of this Act, | 25 | | the Comptroller shall provide the Department copies of records |
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| 1 | | in the Comptroller's possession pertaining to the Cemetery Care | 2 | | Act and the Crematory Regulation Act that are necessary for the | 3 | | Department's immediate responsibilities under this Act. All | 4 | | other records pertaining to the Cemetery Care Act with the | 5 | | exception of records pertaining to care funds and the Crematory | 6 | | Regulation Act shall be transferred to the Department by March | 7 | | 1, 2012. In the case of records that pertain both to the | 8 | | administration of the Cemetery Care Act or the Crematory | 9 | | Regulation Act and to a function retained by the Comptroller, | 10 | | the Comptroller, in consultation with the Department, shall | 11 | | determine, within 60 days after the repeal of the Cemetery Care | 12 | | Act, whether the records shall be transferred, copied, or left | 13 | | with the Comptroller; until this determination has been made | 14 | | the transfer shall not occur . | 15 | | (b) (Blank). A person licensed under one of the Acts listed | 16 | | in subsection (a) of this Section or regulated under the | 17 | | Cemetery Association Act shall continue to comply with the | 18 | | provisions of those Acts until such time as the person is | 19 | | licensed under this Act or those Acts are repealed or the | 20 | | amendatory changes made by this amendatory Act of the 96th | 21 | | General Assembly take effect, as the case may be, whichever is | 22 | | earlier. | 23 | | (c) To support the costs that may be associated with | 24 | | implementing and maintaining a licensure and regulatory | 25 | | process for the licensure and regulation of cemetery | 26 | | authorities, cemetery managers, customer service employees, |
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| 1 | | and cemetery workers, all cemetery authorities not maintaining | 2 | | a full exemption or partial exemption shall pay a one-time fee | 3 | | of $20 to the Department plus an additional charge of $1 per | 4 | | burial unit per year within the cemetery. The Department may | 5 | | establish forms for the collection of the fee established under | 6 | | this subsection and shall deposit such fee into the Cemetery | 7 | | Oversight Licensing and Disciplinary Fund. The Department may | 8 | | begin to collect the aforementioned fee after the effective | 9 | | date of this Act. In addition, the Department may establish | 10 | | rules for the collection process, which may include, but shall | 11 | | not be limited to, dates, forms, enforcement, or other | 12 | | procedures necessary for the effective collection, deposit, | 13 | | and
overall process regarding this Section. | 14 | | (d) Any cemetery authority that fails to pay to the | 15 | | Department the required fee or submits the incorrect amount | 16 | | shall be subject to the penalties provided for in Section | 17 | | 25-110 of this Act. | 18 | | (e) Except as otherwise specifically provided, all fees, | 19 | | fines, penalties, or other moneys received or collected | 20 | | pursuant to this Act shall be deposited in the Cemetery | 21 | | Oversight Licensing and Disciplinary Fund. | 22 | | (f) (Blank). All proportionate funds held in the | 23 | | Comptroller's Administrative Fund related to unexpended moneys | 24 | | collected under the Cemetery Care Act and the Crematory | 25 | | Regulation Act shall be transferred to the Cemetery Oversight | 26 | | Licensing and Disciplinary Fund within 60 days after the |
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| 1 | | effective date of the repeal of the Cemetery Care Act. | 2 | | (g) (Blank). Personnel employed by the Comptroller on | 3 | | February 29, 2012, to perform the duties pertaining to the | 4 | | administration of the Cemetery Care Act and the Crematory | 5 | | Regulation Act, are transferred to the Department on March 1, | 6 | | 2012. | 7 | | The rights of State employees, the State, and its agencies | 8 | | under the Comptroller Merit Employment Code and applicable | 9 | | collective bargaining agreements and retirement plans are not | 10 | | affected under this Act, except that all positions transferred | 11 | | to the Department shall be subject to the Personnel Code | 12 | | effective March 1, 2012. | 13 | | All transferred employees who are members of collective | 14 | | bargaining units shall retain their seniority, continuous | 15 | | service, salary, and accrued benefits. During the pendency of | 16 | | the existing collective bargaining agreement, the rights | 17 | | provided for under that agreement shall not be abridged. | 18 | | The Department shall continue to honor during their | 19 | | pendency all bargaining agreements in effect at the time of the | 20 | | transfer and to recognize all collective bargaining | 21 | | representatives for the employees who perform or will perform | 22 | | functions transferred by this Act. For all purposes with | 23 | | respect to the management of the existing agreement and the | 24 | | negotiation and management of any successor agreements, the | 25 | | Department shall be deemed the employer of employees who | 26 | | perform or will perform functions transferred to the Department |
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| 1 | | by this Act.
| 2 | | (Source: P.A. 96-863, eff. 3-1-10.) | 3 | | Section 15. The Illinois Pre-Need Cemetery Sales Act is | 4 | | amended by changing Sections 6, 8, 14, 15, and 20 as follows:
| 5 | | (815 ILCS 390/6) (from Ch. 21, par. 206)
| 6 | | Sec. 6. License application.
| 7 | | (a) An application for a license shall be made in writing | 8 | | to
the Comptroller on forms prescribed by him or her, signed by | 9 | | the applicant
under oath verified by a notary public,
and | 10 | | accompanied
by a non-returnable $125 $25 application fee , $100 | 11 | | of which shall be deposited into the Comptroller's | 12 | | Administrative Fund . The Comptroller may prescribe
abbreviated | 13 | | application forms for persons holding a license under the | 14 | | Cemetery
Care Act. Applications (except abbreviated | 15 | | applications) must include at least
the following information:
| 16 | | (1) The full name and address, both residence and | 17 | | business, of the
applicant if the applicant is an | 18 | | individual; of every member if applicant is
a partnership; | 19 | | of every member of the Board of Directors if applicant is | 20 | | an
association; and of every officer, director and | 21 | | shareholder
holding more
than 10% of the corporate stock if | 22 | | applicant is a corporation;
| 23 | | (2) A detailed statement of applicant's assets and | 24 | | liabilities;
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| 1 | | (2.1) The name and address of the applicant's
principal | 2 | | place of business at which the books,
accounts, and records | 3 | | are available for examination
by the Comptroller as | 4 | | required by this Act;
| 5 | | (2.2) The name and address of the applicant's branch
| 6 | | locations at which pre-need sales will be conducted and
| 7 | | which will operate under the same license number as the
| 8 | | applicant's principal place of business;
| 9 | | (3) For each individual listed under (1) above, a | 10 | | detailed statement of
the individual's business experience | 11 | | for the 10 years immediately preceding
the application; any | 12 | | present or prior connection between the individual and
any | 13 | | other person engaged in pre-need sales; any felony or | 14 | | misdemeanor
convictions for which fraud was an essential | 15 | | element; any charges or
complaints lodged against the | 16 | | individual for which fraud was an essential
element and | 17 | | which resulted in civil or criminal litigation; any failure | 18 | | of
the individual to satisfy an enforceable judgment | 19 | | entered against him or
her based
upon fraud;
and any other | 20 | | information requested by the Comptroller relating
to the | 21 | | past business practices of the individual. Since the | 22 | | information
required by this paragraph may be confidential | 23 | | or contain proprietary
information, this information shall | 24 | | not be available to other licensees or
the general public | 25 | | and shall be used only for the lawful purposes of the
| 26 | | Comptroller in enforcing this Act;
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| 1 | | (4) The name of the trustee and, if applicable, the | 2 | | names of the
advisors to the trustee, including a copy of | 3 | | the proposed trust agreement
under which the trust funds | 4 | | are to be held as required by this Act;
| 5 | | (5) Where applicable, the name of the corporate surety | 6 | | company
providing the performance bond for the | 7 | | construction of undeveloped spaces
and a copy of the bond; | 8 | | and
| 9 | | (6) Such other information as the Comptroller may | 10 | | reasonably require in
order to determine the qualification | 11 | | of the applicant to be licensed under this
Act.
| 12 | | (b) Applications for license shall be accompanied by a | 13 | | fidelity bond
executed by the applicant and a security company | 14 | | authorized to do business
in this State in such amount, not | 15 | | exceeding $10,000, as the Comptroller may
require. The | 16 | | Comptroller may require additional bond from time to time in
| 17 | | amounts equal to one-tenth of such trust funds but not to | 18 | | exceed $100,000,
which bond shall run to the Comptroller for | 19 | | the use and benefit of the
beneficiaries of such trust funds. | 20 | | Such licensee may by written permit of
the Comptroller be | 21 | | authorized to operate without additional bond, except
such | 22 | | fidelity bond as may be required by the Comptroller for the | 23 | | protection
of the licensee against loss by default by any of | 24 | | its employees engaged in
the handling of trust funds.
| 25 | | (c) Any application not acted upon within 90 days may be | 26 | | deemed denied.
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| 1 | | (Source: P.A. 92-419, eff. 1-1-02.)
| 2 | | (815 ILCS 390/8) (from Ch. 21, par. 208)
| 3 | | Sec. 8.
(a) Every license issued by the Comptroller shall | 4 | | state the
number of the license, the business name and address | 5 | | of the licensee's
principal place of business, each branch | 6 | | location also operating under the
license, and the licensee's | 7 | | parent company, if any. The license shall be
conspicuously | 8 | | posted in
each place of business operating under the license. | 9 | | The Comptroller may issue
additional licenses as may be | 10 | | necessary for license branch locations upon compliance with the | 11 | | provisions of this Act
governing an original issuance of a | 12 | | license for each new license.
| 13 | | (b) Individual salespersons representing a licensee
shall | 14 | | not be required
to obtain licenses in their individual | 15 | | capacities
but must acknowledge, by affidavit, that they have
| 16 | | been provided a copy of and have read this Act. The licensee | 17 | | must
retain copies of the affidavits of its salespersons for | 18 | | its
records and must make the affidavits available to the
| 19 | | Comptroller for examination upon request.
| 20 | | (c) The licensee shall be responsible for the activities of | 21 | | any person
representing the licensee in selling or offering a | 22 | | pre-need contract for sale.
| 23 | | (d) Any person not selling on behalf of a
licensee
shall be | 24 | | required to obtain his or her own license.
| 25 | | (e) Any person engaged in pre-need sales, as defined |
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| 1 | | herein, prior to
the effective date of this Act may continue | 2 | | operations until the application
for license under this Act is | 3 | | denied; provided that such person shall make
application for a | 4 | | license within 60 days of the date that application forms
are | 5 | | made available by the Comptroller.
| 6 | | (f) No license shall be transferable or assignable without | 7 | | the express
written consent of the Comptroller. A transfer of | 8 | | more than 50% of the
ownership of any business licensed | 9 | | hereunder shall be deemed to be an attempted
assignment of the | 10 | | license originally issued to the licensee for which consent
of | 11 | | the Comptroller shall be required.
| 12 | | (g) Every license issued hereunder shall be renewed every 5 | 13 | | years for a fee of $100. The renewal fee shall be deposited | 14 | | into the Comptroller's Administrative Fund. The remain in force | 15 | | until the same
has been suspended, surrendered or revoked in | 16 | | accordance with this Act,
but the Comptroller, upon the request | 17 | | of an interested person or on his
own motion, may issue new | 18 | | licenses to a licensee whose license or licenses
have been | 19 | | revoked, if no factor or condition then exists which would have
| 20 | | warranted the Comptroller in refusing originally the issuance | 21 | | of such license.
| 22 | | (Source: P.A. 92-419, eff. 1-1-02.)
| 23 | | (815 ILCS 390/14) (from Ch. 21, par. 214)
| 24 | | Sec. 14. Contract required.
| 25 | | (a) It is unlawful for any person doing business within |
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| 1 | | this
State to accept sales proceeds, either directly or | 2 | | indirectly, by any
means unless the seller enters into a | 3 | | pre-need sales
contract
with the
purchaser which meets the | 4 | | following requirements:
| 5 | | (1) A written sales contract shall be executed in at | 6 | | least 11 point
type in duplicate for
each pre-need sale | 7 | | made by a licensee, and a signed copy given to the
| 8 | | purchaser. Each completed contract shall be numbered and | 9 | | shall contain: (i)
the
name and address of the purchaser, | 10 | | the principal office
of the licensee, and the parent | 11 | | company of the licensee; (ii) the name
of the person,
if | 12 | | known, who
is to receive the cemetery merchandise, cemetery | 13 | | services or the
completed interment, entombment or | 14 | | inurnment spaces under the contract; and
(iii) specific | 15 | | identification of such
merchandise, services or spaces to | 16 | | be provided, if a specific space or spaces
are contracted | 17 | | for, and
the price of the merchandise, services, or space | 18 | | or spaces.
| 19 | | (2) In addition,
such contracts must contain a | 20 | | provision in distinguishing typeface as follows:
| 21 | | "Notwithstanding anything in this contract to the | 22 | | contrary, you are
afforded certain specific rights of | 23 | | cancellation and refund under the Illinois Pre-Need | 24 | | Cemetery Sales Act, enacted by the 84th
General Assembly of | 25 | | the State of Illinois".
| 26 | | (3) All pre-need sales contracts shall be sold on a |
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| 1 | | guaranteed price
basis.
At the time of performance of the | 2 | | service or delivery of the merchandise,
the seller shall be | 3 | | prohibited from assessing the purchaser or
his heirs or
| 4 | | assigns or duly authorized representative any additional | 5 | | charges for the
specific merchandise and services listed on | 6 | | the pre-need sales contract.
| 7 | | (4) Each contract shall clearly disclose that the price | 8 | | of the
merchandise or services is guaranteed and shall | 9 | | contain the following
statement in 12 point bold type:
| 10 | | "THIS CONTRACT GUARANTEES THE BENEFICIARY THE SPECIFIC | 11 | | GOODS,
SERVICES, INTERMENT SPACES, ENTOMBMENT SPACES, AND | 12 | | INURNMENT SPACES
CONTRACTED FOR. NO ADDITIONAL CHARGES MAY | 13 | | BE REQUIRED FOR
DESIGNATED GOODS, SERVICES, AND SPACES. | 14 | | ADDITIONAL CHARGES MAY
BE INCURRED FOR
UNEXPECTED | 15 | | EXPENSES."
| 16 | | (5) The pre-need sales contract shall provide that
if | 17 | | the particular cemetery services, cemetery
merchandise, or | 18 | | spaces specified in the pre-need
contract are unavailable | 19 | | at the time of delivery, the
seller shall be required to | 20 | | furnish services,
merchandise, and spaces similar in style | 21 | | and at least
equal in quality of material and workmanship.
| 22 | | (6) The pre-need contract shall also disclose any
| 23 | | specific penalties to be incurred by the purchaser as a
| 24 | | result of failure to make payments; and penalties to be
| 25 | | incurred or moneys or refunds to be received as a result
of | 26 | | cancellation of the contract.
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| 1 | | (7) The pre-need contract shall disclose the nature
of | 2 | | the relationship between the provider and the seller.
| 3 | | (8) Each pre-need contract that authorizes the | 4 | | delivery
of cemetery merchandise to a licensed and bonded | 5 | | warehouse
shall provide that prior to or upon delivery of | 6 | | the
merchandise to the warehouse
the title to the | 7 | | merchandise and a warehouse receipt shall
be delivered to | 8 | | the purchaser or beneficiary. The pre-need
contract shall | 9 | | contain the following statement in 12 point
bold type:
| 10 | | "THIS CONTRACT AUTHORIZES THE DELIVERY OF MERCHANDISE TO
A | 11 | | LICENSED AND BONDED WAREHOUSE FOR STORAGE OF THE
| 12 | | MERCHANDISE UNTIL THE MERCHANDISE IS NEEDED BY THE
| 13 | | BENEFICIARY. DELIVERY OF THE MERCHANDISE IN THIS MANNER MAY
| 14 | | PRECLUDE REFUND OF SALE PROCEEDS THAT ARE ATTRIBUTABLE TO
| 15 | | THE DELIVERED MERCHANDISE."
| 16 | | The purchaser shall initial the statement at the time | 17 | | of
entry into the pre-need contract.
| 18 | | (9) Each pre-need contract that authorizes the | 19 | | placement
of cemetery merchandise at the site of its
| 20 | | ultimate use prior to the time that the merchandise is | 21 | | needed
by the beneficiary shall contain the following | 22 | | statement in
12 point bold type:
| 23 | | "THIS CONTRACT AUTHORIZES THE PLACEMENT OF MERCHANDISE
AT | 24 | | THE SITE OF ITS ULTIMATE USE PRIOR TO THE TIME THAT THE
| 25 | | MERCHANDISE IS NEEDED BY THE BENEFICIARY. DELIVERY OF THE
| 26 | | MERCHANDISE IN THIS MANNER MAY PRECLUDE REFUND OF SALE
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| 1 | | PROCEEDS THAT ARE ATTRIBUTABLE TO THE DELIVERED
| 2 | | MERCHANDISE."
| 3 | | The purchaser shall initial the statement at the time | 4 | | of
entry into the pre-need contract.
| 5 | | (10) Each pre-need contract that is funded by a trust | 6 | | shall clearly identify the trustee's name and address and | 7 | | the primary state or federal regulator of the trustee as a | 8 | | corporate fiduciary. | 9 | | (b) Every pre-need sales contract must be in writing.
The | 10 | | Comptroller may by rule
develop a model pre-need sales contract | 11 | | form that meets the requirements
of this Act.
| 12 | | (c) To the extent the Rule is applicable, every pre-need | 13 | | sales
contract is subject to the Federal Trade Commission Rule | 14 | | concerning the
Cooling-Off Period for Door-to-Door Sales (16 | 15 | | CFR Part 429).
| 16 | | (d) No pre-need sales contract may be entered into in
this | 17 | | State unless there is a provider for the cemetery
merchandise, | 18 | | cemetery services, and undeveloped interment,
inurnment, and | 19 | | entombment spaces being sold. If the seller
is not the | 20 | | provider, then the seller must have a binding
agreement with a | 21 | | provider, and the identity of the provider
and the nature of | 22 | | the agreement between the seller and the
provider must be | 23 | | disclosed in the pre-need sales contract
at the time of sale | 24 | | and before the receipt of any sale
proceeds. The failure to | 25 | | disclose the identity of the
provider, the nature of the | 26 | | agreement between the seller
and the provider, or any changes |
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| 1 | | thereto to the purchaser
and beneficiary, or the failure to | 2 | | make the disclosures
required by this Section constitutes an | 3 | | intentional
violation of this Act.
| 4 | | (e) No pre-need contract may be entered into in this
State | 5 | | unless it is accompanied by a funding mechanism
permitted under | 6 | | this Act and unless the seller is
licensed by the Comptroller | 7 | | as provided in this Act.
Nothing in this Act is intended to | 8 | | relieve providers or
sellers of pre-need contracts from being | 9 | | licensed under any
other Act required for their profession or | 10 | | business or from
being subject to the rules promulgated to | 11 | | regulate their
profession or business, including rules on | 12 | | solicitation and
advertisement.
| 13 | | (f) No pre-need contract may be entered into in this
State | 14 | | unless the seller explains to the
purchaser the terms of the | 15 | | pre-need contract prior to the
purchaser signing and the | 16 | | purchaser initials a statement in the contract
confirming that | 17 | | the seller has explained the terms of the contract prior to the
| 18 | | purchaser signing.
| 19 | | (g) The State Comptroller shall develop a booklet for
| 20 | | consumers in plain English describing the scope,
application, | 21 | | and consumer protections of this Act. After
the booklet is | 22 | | developed, no pre-need contract may be
sold in this State | 23 | | unless the seller
distributes to the purchaser prior to the | 24 | | sale a booklet
developed or approved for use by the State | 25 | | Comptroller.
| 26 | | (h) Each pre-need contract entered into under this Section |
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| 1 | | shall be registered on an online database maintained by the | 2 | | State Comptroller. Information to be included in the database | 3 | | shall include, but not be limited to, the name of licensee, | 4 | | purchaser, date of contract, amount of contract, and | 5 | | disposition of the funds. This information must be registered | 6 | | into the State Comptroller's online database within 45 days | 7 | | after the date of the pre-need contract. | 8 | | (Source: P.A. 96-879, eff. 2-2-10.)
| 9 | | (815 ILCS 390/15) (from Ch. 21, par. 215)
| 10 | | Sec. 15.
(a) Whenever a seller receives anything of value | 11 | | under a
pre-need sales contract, the person receiving such | 12 | | value shall deposit 50%
of all proceeds received into one or | 13 | | more trust funds maintained pursuant
to this Section, except | 14 | | that, in the case of proceeds received for the
purchase of | 15 | | outer burial containers, 85% of the proceeds shall be deposited
| 16 | | into one or more trust funds. Such deposits shall be made until | 17 | | the amount
deposited in
trust equals 50% of the sales price of | 18 | | the cemetery merchandise, cemetery
services and undeveloped | 19 | | spaces included in such contract, except that, in
the case of | 20 | | deposits for outer burial containers, deposits shall be made | 21 | | until
the amount deposited in trust equals 85% of the sales | 22 | | price. In the event
an
installment contract is factored, | 23 | | discounted or sold to a third party, the
seller shall deposit | 24 | | an amount equal to 50% of the sales price of the
installment | 25 | | contract, except that, for the portion of the contract
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| 1 | | attributable to the sale of outer burial containers, the seller | 2 | | shall deposit
an amount equal to 85% of the sales price. | 3 | | Proceeds required to be deposited
in trust which
are
| 4 | | attributable to cemetery merchandise and cemetery services | 5 | | shall be held
in a "Cemetery Merchandise Trust Fund". Proceeds | 6 | | required to be deposited
in trust which are attributable to the | 7 | | sale of undeveloped interment,
entombment or inurnment spaces | 8 | | shall be held in a "Pre-construction Trust
Fund". If | 9 | | merchandise is delivered for storage in a bonded warehouse, as
| 10 | | authorized herein, and payment of transportation or other | 11 | | charges totaling
more than $20 will be required in order to | 12 | | secure delivery to the site of
ultimate use, upon such delivery | 13 | | to the warehouse the seller shall deposit
to the trust fund the | 14 | | full amount of the actual or estimated transportation
charge. | 15 | | Transportation charges which have been prepaid by the seller
| 16 | | shall not be deposited to trust funds maintained pursuant to | 17 | | this Section.
As used in this Section, "all proceeds" means the | 18 | | entire amount paid by a
purchaser in connection with a pre-need | 19 | | sales contract, including finance
charges and Cemetery Care Act | 20 | | contributions, but excluding sales taxes
and credit life | 21 | | insurance premiums.
| 22 | | (b) The seller shall act as trustee of all amounts received | 23 | | for cemetery merchandise, services, or undeveloped spaces | 24 | | until those amounts have been deposited into the trust fund. | 25 | | All trust deposits required by this Act shall be made within 30 | 26 | | days
following the end of the month of receipt. The seller must |
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| 1 | | retain a corporate fiduciary as an independent trustee for any | 2 | | amount of trust funds. Upon 30 days' prior written notice from | 3 | | the seller to the Comptroller, the seller may change the | 4 | | trustee of the trust fund. Failure to provide the Comptroller | 5 | | with timely prior notice is an intentional violation of this | 6 | | Act.
| 7 | | (c) A trust established under this Act must be maintained | 8 | | with a corporate fiduciary as defined in Section 1-5.05 of the | 9 | | Corporate Fiduciary Act or with a foreign corporate fiduciary | 10 | | recognized by Article IV of the Corporate Fiduciary Act .
| 11 | | (d) Funds deposited in the trust account shall be | 12 | | identified in the records
of the seller by the name of the | 13 | | purchaser. Nothing shall prevent the trustee
from commingling | 14 | | the deposits in any such trust fund for purposes of the
| 15 | | management thereof and the investment of funds therein as | 16 | | provided in the
"Common Trust Fund Act", approved June 24, | 17 | | 1949, as amended. In addition,
multiple trust funds maintained | 18 | | pursuant to this Act may be commingled or
commingled with other | 19 | | funeral or burial related trust funds, provided that
all record | 20 | | keeping requirements imposed by or pursuant to law are met.
| 21 | | (e) In lieu of a pre-construction trust fund, a seller of | 22 | | undeveloped
interment, entombment or inurnment spaces may | 23 | | obtain and file with the
Comptroller a performance bond in an | 24 | | amount at least equal to 50% of the
sales price of the | 25 | | undeveloped spaces or the estimated cost of completing
| 26 | | construction, whichever is greater. The bond shall be |
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| 1 | | conditioned on the
satisfactory construction and completion of | 2 | | the undeveloped spaces as
required in Section 19 of this Act.
| 3 | | Each bond obtained under this Section shall have as surety | 4 | | thereon a
corporate surety company incorporated under the laws | 5 | | of the United States,
or a State, the District of Columbia or a | 6 | | territory or possession of the
United States. Each such | 7 | | corporate surety company must be authorized to
provide | 8 | | performance bonds as required by this Section, have paid-up
| 9 | | capital of at least $250,000 in cash or its equivalent and be | 10 | | able to carry
out its contracts. Each pre-need seller must | 11 | | provide to the Comptroller,
for each corporate surety company | 12 | | such
seller utilizes, a statement of assets and liabilities of | 13 | | the corporate
surety company sworn to by the president and | 14 | | secretary
of the corporation by January 1 of each year.
| 15 | | The Comptroller shall prohibit pre-need sellers from doing | 16 | | new business
with a corporate surety company if the company is | 17 | | insolvent or is in
violation of this Section. In addition the | 18 | | Comptroller may direct a
pre-need seller to reinstate a | 19 | | pre-construction trust fund upon the
Comptroller's | 20 | | determination that the corporate surety company no longer is
| 21 | | sufficient security.
| 22 | | All performance bonds issued pursuant to this Section must | 23 | | be irrevocable
during the statutory term for completing | 24 | | construction specified in Section
19 of this Act, unless | 25 | | terminated sooner by the completion of construction.
| 26 | | (f) Whenever any pre-need contract shall be entered into |
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| 1 | | and include 1)
items of cemetery merchandise and cemetery | 2 | | services, and 2) rights to
interment, inurnment or entombment | 3 | | in completed spaces without allocation
of the gross sale price | 4 | | among the items sold, the application of payments
received | 5 | | under the contract shall be allocated, first to the right to
| 6 | | interment, inurnment or entombment, second to items of cemetery | 7 | | merchandise
and cemetery services, unless some other | 8 | | allocation is clearly provided
in the contract.
| 9 | | (g) Any person engaging in pre-need sales who enters into a | 10 | | combination
sale which involves the sale of items covered by a | 11 | | trust or performance
bond requirement and any item not covered | 12 | | by any entrustment or bond
requirement, shall be prohibited | 13 | | from increasing the gross sales price of
those items not | 14 | | requiring entrustment with the purpose of allocating a
lesser | 15 | | gross sales price to items which require a trust deposit or a
| 16 | | performance bond.
| 17 | | (Source: P.A. 96-879, eff. 2-2-10.)
| 18 | | (815 ILCS 390/20) (from Ch. 21, par. 220)
| 19 | | Sec. 20. Records.
| 20 | | (a) Each licensee must keep accurate accounts, books and
| 21 | | records in this State
at the principal place of business | 22 | | identified in the
licensee's license application or as | 23 | | otherwise approved by
the Comptroller in writing
of all | 24 | | transactions, copies of agreements, dates and
amounts of | 25 | | payments made or received, the names and addresses of the
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| 1 | | contracting parties, the names and addresses of persons for | 2 | | whose benefit
funds are received, if known, and the names of | 3 | | the trust depositories.
Additionally, for a period not to | 4 | | exceed 6 months after
the performance of all terms in a | 5 | | pre-need sales contract,
the licensee shall maintain copies of | 6 | | each pre-need
contract at the licensee branch location where | 7 | | the contract
was entered or at some other location agreed to by | 8 | | the Comptroller in
writing.
| 9 | | (b) Each licensee must maintain such records for a period | 10 | | of 3
years
after the licensee shall have fulfilled his or her | 11 | | obligation
under the pre-need
contract or 3 years after any | 12 | | stored merchandise shall have been provided
to the purchaser or | 13 | | beneficiary, whichever is later.
| 14 | | (c) Each licensee shall submit reports to the Comptroller
| 15 | | annually,
under oath, on forms furnished by the Comptroller. | 16 | | The annual report
shall
contain, but shall not be limited to, | 17 | | the following:
| 18 | | (1) An accounting of the principal deposit and | 19 | | additions of principal
during the fiscal year.
| 20 | | (2) An accounting of any withdrawal of principal or | 21 | | earnings.
| 22 | | (3) An accounting at the end of each fiscal year, of | 23 | | the total amount of
principal and earnings held.
| 24 | | (d) The annual report shall be filed by the licensee with | 25 | | the
Comptroller within 75 days after the end of the licensee's | 26 | | fiscal year. An
extension of up to 60 days may be granted by |
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| 1 | | the Comptroller, upon a
showing of need by the licensee. Any | 2 | | other reports shall be in
the form
furnished or specified by | 3 | | the Comptroller. If a licensee fails to submit an
annual report | 4 | | to the Comptroller within the time specified in this Section, | 5 | | the
Comptroller shall impose upon the licensee a penalty of $5 | 6 | | per day for the first 15 days past due, $10 per day for 16 | 7 | | through 30 days past due, $15 per day for 31 through 45 days | 8 | | past due, and $20 per day for the 46th day and every day | 9 | | thereafter for
each and every
day the licensee remains | 10 | | delinquent in submitting the annual report. The
Comptroller may | 11 | | abate all or part of the $5 daily penalty for good cause
shown. | 12 | | Each
report shall be accompanied by a check or money order in | 13 | | the
amount of $10
payable to: Comptroller, State of Illinois.
| 14 | | (e) On and after the effective date of this amendatory Act | 15 | | of the 91st
General Assembly, a licensee may
report all | 16 | | required information concerning the sale of outer burial | 17 | | containers
on the licensee's annual report required to be filed | 18 | | under this Act and
shall
not be required to report that | 19 | | information under the Illinois Funeral or
Burial
Funds Act, as | 20 | | long as the information is reported under this Act.
| 21 | | (Source: P.A. 91-7, eff. 1-1-00; 92-419, eff. 1-1-02.)
| 22 | | Section 99. Effective date. This Act takes effect upon | 23 | | becoming law. |
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