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| [ Introduced ] | [ Engrossed ] | [ House Amendment 002 ] |
90_HB1113ham001
LRB9003071JSsbam
1 AMENDMENT TO HOUSE BILL 1113
2 AMENDMENT NO. . Amend House Bill 1113 by replacing
3 the title with the following:
4 "AN ACT to amend the Check Number Act by changing
5 Sections 1 and 5 and adding Sections 15, 20, 25, 30, 35, 36,
6 37, 38, 39, and 40."; and
7 by replacing everything after the enacting clause with the
8 following:
9 "Section 5. The Check Number Act is amended by changing
10 Sections 1 and 5 and adding Sections 15, 20, 25, 30, 35, 36,
11 37, 38, 39, and 40 as follows:
12 (205 ILCS 690/1)
13 Sec. 1. Short title. This Act may be cited as the Check
14 Printer and Check Number Act.
15 (Source: P.A. 87-1143.)
16 (205 ILCS 690/5)
17 Sec. 5. Definitions. For the purposes of this Act:
18 "Commissioner" means the Commissioner of Banks and Real
19 Estate.
20 "Consumer-deposit account" means a demand or other
21 similar deposit account such as a checking, negotiable order
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1 of withdrawal, money market, savings deposit, share, or
2 member account established and maintained by a natural person
3 with a financial institution and operated primarily for
4 personal, family, or household purposes.
5 "Financial institution" means any bank subject to the
6 Illinois Banking Act, any savings bank subject to the Savings
7 Bank Act, any savings and loan association subject to the
8 Illinois Savings and Loan Act of 1985, and any federally
9 chartered commercial bank, savings bank, or savings and loan
10 association organized and operated in this State under the
11 laws of the United States.
12 "Check" means a writing that complies with the
13 requirements of Section 3-104 of the Uniform Commercial Code.
14 "Material change" means any change or addition to any
15 part of a check drawn on a consumer-deposit account
16 pertaining to the account holder's name, address, city,
17 state, or account number.
18 "New order" means an order for checks to be drawn on a
19 new or existing consumer-deposit account which has not been
20 previously fulfilled by a financial institution or by a
21 person fulfilling a check order on behalf of a financial
22 institution or by a person selling or distributing checks
23 registered with the Commissioner under this amendatory Act of
24 1997.
25 "Reorder" means an order for checks to be drawn on an
26 existing consumer-deposit account for which a check order has
27 been previously fulfilled by the person selling or
28 distributing checks.
29 "Person" means any natural person or his legal
30 representative, partnership, corporation, company, trust,
31 business entity, or association.
32 "Verification" means that the financial institution
33 maintaining the consumer-deposit account on which the checks
34 will be drawn is contacted by the seller or distributor of
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1 the checks inquiring about the accuracy of a material change
2 or changes requested on any new order or reorder or that the
3 check seller or distributor has obtained acceptable
4 documentation from the person ordering the checks as provided
5 in Section 15.
6 (Source: P.A. 87-1143.)
7 (205 ILCS 690/15 new)
8 Sec 15. Verification of check purchasers.
9 (a) A person, other than a financial institution or a
10 person fulfilling check orders on behalf of a financial
11 institution or a person fulfilling check orders under an
12 existing contract, who sells or distributes checks that may
13 be drawn against funds held by a financial institution in a
14 consumer-deposit account shall, before delivery of checks
15 constituting (i) a new order or (ii) a reorder containing a
16 material change or changes, obtain documentation from the
17 person ordering the checks verifying the accuracy of that
18 person's account number, name, and address including city and
19 state. Acceptable forms of documentation under this
20 subsection (a) shall include a copy of the person's account
21 signature card from the financial institution, account
22 agreement with the financial institution, account statement
23 issued by the financial institution, letter or verbal
24 response from the financial institution verifying the account
25 information, or a copy of the signed Magnetic Ink Character
26 Recognition specification sheet from the financial
27 institution.
28 (b) A person, other than a financial institution or a
29 person fulfilling check orders on behalf of a financial
30 institution or a person fulfilling check orders under an
31 existing contract, who sells or distributes checks that may
32 be drawn against funds held by a financial institution in a
33 consumer-deposit account shall before delivery of checks
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1 constituting a reorder containing no material change, verify
2 the accuracy of the reorder by clearing the check written on
3 the same consumer-deposit account of the reorder presented
4 for payment for the reorder or obtaining an authorized credit
5 card transaction for payment for the reorder.
6 (c) The sale or distribution of checks by any person who
7 has not first obtained verification as required under this
8 Section shall constitute a business offense for which the
9 fine shall be $1,000 for each offense.
10 (205 ILCS 690/20 new)
11 Sec. 20. Registration. A person, other than a financial
12 institution or a person fulfilling check orders on behalf of
13 a financial institution or person fulfilling check orders
14 under an existing contract, who sells or distributes checks
15 that may be drawn against funds held by a financial
16 institution in a consumer-deposit account shall register with
17 the Commissioner no later than January 15, 1998 and every
18 January 15 thereafter or within 30 days after commencement of
19 doing business in this State. The person shall register on
20 forms provided by the Commissioner that require the name of
21 the business as incorporated, state, and date of
22 incorporation, address of the person's principal place of
23 business, telephone number, and name of the principal contact
24 of the registrant. If the principal contact changes for any
25 reason, it shall be the responsibility of the registrant to
26 notify the Commissioner.
27 (205 ILCS 690/25 new)
28 Sec. 25. Bond; conditions; amount. At the time of each
29 registration, the registrant shall file with, and have
30 approved by, the Commissioner a surety bond issued by a
31 bonding company authorized to do business in this State in
32 the principal sum of $10,000. The bond shall run to the
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1 Commissioner and shall be for any liability incurred by the
2 registrant for any violation of this Act, including damages
3 awarded in actions brought pursuant to Section 35.
4 From time to time, the Commissioner may determine the
5 amount of liabilities as described herein and may require the
6 registrant to file a bond in an additional sum if it is
7 determined to be necessary in accordance with the
8 requirements of this Section. In no case shall the bond be
9 less than the initial $10,000, nor more than the outstanding
10 liabilities if in excess of $10,000.
11 (205 ILCS 690/30 new)
12 Sec. 30. Civil action. When the Commissioner believes a
13 person has violated or is violating this Act or a rule
14 prescribed under this Act, the Commissioner may request the
15 Attorney General to bring a civil action in circuit court to
16 enjoin the violation or enforce compliance with this Act or a
17 rule prescribed under this Act. A person not complying with
18 an injunction issued under this Section is liable to the
19 State of Illinois is a civil suit for an amount of not more
20 than $10,000.
21 (205 ILCS 690/35 new)
22 Sec. 35. Recovery of damages. A person who is damaged
23 by reason of the registrant's failure to verify as required
24 under this Act may sue such person for damages including, at
25 a minimum, liquidated damages in the amount of $1,000, plus
26 all costs and expenses, including reasonable attorneys' fees,
27 incurred in the prosecution of the action.
28 (205 ILCS 690/36 new)
29 Sec. 36. Criminal penalties. A person who willfully and
30 knowingly subscribes to or makes, or causes to be made, any
31 false statement on the registration form with intent to
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1 deceive the Commissioner or his administrative officers
2 shall, upon conviction thereof, be guilty of a Class 3
3 felony.
4 (205 ILCS 690/37 new)
5 Sec. 37. Record retention. Records pertaining to or
6 constituting the procedures for and results of the
7 verification required under this Act shall be retained for a
8 period of 18 months from the date of receipt of the
9 information.
10 (205 ILCS 690/38 new)
11 Sec. 38. Rules. The Commissioner has the power to
12 promulgate reasonable rules for the purpose of administering
13 the provisions of this Act.
14 (205 ILCS 690/39 new)
15 Sec. 39. Severability. The provisions of this Act are
16 severable under Section 1.31 of the Statute on Statutes.
17 (205 ILCS 690/40 new)
18 Sec. 40. Conflicts. In the event of a conflict between
19 this Act and Article 3 of the Uniform Commercial Code,
20 Article 3 of the Uniform Commercial Code shall control.".