10VAC5-200 Payday Lending

REGULATIONS

Vol. 28 Iss. 1 - September 12, 2011

TITLE 10. FINANCE AND FINANCIAL INSTITUTIONS

STATE CORPORATION COMMISSION

Chapter 200

Final Regulation

REGISTRAR'S NOTICE: The State Corporation Commission is exempt from the Administrative Process Act in accordance with § 2.2-4002 A 2 of the Code of Virginia, which exempts courts, any agency of the Supreme Court, and any agency that by the Constitution is expressly granted any of the powers of a court of record.

Title of Regulation: 10VAC5-200. Payday Lending (amending 10VAC5-200-90).

Statutory Authority: §§ 6.2-1814, 6.2-1815, and 12.1-13 of the Code of Virginia.

Effective Date: September 1, 2011.

Agency Contact: Gerald Fallen, Deputy Commissioner, Bureau of Financial Institutions, State Corporation Commission, P.O. Box 640, Richmond, VA 23218, telephone [phone], FAX [phone], or email [e-mail].

Summary:

The State Corporation Commission is amending 10VAC5-200-90, which prescribes the schedule of annual fees to be paid by payday lenders licensed under Chapter 18 (§ 6.2-1800 et seq.) of Title 6.2 of the Code of Virginia. The amendments increase the annual fee to $500 per office plus $ .47 per payday loan made by each licensee. The amendments also update references to the Code of Virginia.

AT RICHMOND, AUGUST 23, 2011

COMMONWEALTH OF VIRGINIA, ex rel.

STATE CORPORATION COMMISSION

CASE NO. BFI-2011-00085

Ex Parte: In re: annual fees paid
by licensed payday lenders

ORDER ADOPTING A REGULATION

On July 12, 2011, the State Corporation Commission ("Commission") entered an Order to Take Notice of a proposal by the Bureau of Financial Institutions ("Bureau") to amend 10 VAC 5-200-90, which prescribes the schedule of annual fees to be paid by licensed payday lenders ("licensees"). The Order and proposed regulation were published in the Virginia Register of Regulations on August 1, 2011, posted on the Commission's website, and mailed to all licensees and other interested parties. Licensees and other interested parties were afforded the opportunity to file written comments or request a hearing on or before August 15, 2011.

Comments on the proposed regulation were timely filed by RKZ Management, LLC, and the Community Financial Services Association of America.¹ The Commission did not receive any requests for a hearing.

NOW THE COMMISSION, having considered the proposed regulation, the comments filed, the record herein, and applicable law, concludes that the proposed increase in annual fees is necessary in order to recover the various costs incurred by the Bureau in examining, supervising, and regulating licensees and that the proposed regulation should be adopted. The Commission further concludes that the Bureau should continue to monitor whether the annual fees assessed pursuant to § 6.2-1814 A of the Code of Virginia and 10 VAC 5-200-90 remain offset by the total costs associated with examining, supervising, and regulating licensees.

Accordingly, IT IS ORDERED THAT:

(1) The proposed regulation, as attached hereto, is adopted effective September 1, 2011.

(2) This Order and the attached regulation shall be posted on the Commission's website at http://www.scc.virginia.gov/case.

(3) The Commission's Division of Information Resources shall send a copy of this Order, including a copy of the attached regulation, to the Virginia Registrar of Regulations for publication in the Virginia Register of Regulations.

(4) This case is dismissed from the Commission's docket of active cases.

AN ATTESTED COPY hereof, together with a copy of the attached regulation, shall be sent by the Clerk of the Commission to the Commission's Office of General Counsel and the Commissioner of Financial Institutions, who shall send a copy of this Order and the attached regulation to all licensed payday lenders and other interested parties designated by the Bureau.

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¹ After the comment period deadline, a comment letter was filed by EXTOL Corporation, Inc. d/b/a QUICK CHECK: Cash Advance.

10VAC5-200-90. Schedule of annual fees for the examination, supervision, and regulation of payday lenders.

Pursuant to § 6.1-457 6.2-1814 of the Code of Virginia, the commission sets the following schedule of annual fees to be paid by payday lenders required to be licensed under Chapter 18 (§ 6.1-444 et seq.) of Title 6.1 (§ 6.2-1800 et seq.) of Title 6.2 of the Code of Virginia. Such fees are to defray the costs of the examination, supervision, and regulation of such lenders licensees by the Bureau of Financial Institutions bureau. The fees are related to the actual costs of the bureau, to the number of offices operated by the lenders licensees, to the volume of business of the lenders licensees, and to other factors relating to their supervision and regulation.

The annual fee shall be $300 $500 per office, authorized and opened, as of December 31, plus $.18 $ .47 per payday loan made by each licensee. The annual fee for each payday lender shall be computed on the basis of (i) the number of offices operated [ , ] authorized and opened [ , ] as of December 31 of the year preceding the year of the assessment, and (ii) the number of payday loans as defined in § 6.1-444 of the Code of Virginia made under Chapter 18 (§ 6.2-1800 et seq.) of Title 6.2 of the Code of Virginia during the calendar year preceding the year of the assessment.

Fees shall be assessed on or before September 15 for the current calendar year. By law the fee must The assessment shall be paid by licensees on or before October 15.

The annual report, due March 25 each year, of each licensee provides the basis for its assessment, (i.e., the number of offices and payday loans made). In cases where a license has been granted between January 1 and September 15 of the year of the assessment, the licensee shall pay $150 $250 per office, authorized and opened, as of September 15 of that year.

Fees prescribed and assessed by pursuant to this schedule are apart from, and do not include, the reimbursement for expenses permitted authorized by subsection B of § 6.1-457 6.2-1814 of the Code of Virginia.

VA.R. Doc. No. R11-2918; Filed August 23, 2011, 4:09 p.m.