On April 7, the Virginia governor signed HB 1553, which outlines licensing and regulatory requirements for debt settlement services providers. Among other things, HB 1553 specifies that all debt settlement services providers must be licensed by the state, must file a bond with the state commissioner, and must comply with outlined record retention, reporting, and examination requirements. HB 1553 also outlines prohibited conduct, including prohibiting licensees from accepting a fee from a consumer prior to providing the requested debt settlement service, or from using false, misleading, or deceptive advertisements in connection with the offered services. HB 1553 also provides for cease and desist orders and civil penalties to be issued against licensees that violate these requirements, grants consumers a private right of action against licensees, and makes a violation a prohibited practice under the Virginia Consumer Protection Act. Additionally, the State Corporation Commission is directed to “establish a procedure, to be in effect by March 1, 2021, for any person to apply, prior to July 1, 2021, for a license” that will take effect when HB 1553’s requirements become effective on July 1, 2021.
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