2023 Utah Code › Title 13 - Commerce and Trade › Chapter 26 - Telephone Fraud Prevention Act › Section 3 - Registration and bond required.

Effective 5/4/2022
13-26-3.
Registration and bond required.
(1)
(a) Unless exempt under Section 13-26-4, each seller shall register annually with the division before engaging in telephone solicitations if:
(i) the seller engages in telephone solicitations that:
(A) originate in Utah; or
(B) are received in Utah; or
(ii) the seller, or a solicitor on behalf of the seller, conducts any business operations in Utah.
(b) The registration form shall designate an agent residing in this state who is authorized by the seller to receive service of process in any action brought by this state or a resident of this state.
(c) If a seller fails to designate an agent to receive service or fails to appoint a successor to the agent, the division shall:
(i) deny the seller's application for an initial or renewal registration; and
(ii) if the application is for a renewal registration, suspend the seller's current registration until the seller designates an agent.
(d) For purposes of this section only, the registered agent of a seller shall provide the division the registered agent's proof of residency in the state in the form of:
(i) a valid Utah driver license;
(ii) a valid governmental photo identification issued to a resident of this state; or
(iii) other verifiable identification indicating residency in this state.
(2) The division may impose an annual registration fee set in accordance with Section 63J-1-504 that may include the cost of the criminal background check described in Subsection (4).
(3)
(a) Each seller subject to this chapter engaging in telephone solicitation or sales in this state shall obtain and maintain the following security:
(i) a performance bond issued by a surety authorized to transact surety business in this state;
(ii) an irrevocable letter of credit issued by a financial institution authorized under the laws of this state or the United States doing business in this state; or
(iii) a certificate of deposit held in this state in a financial institution authorized under the laws of this state or the United States to accept deposits from the public.
(b) A seller's bond, letter of credit, or certificate of deposit shall be payable to the division for the benefit of any consumer who incurs damages as the result of the seller's violation of this chapter.
(c) If the consumer has first recovered full damages, the division may recover from the bond, letter of credit, or certificate of deposit administrative fines, civil penalties, investigative costs, attorney fees, and other costs of collecting and distributing funds under this section.
(d) A seller shall keep a bond, certificate of deposit, or letter of credit in force for one year after the day on which the seller notifies the division in writing that the seller has ceased all activities regulated by this chapter.
(e) The seller shall post a bond, irrevocable letter of credit, or certificate of deposit in the amount of:
(i) $25,000 if:
(A) neither the seller nor any affiliated person has violated this chapter in the three-year period immediately before the day on which the seller files the application; and
(B) the seller has fewer than 10 employees;
(ii) $50,000 if:
(A) neither the seller nor any affiliated person has violated this chapter in the three-year period immediately before the day on which the seller files the application; and
(B) the seller has 10 or more employees; or
(iii) $75,000 if the seller or any affiliated person has violated this chapter in the three-year period immediately before the day on which the seller files the application.
(4) To register or renew a registration as a seller, a participant:
(a) may not have been convicted of a felony in the 10-year period immediately before the day on which the participant files the application;
(b) may not have been convicted of a misdemeanor involving moral turpitude, including theft, fraud, or dishonesty, in the 10-year period immediately before the day on which the participant files the application; and
(c) shall submit to the division:
(i) the participant's fingerprints, in a form acceptable to the division, for purposes of a criminal background check; and
(ii) consent to a criminal background check by the Bureau of Criminal Identification created in Section 53-10-201.
(5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the division may establish by rule the registration requirements for a seller.
(6) If information in an application for registration or for renewal of registration as a seller materially changes or becomes incorrect or incomplete, the applicant shall, within 30 days after the day on which information changes or becomes incorrect or incomplete, submit the correct information to the division in a manner that the division establishes by rule.
(7) The division director may deny or revoke a registration under this section for any violation of this chapter.
Amended by Chapter 324, 2022 General Session