Illinois Administrative Code › Title 38 - FINANCIAL INSTITUTIONS › Part 170 - CONSUMER LEGAL FUNDING ACT › Subpart A - GENERAL PROVISIONS › Section 170.20 - Definitions

Current through Register Vol. 48, No. 28, July 12, 2024
For purposes of this Part, the following definitions
				  apply:
"Act" means the Consumer Legal Funding Act [815 ILCS
				  121 ].
"Advertise" means publishing or disseminating any
				  written, electronic, or printed communication, or any communication by means of
				  recorded telephone messages or transmitted on radio, television, the Internet,
				  or similar communications media, including film strips, motion pictures, and
				  videos, published, disseminated, circulated, or placed before the public,
				  directly or indirectly, for the purpose of inducing a consumer to enter into a
				  consumer legal funding.
(Section 5 of the Act)
"Applicant" means a person or entity applying for a license
				  pursuant to the Act.
"Cancellation Date" means the Resolution Date or if there is
				  no Resolution Date, the date the licensee determines the consumer is not
				  required to repay the company the consumer legal funding amount or
				  charges.
"Charges" means the fees, as set forth in Section
				  25
of the Act,
to be paid to the consumer legal funding
				  company by or on behalf of the consumer above the funded amount provided by or
				  on behalf of the company to an Illinois consumer pursuant to the Act.
(Section 5 of the Act)
"Consumer" means a natural person who has a pending
				  legal claim and who resides or is domiciled in Illinois.
(Section 5 of
				  the Act)
"Consumer legal funding" or "funding" means a
				  nonrecourse transaction in which a company purchases and a consumer transfers
				  to the company an unvested, contingent future interest in the potential net
				  proceeds of a settlement or judgment obtained from the consumer's legal claim;
				  if no proceeds are obtained from the consumer's legal claim, the consumer is
				  not required to repay the company the consumer legal funding amount or
				  charges.
(Section 5 of the Act)
"Consumer legal funding company" or "company" means a
				  person or entity that enters into, purchases, or services a consumer legal
				  funding transaction with an Illinois consumer. "Consumer legal funding company"
				  does not include:
an immediate family member of the
				  consumer;
a bank, lender, financing entity, or other special
				  purpose entity:
that provides financing to a consumer legal funding
				  company; or
to which a consumer legal funding company grants a
				  security interest or transfers any rights or interest in a consumer legal
				  funding; or
an attorney or accountant who provides services to a
				  consumer.
(Section 5 of the Act)
"Controlling person" means
a person, entity, or ultimate equitable owner that owns or
				  controls, directly or indirectly, 10% or more of any class of stock of the
				  licensee or applicant;
a person, entity, or ultimate equitable owner that is not a
				  depository institution, as defined in Section
				  1007.50 of the Savings Bank Act,
				  that lends, provides, or infuses, directly or indirectly, in any way, funds to
				  or into a licensee or applicant in an amount equal to or more than 10% of the
				  license applicant's net worth;
a person, entity, or ultimate equitable owner that controls,
				  directly or indirectly, the election of 25% or more of the members of the board
				  of directors of a licensee or applicant; or
a person, entity, or ultimate equitable owner that the
				  Secretary finds influences management of the license or applicant, the
				  provisions of this subpart shall not apply to a public official serving on the
				  board of directors of a State guaranty agency.
"Department" means the Department of Financial and
				  Professional Regulation.
(Section 5 of the Act)
"Director" means the Director of the Department of Financial
				  and Professional Regulation - Division of Financial Institutions or the
				  Director's designee.
"Division" means the Department of Financial and Professional
				  Regulation - Division of Financial Institutions.
"Funded amount" means the amount of moneys provided
				  to, or on behalf of, the consumer in the consumer legal funding. "Funded
				  amount" does not include charges except for charges that are deducted from the
				  funded amount.
(Section 5 of the Act)
"Funding date" means the date on which the funded
				  amount is transferred to the consumer by the consumer legal funding company
				  either by
:
personal delivery;
via wire, ACH, or other electronic means;
				  or
mailed by insured, certified, or registered United
				  States mail.
(Section 5 of the Act)
"Immediate family member" means a parent; sibling;
				  child by blood, adoption, or marriage; spouse; grandparent; or
				  grandchild.
(Section 5 of the Act)
"Licensee" means a person, partnership, association, limited
				  liability company, corporation or other legal entity licensed under the Act.
				  Any person or entity who holds himself, herself, or itself out as a licensee or
				  who is accused of unlicensed practice is considered a licensee for purposes of
				  enforcement, investigation, hearings, and the Illinois Administrative Procedure
				  Act [5 ILCS
				  100 ].
"Net Proceeds" means the amount of proceeds of the consumer's
				  legal claim remaining after all liens of a higher priority on the consumer's
				  legal claim are paid.
"Other Business Authorization" means the authorization in
				  writing as required by Section 105 of the Act to conduct another business in a
				  location licensed under the Act.
"Resolution amount" means the funded amount plus the
				  agreed-upon charges that are delivered to the consumer legal funding company on
				  the resolution date.
(Section 5 of the Act)
"Resolution date" means the date the resolution
				  amount is delivered to the consumer legal funding company.
(Section 5
				  of the Act)
"Secretary" means the Secretary of Financial and
				  Professional Regulation or the Secretary's designee.
(Section 5 of the
				  Act)