Title 808 | Chapter 009 | Regulation 010
808 KAR 9:010REG
A proposed version of this document exists.
808 KAR 9:010.Deferred deposit database compliance.
Section 1.
Definitions. The following shall be additional definitions of "closed" or "close" under KRS 286.9-010(6)(e):(1)
The customer's payment instrument was unpaid and the licensee has sold the underlying debt to a non-affiliated third party without recourse;(2)
The underlying debt represented by the customer's payment instrument has been discharged in bankruptcy;(3)
The database provider has designated the deferred deposit transaction concerning the customer's payment instrument as closed pursuant to KRS 286.9-140(7); or(4)
The licensee has reported to the database provider that the deferred deposit transaction concerning the customer's payment instrument is closed following being held open pursuant to KRS 286.9-140(7).Section 2.
Deferred Deposit Database Requirements.(1)
A licensee shall institute procedures and maintain an accounting system designed to:(a)
Prevent the licensee from entering into transactions with a customer in violation of KRS 286.9-100(9), including procedures for:1.
Maintaining a record of all current transactions with the licensee; and2.
Checking the record of current transactions with the database prior to issuance of a new transaction; and(b)
Generate reports that will readily permit examination and verification of compliance with KRS 286.9-100(9), KRS 286.9-140, and this section by department examiners.(2)
For each deferred deposit transaction, a licensee shall submit:(a)
The customer's date of birth;(b)
The check number of the payment instrument;(c)
The database verification fee charged to the customer, if any;(d)
The service fee charged to the customer; and(e)
The date the payment instrument was deposited or otherwise presented for payment.(3)
A licensee shall not cause a closed deferred deposit transaction to be reopened in the database unless:(a)
The deferred deposit transaction was closed by reason of clerical error by the licensee;(b)
The licensee causes the deferred deposit transaction to be reopened on or before the close of business on the business day after the transaction was closed; and(c)
Reopening the transaction would not cause the consumer to exceed the transaction limits set forth in KRS 286.9-100(9).(4)
A licensee shall not accept, collect, or seek payment on a deferred deposit transaction that is designated as closed in the database.(5)
A licensee that has reported to the database provider that a deferred deposit transaction is open beyond the maturity date pursuant to KRS 286.9-140(7) shall immediately notify the database provider when the transaction becomes closed.(6)
A new licensee or an existing licensee applying for an additional location shall establish an account with the database provider for each location prior to the time of application.HISTORY: (27 Ky.R. 1707; Am. 2788; eff. 4-9-2001; TAm eff. 5-2-2007; 41 Ky.R. 2634; 42 Ky.R. 686; eff. 9-22-2015; 45 Ky.R. 2220; eff. 5-3-2019.)
808 KAR 9:010.Deferred deposit database compliance.
Section 1.
Definitions. The following shall be additional definitions of "closed" or "close" under KRS 286.9-010(6)(e):(1)
The customer's payment instrument was unpaid and the licensee has sold the underlying debt to a non-affiliated third party without recourse;(2)
The underlying debt represented by the customer's payment instrument has been discharged in bankruptcy;(3)
The database provider has designated the deferred deposit transaction concerning the customer's payment instrument as closed pursuant to KRS 286.9-140(7); or(4)
The licensee has reported to the database provider that the deferred deposit transaction concerning the customer's payment instrument is closed following being held open pursuant to KRS 286.9-140(7).Section 2.
Deferred Deposit Database Requirements.(1)
A licensee shall institute procedures and maintain an accounting system designed to:(a)
Prevent the licensee from entering into transactions with a customer in violation of KRS 286.9-100(9), including procedures for:1.
Maintaining a record of all current transactions with the licensee; and2.
Checking the record of current transactions with the database prior to issuance of a new transaction; and(b)
Generate reports that will readily permit examination and verification of compliance with KRS 286.9-100(9), KRS 286.9-140, and this section by department examiners.(2)
For each deferred deposit transaction, a licensee shall submit:(a)
The customer's date of birth;(b)
The check number of the payment instrument;(c)
The database verification fee charged to the customer, if any;(d)
The service fee charged to the customer; and(e)
The date the payment instrument was deposited or otherwise presented for payment.(3)
A licensee shall not cause a closed deferred deposit transaction to be reopened in the database unless:(a)
The deferred deposit transaction was closed by reason of clerical error by the licensee;(b)
The licensee causes the deferred deposit transaction to be reopened on or before the close of business on the business day after the transaction was closed; and(c)
Reopening the transaction would not cause the consumer to exceed the transaction limits set forth in KRS 286.9-100(9).(4)
A licensee shall not accept, collect, or seek payment on a deferred deposit transaction that is designated as closed in the database.(5)
A licensee that has reported to the database provider that a deferred deposit transaction is open beyond the maturity date pursuant to KRS 286.9-140(7) shall immediately notify the database provider when the transaction becomes closed.(6)
A new licensee or an existing licensee applying for an additional location shall establish an account with the database provider for each location prior to the time of application.HISTORY: (27 Ky.R. 1707; Am. 2788; eff. 4-9-2001; TAm eff. 5-2-2007; 41 Ky.R. 2634; 42 Ky.R. 686; eff. 9-22-2015; 45 Ky.R. 2220; eff. 5-3-2019.)