                                 CODE OF VIRGINIA

REQUIRED AND PROHIBITED BUSINESS METHODS (§ 6.2-2014)

Each licensee shall comply with the following requirements:

1. Each DMP shall be evidenced by an agreement, which shall be maintained in
either a hard copy, including a faxed copy, or electronic version and which
shall be signed by the consumer and a person authorized by the licensee to sign
such agreements and dated the same day the DMP is executed by the consumer. The
agreement may be signed by the parties either originally or by electronic
signature. The agreement shall set forth, at a minimum: (i) the name and address
of both the consumer and the licensee; (ii) a full description of all services
to be performed for the consumer by the licensee; (iii) a clear explanation,
highlighted in bold type, of the costs to the consumer; (iv) a statement that
the DMP agreement can be terminated for any reason by the consumer and that the
consumer has no obligation to continue the arrangement unless satisfied with the
services provided; (v) a statement that in the event of termination of the
agreement, the consumer shall be entitled to a refund of all funds that have not
been disbursed to creditors and either (a) all fees paid if terminated within
five days of the date the DMP agreement is executed by the consumer or (b) all
fees paid less the set-up fee if terminated more than five but less than 31 days
after execution by the consumer; (vi) an explanation of the method of dispute
resolution under the agreement; (vii) an explanation of the obligations of the
consumer and the licensee that are subject to the agreement; (viii) notification
of privacy policies in compliance with state and federal laws and regulations;
and (ix) a statement that participating in a DMP may have a derogatory effect
upon the consumer&#8217;s credit report;

2. A licensee shall give to the consumer a duplicate original of the agreement
executed by the consumer and licensee upon full execution;

3. At the time of execution of the DMP, a licensee shall have a good faith
belief that the creditors listed in the DMP will participate in the DMP. A
licensee shall advise the consumer of any changes by a creditor in accepting
payments under the DMP promptly upon learning of such changes;

4. A licensee shall provide a consumer enrolled in a DMP with periodic
statements, no less often than quarterly, accounting for the funds received from
the consumer for payments to the consumer&#8217;s creditors and disbursements
made to each such creditor on the consumer&#8217;s behalf since the last report;

5. A licensee shall not purchase any debt or obligation of a consumer;

6. A licensee shall not lend money or provide credit to any consumer;

7. A licensee shall not obtain a mortgage or any other security interest in the
property of a consumer;

8. A licensee shall not operate as a debt collector;

9. A licensee shall not structure an agreement for the consumer that, at the
conclusion of the DMP, would knowingly result in negative amortization of any of
the consumer&#8217;s obligations to creditors;

10. A licensee shall not give legal advice to a consumer or perform legal
services on behalf of a consumer;

11. A licensee shall have an established practice of disbursing to creditors
funds received from a consumer under a DMP within eight business days of receipt
and shall provide consumers its disbursement practices in writing, including any
circumstances that would establish an exception to the eight-day practice;

12. A licensee shall maintain appropriate safeguards against conflicts of
interest in the conduct of its DMP activities;

13. A licensee shall not employ any person who is employed at the same time by a
creditor or collection agency;

14. A licensee shall keep (i) its operating funds separate from the funds
entrusted to the licensee by consumers for disbursement to creditors and (ii)
consumers&#8217; funds in a trust account, held in the name of the licensee by
an insured depository institution;

15. A licensee shall upon request give a consumer signed, dated receipts for
funds received from a consumer under a DMP, or provide a means whereby the
consumer may view the status of his account electronically; and

16. A licensee shall not obtain any agreement from a consumer (i) giving the
licensee or any third person power of attorney or authority to confess judgment
for the consumer; (ii) authorizing the licensee or any third party to bring suit
against the consumer in a court outside the Commonwealth; or (iii) waiving any
right the consumer has under this chapter.

HISTORY: 2004, c. 790, § 6.1-363.16; 2010, c. 794.