Illinois becomes the latest State to bring proper regulation to the Consumer Legal Funding industry with the signing of SB 1099.
The Alliance for Responsible Consumer Legal Funding, a major Trade Association for the companies that offer Consumer Legal Funding, were proud to work with Illinois Senator Jackie Collins and Representative Curtis Tarver in the drafting and passage of this bill. Additional sponsorship was offered by Senators John Collins, Mike Simmons, Mattie Hunter, and Ann Gillespie along with Representatives Elizabeth Hernandez and Jay Hoffman.
The legislation was also supported by the Woodstock Institute, the leading consumer advocate organization in Illinois.
SB 1099 brings some of the strongest consumer protections in the country involving Consumer Legal Funding.
It prohibits companies from:
- Paying or offering a commission or referral fee
- Accept a commission or referral fee
- Make false or misleading statements in advertising
- Make any decision in the consumers legal claim
- Knowingly pay or offer to pay court costs, filing fees or attorney fees
- Provide legal advice to the consumer regarding the funding or underlying legal claim
- Attorneys who represent the consumer are prohibited from having a financial interest in the funding company
It also mandates that companies that will offer this product must be registered with the Illinois Department of Financial and Professional Regulations and pass a background check and post a surety bond.
Illinois will be the first state that will require companies that offer Consumer Legal Funding to Illinois residents that they must make them aware of Financial Counseling programs.
“I would personally like to thank Senator Collins and Representative Tarver for their dedicated efforts in getting this important piece of legislation passed.” stated Eric Schuller, President of Alliance for Responsible Consumer Legal Funding, They were not swayed by the opponents of the legislation and ensured that this product can be offered to the consumers of Illinois in a fair and responsible manner.”
Illinois joins Maine, Ohio, Nebraska, Oklahoma, Indiana, Vermont, Tennessee, Nevada and Utah in bringing proper regulation to the industry.
Brian Garelli the President of Preferred Capital Funding said: “I would like to thank Governor Pritzker and the Illinois legislature for making SB 1099 law in Illinois. The bill added over a dozen consumer protections. It also balances the playing field between multibillion dollar insurance companies and injury victims that might not otherwise be able to wait for a fair settlement while their case winds its way through the court system.” The law goes into effect immediately