Articles by deBanked Staff

Brokers: What’s Your Address and Phone Number?

Brokers, this is no joke. In eighteen days, the State of Florida will by law require that brokers disclose their actual address and phone number in advertisements that promote their services as a broker. This is because Florida’s commercial financing disclosure law added its own twist by incorporating one of DailyFunder’s original rules to its statute.

Furthermore a broker may NOT:

(1) Assess, collect, or solicit an advance fee from a business to provide services as a broker. However, this subsection does not preclude a broker from soliciting a business to pay for, or preclude a business from paying for, actual services necessary to apply for a commercial financing transaction, including, but not limited to, a credit check or an appraisal of security, if such payment is made by check or money order payable to a party independent of the broker.

(2) Make or use any false or misleading representation or omit any material fact in the offer or sale of the services of a broker or engage, directly or indirectly, in any act that operates or would operate as fraud or deception upon any person in connection with the offer or sale of the services of a broker, notwithstanding the absence of reliance by the business.

(3) Make or use any false or deceptive representation in its business dealings.

What’s the risk of non-compliance?

The Florida Attorney General has the right to commence administrative or judicial proceedings to enforce compliance with this part.

1. A violation of this part is punishable by a fine of $500 per incident, not to exceed $20,000 for all aggregated violations, arising from the use of the transaction documentation or materials found to be in violation of this part.

2. A violation of this part after receipt of a written notice of a prior violation from the Attorney General is punishable by a fine of $1,000 per incident, not to exceed $50,000 for all aggregated violations, arising from the use of the transaction documentation or materials found to be in violation of this part.

These rules were signed into law in June of this year and they apply to all deals funded starting January 1, 2024.

Full law here

Missouri Resurrects its Commercial Financing Disclosure Bill

For the third time, a commercial financing disclosure bill has been introduced in Missouri. Senate Bill 753, introduced this month, is nearly identical to SB 187 which failed to gain traction this year.

A staple of the bill is its broker licensing requirement, which would require an annual renewal. Brokers would not be able to broker any deals for Missouri merchants until they were registered.

FCC Seeks to Close the “Lead Generator Loophole” on Texts and Calls

As part of the FCC’s initiative to “combat illegal text messages” the regulator intends to require that texters and callers obtain a consumer’s prior express written consent from a single seller at a time. Specifically, the FCC is acknowledging that lead generation sites or comparison shopping sites attempt to abide by the current rules by obtaining one layer of consent that they then creatively apply as counting toward all the numerous parties they have relationships with. It’s known as the “Lead Generator Loophole.”

“Lead-generated communications are a large percentage of unwanted calls and texts and often rely on flimsy claims of consent to bombard consumers with unwanted robocalls and robotexts,” the FCC said in its proposal. Their solution? One-to-one consent.

First, the one-to-one consent must come after a clear and conspicuous disclosure to the consenting consumer that they will get robotexts and/or robocalls from the seller. “Clear and conspicuous” means notice that would be apparent to a reasonable consumer. In addition, if compliance with the federal Electronic Signatures in Global and National Commerce Act (the E-Sign Act) is required for the consumer’s signature, then all the elements of ESign must be present.”

Second, we adopt our proposal that robotexts and robocalls that result from consumer consent obtained on comparison shopping websites must be logically and topically related to that website. Thus, for example, a consumer giving consent on a car loan comparison shopping website does not consent to get robotexts or robocalls about loan consolidation.

Fortunately, the FCC spells out an example of what might be acceptable as one-to-one consent for a lead generator.

For instance, the website may offer a consumer a check box list that allows the consumer to specifically choose each individual seller that they wish to hear from. Alternatively, the comparison shopping website may offer the consumer a clickthrough link to a specific business so that the business itself may gather express written consent from the consumer directly. Our rule does not prohibit comparison shopping websites from obtaining leads through valid consent and provides multiple opportunities for responsible comparison shopping websites to obtain leads for potential callers.”

According to the National Law Review, “It has not been adopted yet but it looks like it will be in December when voted upon. It looks like the rule will become effective in or around August of 2024.”