13-42-122. Trust account.
(1) All money paid to a provider by or on behalf of an individual pursuant to a plan for
distribution to creditors is held in trust. Within two business days after receipt, the provider shall
deposit the money in a trust account established for the benefit of individuals to whom the
provider is furnishing debt-management services.
(2) Money held in trust by a provider is not property of the provider or its designee. The
money is not available to creditors of the provider or designee, except an individual from whom
or on whose behalf the provider received money, to the extent that the money has not been
disbursed to creditors of the individual.
(3) A provider shall:
(a) maintain separate records of account for each individual to whom the provider is
furnishing debt-management services;
(b) disburse money paid by or on behalf of the individual to creditors of the individual as
disclosed in the agreement, except that:
(i) the provider may delay payment to the extent that a payment by the individual is not
final; and
(ii) if a plan provides for regular periodic payments to creditors, the disbursement must
comply with the due dates established by each creditor; and
(c) promptly correct any payments that are not made or that are misdirected as a result of
an error by the provider or other person in control of the trust account and reimburse the
individual for any costs or fees imposed by a creditor as a result of the failure to pay or
misdirection.
(4) A provider may not commingle money in a trust account established for the benefit of
individuals to whom the provider is furnishing debt-management services with money of other
persons.
(5) A trust account must at all times have a cash balance equal to the sum of the balances
of each individual's account.
(6) If a provider has established a trust account pursuant to Subsection (1), the provider
shall reconcile the trust account at least once a month. The reconciliation must compare the cash
balance in the trust account with the sum of the balances in each individual's account. If the
provider or its designee has more than one trust account, each trust account must be individually
reconciled.
(7) If a provider discovers, or has a reasonable suspicion of, embezzlement or other
unlawful appropriation of money held in trust, the provider immediately shall notify the
administrator by a method approved by the administrator. Unless the administrator by rule
provides otherwise, within five days thereafter, the provider shall give notice to the administrator
describing the remedial action taken or to be taken.
(8) If an individual terminates an agreement or it becomes reasonably apparent to a
provider that a plan has failed, the provider shall promptly refund to the individual all money
paid by or on behalf of the individual which has not been paid to creditors, less fees that are
payable to the provider under Section 13-42-123.
(9) Before relocating a trust account from one bank to another, a provider shall inform
the administrator of the name, business address, and telephone number of the new bank. As soon
as practicable, the provider shall inform the administrator of the account number of the trust
account at the new bank.
Enacted by Chapter 154, 2006 General Session
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Last revised: Wednesday, July 23, 2008