Licensed lenders are restricted from selling goods at the same place consumer loans are made, and they must make formal loan applications at the lender’s location.
§3515. Conduct of certain business other than making consumer loans prohibited A.(1)(a) A licensed lender shall not engage in the business of making sales of goods at any location where consumer loans are made. The sale and financing of a home protection plan, thrift and buying club memberships, auto club memberships, insurance authorized by the Louisiana Insurance Code, similar consumer benefit club memberships, or financial and tax services, including the use of stored value cards or electronic cash for loan disbursement, shall not be deemed a violation of this Chapter. The word "location" as used in this Section means the entire space in which consumer loans are made, and said location must be separated from any location in which merchandise is sold or displayed by walls that may be broken only by a passageway to which the public is not admitted. (b) In addition, the cost of any home protection plan, club membership, insurance, or service offered pursuant to this Section may, at the option of the consumer, be payable from the proceeds of consumer loans and included on the amount financed, provided that: (i) The sale of a home protection plan, club membership, or service is not a factor in the approval and this fact is clearly disclosed in writing to the consumer. (ii) In order to obtain a home protection plan, club membership, insurance, or service, the consumer gives a specific affirmative written indication of his desire to purchase it after receiving written disclosure of the cost. (2) Nothing contained herein shall be construed to prohibit a licensed lender from conducting the business of making consumer loans under this Chapter on the same premises where a person, not an affiliate of said licensed lender, is engaged in the business of making sales of goods, provided that such licensed lender is not an affiliate. B. A sale of goods or services made with the use of a seller credit card or lender credit card or other credit arrangement at a location other than that of the licensee does not violate this section. Formal application for a loan must be made at the location of the licensed lender; however, when a loan application is taken by persons not employed by the licensed lender, such application shall not be deemed a violation of this section. C. An occasional sale of property used in the ordinary course of the business of the licensee does not violate this section. D. A sale of property seized or legally recovered by the licensed lender does not violate this Section. E. No licensed lender shall conduct the business of making consumer loans under this Chapter under any name and from or at any place of business within this state, other than that stated in the license. The closing of a consumer loan on immovable property in the office of a notary public shall not violate this Section. Loans made by mail where credit approval is given at the location of the lender and loans made with the use of a lender credit card shall not violate this Section. Loans governed by R.S. 9:3550 that are closed at an insurance agent/broker's location shall not violate this Section provided the loan shall be accepted by a licensed lender. F. The commissioner may issue a permit to persons licensed and regulated by the Office of Financial Institutions under the provisions of R.S. 37:1781 through 1808 to conduct the sale of goods and services at a location where consumer loans are made pursuant to the provisions of this Chapter. The commissioner shall have the authority to deny the permit or suspend or terminate the permit for violations of this Chapter. The commissioner may adopt rules to implement the provisions of this Subsection. Such rules shall require the commissioner to grant or deny the permit within thirty days from the date the application for a permit is filed with the Office of Financial Institutions. Added by Acts 1972, No. 454, §1, eff. Jan. 1, 1973. Amended by Acts 1974, No. 466, §1; Acts 1980, No. 694, §1; Acts 1986, No. 584, §1, eff. July 2, 1986; Acts 1991, No. 693, §1; Acts 1992, No. 218, §1; Acts 1995, No. 1184, §2; Acts 2003, No. 578, §1; Acts 2004, No. 346, §1; Acts 2004, No. 347, §1; Acts 2005, No. 101, §1; Acts 2006, No. 213, §1.