Bill
S 1310
New Jersey adds a license pathway for for-profit debt adjusters to operate, subject to FTC rules, with fewer bonding requirements but new disclosures and annual reports.
Note: the materials you supplied contain conflicting items (a New Jersey Senate Bill No. 1310 concerning debt adjusters, a Massachusetts docket labeled S.1310 on injured workers, and a different bill title about a New York school mental‑health coordinator). The most detailed and consistent text in your packet is for New Jersey Senate Bill No. 1310 (2R) — a bill that amends New Jersey’s “debt adjusters” law. Below I summarize that bill and its effects. If you intended a different S.1310 (New York or Massachusetts), tell me which jurisdiction and I will re‑summarize.
Summary — New Jersey Senate Bill No. 1310 (2R)
Purpose and intent
- To permit certain for‑profit companies to operate as licensed “debt adjusters” in New Jersey, while maintaining consumer protections and regulatory oversight. The bill creates a new category “for‑profit debt adjuster” and adapts existing licensing, reporting, audit, fee, bonding, and disclosure rules that currently apply only to nonprofit agencies.
Key definitions
- Debt adjuster: person/entity acting for consideration as an intermediary between debtor and creditors to settle or alter debt terms, or who receives funds from debtors for distribution to creditors (existing statutory definition).
- For‑profit debt adjuster: a person or entity that performs debt‑adjustment activities but (1) does not receive or hold, actually or constructively, consumer funds; and (2) is subject to 16 C.F.R. 310.4 (the FTC’s Telemarketing Sales Rule) or any successor federal rule.
Major provisions and changes
- Authorization: For‑profit entities meeting the two conditions above are allowed to act as debt adjusters and must obtain a license from the Commissioner of Banking and Insurance (paralleling existing nonprofit license requirements).
- Bonding: For‑profit debt adjusters are expressly exempted from the bonding requirements that apply to nonprofit social service and consumer credit counseling agencies.
- Audits: All licensees must file annual audits; for‑profit debt adjusters are not required to include the specific certification comparing salaries and expenses to comparable organizations (a requirement for nonprofits).
- Fees: Existing cap for nonprofit debt adjustment fees remains (not to exceed 1% of gross monthly income, and no more than $15/month unless otherwise regulated). The commissioner is authorized to set maximum fees for for‑profit debt adjusters.
- Federal preemption/consistency: Provisions of the state debt adjuster act apply to for‑profit debt adjusters only to the extent they do not conflict with the federal Telemarketing Sales Rule.
- Annual reporting: The commissioner may require an annual report; the bill specifies the report must include statewide totals for: active consumers, enrolled consumers, fees collected, and amount of debt settled. Failure to file triggers existing penalties (up to $100 per day and possible license suspension/revocation).
- Disclosures: Committee amendments add a requirement that for‑profit licensees entering into an agreement with a debtor must disclose certain information to the debtor (the bill text references adding disclosure requirements; the specific disclosure elements are in the bill language).
- Clarification: The bill clarifies and expands the list of persons not deemed to be debt adjusters (e.g., persons engaged in the practice of law).
Who would be affected
- For‑profit debt‑relief companies that do not hold consumer funds but provide negotiation/settlement services and are subject to the FTC Telemarketing Sales Rule.
- Existing nonprofit social service agencies and nonprofit consumer credit counseling agencies (they remain regulated and continue to meet bonding/audit requirements).
- Consumers/debtors who use debt adjustment services (new entrants may expand options; regulatory safeguards maintained).
- Department of Banking and Insurance and the Commissioner — additional licensing oversight, reporting and enforcement duties.
Procedural and timing notes
- Committee activity: reported out of the Senate Commerce Committee with amendments (6/10/2024); Assembly Regulated Professions Committee reported favorably (4/10/2025). Committee amendments added the debtor disclosure requirement and detailed annual report contents.
- Effective date: amendment delays effectiveness until the 180th day after enactment.
- Enforcement: failure to file the required annual report subjects licensees to penalties available under current law (up to $100/day plus possible suspension/revocation).
Potential impacts and considerations
- Market entry: allows certain for‑profit companies to compete in the debt‑adjustment market, potentially increasing consumer choice and market capacity.
- Consumer protection tradeoffs: the bill conditions entry on (1) no receipt/holding of consumer funds and (2) FTC rule coverage; it removes bonding for for‑profits and relaxes one audit certification — potentially reducing some state financial safeguards while relying on federal rules and state licensing/disclosure/reporting to protect consumers.
- Oversight burden: adds new reporting requirements and licensing oversight for the Department of Banking and Insurance.
If you want: I can (a) extract and quote the exact statutory amendments (section and subsection changes), (b) prepare a side‑by‑side comparison of current law vs. the bill, or (c) instead summarize the Massachusetts or New York S.1310 referenced in your packet. Which would you prefer?
Compiled from official sources — confirm details with the bill’s official record.
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