MO SB542

Creates the Missouri Nonrecourse Consumer Legal Lending Act regulating companies that provide nonrecourse loans to consumers with pending legal claims in exchange for a portion of settlement or judgment proceeds.

Requires consumer legal lending contracts to include detailed disclosures in 12-point bold font, a 5-business-day cancellation right, and a written acknowledgment from the consumer's attorney stating the attorney is not receiving referral fees and has no financial interest in the lending company.

Prohibits licensed attorneys from having direct financial interests in consumer legal lending companies serving their own clients, prohibits misleading advertising, and prevents lending companies from controlling or participating in the underlying legal claim.

Caps fees to semiannual compounding only, limits fee assessment to 1,095 calendar days from the lending date, and requires attorney liens, Medicare liens, and valid healthcare provider liens to take priority over lending company liens.

Requires consumer legal lending companies to register annually with the Department of Insurance, Financial Institutions and Professional Registration beginning June 1, 2015, and establishes criminal penalties of class B misdemeanor for first offense, class A misdemeanor for second offense, and class D felony for subsequent violations.