HB 562 -- Buyers Club Law

Sponsor:  Wood

This bill requires travel clubs and vacation clubs to keep their
registration or certificate of authority to do business on file
and in good standing with the Secretary of State.  These clubs
are required annually to file and maintain a bond with corporate
surety or a letter of credit from a bank with the Attorney
General in an amount equal to $100,000 or more if there are
claims filed against the bond.  The information clubs are
required to provide the Attorney General are specified.  In lieu
of the bond or letter of credit, a club can annually provide
proof that it carries a current insurance policy insuring its
customers against non-performance covering losses of at least
$100,000.  The Attorney General can waive the bond or letter of
credit requirement if the club has contracted for at least the
last two years with the Airlines Reporting Corporation.  The bond
or letter of credit will be in favor of the state for the benefit
of any private claimant who suffers a loss.

The seller of a travel club membership is required to deliver a
fully completed contract to the purchaser at the time the
contract is signed.  The bill specifies what must be included in
the contract, including the member's right to cancel.  Anyone who
purchases a travel club membership may cancel by providing
written notice within three business days following the purchase
date.  The seller must provide the purchaser with a confirmation
number within three business days of the sale.  If the
confirmation number is not postmarked prior to the third day, the
customer's right of cancellation extends to the fourteenth
business day following the purchase.  If a purchaser cancels the
contract, he or she is entitled to a full refund, with the
exception of any non-refundable deposits.  The refund will be
delivered to the purchaser within 30 days after the notice of
cancellation is given.  The right to cancel cannot be waived.
Notice of cancellation must be written and will take effect upon
the deposit in a mailbox with the proper postage and address.

Violations of the bill will be subject to all penalties pursuant
to the merchandising practice laws.  All fines collected which
are not used by the Attorney General will be deposited into the
Schools of the Future Fund.

The bill will become effective January 1, 2006.

Missouri House of Representatives
93rd General Assembly, 1st Regular Session
Last Updated August 25, 2005 at 1:19 pm