SENATE 3rd Reading Unamended May 1, 2013 SENATE Amended 2nd Reading April 30, 2013First Regular Session Sixty-ninth General Assembly STATE OF COLORADO REENGROSSED This Version Includes All Amendments Adopted in the House of Introduction LLS NO. 13-0909.01 Christy Chase x2008 SENATE BILL 13-259 SENATE SPONSORSHIP Newell, HOUSE SPONSORSHIP Melton, Senate Committees House Committees Judiciary Appropriations A BILL FOR AN ACT Concerning the regulation of private investigators by the department of regulatory agencies, and, in connection therewith, making an appropriation. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) Under the current "Private Investigators Voluntary Licensure Act" (act), a private investigator, at his or her option, may apply for a license from the division of professions and occupations (division) in the department of regulatory agencies and, upon satisfaction of the criteria for licensure, the director of the division is to issue a license to the private investigator. Only a person who obtains a license from the division may refer to himself or herself as a licensed private investigator, but no private investigator is required to be licensed by the division. As of March 1, 2014, the bill converts the voluntary licensure program to a mandatory licensure program under which all persons conducting private investigations in this state must obtain a license from the division. Section 5 of the bill modifies the experience criteria for licensure to eliminate the requirement that the prior experience be obtained within the prior 5 years. Under section 6, a person who does not satisfy the experience requirements for licensure may register with the division as a private investigator apprentice and may engage in private investigation activities under the indirect supervision of a licensed private investigator. Section 6 also requires the director to appoint an advisory committee, consisting of 3 licensed private investigators, one representative from law enforcement, and one public member, to make recommendations to the director concerning private investigators and the practice of private investigations. In addition to the exemptions in current law, which are relocated to a new section in the act, section 6 excludes the following persons from the requirements of the act: A person serving process in accordance with rules of civil procedure; A person providing paralegal services under contract with an attorney; and A person recovering a fugitive. Under section 6, licensees and registered apprentices are required to post a surety bond in an amount determined by the director by rule and, under section 7, are subject to discipline for failing to maintain the surety bond. Additionally under section 7, a licensee is subject to discipline for failing to properly supervise a private investigator apprentice or, for licensees and registered apprentices, failing to meet generally accepted standards of private investigations practice. Sections 9 and 11 extend the sunset date for the "Private Investigators Licensure Act" and the functions of the director under the act from September 1, 2016, to September 1, 2021. The advisory committee is also subject to sunset review and repeal on September 1, 2021. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, amend 12-58.5-101 as follows: 12-58.5-101. Short title. This article shall be known and may be cited as the "Private Investigators Voluntary Licensure Registration Act". SECTION 2. In Colorado Revised Statutes, amend 12-58.5-102 as follows: 12-58.5-102. Legislative declaration. The general assembly hereby finds that in order to protect the citizens of the state, and allow private investigators access to public records, it is important to create a licensure registration program to allow qualified require private investigators at their option, to obtain a state-issued license registration to conduct private investigations in this state. SECTION 3. In Colorado Revised Statutes, 12-58.5-103, amend (1), (5) (f), and (6) (a); repeal (4); and add (5.5) and (7) as follows: 12-58.5-103. Definitions. As used in this article, unless the context otherwise requires: (1) "Applicant" means a private investigator person who applies for an initial or renewal license private investigator registration pursuant to this article. (4) "Licensed private investigator" means a private investigator licensed by the director pursuant to this article. (5) "Private investigation" means an investigation for the purpose of obtaining information pertaining to: (f) The causes and origin and cause of, or responsibility for, a fire, libel, slander, a loss, an accident, damage, or an injury to a person or to real or personal property; (5.5) "Private investigations agency" or "agency" means a business whose purpose is to conduct private investigations and that employs private investigators. The term does not include a person or business that contracts with private investigators or with persons exempted from this article pursuant to section 12-58.5-104.5. (6) (a) "Private investigator" or "private detective" means a natural person who, for consideration, engages in business or accepts employment to conduct private investigations. (7) "Registered private investigator" or "registrant" means a natural person registered with the division pursuant to section 12-58.5-105. SECTION 4. In Colorado Revised Statutes, amend 12-58.5-104 as follows: 12-58.5-104. Registration - title protection - penalty. (1) (a) By July 1, 2012 March 1, 2014, a private investigator conducting private investigations in this state who meets the requirements of section 12-58.5-105 may shall obtain a license, as applicable, registration from the director. Only a private investigator who obtains a license registration pursuant to section 12-58.5-105 shall may hold himself or herself out as, or use the title of, a "licensed registered private investigator", "private investigator", "registered private detective", or "private detective". The director shall treat any application for a voluntary private investigator license pending as of March 1, 2014, as an application for the registration required by this section, which application is subject to the requirements of section 12-58.5-105 and as established by the director pursuant to said section. (b) Nothing in this article requires a private investigator engaging in private investigations in this state to obtain a license under this article, but a private investigator who is not so licensed shall not refer to himself or herself as a "licensed private investigator". (2) Any person who conducts private investigations or operates a private investigations agency in this state or who holds himself or herself out as or uses the title "private investigator", "private detective", "registered private detective", or "licensed registered private investigator" without an active license registration issued under this article commits a class 2 misdemeanor and shall be punished as provided in section 18-1.3-501, C.R.S., for the first offense, and, for the second or any subsequent offense, commits a class 1 misdemeanor and shall be punished as provided in section 18-1.3-501, C.R.S. SECTION 5. In Colorado Revised Statutes, amend 12-58.5-105 as follows: 12-58.5-105. Private investigator license registration - qualifications - fees - renewal. (1) Upon application in the form and manner determined by the director, payment of the required fee, submission of business registration documentation as required by subsection (3) of this section, and satisfaction of the requirements of subsection (2) of this section, the director shall issue an initial or renewal license registration to an applicant who provides evidence satisfactory to the director that he or she: (a) Is at least twenty-one years of age; (b) Is lawfully present in the United States; and (c) (I) Has at least four thousand hours of verifiable, applicable experience, as determined by the director within the five years immediately preceding the date of application; or (II) Has at least two thousand hours of verifiable, applicable experience, as determined by the director, within the five years immediately preceding the date of application plus an amount of postsecondary education determined by the director; and (d) Has knowledge and understanding of the statutes and rules affecting the ethics and activities of licensed registered private investigators in this state, as evidenced by passage of a jurisprudence examination developed and approved by the division. (2) In addition to the requirements of subsection (1) of this section, each license registration applicant shall have his or her fingerprints taken by a local law enforcement agency for the purpose of obtaining a fingerprint-based criminal history record check. The applicant is required to submit payment by certified check or money order for the fingerprints and for the actual costs of the record check at the time the fingerprints are submitted to the Colorado bureau of investigation. Upon receipt of fingerprints and receipt of the payment for costs, the Colorado bureau of investigation shall conduct a state and national fingerprint-based criminal history record check utilizing records of the Colorado bureau of investigation and the federal bureau of investigation and shall forward the results of the criminal history record check to the director. (3) If an applicant is an agency that has registered as a business entity with the secretary of state, at the time of application for a license registration the applicant shall provide documentation to the director that the applicant's business registration is current and in good standing with the secretary of state. (4) An applicant for licensure registration under this section shall pay license registration, renewal, and reinstatement fees established by the director pursuant to section 24-34-105, C.R.S. All licenses shall be renewed or reinstated pursuant to A registrant must renew his or her registration in accordance with a schedule established by the director and pursuant to section 24-34-102 (8), C.R.S. If a person registrant fails to renew his or her license registration pursuant to the schedule established by the director, the license registration expires, and the person shall not hold himself or herself out as a licensed registered private investigator or conduct private investigations in the state until he or she pays the appropriate fees to reinstate the license registration and the director reinstates the registration. A person whose registration expires is subject to the penalties provided in this article and section 24-34-102 (8), C.R.S. SECTION 6. In Colorado Revised Statutes, add 12-58.5-106.7; and add with amended and relocated provisions 12-58.5-104.5 as follows: 12-58.5-104.5. Exemptions. [Formerly 12-58.5-103 (6) (b)] (1) "Private investigator" does not include This article does not apply to: (I) (a) A collection agency or consumer reporting agency, as defined in section 12-14-103 (2) and (4.5), respectively; (II) (b) A person conducting an investigation on the person's own behalf, or an employee of an employer conducting an internal investigation on behalf of the his or her employer; (III) (c) An attorney licensed to practice law in this state, an employee or independent contractor of an a licensed attorney, or a person under contract to perform paralegal services for a licensed attorney; licensed to practice law in this state; (IV) (d) A certified peace officer of a law enforcement agency operating in his or her official capacity; (V) A consumer reporting agency, as defined in section 12-14-103; (VI) (e) A certified public accountant certified or authorized to provide accounting services in the state pursuant to article 2 of this title, and an employee of a certified public accountant, or any employee or affiliate of an accounting firm registered pursuant to section 12-2-117; (VII) (f) An investigator employed or contracted by a public or governmental agency; (VIII) (g) A journalist or genealogist; or (IX) (h) A person serving process within the state, performing his or her duties in compliance with the Colorado or federal rules of civil procedure or in accordance with applicable foreign state court rules or laws pertaining to service of foreign process within this state, which includes inquiries related to affecting proper service of process and resulting supporting proofs, declarations, affidavits of service, or declarations or affidavits of due diligence to support alternative methods of service of process; (i) A person attempting to recover a fugitive when that person is a bail bonding agent or cash-bonding agent qualified to write bail bonds pursuant to article 23 of title 10, C.R.S., or is acting pursuant to a contract with or at the request of a bail bonding agent or cash-bonding agent who is so qualified; (j) An owner, employee, or independent contractor of an agency conducting an investigation to determine the origin and cause of a fire or explosion; or (k) An owner, employee, or independent contractor of an agency conducting an investigation for cause analysis or failure analysis where the investigation is conducted by an engineer licensed pursuant to part 1 of article 25 of this title acting within his or her area of expertise within the scope of the practice of engineering. 12-58.5-106.7. Surety bond required - rules. A registered private investigator shall not engage in private investigation activities unless the registered private investigator posts and maintains, or is covered by, a surety bond in an amount determined by the director by rule. SECTION 7. In Colorado Revised Statutes, 12-58.5-107, amend (1) introductory portion, (1) (b), (1) (d), (2), (4), (6) (b) (III), (10) (a), (11) (a), (11) (c) (III), (15) and (16); and add (1) (e), and (1) (f) as follows: 12-58.5-107. Disciplinary actions - grounds for discipline - rules. (1) The director may deny, suspend, or revoke or a registration, place an applicant or registrant on probation, a private investigator's license or issue a letter of admonition to an applicant or registrant if the applicant or registrant: (b) Fails to meet the requirements of section 12-58.5-105 or uses fraud, misrepresentation, or deceit in applying for or attempting to apply for a license registration; (d) Has been subject to discipline related to the practice of private investigations in another jurisdiction. Evidence of disciplinary action in another jurisdiction is prima facie evidence for denial of a license registration or other disciplinary action if the violation would be grounds for disciplinary action in this state. (e) Commits an act or omission that fails to meet generally accepted standards of the practice of private investigations; or (f) Fails to comply with surety bond requirements as specified in section 12-58.5-106.7. (2) The director may adopt rules establishing fines that he or she may impose on a licensee registrant, which rules must include a graduated fine structure, with a maximum allowable fine of not more than three thousand dollars per violation. The director shall transmit any fines he or she collects from a licensee registrant to the state treasurer for deposit in the general fund. (4) (a) The director may commence a proceeding to discipline a licensee registrant when the director has reasonable grounds to believe that the licensee registrant has committed an act enumerated in this section. (b) In any proceeding held under this section, the director may accept as evidence of grounds for disciplinary action any disciplinary action taken against a licensee registrant in another jurisdiction if the violation that prompted the disciplinary action in the other jurisdiction would be grounds for disciplinary action under this article. (6) (b) (III) Upon failure of any witness or licensee registrant to comply with a subpoena or process, the district court of the county in which the subpoenaed person or licensee registrant resides or conducts business, upon application by the director with notice to the subpoenaed person or licensee registrant, may issue to the person or licensee registrant an order requiring the person or licensee registrant to appear before the director; to produce the relevant papers, books, records, documentary evidence, or materials if so ordered; or to give evidence touching the matter under investigation or in question. If the person or licensee registrant fails to obey the order of the court, the court may hold the person or licensee registrant in contempt of court. (10) (a) If it appears to the director, based upon credible evidence as presented in a written complaint, that a licensee registrant is acting in a manner that is an imminent threat to the health and safety of the public, or a person is conducting private investigations or holding himself or herself out as or is using the title "licensed "private investigator" or "private detective" without having obtained a license registration, the director may issue an order to cease and desist the activity. The director shall set forth in the order the statutes and rules alleged to have been violated, the facts alleged to have constituted the violation, and the requirement that all unlawful acts or unregistered practices immediately cease. (11) (a) If it appears to the director, based upon credible evidence as presented in a written complaint, that a person has violated any other portion of this article, in addition to any specific powers granted pursuant to this article, the director may issue to the person an order to show cause as to why the director should not issue a final order directing the person to cease and desist from the unlawful act or unregistered practice. (c) (III) If the director reasonably finds that the person against whom the order to show cause was issued is acting or has acted without the required registration, or has or is about to engage in acts or practices constituting violations of this article, the director may issue a final cease-and-desist order directing the person to cease and desist from further unlawful acts or unregistered practices. (15) (a) When a complaint or investigation discloses an instance of misconduct that, in the opinion of the director, does not warrant formal action by the director but that should not be dismissed as being without merit, the director may issue and send the registrant a letter of admonition. may be issued and sent, by certified mail, to the licensed private investigator. (b) When the director sends a letter of admonition to a licensed registered private investigator, the director shall advise the private investigator registrant that he or she has the right to request in writing, within twenty days after receipt of the letter, that formal disciplinary proceedings be initiated to adjudicate the propriety of the conduct upon which the letter of admonition is based. (c) If the licensed registered private investigator timely requests adjudication, the director shall vacate the letter of admonition and process the matter by means of formal disciplinary proceedings. (16) When a complaint or investigation discloses an instance of conduct that does not warrant formal action by the director and, in the opinion of the director, the complaint should be dismissed, but the director has noticed indications of possible errant conduct by the licensed registered private investigator that could lead to serious consequences if not corrected, the director may send the licensed private investigator registrant a confidential letter of concern. SECTION 8. In Colorado Revised Statutes, amend 12-58.5-108 as follows: 12-58.5-108. Revocation. A person whose license registration is revoked is ineligible to apply for a license registration under this article for at least two years after the date of revocation of the license registration. The director shall treat a subsequent application for licensure registration from a person whose license registration was revoked as an application for a new license registration under this article. SECTION 9. In Colorado Revised Statutes, amend 12-58.5-110 as follows: 12-58.5-110. Repeal of article - review of functions. This article is repealed, effective September 1, 2016 2021. Prior to its the repeal, the department of regulatory agencies shall review the powers, duties, and functions of the director regarding the licensure registration of private investigators as specified in under this article shall be reviewed as provided in section 24-34-104, C.R.S. SECTION 10. Repeal of relocated provision in this act. In Colorado Revised Statutes, repeal 12-58.5-103 (6) (b). SECTION 11. In Colorado Revised Statutes, 24-34-104, amend (47.5) introductory portion; repeal (47.5) (i); and add (52.5) (c) as follows: 24-34-104. General assembly review of regulatory agencies and functions for termination, continuation, or reestablishment. (47.5) The following agencies, functions, or both, shall terminate on September 1, 2016: (i) The voluntary licensing of private investigators by the director of the division of professions and occupations in accordance with article 58.5 of title 12, C.R.S. (52.5) The following agencies, functions, or both, terminate on September 1, 2021: (c) The registering of private investigators by the director of the division of professions and occupations in accordance with article 58.5 of title 12, C.R.S. SECTION 12. Appropriation. (1) In addition to any other appropriation, there is hereby appropriated, out of any moneys in the division of professions and occupations cash fund created in section 24-34-105 (2) (b) (I), Colorado Revised Statutes, not otherwise appropriated, to the department of regulatory agencies, for the fiscal year beginning July 1, 2013, the sum of $4,113, or so much thereof as may be necessary, to be allocated for the implementation of this act as follows: (a) $250 to the division of professions and occupations for jursiprudence exam start up costs; and (b) $3,863 to the executive director's office and administrative services for the purchase of legal services. (2) In addition to any other appropriation, there is hereby appropriated to the department of law, for the fiscal year beginning July 1, 2013, the sum of $3,863, or so much thereof as may be necessary, for the provision of legal services for the department of regulatory agencies related to the implementation of this act. Said sum is from reappropriated funds received from the department of regulatory agencies out of the appropriation made in paragraph (b) of subsection (1) of this section. (3) In addition to any other appropriation, there is hereby appropriated, out of any moneys in the Colorado bureau of investigation identification unit fund created in section 24-33.5-426, Colorado Revised Statutes, not otherwise appropriated, to the department of public safety, for allocation to the Colorado bureau of investigation, for the Colorado crime information center, identification, for the fiscal year beginning July 1, 2013, the sum of $9,875, or so much thereof as may be necessary for fingerprint-based criminal history checks related to the implementation of this act. SECTION 13. Act subject to petition - effective date - applicability. (1) This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 7, 2013, if adjournment sine die is on May 8, 2013); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2014 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor. (2) This act applies to applications for a private investigator registration submitted on or after March 1, 2014.