Texas: Up to $10,000 Per Violation, and a Registration Deadline Coming
Texas’s HB 700, which took effect September 1, 2025, carries no de minimis exemption, meaning a broker cannot assume a small transaction volume exempts them from compliance. Per Venable’s coverage of the state disclosure landscape, the Texas Office of Consumer Credit Commissioner has enforcement authority to fine a non-compliant broker or provider up to $10,000 per violation, and separately requires broker and provider registration by December 31, 2026.
That registration deadline is worth naming as a distinct obligation from the disclosure requirements themselves. A broker who has never registered with the OCCC, regardless of how carefully they’ve been handling merchant disclosures, is still out of compliance with a separate part of the same law.
New York: A Penalty That Doubles If It’s Willful
New York’s Commercial Finance Disclosure Law takes a different approach entirely. Per Stark & Stark’s legal analysis of the statute’s penalty provision, published via JD Supra, an ordinary violation carries a civil penalty of $2,000 per violation, rising to $10,000 per violation if the violation is found to be willful, with the state Superintendent additionally able to seek restitution and injunctive relief for knowing violations. That is a structure built to punish carelessness moderately and deliberate non-compliance far more severely, not a flat fee applied identically regardless of intent.
The penalty-provision analysis cited here dates to 2022, ahead of the law’s eventual effective date after a delayed rulemaking process; the dollar amounts themselves are set by statutory text and are not expected to shift with implementation timing, but confirming the current penalty section against the codified New York law is worth doing before repeating an exact figure in an external communication.
Louisiana: A Third, Different Penalty Formula
Louisiana’s law, enacted via SB 335, builds a third structure on top of the two above. Per BillTrack50’s bill-tracking summary of the statute, penalties run $500 per incident, capped at $20,000, for a first violation, and $1,000 per incident, capped at $50,000, for subsequent violations. Enforcement rests exclusively with the state Attorney General, and the law creates no private right of action, meaning a merchant cannot bring their own lawsuit directly under this specific statute the way they might under a different legal theory.
The exact effective date and the precise transaction-count threshold that defines a covered “provider” under Louisiana’s law carry some disagreement across sources this research pass found; the penalty figures themselves are not part of that disagreement and are stated here as reported by the same bill-tracking source.
Why “Per Violation” Adds Up Faster Than It Sounds
A single number like “$10,000 per violation” undersells the real exposure, because it is a per-instance figure, not a capped total. A broker operating in Texas who sends a non-compliant disclosure to ten separate merchants in a single quarter is not looking at one $10,000 exposure, they are looking at up to $100,000 in maximum statutory exposure across those ten instances, since each non-compliant disclosure is its own violation under the statute’s own framing.
That math is exactly why treating disclosure compliance as a one-time template fix, rather than a per-communication discipline, understates the actual risk. A flawed template used across dozens of merchants multiplies the exposure by however many times it gets used, not once.
What “No Private Right of Action” Does and Doesn’t Protect You From
Louisiana’s no-private-right-of-action provision means a merchant cannot sue a broker directly under this specific disclosure statute; it does not mean the penalty exposure disappears, since the Attorney General retains exclusive enforcement authority and the $500-to-$50,000 penalty structure above still applies. It also does not mean a merchant has no other legal avenue at all, since a separate legal theory, fraud, breach of contract, or another applicable statute, could still be available even where this specific law bars a private suit.
Reading “no private right of action” as “no real risk” is a mistake worth avoiding; it changes who can bring the enforcement action, not whether the penalty itself is real.
The Registration Deadline Most ISOs Haven’t Started On
Texas’s December 31, 2026 broker and provider registration deadline, mentioned above, is worth returning to directly: as of this article’s publication, that deadline is a little over four months away. A registration requirement is easy to deprioritize relative to disclosure-language fixes, since it doesn’t show up in day-to-day merchant conversations the way a compliant offer letter does, but missing it is its own separate compliance failure, independent of how carefully a broker is already handling everything else.
Confirming registration status now, rather than treating it as a later-2026 task, is the single most concrete action this article’s three-state comparison points toward.
Sources
The external data in this article draws on the sources below. Figures described in the text as estimates or industry triangulations are directional and are not attributed to a single dataset.
- Venable, State Commercial Financing Disclosure Laws
- Stark & Stark, New York Commercial Finance Disclosure Law, via JD Supra
- BillTrack50, Louisiana SB 335 Summary