H 5068 (2023–2024) bill page — Uniform Money Services Act
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2023-2024 Bill 5068: Uniform Money Services Act - South Carolina Legislature Online
South Carolina General Assembly
125th Session, 2023-2024
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Indicates Matter Stricken
Indicates New Matter
H. 5068
STATUS INFORMATION
General Bill
Sponsors: Rep. Sandifer
Companion/Similar bill(s): 1031
Document Path: LC-0486SA24.docx
Introduced in the House on February 8, 2024
Labor, Commerce and IndustrySummary: Uniform Money Services Act
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
2/8/2024 House Introduced and read first time (House Journal-page 20)
2/8/2024 House Referred to Committee on Labor, Commerce and Industry (House Journal-page 20)
View the latest legislative information at the website
VERSIONS OF THIS BILL
02/08/2024
A bill
TO AMEND THE SOUTH CAROLINA CODE OF LAWS
BY AMENDING CHAPTER 11 OF TITLE 35, RELATING TO ANTI-MONEY LAUNDERING, SO AS TO
INCORPORATE THE UNIFORM MONEY SERVICES ACT, TO PROTECT THE PUBLIC FROM
FINANCIAL CRIME, STANDARDIZE THE TYPES OF ACTIVITIES THAT ARE SUBJECT TO
LICENSING, AND MODERNIZE SAFETY AND SOUNDNESS REQUIREMENTS TO ENSURE FUNDS ARE
PROTECTED IN AN ENVIRONMENT THAT SUPPORTS INNOVATIVE AND COMPETITIVE BUSINESS
PRACTICES.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 11, Title 35 of the
S.C. Code is amended to read:
CHAPTER 11
South Carolina
Anti-Money LaunderingUniform
Money Services Act
Article 1
General
Provisions
Section 35-11-100. This chapter may be cited
as the "South Carolina Anti-Money Laundering Uniform Money Services Act".
Section 35-11-105. As
used in this chapter:
(1) "Acting in concert" means persons
knowingly acting together with a common goal of jointly acquiring control of a
licensee whether or not pursuant to an express agreement.
(1)(2) "Applicant" means a person that files an application
for a license pursuant to this act.
(2)(3) "Authorized delegate" means a person a licensee
designates to provide money services on behalf of the licensee.
(3) "Bank"
means an institution organized under federal or state law which:
(a)
accepts demand deposits or deposits that the depositor may use for payment to
third parties and which engages in the business of making commercial loans; or
(b)
engages in credit card operations and maintains only one office that accepts
deposits, does not accept demand deposits or deposits that the depositor may
use for payments to third parties, does not accept a savings or time deposit
less than one hundred thousand dollars, and does not engage in the business of
making commercial loans.
(4) "Average daily money transmission
liability" means the amount of the licensee's outstanding money transmission
obligations in this State at the end of each day in a given period of time,
added together, and divided by the total number of days in the given period of
time. For purposes of calculating average daily money transmission liability
under this chapter for any licensee required to do so, the given period of time
must be the quarters ending March thirty-first, June thirtieth, September
thirtieth, and December thirty-first.
(5) "Bank Secrecy Act" means the Bank
Secrecy Act, 31 U.S.C. Section 5311, et seq., and its implementing regulations,
as amended and recodified from time to time.
(6) "Closed loop stored value" means
stored value that is redeemable by the issuer only for goods or services
provided by the issuer or its affiliate or franchisees of the issuer or its
affiliate, except to the extent required by applicable law to be redeemable in
cash for its cash value.
(4)(7) "Commissioner" means the South Carolina Attorney
General.
(5)(8)(a)
"Control" means:
(a)(i) ownership of, or the power
to vote, directly or indirectly, at least twenty-five percent of a class of voting securities the
outstanding voting shares or voting interests of a licensee or person in
control of a licensee;
(b)(ii) the power to elect or appoint a majority of key
individuals or executive officers, managers, directors, trustees, or
other persons exercising managerial authority of a licensee or person in
control of a licensee; or
(c)(iii) the power to exercise
directly or indirectly, a controlling influence over the management or policies
of a licensee or person in control of a licensee.
(b)(i) A person is presumed to exercise a
controlling influence when the person holds the power to vote, directly or
indirectly, at least ten percent of the outstanding voting shares or voting
interests of a licensee or person in control of a licensee.
(ii) A person presumed to exercise a
controlling influence as defined by this subitem can rebut the presumption of
control if the person is a passive investor.
(c) For purposes of determining the
percentage of a person controlled by any other person, the person's interest must
be aggregated with the interest of any other immediate family member, including
the person's spouse, parents, children, siblings, mothers- and fathers-in-law,
sons- and daughters-in-law, brothers- and sisters-in-law, and any other person
who shares such person's home.
(6)(9) "Currency exchange" means receipt of revenues from the
exchange of money of one government for money of another government.
(10) "Eligible rating" means a credit
rating of any of the three highest rating categories provided by an eligible
rating service, whereby each category may include rating modifiers such as "plus"
or "minus" for S&P, or the equivalent for any other eligible rating
service. Long-term credit ratings are considered to be eligible if the rating
is equal to A- or higher by S&P, or the equivalent from any other eligible
rating service. Short-term credit ratings are deemed eligible if the rating is
equal to or higher than A-2 or SP-2 by S&P, or the equivalent from any
other eligible rating service. In the event that ratings differ among eligible
rating services, the highest rating shall apply when determining whether a
security bears an eligible rating.
(11) "Eligible rating service" means
any Nationally Recognized Statistical Rating Organization (NRSRO) as defined by
the U.S. Securities and Exchange Commission, and any other organization
designated by the Commissioner by rule or order.
(7)(12) "Executive officer" means a president, chairperson of
the executive committee, chief financial officer, responsible individual, or
other individual who performs similar functions.
(13) "Federally insured depository financial institution" means a
bank, credit union, savings and loan association, trust company, savings
association, savings bank, industrial bank, or industrial loan company
organized under the laws of the United States or any state of the United
States, when such bank, credit union, savings and loan association, trust
company, savings association, savings bank, industrial bank, or industrial loan
company has federally insured deposits.
(14) "In this State" means at a
physical location within this State for a transaction requested in person. For
a transaction requested electronically or by phone, the provider of the money
transmission may determine if the person requesting the transaction is "in this
State" by relying on other information provided by the person regarding the
location of the individual's residential address or a business entity's
principal place of business or other physical address location, and any records
associated with the person that the provider of money transmission may have
that indicate such location including, but not limited, to an address
associated with an account.
(15) "Individual" means a natural
person.
(16)
"Key individual" means any individual ultimately responsible for establishing
or directing policies and procedures of the licensee, such as an executive
officer, manager, director, or trustee.
(8)(17) "Licensee" means a person licensed pursuant to this
act.
(18) "Material litigation" means
litigation, that according to United States generally accepted accounting
principles, is significant to a person's financial health and would be required
to be disclosed in the person's annual audited financial statements, report to
shareholders, or similar records.
(9)(19) "Monetary value" means a medium of exchange, whether
or not redeemable in money.
(10)(20) "Money" means a medium of exchange that is authorized
or adopted by the United States or a foreign government. The term includes a
monetary unit of account established by an intergovernmental organization or by
agreement between two or more governments.
(11)(21) "Money services"
means money transmission or currency exchange.
(12)(22)(a) "Money
transmission" means any of the following:
(i) selling or issuing payment instruments to a person located in this State,;
(ii) selling or issuing stored value
to a person located in this State,; or
(iii) receiving money or monetary
value for transmission in this State.
(b) The term includes payroll
processing services, but does not include the provision solely of
delivery, online or telecommunications services, or network access.
(23) "MSB accredited state" means a
state agency that is accredited by the Conference of State Bank Supervisors and
Money Transmitter Regulators Association for money transmission licensing and
supervision.
(24) "Multistate licensing process"
means any agreement entered into by and among state regulators relating to
coordinated processing of applications for money transmission licenses,
applications for the acquisition of control of a licensee, control determinations,
or notice and information requirements for a change of key individuals.
(25) "NMLS" means the Nationwide
Multistate Licensing System and Registry developed by the Conference of State
Bank Supervisors and the American Association of Residential Mortgage
Regulators and owned and operated by the State Regulatory Registry, LLC, or any
successor or affiliated entity, for the licensing and registration of persons
in financial services industries.
(13)(26) "Outstanding money transmission
obligation", with respect to a payment instrument,
means issued or sold by or for the licensee and reported as sold but not yet
paid by or for the licensee is established and
extinguished in accordance with applicable state law and means:
(a) any payment instrument or stored
value issued or sold by the licensee to a person located in the United States
or reported as sold by an authorized delegate of the licensee to a person that
is located in the United States that has not yet been paid or refunded by or
for the licensee, or escheated in accordance with applicable abandoned property
laws; or
(b) any money received for
transmission by the licensee or an authorized delegate in the United States
from a person located in the United States that has not been received by the
payee or refunded to the sender or escheated in accordance with applicable abandoned
property laws.
(c) For purposes of this subsection, "in
the United States" includes, to the extent applicable, a person in any state,
territory, or possession of the United States; the District of Columbia; the
Commonwealth of Puerto Rico; or a U.S. military installation that is located in
a foreign country.
(27) "Passive investor" means a
person that:
(a) does not have the power to elect a
majority of key individuals or executive officers, managers, directors,
trustees, or other persons exercising managerial authority of a person in
control of a licensee;
(b) is not employed by and does not
have any managerial duties of the licensee or person in control of a licensee;
(c) does not have the power to
exercise, directly or indirectly, a controlling influence over the management
or policies of a licensee or person in control of a licensee; and
(d) either:
(i) attests to subitems (a), (b), and
(c), in a form and in a medium prescribed by the Commissioner; or
(ii) commits to the passivity
characteristics of subitems (a), (b), and (c), in a written document.
(14)(28) "Payment instrument" means a
written or electronic check, draft, money order, traveler's check, or
other written or electronic instrument for the
transmission or payment of money or monetary value, whether or not negotiable.
The term does not include a credit card voucher, letter of
credit, or instrument that is redeemable by the issuer in goods or services. stored value or any instrument that (A) is redeemable by the
issuer only for goods or services provided by the issuer or its affiliate or
franchisees of the issuer or its affiliate, except to the extent required by
applicable law to be redeemable in cash for its cash value; or (B) not sold to
the public but issued and distributed as part of a loyalty, rewards, or
promotional program.
(29) "Payroll
processing services" means receiving money for transmission pursuant to a
contract with a person to deliver wages or salaries, make payment of payroll
taxes to state and federal agencies, make payments relating to employee benefit
plans, or make distributions of other authorized deductions from wages or
salaries. The term "payroll processing services" does not include an employer
performing payroll processing services on its own behalf or on behalf of its
affiliate, or a professional employment organization subject to regulation
under other applicable state law.
(15)(30) "Person" means an
individual, corporation, business trust, estate,
trust, general partnership, limited
partnership, limited-liability company, association, joint venturestock corporation, government, governmental subdivision, agency or instrumentality,
public corporation, or another legal or commercial entity or other corporate entity identified by the Commissioner.
(16)(31) "Record" means information that is inscribed on a
tangible medium or that is stored in an electronic or other medium and is
retrievable in perceivable form.
(17)(32) "Responsible
individual" means an individual who is employed by a licensee and has principal
managerial authority over the provision of money services by the licensee in
this State. "Receiving money for transmission" or "money
received for transmission" means receiving money or monetary value in the
United States for transmission within or outside the United States by
electronic or other means.
(18)(33) "State" means a state, of the United States, the District of Columbia, Puerto Rico, the
United States Virgin Islands, or a territory,
or insular possession subject
to the jurisdiction of the United States, the
District of Columbia, or the Commonwealth of Puerto Rico.
(19)(34) "Stored value" means monetary value that is evidenced by an electronic record.representing a claim against the issuer evidenced by an
electronic or digital record, and that is intended and accepted for use as a
means of redemption for money or monetary value, or payment for goods or
services. The term includes, but is not limited to, "prepaid access" as defined
by 31 C.F.R. Section 1010.100, as amended or recodified from time to time.
Notwithstanding the foregoing, the term "stored value" does not include a
payment instrument or closed loop stored value, or stored value not sold to the
public but issued and distributed as part of a loyalty, rewards, or promotional
program.
(35) "Tangible net worth" means the
aggregate assets of a licensee excluding all intangible assets, less
liabilities, as determined in accordance with United States generally accepted
accounting principles.
(20)(36) "Unsafe or unsound practice" means a practice or
conduct by a person licensed to engage in money transmission or an authorized
delegate of such a person, which creates the likelihood of material loss,
insolvency, or dissipation of the licensee's assets, or otherwise materially
prejudices the interests of its customers.
Section 35-11-110. (A) This chapter does not
apply to:
(1) the United States or a department,
agency, or instrumentality of the United Statesthereof, or its agent;
(2) money transmission by the United
States Postal Service or by a contractor on behalf an agent of the United States Postal Service;
(3) a state, county, city, or another any other governmental
agency or governmental subdivision or instrumentality
of a state, or its agent;
(4) a bank, bank
holding company, office of an international banking corporation, branch of a
foreign bank, corporation organized pursuant to the Bank Service Corporation
Act, 12 U.S.C. Section 1861-1867 (Supp. V 1999), or corporation organized under
the Edge Act, 12 U.S.C. Section 611-633 (1994 & Supp. V 1999), under the
laws of a state or the United States if it does not issue, sell, or provide
payment instruments or stored value through an authorized delegate who is not
such a persona federally insured depository
financial institution, bank holding company, office of an international banking
corporation, foreign bank that establishes a federal branch pursuant to the
International Bank Act, 12 U.S.C. Section 3102, as amended or recodified from
time to time, corporation organized pursuant to the Bank Service Corporation
Act, 12 U.S.C. Sections 1861-1867, as amended or recodified from time to time,
or corporation organized under the Edge Act, 12 U.S.C. Sections 611-633, as
amended or recodified from time to time;
(5) electronic funds transfer of
governmental benefits for a federal, state, county, or governmental agency by a
contractor on behalf of the United States or a department, agency, or
instrumentality of the United Statesthereof, or on behalf of a
state or governmental subdivision, agency, or instrumentality of a statethereof;
(6) a board of trade designated as a
contract market under the federal Commodity Exchange Act, 7 U.S.C. Section 1-25
(1994) as amended or
recodified from time to time, or a person that, in the ordinary course
of business, provides clearance and settlement services for a board of trade to
the extent of its operation as or for a board of trade;
(7) a registered futures commission
merchant under the federal commodities laws to the extent of its operation as a
futures commission merchant;
(8) a
person who provides clearance or settlement services pursuant to a registration
as a clearing agency or an exemption from that registration granted under the
federal securities laws to the extent of its operation as a provider of
clearance or settlement services;
(9)(8) an operator of a payment system to the extent that it
provides processing, clearing, or settlement services, between or among persons
excluded exempted by
this section, in connection with wire transfers, credit card transactions,
debit card transactions, stored-value transactions, automated clearing house
transfers, or similar funds transfers;
(10)(9) a person registered as a securities broker-dealer
under federal or state securities laws to the extent of his operation as a
securities broker-dealer; or
(11)(10) a credit union regulated and
insured by the National Credit Union Association.an
individual employed by a licensee, authorized delegate, or any person exempted
from the licensing requirements of this chapter when acting within the scope of
employment and under the supervision of the licensee, authorized delegate, or
exempted person as an employee and not as an independent contractor;
(11) a person expressly appointed as
a third-party service provider to, or agent of, an entity exempt under Section
35-11-110 (A)(4), solely to the extent that:
(a) such service provider or agent is
engaging in money transmission on behalf of and pursuant to a written agreement
with the exempt entity that sets forth the specific functions that the service
provider or agent is to perform; and
(b) the exempt entity assumes all risk
of loss and all legal responsibility for satisfying the outstanding money
transmission obligations owed to purchasers and holders of the outstanding
money transmission obligations upon receipt of the purchaser's or holder's
money or monetary value by the service provider or agent;
(12) a person appointed as an agent
of a payee to collect and process a payment from a payor to the payee for goods
or services, other than money transmission itself, provided to the payor by the
payee, provided that:
(a) there exists a written agreement
between the payee and the agent directing the agent to collect and process
payments from payors on the payee's behalf;
(b) the payee holds the agent out to
the public as accepting payments for goods or services on the payee's behalf;
and
(c) payment for the goods and services
is treated as received by the payee upon receipt by the agent so that the payor's
obligation is extinguished and there is no risk of loss to the payor if the
agent fails to remit the funds to the payee;
(13) a person that acts as an
intermediary by processing payments between an entity that has directly
incurred an outstanding money transmission obligation to a sender, and the
sender's designated recipient, provided that the entity:
(a) is properly licensed or exempt
from licensing requirements under this chapter;
(b) provides a receipt, electronic
record, or other written confirmation to the sender identifying the entity as
the provider of money transmission in the transaction; and
(c) bears sole responsibility to
satisfy the outstanding money transmission obligation to the sender, including
the obligation to make the sender whole in connection with any failure to
transmit the funds to the sender's designated recipient; or
(14) a person exempt by regulation or
order if the Commissioner finds such exemption to be in the public interest and
that the regulation of such person is not necessary for the purposes of this chapter.
(B) The Commissioner may require that
a person claiming to be exempt from licensing pursuant to this section provide
information and documentation to the Commissioner demonstrating that it
qualifies for any claimed exemption.
Article 2
Money
Transmission Licenses
Section 35-11-200. (A)
A person may not engage in the business of money transmission or advertise,
solicit, or hold himself out as providing money transmission unless the person
is:
(1) licensed under this chapter or approved to engage in money transmission pursuant to
Section 35-11-210article;
(2) an authorized delegate of a person
licensed pursuant to this article; or
(3) an authorized
delegate of a person approved to engage in money transmission pursuant to
Section 35-11-210exempted under Section 35-11-110.
(B) A license issued pursuant to this
chapter is not transferable or assignable.
Section 35-11-205. (A)
In this section, "material litigation" means litigation
that according to generally accepted accounting principles is significant to an
applicant's or a licensee's financial health and would be required to be
disclosed in the applicant's or licensee's annual audited financial statements,
report to shareholders, or similar records.
(B) A person
applying for a license pursuant to this article shall do so in a form and in a
medium prescribed by the commissionerCommissioner. Each form must contain
content as set forth by regulation, order, instruction, or procedure of the
Commissioner and may be changed or updated by the Commissioner in accordance
with applicable law in order to carry out the purposes of this chapter and
maintain consistency with NMLS licensing standards and practices. The
application must state or contain:
(1) the legal name, residential and
business addresses of the applicant, and any fictitious or trade name used by
the applicant in conducting its business;
(2) a list of any criminal convictions
of the applicant and any material litigation in which the applicant has been
involved in the ten-year period next preceding the submission of the
application;
(3) a description of any money
services previously provided by the applicant and the money services that the
applicant seeks to provide in this State;
(4) a list of the applicant's proposed
authorized delegates and the locations in this State where the applicant and
the applicant's authorized delegates propose to engage in money transmission or
provide other money services;
(5) a list of other states in which
the applicant is licensed to engage in money transmission or provide other
money services and any license revocations, suspensions, or other disciplinary
action taken against the applicant in another state;
(6) information concerning a
bankruptcy or receivership proceeding affecting the licensee or a person in control of a licensee;
(7) a sample form of contract for
authorized delegates, if applicable, and;
(8) a
sample form of payment instrument or instrument upon which
stored value is recorded, if applicable;
(8)(9) the name and address of any bank federally insured depository financial institution through
which the applicant's payment instruments and stored value
will be paidapplicant plans to conduct money
transmission; and
(9) a
description of the source of money and credit to be used by the applicant to
provide money services; and
(10) other information the
commissioner reasonably requires with respect to the applicant.
(C)(B) If an applicant is a corporation, limited liability
company, partnership, or other legal entity, the
applicant also shall provide:
(1) the date of the applicant's
incorporation or formation and state or country of incorporation or formation;
(2) if applicable, a certificate of
good standing from this State and the state or
country in which the applicant is incorporated or formed;
(3) a brief description of the
structure or organization of the applicant, including a parent entity or
subsidiary of the applicant, and whether a parent entity or subsidiary is
publicly traded;
(4) the legal name, a fictitious or
trade name, all business and residential addresses, and the employment, in the
ten-year period next preceding the submission of the application of each
executive officer, manager, director, or person who has control of the
applicant;
(5) a list of criminal convictions and
material litigation in which an executive officer, a manager, director, or
person in control of, the applicant has been involved in the ten-year period
next preceding the submission of the application;
(6) a copy of the applicant's audited
financial statements for the most recent fiscal year and, if available, for the
two-year period next preceding the submission of the application or, if determined to be acceptable to the Commissioner,
certified unaudited financial statements for the most recent fiscal year or
other period acceptable to the Commissioner;
(7) a copy of the
applicant's unconsolidated financial statements for the current fiscal year,
whether audited or not, and, if available, for the two-year period next
preceding the submission of the applicationcertified
copy of unaudited financial statements of the applicant for the most recent
fiscal quarter;
(8) if the applicant is publicly
traded, a copy of the most recent report filed with the United States
Securities and Exchange Commission pursuant to Section 13 of the federal
Securities Exchange Act of 1934, 15 U.S.C. Section 78m (1994
& Supp. V 1999)as amended or recodified from
time to time;
(9) if the applicant is a wholly owned
subsidiary of a:
(a) corporation publicly traded in the
United States, a copy of audited financial statements for the parent
corporation for the most recent fiscal year or a copy of the parent corporation's
most recent report filed pursuant to Section 13 of the federal Securities
Exchange Act of 1934, 15 U.S.C. Section 78m (1994 &
Supp. V 1999) as amended or recodified from time to
time; or
(b) corporation publicly traded
outside the United States, a copy of similar documentation filed with the
regulator of the parent corporation's domicile outside the United States;
(10) if the
applicant has a registered agent in this State, the name and address of
the applicant's registered agent in this State; and
(11) other information the commissioner Commissioner reasonably
requires with respect to the applicant.
(D)(C) A nonrefundable application fee of one thousand five
hundred dollars and a license fee of seven hundred fiftyone thousand six hundred dollars must accompany an
application for a license pursuant to this article. The license fee must be
refunded if the application is denied.
(E)(D) The commissioner Commissioner may waive one or more requirements of
subsections (B)(A) and (C)(B) or permit an applicant
to submit other information in lieu of the required information.
Section 35-11-210. (A)
A person who is licensed to engage in money transmission
in at least one other state, with the approval of the commissioner and in
accordance with this section, may engage in money transmission and currency
exchange in this State without being licensed pursuant to Section 35-11-205 if
the:
(1)
state in which the person is licensed has enacted the Uniform Money Services
Act or the commissioner determines that the money transmission laws of that
state are substantially similar to those imposed by the law of this State;
(2)
person submits to, and in the form required by, the commissioner:
(a)
in a record, an application for approval to engage in money transmission and
currency exchange in this State without being licensed pursuant to Section
35-11-205;
(b)
a nonrefundable fee of one thousand dollars; and
(c)
a certification of license history in the other state.
(B) When
an application for approval pursuant this section is complete, the commissioner
shall promptly notify the applicant in a record, of the date on which the
request was determined to be complete and:
(1) the
commissioner shall approve or deny the request within one hundred twenty days
after that date; or
(2) if
the request is not approved or denied within one hundred twenty days after that
date the:
(a)
request is approved; and
(b)
approval takes effect as of the first business day after expiration of the one
hundred twenty-day period.
(C) A
person who engages in money transmission and currency exchange in this State
pursuant to this section shall comply with the requirements of, and is subject
to the sanctions provided in this chapter, as if the person were licensed
pursuant to Section 35-11-220.Any individual in control of a licensee or applicant, any individual
that seeks to acquire control of a licensee, and each key individual shall
furnish to the Commissioner through NMLS the following items:
(1) the individual's fingerprints for
submission to the Federal Bureau of Investigation and the Commissioner for
purposes of a national criminal history background check unless the person
currently resides outside of the United States and has resided outside of the
United States for the last ten years; and
(2) personal history and experience in
a form and in a medium prescribed by the Commissioner, to obtain the following:
(a) an independent credit report from
a consumer reporting agency unless the individual does not have a Social
Security number, in which case, this requirement must be waived;
(b) information related to any
criminal convictions or pending charges; and
(c) information related to any
regulatory or administrative action and any civil litigation involving claims
of fraud, misrepresentation, conversion, mismanagement of funds, breach of
fiduciary duty, or breach of contract.
(B) If the individual has resided
outside of the United States at any time in the last ten years, the individual
also shall provide an investigative background report prepared by an
independent search firm that meets the following requirements:
(1) at a minimum, the search firm
shall:
(a) demonstrate that it has sufficient
knowledge, resources, and employs accepted and reasonable methodologies to
conduct the research of the background report; and
(b) not be affiliated with or have an
interest with the individual it is researching;
(2) at a minimum, the investigative
background report must be written in the English language and must contain the
following:
(a) if available in the individual's
current jurisdiction of residency, a comprehensive credit report, or any
equivalent information obtained or generated by the independent search firm to accomplish
such report, including a search of the court data in the countries, provinces,
states, cities, towns, and contiguous areas where the individual resided and
worked;
(b) criminal records information for
the past ten years including, but not limited to, felonies, misdemeanors, or
similar convictions for violations of law in the countries, provinces, states,
cities, towns, and contiguous areas where the individual resided and worked;
(c) employment history;
(d) media history, including an
electronic search of national and local publications, wire services, and
business applications; and
(e) financial services-related
regulatory history including, but not limited to, money transmission,
securities, banking, insurance, and mortgage-related industries.
Section 35-11-215. (A)
Except as otherwise provided in subsection (B),An applicant for a money transmission license must provide, and
a licensee at all times must maintain, security consisting of a surety
bond, letter of credit, or other similar security in a
form acceptable to the commissioner Commissionerin the amount of fifty
thousand dollars plus ten thousand dollars for each location, not exceeding a
total addition of two hundred fifty thousand dollars, must accompany an
application for a license.
(B) Security must
be in a form satisfactory to the commissioner and payable to the State for the
benefit of a claimant against the licensee to secure the faithful performance
of the obligations of the licensee with respect to money transmission.The amount of the required security must be:
(1) the greater of one hundred
thousand dollars or an amount equal to one hundred percent of the licensee's
average daily money transmission liability in this State calculated for the
most recently completed three-month period, up to a maximum of five hundred
thousand dollars; or
(2) in the event that the licensee's
tangible net worth exceeds ten percent of total assets, the licensee shall
maintain a surety bond of one hundred thousand dollars.
(C) The aggregate
liability on a surety bond may not exceed the principal sum of the bond. A
claimant against a licensee may maintain an action on the bond, or the
commissioner may maintain an action on behalf of the claimant.A licensee that maintains a bond in the maximum amount provided
for in Section 35-11-215(B)(1) or (2) may not be required to calculate its
average daily money transmission liability for purposes of this section.
(D) A surety bond
must cover claims for so long as the commissioner specifies, but for at least
five years after the licensee ceases to provide money services in this State.
However, the commissioner may permit the amount of security to be reduced or
eliminated before the expiration of that time to the extent the amount of the
licensee's payment instruments or stored-value obligations outstanding in this
State is reduced. The commissioner may permit a licensee to substitute another
form of security acceptable to the commissioner for the security effective at
the time the licensee ceases to provide money services in this State.A licensee may exceed the maximum required bond amount pursuant
to Section 35-11-605(A)(5).
(E) In
lieu of the security prescribed in this section, an applicant for a license or
a licensee may provide security in a form prescribed by the commissioner.
(F) The
commissioner may increase the amount of security required to a maximum of one
million dollars if the financial condition of a licensee so requires, as
evidenced by reduction of net worth, financial losses, or other relevant
criteria.
Section 35-11-220. (A)
When an application for an original license is
filed and considered complete pursuant to this
article, the commissioner Commissioner
shall investigate the applicant's financial condition and
responsibility, financial and business experience, character, and general
fitness. The commissioner Commissioner
may conduct an on-site investigation of the applicant, the reasonable
cost of which the applicant must pay. The commissioner Commissioner shall issue a license to an applicant
pursuant to this article if the commissioner Commissioner finds that all of the following conditions
have been fulfilled:
(1) the applicant has complied with
Sections 35-11-205, 35-11-215, and 35-11-230; and
(2) the financial condition and
responsibility, financial and business experience, competence, character, and
general fitness of the applicant; and the competence, experience, character,
and general fitness of the executive officers, managers, directors, and persons
in control of the applicant indicate that it is in the interest of the public
to permit the applicant to engage in money transmission.
(B) When an application for an
original license pursuant to this article is complete, the commissioner Commissioner promptly
shall notify the applicant in a record of the date on which the application was
determined to be complete and:
(1) the commissioner
Commissioner shall approve or deny the
application within one hundred twenty days after that date; or
(2) if the application is not approved
or denied within one hundred twenty days after that date the:
(a) application is considered
approved; and
(b) commissioner Commissioner shall issue the license pursuant to this
article, to take effect as of the first business day after expiration of the
one hundred twenty-day period.
(C) The commissioner
Commissioner may for good cause extend the
application period.
(D) A
determination by the Commissioner that an application is complete and is
accepted for processing means only that the application, on its face, appears
to include all of the items, including the Criminal Background Check response
from the FBI, and addresses all of the matters that are required, and is not an
assessment of the substance of the application or of the sufficiency of the
information provided.
(E) The Commissioner shall issue a
formal written notice of the denial of a license application. The Commissioner
shall set forth in the notice of denial the specific reasons for the denial of
the application. An applicant whose application
is denied by the commissioner Commissioner
pursuant to this article section may appealrequest a hearing, within thirty days after receipt of
the written notice of the denial, from the denial and request a hearing pursuant to Section 35-11-710.
(F) The initial license term begins on
the day the application is approved. The license expires on December thirty-first
of the year in which the license term began, unless the initial license date is
between November first and December thirty-first, in which instance the initial
license term runs through December thirty-first of the following year.
Section 35-11-225. (A)
A person licensed pursuant to this article shall pay an
annual renewal fee of seven hundred fifty dollars no later than thirty days
before the anniversary of the issuance of the license or, if the last day is
not a business day, on the next business day.license
issued under this chapter must be renewed annually.
(1) An annual renewal fee of one
thousand six hundred dollars must be paid no more than sixty days before the
license expiration.
(2) The renewal term must be for a
period of one year and begins on January first of each year after the initial
license term and expires on December thirty-first of the year the renewal term
begins.
(B) A licensee under this article
shall submit a renewal report with the renewal fee, in a form and in a medium
prescribed by the commissionerCommissioner.
The renewal report must state or contain:
(1) a
copy of the licensee's most recent audited annual financial statement or, if
the licensee is a wholly owned subsidiary of another corporation, the most
recent audited consolidated annual financial statement of the parent
corporation or the licensee's most recent audited consolidated annual financial
statement;
(2) the
number and monetary amount of payment instruments and stored value sold by the
licensee in this State which have not been included in a renewal report, and
the monetary amount of payment instruments and stored value currently
outstanding;
(3) a description
of each material change in information submitted by the licensee in its
original license application which has not been reported to the commissioner Commissioner on
a required report;
(4) a
list of the licensee's permissible investments and a certification that the
licensee continues to maintain permissible investments pursuant to the
requirements set forth in Sections 35-11-600 and 35-11-605;
(5)
proof that the licensee continues to maintain adequate security as required by
Section 35-11-215; and
(6) a
list of the locations in this State where the licensee or an authorized
delegate of the licensee engages in money transmission or provides other money
services.
(C) If a licensee
does not file a renewal report or pay its renewal fee by the renewal date or an
extension of time granted by the commissioner, the commissioner shall send the
licensee a notice of suspension. Unless the licensee files the report and pays
the renewal fee before expiration of ten days after the notice is sent, the
licensee's license is suspended ten days after the commissioner sends the
notice of suspension. The suspension must be lifted if, within twenty days
after its license is suspended, the licensee:
(1)
files the report and pays the renewal fee; and
(2)
pays one hundred dollars for each day after suspension that the commissioner
did not receive the renewal report and the renewal fee.
(D) The commissioner Commissioner for
good cause may grant an extension of the renewal date.
(D) The Commissioner is authorized and
encouraged to utilize NMLS to process license renewals provided that such
functionality is consistent with this section.
Section 35-11-230. A
person licensed pursuant to this article shall maintain a net worth of at least
two hundred fifty thousand dollars determined in accordance with generally
accepted accounting principles.(A) A licensee under this
chapter shall maintain at all times a tangible net worth of the greater of one
hundred thousand dollars or three percent of total assets for the first one
hundred million dollars, two percent of additional assets for one hundred million
dollars to one billion dollars, and one half of one percent of additional
assets for over one billion dollars.
(B) Tangible net worth must be
demonstrated at initial application by the applicant's most recent audited or
unaudited financial statements pursuant to Section 35-11-205(B)(6).
(C) Notwithstanding the foregoing
provisions of this section, the Commissioner shall have the authority, for good
cause shown, to exempt, in whole or in part, from the requirements of this
section any applicant or licensee.
Section 35-11-235. (A)
If a licensee does not continue to meet the qualifications or satisfy the
requirements that apply to an applicant for a new money transmission license,
the Commissioner may suspend or revoke the licensee's license pursuant to
Section 35-11-700 or 35-11-710 or other applicable state law for such
suspension or revocation.
(B) An applicant for a money
transmission license must demonstrate that it meets or will meet, and a money
transmission licensee must at all times meet, the requirements in Sections
35-11-215, 35-11-230 and 35-11-600 of this chapter.
Article 3
Currency
Exchange Licenses
Section 35-11-300. (A)
A person may not engage in currency exchange or advertise, solicit, or hold
himself out as providing currency exchange for which the person receives
revenues equal or greater than five percent of total revenues unless the person
is:
(1) licensed pursuant to this chapterarticle;
(2) licensed for money transmission
pursuant to Article 2, or approved to engage in money
transmission pursuant to Section 35-11-210; or
(3) an authorized delegate of a person
licensed pursuant to Article 2; or.
(4) an
authorized delegate of a person approved to engage in money transmission
pursuant to Section 35-11-210.
(B) A license issued pursuant to this
chapter is not transferable or assignable.
Section 35-11-305. (A)
A person applying for a license pursuant to this article shall do so in a form
and in a medium prescribed by the commissionerCommissioner. The application shall state or contain:
(1) the legal name and residential and
business addresses of the applicant, if the applicant is an individual or, if
the applicant is not an individual, the name of each partner, executive
officer, manager, and director;
(2) the location of the principal
office of the applicant;
(3) complete addresses of other
locations in this State where the applicant proposes to engage in currency
exchange, including all limited stations and mobile locations; and
(4) a
description of the source of money and credit to be used by the applicant to
engage in currency exchange; and
(5)(4) other information the commissioner
Commissioner reasonably requires with
respect to the applicant, but not more than the commissioner
Commissioner may require pursuant to Article
2.
(B) A nonrefundable application fee of
one thousand five hundred dollars and a license fee of seven
hundred fiftyone thousand six hundred
dollars must accompany an application for a license pursuant to this article.
The license fee must be refunded if the application is denied.
(C) The Commissioner may waive one or
more requirements of subsection (A) or permit an applicant to submit other
information in lieu of the required information.
Section 35-11-310. (A)
When a person applies for a license pursuant to this article, the commissioner Commissioner shall
investigate the applicant's financial condition and responsibility, financial
and business experience, character, and general fitness. The commissioner Commissioner may
conduct an on-site investigation of the applicant, the reasonable cost of which
the applicant must pay. The commissioner Commissioner shall issue a license to an applicant
pursuant to this article if the commissioner Commissioner finds that all of the following conditions
have been fulfilled:
(1) the applicant has complied with
Section 35-11-305; and
(2) the financial condition and
responsibility, financial and business experience, competence, character, and
general fitness of the applicant; and the competence, experience, character,
and general fitness of the executive officers, managers, directors, and persons
in control of the applicant indicate that it is in the interest of the public
to permit the applicant to engage in currency exchange.
(B) When an application for an
original license pursuant to this article is complete, the commissioner Commissioner promptly
shall notify the applicant in a record of the date on which the application was
determined to be complete and:
(1) the commissioner
Commissioner shall approve or deny the
application within one hundred twenty days after that date; or
(2) if the application is not approved
or denied within one hundred twenty days after that date the:
(a) application is considered
approved; and
(b) commissioner Commissioner shall issue the license pursuant to this
article, to take effect as of the first business day after expiration of the
period.
(C) The commissioner
Commissioner may for good cause extend the
application period.
(D) The
Commissioner shall issue a formal written notice of the denial of a license.
The Commissioner shall set forth in the notice of denial the specific reasons
for the denial of the application. An applicant whose application is
denied a license by the commissioner Commissioner pursuant to this article may appealrequest a hearing,
within thirty days after receipt of the written
notice of the denial pursuant to Section 35-11-710, from the denial and request a hearing.
Section 35-11-315. (A)
A person licensed pursuant to this article shall pay a
biennial renewal fee of seven hundred fifty dollars no later than thirty days
before each biennial anniversary of the issuance of the license or, if the last
day is not a business day, on the next business day. All licenses issued pursuant to this article expire on December
thirty-first of each year. A person licensed pursuant to this article shall pay
a renewal fee of one thousand six hundred dollars on or before December first
of each year.
(B) A person licensed pursuant to this
article shall submit a renewal report with the renewal fee, in a form and in a
medium prescribed by the commissionerCommissioner. The renewal report must state or contain a:
(1) description of each material
change in information submitted by the licensee in its original license
application which has not been reported to the commissioner
Commissioner on a required report; and
(2) list of the locations in this
State where the licensee or an authorized delegate of the licensee engages in
currency exchange, including limited stations and mobile locations.
(C) If a
licensee does not file a renewal report and pay its renewal fee by the renewal
date or an extension of time granted by the commissioner, the commissioner
shall send the licensee a notice of suspension. Unless the licensee files the
report and pays the renewal fee before expiration of ten days after the notice
is sent, the licensee's license is suspended ten days after the commissioner
sends the notice of suspension.
(D)(C) The commissioner Commissioner for good cause may grant an extension of the
renewal date.
Article 4
Authorized
Delegates
Section 35-11-400. (A)
In this section, "remit" means to make direct payments of money to a licensee
or its representative authorized to receive money or to deposit money in a bank
in an account specified by the licensee.
(B) A contract
between a licensee and an authorized delegate must require the authorized
delegate to operate in full compliance with this chapter. For such contracts
initiated on or after the effective date of this act, the licensee shall
provide to each authorized delegate information sufficient for compliance with
this chapter.Before a licensee is authorized to
conduct business through an authorized delegate or allows a person to act as
the licensee's authorized delegate, the licensee must:
(1) adopt, and update as necessary,
written policies and procedures reasonably designed to ensure that the licensee's
authorized delegates comply with applicable state and federal law;
(2) enter into a written contract that
complies with Section 35-11-400(D); and
(3) conduct a reasonable risk-based
background investigation sufficient for the licensee to determine whether the
authorized delegate has complied and will likely comply with applicable state
and federal law.
(C) An authorized
delegate shall remit all money owing to the licensee in accordance with the
terms of the contract between the licensee and the authorized delegate.An authorized delegate must operate in full compliance with this
chapter.
(D) If a license
is suspended or revoked or a licensee does not renew its license, the
commissioner shall notify all authorized delegates of the licensee whose names
are in a record filed with the commissioner of the suspension, revocation, or
nonrenewal. After notice is sent or publication is made, an authorized delegate
shall immediately cease to provide money services as a delegate of the
licensee.The written contract required by Section
35-11-400(B) must be signed by the licensee and the authorized delegate and, at
a minimum, must:
(1) appoint the person signing the contract as the licensee's
authorized delegate with the authority to conduct money transmission on behalf
of the licensee;
(2) set forth the nature and scope of
the relationship between the licensee and the authorized delegate and the
respective rights and responsibilities of the parties;
(3) require the authorized delegate to
agree to fully comply with all applicable state and federal laws, rules, and
regulations pertaining to money transmission, including this chapter and
regulations implementing this chapter, relevant provisions of the Bank Secrecy
Act and the USA Patriot Act;
(4) require the authorized delegate to
remit and handle money and monetary value in accordance with the terms of the
contract between the licensee and the authorized delegate;
(5) impose a trust on money and
monetary value net of fees received for money transmission for the benefit of
the licensee;
(6) require the authorized delegate to
prepare and maintain records as required by this chapter or regulations
implementing this chapter, or as reasonably requested by the Commissioner;
(7) acknowledge that the authorized
delegate consents to examination or investigation by the Commissioner;
(8) state that the licensee is subject
to regulation by the Commissioner and that, as part of that regulation, the
Commissioner may suspend or revoke an authorized delegate designation or
require the licensee to terminate an authorized delegate designation; and
(9) acknowledge receipt of the written
policies and procedures required under Section 35-11-400(B)(1).
(E) An authorized
delegate may not provide money services outside the scope of activity
permissible under the contract between the authorized delegate and the
licensee, except activity in which the authorized delegate is authorized to
engage in pursuant to Article 2 of this chapter. An authorized delegate of a
licensee holds in trust for the benefit of the licensee all money net of fees
received from money transmission.If the licensee's
license is suspended, revoked, surrendered, or expired, the licensee must,
within five business days, provide documentation to the Commissioner that the
licensee has notified all applicable authorized delegates of the licensee whose
names are in a record filed with the Commissioner of the suspension,
revocation, surrender, or expiration of a license. Upon suspension, revocation,
surrender, or expiration of a license, applicable authorized delegates shall
immediately cease to provide money transmission as an authorized delegate of
the licensee.
(F) An authorized delegate of a licensee holds in trust for the
benefit of the licensee all money net of fees received from money transmission.
If any authorized delegate commingles any funds received from money
transmission with any other funds or property owned or controlled by the
authorized delegate, all commingled funds and other property shall be
considered held in trust in favor of the licensee in an amount equal to the
amount of money net of fees received from money transmission.
(F)(G) An authorized delegate may not use a subdelegate to
conduct money services on behalf of a licensee.
Section 35-11-405. A person may not provide
money services on behalf of a person not licensed pursuant to this chapter or not exempt pursuant to Section 35-11-110. A person
that engages in that activity provides money services to the same extent as if
the person were a licensee and is jointly and severally
liable with the unlicensed or nonexempt person.
Article 5
Examinations,
Reports, and Records
Section 35-11-500. (A)
The commissioner Commissioner may
conduct an annual examination
or investigation of a licensee or of any of the licensee's authorized
delegates on a forty-five day notice in a record to the
licenseeor otherwise take independent action
authorized by this chapter or by a rule or order issued under this chapter as
reasonably necessary or appropriate to administer and enforce this chapter,
regulations implementing this chapter, and other applicable law, including the
Bank Secrecy Act and the USA Patriot Act. The Commissioner may:
(1) conduct an examination either
on-site or off-site as the Commissioner may reasonably require;
(2) conduct an examination in
conjunction with an examination conducted by representatives of other state
agencies or agencies of another state or of the federal government;
(3) accept the examination report of
another state agency or an agency of another state or of the federal
government, or a report prepared by an independent accounting firm, which on
being accepted is considered for all purposes as an official report of the Commissioner;
and
(4) summon and examine under oath a
key individual or employee of a licensee or authorized delegate and require the
person to produce records regarding any matter related to the condition and
business of the licensee or authorized delegate.
(B) The
commissioner may examine a licensee or its authorized delegate, at any time,
without notice, if the commissioner has reason to believe that the licensee or
authorized delegate is engaging in an unsafe or unsound practice or has
violated or is violating this chapter or a rule adopted or an order issued
pursuant to this chapter.A licensee or authorized
delegate shall provide, and the Commissioner shall have full and complete
access to, all records the Commissioner may reasonably require to conduct a complete
examination. The records must be provided at the location and in the format
specified by the Commissioner, provided, the Commissioner may utilize
multistate record production standards and examination procedures when such
standards will reasonably achieve the requirements of this section.
(C) If the commissioner
Commissioner concludes that an on-site examination is necessary pursuant to subsection
(A), the licensee shall pay the reasonable cost of the examination.
(D) Information obtained during an examination
pursuant to this chapter may be disclosed only as provided in Section
35-11-530.
Section 35-11-505. The
commissioner may consult and cooperate with other state money services
regulators in enforcing and administering this act. They jointly may pursue
examinations and take other official action that they are otherwise empowered
to take.(A) To efficiently and effectively administer and enforce this
chapter and to minimize regulatory burden, the Commissioner is authorized and
encouraged to participate in multistate supervisory processes established
between states and coordinated through the Conference of State Bank
Supervisors, Money Transmitter Regulators Association, and affiliates and
successors thereof for all licensees that hold licenses in this State and other
states. As a participant in multistate supervision, the Commissioner shall:
(1) cooperate, coordinate, and share
information with other state and federal regulators in accordance with Section
35-11-530;
(2) enter into written cooperation,
coordination, or information-sharing contracts or agreements with organizations
the membership of which is made up of state or federal governmental agencies;
and
(3) cooperate, coordinate, and share
information with organizations the membership of which is made up of state or
federal governmental agencies, provided that the organizations agree in writing
to maintain the confidentiality and security of the shared information in
accordance with Section 35-11-530.
(B) The Commissioner may not waive,
and nothing in this section constitutes a waiver of, the Commissioner's
authority to conduct an examination or investigation or otherwise take
independent action authorized by this chapter, or a rule adopted or order
issued under this chapter, to enforce compliance with applicable state or
federal law.
(C) A joint examination or
investigation, or acceptance of an examination or investigation report, does
not waive an examination assessment provided for in this chapter.
Section 35-11-510. (A)
A licensee shall file with the commissioner Commissioner within fifteen business days any material
changes in information provided in a licensee's application as prescribed by
the commissionerCommissioner.
(B) A licensee
shall file with the commissioner within forty-five days after the end of each
fiscal quarter a current list of all authorized delegates, and locations in
this State where the licensee or an authorized delegate of the licensee
provides money services, including limited stations and mobile locations. The
licensee shall state the name and street address of each location and
authorized delegate. Each licensee shall submit a
report of authorized delegates within forty-five days of the end of the calendar
quarter. The Commissioner is authorized and encouraged to utilize NMLS for the
submission of the report required by this subsection provided that such
functionality is consistent with the requirements of this subsection. The
authorized delegate report must include, at a minimum, each authorized delegate's:
(1) company legal name;
(2) taxpayer employer identification
number;
(3) principal provider identifier;
(4) physical address;
(5) mailing address;
(6) any business conducted in other
states;
(7) any fictitious or trade name;
(8) contact person's name, phone
number, and email;
(9) start date as licensee's
authorized delegate;
(10) end date acting as licensee's
authorized delegate, if applicable; and
(11) any other information the
Commissioner reasonably requires with respect to the authorized delegate.
(C) A licensee shall file a report
with the commissioner Commissioner
within three one business
days day after the
licensee has reason to know of the occurrence of any of the following events:
(1) the filing of a petition by or
against the licensee under the United States Bankruptcy Code, 11 U.S.C. Section
101-110 (1994 & Supp. V 1999)as amended or recodified from time to time, for
bankruptcy or reorganization;
(2) the filing of a petition by or
against the licensee for receivership, the commencement of another judicial or
administrative proceeding for its dissolution or reorganization, or the making
of a general assignment for the benefit of its creditors;
or
(3) the commencement of a proceeding
to revoke or suspend its license in a state or country in which the licensee
engages in business or is licensed;.
(4) the
cancellation or other impairment of the licensee's bond or other security;
(D) A licensee shall file a report
with the Commissioner within three business days after the licensee has reason
to know of the occurrence of any of the following events:
(5)(1) a charge or conviction of the licensee or of an executive officer, manager, director,a key individual or person in control of the licensee for
a felony; or
(6)(2) a charge or conviction of an authorized delegate for a
felony.
(E) Each licensee shall submit a
report of condition within forty-five days of the end of the calendar quarter,
or within any extended time as the Commissioner may prescribe. The report of
condition must include:
(1) financial information at the
licensee level;
(2) nationwide and state-specific
money transmission transaction information in every jurisdiction in the United
States where the licensee is licensed to engage in money transmission;
(3) permissible investments report;
(4) transaction destination country
reporting for money received for transmission, if applicable, which shall only
be included in a report of condition submitted within forty-five days of the
end of the fourth calendar quarter; and
(5) any other information the
Commissioner reasonably requires with respect to the licensee. The Commissioner
is authorized and encouraged to utilize NMLS for the submission of the report
required by this subsection and is authorized to change or update as necessary
the requirements of this subsection to carry out the purposes of this chapter
and maintain consistency with NMLS reporting.
(F) Each licensee, within ninety days
after the end of each fiscal year, or within any extended time as the
Commissioner may prescribe, shall file with the Commissioner:
(1) an audited financial statement of
the licensee for the fiscal year prepared in accordance with United States
generally accepted accounting principles, prepared by an independent certified
public accountant or independent public accountant who is satisfactory to the
Commissioner, which must include or be accompanied by a certificate of opinion
of the independent certified public accountant or independent public accountant
that is satisfactory in form and content to the Commissioner. If the
certificate or opinion is qualified, the Commissioner may order the licensee to
take any action as the Commissioner may find necessary to enable the
independent or certified public accountant or independent public accountant to
remove the qualification; and
(2) any other information as the
Commissioner may reasonably require.
Section 35-11-515. (A)
A licensee shall:
(1)
give the commissioner notice in a record of a proposed change of control within
fifteen days after learning of the proposed change of control;
(2)
request approval of the acquisition; and
(3)
submit a nonrefundable fee of one thousand dollars with the notice.
(B) After
review of a request for approval pursuant to subsection (A), the commissioner
may require the licensee to provide additional information concerning the
proposed persons in control of the licensee. The additional information must be
limited to the same types required of the licensee or persons in control of the
licensee as part of its original license or renewal application.
(C) The
commissioner shall approve a request for change of control pursuant to
subsection (A) if, after investigation, the commissioner determines that the
person or group of persons requesting approval has the competence, experience,
character, and general fitness to operate the licensee or person in control of
the licensee in a lawful and proper manner and that the public interest will
not be jeopardized by the change of control.
(D) When
an application for a change of control pursuant to this article is complete,
the commissioner shall notify the licensee in a record of the date on which the
request was determined to be complete and:
(1) the
commissioner shall approve or deny the request within one hundred twenty days
after that date; or
(2) if
the request is not approved or denied within one hundred twenty days after that
date:
(a)
the request is considered approved; and
(b)
the commissioner shall permit the change of control under this section to take
effect as of the first business day after expiration of the period.
(E) The
commissioner, by rule of order, may exempt a person from any of the
requirements of subsection (A)(2) and (3) if it is in the public interest to do
so.
(F)
Subsection (A) does not apply to a public offering of securities.
(G) Before
filing a request for approval to acquire control of a licensee or person in
control of a licensee, a person may request in a record a determination from
the commissioner as to whether the person would be considered a person in
control of a licensee upon consummation of a proposed transaction. If the
commissioner determines that the person would not be a person in control of a
licensee, the commissioner shall enter an order to that effect and the proposed
person and transaction is not subject to the requirements of subsections (A)
through (C). Any person,
or group of persons acting in concert, seeking to acquire control of a licensee
shall obtain the written approval of the Commissioner prior to acquiring
control. An individual is not deemed to acquire control of a licensee and is
not subject to these acquisition of control provisions when that individual
becomes a key individual in the ordinary course of business.
(B) A person, or group of persons
acting in concert, seeking to acquire control of a licensee, in cooperation
with the licensee, shall:
(1) submit an application in a form
and in a medium prescribed by the Commissioner; and
(2) submit a nonrefundable fee of one
thousand dollars with the request for approval.
(C) Upon request, the Commissioner may
permit a licensee or the person, or group of persons acting in concert, to
submit some or all information required by the Commissioner pursuant to Section
35-11-515(B)(1) without using NMLS.
(D) The application required by
Section 35-11-515(B)(1) must include information required by Section 35-11-210
for any new key individuals that have not previously completed the requirements
of Section 35-11-210 for a licensee.
(E) When an application for
acquisition of control under this section appears to include all the items and
addresses all of the matters that are required, the application must be
considered complete and the Commissioner shall promptly notify the applicant in
a record of the date on which the application was determined to be complete
and:
(1) the Commissioner shall approve or
deny the application within sixty days after the completion date; or
(2) if the application is not approved
or denied within sixty days after the completion date:
(a) the application is approved;
(b) the person, or group of persons
acting in concert, are not prohibited from acquiring control; and
(c) the Commissioner may for good
cause extend the application period.
(F) A determination by the
Commissioner that an application is complete and is accepted for processing
means only that the application, on its face, appears to include all of the
items and address all of the matters that are required, and is not an assessment
of the substance of the application or of the sufficiency of the information
provided.
(G) When an application is filed and
considered complete under subsection (E), the Commissioner shall investigate
the financial condition and responsibility, financial and business experience,
character, and general fitness of the person, or group of persons acting in
concert, seeking to acquire control. The Commissioner shall approve an
acquisition of control pursuant to this section if the Commissioner finds that
all of the following conditions have been fulfilled:
(1) the requirements of subsections
(B) and (D) have been met, as applicable; and
(2) the financial condition and
responsibility, financial and business experience, competence, character, and
general fitness of the person, or group of persons acting in concert, seeking
to acquire control; and the competence, experience, character, and general
fitness of the key individuals and persons that would be in control of the
licensee after the acquisition of control indicate that it is in the interest
of the public to permit the person, or group of persons acting in concert, to
control the licensee.
(H) The Commissioner shall issue a
formal written notice of the denial of an application to acquire control within
thirty days of the decision to deny the application. The Commissioner shall set
forth in the notice of denial the specific reasons for the denial of the
application. An applicant whose application is denied by the Commissioner under
this section may request a hearing within thirty days after receipt of the
written notice of the denial pursuant to Section 35-11-710.
(I) The requirements of subsections
(A) and (B) do not apply to any of the following:
(1) a person that acts as a proxy for
the sole purpose of voting at a designated meeting of the shareholders or
holders of voting shares or voting interests of a licensee or a person in
control of a licensee;
(2) a person that acquires control of
a licensee by devise or descent;
(3) a person that acquires control of
a licensee as a personal representative, custodian, guardian, conservator, or
trustee, or as an officer appointed by a court of competent jurisdiction or by
operation of law;
(4) a person that is exempt under
Section 35-11-110(A)(4);
(5) a person that the Commissioner
determines is not subject to subsection (A) based on the public interest;
(6) a public offering of securities of
a licensee or a person in control of a licensee; or
(7) an internal reorganization of a
person in control of the licensee where the ultimate person in control of the
licensee remains the same.
(J) Persons in subsection (I)(2), (3),
(4), (6), and (7), in cooperation with the licensee, shall notify the
Commissioner within fifteen days after the acquisition of control.
(K)(1) The requirements of subsections
(A) and (B) do not apply to a person that has complied with and received
approval to engage in money transmission under this chapter or was identified
as a person in control in a prior application filed with and approved by the
Commissioner or by an MSB-accredited state pursuant to a multistate licensing
process, provided that:
(a) the person has not had a license
revoked or suspended or controlled a licensee that has had a license revoked or
suspended while the person was in control of the licensee in the previous five
years;
(b) if the person is a licensee, the
person is well managed and has received at least a satisfactory rating for
compliance at its most recent examination by an MSB-accredited state if such
rating was given;
(c) the licensee to be acquired is
projected to meet the requirements of Sections 35-11-215, 35-11-230, and
35-11-600 after the acquisition of control is completed, and if the person
acquiring control is a licensee, that licensee is also projected to meet the
requirements of Sections 35-11-215, 35-11-230, and 35-11-600 after the
acquisition of control is completed;
(d) the licensee to be acquired will
not implement any material changes to its business plan as a result of the
acquisition of control, and if the person acquiring control is a licensee, that
licensee also will not implement any material changes to its business plan as a
result of the acquisition of control; and
(e) the person provides notice of the
acquisition in cooperation with the licensee and attests to subsection
(K)(1)(a), (b), (c), and (d) in a form and in a medium prescribed by the
Commissioner.
(2) If the notice is not disapproved
within thirty days after the date on which the notice was determined to be
complete, the notice is deemed approved.
(L) Before filing an application for
approval to acquire control of a licensee a person may request in writing a
determination from the Commissioner as to whether the person would be
considered a person in control of a licensee upon consummation of a proposed
transaction. If the Commissioner determines that the person would not be a
person in control of a licensee, the proposed person and transaction is not
subject to the requirements of subsections(A) and (B).
(M)(1) A licensee adding or replacing any
key individual shall:
(a) provide notice in a manner
prescribed by the Commissioner within fifteen days after the effective date of
the key individual's appointment; and
(b) provide information as required by
Section 35-11-210 within forty-five days of the effective date.
(2) Within ninety days of the date on which
the notice provided pursuant to item (1) was determined to be complete, the
Commissioner may issue a notice of disapproval of a key individual if the
competence, experience, character, or integrity of the individual would not be
in the best interest of the public or the customers of the licensee to permit
the individual to be a key individual of such licensee.
(3) A notice of disapproval must
contain a statement of the basis for disapproval and must be sent to the
licensee and the disapproved individual. A licensee may request a hearing
regarding a notice of disapproval, within thirty days after receipt of such notice
of disapproval pursuant to Section 35-11-710.
(4) If the notice provided pursuant to
item (1) is not disapproved within ninety days after the date on which the
notice was determined to be complete, the key individual is deemed approved.
Section 35-11-520. (A)
A licensee shall maintain the following records for determining its compliance
with this act chapter for
at least three years:
(1) a record of each payment instrument or stored-valueoutstanding
money transmission obligation sold;
(2) a general ledger posted at least
monthly containing all asset, liability, capital, income, and expense accounts;
(3) bank statements and bank
reconciliation records;
(4) records of outstanding payment instruments and stored-valuemoney
transmission obligations;
(5) records of each payment instrument and stored-valuemoney
transmission obligation paid within the three-year period;
(6) a list of the last known names and
addresses of all of the licensee's authorized delegates; and
(7) other records the commissioner Commissioner reasonably
requires by rule.
(B) The items specified in subsection
(A) may be maintained in any form of record.
(C) Records may be maintained outside
this State if they are made accessible to the commissioner
Commissioner on a seven business-day notice
that is sent in a record.
(D) All records maintained by the
licensee as required in subsections (A) through (C) are open to inspection by
the commissioner Commissioner pursuant
to Section 35-11-500.
Section 35-11-525. (A)
A licensee and an authorized delegate shall file with the commissioner
Commissioner all reports required by federal
currency reporting, record keeping, and suspicious transaction reporting
requirements as set forth in 31 U.S.C. Section 5311
(1994), 31 C.F.R. Section 103 (2000)the Bank
Secrecy Act and other federal and state laws pertaining to money
laundering.
(B) The timely filing of a complete
and accurate report required pursuant to subsection (A) with the appropriate
federal agency is in compliance with the requirements of subsection (A), unless
the commissioner Commissioner notifies
the licensee that reports of this type are not being regularly and
comprehensively transmitted by the federal agency to the commissionerCommissioner.
Section 35-11-530. (A)
Unless otherwise specified in this section, all
information filed with the Securities Commissioner shall be available for
public inspection pursuant to rules promulgated by the commissioner consistent
with state and federal law governing the disclosure of public information. Except as otherwise provided in subsection (B), all information
or reports obtained by the Commissioner from an applicant, licensee, or
authorized delegate, and all information contained in or related to an
examination, investigation, operating report, or condition report prepared by,
on behalf of, or for the use of the Commissioner, or financial statements,
balance sheets, or authorized delegate information, are confidential and are
not subject to disclosure under Section 30-4-10, et seq.
(B) Except for
reasonably segregable portions of information and records that by law would
routinely be made available to a party other than an agency in litigation with
the commissioner, the commissioner shall not publish or make available:
(1)
information contained in reports, summaries, analyses, letters, or memoranda
arising out of, in anticipation of, or in connection with an investigation,
examination, or inspection of the books and records of a person;
(2)
interagency or intra-agency memoranda or letters, including without limitation:
(a)
records that reflect discussions between or consideration by the commissioner
or members of the commissioner's staff, or both, of an action taken or proposed
to be taken by the commissioner or by a member of the commissioner's staff; and
(b)
reports, summaries, analyses, conclusions, or any other work product of the
commissioner or of attorneys, accountants, analysts, or other members of the
commissioner's staff, prepared in the course of an:
(i)
inspection of the books or records of a person whose affairs are regulated by
the commissioner; or
(ii)
examination, investigation, or litigation conducted by or on behalf of the
commissioner;
(3)
personnel files, medical files, and similar files if disclosure would
constitute a clearly unwarranted invasion of personal privacy, including
without limitation:
(a)
information concerning all employees of the South Carolina Securities Division
and all persons subject to regulation by the division; and
(b)
personal information reported to the commissioner under the division's rules
concerning registration about employees of applicants, licensees, or their
agents;
(4)(a)
investigatory records compiled for law enforcement purposes to the extent that
production of the records would:
(i)
interfere with enforcement proceedings;
(ii)
deprive a person of a right to a fair trial or an impartial adjudication; or
(iii)
disclose the identity of a confidential source;
(b)
the commissioner also may withhold investigatory records that would:
(i)
constitute an unwarranted invasion of personal privacy;
(ii)
disclose investigative techniques and procedures; or
(iii)
endanger the life or physical safety of law enforcement personnel;
(c)
as used in this section, "investigatory records" includes:
(i)
all documents, records, transcripts, correspondence, and related memoranda and
work products concerning examinations and other investigations and related
litigation as authorized by law that pertain to or may disclose the possible
violation by a person of a provision of the statutes or rules administered by
the commissioner; and
(ii)
all written communications from or to a person confidentially complaining or
otherwise furnishing information about a possible violation, as well as all
correspondence and memoranda in connection with the confidential complaint or
information;
(5)
information contained in or related to examinations, operating reports, or
condition reports prepared by, on behalf of, or for the use of an agency
responsible for the regulation or supervision of financial institutions, check
issuers, money transmitters, money services providers, or money service
businesses;
(6)(a)
financial records of an applicant, licensee, or the agent of an applicant or
licensee obtained during or as a result of an examination by the commissioner;
(b)
when a record is required to be filed pursuant to this article with the
commissioner as part of an application for license, annual renewal, or
otherwise, the record, including financial statements prepared by certified
public accountants, must be public information unless sections of the
information are bound separately and are marked "confidential" by the
applicant, licensee, or agent upon filing;
(c)
information pursuant to subitem (b) bound separately and marked "confidential"
must be considered nonpublic until ten days after the commissioner has given
the applicant, licensee, or agent notice that an order will be entered finding
the material public information.
(d)
an applicant, licensee, or agent may seek an injunction from the Richland
County Circuit Court ordering the commissioner to withhold the information as
nonpublic pending a final order from a court of competent jurisdiction if the
order of the commissioner pursuant to subitem (c) is appealed under applicable
law;
(7)
trade secrets obtained from a person; or
(8)
another record that is required to be closed to the public and is not
considered open to public inspection under other law.The Commissioner may disclose information not
otherwise subject to disclosure under subsection (A) to representatives of
state or federal agencies who promise in a record that they will maintain the
confidentiality of the information or where the Commissioner finds that the
release is reasonably necessary for the protection and interest of the public
in accordance with Section 30-4-10, et seq.
(C) The
commissioner may disclose information not otherwise subject to disclosure
pursuant to subsection (A) to representatives of state or federal agencies who
promise in a record that they will maintain the confidentiality of the
information; or the commissioner finds that the release is reasonably
necessary for the protection of the public and in the interests of justice, and
the licensee has been given previous notice by the commissioner of the
commissioner's intent to release the information.
(D)(C) This section does not prohibit the commissioner from
disclosing to the public a list of persons licensed under this chapter or the
aggregated financial data concerning those licensees.
(D) Information contained in the
records of the Commissioner that is not confidential and may be made available
to the public either on the Commissioner's website, upon receipt by the
Commissioner of a written request, or in NMLS must include:
(1) the name, business address,
telephone number, and unique identifier of a licensee;
(2) the business address of a licensee's
registered agent for service;
(3) the name, business address, and
telephone number of all authorized delegates;
(4) the terms of or a copy of any bond
filed by a licensee, provided that confidential information including, but not
limited to, prices and fees for such bond is redacted;
(5) copies of any nonconfidential
final orders of the Commissioner relating to any violation of this chapter or
regulations implementing this chapter; and
(6) imposition of an administrative
fine or penalty under this chapter.
Section 35-11-535. (A)
Every licensee shall forward all money received for transmission in accordance
with the terms of the agreement between the licensee and the sender unless the
licensee has a reasonable belief or a reasonable basis to believe that the
sender may be a victim of fraud or that a crime or violation of law, rule, or
regulation has occurred, is occurring, or may occur.
(B) If a licensee fails to forward
money received for transmission in accordance with this section, the licensee
must respond to inquiries by the sender with the reason for the failure unless
providing a response would violate a state or federal law, rule, or regulation.
Section 35-11-540. (A)
This section does not apply to:
(1) money received for transmission
subject to the federal Remittance Rule, 12 C.F.R. Part 1005, Subpart B, as
amended or recodified from time to time; or
(2) money received for transmission
pursuant to a written agreement between the licensee and payee to process
payments for goods or services provided by the payee.
(B) Every licensee shall refund to the
sender within ten days of receipt of the sender's written request for a refund
of any and all money received for transmission unless any of the following
occurs:
(1) the money has been forwarded
within ten days of the date on which the money was received for transmission;
(2) instructions have been given
committing an equivalent amount of money to the person designated by the sender
within ten days of the date on which the money was received for transmission;
(3) the agreement between the licensee
and the sender instructs the licensee to forward the money at a time that is
beyond ten days of the date on which the money was received for transmission.
If funds have not yet been forwarded in accordance with the terms of the
agreement between the licensee and the sender, the licensee shall issue a
refund in accordance with the other provisions of this section;
(4) the refund is requested for a
transaction that the licensee has not completed based on a reasonable belief or
a reasonable basis to believe that a crime or violation of law, rule, or
regulation has occurred, is occurring, or may occur; or
(5) the refund request does not enable
the licensee to:
(a) identify the sender's name and
address or telephone number; or
(b) identify the particular
transaction to be refunded in the event the sender has multiple transactions
outstanding.
Section 35-11-545. (A)
This section does not apply to:
(1) money received for transmission
subject to the federal Remittance Rule, 12 C.F.R. Part 1005, Subpart B, as
amended or recodified from time to time;
(2) money received for transmission
that is not primarily for personal, family, or household purposes;
(3) money received for transmission
pursuant to a written agreement between the licensee and payee to process
payments for goods or services provided by the payee; or
(4) payroll processing services.
(B) For purposes of this article, "receipt"
means a paper receipt, electronic record, or other written confirmation. For a
transaction conducted in person, the receipt may be provided electronically if
the sender requests or agrees to receive an electronic receipt. For a
transaction conducted electronically or by phone, a receipt may be provided
electronically. All electronic receipts shall be provided in a retainable form.
(C) Every licensee or its authorized
delegate shall provide the sender a receipt for money received for
transmission.
(1) The receipt must contain the
following information, as applicable:
(a) the name of the sender;
(b) the name of the designated
recipient;
(c) the date of the transaction;
(d) the unique transaction or
identification number;
(e) the name of the licensee, NMLS
Unique ID, the licensee's business address, and the licensee's customer service
telephone number;
(f) the amount of the transaction in
United States dollars;
(g) any fee charged by the licensee to
the sender for the transaction; and
(h) any taxes collected by the
licensee from the sender for the transaction.
(2) The receipt required by this section
shall be in English and in the language principally used by the licensee or
authorized delegate to advertise, solicit, or negotiate, either orally or in
writing, for a transaction conducted in person, electronically or by phone, if
other than English.
Section 35-11-550. Every licensee or
authorized delegate shall include on a receipt or disclose on the licensee's
website or mobile application the name and phone number of the South Carolina Office
of Attorney General and a statement that the licensee's customers can contact
the Commissioner with complaints about the licensee's money transmission
services.
Section 35-11-555. (A)
A licensee that provides payroll processing services shall:
(1) issue reports to clients detailing
client payroll obligations in advance of the payroll funds being deducted from
an account; and
(2) make available worker paystubs or
an equivalent statement to workers.
(B) This section does not apply to a
licensee providing payroll processing services where the licensee's client
designates the intended recipients to the licensee and is responsible for
providing the disclosures required by Subsection (A)(2).
Article 6
Permissible
Investments
Section 35-11-600. (A)
A licensee shall maintain at all times permissible investments that have a
market value computed in accordance with generally accepted accounting
principles of not less than the aggregate amount of all of its outstanding payment instruments and store-value obligations issued or sold
in all states and money transmitted from all states by the licenseemoney transmission obligation.
(B) Except for
permissible investments enumerated in Section 35-11-605(A), The commissionerthe Commissioner,
with respect to a any licensee,
may, by rule or order, limit the extent to which a type of specific investment maintained by a licensee within a class of permissible
investments may be considered a permissible investment, except
for money and certificates of deposit issued by a bank. The commissioner by
rule may prescribe or by order allow other types of investments that the
commissioner determines to have a safety substantially equivalent to other
permissible investmentsif the specific investment
represents undue risk to customers, not reflected in the market value of the
investments.
(C) Permissible investments, even if
commingled with other assets of the licensee, are held in trust for the benefit
of the purchasers and holders of the licensee's outstanding
payment instruments and stored-valuemoney
transmission obligations in the event of bankruptcy
or receivership of the licensee insolvency, the
filing of a petition by or against the licensee under the United States
Bankruptcy Code, 11 U.S.C. Section 101-110, as amended or recodified from time
to time, for bankruptcy or reorganization, the filing of a petition by or
against the licensee for receivership, the commencement of any other judicial
or administrative proceeding for its dissolution or reorganization, or in the
event of an action by a creditor against the licensee who is not a beneficiary
of this statutory trust. No permissible investments impressed with a trust
pursuant to this section may be subject to attachment, levy of execution, or
sequestration by order of any court, except for a beneficiary of this statutory
trust.
(D) Upon the establishment of a
statutory trust in accordance with subsection (C) or when any funds are drawn
on a letter of credit pursuant to Section 35-11-605(A)(4), the Commissioner
shall notify the applicable regulator of each state in which the licensee is
licensed to engage in money transmission, if any, of the establishment of the
trust or the funds drawn on the letter of credit, as applicable. Notice is
deemed satisfied if performed pursuant to a multistate agreement or through
NMLS. Funds drawn on a letter of credit, and any other permissible investments
held in trust for the benefit of the purchasers and holders of the licensee's
outstanding money transmission obligations, are deemed held in trust for the
benefit of such purchasers and holders on a pro rata and equitable basis in
accordance with statutes pursuant to which permissible investments are required
to be held in this State, and other states, as applicable. Any statutory trust
established hereunder must be terminated upon extinguishment of all of the
licensee's outstanding money transmission obligations.
(E) The Commissioner, by regulation or
by order, may allow other types of investments that the Commissioner determines
are of sufficient liquidity and quality to be a permissible investment. The
Commissioner is authorized to participate in efforts with other state
regulators to determine that other types of investments are of sufficient
liquidity and quality to be a permissible investment.
Section 35-11-605. (A)
Except to the extent otherwise limited by the commissioner
pursuant to Section 35-11-600, theThe
following investments are permissible pursuant to Section 35-11-600:
(1) cash, a
certificate of deposit, or senior debt obligation of an insured depositary
institution, as defined in Section 3 of the Federal Deposit Insurance Act, 12
U.S.C. Section 1813 (1994 & Supp. V 1999)cash ,
including demand deposits, savings deposits, and funds in such accounts held
for the benefit of the licensee's customers in a federally insured depository
financial institution, and cash equivalents including ACH items in transit to
the licensee and ACH items or international wires in transit to a payee, cash
in transit via armored car, cash in smart safes, cash in licensee-owned
locations, debit card or credit card-funded transmission receivables owed by
any bank, or money market mutual funds rated "AAA" by S&P, or the
equivalent from any eligible rating service;
(2) banker's
acceptance or bill of exchange that is eligible for purchase upon endorsement
by a member bank of the Federal Reserve System and is eligible for purchase by
a Federal Reserve Bankcertificates of deposit or
senior debt obligations of an insured depository institution, as defined in
Section 3 of the Federal Deposit Insurance Act, 12 U.S.C. Section 1813, as
amended or recodified from time to time, or as defined under the federal Credit
Union Act, 12 U.S.C. Section 1781, as amended or recodified from time to time;
(3) an investment
bearing a rating of one of the three highest grades as defined by a nationally
recognized organization that rates securitiesan
obligation of the United States or a commission, agency, or instrumentality
thereof; an obligation that is guaranteed fully as to principal and interest by
the United States; or an obligation of a state or a governmental subdivision,
agency, or instrumentality thereof;
(4) an investment
security that is an obligation of the United States or a department, agency, or
instrumentality of the United States; an investment in an obligation that is
guaranteed fully as to principal and interest by the United States; or an
investment in an obligation of a State or a governmental subdivision, agency,
or instrumentality of a state the full drawable
amount of an irrevocable standby letter of credit for which the stated
beneficiary is the Commissioner that stipulates that the beneficiary need only
draw a sight draft under the letter of credit and present it to obtain funds up
to the letter of credit amount within seven days of presentation of the items
required by subsection (A)(4)(c).
(a) The letter of credit must:
(i) be issued by a federally insured
depository financial institution, a foreign bank that is authorized under
federal law to maintain a federal agency or federal branch office in a state or
states, or a foreign bank that is authorized under state law to maintain a
branch in a state that bears an eligible rating or whose parent company bears
an eligible rating and is regulated, supervised, and examined by United States
federal or state authorities having regulatory authority over banks, credit
unions, and trust companies;
(ii) be irrevocable, unconditional,
and indicate that it is not subject to any condition or qualifications outside
of the letter of credit;
(iii) not contain reference to any
other agreements, documents, or entities, or otherwise provide for any security
interest in the licensee; and
(iv) contain an issue date and
expiration date, and expressly provide for automatic extension, without a
written amendment, for an additional period of one year from the present or
each future expiration date, unless the issuer of the letter of credit notifies
the Commissioner in writing by certified or registered mail or courier mail or
other receipted means, at least sixty days prior to any expiration date, that
the irrevocable letter of credit will not be extended.
(b) In the event of any notice of
expiration or nonextension of a letter of credit issued under subsection
(A)(4)(a)(iv), the licensee is required to demonstrate to the satisfaction of
the Commissioner, fifteen days prior to expiration, that the licensee maintains
and will maintain permissible investments in accordance with Section
35-11-600(A) upon the expiration of the letter of credit. If the licensee is
not able to do so, the Commissioner may draw on the letter of credit in an
amount up to the amount necessary to meet the licensee's requirements to
maintain permissible investments in accordance with Section 35-11-600(A). Any
such draw must be offset against the licensee's outstanding money transmission
obligations. The drawn funds must be held in trust by the Commissioner or the
Commissioner's designated agent, to the extent authorized by law, as agent for
the benefit of the purchasers and holders of the licensee's outstanding money
transmission obligations.
(c) The letter of credit must provide
that the issuer of the letter of credit will honor, at sight, a presentation
made by the beneficiary to the issuer of the following documents on or prior to
the expiration date of the letter of credit:
(i) the original letter of credit,
including any amendments; and
(ii) a written statement from the
beneficiary stating that any of the following events have occurred:
(A) the filing of a petition by or
against the licensee under the United States Bankruptcy Code, 11 U.S.C. Section
101-110, as amended or recodified from time to time, for bankruptcy or
reorganization;
(B) the filing of a petition by or
against the licensee for receivership, or the commencement of any other
judicial or administrative proceeding for its dissolution or reorganization;
(C) the seizure of assets of a
licensee by a commissioner pursuant to an emergency order issued in accordance
with applicable law, on the basis of an action, violation, or condition that
has caused or is likely to cause the insolvency of the licensee; or
(D) the beneficiary has received
notice of expiration or nonextension of a letter of credit and the licensee
failed to demonstrate to the satisfaction of the beneficiary that the licensee
will maintain permissible investments in accordance with Section 35-11-600(A)
upon the expiration or nonextension of the letter of credit.
(d) The Commissioner may designate an
agent to serve on the Commissioner's behalf as beneficiary to a letter of
credit so long as the agent and letter of credit meet requirements established
by the Commissioner. The Commissioner's agent may serve as agent for multiple
licensing authorities for a single irrevocable letter of credit if the proceeds
of the drawable amount for the purposes of this section are assigned to the
Commissioner.
(e) The Commissioner is authorized and
encouraged to participate in multistate processes designed to facilitate the
issuance and administration of letters of credit including, but not limited to,
services provided by the NMLS and State Regulatory Registry, LLC; and
(5) receivables
that are payable to a licensee from its authorized delegates, in the ordinary
course of business, pursuant to contracts that are not past due or doubtful of
collection if the aggregate amount of receivables under this item does not
exceed twenty percent of the total permissible investments of a licensee and
the licensee does not hold at one time receivables under this item in any one
person aggregating more than ten percent of the licensee's total permissible
investments; and
(6) a
share or a certificate issued by an open-end management investment company that
is registered with the United States Securities and Exchange Commission under
the Investment Companies Act of 1940, 15 U.S.C. Section 80a-1-64 (1994 &
Supp. V 1999), and whose portfolio is restricted by the management company's
investment policy to investments specified in items (1) through (4). one hundred percent of the surety bond or
deposit provided for under Section 35-11-215 that exceeds the average daily
money transmission liability in this State.
(B) Unless
permitted by the Commissioner by regulation or order to exceed the limit as set
forth herein, The the following
investments are permissible pursuant to Section 35-11-600, but only to the
extent specified:
(1) an interest-bearing
bill, note, bond, or debenture of a person whose equity shares are traded on a
national securities exchange or on a national over-the-counter market, if the
aggregate of investments under this item does not exceed twenty percent of the
total permissible investments of a licensee and the licensee does not at one
time hold investments under this item in any one person aggregating more than
ten percent of the licensee's total permissible investmentsreceivables that are payable to a licensee from its authorized
delegates in the ordinary course of business that are less than seven days old,
up to fifty percent of the aggregate value of the licensee's total permissible
investments;
(2) a share of a
person traded on a national securities exchange or a national over-the-counter
market or a share or a certificate issued by an open-end management investment
company that is registered with the United States Securities and Exchange
Commission under the Investment Companies Act of 1940, 15 U.S.C. Section
80a-1-64 (1994 & Supp. V 1999), and whose portfolio is restricted by the
management company's investment policy to shares of a person traded on a
national securities exchange or a national over-the-counter market, if the
aggregate of investments under this item does not exceed twenty percent of the
total permissible investments of a licensee and the licensee does not at one
time hold investments in any one person aggregating more than ten percent of
the licensee's total permissible investmentsof the
receivables permissible under item (1), receivables that are payable to a
licensee from a single authorized delegate in the ordinary course of business
may not exceed ten percent of the aggregate value of the licensee's total
permissible investments;
(3) a demand-borrowing
agreement made to a corporation or a subsidiary of a corporation whose
securities are traded on a national securities exchange if the aggregate of the
amount of principal and interest outstanding under demand-borrowing agreements
under this item does not exceed twenty percent of the total permissible
investments of a licensee and the licensee does not at one time hold principal
and interest outstanding under demand-borrowing agreements under this item with
any one person aggregating more than ten percent of the licensee's total
permissible investmentsthe following investments
are permissible up to twenty percent for each category and combined up to fifty
percent of the aggregate value of the licensee's total permissible investments:
(a) a short-term, up to six months,
investment bearing an eligible rating;
(b) commercial paper bearing an
eligible rating;
(c) a bill, note, bond, or debenture
bearing an eligible rating;
(d) U.S. tri-party repurchase
agreements collateralized at one hundred percent or more with U.S. government
or agency securities, municipal bonds, or other securities bearing an eligible
rating;
(e) money market mutual funds rated
less than "AAA" and equal to or higher than "A-" by S&P, or the equivalent
from any other eligible rating service; and
(f) a mutual fund or other investment
fund composed solely and exclusively of one or more permissible investments
listed in subsection (A)(1) through (A)(3); and
(4) another
investment the commissioner designates, to the extent specified by the
commissioner.cash, including demand deposits,
savings deposits, and funds in such accounts held for the benefit of the
licensee's customers, at foreign depository institutions are permissible up to
ten percent of the aggregate value of the licensee's total permissible
investments if the licensee has received a satisfactory rating in its most
recent examination and the foreign depository institution:
(a) has an eligible rating;
(b) is registered under the Foreign
Account Tax Compliance Act;
(c) is not located in any country
subject to sanctions from the Office of Foreign Asset Control; and
(d) is not located in a high-risk or
noncooperative jurisdiction as designated by the Financial Action Task Force.
(C) The aggregate
of investments pursuant to subsection (B) may not exceed fifty percent of the
total permissible investments of a licensee calculated pursuant to Section
35-11-600.
Article 7
Enforcement
Section 35-11-700. (A)
The commissioner Commissioner may
suspend or revoke a license or order a licensee to revoke the designation of an
authorized delegate if:
(1) the licensee violates this chapter
or a rule adopted regulation or
an order issued pursuant to this actchapter;
(2) the licensee does not cooperate
with an examination or investigation by the commissionerCommissioner;
(3) the licensee engages in fraud,
intentional misrepresentation, or gross negligence;
(4) an authorized delegate is
convicted of a violation of a state or federal anti-money laundering statute,
or violates a rule adoptedregulation
or an order issued pursuant to this chapter, as a result of the licensee's
wilful misconduct or wilful blindness;
(5) the competence, experience,
character, or general fitness of the licensee, authorized delegate, person in
control of a licensee, or responsible personkey individual of the licensee or authorized delegate
indicates that it is not in the public interest to permit the person to provide
money services;
(6) the licensee engages in an unsafe
or unsound practice;
(7) the licensee is insolvent,
suspends payment of its obligations, or makes a general assignment for the
benefit of its creditors; or
(8) the licensee does not remove an
authorized delegate after the commissioner Commissioner issues and serves upon the licensee a final
order including a finding that the authorized delegate has violated this
chapter.; or
(9) the licensee is the subject of a
final order, including a denial, suspension, or revocation, by this or any
other state or federal financial services regulator, including a state or
federal money services regulator, that was entered against the licensee within
the past five years.
(B) In determining whether a licensee
is engaging in an unsafe or unsound practice, the commissioner
Commissioner may consider the size and
condition of the licensee's money transmission, the magnitude of the loss, the
gravity of the violation of this actchapter or a regulation or order issued pursuant to this chapter,
and the previous conduct of the person involved.
(C) In determining whether to suspend
or revoke a license under subsection (A)(9), the Commissioner may consider if
the licensee subject to the final order is currently licensed to conduct
business in the jurisdiction where the order was entered.
(D) The Commissioner shall issue a
formal written notice of the suspension or revocation. The Commissioner shall
set forth in the order the specific reasons for the suspension or revocation. A
licensee may request a hearing within thirty days after receipt of the written
notice of suspension or revocation pursuant to Section 35-11-710.
Section 35-11-705. (A)
The commissioner Commissioner may
issue an order suspending or revoking the designation of an authorized
delegate, if the commissioner Commissioner
finds that the:
(1) authorized delegate violated this
chapter or a rule adoptedregulation
or an order issued pursuant to this chapter;
(2) authorized delegate did not
cooperate with an examination or investigation by the commissionerCommissioner;
(3) authorized delegate engaged in
fraud, intentional misrepresentation, or gross negligence;
(4) authorized delegate is convicted
of a violation of a state or federal anti-money laundering statute;
(5) competence, experience, character,
or general fitness of the authorized delegate or a person in control of the
authorized delegate indicates that it is not in the public interest to permit
the authorized delegate to provide money services; or
(6) authorized delegate is engaging in
an unsafe or unsound practice.
(B) In determining whether an
authorized delegate is engaging in an unsafe or unsound practice, the commissioner Commissioner may
consider the size and condition of the authorized delegate's provision of money
services, the magnitude of the loss, the gravity of the violation of this
chapter or a rule adoptedregulation
or order issued pursuant to this chapter, and the previous conduct of the
authorized delegate.
(C) The
Commissioner shall issue a formal written notice of the suspension or
revocation. The Commissioner shall set forth in the order the specific reasons
for the suspension or revocation. An authorized delegate may apply for relief from a suspension or revocation of designation
as an authorized delegate according to procedures prescribed by the
commissionerrequest a hearing within thirty days
after receipt of the written notice of suspension or revocation pursuant to
Section 35-11-710.
Section 35-11-710. (A)
If the commissioner determines that a violation of this
chapter or of a rule adopted or an order issued pursuant to this chapter by a
licensee or authorized delegate is likely to cause immediate and irreparable
harm to the licensee, its customers, or the public as a result of the
violation, or cause insolvency or significant dissipation of assets of the
licensee, the commissioner may issue an order requiring the licensee or
authorized delegate to cease and desist from the violation. The order becomes
effective upon service of it upon the licensee or authorized delegate. If the Commissioner determines that a person has engaged, is
engaging, or is about to engage in an act, practice, or course of business
constituting a violation of this chapter or a regulation or order issued under
this chapter, the Commissioner may:
(1) issue an order directing the
person to cease and desist from engaging in the act, practice, or course of
business or to take other action necessary or appropriate to comply with this
chapter;
(2) issue an order against a licensee
to cease and desist from providing money services through an authorized
delegate that is the subject of a separate order by the Commissioner; or
(3) issue an order under Sections
35-11-220(E), 35-11-235(A), 35-11-310(D), 35-11-515(H), 35-11-515(M),
35-11-700, and 35-11-705.
(B) The
commissioner may issue an order against a licensee to cease and desist from
providing money services through an authorized delegate that is the subject of
a separate order by the commissioner. An order
under subsection (A) is effective on the date of issuance. Upon issuance of the
order, the Commissioner shall promptly serve each person subject to the order
with a copy of the order and a notice that the order has been entered. The
order must include a statement of any civil penalty or costs of investigation
the Commissioner will seek, a statement of the reasons for the order, and
notice that, within fifteen days after receipt of a request in a record from
the person, the matter will be scheduled for a hearing. If a person subject to
the order does not request a hearing and none is ordered by the Commissioner
within thirty days after the date of service of the order, the order, which may
include a civil penalty or costs of the investigation if a civil penalty or
costs were sought, becomes final as to that person by operation of law. If a
hearing is requested or ordered, the Commissioner, after notice of and
opportunity for hearing to each person subject to the order, may modify or
vacate the order or extend it until final determination.
(C) An order to
cease and desist remains effective and enforceable pending the completion of an
administrative proceeding pursuant to Section 35-11-700 or 35-11-705.If a hearing is requested or ordered pursuant to subsection (B),
a hearing must be held. A final order may not be issued unless the Commissioner
makes findings of fact and conclusions of law in a record. The final order may
make final, vacate, or modify the order issued under subsection (A).
(D) In a final order under subsection
(C), the Commissioner may impose a civil penalty against a person that violates
this chapter or a regulation or order issued pursuant to this chapter in an
amount not to exceed one thousand dollars per day for each day the violation is
outstanding, plus this state's costs and expenses for the investigation and
prosecution of the matter, including reasonable attorney fees.
(E) If a petition for judicial review
of a final order is not filed in accordance with Section 35-11-830, the
Commissioner may file a certified copy of the final order with the clerk of
court of competent jurisdiction. The order so filed has the same effect as a
judgment of the court and may be recorded, enforced, or satisfied in the same
manner as a judgment of the court.
(F) If a person does not comply with
an order under this section, the Commissioner may petition a court of competent
jurisdiction to enforce the order. The court may not require the Commissioner
to post a bond in an action or proceeding under this section. If the court
finds, after service and opportunity for hearing, that the person was not in
compliance with the order, the court may adjudge the person in civil contempt
of the order. The court may impose a further civil penalty against the person
for contempt in an amount not less than five hundred dollars but not greater
than five thousand dollars for each violation and may grant any other relief
the court determines is just and proper in the circumstances.
(G) A hearing in an administrative
proceeding under this chapter must be conducted in public unless the
Commissioner, for good cause consistent with this chapter, determines that the
hearing will not be so conducted.
Section 35-11-715. The commissioner
Commissioner may enter into a consent order
at any time with a person to resolve a matter arising pursuant to this chapter
or a rule adoptedregulation
or order issued pursuant to this chapter. A consent order must be signed by the
person to whom it is issued or by the person's authorized representative, and
must indicate agreement with the terms contained in the order. A consent order
may provide that it does not constitute an admission by a person that this
chapter or a rule adoptedregulation
or an order issued pursuant to this chapter has been violated.
Section 35-11-720. The
commissioner may assess a civil penalty against a person that violates this
chapter or a rule adopted or an order issued pursuant to this chapter in an
amount not to exceed one thousand dollars per day for each day the violation is
outstanding, plus this state's costs and expenses for the investigation and
prosecution of the matter, including reasonable attorney fees Reserved.
Section 35-11-725. (A)
A person who intentionally makes a false statement, misrepresentation, or false
certification in a record filed or required to be maintained pursuant to this
chapter, who intentionally makes a false entry or omits a material entry in
that record, or violates a rule promulgated or order issued pursuant to this
chapter is guilty of a Class B felony.
(B) A person who knowingly engages in
an activity for which a license is required pursuant to this chapter without
being licensed pursuant to this chapter and who receives more than five hundred
dollars in compensation within a thirty-day period from this activity is guilty
of a Class B felony.
(C) A person who knowingly engages in
an activity for which a license is required pursuant to this chapter without
being licensed pursuant to this chapter and who receives no more than five
hundred dollars in compensation within a thirty-day period from this activity
is guilty of a Class A misdemeanor.
Section 35-11-730. (A)
If the commissioner Commissioner
has reason to believe that a person has violated or
is violating Section 35-11-200 or 35-11-300, the commissioner may issue an
order to show cause why an order to cease and desist should not be issued
requiring the person to cease and desist from the violation of Section
35-11-200 or 35-11-300.engaged or is about to
engage in an act or practice constituting a violation of this chapter or a
regulation or order issued pursuant to this chapter, the Commissioner may
summarily issue an order to cease and desist pursuant to Section 35-11-710.
(B) In an
emergency, the commissioner may petition the Richland County Circuit Court for
the issuance of a temporary restraining order ex parte pursuant to the rules of
civil procedure.The Commissioner may apply to the
Richland County Court of Common Pleas to:
(1) temporarily or permanently enjoin
an act or practice that violates this chapter or a regulation or order issued
pursuant to this chapter; or
(2) enforce compliance with this
chapter or a regulation or order issued or pursuant to this chapter.
(C) An order to
cease and desist becomes effective upon service of the order on the person. A person that is served with an order to cease and desist for
violating Section 35-11-200 or 35-11-300 may petition the Richland County Court
of Common Pleas for a judicial order setting aside, limiting, or suspending the
enforcement, operation, or effectiveness of the order pending the completion of
an administrative proceeding pursuant to Section 35-11-710.
(D) An
order to cease and desist remains effective and enforceable pending the
completion of an administrative proceeding pursuant to Sections 35-11-800 and
35-11-805.
Section 35-11-735. (A)
Whenever a licensee has refused or is unable to pay its obligations generally
as they become due or whenever it appears to the commissioner
Commissioner that a licensee is in an unsafe
or unsound condition, the commissioner Commissioner may apply to the Richland County Circuit Court of Common Pleas
or to the circuit court of any county in which the licensee is located for the
appointment of a receiver for the licensee. The court may require the receiver
to post a bond in an amount that appears necessary to protect claimants of the
licensee.
(B) The receiver, subject to the
approval of the court, shall take possession of the books, records, and assets
of the licensee and shall take an action with respect to employees, agents, or
representatives of the licensee or other action that may be necessary to
conserve the assets of the licensee or ensure payment of instruments issued by
the licensee pending further disposition of its business as provided by law.
The receiver shall sue and defend, compromise, and settle all claims involving
the licensee and exercise the powers and duties that are necessary and
consistent with the laws of this State applicable to the appointment of
receivers.
(C) The receiver, from time to time,
but in no event less frequently than once each calendar quarter, shall report
to the court with respect to all acts and proceedings in connection with the
receivership.
Section 35-11-740. (A)(1)
A person who, knowing that the property involved in a financial transaction
represents the proceeds of, or is derived directly or indirectly from the
proceeds of unlawful activity, conducts or attempts to conduct such a financial
transaction that in fact involves the proceeds:
(a) with the intent to promote the
carrying on of unlawful activity; or
(b) knowing that the transaction is
designed in whole or in part to conceal or disguise the nature, location,
sources, ownership, or control of the proceeds of unlawful activity is guilty
of a felony and, upon conviction, must be punished as follows:
(i) for a Class F felony if the
transactions exceed three hundred dollars but are less than twenty thousand
dollars in a twelve-month period;
(ii) for a Class E felony for
transactions that total or exceed twenty thousand dollars but are less than one
hundred thousand dollars in a twelve-month period; or
(iii) for a Class C felony for
transactions that total or exceed one hundred thousand dollars in a
twelve-month period.
In
addition to penalties, a person who is found guilty of or who pleads guilty or
nolo contendere to having violated this section may be sentenced to pay a fine
not to exceed two hundred fifty thousand dollars, or twice the value of the
financial transactions, whichever is greater; however, for a second or
subsequent violation of this section, the fine may be up to five hundred
thousand dollars, or quintuple the value of the financial transactions,
whichever is greater.
(2) A person who transports,
transmits, or transfers, or attempts to transport, transmit, or transfer a
monetary instrument or funds from a place in South Carolina to or through a
place outside the United States or to a place in South Carolina from or through
a place outside the United States:
(a) with the intent to promote the
carrying on of unlawful activity; or
(b) knowing that the monetary
instrument or funds involved in the transportation represent the proceeds of
unlawful activity and knowing that the transportation is designed in whole or
in part to conceal or disguise the nature, location, source, ownership, or
control of the proceeds of unlawful activity is guilty of a felony and, upon
conviction, must be punished as follows:
(i) for a Class F felony if the transactions
exceed three hundred dollars but are less than twenty thousand dollars in a
twelve-month period;
(ii) for a Class E felony for
transactions that total or exceed twenty thousand dollars but are less than one
hundred thousand dollars in a twelve-month period; or
(iii) for a Class C felony for
transactions that total or exceed one hundred thousand dollars in a
twelve-month period.
In
addition to penalties, a person who is found guilty of or who pleads guilty or
nolo contendere to having violated this section may be sentenced to pay a fine
not to exceed two hundred fifty thousand dollars or twice the value of the
financial transactions, whichever is greater; however, for a second or
subsequent violation of this section, the fine may be up to five hundred
thousand dollars, or quintuple the value of the financial transactions,
whichever is greater.
(3) A person with the intent:
(a) to promote the carrying on of
unlawful activity; or
(b) to conceal or disguise the nature,
location, source, ownership, or control of property believed to be the proceeds
of unlawful activity, conducts or attempts to conduct a financial transaction
involving property represented by a law enforcement officer to be the proceeds
of unlawful activity, or property used to conduct or facilitate unlawful
activity is guilty of a felony and, upon conviction, must be punished as
follows:
(i) for a Class F felony if the
transactions exceed three hundred dollars but are less than twenty thousand
dollars in a twelve-month period;
(ii) for a Class E felony for
transactions that total or exceed twenty thousand dollars but are less than one
hundred thousand dollars in a twelve-month period; or
(iii) for a Class C felony for
transactions that total or exceed one hundred thousand dollars in a
twelve-month period.
In
addition to penalties, a person who is found guilty of or who pleads guilty or
nolo contendere to having violated this section may be sentenced to pay a fine
not to exceed two hundred fifty thousand dollars or twice the value of the
financial transactions, whichever is greater; however, for a second or
subsequent violation of this section, the fine may be up to five hundred
thousand dollars or quintuple the value of the financial transactions,
whichever is greater.
For
purposes of this subitem, the term "represented" means a representation made by
a law enforcement officer or by another person at the direction of, or with the
approval of, a state official authorized to investigate or prosecute violations
of this section.
(B) A person who conducts or attempts
to conduct a transaction described in subsection (A)(1), or transportation
described in subsection (A)(2), is liable to the State for a civil penalty of
not more than the greater of:
(1) the value of the property, funds,
or monetary instruments involved in the transaction; or
(2) ten thousand dollars.
A
court may issue a pretrial restraining order or take another action necessary
to ensure that a bank account or other property held by the defendant in the
United States is available to satisfy a civil penalty under this section.
(C) As used in this section:
(1) the term "conducts" includes
initiating, concluding, or participating in initiating or concluding a
transaction;
(2) the term "transaction" includes a
purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition
and, with respect to a financial institution, includes a deposit, withdrawal,
transfer between accounts, exchange of currency, loan, extension of credit,
purchase or sale of a stock, bond, certificate of deposit, or other monetary
instrument, or another payment, transfer, or delivery by, through, or to a
financial institution, by whatever means effected;
(3) the term "financial transaction"
means a transaction involving the movement of funds by wire or other means or
involving one or more monetary instruments;
(4) the term "monetary instruments"
means coin or currency of the United States or of another country, travelers'
checks, personal checks, bank checks, money orders, investment securities in
bearer form or otherwise in that form that title to it passes upon delivery,
and negotiable instruments in bearer form or otherwise in that form that title
to it passes upon delivery;
(5) the term "financial institution"
has the definition given that term in Section 5312(a)(2), Title 31, United
States Code, and the regulations promulgated thereunder.
(D) Nothing in this section supersedes
a provision of law imposing criminal penalties or affording civil remedies in
addition to those provided for in this section, and nothing in this section
precludes reliance in the appropriate case upon the provisions set forth in
Section 44-53-475.
Section 35-11-745. (A)
The Commissioner may:
(1) conduct public or private
investigations within or outside of this State which the Commissioner considers
necessary or appropriate to determine whether a person has violated, is
violating, or is about to violate this chapter or a regulation or order issued
pursuant to this chapter, or to aid in the enforcement of this chapter or in
the adoption of rules and forms under this chapter;
(2) require or permit a person to
testify, file a statement, or produce a record, under oath or otherwise as the
Commissioner determines, as to all the facts and circumstances concerning a
matter to be investigated or about which an action or proceeding is to be
instituted; and
(3) publish a record concerning an
action, proceeding, or an investigation under, or a violation of, this chapter
or a regulation or order issued pursuant to this chapter if the Commissioner
determines it is necessary or appropriate in the public interest.
(B) For the purpose of an
investigation under this chapter, the Commissioner or its designated officer
may administer oaths and affirmations, subpoena witnesses, seek compulsion of
attendance, take evidence, require the filing of statements, and require the
production of any records that the Commissioner considers relevant or material
to the investigation.
(C) If a person does not appear or
refuses to testify, file a statement, produce records, or otherwise does not
obey a subpoena as required by the Commissioner under this chapter, the
Commissioner may apply to the Richland County Court of Common Pleas or a court
of another state to enforce compliance. The court may:
(1) hold the person in contempt;
(2) order the person to appear before
the Commissioner;
(3) order the person to testify about
the matter under investigation or in question;
(4) order the production of records;
(5) grant injunctive relief;
(6) impose a civil penalty of not less
than five hundred dollars and not greater than five thousand dollars for each
violation; and
(7) grant any other necessary or
appropriate relief.
(D) This section does not preclude a
person from applying to the Richland County Court of Common Pleas for relief
from a request to appear, testify, file a statement, produce records, or obey a
subpoena.
Article 8
Administrative
Procedures
Section 35-11-800. All
administrative proceedings pursuant to this chapter must be conducted in
accordance with Article 3, Chapter 23, Title 1.In order to carry out the
purposes of this chapter, the Commissioner may, subject to the provisions of
Section 35-11-530:
(1) enter into agreements or
relationships with other governmental officials or federal and state regulatory
agencies and regulatory associations in order to improve efficiencies and
reduce regulatory burden by standardizing methods or procedures, and sharing
resources, records, or related information obtained under this chapter;
(2) use, hire, contract, or employ
analytical systems, methods, or software to examine or investigate any person
subject to this chapter;
(3) accept, from other state or
federal governmental agencies or officials, licensing, examination, or
investigation reports made by such other state or federal governmental agencies
or officials; and
(4) accept audit reports made by an
independent certified public accountant or other qualified third-party auditor
for an applicant or licensee and incorporate the audit report in any report of
examination or investigation.
Section 35-11-805. Except
as otherwise provided in Sections 35-11-225(C), 35-11-315(C), 35-11-710, and
35-11-730, the commissionerThe Commissioner
may not suspend or revoke a license, issue an order to cease and desist,
suspend or revoke the designation of an authorized delegate, or assess a civil
penalty without notice and an opportunity to be heard
pursuant to Section 35-11-710. The commissioner Commissioner also shall hold a hearing when requested to
do so by an applicant whose application for a license is denied.
Section 35-11-810. This chapter is
administered by the commissioner Commissioner who may employ such additional assistants as
he deems necessary. The commissioner Commissioner may delegate any or all of his duties
pursuant to this chapter to members of his staff, as he deems necessary or
appropriate.
Section 35-11-815. The commissioner may
promulgate and amend regulations or issue orders necessary to carry out the
purposes of this chapter in order to provide for the protection of the public
and to assist licensees in interpreting and complying with this chapter.
Section 35-11-820. The Commissioner may
establish reasonable fees for filings required or permitted by regulation or
order adopted pursuant to this chapter, and other miscellaneous filings for
which no fees are otherwise specified by law.
Section 35-11-825. The Commissioner may
retain all fees, assessments, and fines received under this chapter for the
administration of this chapter.
Section 35-11-830. A person aggrieved by a
final order of the Commissioner may obtain a review of the order in the
Richland County Court of Common Pleas by filing in the court, within thirty
days after entry of the order, a written petition praying that the order may be
modified or set aside in whole or in part. The aggrieved person, upon filing a
petition, may move before the court in which the petition is filed to stay the
effectiveness of the Commissioner's final order until such time as the court
has reviewed the order. If the court orders a stay, the aggrieved person must
post any bond set by the court in which a petition is filed. A copy of the
petition must be served upon the Commissioner, and the Commissioner shall
certify and file in court a copy of the filing and evidence upon which the
order was entered. When these have been filed, the court has exclusive
jurisdiction to affirm, modify, enforce, or set aside the order, in whole or in
part. The findings of the Commissioner as to the facts, if supported by
competent, material, and substantial evidence, are conclusive.
Article 9
Miscellaneous
Provisions
Section 35-11-900. In applying and
construing this Uniform Act, consideration must be given to the need to promote
uniformity of the law with respect to its subject matter among states that
enact it.
Section 35-11-905. (A)
A person licensed in this State to engage in the business of money transmission
may not be subject to the amended provisions of this chapter, to the extent
that they conflict with the prior law or establish new requirements not imposed
under the prior law, until the first January first after the effective date of
this chapter.
(B) Notwithstanding subsection (A), a
licensee only must be required to amend its authorized delegate contracts for
contracts entered into or amended after the effective date of the amendments to
this chapter or the completion of any transition period contemplated under
subsection (A). Nothing herein may be construed as limiting an authorized
delegate's obligations to operate in full compliance with this chapter as
required by Section 35-11-400(C).
SECTION
2. The repeal or amendment by this act of any law,
whether temporary or permanent or civil or criminal, does not affect pending
actions, rights, duties, or liabilities founded thereon, or alter, discharge,
release or extinguish any penalty, forfeiture, or liability incurred under the
repealed or amended law, unless the repealed or amended provision shall so
expressly provide. After the effective date of this act, all laws
repealed or amended by this act must be taken and treated as remaining in full
force and effect for the purpose of sustaining any pending or vested right,
civil action, special proceeding, criminal prosecution, or appeal existing as
of the effective date of this act, and for the enforcement of rights, duties,
penalties, forfeitures, and liabilities as they stood under the repealed or
amended laws.
SECTION
3. If any section, subsection, paragraph,
subparagraph, sentence, clause, phrase, or word of this act is for any reason
held to be unconstitutional or invalid, such holding shall not affect the
constitutionality or validity of the remaining portions of this act, the
General Assembly hereby declaring that it would have passed this act, and each
and every section, subsection, paragraph, subparagraph, sentence, clause,
phrase, and word thereof, irrespective of the fact that any one or more other
sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases,
or words hereof may be declared to be unconstitutional, invalid, or otherwise
ineffective.
SECTION
4. This act takes effect upon approval by the Governor.
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