HF 157

1st Engrossment - 88th Legislature (2013 - 2014) Posted on 02/14/2013 03:53pm

A bill for an act
relating to commerce; regulating bullion coin dealers; requiring registration;
prohibiting certain conduct; providing enforcement authority and criminal
penalties; proposing coding for new law as Minnesota Statutes, chapter 80G.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [80G.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin For the purposes of this chapter, the following terms have the
meanings given in this section.
new text end

new text begin Subd. 2. new text end

new text begin Bullion coin. new text end

new text begin "Bullion coin" means a coin containing more than one
percent by weight of silver, gold, platinum, or other precious metal.
new text end

new text begin Subd. 3. new text end

new text begin Bullion coin dealer. new text end

new text begin (a) Subject to the exceptions in paragraph (b),
"bullion coin dealer" means a person who buys, sells, solicits, or markets bullion coins
or investments in bullion coins to consumers and is either incorporated, registered,
domiciled, or otherwise located in the state or who does business with a consumer
domiciled, residing, or otherwise located in the state.
new text end

new text begin (b) Bullion coin dealer does not include any of the following:
new text end

new text begin (1) a person who engages in isolated transactions, consisting of less than five bullion
coin transactions with consumers during and 12-month period;
new text end

new text begin (2) a person who engages in isolated transactions, consisting of bullion coin
transactions with consumers during any 12-month period that do not exceed $5,000 in the
aggregate as determined by the transactions' sale prices;
new text end

new text begin (3) a person who engages only in wholesale bullion coin transactions with bullion
coin dealers who sell at retail and are properly registered under this chapter; or
new text end

new text begin (4) a person who engages only in transactions at occasional garage or yard sales
held at the seller's residence, farm auctions held at the seller's residence, or estate sales
held at the decedent's residence.
new text end

new text begin Subd. 4. new text end

new text begin Coin dealer representative. new text end

new text begin "Coin dealer representative" means a natural
person acting as an employee, contractor, or agent of a bullion coin dealer and who
has interactions with consumers in connection with the buying, selling, solicitation, or
marketing of bullion coins or investments in bullion coins.
new text end

new text begin Subd. 5. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of commerce.
new text end

new text begin Subd. 6. new text end

new text begin Person. new text end

new text begin "Person" has the meaning given in section 325F.68, subdivision 3.
new text end

new text begin Subd. 7. new text end

new text begin Precious metal content. new text end

new text begin "Precious metal content" means the quantity,
measured in grams, of gold, silver, platinum, or other precious metal in a coin and the
percentage that the precious metal constitutes of the total weight of the coin.
new text end

Sec. 2.

new text begin [80G.02] REGISTRATION.
new text end

new text begin Subdivision 1. new text end

new text begin Required. new text end

new text begin It is unlawful for a bullion coin dealer or coin dealer
representative to solicit, market, buy, sell, or deliver bullion coins or investments in
bullion coins to a consumer without having first registered with the commissioner as
provided in this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Obligations. new text end

new text begin A bullion coin dealer must register itself and each of its coin
dealer representatives with the commissioner. A bullion coin dealer shall verify and certify
in the registration of each coin dealer representative application that the representative
satisfies the requirements of sections 80G.03 and 80G.04. A registration approved by the
commissioner under this chapter expires one year after registration.
new text end

new text begin Subd. 3. new text end

new text begin Application. new text end

new text begin All applications for registration by a bullion coin dealer
or coin dealer representative must be made on forms approved by the commissioner.
The commissioner may determine the requirements of the application form, and other
materials, if any, that must be appended to it. This determination by the commissioner
is not subject to the rulemaking provisions of chapter 14, including section 14.386. At a
minimum, the application must include the following, as applicable:
new text end

new text begin (1) the name and business address of the bullion coin dealer and the name and
primary work location of each coin dealer representative. A bullion coin dealer who
desires to carry on business in more than one location shall identify each address where
business is to be conducted; and
new text end

new text begin (2) a disclosure by each officer and owner of the bullion coin dealer and each coin
dealer representative of all criminal convictions by any court within the last ten years.
new text end

new text begin Subd. 4. new text end

new text begin Notice of address change. new text end

new text begin A bullion coin dealer must give the
commissioner written notice of a change in the dealer's name, assumed name, business
addresses, or ownership no later than 15 days after the change occurs. A coin dealer
representative must give written notice of a change of work address or name no later than
30 days after the change occurs.
new text end

new text begin Subd. 5. new text end

new text begin Fee. new text end

new text begin The fee for each registration under this chapter shall be as follows:
new text end

new text begin (1) Bullion coin dealer: $.......
new text end

new text begin (2) Coin dealer representative: $.......
new text end

Sec. 3.

new text begin [80G.03] DISQUALIFICATION.
new text end

new text begin The commissioner shall not accept a registration for a coin dealer representative
who has, within the last 15 years, or for a bullion coin dealer whose owners or officers
have, within the past 15 years:
new text end

new text begin (1) been convicted in any court of any felony;
new text end

new text begin (2) been convicted in any court of any crime involving fraud or deceit, theft, or
any financial crime;
new text end

new text begin (3) been unable to truthfully certify that they have no civil judgments against them,
including but not limited to conciliation court or equivalent judgments, for failure to
account to a customer for money or property received from the customer; or
new text end

new text begin (4) been unable to truthfully certify that they have not entered into a settlement or
other agreement with any government entity resolving concerns by the government entity
that they had violated consumer protection or unfair trade practice laws.
new text end

Sec. 4.

new text begin [80G.04] SCREENING PROCESS.
new text end

new text begin Subdivision 1. new text end

new text begin Required. new text end

new text begin A bullion coin dealer must establish procedures to screen
each of its owners and officers and each coin dealer representative before submitting to
the commissioner the application for initial registration and at renewal. The results of the
screenings must be provided to the commissioner as part of the initial registration and
all renewal registrations.
new text end

new text begin Subd. 2. new text end

new text begin Initial screening. new text end

new text begin The screening process for initial registration must
be done before the time of hiring and registration. The process must include a national
criminal history record search and a judgment search and county criminal history search
for all counties where the applicant has resided within the immediately preceding five
years, to determine whether the applicant is eligible to be registered under this chapter.
Each bullion coin dealer shall use a vendor that is a member of the National Association of
Professional Background Screeners, or an equivalent vendor, to conduct the background
screening process on its owners and officers and coin dealer representatives.
new text end

new text begin Subd. 3. new text end

new text begin Renewal screening. new text end

new text begin The screening process for the renewal of a coin dealer
representative's registration must include a national criminal history record search and a
judgment search and county criminal history search for all counties where the individual
has resided since satisfactorily completing the last screening process conducted pursuant
to this chapter. Screening for renewal of coin dealer representative registrations must take
place no more than 60 days before the registration expiration or renewal date.
new text end

Sec. 5.

new text begin [80G.05] BOND REQUIREMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Surety bond requirement. new text end

new text begin Every bullion coin dealer shall maintain
a current, valid surety bond issued by a surety company admitted to do business in
Minnesota in an amount no less than the transactions (purchases from and sales to
consumers at retail) during the 12-month period prior to registration. In no event shall the
surety bond required under this subdivision be more than $200,000.
new text end

new text begin Subd. 2. new text end

new text begin Action on bond permitted. new text end

new text begin A consumer injured in money or property by a
bullion coin dealer's or coin dealer representative's failure to provide bullion coins that
the consumer has paid for or failure to remit money or goods owed to the consumer in
connection with the consumer's sale of bullion coins may file a claim with the surety and,
if the claim is not paid, is authorized to bring an action based on the bond and recover
against the surety. The commissioner or attorney general may also file a claim and bring
an action on the bond and recover against the surety on behalf of a consumer so injured.
new text end

Sec. 6.

new text begin [80G.06] DISCLOSURE.
new text end

new text begin Before the sale of any bullion coins, a bullion coin dealer must disclose to the
consumer in a clear and conspicuous manner the sale price and precious metal content of
the bullion coins involved in the transaction.
new text end

Sec. 7.

new text begin [80G.07] PROHIBITED CONDUCT.
new text end

new text begin A bullion coin dealer or coin dealer representative shall not:
new text end

new text begin (1) fail to deliver bullion coins to a consumer within the time agreed upon with
the consumer or, if no such agreement exists, within 30 days after the consumer has
paid for the coins;
new text end

new text begin (2) fail to pay a seller for purchased bullion coins within the time agreed upon
with the consumer or, if no such agreement exists, within 30 days after the consumer
has provided the coins;
new text end

new text begin (3) fail to provide an invoice at the time of the transaction describing the nature of
the bullion coins involved in the transaction, the quantity of bullion coins involved in the
transaction, and the bullion coins' sale price and precious metal content;
new text end

new text begin (4) misrepresent the value of the bullion coins, the delivery date of coins or payment
for coins, or the dealer or representative's professional qualifications, affiliations, or
registration;
new text end

new text begin (5) misrepresent the manner in which any coins a consumer provides will be stored
or otherwise handled once received;
new text end

new text begin (6) renegotiate the terms of a sale after receiving a consumer's payment or coins
without first offering the consumer the option to have the payment fully refunded or
the entirety of the coins returned;
new text end

new text begin (7) fail to respond within three business days to a consumer inquiry about the
delivery status of coins that the consumer has paid for but not yet received or the status of
payment for coins that the consumer has already provided;
new text end

new text begin (8) telephone or solicit a consumer, or sell or provide the consumer's name to any
other bullion coin dealer or coin dealer representative, after the consumer requests not
to be contacted; or
new text end

new text begin (9) violate any other Minnesota rule or law.
new text end

Sec. 8.

new text begin [80G.08] ENFORCEMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Commissioner's authority. new text end

new text begin The commissioner has all authority
provided under section 45.027 to ensure compliance with this chapter, including but not
limited to the authority to deny, suspend, or revoke the registration of any bullion coin
dealer or coin dealer representative for a violation of this chapter or other Minnesota law.
Appeal from a denial, suspension, or revocation of registration must be made according
to chapter 14.
new text end

new text begin Subd. 2. new text end

new text begin Violation as consumer fraud. new text end

new text begin A violation of this chapter is a violation of
section 325F.69, subdivision 1, and the provisions of section 8.31 apply.
new text end

Sec. 9.

new text begin [80G.09] CRIMINAL PENALTY.
new text end

new text begin A person who conducts business as a bullion coin dealer or as a coin dealer
representative without having first registered with the commissioner, or who carries on the
business after the revocation, suspension, or expiration of a registration, or who violates
section 80G.07, clause (1) or (2), is guilty of a misdemeanor.
new text end

Sec. 10.

new text begin [80G.10] OTHER ACTION.
new text end

new text begin Nothing in this chapter precludes an action under chapter 80A.
new text end