SF 2270

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to commerce; requiring separate licensure for
industrial loan and thrift companies acting as
currency exchanges; amending Minnesota Statutes 2004,
sections 53.05; 53A.01, subdivision 1.

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

Section 1.

Minnesota Statutes 2004, section 53.05, is
amended to read:

53.05 POWERS, LIMITATION.

No industrial loan and thrift company may do any of the
following:

(1) carry demand banking accounts; use the word "savings"
unless the institution's investment certificates, savings
accounts, and savings deposits are insured by the Federal
Deposit Insurance Corporation and then only if the word is not
followed by the words "and loan" in its corporate name; use the
word "bank" or "banking" in its corporate name; operate as a
savings bank;

(2) have outstanding at any one time certificates of
indebtedness, savings accounts, and savings deposits 30 times
the sum of capital stock and surplus of the company;

(3) accept trusts, except as provided in section 47.75,
subdivision 1, or act as guardian, administrator, or judicial
trustee in any form;

(4) deposit any of its funds in any banking corporation,
unless that corporation has been designated by vote of a
majority of directors or of the executive committee present at a
meeting duly called, at which a quorum was in attendance;

(5) change any allocation of capital made pursuant to
section 53.03 or reduce or withdraw in any way any portion of
the capital stock and surplus without prior written approval of
the commissioner of commerce;

(6) take any instrument in which blanks are left to be
filled in after execution;

(7) lend money in excess of 20 percent of the total of its
capital stock and surplus at all its authorized locations to a
person primarily liable. Companies not issuing investment
certificates of indebtedness under section 53.04 need not comply
with the requirement if the amount of money lent does not exceed
$100,000 of principal as defined by section 47.59, subdivision
1, paragraph (p).

However, industrial loan and thrift companies with deposit
liabilities must comply with the provisions of section 48.24; deleted text begin or
deleted text end

(8) issue cashier's checks pursuant to section 48.151,
unless and at all times the aggregate liability to all creditors
on these instruments is protected by a special fund in cash or
due from banks to be used solely for payment of the cashier's
checks new text begin ; or
new text end

new text begin (9) act as a currency exchange as defined in section
53A.01, unless separately licensed as a currency exchange under
chapter 53A new text end .

Sec. 2.

Minnesota Statutes 2004, section 53A.01,
subdivision 1, is amended to read:

Subdivision 1.

Currency exchange.

"Currency exchange"
means any person, except a bank, trust company, savings bank,
savings association, new text begin or new text end credit union, deleted text begin or industrial loan and
thrift company, deleted text end engaged in the business of cashing checks,
drafts, money orders, or travelers' checks for a fee. "Currency
exchange" does not include a person who provides these services
incidental to the person's primary business if the charge for
cashing a check or draft does not exceed $1 or one percent of
the value of the check or draft, whichever is greater.

Sec. 3. new text begin EFFECTIVE DATE; APPLICATION.
new text end

new text begin Sections 1 and 2 are effective the day following final
enactment and apply to applications for currency exchange
licenses made on or after April 1, 2005.
new text end