Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 2001, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 148-S.F.No. 1485
An act relating to commerce; providing for the
licensing of money transmitters; prescribing the
powers and duties of the commissioner; amending
Minnesota Statutes 2000, section 48.151; proposing
coding for new law as Minnesota Statutes, chapter 53B.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 2000, section 48.151, is
amended to read:
48.151 [ADDITIONAL POWERS.]
Any bank, savings bank, or trust company organized under
the laws of this state, or any national banking association
doing business in this state, shall have the power to advertise
for sale and sell for a fee money orders, traveler's checks,
cashier's checks, drafts, registered checks, and certified
checks and no other person, firm, or corporation, either
directly or through agents, shall advertise for sale or shall
sell for a fee any evidence of indebtedness on which there
appears the words, "money order," "traveler's check," "cashier's
check," "draft," "registered check," "certified check," or other
words or symbols whether of the same or different character
which tend to lead the purchaser to believe that such evidence
of indebtedness is other than a personal check, unless such
evidence of indebtedness is issued by a person, firm or
corporation which is a savings association, or telegraph
company, or, in the case of cashier's checks, is issued by an
industrial loan and thrift company with deposit liabilities,
provided that these instruments are issued in conformity with
the Uniform Commercial Code, or is issued by a person, firm, or
corporation that has on file in the office of the secretary of
state a surety bond in the principal sum of $5,000 issued by a
bonding or insurance company authorized to do business in this
state, which surety bond shall run to the state of Minnesota and
shall be for the benefit of any creditor for any liability
insured on account of the sale or issuance by it or its agent of
any such evidence of indebtedness, or has deposited with the
secretary of state securities or cash of the value of $5,000;
provided, however, that the aggregate liability of the surety to
all such creditors shall, in no event, exceed the sum of such
bond or deposit licensed under chapter 53B. Any person, firm or
corporation who shall violate any provision of this section
shall be guilty of a misdemeanor.
Sec. 2. [53B.01] [CITATION.]
This chapter may be cited as the "Minnesota Money
Transmitters Act."
Sec. 3. [53B.02] [LICENSE REQUIRED.]
On or after January 1, 2002, no person except those exempt
pursuant to section 53B.04 shall engage in the business of money
transmission without a license as provided in this chapter. A
licensee may conduct business in this state at one or more
locations, directly or indirectly owned, or through one or more
authorized delegates, or both, under a single license granted to
the licensee.
Sec. 4. [53B.03] [DEFINITIONS.]
Subdivision 1. [SCOPE.] For purposes of this chapter, the
definitions in this section apply unless the context requires
otherwise.
Subd. 2. [APPLICANT.] "Applicant" means a person filing an
application for a license under this chapter.
Subd. 3. [AUTHORIZED DELEGATE.] "Authorized delegate"
means an entity designated by the licensee under this chapter,
or by an exempt entity, to sell or issue payment instruments or
engage in the business of transmitting money on behalf of a
licensee.
Subd. 4. [COMMISSIONER.] "Commissioner" means the
commissioner of commerce.
Subd. 5. [CONTROL.] "Control" means ownership of, or the
power to vote, ten percent or more of the outstanding voting
securities of a licensee or controlling person. For purposes of
determining the percentage of a licensee controlled by any
person, the person's interest must be aggregated with the
interest of any other person controlled by the person or by any
spouse, parent, or child of the person.
Subd. 6. [CONTROLLING PERSON.] "Controlling person" means
any person in control of a licensee.
Subd. 7. [ELECTRONIC INSTRUMENT.] "Electronic instrument"
means a card or other tangible object for the transmission or
payment of money that contains a microprocessor chip, magnetic
stripe, or other means for the storage of information, that is
prefunded and for which the value is decreased upon each use.
The term does not include a prepaid telephone card, electronic
benefits transfer card, or any other card or other tangible
object that is redeemable by the issuer in the issuer's goods or
services.
Subd. 8. [EXECUTIVE OFFICER.] "Executive officer" means
the licensee's president, chair of the executive committee,
senior officer responsible for the licensee's business, chief
financial officer, and any other person who performs similar
functions.
Subd. 9. [EXEMPT ENTITY.] "Exempt entity" means a person
to which this chapter does not apply under section 53B.04.
Subd. 10. [KEY SHAREHOLDER.] "Key shareholder" means any
person, or group of persons acting in concert, who is the owner
of ten percent or more of any voting class of an applicant's
stock.
Subd. 11. [LICENSEE.] "Licensee" means a person licensed
under this chapter.
Subd. 12. [MATERIAL LITIGATION.] "Material litigation"
means any litigation in which an applicant or a licensee has
been a defendant or been named in a civil judgment involving
claims of fraud, misrepresentation, conversion, mismanagement of
funds, breach of fiduciary duty, or breach of contract.
Subd. 13. [MONEY TRANSMISSION.] "Money transmission" means
selling or issuing payment instruments or engaging in the
business of receiving money for transmission or transmitting
money within the United States or to locations abroad by any and
all means, including but not limited to payment instrument,
wire, facsimile, or electronic transfer.
Subd. 14. [OUTSTANDING PAYMENT INSTRUMENT.] "Outstanding
payment instrument" means any payment instrument issued by the
licensee that has been sold in the United States directly by the
licensee or any payment instrument issued by the licensee that
has been sold by an authorized delegate of the licensee in the
United States, and that has not yet been paid by or for the
licensee.
Subd. 15. [PAYMENT INSTRUMENT.] "Payment instrument" means
any electronic or written check, draft, money order, travelers
check, or other electronic or written instrument or order for
the transmission or payment of money, sold or issued to one or
more persons, whether or not the instrument is negotiable. The
term does not include any credit card voucher, letter of credit,
or instrument that is redeemable by the issuer in goods or
services.
Subd. 16. [PERMISSIBLE INVESTMENTS.] "Permissible
investments" means:
(1) cash;
(2) certificates of deposit or other debt obligations of a
financial institution, either domestic or foreign;
(3) bills of exchange or time drafts drawn on and accepted
by a commercial bank, otherwise known as bankers' acceptances,
that are eligible for purchase by member banks of the Federal
Reserve system;
(4) any investment bearing a rating of one of the three
highest grades as defined by a nationally recognized
organization that rates these securities;
(5) investment securities that are obligations of the
United States, its agencies or instrumentalities, or obligations
that are guaranteed fully as to principal and interest of the
United States, or any obligations of any state, municipality, or
any political subdivision of a state or municipality;
(6) shares in a money market mutual fund, interest-bearing
bills or notes or bonds, debentures, or a fund composed of one
or more permissible investments;
(7) any demand borrowing agreement or agreements made to a
corporation or a subsidiary of a corporation whose capital stock
is listed on a national exchange;
(8) receivables that are due to a licensee from its
authorized delegates under a contract described in section
53B.20, that are not past due or doubtful of collection; or
(9) any other investments or security device approved by
the commissioner.
Subd. 17. [PERSON.] "Person" means any individual,
corporation, limited liability company, business trust, general
or limited partnership, association, sole proprietorship, or
similar organization.
Subd. 18. [REMIT.] "Remit" means either to make direct
payment of the funds to the licensee or its representatives
authorized to receive those funds or to deposit the funds in a
bank, credit union, savings association, or other similar
financial institution in an account specified by the licensee.
Sec. 5. [53B.04] [EXEMPTIONS.]
Authorized delegates of a licensee or of an exempt entity,
acting within the scope of authority conferred by a written
contract as described in section 53B.20, are not required to
obtain a license under this chapter. This chapter does not
apply to:
(1) the United States or any department, agency, or
instrumentality of the United States;
(2) the United States Postal Service;
(3) the state or any political subdivision of the state;
(4) banks, credit unions, savings associations, savings
banks, mutual banks organized under the laws of any state or the
United States, or bank holding companies which have a banking
subsidiary located in Minnesota and whose debt securities have
an investment grade rating by a national rating agency, provided
that if they issue or sell payment instruments through
authorized delegates who are not banks, bank holding companies,
credit unions, savings associations, savings banks, or mutual
banks, those authorized delegates must comply with all
requirements imposed upon authorized delegates under this
chapter; and
(5) the provision of electronic transfer of government
benefits for any federal, state, or county governmental agency
as defined in Federal Reserve Board Regulation E, by a
contractor for and on behalf of the United States or any
department, agency, or instrumentality of the United States, or
any state or any political subdivision of the state.
Sec. 6. [53B.05] [LICENSE QUALIFICATIONS.]
Subdivision 1. [NET WORTH.] Each licensee under this
chapter shall at all times have a net worth of not less than
$100,000, calculated in accordance with generally accepted
accounting principles. Licensees engaging in money transmission
at more than one location or through authorized delegates shall
have an additional net worth of $50,000 per location or
authorized delegate located in the state, as applicable, to a
maximum of $500,000.
Subd. 2. [CORPORATE APPLICANT; GOOD STANDING.] Every
corporate applicant, at the time of the filing of an application
for a license under this chapter and at all times after a
license is issued, must be in good standing in the state of its
incorporation. All noncorporate applicants shall, at the time
of the filing of an application for a license under this chapter
and at all times after a license is issued, be registered or
qualified to do business in the state.
Sec. 7. [53B.06] [PERMISSIBLE INVESTMENTS AND STATUTORY
TRUST.]
(a) Each licensee under this chapter must at all times
possess permissible investments having an aggregate market
value, calculated in accordance with generally accepted
accounting principles, of not less than the aggregate face
amount of all outstanding payment instruments sold by the
licensee or reported as sold by an authorized delegate in the
United States. This requirement may be waived by the
commissioner if the dollar volume of a licensee's outstanding
payment instruments does not exceed the bond or other security
devices posted by the licensee under section 53B.08.
(b) Permissible investments, even if commingled with other
assets of the licensee, are considered to be held in trust for
the benefit of the purchasers and holders of the licensee's
outstanding payment instruments in the event of the bankruptcy
of the licensee.
Sec. 8. [53B.07] [LICENSE APPLICATION.]
Subdivision 1. [REQUIREMENTS.] An application for a
license under this chapter must be made in writing, under oath,
and in a form prescribed by the commissioner.
Subd. 2. [GENERAL CONTENTS.] An application must contain:
(1) the exact name of the applicant, the applicant's
principal address, any fictitious or trade name used by the
applicant in the conduct of its business, and the location of
the applicant's business records;
(2) the history of the applicant's or any controlling
person's material litigation during the preceding ten years and
criminal convictions;
(3) a description of the activities conducted by the
applicant and a history of operations;
(4) a description of the business activities in which the
applicant seeks to be engaged in the state;
(5) a list identifying the applicant's proposed authorized
delegates in the state, if any, at the time of the filing of the
license application;
(6) a sample authorized delegate contract, if applicable;
(7) a sample form of payment instrument, if applicable;
(8) the location or locations at which the applicant and
its authorized delegates, if any, propose to conduct the
licensed activities in the state; and
(9) the name, address, and account numbers for the clearing
bank or banks on which the applicant's payment instruments will
be drawn or through which these payment instruments will be
payable.
Subd. 3. [ADDITIONAL INFORMATION FROM CORPORATIONS.] If
the applicant is a corporation, the applicant must also provide:
(1) the date of the applicant's incorporation and state of
incorporation;
(2) a certificate of good standing from the state in which
the applicant was incorporated;
(3) a description of the corporate structure of the
applicant, including the identity of any parent or subsidiary of
the applicant, and the disclosure of whether any parent or
subsidiary is publicly traded on any stock exchange;
(4) the name, business and residence address, and
employment history for the past five years of the applicant's
executive officers and the officers or managers who will be in
charge of the applicant's activities to be licensed under this
chapter;
(5) the name, business and residence address, and
employment history for the period five years prior to the date
of the application of any key shareholder of the applicant;
(6) the history of material litigation during the preceding
ten years and criminal convictions of every executive officer or
key shareholder of the applicant;
(7) a copy of the applicant's most recent audited financial
statement, including balance sheet, statement of income or loss,
statement of changes in shareholder equity, and statement of
changes in financial position, and, if available, the
applicant's audited financial statements for the immediately
preceding two-year period. However, if the applicant is a
wholly owned subsidiary of another corporation, the applicant
may submit either the parent corporation's consolidated audited
financial statements for the current year and for the
immediately preceding two-year period or the parent
corporation's Form 10K reports filed with the United States
Securities and Exchange Commission for the prior three years in
lieu of the applicant's financial statements. If the applicant
is a wholly owned subsidiary of a corporation having its
principal place of business outside the United States, similar
documentation filed with the parent corporation's non-United
States regulator may be submitted to satisfy this provision; and
(8) copies of all filings, if any, made by the applicant
with the United States Securities and Exchange Commission, or
with a similar regulator in a country other than the United
States, within the year preceding the date of filing the
application.
Subd. 4. [ADDITIONAL INFORMATION FROM NONCORPORATE
APPLICANTS.] If the applicant is not a corporation, the
applicant must also provide:
(1) the name, business and residence address, personal
financial statement, and employment history for the past five
years, of each principal of the applicant and the name, business
and residence address, and employment history for the past five
years of any other person or persons who will be in charge of
the applicant's activities to be licensed under this chapter;
(2) the place and date of the applicant's registration or
qualification to do business in this state;
(3) the history of material litigation during the preceding
ten years and criminal convictions for each individual having
any ownership interest in the applicant and each individual who
exercises supervisory responsibility with respect to the
applicant's activities; and
(4) copies of the applicant's audited financial statements,
including balance sheet, statement of income or loss, and
statement of changes in financial position, for the current year
and, if available, for the immediately preceding two-year period.
Subd. 5. [WAIVER.] The commissioner may, for good cause
shown, waive any requirement of this section with respect to any
license application or to permit a license applicant to submit
substituted information in its license application in lieu of
the information required by this section.
Sec. 9. [53B.08] [BOND OR OTHER SECURITY DEVICE.]
Subdivision 1. [REQUIREMENT.] Each application must be
accompanied by a surety bond, irrevocable letter of credit, or
other similar security device acceptable to the commissioner in
the amount of $50,000. If the applicant proposes to engage in
business under this chapter at more than one location, through
authorized delegates or otherwise, then the amount of the
security device must be increased by $10,000 per location, up to
a maximum of $250,000. The security device must be in a form
satisfactory to the commissioner and must run to the state for
the benefit of any claimants against the licensee to secure the
faithful performance of the obligations of the licensee with
respect to the receipt, handling, transmission, and payment of
money in connection with the sale and issuance of payment
instruments or transmission of money. In the case of a bond,
the aggregate liability of the surety in no event shall exceed
the principal sum of the bond. Claimants against the licensee
may themselves bring suit directly on the security device or the
commissioner may bring suit on behalf of these claimants, either
in one action or in successive actions.
Subd. 2. [ACCEPTABLE ALTERNATIVES.] In lieu of a security
device under subdivision 1 or of any portion of the principal of
the security device, as required by subdivision 1, the licensee
may deposit with the commissioner, or with banks in this state
that the licensee designates and the commissioner approves,
cash, interest-bearing stocks and bonds, notes, debentures, or
other obligations of the United States or any agency or
instrumentality of the United States, or guaranteed by the
United States, or of this state, or of a city, county, town,
village, school district, or instrumentality of this state, or
guaranteed by this state, to an aggregate amount, based upon
principal amount or market value, whichever is lower, of not
less than the amount of the security device or portion of the
security device. The securities or cash must be deposited and
held to secure the same obligations as would the security
device. The depositor shall receive all interest and
dividends. The depositor may, with the approval of the
commissioner, substitute other securities for those deposited,
and is required to do so on written order of the commissioner
made for good cause shown.
Subd. 3. [CANCELLATION.] The security device remains in
effect until cancellation, which may occur only after 30 days'
written notice to the commissioner. Cancellation does not
affect the rights of any claimant for any liability incurred or
accrued during the period for which the bond was in force.
Subd. 4. [DURATION.] The security device must remain in
place for no longer than five years after the licensee ceases
money transmission operations in the state. However,
notwithstanding this provision, the commissioner may permit the
security device to be reduced or eliminated before that time to
the extent that the amount of the licensee's payment instruments
outstanding in this state are reduced. The commissioner may
also permit a licensee to substitute a letter of credit or other
form of security device acceptable to the commissioner for the
security device in place at the time the licensee ceases money
transmission operations in the state.
Sec. 10. [53B.09] [APPLICATION FEE.]
Each application must be accompanied by a nonrefundable
application fee in the amount of $4,000.
Sec. 11. [53B.10] [ISSUANCE OF LICENSE.]
Subdivision 1. [INVESTIGATION.] Upon the filing of a
complete application, the commissioner shall investigate the
financial condition and responsibility, financial and business
experience, character, and general fitness of the applicant.
The commissioner may conduct an on-site investigation of the
applicant, the reasonable cost of which must be borne by the
applicant. If the commissioner finds that the requirements
imposed by this chapter have been met and that the required
license fee has been paid, the commissioner shall issue a
license to the applicant authorizing the applicant to engage in
the licensed activities in this state for a term of one year.
If these requirements have not been met, the commissioner shall
deny the application in writing, setting forth the reasons for
the denial.
Subd. 2. [DENIAL HEARING.] Any applicant aggrieved by a
denial issued by the commissioner under this section may at any
time within 30 days from the date of receipt of written notice
of the denial contest the denial by serving a response on the
commissioner. The commissioner shall set a date for a hearing
not later than 60 days after service of the response, unless a
later date is set with the consent of the denied applicant.
Sec. 12. [53B.11] [RENEWAL OF LICENSE AND ANNUAL REPORT.]
Subdivision 1. [FEE.] The annual fee for renewal of a
license under this chapter is $2,500.
Subd. 2. [REPORT.] The renewal fee must be accompanied by
a report, in a form prescribed by the commissioner. The form
must be sent by the commissioner to each licensee no later than
three months immediately preceding the date established by the
commissioner for license renewal. The licensee must include in
this annual renewal report:
(1) a copy of its most recent audited consolidated annual
financial statement, including balance sheet, statement of
income or loss, statement of changes in shareholder's equity,
and statement of changes in financial position, or, in the case
of a licensee that is a wholly owned subsidiary of another
corporation, the consolidated audited annual financial statement
of the parent corporation may be filed in lieu of the licensee's
audited annual financial statement;
(2) for the most recent quarter for which data are
available prior to the date of the filing of the renewal
application, but in no event more than 120 days prior to the
renewal date, the licensee must provide the number of payment
instruments sold by the licensee in the state, the dollar amount
of those instruments, and the dollar amount of those instruments
currently outstanding;
(3) any material changes to any of the information
submitted by the licensee on its original application that have
not previously been reported to the commissioner on any other
report required to be filed under this chapter;
(4) a list of the licensee's permissible investments; and
(5) a list of the locations within this state at which
business regulated by this chapter is being conducted by either
the licensee or its authorized delegate.
Subd. 3. [LICENSE DISPLAY.] A copy of the license issued
by the commissioner to the licensee shall be prominently
displayed in each location where money transmission services are
offered.
Sec. 13. [53B.12] [EXTRAORDINARY REPORTING REQUIREMENTS.]
Within 15 days of the occurrence of any one of the events
listed below, a licensee shall file a written report with the
commissioner describing the event and its expected impact on the
licensee's activities in the state:
(1) the filing for bankruptcy or reorganization by the
licensee;
(2) the institution of revocation or suspension proceedings
against the licensee by any state or governmental authority with
regard to the licensee's money transmission activities;
(3) any felony indictment of the licensee or any of its key
officers or directors related to money transmission activities;
or
(4) any felony conviction of the licensee or any of its key
officers or directors related to money transmission activities.
Sec. 14. [53B.13] [CHANGES IN CONTROL OF A LICENSEE.]
Any purchaser of ten percent or more of an ownership
interest in a licensee must notify the commissioner at least 30
days in advance of the purchase and submit a completed license
application form. The commissioner may revoke the license if
the new ownership would have resulted in a denial of the initial
license under this chapter. The commissioner may waive this
notification requirement if, in the commissioner's discretion,
the change in control does not pose any risk to the interests of
the public.
Sec. 15. [53B.14] [EXAMINATIONS.]
The commissioner has under this chapter the same powers
with respect to financial examinations that the commissioner has
under section 46.04.
Sec. 16. [53B.15] [MAINTENANCE OF RECORDS.]
Subdivision 1. [REQUIREMENT.] Each licensee shall make,
keep, and preserve the following books, accounts, and other
records for a period of three years:
(1) a record or records of each payment instrument sold;
(2) a general ledger containing all assets, liability,
capital, income, and expense accounts, which must be posted at
least monthly;
(3) bank statements and bank reconciliation records;
(4) records of outstanding payment instruments;
(5) records of each payment instrument paid within the
three-year period; and
(6) a list of the names and addresses of all of the
licensee's authorized delegates.
Subd. 2. [COMPLIANCE.] (a) Any licensee selling money
orders shall maintain a record of the date, amount, serial
number, and the location of the sale for each money order sold
in this state.
(b) Any licensee engaged in the business of receiving money
for transmission or transmitting money shall maintain a record
of the identity of the remitter, identity of the recipient,
amount of the transmission, date of the transaction, date funds
were transmitted, and the location from which the funds were
remitted for each transaction initiated in this state.
(c) Maintenance of the documents required by this section
in a photographic, electronic, or other similar form constitutes
compliance with this section.
Subd. 3. [LOCATION.] Records may be maintained at a
location other than within this state if they are made
accessible to the commissioner on seven days' written notice.
Sec. 17. [53B.16] [CONFIDENTIALITY OF DATA SUBMITTED TO
THE COMMISSIONER.]
Data or other information obtained by the commissioner
under this chapter, whether as a result of the license
application or renewal process or examinations, is subject to
chapter 13.
Sec. 18. [53B.17] [SOLVENCY REQUIRED.]
If the commissioner determines that a licensee is
insolvent, that its capital is impaired, or that its condition
is such as to render the continuance of its business hazardous
to the public or to those having funds in its custody, the
commissioner may apply to the district court for the county in
which the main office is located, or for Ramsey county if the
licensee does not have a main office in Minnesota, for
appointment of a receiver to receive the assets of the licensee
for the purpose of liquidating or rehabilitating its business
and for such other relief as the interest of the public may
require. The reasonable and necessary expenses of the
receivership have priority over all other claims on the bond
required by this chapter.
Sec. 19. [53B.18] [PROHIBITED PRACTICES.]
No licensee shall:
(1) fail to comply with chapter 345 as it relates to
unclaimed property requirements;
(2) refuse to indemnify an instrument holder for any
misappropriation of money caused by any of its authorized
delegates in conducting activities on behalf of the licensee for
whom it acts as an authorized delegate; or
(3) fail to transmit all money received for wire
transmission in accordance with the purchaser's instructions
within five days.
Sec. 20. [53B.19] [SUSPENSION OR REVOCATION OF LICENSES.]
After notice and hearing, the commissioner may suspend or
revoke a licensee's license if the commissioner finds that:
(1) any fact or condition exists that, if it had existed at
the time when the licensee applied for its license, would have
been grounds for denying the application;
(2) the licensee's net worth becomes inadequate and the
licensee, after ten days' written notice from the commissioner,
fails to take steps the commissioner considers necessary to
remedy the deficiency;
(3) the licensee violates any material provision of this
chapter or any rule or order validly adopted by the commissioner
under authority of this chapter;
(4) the licensee is conducting its business in an unsafe or
unsound manner;
(5) the licensee is insolvent;
(6) the licensee has suspended payment of its obligations,
has made an assignment for the benefit of its creditors, or has
admitted in writing its inability to pay its debts as they
become due;
(7) the licensee has applied for an adjudication of
bankruptcy, reorganization, arrangement, or other relief under
any bankruptcy;
(8) the licensee refuses to permit the commissioner to make
any examination authorized by this chapter; or
(9) the licensee fails to make any report required by this
chapter.
Sec. 21. [53B.20] [AUTHORIZED DELEGATE CONTRACTS.]
Subdivision 1. [CONTENTS OF CONTRACT.] Licensees that
conduct licensed activities through authorized delegates shall
authorize each delegate to operate under an express written
contract that, for contracts entered into after the effective
date of this chapter, provide the following:
(1) that the licensee appoint the person as its delegate
with authority to engage in money transmission on behalf of the
licensee;
(2) that neither a licensee nor an authorized delegate
authorize subdelegates without the written consent of the
commissioner; and
(3) that licensees are subject to supervision and
regulation by the commissioner and that as a part of that
supervision and regulation, the commissioner may require the
licensee to cancel an authorized delegate contract as a result
of a violation of section 53B.21.
Subd. 2. [TERMINATION OF AUTHORIZED DELEGATE
CONTRACT.] Upon termination of any authorized delegate contract,
the licensee must notify the commissioner within a reasonable
amount of time of the termination.
Subd. 3. [EXEMPT ENTITIES.] For purposes of this section,
"licensee" includes exempt entities.
Sec. 22. [53B.21] [AUTHORIZED DELEGATE CONDUCT.]
(a) An authorized delegate shall not make any fraudulent or
false statement or misrepresentation to a licensee or to the
commissioner.
(b) An authorized delegate shall conduct its money
transmission activities in a safe and sound manner.
(c) An authorized delegate shall cooperate with an
investigation conducted by the commissioner under this chapter
by providing any relevant information in its possession that the
commissioner cannot reasonably obtain from another source.
(d) An authorized delegate is under a duty to act only as
authorized under the contract with the licensee and any
authorized delegate who exceeds its authority is subject to
cancellation of its contract.
(e) All funds, less fees, received by an authorized
delegate of a licensee from the sale or delivery of a payment
instrument issued by a licensee or received by an authorized
delegate for transmission, constitute trust funds owned by and
belonging to the licensee from the time the funds are received
by the authorized delegate until the time when the funds or an
equivalent amount are remitted by the authorized delegate to the
licensee. If an authorized delegate commingles any funds with
other funds or property owned or controlled by the authorized
delegate, all commingled proceeds and other property must be
impressed with a trust in favor of the licensee in an amount
equal to the amount of the proceeds due the licensee.
(f) For purposes of this section, "licensee" includes
exempt entities.
Sec. 23. [53B.22] [LICENSEE LIABILITY.]
A licensee's responsibility to any person for a money
transmission conducted on that person's behalf by the licensee
or the licensee's authorized delegate is limited to the amount
of money tendered or the face amount of the payment instrument
purchased.
Sec. 24. [53B.23] [HEARINGS; PROCEDURES.]
The provisions of the Minnesota Administrative Procedure
Act, chapter 14, apply to any hearing under this chapter.
Sec. 25. [53B.24] [ENFORCEMENT.]
Section 45.027 applies to this chapter.
Sec. 26. [53B.25] [RULE NOTICES.]
At the time the commissioner files a notice of proposed
adoption, amendment, or repeal of a rule adopted under this
chapter, a copy of the notice must be sent by regular United
States mail, postage prepaid, to all then-current licensees and
applicants for licenses under this chapter.
Sec. 27. [53B.26] [APPOINTMENT OF COMMISSIONER AS AGENT
FOR SERVICE OF PROCESS.]
Subdivision 1. [CONSENT AND APPOINTMENT.] Any licensee,
authorized delegate, or other person who knowingly engages in
business activities that are regulated under this chapter, with
or without filing an application, is considered to have done
both of the following:
(1) consented to the jurisdiction of the courts of this
state for all actions arising under this chapter; and
(2) appointed the commissioner as the lawful agent for the
purpose of accepting service of process in any action, suit, or
proceeding that may arise under this chapter.
Subd. 2. [SERVICE OF PROCESS.] Service of process must be
made in accordance with section 45.028, subdivision 2.
Presented to the governor May 17, 2001
Signed by the governor May 21, 2001, 10:35 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes