2001 Minnesota Statutes

CHAPTER 53B. Minnesota money transmitters act

     53B.01 Citation. 

    This chapter may be cited as the "Minnesota Money 
 Transmitters Act." 

    HIST: 2001 c 148 s 2 

     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. 

    HIST: 2001 c 148 s 3 

     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. 

    HIST: 2001 c 148 s 4 

     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. 

    HIST: 2001 c 148 s 5 

     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. 

    HIST: 2001 c 148 s 6 

     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. 

    HIST: 2001 c 148 s 7 

     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. 

    HIST: 2001 c 148 s 8 

     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. 

    HIST: 2001 c 148 s 9 

     53B.09 Application fee. 

    Each application must be accompanied by a nonrefundable 
 application fee in the amount of $4,000. 

    HIST: 2001 c 148 s 10 

     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. 

    HIST: 2001 c 148 s 11 

     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. 

    HIST: 2001 c 148 s 12 

     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. 

    HIST: 2001 c 148 s 13 

     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. 

    HIST: 2001 c 148 s 14 

     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. 

    HIST: 2001 c 148 s 15 

     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. 

    HIST: 2001 c 148 s 16 

     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. 

    HIST: 2001 c 148 s 17 

     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. 

    HIST: 2001 c 148 s 18 

     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. 

    HIST: 2001 c 148 s 19 

     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. 

    HIST: 2001 c 148 s 20 

     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 August 1, 2001, 
 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. 

    HIST: 2001 c 148 s 21 

     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. 

    HIST: 2001 c 148 s 22 

     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. 

    HIST: 2001 c 148 s 23 

     53B.23 Hearings; procedures. 

    The provisions of the Minnesota Administrative Procedure 
 Act, chapter 14, apply to any hearing under this chapter. 

    HIST: 2001 c 148 s 24 

     53B.24 Enforcement. 

    Section 45.027 applies to this chapter. 

    HIST: 2001 c 148 s 25 

     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. 

    HIST: 2001 c 148 s 26 

     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. 

    HIST: 2001 c 148 s 27