AN ACT TO ENACT THE NORTH CAROLINA MONEY TRANSMITTERS ACT AS REQUESTED BY THE OFFICE OF THE NORTH CAROLINA COMMISSIONER OF BANKS.
Enacts new Article 16B, the North Carolina Money Transmitters Act in GS Chapter 53. Sets out the terms and their definitions as they apply to the Article. Defines money transmission as engaging in the business of: (1) sale or issuance of payment instruments or stored value primarily for personal, family, or household purposes or (2) receiving money or monetary value for transmission or holding funds incidental to transmission within the United States or to locations abroad by any and all means, including payment instruments, stored value, wire, facsimile, or electronic transfer primarily for personal, family, or household purposes; specifies that this includes maintaining control of virtual currency on behalf of others.
Prohibits engaging in the business of money transmission without being licensed. Specifies that a person is considered to be engaged in the business of money transmission in this state if that person solicits or advertises money transmission services from a Web site that North Carolina citizens may access in order to enter into those transactions by electronic means. Specifies entities exempted from the licensing requirement. Allows licensees to authorize delegates to engage in money transmission on their behalf subject to an express written agreement, specifies content of the agreement, and requires licensees to maintain full charge, control, and supervision of any authorized delegate. Allows the Commissioner of Banks (Commissioner) to also exempt any person or transaction if the Commissioner finds that such action is in the public interest and regulation of the person or transaction is not necessary for the Article's purposes.
Requires applications for licensure to be filed through the Nationwide Mortgage Licensing System and Registry (NMLS) and specifies information that must be included in the application.
Requires applicants to possess and requires licensees to maintain a net worth of no less than $250,000. Allows the Commissioner to increase the amount if it is necessary to ensure safe and sound operation based on the consideration of nine specified factors.
Requires applicants to post a surety bond and requires licensees to maintain a surety bond in the amount of $150,000. Sets out requirements for adjusting the amount of the bond. Sets out further provisions governing the bond.
Requires licensees to possess at all times unencumbered permissible investments that have an aggregate market value of no less than the aggregate face amount of all outstanding transmission obligations. Allows the requirement to be waived by the Commissioner under specified circumstances. Deems permissible investments to be held in trust for the benefit of the purchasers and holders of the licensee's outstanding payment instruments and stored value obligations in the event of bankruptcy.
Requires the payment of a $1,500 application fee. Also requires licensees to pay an annual assessment with the amount dependent on the licensee's transmission dollar volume.
Sets out the procedure for the Commissioner to follow in determining whether to grant a license.
Prohibits licensees from performing specified acts.
Requires licensees to maintain books, accounts, and other records the Commissioner requires for no less than three years and specifies what must be included in those records. Requires licensees to notify the Commissioner of any change in the location of records within 10 days.
Requires licensees to file annual and quarterly reports that include specified information. Failure to timely submit the reports is grounds for summary suspension.
Requires a licensee to notify the Commissioner within 15 days of a change or acquisition of control of a licensee. Requires a licensee to file a written report with the Commissioner within 15 days of the occurrence of four specified events related to bankruptcy, reorganization, revocation or suspension proceedings, or specified felony indictments or convictions.
Sets out provisions governing the Commissioner's powers of investigation and examination of compliance.
Allows the Commissioner to deny, suspend, revoke, or refuse to issue a license or limit the manner in which a licensee or applicant engages in money transmission if it is in the public interest and any of 12 specified circumstances exist, including that the licensee has conducted business in an unsafe or unsound manner, the licensee or applicant has violated or failed to comply with the Article or related rules or orders, or that the licensee fails to make any required report.
Requires all administrative actions and hearings under the Article to proceed according to the requirements for administrative hearings under the Administrative Procedure Act. Sets out further details concerning the Commissioner's disciplinary authority.
Makes it a Class 1 misdemeanor to knowingly and willfully: (1) violate any provision of this Article for which a penalty is not specifically provided, (2) make a material, false statement in any document filed or required to be filed under this Article with the intent to deceive the recipient of the document, and (3) engage in the business of money transmission without a license.
Makes all information or reports obtained by the Commissioner subject to confidential treatment. Allows the Commissioner to enter agreements or sharing arrangements with other governmental agencies or associations representing them and share otherwise confidential information, with limitations.
Allows the State Banking Commission to adopt rules implementing the Article. Provides for appeals to the State Banking Commission.
Deems any person subject to the Article as (1) consenting to the jurisdiction of the courts of this state for all actions arising under this Article and (2) appointing the Secretary of State as such person's agent for the purpose of accepting service of process in any action, suit, or proceeding that may arise under this Article. Deems the Commissioner to have complied with the requirements of law concerning service of process by mailing by certified mail any notice required or permitted to a person subject to this Article, postage prepaid and addressed to the last known address on file with the Commissioner.
Allows the Commissioner to require all persons subject to the Article to be licensed through NMLS and sets out additional requirements and allowances concerning NMLS.
Includes a severability clause.
Allows any person who holds a money transmitter's license in good standing issued by the Commissioner on or after November 1, 2014, to continue to engage in such business subject to the Article's requirements.
Repeals Article 16A of GS Chapter 53, Money Transmitter's Act.
Effective October 1, 2015.
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