74R9578 DWS-F
By Carona H.B. No. 1259
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to security obligations of a licensed seller of checks.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 9, The Sale of Checks Act (Article 489d,
1-5 Vernon's Texas Civil Statutes), is amended to read as follows:
1-6 Sec. 9. Obligations of Licensee. Each person holding a
1-7 license under this Act shall at all times when the license is in
1-8 effect:
1-9 (a) Maintain the bond or securities in the amount
1-10 prescribed by Section 7 and if<;>
1-11 <(b) If> the licensee does not have on file or deposit
1-12 a bond or securities, as aforesaid, in the undiminished principal
1-13 sum of at least Five Hundred Thousand Dollars ($500,000), file
1-14 quarterly reports with the Commissioner setting forth the locations
1-15 at which he sells checks in this state not later than the 45th day
1-16 after the date of the last day of each quarter of the licensee's
1-17 fiscal year <as of January 1, April 1, July 1, and October 1 in
1-18 each year, the report for each such date being due on or before the
1-19 15th day thereafter>;
1-20 (1) Within ten (10) days following the filing of
1-21 such a report, the principal sum of the bond or securities shall be
1-22 increased to reflect any increase in the number of locations, and
1-23 may be decreased to reflect any decrease in the number of
1-24 locations;
2-1 (2) If the Commissioner shall at any time
2-2 reasonably determine that the bond or securities aforesaid are
2-3 insecure, deficient in amount, or exhausted in whole or part, the
2-4 Commissioner <he> may by written order require the filing of a new
2-5 or supplemental bond or the deposit of new or additional securities
2-6 in order to secure compliance with this Act, such order to be
2-7 complied with within thirty (30) days following service thereof
2-8 upon the licensee;
2-9 (b) <(c)> Maintain a net worth equal to or greater
2-10 than the amount then currently prescribed by Section 5 for license
2-11 applicants; <and>
2-12 (c) If the licensee has a net worth of less than Five
2-13 Million Dollars ($5 million), as shown by audited financial
2-14 statements reasonably satisfactory to the Commissioner, maintain a
2-15 surety bond or letter of credit, or have <(d) Have> on hand
2-16 permissible investments, in an amount equal to the aggregate face
2-17 amount of all outstanding checks sold in the United States<, except
2-18 traveler's checks,> for which the licensee is liable for payment,
2-19 less the amount of the surety bond or deposit maintained under
2-20 Section 7(c) of this Act; and
2-21 (d) If the licensee has a net worth of Five Million
2-22 Dollars ($5 million) or more, as shown by audited financial
2-23 statements reasonably satisfactory to the Commissioner, maintain a
2-24 surety bond or letter of credit, or have on hand permissible
2-25 investments, in an amount equal to at least 50 percent of the
2-26 aggregate face amount of all outstanding checks sold in the United
2-27 States for which the licensee is liable for payment, less the
3-1 amount of the surety bond or deposit maintained under Section 7(c)
3-2 of this Act.
3-3 (e) If the licensee maintains a surety bond or letter
3-4 of credit under Subsection (c) or (d) of this section, the surety
3-5 bond or letter of credit must be:
3-6 (1) in addition to any other bond or security
3-7 required by this Act;
3-8 (2) issued by a bonding company or insurance
3-9 company authorized to do business in this state and acceptable to
3-10 the Commissioner, in the case of a surety bond;
3-11 (3) issued by a state or national bank, savings
3-12 bank, or savings and loan association acceptable to the
3-13 Commissioner, in the case of a letter of credit; and
3-14 (4) payable to the Commissioner on behalf of any
3-15 claimants against the licensee to secure the faithful performance
3-16 of the obligations of the licensee in the receipt, handling, and
3-17 payment of money in connection with the sale of checks. <however,
3-18 this subsection does not apply to any licensee with a net worth of
3-19 not less than Five Million Dollars ($5 million) as shown by audited
3-20 financial statements reasonably satisfactory to the Commissioner;
3-21 statements filed under Section 9B of this Act may be used to
3-22 satisfy this requirement.>
3-23 SECTION 2. Notwithstanding Subsection (d), Section 9, The
3-24 Sale of Checks Act (Article 489d, Vernon's Texas Civil Statutes),
3-25 as added by this Act, a person who is subject to that subsection
3-26 and who held a license under that Act on January 1, 1995, is
3-27 required to maintain for the license permissible investments or a
4-1 bond under that section in the following amounts:
4-2 (1) during the 12-month period beginning September 1,
4-3 1995, an amount equal to not less than 10 percent of the aggregate
4-4 face amount of all outstanding checks sold in the United States for
4-5 which the licensee is liable for payment, less the amount of the
4-6 surety bond or deposit maintained under Section 7(c), The Sale of
4-7 Checks Act (Article 489d, Vernon's Texas Civil Statutes);
4-8 (2) during the 12-month period beginning September 1,
4-9 1996, an amount equal to not less than 20 percent of the aggregate
4-10 face amount of all outstanding checks sold in the United States for
4-11 which the licensee is liable for payment, less the amount of the
4-12 surety bond or deposit maintained under Section 7(c), The Sale of
4-13 Checks Act (Article 489d, Vernon's Texas Civil Statutes);
4-14 (3) during the 12-month period beginning September 1,
4-15 1997, an amount equal to not less than 30 percent of the aggregate
4-16 face amount of all outstanding checks sold in the United States for
4-17 which the licensee is liable for payment, less the amount of the
4-18 surety bond or deposit maintained under Section 7(c), The Sale of
4-19 Checks Act (Article 489d, Vernon's Texas Civil Statutes);
4-20 (4) during the 12-month period beginning September 1,
4-21 1998, an amount equal to not less than 40 percent of the aggregate
4-22 face amount of all outstanding checks sold in the United States for
4-23 which the licensee is liable for payment, less the amount of the
4-24 surety bond or deposit maintained under Section 7(c), The Sale of
4-25 Checks Act (Article 489d, Vernon's Texas Civil Statutes); and
4-26 (5) on and after September 1, 1999, the amount
4-27 required by Subsection (d), Section 9, The Sale of Checks Act
5-1 (Article 489d, Vernon's Texas Civil Statutes), as added by this
5-2 Act.
5-3 SECTION 3. This Act takes effect September 1, 1995.
5-4 SECTION 4. The importance of this legislation and the
5-5 crowded condition of the calendars in both houses create an
5-6 emergency and an imperative public necessity that the
5-7 constitutional rule requiring bills to be read on three several
5-8 days in each house be suspended, and this rule is hereby suspended.