By: Carona S.B. No. 689
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
AN ACT
1-1 relating to an exemption from the Sale of Checks Act for electronic
1-2 funds transfers.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 152.002, Finance Code is amended to read
1-5 as follows:
1-6 In this chapter:
1-7 (1) "Account" has the meaning assigned by 15 U.S.C. Section
1-8 1693.
1-9 (2) [(1)] "Check" means an instrument for the transmission
1-10 or payment of money, including a draft, traveler's check, or money
1-11 order. The term also includes an instrument for the transmission
1-12 or payment of money in which the purchaser or remitter of the
1-13 instrument appoints or purports to appoint the seller as its agent
1-14 for the receipt, transmission, or handling of money, regardless of
1-15 who signs the instrument.
1-16 (3) [(2)] "Commission" means the Finance Commission of
1-17 Texas.
1-18 (4) [(3)] "Commissioner" means the banking commissioner of
1-19 Texas.
1-20 (5) [(4)] "Deliver" means to deliver a check to the first
1-21 person who in payment for the check remits or purports to remit the
1-22 face amount of the check or makes a remittance or purported
2-1 remittance against the face amount, regardless of whether the
2-2 person who delivers the check:
2-3 (A) signs the check; or
2-4 (B) charges a fee in addition to the face amount.
2-5 (6) [(5)] "Department" means the Texas Department of
2-6 Banking.
2-7 (7) [(6)] "Permissible investment" means:
2-8 (A) cash;
2-9 (B) an investment security that is an obligation:
2-10 (i) of the United States or an instrumentality
2-11 of the United States;
2-12 (ii) the principal and interest of which are
2-13 fully guaranteed by the United States; or
2-14 (iii) of a state or a political subdivision of a
2-15 state; or
2-16 (C) any other investment approved by the commissioner.
2-17 (8) [(7)] "Person" means an individual, partnership, joint
2-18 stock or other association, trust, or corporation. The term does
2-19 not include the United States or this state.
2-20 (9) [(8)] "Sell" includes issue or deliver.
2-21 (10) [(9)] "Traveler's check" means a type of check that:
2-22 (A) is a multiple of a denomination;
2-23 (B) provides for the purchaser's signature to be
2-24 completed at the same time the instrument is purchased; and
2-25 (C) provides for the purchaser's countersignature to
2-26 be completed when the instrument is negotiated.
3-1 SECTION 2. Section 152.202, Finance Code is amended to read
3-2 as follows:
3-3 (a) Section 152.201 does not apply to:
3-4 (1) a bank, credit union, savings and loan association, or
3-5 savings bank, whether the institution is state or federal, if the
3-6 institution does not sell checks, other than traveler's checks:
3-7 (A) off premises; or
3-8 (B) through an agent who is not directly or indirectly
3-9 owned by the institution unless the agent is a federally insured
3-10 bank, credit union, savings and loan association, or savings bank;
3-11 (2) an agent or subagent of a license holder unless the
3-12 agent or subagent sells the license holder's checks
3-13 over-the-counter to the public and in the regular conduct of that
3-14 business receives or at any time has access to:
3-15 (A) a check of the license holder that is returned
3-16 after payment for verification, reconciliation, or accounting; or
3-17 (B) a bank statement relating to a returned check;
3-18 (3) a title company or attorney that issues an escrow or
3-19 trust fund check;
3-20 (4) the United States; or
3-21 (5) with the commissioner's prior written consent, a person
3-22 who:
3-23 (A) holds a license issued under Chapter 153;
3-24 (B) has a net worth of at least $250,000 and meets the
3-25 licensing requirements of this chapter;
3-26 (C) maintains a bond under Section 152.206 in the
4-1 minimum principal amount of $350,000; and
4-2 (D) sells checks only in conjunction with a currency
4-3 exchange or transmission transaction, as defined by Chapter 153,
4-4 and separates all proceeds from that transaction from the sale of
4-5 checks.
4-6 (b) Section 152.201 does not apply to any transfer of funds that
4-7 is subject to 12 C.F.R. Part 205, Regulation E, if the Person
4-8 receiving authorization to debit or credit an account is:
4-9 (1) subject to audit by any federal regulatory authority;
4-10 (2) subject to audit by a depository financial institution;
4-11 (3) deemed an acceptable risk under the policies of the
4-12 depository financial institution; and
4-13 (4) registered with the Securities and Exchange Commission
4-14 as a corporation with stockholder equity of no less than $100
4-15 million.
4-16 (c) [(b)] Notwithstanding Subsection (a)(5), a person who
4-17 meets the requirements of that subsection is subject to:
4-18 (1) any other provision of this chapter to the extent the
4-19 person engages in the business of selling checks; and
4-20 (2) rules adopted by the commissioner to administer and
4-21 carry out that subsection, including rules to:
4-22 (A) define a term used in that subsection; and
4-23 (B) establish limits or requirements on the bonding
4-24 and net worth of the person and the person's activities relating to
4-25 the sale of checks other than those specified by that subsection.
4-26 SECTION 3. Effective Date. This act takes effect on
5-1 September 1, 1999.
5-2 SECTION 4. EMERGENCY. The crowded condition of the
5-3 calendars in both houses create an emergency and an imperative
5-4 public necessity that the constitutional rule requiring bills to be
5-5 read on three several days in each house be suspended, and this
5-6 rule is hereby suspended, and that this Act take effect and be in
5-7 force from and after its passage, and it is so enacted.