79R7098 CLG-F
By: McCall H.B. No. 2218
Substitute the following for H.B. No. 2218:
By: Orr C.S.H.B. No. 2218
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of money services businesses; providing
a penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle E, Title 3, Finance Code, is amended by
adding Chapter 151 to read as follows:
CHAPTER 151. REGULATION OF MONEY SERVICES BUSINESSES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 151.001. SHORT TITLE. This chapter may be cited as the
Money Services Act.
Sec. 151.002. DEFINITIONS. (a) This section defines
general terms that apply to an applicant for or holder of a money
services license issued under this chapter, regardless of whether
the license is a money transmission license or a currency exchange
license. Additional terms that apply specifically to money
transmission are defined in Section 151.301. Additional terms that
apply specifically to currency exchange are defined in Section
151.501.
(b) In this chapter:
(1) "Applicant" means a person that files an
application for a license under this chapter.
(2) "Authorized delegate" means a person a license
holder appoints under Section 151.402 to conduct money transmission
on behalf of the license holder.
(3) "Bank Secrecy Act" means the Bank Secrecy Act (31
U.S.C. Section 5311 et seq.), and its implementing regulations set
forth at 31 C.F.R. Part 103.
(4) "Commission" means the Finance Commission of
Texas.
(5) "Commissioner" means the Banking Commissioner of
Texas or a person designated by the banking commissioner and acting
under the banking commissioner's direction and authority.
(6) "Control" means ownership of, or the power to
directly or indirectly vote, 25 percent or more of the outstanding
voting interests of a license holder or applicant, and includes an
individual whose ownership is through one or more legal entities.
(7) "Currency exchange" has the meaning assigned by
Section 151.501.
(8) "Currency exchange license" means a license issued
under Subchapter F.
(9) "Department" means the Texas Department of
Banking.
(10) "Executive officer" means a president, a
presiding officer of the executive committee, a treasurer or chief
financial officer, or any other individual who performs similar
functions.
(11) "License holder" means a person that holds a
money transmission license or a currency exchange license.
(12) "Location" means a place at which activity
regulated by this chapter occurs.
(13) "Material litigation" means any litigation that,
according to generally accepted accounting principles, is
considered significant to an applicant's or license holder's
financial health and would be required to be referenced in that
entity's audited financial statements, report to shareholders, or
similar documents.
(14) "Money services" means money transmission or
currency exchange.
(15) "Money transmission" has the meaning assigned by
Section 151.301.
(16) "Money transmission license" means a license
issued under Subchapter D.
(17) "Person" means an individual or legal entity.
(18) "Principal" means:
(A) with respect to a sole proprietorship, an
owner; or
(B) with respect to a legal entity other than a
sole proprietorship, an executive officer, director, general
partner, trustee, or manager, as applicable.
(19) "Record" means information that is:
(A) inscribed on a tangible medium; or
(B) stored in an electronic or other medium and
retrievable in perceivable form.
(20) "Responsible individual" means an individual who
has direct control over or significant management policy and
decision-making authority with respect to a license holder's
ongoing, daily money services operations in this state.
(21) "USA PATRIOT ACT" means the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001
(Pub. L. No. 107-56, 115 Stat. 272).
Sec. 151.003. EXCLUSIONS. The following persons are not
required to be licensed under this chapter:
(1) the United States or an instrumentality of the
United States, including the United States Post Office or a
contractor acting on behalf of the United States Post Office;
(2) a state or an agency, political subdivision, or
other instrumentality of a state;
(3) a federally insured financial institution, as that
term is defined by Section 201.101, that is organized under the laws
of this state, another state, or the United States;
(4) a foreign bank branch or agency in the United
States established under the federal International Banking Act of
1978 (12 U.S.C. Section 3101 et seq.);
(5) a person acting as an agent for an entity excluded
under Subdivision (3) or (4), to the extent of the person's actions
in that capacity, provided that:
(A) the entity is liable for satisfying the money
services obligation owed to the purchaser on the person's receipt
of the purchaser's money; and
(B) the entity and person enter into a written
contract that appoints the person as the entity's agent and the
person acts only within the scope of authority conferred by the
contract;
(6) a person that, on behalf of the United States or a
department, agency, or instrumentality of the United States, or a
state or county, city, or any other governmental agency or
political subdivision of a state, provides electronic funds
transfer services of governmental benefits for a federal, state,
county, or local governmental agency;
(7) a person that acts as an intermediary on behalf of
and at the direction of a license holder in the process by which the
license holder, after receiving money or monetary value from a
purchaser, either directly or through an authorized delegate,
transmits the money or monetary value to the purchaser's designated
recipient, provided that the license holder is liable for
satisfying the obligation owed to the purchaser;
(8) an attorney or title company that in connection
with a real property transaction receives and disburses domestic
currency or issues an escrow or trust fund check only on behalf of a
party to the transaction;
(9) a person engaged in the business of currency
transportation who is both a registered motor carrier under Chapter
643, Transportation Code, and a licensed armored car company or
courier company under Chapter 1702, Occupations Code, provided that
the person does not engage in the money transmission or currency
exchange business without a license issued under this chapter; and
(10) any other person, transaction, or class of
persons or transactions exempted by commission rule or any other
person or transaction exempted by the commissioner's order on a
finding that the licensing of the person is not necessary to achieve
the purposes of this chapter.
[Sections 151.004-151.100 reserved for expansion]
SUBCHAPTER B. ADMINISTRATIVE PROVISIONS
Sec. 151.101. ADMINISTRATION. The department shall
administer this chapter.
Sec. 151.102. RULES. (a) The commission may adopt rules to
administer and enforce this chapter, including rules necessary or
appropriate to:
(1) implement and clarify this chapter;
(2) preserve and protect the safety and soundness of
money services businesses;
(3) protect the interests of purchasers of money
services and the public;
(4) protect against drug trafficking, terrorist
funding, and money laundering, structuring, or a related financial
crime; and
(5) recover the cost of maintaining and operating the
department and the cost of administering and enforcing this chapter
and other applicable law by imposing and collecting proportionate
and equitable fees and costs for notices, applications,
examinations, investigations, and other actions required to
achieve the purposes of this chapter.
(b) The presence or absence of a specific reference in this
chapter to a rule regarding a particular subject is not intended to
and does not limit the general rulemaking authority granted to the
commission by this section.
Sec. 151.103. COMMISSIONER'S GENERAL AUTHORITY. (a) Each
power granted to the commissioner under this chapter is in addition
to, and not in limitation of, each other power granted under this
chapter. The fact that the commissioner possesses, or has
exercised, a power under a provision of this chapter does not
preclude the commissioner from exercising a power under any other
provision of this chapter.
(b) Each power granted to the commissioner under this
chapter is in addition to, and not in limitation of, powers granted
to the commissioner under other law. The fact that the commissioner
possesses, or has exercised, a power under any other provision of
law does not preclude the commissioner from exercising any power
under this chapter. The fact that the commissioner possesses, or
has exercised, a power under a provision of this chapter does not
preclude the commissioner from exercising a power under any other
law.
(c) The commissioner may impose on any authority, approval,
exemption, license, or order issued or granted under this chapter
any condition the commissioner considers reasonably necessary or
appropriate to carry out and achieve the purposes of this chapter.
Sec. 151.104. INVESTIGATIONS. (a) The commissioner may
conduct investigations in or outside this state and the United
States as the commissioner considers necessary or appropriate to
administer and enforce this chapter, including investigations to:
(1) determine whether to approve an application for or
renewal of a license or a request for approval or exemption filed
under this chapter or a rule adopted or order issued under this
chapter;
(2) determine whether a person has violated or is
likely to violate this chapter or a rule adopted or order issued
under this chapter;
(3) determine whether a license or authorized delegate
designation should be revoked or suspended;
(4) otherwise aid in the enforcement of this chapter
or a rule adopted or order issued under this chapter; and
(5) aid in the adoption of rules or issuance of orders
under this chapter.
(b) For purposes of an investigation, examination, or other
proceeding under this chapter, the commissioner may administer or
cause to be administered oaths, subpoena witnesses, compel the
attendance of witnesses, take evidence, and require the production
of any document that the commissioner determines to be relevant to
the inquiry.
(c) If a person refuses to obey a subpoena, a district court
of Travis County, on application by the commissioner, may issue an
order requiring the person to appear before the commissioner and
produce documents or give evidence regarding the matter under
investigation.
(d) The commissioner may employ a person or request the
attorney general, the Department of Public Safety, or any other
state, federal, or local law enforcement agency to assist in
enforcing this chapter.
(e) The commissioner may recover the reasonable costs
incurred in connection with an investigation conducted under this
chapter from the person that is the subject of the investigation.
Sec. 151.105. REGULATORY COOPERATION. (a) To efficiently
and effectively administer and enforce this chapter and to minimize
regulatory burden, the commissioner may cooperate, coordinate, and
share information with another state, federal, or foreign
governmental agency that:
(1) regulates or supervises persons engaged in money
services businesses or activities subject to this chapter; or
(2) is authorized to investigate or prosecute
violations of a state, federal, or foreign law related to persons
engaged in money services businesses or activities subject to this
chapter, including a state attorney general's office.
(b) The commissioner, with respect to an agency described by
and for the purposes set forth in Subsection (a), may:
(1) enter into a written cooperation, coordination, or
information-sharing contract or agreement with the agency;
(2) share information with the agency, subject to the
confidentiality provisions of Section 151.606(b)(3);
(3) conduct a joint or concurrent on-site examination
or other investigation or enforcement action with the agency;
(4) accept a report of examination or investigation
by, or a report submitted to, the agency, in which event the
accepted report is an official report of the commissioner for all
purposes;
(5) engage the services of the agency to assist the
commissioner in performing or discharging a duty or responsibility
imposed by this chapter or other law and pay a reasonable fee for
the services;
(6) share with the agency any supervisory or
examination fees assessed against a license holder or authorized
delegate under this chapter and receive a portion of supervisory or
examination fees assessed by the agency against a license holder or
authorized delegate; and
(7) take other action as the commissioner considers
reasonably necessary or appropriate to carry out and achieve the
purposes of this chapter.
(c) The commissioner may not waive, and nothing in this
section constitutes a waiver of, the commissioner's authority to
conduct an examination or investigation or otherwise take
independent action authorized by this chapter or a rule adopted or
order issued under this chapter to enforce compliance with
applicable state or federal law.
(d) A joint examination or investigation, or acceptance of
an examination or investigation report, does not waive an
examination assessment provided for in this chapter.
(e) Chapter 2254, Government Code, does not apply to a
contract or agreement entered into under this section.
Sec. 151.106. CONSENT TO SERVICE OF PROCESS. A license
holder, an authorized delegate, or a person who knowingly engages
in activities that are regulated and require a license under this
chapter, with or without filing an application for a license or
holding a license under this chapter, is considered to have
consented to the jurisdiction of the courts of this state for all
actions arising under this chapter.
[Sections 151.107-151.200 reserved for expansion]
SUBCHAPTER C. GENERAL QUALIFICATIONS AND PROVISIONS
APPLICABLE TO MONEY SERVICES LICENSES
Sec. 151.201. SCOPE. This subchapter sets out the general
qualifications and provisions that apply to a money services
license, regardless of whether the license is a money transmission
license or a currency exchange license. Subchapters D and E set
forth the additional qualifications and provisions that apply
specifically to a money transmission license. Subchapter F sets
forth the additional qualifications and provisions that apply
specifically to a currency exchange license.
Sec. 151.202. QUALIFICATIONS FOR LICENSE. (a) Subject to
Subsections (b) and (c), to qualify for a license under this
chapter, an applicant must demonstrate to the satisfaction of the
commissioner that:
(1) the financial responsibility and condition,
financial and business experience, competence, character, and
general fitness of the applicant justify the confidence of the
public and warrant the belief that the applicant will conduct
business in compliance with this chapter and the rules adopted
under this chapter and other applicable state and federal law;
(2) the issuance of the license is in the public
interest;
(3) the applicant, a principal of the applicant, or a
person in control of the applicant does not owe the department a
delinquent fee, assessment, administrative penalty, or other
amount imposed under this chapter or a rule adopted or order issued
under this chapter;
(4) the applicant, if a partnership, and any partner
that would generally be liable for the obligations of the
partnership, does not owe a delinquent federal tax;
(5) the applicant, if a corporation:
(A) is in good standing and statutory compliance
in the state or country of incorporation;
(B) is authorized to engage in business in this
state; and
(C) does not owe any delinquent franchise or
other taxes to this state;
(6) the applicant, if not a corporation, is properly
registered under the laws of this state or another state or country
and, if required, is authorized to engage in business in this state;
and
(7) the applicant, a principal of the applicant, or a
principal of a person in control of the applicant is not listed on
the specifically designated nationals and blocked persons list
prepared by the United States Department of the Treasury, or
designated successor agency, as a potential threat to commit or
fund terrorist acts.
(b) In determining whether an applicant has demonstrated
satisfaction of the qualifications identified in Subsection
(a)(1), the commissioner shall consider the financial
responsibility and condition, financial and business experience,
competence, character, and general fitness of each principal of,
person in control of, principal of a person in control of, and
proposed responsible individual of the applicant and may deny
approval of the application on the basis that the applicant has
failed to demonstrate satisfaction of the requisite qualifications
with respect to one or more of those persons.
(c) The commissioner may not issue a license to an applicant
if the applicant or one of the following persons has been convicted
within the preceding 10 years of a criminal offense specified in
Subsection (e):
(1) if the applicant is an individual, the spouse or
proposed responsible individual or individuals of the applicant;
(2) if the applicant is an entity that is wholly owned,
directly or indirectly, by a single individual, the spouse of the
individual; or
(3) if the applicant is a person other than an
individual, a principal of, person in control of, principal of a
person in control of, or proposed responsible individual or
individuals of the applicant.
(d) The commissioner, on a finding that the conviction does
not reflect adversely on the present likelihood that the applicant
will conduct business in compliance with this chapter, rules
adopted under this chapter, and other applicable state and federal
law, may waive a disqualification under Subsection (c) based on the
conviction of a spouse or a corporate applicant or corporate person
in control of an applicant.
(e) For purposes of Subsection (c), a disqualifying
conviction is a conviction for a felony criminal offense:
(1) under state or federal law that involves or
relates to:
(A) deception, dishonesty, or defalcation;
(B) money transmission or other money services,
including a reporting, recordkeeping or registration requirement
of the Bank Secrecy Act, the USA PATRIOT ACT, or Chapter 271;
(C) money laundering, structuring, or a related
financial crime;
(D) drug trafficking; or
(E) terrorist funding; and
(2) under a similar law of a foreign country unless the
applicant demonstrates to the satisfaction of the commissioner that
the conviction was based on extenuating circumstances unrelated to
the person's reputation for honesty and obedience to law.
(f) For purposes of Subsection (c), a person is considered
to have been convicted of an offense if the person has been found
guilty or pleaded guilty or nolo contendere to the charge or has
been placed on probation or deferred adjudication without regard to
whether a judgment of conviction has been entered by the court.
Sec. 151.203. APPLICATION FOR LICENSE. (a) An application
for a license under this chapter must be made under oath and in the
form and medium required by the commissioner. The application must
contain:
(1) the legal name and residential and business
address of the applicant and each principal of the applicant;
(2) the taxpayer identification number, social
security number, driver's license number, or other identifying
information the commissioner requires of the applicant and each
principal of the applicant; and
(3) any other information or documentation the
commissioner reasonably requires to determine whether the
applicant qualifies for and should be issued the license for which
application is made.
(b) The commissioner, at the time the application is
submitted or in connection with an investigation of the application
under Section 151.204, may require the applicant, the spouse of the
applicant, a principal of, individual who is a person in control of,
or proposed responsible individual of the applicant, or any other
individual associated with the applicant and the proposed licensed
activities, to provide the department a complete set of
fingerprints for purposes of a criminal background investigation.
(c) An applicant must certify in writing on the application
that the applicant and each principal of, person in control of, and
proposed responsible individual of the applicant:
(1) is familiar with and agrees to fully comply with
all applicable state and federal laws and regulations pertaining to
the applicant's proposed money services business, including this
chapter, relevant provisions of the Bank Secrecy Act, the USA
PATRIOT ACT, and Chapter 271;
(2) has not within the preceding three years knowingly
failed to file or evaded the obligation to file a report, including
a currency transaction or suspicious activity report required by
the Bank Secrecy Act, the USA PATRIOT ACT, or Chapter 271; and
(3) has not knowingly accepted money for transmission
or exchange in which a portion of the money was derived from an
illegal transaction or activity.
(d) The commissioner may waive an application requirement
or permit the submission of substituted information in lieu of the
information generally required in an application, either with
respect to a specific applicant or a category of applicants, if the
commissioner determines that the waiver or substitution of
information is consistent with achievement of the purposes of this
chapter.
Sec. 151.204. PROCESSING AND INVESTIGATION OF APPLICATION.
(a) An application for a license under this chapter shall be
processed and acted on according to the time periods established by
commission rule.
(b) On receipt of an application that meets the requirements
of Section 151.203 and Section 151.304 or 151.504, as applicable,
the commissioner shall investigate the applicant to determine
whether the prescribed qualifications have been met. The
commissioner may:
(1) conduct an on-site investigation of the applicant;
(2) employ a screening service to assist with the
investigation;
(3) to the extent the commissioner considers
reasonably necessary to evaluate the application and the
applicant's qualifications, investigate the financial
responsibility and condition, financial and business experience,
character and general fitness of each principal of, person in
control of, principal of a person in control of, or proposed
responsible individual of the applicant or any other person that is
or will be associated with the applicant's licensed activities in
this state; or
(4) require additional information and take other
action the commissioner considers reasonably necessary.
(c) The commissioner may collect from the applicant the
reasonable expenses of an on-site examination or third-party
investigation. Additionally, depending on the nature and extent of
the investigation required in connection with a particular
application, the commissioner may require an applicant to pay a
non-refundable investigation fee in an amount established by
commission rule.
(d) The commissioner may suspend consideration of an
application for a license if the applicant or a principal of, person
in control of, or proposed responsible individual of the applicant
is the subject of a pending state or federal criminal prosecution,
state or federal government enforcement action, or state or federal
asset forfeiture proceeding until the conclusion of the
prosecution, action, or proceeding.
Sec. 151.205. ISSUANCE OF LICENSE. (a) The commissioner
shall issue a license if the commissioner, with respect to the
license for which application has been made, finds that:
(1) the applicant meets the prescribed qualifications
and it is reasonable to believe that the applicant's business will
be conducted fairly and lawfully, according to applicable state and
federal law, and in a manner commanding the public's trust and
confidence;
(2) the issuance of the license is in the public
interest;
(3) the documentation and forms required to be
submitted by the applicant are acceptable; and
(4) the applicant has satisfied all requirements for
licensure.
(b) If the commissioner finds that the applicant for any
reason fails to possess the qualifications or satisfy the
requirements for the license for which application is made, the
commissioner shall inform the applicant in writing that the
application is denied and state the reasons for the denial. The
applicant may appeal the denial by filing a written request for a
hearing with the commissioner not later than the 30th day after the
date the notice is mailed. A hearing on the denial must be held not
later than the 45th day after the date the commissioner receives the
written request unless the administrative law judge extends the
period for good cause or the parties agree to a later hearing date.
The hearing is considered a contested case hearing and is subject to
Section 151.801.
Sec. 151.206. TRANSFER OR ASSIGNMENT OF LICENSE. A license
issued under this chapter may not be transferred or assigned.
Sec. 151.207. RENEWAL OF LICENSE. (a) Regardless of the
date on which a license under this chapter is issued, the license
expires on August 15 of each year unless the license is renewed in
accordance with this section or is previously surrendered by the
license holder or suspended or revoked by the commissioner.
(b) As a condition of renewal, a license holder must
continue to possess the qualifications and satisfy the requirements
that apply to an applicant for a new money transmission license or
currency exchange license, as applicable. Additionally, not later
than July 1 of each year, a license holder must:
(1) pay an annual renewal fee in an amount established
by commission rule; and
(2) submit a renewal report that is under oath, is in
the form and medium required by the commissioner, and contains:
(A) if the license is a money transmission
license, an audited unconsolidated financial statement dated as of
the last day of the license holder's fiscal year that ended in the
immediately preceding calendar year;
(B) if the license is a currency exchange
license, a financial statement, audited or unaudited, dated as of
the last day of the license holder's fiscal year that ended in the
immediately preceding calendar year; and
(C) documentation and certification, or any
other information the commissioner reasonably requires to
determine the security, net worth, permissible investments, and
other requirements the license holder must satisfy and whether the
license holder continues to meet the qualifications and
requirements for licensure.
(c) If the department does not receive a license holder's
renewal fee and complete renewal report on or before July 1, the
commissioner shall notify the license holder in writing that:
(1) the license holder has until August 15 to submit
the renewal report and pay the renewal fee; and
(2) the license holder must pay a late fee, in an
amount that is established by commission rule and not subject to
appeal, for each business day after July 1 that the commissioner
does not receive the completed renewal report and renewal fee.
(d) If the license holder fails to submit the completed
renewal report and pay the renewal fee and any late fee due, the
license expires effective 5 p.m. central daylight time on August
15, and the license holder must cease and desist from engaging in
the business of money transmission or currency exchange, as
applicable, as of that time. The expiration of a license is not
subject to appeal.
(e) On timely receipt of a license holder's complete renewal
report, renewal fee, and any late fee due, the department shall
review the report and, if necessary, investigate the business and
records of the license holder. On completion of the review and
investigation, if any, the commissioner may:
(1) renew the license;
(2) impose conditions on the renewal of the license
the commissioner may consider reasonably necessary or appropriate;
or
(3) suspend or revoke the license on the basis of a
ground specified in Section 151.703.
(f) On written application and for good cause shown, the
commissioner may extend the time for filing the fee and report
required under this section.
(g) The holder or principal of or the person in control of
the holder of an expired license, or the holder or principal of or
person in control of the holder of a license surrendered under
Section 151.208, that wishes to conduct activities for which a
license is required under this chapter must file a new license
application and satisfy all requirements for licensure that apply
at the time the new application is filed.
Sec. 151.208. SURRENDER OF LICENSE. (a) A license holder
may surrender the license holder's license by delivering the
original license to the commissioner along with a written notice of
surrender that includes the location at which the license holder's
records will be stored and the name, address, telephone number, and
other contact information for an individual who is authorized to
provide access to the records.
(b) A license holder shall surrender the license holder's
license if the license holder becomes ineligible for a license
under Section 151.202(c).
(c) The surrender of a license does not reduce or eliminate
a license holder's civil or criminal liability arising from any
acts or omissions before the surrender of the license, including
any administrative action undertaken by the commissioner to deny
the renewal of a license, to revoke or suspend a license, to assess
an administrative penalty, to order the payment of restitution, or
to exercise any other authority under this chapter. Further, the
surrender of a license does not release the security required of the
license holder under Section 151.307 or 151.506.
Sec. 151.209. REFUNDS. A fee or cost paid under this
chapter in connection with an application or renewal is not
refundable.
[Sections 151.210-151.300 reserved for expansion]
SUBCHAPTER D. MONEY TRANSMISSION LICENSE
Sec. 151.301. DEFINITIONS. (a) This section defines terms
that apply to an applicant for or holder of a money transmission
license issued under this subchapter.
(b) In this subchapter:
(1) "Currency" means the coin and paper money of the
United States or another country that is designated as legal tender
and circulates and is customarily used and accepted as a medium of
exchange in the country of issuance.
(2) "Electronic instrument" means a card or other
tangible object for the transmission, transfer, or payment of money
or monetary value, that contains an electronic chip or strip for the
storage of information or that provides access to information.
(3) "Money" or "monetary value" means currency or a
claim that can be converted into currency through a financial
institution, electronic payments network, or other formal or
informal payment system.
(4) "Money transmission" means the receipt of money or
monetary value by any means in exchange for a promise to make the
money or monetary value available at a later time or different
location. The term:
(A) includes:
(i) selling or issuing stored value or
payment instruments, including checks, money orders, and
traveler's checks;
(ii) receiving money or monetary value for
transmission, including by payment instrument, wire, facsimile,
electronic transfer, or ACH debit;
(iii) providing third-party bill paying
services; or
(iv) receiving currency or an instrument
payable in currency to physically transport the currency or its
equivalent from one location to another by motor vehicle or other
means of transportation or through the use of the mail or a
shipping, courier, or other delivery service; and
(B) does not include the provision solely of
online or telecommunication services or connection services to the
Internet.
(5) "Outstanding" means:
(A) with respect to a payment instrument or
stored value, a payment instrument or stored value that has been
issued and sold in the United States directly by the license holder,
or sold by an authorized delegate of the license holder in the
United States and reported to the license holder, that has not yet
been paid by or for the license holder; or
(B) with respect to transmission, a money
transmission for which the license holder, directly or through an
authorized delegate of the license holder, has received money or
monetary value from the customer for transmission, but has not yet
completed the money transmission by delivering the money or
monetary value to the person designated by the customer or refunded
the money or monetary value to the customer.
(6) "Payment instrument" means a written or electronic
equivalent of a check, draft, money order, traveler's check, or
other written or electronic instrument, service, or device for the
transmission or payment of money or monetary value, sold or issued
to one or more persons, regardless of whether negotiable. The term
does not include an instrument, service, or device that:
(A) transfers money directly from a purchaser to
a creditor of the purchaser or to an agent of the creditor;
(B) is redeemed by the issuer in goods or
services or a cash or credit refund under circumstances not
designed to evade the obligations and responsibilities imposed by
this chapter; or
(C) is a credit card voucher or letter of credit.
(7) "Receive" means to obtain possession of money or
monetary value in a manner that cannot be reversed through the
exercise of routine contractual or statutory rights.
(8) "Stored value" means monetary value evidenced by
an electronic record that is prefunded and for which value is
reduced on each use. The term does not include an electronic record
that is:
(A) loaded with points, miles, or other
nonmonetary value; or
(B) not sold to the public but distributed as a
reward or charitable donation.
(9) "Unsafe or unsound act or practice" means a
practice of or conduct by a license holder or an authorized delegate
of the license holder that creates the likelihood of material loss,
insolvency, or dissipation of the license holder's assets, or that
otherwise materially prejudices the interests of the license holder
or the license holder's customers.
Sec. 151.302. LICENSE REQUIRED. (a) A person may not
engage in the business of money transmission or advertise, solicit,
or hold itself out as a person that engages in the business of money
transmission unless the person:
(1) is licensed under this subchapter;
(2) is an authorized delegate of a person licensed
under this subchapter, appointed by the license holder in
accordance with Section 151.402;
(3) is excluded from licensure under Section 151.003;
or
(4) has been granted an exemption under Subsection
(c).
(b) For purposes of this chapter:
(1) a person engages in the business of money
transmission if the person conducts money transmission for persons
located in this state and receives compensation or expects to
receive compensation, directly or indirectly, for conducting the
transmissions; and
(2) a person solicits, advertises, or holds itself out
as a person that engages in the business of money transmission if
the person represents that the person will conduct money
transmission for persons located in this state.
(c) On application and a finding that the exemption is in
the public interest, the commissioner may exempt a person that:
(1) incidentally engages in the money transmission
business only to the extent reasonable and necessary to accomplish
a primary business objective unrelated to the money transmission
business;
(2) does not advertise or offer money transmission
services to the public except to the extent reasonable and
necessary to fairly advertise or offer the person's primary
business services; and
(3) either transmits money exclusively in connection
with commercial contracts in interstate commerce or does not charge
a fee to transmit money or transmits money without a fee as an
inducement for customer participation in the person's primary
business.
(d) A license holder may engage in the money transmission
business at one or more locations in this state owned, directly or
indirectly by the license holder, or through one or more authorized
delegates, or both, under a single license granted to the license
holder.
Sec. 151.303. ADDITIONAL QUALIFICATIONS. In addition to
the general qualifications for licensure set forth in Section
151.202, an applicant for a money transmission license must
demonstrate to the satisfaction of the commissioner that:
(1) the applicant has and will maintain the minimum
net worth required under Section 151.307;
(2) the applicant's financial condition will enable
the applicant to safely and soundly engage in the business of money
transmission; and
(3) the applicant does not engage in any activity or
practice that adversely affects the applicant's safety and
soundness.
Sec. 151.304. APPLICATION AND ACCOMPANYING FEE,
STATEMENTS, AND SECURITY. (a) An applicant for a money
transmission license must submit an application in accordance with
Section 151.203.
(b) At the time an application for a money transmission
license is submitted, an applicant must file with the department:
(1) an application fee in the amount established by
commission rule;
(2) audited financial statements that are
satisfactory to the commissioner for purposes of determining
whether the applicant has the minimum net worth required under
Section 151.307 and is likely to maintain the required minimum net
worth if a license is issued; and
(3) security in the amount of $300,000, that meets the
requirements of Section 151.308, and an undertaking or agreement
that the applicant will increase or supplement the security to
equal the aggregate security required by the commissioner under
that section before the issuance of the license and the start of
operations.
Sec. 151.305. INVESTIGATION AND ACTION ON APPLICATION. The
commissioner shall investigate the applicant and act on the
application in accordance with Sections 151.204 and 151.205.
Sec. 151.306. TEMPORARY LICENSE. (a) The commissioner may
issue a temporary license to a person that is engaging in money
transmission, but has not obtained a license under this subchapter,
if the person:
(1) certifies in writing that the person qualifies for
the license and will submit a completed license application not
later than the 60th day after the date the temporary license is
issued;
(2) submits a recent financial statement acceptable to
the commissioner that reflects the minimum net worth required under
Section 151.307;
(3) provides security that meets the requirements of
Section 151.308 in an amount specified by the commissioner, but not
less than $300,000;
(4) agrees in writing that, until a permanent license
is issued, the person will engage only in activities being
conducted at existing locations; and
(5) pays the application fee and a nonrefundable
temporary license fee in the amount established by commission rule.
(b) The effective period for a temporary license may not
exceed 90 days from the date the license is issued, provided that
the commissioner may extend the period for not more than an
additional 30 days if necessary to complete the processing of a
timely filed application for which approval is likely.
Sec. 151.307. NET WORTH. (a) An applicant for a money
transmission license must possess, and a money transmission license
holder must maintain at all times, a minimum net worth computed in
accordance with generally accepted accounting principles of:
(1) $100,000, if business is proposed to be or is
conducted, directly or through an authorized delegate, at four or
fewer locations; or
(2) $500,000, if business is proposed to be or is
conducted, directly or through an authorized delegate, at five or
more locations.
(b) The commissioner may increase the amount of net worth
required of an applicant or license holder, up to a maximum of $1
million, if the commissioner determines, with respect to the
applicant or license holder, that a higher net worth is necessary to
achieve the purposes of this chapter based on:
(1) the nature and volume of the projected or
established business;
(2) the number of locations at or through which money
transmission is or will be conducted;
(3) the amount, nature, quality, and liquidity of its
assets;
(4) the amount and nature of its liabilities;
(5) the history of its operations and prospects for
earning and retaining income;
(6) the quality of its operations;
(7) the quality of its management;
(8) the nature and quality of its principals and
persons in control;
(9) the history of its compliance with applicable
state and federal law; and
(10) any other factor the commissioner considers
relevant.
Sec. 151.308. SECURITY. (a) An applicant for a money
transmission license must provide, and a money transmission license
holder must maintain at all times, security consisting of a surety
bond, an irrevocable letter of credit, or a deposit instead of a
bond in accordance with this section.
(b) The amount of the required security is the greater of
$300,000 or an amount equal to one percent of the license holder's
total yearly dollar volume of money transmission business in this
state or the applicant's projected total volume of business in this
state for the first year of licensure, up to a maximum of $2
million. When the amount of the required security exceeds $1
million, the applicant or license holder may, in the alternative,
provide security in the amount of $1 million, plus a dollar for
dollar increase in the net worth of the applicant or license holder
over the amount required under Section 151.307, up to a total amount
of $2 million.
(c) The security must:
(1) be in a form satisfactory to the commissioner;
(2) be payable to any claimant or to the commissioner,
on behalf of a claimant or this state, for any liability arising out
of the license holder's money transmission business in this state,
incurred under, subject to, or by virtue of this chapter;
(3) be conditioned on the faithful compliance of the
license holder or the principals, responsible individuals,
employees and authorized delegates of the license holder with this
chapter or any rule adopted or order issued under this chapter; and
(4) if the security is a bond, be issued by a qualified
surety company authorized to engage in business in this state and
acceptable to the commissioner or, if the security is an
irrevocable letter of credit, be issued by a financial institution
acceptable to the commissioner.
(d) A claimant may bring suit directly on the security, or
the commissioner may bring suit on behalf of the claimant or the
state, either in one action or in successive actions.
(e) The commissioner may collect from the security or
proceeds of the security any delinquent fee, assessment, cost,
penalty, or other amount imposed on and owed by a license holder.
If the security is a surety bond, the commissioner shall give the
surety reasonable prior notice of a hearing to impose an
administrative penalty against the license holder, provided that a
surety may not be considered an interested, aggrieved, or affected
person for purposes of an administrative proceeding under Section
151.801 or Chapter 2001, Government Code.
(f) The security remains in effect until canceled, which may
occur only after providing 30 days' written notice to the
commissioner. Cancellation does not affect any liability incurred
or accrued during the period covered by the security.
(g) The security shall cover claims for at least five years
after the license holder surrenders its license or otherwise ceases
to engage in activities for which a license is required under this
subchapter. However, the commissioner may permit the amount of the
security to be reduced or eliminated before that time to the extent
that the amount of the license holder's obligations to the
department and to purchasers in this state is reduced. The
commissioner may permit a license holder to substitute another form
of security when the license holder ceases to provide money
transmission in this state.
(h) If the commissioner at any time reasonably determines
that the required security is insecure, deficient in amount, or
exhausted in whole or in part, the commissioner by written order
shall require the license holder to file or make new or additional
security to comply with this section.
(i) Instead of providing all or part of the amount of the
security required by this section, an applicant or license holder
may deposit, with a financial institution possessing trust powers
that is authorized to conduct a trust business in this state and is
acceptable to the commissioner, an aggregate amount of United
States currency, certificates of deposit, or other cash equivalents
that equals the total amount of the required security or the
remaining part of the security. The deposit:
(1) must be held in trust in the name of and be pledged
to the commissioner;
(2) must secure the same obligations as the security;
and
(3) is subject to other conditions and terms the
commissioner may reasonably require.
(j) The security is considered by operation of law to be
held in trust for the benefit of this state and any individual to
whom an obligation arising under this chapter is owed, and may not
be considered an asset or property of the license holder in the
event of bankruptcy, receivership, or a claim against the license
holder unrelated to the license holder's obligations under this
chapter.
Sec. 151.309. PERMISSIBLE INVESTMENTS. (a) A money
transmission license holder must maintain at all times permissible
investments that have an aggregate market value computed in
accordance with generally accepted accounting principles in an
amount not less than:
(1) if the license holder has a net worth of less than
$5 million, the aggregate face amount of the license holder's
average outstanding money transmission obligations in the United
States, computed in the manner prescribed by commission rule; or
(2) if the license holder has a net worth of $5 million
or more, 50 percent of the amount required by Subdivision (1).
(b) Except to the extent limited by Subsection (d), the
following constitute a permissible investment for purposes of this
section:
(1) 40 percent of the receivables due a license holder
from authorized delegates resulting from money transmission under
this chapter that is not past due or doubtful of collection;
(2) cash in demand or interest-bearing accounts with a
federally insured depository institution, including certificates
of deposit;
(3) certificates of deposit or senior debt obligations
of a domestic federally insured depository institution that are
readily marketable and insured by an agency of the federal
government;
(4) investment grade bonds and other legally created
general obligations of a state, an agency or political subdivision
of a state, the United States, or an instrumentality of the United
States;
(5) obligations that a state, an agency or political
subdivision of a state, the United States, or an instrumentality of
the United States has unconditionally agreed to purchase, insure,
or guarantee and that bear a rating of one of the three highest
grades as defined by a nationally recognized organization that
rates securities;
(6) shares in a money market mutual fund if the mutual
fund, under the terms of the mutual fund's governing documents, is
authorized to invest only in securities of the type described by
Subdivisions (4) and (5) or permitted by commission rule; and
(7) other assets and investments permitted by rule of
the commission or approved by the commissioner in writing, based on
a determination that the assets or investments have a safety
substantially equivalent to other permissible investments.
(c) In addition to investments listed in Subsection (b), a
permissible investment for purposes of Subsection (a) includes:
(1) the security provided under Section 151.308;
(2) a surety bond or letter of credit in addition to
the security provided under Section 151.308, if the additional
surety bond or letter of credit satisfies the requirements of
Section 151.308; and
(3) that portion of a surety bond maintained for the
benefit of the purchasers of the license holder's outstanding money
transmission obligations in another state that is not in excess of
the amount of the outstanding obligations in that state, provided:
(A) the license holder maintains a surety bond or
letter of credit or has on hand other permissible investments, or a
combination of investments, in an amount sufficient to satisfy the
requirements of Subsection (a) with respect to the outstanding
money transmission obligations in this state; and
(B) the surety bond is issued by a surety rated
within the top two rating categories of a nationally recognized
United States rating service.
(d) The commissioner, with respect to a license holder, may
limit or disallow for purposes of determining compliance with
Subsection (a) an investment, surety bond, or letter of credit
otherwise permitted by this section if the commissioner determines
it to be unsatisfactory for investment purposes or to pose a
significant supervisory concern.
(e) A permissible investment subject to this section, even
if commingled with other assets of the license holder, is
considered by operation of law to be held in trust for the benefit
of any individual to whom an obligation arising under this chapter
is owed, and may not be considered an asset or property of the
license holder in the event of bankruptcy, receivership, or a claim
against the license holder unrelated to any of the license holder's
obligations under this chapter.
[Sections 151.310-151.400 reserved for expansion]
SUBCHAPTER E. CONDUCT OF MONEY TRANSMISSION BUSINESS
Sec. 151.401. LIABILITY OF LICENSE HOLDER. A money
transmission license holder is liable for the payment of all money
or monetary value received for transmission either directly or
through an authorized delegate appointed in accordance with Section
151.402.
Sec. 151.402. CONDUCT OF BUSINESS THROUGH AUTHORIZED
DELEGATE. (a) A money transmission license holder may conduct
business regulated under this chapter through an authorized
delegate appointed by the license holder in accordance with this
section. A license holder is responsible for the acts of the
authorized delegate, of which the license holder has or reasonably
should have knowledge, that are conducted pursuant to the authority
granted by the license holder and that relate to the license
holder's money transmission business.
(b) Before a license holder is authorized to conduct
business through an authorized delegate or allows a person to act as
the license holder's authorized delegate, the license holder must:
(1) adopt, and update as necessary, written policies
and procedures designed to ensure that the license holder's
authorized delegate complies with applicable state and federal law;
(2) enter into a written contract that complies with
Subsection (c); and
(3) conduct a reasonable risk-based background
investigation sufficient for the license holder to determine
whether the authorized delegate has complied with applicable state
and federal law.
(c) The written contract required by Subsection (b)(2) must
be signed by the license holder and the authorized delegate and, at
a minimum, must:
(1) appoint the person signing the contract as the
license holder's authorized delegate with the authority to conduct
money transmission on behalf of the license holder;
(2) set forth the nature and scope of the relationship
between the license holder and the authorized delegate and the
respective rights and responsibilities of the parties;
(3) require the authorized delegate to certify that
the delegate is familiar with and agrees to fully comply with all
applicable state and federal laws, rules, and regulations
pertaining to money transmission, including this chapter and rules
adopted under this chapter, relevant provisions of the Bank Secrecy
Act and the USA PATRIOT ACT, and Chapter 271;
(4) require the authorized delegate to remit and
handle money and monetary value in accordance with Sections
151.403(b) and (c);
(5) impose a trust on money and monetary value
received in accordance with Section 151.404;
(6) require the authorized delegate to prepare and
maintain records as required by this chapter or a rule adopted under
this chapter or as reasonably requested by the commissioner;
(7) acknowledge that the authorized delegate consents
to examination or investigation by the commissioner;
(8) state that the license holder is subject to
regulation by the commissioner and that, as part of that
regulation, the commissioner may suspend or revoke an authorized
delegate designation or require the license holder to terminate an
authorized delegate designation;
(9) acknowledge receipt of the written policies and
procedures required under Subsection (b)(1); and
(10) acknowledge that the authorized delegate has been
provided regulatory website addresses through which the authorized
delegate can access this chapter and rules adopted under this
chapter and the Bank Secrecy Act, the USA PATRIOT ACT, and Chapter
271.
(d) A license holder must report to the commissioner the
theft or loss of payment instruments or stored value from the
license holder or an authorized delegate in this state if the total
value of the instruments or stored value exceeds $10,000. The
license holder must make the report as soon as the license holder
has knowledge of the theft or loss.
(e) A license holder must notify the license holder's
authorized delegates and require the delegates to take any action
required by the commissioner if the license holder:
(1) fails to renew the license holder's license; or
(2) is subject to an emergency or final order that
affects the conduct of the license holder's business through an
authorized delegate.
(f) A license holder must maintain a current list of
authorized delegates located in this state that includes the name
and business address of each delegate and must provide the list to
the commissioner on request. A license holder that engages in
business through 11 or more authorized delegates located in this
state must include on the license holder's website a list of the
names and addresses of the authorized delegates of the license
holder located in this state and the delegates' business addresses.
The license holder must update the list quarterly.
(g) The commission by rule may exempt from one or more of the
requirements of this chapter an authorized delegate that is a
federally insured financial institution excluded under Section
151.003(3) or a foreign bank branch or agency excluded under
Section 151.003(4).
Sec. 151.403. AUTHORIZED DELEGATE CONDUCT. (a) An
authorized delegate of a license holder:
(1) is under a duty to and must act only as authorized
under the contract with the license holder and in strict compliance
with the license holder's written policies and procedures;
(2) must not commit fraud or misrepresentation or make
any fraudulent or false statement or misrepresentation to a license
holder or the commissioner;
(3) must cooperate with an investigation or
examination conducted by the commissioner and is considered to have
consented to the commissioner's examination of the delegate's books
and records;
(4) must not commit an unsafe or unsound act or
practice or conduct business in an unsafe and unsound manner;
(5) must, on discovery, immediately report to the
license holder the theft or loss of payment instruments or stored
value;
(6) must prominently display on the form prescribed by
the commissioner a notice that indicates that the person is an
authorized delegate of the license holder under this subchapter;
and
(7) must cease to provide money services as an
authorized delegate of a license holder or take other required
action immediately on receipt of notice from the commissioner or
the license holder as provided by Section 151.402(e).
(b) An authorized delegate shall remit all money owed to the
license holder:
(1) not later than the 10th business day after the date
the authorized delegate receives the money;
(2) in accordance with the contract between the
license holder and the authorized delegate; or
(3) as directed by the commissioner.
(c) Notwithstanding Subsection (b)(1), an authorized
delegate may remit the money at a later date if the authorized
delegate maintains on deposit with an office of a federally insured
financial institution located in the United States an amount that:
(1) is in an account solely in the name of the license
holder; and
(2) for each day by which the period before the
remittance exceeds 10 business days, is not less than the
outstanding obligations of the license holder routinely incurred by
the authorized delegate on a daily basis.
(d) Any business for which a license is required under this
subchapter that is conducted by an authorized delegate outside the
scope of authority conferred in the contract between the authorized
delegate and the license holder is unlicensed activity.
Sec. 151.404. TRUST IMPOSED. (a) A license holder shall
hold in trust all money received for transmission directly or from
an authorized delegate from the time of receipt until the time the
transmission obligation is discharged. A trust resulting from the
license holder's actions is in favor of the persons to whom the
related money transmission obligations are owed.
(b) A license holder's authorized delegate shall hold in
trust all money received for transmission by or for the license
holder from the time of receipt until the time the money is remitted
by the authorized delegate to the license holder. A trust resulting
from the authorized delegate's actions is in favor of the license
holder.
(c) A license holder's authorized delegate may not
commingle the money received for transmission by or for the license
holder with the authorized delegate's own money or other property,
except to use in the ordinary course of the delegate's business for
the purpose of making change, if the money is accounted for at the
end of each business day.
(d) If a license holder or the license holder's authorized
delegate commingles any money received for transmission with money
or other property owned or controlled by the license holder or
delegate, all commingled money and other property are impressed
with a trust as provided by this section in an amount equal to the
amount of money received for transmission, less the amount of fees
paid for the transmission.
(e) If the commissioner revokes a license holder's license
under Section 151.703, all money held in trust by the license holder
and the license holder's authorized delegates is assigned to the
commissioner for the benefit of the persons to whom the related
money transmission obligations are owed.
(f) Money of a license holder or authorized delegate
impressed with a trust under this section may not be considered an
asset or property of the license holder or authorized delegate in
the event of bankruptcy, receivership, or a claim against the
license holder or authorized delegate unrelated to the license
holder's or delegate's obligations under this chapter.
Sec. 151.405. DISCLOSURE REQUIREMENTS. (a) A license
holder's name and mailing address or telephone number must be
provided to the purchaser in connection with each money
transmission transaction conducted by the license holder directly
or through an authorized delegate.
(b) A license holder receiving currency or an instrument
payable in currency for transmission must comply with Chapter 278.
[Sections 151.406-151.500 reserved for expansion]
SUBCHAPTER F. CURRENCY EXCHANGE LICENSE
Sec. 151.501. DEFINITIONS. (a) This section defines terms
that apply specifically to an applicant for or holder of a currency
exchange license issued under this subchapter.
(b) In this subchapter:
(1) "Currency" means the coin and paper money of the
United States or any country that is designated as legal tender and
circulates and is customarily used and accepted as a medium of
exchange in the country of issuance.
(2) "Currency exchange" means exchanging the currency
of one government for the currency of another government.
Sec. 151.502. LICENSE REQUIRED. (a) A person may not
engage in the business of currency exchange or advertise, solicit,
or hold itself out as providing currency exchange unless the
person:
(1) is licensed under this subchapter;
(2) is licensed for money transmission under
Subchapter D;
(3) is an authorized delegate of a person licensed for
money transmission under Subchapter D;
(4) is excluded under Section 151.003; or
(5) has been granted an exemption under Subsection
(d).
(b) For purposes of this chapter, a person engages in the
business of currency exchange if the person exchanges currency and
receives compensation or expects to receive compensation, directly
or indirectly, for the currency exchange.
(c) A license holder may engage in the currency exchange
business at one or more locations in this state owned, directly or
indirectly by the license holder, under a single license.
(d) On application and a finding that the exemption is in
the public interest, the commissioner may exempt a retailer,
wholesaler, or service provider that in the ordinary course of
business accepts currency of a foreign country or government as
payment for goods or services, provided that a person is not
eligible for the exemption if:
(1) the value of the goods or services purchased in a
single transaction exceeds $10,000;
(2) the change given or made as a result of the
transaction exceeds $100;
(3) an attempt is made to structure a transaction in a
manner that evades the licensing requirements of this subchapter or
avoids using a business licensed under this chapter;
(4) the person is engaged in the business of cashing
checks, drafts, or other payment instruments for consideration and
is not otherwise exempt from licensing under this chapter; or
(5) the person would not be eligible for a license
under this chapter.
(e) In accordance with the investigation provisions of this
chapter, the commissioner may examine a person to verify the
person's exempt status under Subsection (d).
Sec. 151.503. QUALIFICATIONS. An applicant for a currency
exchange license must have the qualifications set forth in Section
151.202.
Sec. 151.504. APPLICATION AND ACCOMPANYING FEE AND
SECURITY. (a) An applicant for a currency exchange license must
submit an application in accordance with Section 151.203.
(b) At the time an application for a currency exchange
license is submitted, an applicant must file with the department:
(1) an application fee in the amount established by
commission rule; and
(2) security in the amount of $2,500 that meets the
requirements of Section 151.506.
Sec. 151.505. INVESTIGATION AND ACTION ON APPLICATION. The
commissioner shall investigate the applicant and act on the
application in accordance with Sections 151.204 and 151.205.
Sec. 151.506. SECURITY. An applicant for a currency
exchange license must provide and a currency exchange license
holder must maintain at all times security in the amount of $2,500
that satisfies the requirements of and is subject to Sections
151.308(c)-(j).
[Sections 151.507-151.600 reserved for expansion]
SUBCHAPTER G. EXAMINATIONS, REPORTS, AND RECORDS
Sec. 151.601. EXAMINATIONS. (a) The commissioner may
examine a license holder or authorized delegate of a license holder
as reasonably necessary or appropriate to administer and enforce
this chapter and rules adopted and orders issued under this chapter
and other applicable law, including the Bank Secrecy Act, the USA
PATRIOT ACT, and Chapter 271.
(b) The commissioner may:
(1) conduct an examination annually or at other times
as the commissioner may reasonably require;
(2) conduct an on-site examination or an off-site
review of records;
(3) conduct an examination in conjunction with an
examination conducted by representatives of other state agencies or
agencies of another state or of the federal government;
(4) accept the examination report of another state
agency or an agency of another state or of the federal government,
or a report prepared by an independent accounting firm, which on
being accepted is considered for all purposes as an official report
of the commissioner; and
(5) summon and examine under oath a principal,
responsible individual, or employee of a license holder or
authorized delegate of a license holder and require the person to
produce records regarding any matter related to the condition and
business of the license holder or authorized delegate.
(c) A license holder or authorized delegate of a license
holder shall provide, and the commissioner shall have full and
complete access to, all records the commissioner may reasonably
require to conduct a complete examination. The records must be
provided at the location and in the format specified by the
commissioner.
(d) Unless otherwise directed by the commissioner, a
license holder shall pay all costs reasonably incurred in
connection with an examination of the license holder or the license
holder's authorized delegate.
(e) Disclosure of information to the commissioner under an
examination request does not waive or otherwise affect or diminish
confidentiality or a privilege to which the information is
otherwise subject. Information disclosed to the commissioner in
connection with an examination is confidential under Section
151.606.
Sec. 151.602. RECORDS. (a) A license holder must prepare,
maintain, and preserve the following books, accounts, and other
records for at least five years or another period as may be
prescribed by rule of the commission:
(1) a record of each money transmission transaction or
currency exchange transaction, as applicable;
(2) a general ledger posted in accordance with
generally accepted accounting principles containing all asset,
liability, capital, income, and expense accounts, unless directed
otherwise by the commissioner;
(3) bank statements and bank reconciliation records;
(4) all records and reports required by applicable
state and federal law, including the reporting and recordkeeping
requirements imposed by the Bank Secrecy Act, the USA PATRIOT ACT,
and Chapter 271, and other federal and state laws pertaining to
money laundering, drug trafficking, or terrorist funding; and
(5) any other records required by commission rule or
reasonably requested by the commissioner to determine compliance
with this chapter.
(b) The records required under this section may be:
(1) maintained in a photographic, electronic, or other
similar form; and
(2) maintained at the license holder's principal place
of business or another location as may be reasonably requested by
the commissioner.
(c) An authorized delegate must prepare, maintain, and
preserve the records required by commission rule or reasonably
requested by the commissioner.
(d) The records required under this section are subject to
inspection by the commissioner under Section 151.601.
(e) The records required under this section and the reports
required under Section 151.603 must be in English and the financial
information contained in the records and reports must be
denominated in United States dollars.
Sec. 151.603. REPORTS. (a) An applicant or license holder
shall file a written report with the commissioner not later than the
15th day after the date the applicant or license holder knows or has
reason to know of a material change in the information reported in
an application or renewal report. The report must describe the
change and the anticipated impact of the change on the activities of
the applicant or license holder in this state.
(b) A money transmission license holder shall prepare
written reports and statements as follows:
(1) the renewal report required by Section
151.207(b)(2), including an audited unconsolidated financial
statement that is dated as of the last day of the license holder's
fiscal year that ended in the immediately preceding calendar year;
(2) a quarterly interim financial statement and report
regarding the permissible investments required to be maintained
under Section 151.309 that reflect the license holder's financial
condition and permissible investments as of the last day of the
calendar quarter to which the statement and report relate and that
are prepared not later than the 45th day after the last day of the
calendar quarter; and
(3) any other report required by rule of the
commission or reasonably requested by the commissioner to determine
compliance with this chapter.
(c) A currency exchange license holder shall prepare a
written report or statement as follows:
(1) the renewal report required by Section
151.207(b)(2), including a financial statement that may be audited
or unaudited and that is dated as of the last day of the license
holder's fiscal year that ended in the immediately preceding
calendar year;
(2) a quarterly interim financial statement and
transaction report that reflects the license holder's financial
condition and currency exchange business as of the last day of the
calendar quarter to which the statement and report relate and that
are prepared not later than the 45th day after the last day of the
calendar quarter; and
(3) any other report required by rule of the
commission or reasonably requested by the commissioner to determine
compliance with this chapter.
(d) A license holder shall file the statements and reports
required under this section with the commissioner as required by
this chapter, by commission rule, or as requested by the
commissioner.
(e) On written application and for good cause shown, the
commissioner may extend the time for preparing or filing a
statement or report required under this section.
Sec. 151.604. EXTRAORDINARY REPORTING REQUIREMENTS. (a) A
license holder shall file a written report with the commissioner
not later than the 15th day after the date the license holder knows
or has reason to know of a material change in the information
reported in an application or renewal report. The report must
describe the change and the anticipated impact of the change on the
license holder's activities in this state.
(b) A license holder must file a written report with the
commissioner not later than 24 hours after the license holder knows
or has reason to know of:
(1) the filing of a petition by or against the license
holder for bankruptcy or reorganization;
(2) the filing of a petition by or against the license
holder for receivership, the commencement of any other judicial or
administrative proceeding for its dissolution or reorganization,
or the making of a general assignment for the benefit of the license
holder's creditors;
(3) the institution of a proceeding to revoke or
suspend the license holder's license, or to enjoin or otherwise
require the license holder to cease and desist from engaging in an
activity related to money transmission, by a state or country in
which the license holder engages in business or is licensed;
(4) the felony indictment or conviction of the license
holder or a principal of, person in control of, responsible
individual of, or authorized delegate of the license holder for an
offense identified in Section 151.202(e);
(5) the cancellation or other impairment of the
license holder's security; or
(6) the inability to meet the license holder's
transmission obligations under this chapter for a period of 24
hours or longer.
Sec. 151.605. CHANGE OF CONTROL. (a) This section applies
to a proposed change of control of a license holder that results in
a person or group of persons acting in concert, a "proposed person
in control," after consummation of the acquisition transaction,
controlling the license holder or a person in control of a license
holder.
(b) A person may not directly or indirectly acquire control
of a license holder or a person in control of a license holder
without the prior written approval of the commissioner, except as
provided by this section.
(c) A license holder or proposed person in control shall:
(1) give the commissioner written notice of a proposed
change of control at least 45 days before the date the proposed
transaction is to be consummated;
(2) request approval of the proposed change of
control; and
(3) submit a nonrefundable fee in an amount
established by commission rule.
(d) A proposed person in control is subject to the same
standards and qualifications that apply to a principal of an
applicant for a new license under this chapter. The commissioner
may require the license holder or proposed person in control to
provide the same type of information, documentation, and
certifications and may conduct the same type of investigation the
commissioner requires and conducts in connection with a new license
application.
(e) The commissioner shall approve a proposed change of
control if the commissioner determines that the proposed person in
control has the financial responsibility, financial condition,
business experience, competence, character, and general fitness to
warrant the belief that the business of the license holder will be
conducted in compliance with this chapter, rules adopted under this
chapter, and other applicable state and federal law and that the
change of control will not jeopardize the public interest.
(f) If the commissioner determines that the proposed person
in control fails to meet the qualifications, standards, and
requirements of this chapter, the commissioner shall inform the
license holder and the proposed person in control in writing that
the application is denied and state the reasons for the denial. The
license holder or the proposed person in control may appeal the
denial by filing a written request for a hearing with the
commissioner not later than the 30th day after the date the notice
is mailed. A hearing on the denial must be held not later than the
45th day after the date the commissioner receives the written
request unless the administrative law judge extends the period for
good cause or the parties agree to a later hearing date. The
hearing is considered a contested case hearing and is subject to
Section 151.801.
(g) The following persons are exempt from the requirements
of Subsection (a), but the license holder must notify the
commissioner not later than the 15th day after the date the change
of control becomes effective:
(1) a person that acts as proxy for the sole purpose of
voting at a designated meeting of the security holders or holders of
voting interests of a license holder or controlling person;
(2) a person that acquires control of a license holder
by devise or descent;
(3) a person that acquires control as a personal
representative, custodian, guardian, conservator, or trustee, or
as an officer appointed by a court or by operation of law;
(4) a person exempted in the public interest by rule of
the commission or by order of the commissioner; and
(5) a person that has previously complied with and
received approval under this chapter or that was identified as a
person in control in a prior application filed with and approved by
the commissioner.
(h) Subsection (b) does not apply to a public offering of
securities.
(i) Before filing an application for approval of a proposed
change of control, a license holder may submit a written request
asking the commissioner to determine whether a person would be
considered a proposed person in control of the license holder and
whether the requirements of this section apply to the proposed
transaction. The request must be accompanied by a fee in an amount
established by commission rule and must correctly and fully
represent the facts relevant to the person and the proposed
transaction. If the commissioner determines that the person would
not be a person in control of the license holder for purposes of
this section, the commissioner shall advise the license holder in
writing that this section does not apply to the proposed person and
transaction.
Sec. 151.606. CONFIDENTIALITY. (a) Except as otherwise
provided by Subsection (b) or by rule of the commission, all
financial information and all other personal information obtained
by the commissioner under this chapter through application,
examination, investigation, or otherwise, and any related file or
record of the department, is confidential and not subject to
disclosure.
(b) The commissioner may disclose confidential information
if:
(1) the applicant, license holder, or authorized
delegate consents to the release of the information or has
published the information contained in the release;
(2) the commissioner finds that release of the
information is necessary to protect the public or purchasers or
potential purchasers of money services from the license holder or
authorized delegate from immediate and irreparable harm;
(3) the information is disclosed to an agency
identified in Section 151.105(a), in which event the information
remains confidential and the agency must take appropriate measures
to maintain that confidentiality;
(4) the commissioner finds that release of the
information is required for an administrative hearing; or
(5) the commissioner discloses the information to a
person acting on behalf of or for the commissioner for regulatory or
enforcement purposes, subject to an agreement that maintains the
confidentiality of the information.
(c) This section does not prohibit the commissioner from
disclosing to the public:
(1) a list of license holders or authorized delegates,
including addresses and the names of contact individuals;
(2) the identity of a license holder or authorized
delegate subject to an emergency or final order of the commissioner
and the basis for the commissioner's action; or
(3) information regarding or included in a consumer
complaint against a license holder or authorized delegate.
[Sections 151.607-151.700 reserved for expansion]
SUBCHAPTER H. ENFORCEMENT
Sec. 151.701. INJUNCTIVE RELIEF. (a) Whenever it appears
that a person has violated, or that reasonable cause exists to
believe that a person is likely to violate, this chapter or a rule
adopted under this chapter, the following persons may bring an
action for injunctive relief to enjoin the violation or enforce
compliance with the provision:
(1) the commissioner, through the attorney general;
(2) the attorney general;
(3) the district attorney of Travis County; or
(4) the prosecuting attorney of the county in which
the violation is alleged to have occurred.
(b) In addition to the authority granted to the commissioner
under Subsection (a), the commissioner, through the attorney
general, may bring an action for injunctive relief if the
commissioner has reason to believe that a person has violated or is
likely to violate an order of the commissioner issued under this
chapter.
(c) An action for injunctive relief brought by the
commissioner, the attorney general, or the district attorney of
Travis County under Subsection (a), or brought by the commissioner
under Subsection (b), must be brought in a district court in Travis
County. An action brought by a prosecuting attorney under
Subsection (a)(4) must be brought in a district court in the county
in which all or part of the violation is alleged to have occurred.
(d) On a proper showing, the court may issue a restraining
order, an order freezing assets, a preliminary or permanent
injunction, or a writ of mandate, or may appoint a receiver for the
defendant or the defendant's assets.
(e) A receiver appointed by the court under Subsection (d)
may, with approval of the court, exercise all of the powers of the
defendant's directors, officers, partners, trustees, or persons
who exercise similar powers and perform similar duties.
(f) An action brought under this section may include a claim
for ancillary relief, including a claim by the commissioner for
costs or civil penalties authorized under this chapter, or for
restitution or damages on behalf of the persons injured by the act
constituting the subject matter of the action, and the court has
jurisdiction to award that relief.
Sec. 151.702. UNLICENSED PERSONS. If the commissioner has
reason to believe that an unlicensed person has engaged or is likely
to engage in an activity for which a license is required under this
chapter, the commissioner may order the person to cease and desist
from the violation until the person is issued a license under this
chapter. The commissioner's order is subject to Section 151.709,
unless the order is issued as an emergency order. The commissioner
may issue an emergency cease and desist order in accordance with
Section 151.710 if the commissioner finds that the person's
violation or likely violation threatens immediate and irreparable
harm to the public.
Sec. 151.703. SUSPENSION AND REVOCATION OF LICENSE. (a)
The commissioner must revoke a license if the commissioner finds
that:
(1) the net worth of the license holder is less than
the amount required under this chapter; or
(2) the license holder does not provide the security
required under this chapter.
(b) The commissioner may suspend or revoke a license or
order a license holder to revoke the designation of an authorized
delegate if the commissioner has reason to believe that:
(1) the license holder has violated this chapter, a
rule adopted or order issued under this chapter, a written
agreement entered into with the department or commissioner, or any
other state or federal law applicable to the license holder's money
services business;
(2) the license holder has refused to permit or has not
cooperated with an examination or investigation authorized by this
chapter;
(3) the license holder has engaged in fraud, knowing
misrepresentation, deceit, or gross negligence in connection with
the operation of the license holder's money services business or
any transaction subject to this chapter;
(4) an authorized delegate of the license holder has
knowingly violated this chapter, a rule adopted or order issued
under this chapter, or a state or federal anti-money laundering or
terrorist funding law, and the license holder knows or should have
known of the violation and has failed to make a reasonable effort to
prevent or correct the violation;
(5) the competence, experience, character, or general
fitness of the license holder or an authorized delegate of the
license holder, or a principal of, person in control of, or
responsible person of a license holder or authorized delegate,
indicates that it is not in the public interest to permit the
license holder or authorized delegate to provide money services;
(6) the license holder has engaged in an unsafe or
unsound act or practice or has conducted business in an unsafe or
unsound manner;
(7) the license holder has suspended payment of the
license holder's obligations, made a general assignment for the
benefit of the license holder's creditors, or admitted in writing
the license holder's inability to pay debts of the license holder as
they become due;
(8) the license holder has failed to terminate the
authority of an authorized delegate after the commissioner has
issued and served on the license holder a final order finding that
the authorized delegate has violated this chapter;
(9) a fact or condition exists that, if it had been
known at the time the license holder applied for the license, would
have been grounds for denying the application;
(10) the license holder has engaged in false,
misleading, or deceptive advertising;
(11) the license holder has failed to pay a judgment
entered in favor of a claimant or creditor in an action arising out
of the license holder's activities under this chapter not later
than the 30th day after the date the judgment becomes final or not
later than the 30th day after the date the stay of execution expires
or is terminated, as applicable;
(12) the license holder has knowingly made a material
misstatement or has suppressed or withheld material information on
an application, request for approval, report, or other document
required to be filed with the department under this chapter; or
(13) the license holder has committed a breach of
trust or of a fiduciary duty.
(c) In determining whether a license holder has engaged in
an unsafe or unsound act or practice or has conducted business in an
unsafe or unsound manner, the commissioner may consider factors
that include:
(1) the size and condition of the license holder's
provision of money services;
(2) the magnitude of the loss or potential loss;
(3) the gravity of the violation of this chapter or
rule adopted or order issued under this chapter;
(4) any action taken against the license holder by
this state, another state, or the federal government; and
(5) the previous conduct of the license holder.
(d) The commissioner's order suspending or revoking a
license or directing a license holder to revoke the designation of
an authorized delegate is subject to Section 151.709, unless the
order is issued as an emergency order. The commissioner may issue
an emergency order suspending a license or directing a license
holder to revoke the designation of an authorized delegate in
accordance with Section 151.710 if the commissioner finds that the
factors identified in Section 151.710(b) exist.
Sec. 151.704. SUSPENSION AND REVOCATION OF AUTHORIZED
DELEGATE DESIGNATION. (a) The commissioner may suspend or revoke
the designation of an authorized delegate if the commissioner has
reason to believe that:
(1) the authorized delegate has violated this chapter,
a rule adopted or order issued under this chapter, a written
agreement entered into with the commissioner or the department, or
any other state or federal law applicable to a money services
business;
(2) the authorized delegate has refused to permit or
has not cooperated with an examination or investigation under this
chapter;
(3) the authorized delegate has engaged in fraud,
knowing misrepresentation, deceit, gross negligence, or an unfair
or deceptive act or practice in connection with the operation of the
delegate's business on behalf of the license holder or any
transaction subject to this chapter;
(4) the competence, experience, character, or general
fitness of the authorized delegate, or a principal of, person in
control of, or responsible person of the authorized delegate,
indicates that it is not in the public interest to permit the
authorized delegate to provide money services;
(5) the authorized delegate has engaged in an unsafe
or unsound act or practice or conducted business in an unsafe and
unsound manner;
(6) the authorized delegate, or a principal or
responsible person of the authorized delegate, is listed on the
specifically designated nationals and blocked persons list
prepared by the United States Department of the Treasury as a
potential threat to commit terrorist acts or to fund terrorist
acts; or
(7) the authorized delegate, or a principal or
responsible person of the authorized delegate, has been convicted
of a state or federal anti-money laundering or terrorist funding
law.
(b) In determining whether an authorized delegate has
engaged in an unsafe or unsound act or practice or conducted
business in an unsafe or unsound manner, the commissioner may
consider factors that include:
(1) the size and condition of the authorized
delegate's provision of money services;
(2) the magnitude of the loss or potential loss;
(3) the gravity of the violation of this chapter or
rule adopted or order issued under this chapter;
(4) any action taken against the authorized delegate
by this state, another state, or the federal government; and
(5) the previous conduct of the authorized delegate.
(c) The commissioner's order suspending or revoking the
designation of an authorized delegate is subject to Section
151.709, unless the order is issued as an emergency order. The
commissioner may issue an emergency order suspending the
designation of an authorized delegate in accordance with Section
151.710 if the commissioner finds that the factors identified in
Section 151.710(b) exist.
Sec. 151.705. CEASE AND DESIST ORDERS. (a) The
commissioner may issue an order to cease and desist if the
commissioner finds that:
(1) an action, violation, or condition listed in
Section 151.703 or 151.704 exists with respect to a license holder
or authorized delegate; and
(2) a cease and desist order is necessary to protect
the interests of the license holder, the purchasers of the license
holder's money services, or the public.
(b) A cease and desist order may require a license holder or
authorized delegate to cease and desist from the action or
violation or to take affirmative action to correct any condition
resulting from or contributing to the action or violation, and the
requirements of the order may apply to a principal or responsible
person of the license holder or authorized delegate.
(c) The cease and desist order is subject to Section
151.709, unless the order is issued as an emergency order. The
commissioner may issue an emergency cease and desist order in
accordance with Section 151.710 if the commissioner finds that the
factors identified in Section 151.710(b) exist.
Sec. 151.706. CONSENT ORDERS. (a) The commissioner may
enter into a consent order at any time with a person to resolve a
matter arising under this chapter or a rule adopted or order issued
under this chapter.
(b) A consent order must be signed by the person to whom the
order is issued or by the person's authorized representative and
must indicate agreement with the terms contained in the order.
However, a consent order may provide that the order does not
constitute an admission by a person that this chapter or a rule
adopted or order issued under this chapter has been violated.
(c) A consent order is a final order and may not be appealed.
Sec. 151.707. ADMINISTRATIVE PENALTY. (a) After notice
and hearing, the commissioner may assess an administrative penalty
against a person that:
(1) has violated this chapter or a rule adopted or
order issued under this chapter and has failed to correct the
violation not later than the 30th day after the date the department
sends written notice of the violation to the person;
(2) if the person is a license holder, has engaged in
conduct specified in Section 151.703;
(3) has engaged in a pattern of violations; or
(4) has demonstrated wilful disregard for the
requirements of this chapter, the rules adopted under this chapter,
or an order issued under this chapter.
(b) A violation corrected after a person receives written
notice from the department of the violation may be considered for
purposes of determining whether a person has engaged in a pattern of
violations under Subsection (a)(3) or demonstrated wilful
disregard under Subsection (a)(4).
(c) The amount of the penalty may not exceed $5,000 for each
violation or, in the case of a continuing violation, $5,000 for each
day that the violation continues. Each transaction in violation of
this chapter and each day that a violation continues is a separate
violation.
(d) In determining the amount of the penalty, the
commissioner shall consider factors that include the seriousness of
the violation, the person's compliance history, and the person's
good faith in attempting to comply with this chapter, provided that
if the person is found to have demonstrated wilful disregard under
Subsection (a)(4), the trier of fact shall recommend that the
commissioner impose the maximum administrative penalty permitted
under Subsection (c).
(e) A hearing to assess an administrative penalty is
considered a contested case hearing and is subject to Section
151.801.
(f) An order imposing an administrative penalty after
notice and hearing becomes effective and is final for purposes of
collection and appeal immediately on issuance.
(g) The commissioner may collect an administrative penalty
assessed under this section:
(1) in the same manner that a money judgment is
enforced in court; or
(2) if the penalty is imposed against a license holder
or a license holder's authorized delegate, from the proceeds of the
license holder's security in accordance with Section 151.308(e).
Sec. 151.708. CRIMINAL PENALTY. (a) A person commits an
offense if the person:
(1) intentionally makes a false statement,
misrepresentation, or certification in a record or application
filed with the department or required to be maintained under this
chapter or a rule adopted or order issued under this chapter, or
intentionally makes a false entry or omits a material entry in the
record or application; or
(2) knowingly engages in an activity for which a
license is required under Subchapter D or F without being licensed
under this chapter.
(b) An offense under this section is a felony of the third
degree.
(c) If the commissioner has reason to believe that a person
has committed an offense under this section or any other state or
federal law, the commissioner may file a criminal referral with the
district attorney of Travis County or an appropriate prosecuting
attorney of the county in which the offense is alleged to have been
committed.
(d) Nothing in this section limits the power of the state to
punish a person for an act that constitutes an offense under this or
any other law.
Sec. 151.709. NOTICE, HEARING, AND OTHER PROCEDURES FOR
NONEMERGENCY ORDERS. (a) This section applies to an order issued
by the commissioner under this subchapter that is not an emergency
order.
(b) An order to which this section applies becomes effective
only after notice and an opportunity for hearing. The order must:
(1) state the grounds on which the order is based;
(2) to the extent applicable, state the action or
violation from which the person subject to the order must cease and
desist or the affirmative action the person must take to correct a
condition resulting from the violation or that is otherwise
appropriate;
(3) be delivered by personal delivery or sent by
certified mail, return receipt requested, to the person against
whom the order is directed at the person's last known address;
(4) state the effective date of the order, which may
not be before the 21st day after the date the order is delivered or
mailed; and
(5) include a notice that a person may file a written
request for a hearing on the order with the commissioner not later
than the 20th day after the date the order is delivered or mailed.
(c) Unless the commissioner receives a written request for
hearing from the person against whom the order is directed not later
than the 20th day after the date the order is delivered or mailed,
the order takes effect as stated in the order and is final against
and nonappealable by that person from that date.
(d) A hearing on the order must be held not later than the
45th day after the date the commissioner receives the written
request for the hearing unless the administrative law judge extends
the period for good cause or the parties agree to a later hearing
date.
(e) An order that has been affirmed or modified after a
hearing becomes effective and is final for purposes of enforcement
and appeal immediately on issuance. The order may be appealed to
the district court of Travis County as provided by Section
151.801(b).
Sec. 151.710. REQUIREMENTS AND NOTICE AND HEARING
PROCEDURES FOR EMERGENCY ORDERS. (a) This section applies to an
emergency order issued by the commissioner under this subchapter.
(b) The commissioner may issue an emergency order, without
prior notice and an opportunity for hearing, if the commissioner
finds that:
(1) the action, violation, or condition that is the
basis for the order:
(A) has caused or is likely to cause the
insolvency of the license holder;
(B) has caused or is likely to cause the
substantial dissipation of the license holder's assets or earnings;
(C) has seriously weakened or is likely to
seriously weaken the condition of the license holder; or
(D) has seriously prejudiced or is likely to
seriously prejudice the interests of the license holder, a
purchaser of the license holder's money services, or the public;
and
(2) immediate action is necessary to protect the
interests of the license holder, a purchaser of the license
holder's money services, or the public.
(c) In connection with and as directed by an emergency
order, the commissioner may seize the records and assets of a
license holder or authorized delegate that relate to the license
holder's money services business.
(d) An emergency order must:
(1) state the grounds on which the order is based;
(2) advise the person against whom the order is
directed that the order takes effect immediately, and, to the
extent applicable, require the person to immediately cease and
desist from the conduct or violation that is the subject of the
order or to take the affirmative action stated in the order as
necessary to correct a condition resulting from the conduct or
violation or as otherwise appropriate;
(3) be delivered by personal delivery or sent by
certified mail, return receipt requested, to the person against
whom the order is directed at the person's last known address; and
(4) include a notice that a person may request a
hearing on the order by filing a written request for hearing with
the commissioner not later than the 15th day after the date the
order is delivered or mailed.
(e) An emergency order takes effect as soon as the person
against whom the order is directed has actual or constructive
knowledge of the issuance of the order.
(f) A license holder or authorized delegate against whom an
emergency order is directed must submit a written certification to
the commissioner, signed by the license holder or authorized
delegate, and their principals and responsible individuals, as
applicable, and each person named in the order, stating that each
person has received a copy of and has read and understands the
order.
(g) Unless the commissioner receives a written request for a
hearing from a person against whom an emergency order is directed
not later than the 15th day after the date the order is delivered or
mailed, the order is final and nonappealable as to that person on
the 16th day after the date the order is delivered or mailed.
(h) A request for a hearing does not stay an emergency
order.
(i) A hearing on an emergency order takes precedence over
any other matter pending before the commissioner, and must be held
not later than the 10th day after the date the commissioner receives
the written request for hearing unless the administrative law judge
extends the period for good cause or the parties agree to a later
hearing date.
(j) An emergency order that has been affirmed or modified
after a hearing is final for purposes of enforcement and appeal.
The order may be appealed to the district court of Travis County as
provided in Section 151.801(b).
[Sections 151.711-151.800 reserved for expansion]
SUBCHAPTER I. ADMINISTRATIVE PROCEDURES AND JUDICIAL REVIEW
Sec. 151.801. ADMINISTRATIVE PROCEDURES. (a) All
administrative proceedings under this chapter must be conducted in
accordance with Chapter 2001, Government Code, and Title 7, Chapter
9, Texas Administrative Code.
(b) A person affected by a final order of the commissioner
issued under this chapter after a hearing may appeal the order by
filing a petition for judicial review in a district court of Travis
County. A petition for judicial review filed in the district court
under this subsection does not stay or vacate the appealed order
unless the court, after notice and hearing, specifically stays or
vacates the order.
SECTION 2. SAVING AND TRANSITIONAL PROVISIONS. (a) A
license issued under Chapter 152, Finance Code, or Chapter 153,
Finance Code, that is in effect on September 1, 2005, remains in
force as a license under Chapter 152, Finance Code, or Chapter 153,
Finance Code, until August 15, 2006. The license expires on August
15, 2006, unless the license holder renews the license in
accordance with this Act. Except as provided by this section, a
license holder that seeks to renew its license must satisfy the net
worth, security, permissible investment, and other substantive
requirements for licensure established in Chapter 151, Finance
Code, as added by this Act.
(b) A person licensed as of September 1, 2005, to engage in
the business of currency transmission or currency transportation
under Chapter 153, Finance Code, has until August 15, 2011, to
satisfy the net worth and permissible investment requirements
established in Chapter 151, Finance Code, as added by this Act. The
Banking Commissioner of Texas may extend the period beyond that
date on a year-by-year basis for good cause shown.
(c) A person licensed as of September 1, 2005, to engage in
the business of currency transmission or currency transportation
under Chapter 153, Finance Code, has until August 15, 2007, to
satisfy the security requirements established in Chapter 151,
Finance Code, as added by this Act.
(d) A contract between a license holder and an authorized
delegate that is in effect on September 1, 2005, remains in effect
until the earlier of the date the contract is renewed or December
31, 2006. A new or renewal contract entered into between a license
holder and an authorized delegate after the effective date of this
Act must satisfy the contract requirements established in Chapter
151, Finance Code, as added by this Act.
(e) The Finance Commission of Texas may adopt rules to
further provide for the orderly transition to licensing and
regulation under this Act.
SECTION 3. REPEALER. Chapters 152 and 153, Finance Code,
are repealed.
SECTION 4. EFFECTIVE DATE. This Act takes effect September
1, 2005.