2012 Arkansas Code
Title 23 – Public Utilities and Regulated Industries
Subtitle 2 – Financial Institutions And Securities
Chapter 55 – Uniform Money Services Act.
Article 2 – Money Transmission Licenses
§ 23-55-201 – License required.
(a) A person may not engage in the business of money transmission or advertise, solicit, or hold itself out as providing money transmission unless the person:
(1) is licensed under this article;
(2) is an authorized delegate of a person licensed under this article; or
(3) is excluded under § 23-55-103.
(b) A license under this article is not transferable or assignable.
- 23-55-202 – Application for license.
(a) In this section, “material litigation” means litigation that according to generally accepted accounting principles is significant to an applicant’s or a licensee’s financial health and would be required to be disclosed in the applicant’s or licensee’s annual audited financial statements, report to shareholders, or similar records.
(b) A person applying for a license under this article shall do so in a form and in a medium prescribed by the commissioner. The application must state or contain:
(1) the legal name and residential and business addresses of the applicant and any fictitious or trade name used by the applicant in conducting its business;
(2) a list of any criminal convictions of the applicant and any material litigation in which the applicant has been involved in the 10-year period next preceding the submission of the application;
(3) a description of any money services previously provided by the applicant and the money services that the applicant seeks to provide in this State;
(4) a list of the applicant’s proposed authorized delegates and the locations in this State where the applicant and its authorized delegates propose to engage in money transmission or provide other money services;
(5) a list of other States in which the applicant is licensed to engage in money transmission or provide other money services and any license revocations, suspensions, or other disciplinary action taken against the applicant in another State;
(6) information concerning any bankruptcy or receivership proceedings affecting the licensee;
(7) a sample form of contract for authorized delegates, if applicable, and a sample form of payment instrument or instrument upon which stored value is recorded, if applicable;
(8) the name and address of any bank through which the applicant’s payment instruments and stored value will be paid;
(9) a description of the source of money and credit to be used by the applicant to provide money services; and
(10) any other information the commissioner reasonably requires with respect to the applicant.
(c) If an applicant is a corporation, limited liability company, partnership, or other entity, the applicant shall also provide:
(1) the date of the applicant’s incorporation or formation and State or country of incorporation or formation;
(2) if applicable, a certificate of good standing from the State or country in which the applicant is incorporated or formed;
(3) a brief description of the structure or organization of the applicant, including any parent or subsidiary of the applicant, and whether any parent or subsidiary is publicly traded;
(4) the legal name, any fictitious or trade name, all business and residential addresses, and the employment, in the 10-year period next preceding the submission of the application of each executive officer, manager, director, or person that has control, of the applicant;
(5) a list of any criminal convictions and material litigation in which any executive officer, manager, director, or person in control of, the applicant has been involved in the 10-year period next preceding the submission of the application;
(6) a copy of the applicant’s audited financial statements for the most recent fiscal year and, if available, for the two-year period next preceding the submission of the application;
(7) a copy of the applicant’s unconsolidated financial statements for the current fiscal year, whether audited or not, and, if available, for the two-year period next preceding the submission of the application;
(8) if the applicant is publicly traded, a copy of the most recent report filed with the United States Securities and Exchange Commission under § 13 of the federal Securities Exchange Act of 1934, 15 U.S.C. § 78m (1994 & Supp. V 1999);
(9) evidence of the applicant’s registration or qualification to do business in this state;
(10) if the applicant is a wholly owned subsidiary of:
(A) a corporation publicly traded in the United States, a copy of audited financial statements for the parent corporation for the most recent fiscal year or a copy of the parent corporation’s most recent report filed under § 13 of the federal Securities Exchange Act of 1934, 15 U.S.C. § 78m (1994 & Supp. V 1999); or
(B) a corporation publicly traded outside the United States, a copy of similar documentation filed with the regulator of the parent corporation’s domicile outside the United States;
(11) if the applicant has a registered agent in this State, the name and address of the applicant’s registered agent in this State; and
(12) any other information the commissioner reasonably requires with respect to the applicant.
(d) A nonrefundable application fee of $1,500 and a license fee of $750 must accompany an application for a license under this article. The license fee must be refunded if the application is denied.
(e) The commissioner may waive one or more requirements of subsections (b) and (c) or permit an applicant to submit other information in lieu of the required information.
(f) The application shall be accompanied by the surety bond required by § 23-55-204.
- 23-55-204 – Security.
(a) Except as otherwise provided in subsection (b), a surety bond in the amount of $50,000 plus $10,000 per location in this State where the applicant and its authorized delegates engage in money transmission or provide other money services, with the maximum required amount of the surety bond of $300,000, must accompany an application for a license to engage in money services.
(b) The surety bond must be in a form satisfactory to the Securities Commissioner and payable to the State for the benefit of any claimant against the licensee to secure the faithful performance of the obligations of the licensee with respect to money transmission.
(c) The aggregate liability on a surety bond may not exceed the principal sum of the bond. A claimant against a licensee may maintain an action on the bond, or the commissioner may maintain an action on behalf of the claimant.
(d) A surety bond must cover claims for so long as the commissioner specifies, but for at least five years after the licensee ceases to provide money services in this State. However, the commissioner may permit the amount of security to be reduced or eliminated before the expiration of that time to the extent the amount of the licensee’s payment instruments or stored-value obligations outstanding in this State is reduced.
(e) [Repealed.]
(f) The commissioner may increase the amount of security required to a maximum of $1,000,000 if the financial condition of a licensee so requires, as evidenced by reduction of net worth, financial losses, or other relevant criteria.
- 23-55-205 – Issuance of license.
(a) When an application is filed under this article, the commissioner shall investigate the applicant’s financial condition and responsibility, financial and business experience, character, and general fitness. The commissioner may conduct an on-site investigation of the applicant, the reasonable cost of which the applicant must pay. The commissioner shall issue a license to an applicant under this subchapter if the commissioner finds that all of the following conditions have been fulfilled:
(1) the applicant has complied with §§ 23-55-202, 23-55-204, and 23-55-207; and
(2) the financial condition and responsibility, financial and business experience, competence, character, and general fitness of the applicant; and the competence, experience, character, and general fitness of the executive officers, managers, directors, and persons in control of, the applicant indicate that it is in the interest of the public to permit the applicant to engage in money transmission.
(b) When an application for an original license under this article is complete, the commissioner shall promptly notify the applicant in a record of the date on which the application was determined to be complete and:
(1) the commissioner shall approve or deny the application within 120 days after that date; or
(2) if the application is not approved or denied within 120 days after that date:
(A) the application is deemed approved; and
(B) the commissioner shall issue the license under this article, to take effect as of the first business day after expiration of the 120-day period.
(c) The commissioner may for good cause extend the application period.
(d) An applicant whose application is denied by the commissioner under this article may appeal, within 30 days after receipt of the notice of the denial, from the denial and request a hearing before the commissioner.
(e) A license issued under this article expires annually at the close of business on December 31 unless the license is:
(1) renewed according to this article;
(2) surrendered by the license holder;
(3) suspended; or
(4) revoked by the commissioner.
- 23-55-206 – Renewal of license.
(a) A licensee under this article shall pay an annual renewal fee of $750 no later than December 1 for the succeeding calendar year or, if December 1 is not a business day, on the next business day.
(b) A licensee under this article shall submit a renewal report with the renewal fee, in a form prescribed by the commissioner. The renewal report must state or contain:
(1) the number and monetary amount of payment instruments and stored-value sold by the licensee in this State which have not been included in a renewal report and the monetary amount of payment instruments and stored value currently outstanding;
(2) a description of each material change in information submitted by the licensee in its original license application which has not been reported to the commissioner on any required report;
(3) a list of the licensee’s permissible investments and a certification that the licensee continues to maintain permissible investments according to the requirements set forth in §§ 23-55-701 and 23-55-702; and
(4) proof that the licensee continues to maintain adequate security as required by § 23-55-204.
(c) A licensee that does not comply with subsections (a) and (b) by December 1 shall pay a late fee of $250 if the complete renewal application is received before the expiration of the license.
(d) The commissioner for good cause may grant an extension of the renewal date.
- 23-55-207 – Net worth.
A licensee under this article shall maintain a net worth of at least $250,000 determined in accordance with generally accepted accounting principles.