Section 399-G:1 – Definitions.
Universal Citation: NH Rev Stat § 399-G:1 (2021)
399-G:1 Definitions. –
In this chapter:
I. “Affiliate” means a partnership, corporation, trust, limited liability company, or other organization or person that directly or indirectly owns or controls, or is under common ownership with, or is directly or indirectly owned or controlled by, a licensee.
II. “Applicant” means a person who applies for a principal office license under this chapter.
III. “Authorized delegate” means a person that is located in this state that a licensee designates to provide money transmission services on behalf of the licensee.
IV. “Average daily outstanding money transmissions” means the total dollar volume less fees sent by persons in all jurisdictions where business is conducted through the licensee’s principal office, and its authorized delegates, that has not yet been received in cash by the intended recipients, calculated for a calendar year, divided by 365.
V. “Commissioner” means the bank commissioner.
VI. “Control” means the power, directly or indirectly, to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise. Any person is presumed to control a company if such person:
(a) Is a director, general partner, or executive officer;
(b) Directly or indirectly has the right to vote 10 percent or more of a class of a voting security or membership interest, or has the power to sell or direct the sale of 10 percent or more of a class of voting securities or membership interest;
(c) In the case of a limited liability company, is a managing member; or
(d) In the case of a partnership, has the right to receive upon dissolution, or has contributed, 10 percent or more of the capital.
VII. “Convertible virtual currency” means a digital representation of value that:
(a) Can be a medium of exchange, a unit of account, and/or a store of value;
(b) Has an equivalent value in real currency or acts as a substitute for real currency;
(c) May be centralized or decentralized; and
(d) Can be exchanged for currency or other convertible virtual currency.
VIII. “Currency” means the coin and paper money of the United States or of any other country that is designated as legal tender and that circulates and is customarily used and accepted as a medium of exchange in the country of issuance.
IX. “Department” means the banking department.
X. “Direct owner” means any person, including an individual, that owns, beneficially owns, has the right to vote, or has the power to sell or direct the sale of 10 percent or more of the applicant or licensee.
XI. “Financial services” or “financial services-related” means securities, commodities, banking, insurance, consumer lending, money transmission, debt adjustment, or real estate, including, but not limited to, acting as or being associated with a bank or savings association, credit union, mortgage lender, mortgage broker, mortgage servicer, real estate salesperson or agent, closing agent, title company, or escrow agent.
XII. “Indirect owner” means, with respect to direct owners and other indirect owners in a multilayered organization:
(a) In the case of an owner that is a corporation, each of its shareholders that beneficially owns, has the right to vote, or has the power to sell or direct the sale of, 25 percent or more of that corporation;
(b) In the case of an owner that is a partnership, all general partners and those limited and special partners that have the right to receive upon dissolution, or have contributed, 25 percent or more of the partnership’s capital;
(c) In the case of an owner that is a trust, the trust, each trustee, and each beneficiary of 25 percent or more of the trust;
(d) In the case of an owner that is a limited liability company (“LLC”):
(1) Those members that have the right to receive upon dissolution, or have contributed, 25 percent or more of the LLC’s capital; and
(2) If managed by elected managers, all elected managers; and
(e) In the case of an indirect owner, the parent owners of 25 percent or more of their subsidiary.
XIII. “Individual” means a natural person.
XIV. “Licensee” means a person duly licensed by the commissioner under this chapter.
XV. “Monetary value” means a medium of exchange, whether or not redeemable in currency, and includes convertible virtual currency.
XVI. “Money transmission” means:
(a) Engaging in the business of selling or issuing payment instruments or stored value; or
(b) Receiving currency or monetary value for transmission to another location.
XVII. “Money transmitter” means a person engaged in the business of money transmission.
XVII-a. “Nationwide Multistate Licensing System and Registry” means a national licensing system and facility developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, or their successors, for the licensing and registration of mortgage loan originators, mortgage lenders, mortgage servicers, mortgage brokers, and other non-depository financial service licensees, including money transmitters.
XVIII. “Net worth” means assets minus liabilities calculated in accordance with generally accepted accounting principles.
XIX. “Payment instrument” means any electronic or written check, draft, money order, traveler’s check, or other electronic or written instrument or order for the transmission or payment of currency or monetary value, sold or issued to one or more persons, whether or not negotiable. The term does not include a credit card voucher, letter of credit, or instrument that is redeemable by the issuer in goods or services.
XX. “Person” means an individual, corporation, business trust, estate, trust, partnership, association, 2 or more persons having a joint or common interest, or any other legal or commercial entity however organized.
XXI. “Principal” of the applicant or licensee means an owner with 10 percent or more ownership interest in the applicant or licensee, a corporate officer, director, member, general and limited liability partner, limited partner with 10 percent or more ownership interest, trustee, beneficiary of 10 percent or more of the trust that owns the applicant or licensee, indirect owner, senior manager, and any person occupying similar status or performing similar functions.
XXII. “Principal office” means the main office location of a person required to be licensed under this chapter.
XXIII. “Publicly traded” means a company whose securities are traded on a securities exchange system approved and supervised by the Securities and Exchange Commission, including but not limited to the NYSE, AMEX, BSE, and NASDAQ. The term also includes a public reporting company that is subject to sections 12 or 15(d) of the Securities Exchange Act of 1934.
XXIV. “Registrant” means a person registered as an authorized delegate by the commissioner under this chapter.
XXIV-a. “Significant event” means:
(a) Filing for bankruptcy or reorganization;
(b) Criminal felony indictment or conviction of any of the licensee’s principals;
(c) Receiving notification of a license denial, cease and desist, consent agreement or order, suspension, or revocation, or any other formal administrative action in any state against the licensee;
(d) Receiving notification of any enforcement action or investigation by the attorney general of the state of New Hampshire or of any other state pursuant to any consumer protection statute, and the reasons thereof, except routine investigations of consumer complaints; or
(e) Entering into a consent agreement, settlement agreement, memorandum of understanding, or similar agreement with any regulatory body pertaining to the licensee’s practices.
XXV. “Senior manager” means any officer of record, assistant vice president or higher, office or branch manager, director of operations, or other position the responsibilities of which provide such employee with the discretion or ability to set policy or manage or direct affairs of the licensee as a whole, or of any division or department or unit of the licensee.
XXVI. “Stored value” means monetary value that is evidenced by an electronic record.
Section 399-G:2 – License Required.
Universal Citation: NH Rev Stat § 399-G:2 (2021)
399-G:2 License Required. –
I. Any person not exempt under RSA 399-G:3 that, in its own name or on behalf of other persons, acts as a money transmitter while physically located in New Hampshire, or with, to, or from persons located in New Hampshire, shall obtain a license from the department and shall register its authorized delegates located within this state.
II. Licensure or registration in the state of New Hampshire under this chapter does not constitute a finding that the commissioner has passed in any way upon the merits or qualifications of such person or that the commissioner has recommended or given approval to any such person. It is unlawful for any licensee or registrant to make, or cause to be made, to any prospective purchaser, customer, or client any representation inconsistent with the provisions of this paragraph.
III. Any license fee required by this chapter shall be paid before a license becomes effective. Authorized delegate registrations shall be effective upon the commissioner’s receipt of written notice conditioned upon payment of the registration fee within 30 calendar days, as required by RSA 399-G:4.
Section 399-G:3 – Exemptions.
Universal Citation: NH Rev Stat § 399-G:3 (2021)
399-G:3 Exemptions. –
The provisions of this chapter shall not apply to:
I. Any bank, trust company, savings and loan association, profit sharing and pension trust, credit union, thrift company, insurance company, or receivership, which may be chartered by this state or any other state or by any agency of the United States.
II. The United States or any department, instrumentality, or agency thereof.
III. A state, county, city, or any other governmental agency or governmental subdivision of a state.
IV. Electronic funds transfer of governmental benefits for a federal, state, county, or governmental agency by a contractor on behalf of the United States or a department, agency, or instrumentality thereof, or a state or governmental subdivision, agency, or instrumentality thereof.
V. Retailers issuing stored value credits or gift cards.
VI. A debt adjuster duly licensed pursuant to RSA 399-D that acts as a money transmitter for the sole purpose of providing a debt adjustment service to a consumer under terms of a contract issued pursuant to RSA 399-D and that has a surety bond on file with the commissioner under RSA 399-D in the amount of $100,000.
VI-a. Persons who engage in the business of selling or issuing payment instruments or stored value solely in the form of convertible virtual currency or receive convertible virtual currency for transmission to another location. Such persons shall be subject to the provisions of RSA 358-A.
VII. Other persons not within the intent of this chapter as the commissioner may designate by rule or order.
Section 399-G:4 – Application and Fees.
Universal Citation: NH Rev Stat § 399-G:4 (2021)
399-G:4 Application and Fees. –
I. (a) To be considered for licensing, each person shall complete and file with the department one verified application through the Nationwide Multistate Licensing System and Registry, using the Nationwide Multistate Licensing System and Registry form which shall include but not be limited to the following information:
(1) The primary business address of the applicant;
(2) The applicant’s tax identification number;
(3) The address of its principal office and all authorized delegates located or to be located within the state;
(4) A copy of its FinCEN Form 107 Registration of Money Services Business filing;
(5) The trade name, if any, under which the applicant proposes to conduct such business and evidence of authority to use the trade name in New Hampshire;
(6) The articles of incorporation or organization or partnership agreement;
(7) The name and address of the New Hampshire resident agent if the applicant is a foreign entity;
(8) A financial statement as described in paragraph II(c);
(9) A consent to service of process as described in subparagraph V;
(10) A list of the principals of the applicant and each principal shall provide his or her social security number and shall authorize the commissioner to conduct a background check; and
(11) Any other information that the commissioner may require including, but not limited to, the applicant’s form and place of organization, the applicant’s proposed method of doing business, the qualifications and business history of the applicant and its principals, and the applicant’s financial condition and history.
(b) The applicant shall disclose whether the applicant or any of its principals has ever been issued or been the subject of an injunction or administrative order, has ever been convicted of a misdemeanor involving the financial services industry or any aspect of the financial services business, or has ever been convicted of any felony.
II. (a) The license issued for the licensee’s principal place of business shall be referred to as a “principal office license.” Each additional authorization to conduct business issued for money transmission occurring in a location in this state that is separate from the licensee’s principal place of business shall be referred to as an “authorized delegate registration.” If the applicant desires to transmit money in more than one location, the commissioner, upon favorable action on the applicant’s principal office license, shall issue an “authorized delegate registration” for each location where the business of money transmission is to be conducted.
(b) Each license application shall be accompanied by a nonrefundable application fee of $500 for the principal office. Within 30 days from the start of money transmission activity for the licensee at each authorized delegate location, a fee of $25 shall be paid to and received by the department for each authorized delegate registration. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the commissioner, consumer credit administration division.
(c) Each applicant shall submit detailed financial information sufficient for the commissioner to determine the applicant’s ability to conduct the business of a money transmitter with financial integrity.
(d) The application shall include a statement of net worth in all cases and an applicant shall demonstrate and maintain a positive net worth computed in accordance with generally accepted accounting principles. Net worth statements provided in connection with a license application under this section shall be subject to review and verification during the course of any examination or investigation conducted under the authority of RSA 399-G:13.
(e) The application shall include a financial statement that shall be prepared in accordance with generally accepted accounting principles with appropriate note disclosures and, unless excepted by an order from the commissioner for hardship reasons, shall be audited by an independent certified public accountant. An applicant’s financial statement shall include a balance sheet, income statement, statement of changes in owners’ equity, cash flow statement, and statement of net worth.
III. (a) Unless the applicant is a publicly traded corporation, the department shall complete a background investigation and criminal history records check on the applicant’s principals. If the applicant is a subsidiary, the department shall complete a background investigation and criminal history records check on individuals who are indirect owners.
(b) The persons described in subparagraph (a) shall submit to the department a criminal history records release form, as provided by the New Hampshire division of state police, which authorizes the release of the person’s criminal records, if any. The person shall submit with the release form a complete set of fingerprints taken by a qualified law enforcement agency or an authorized employee of the department. In the event that the first set of fingerprints is invalid due to insufficient pattern, a second set of fingerprints is necessary in order to complete the criminal history records check. If, after 2 attempts, a set of fingerprints is invalid due to insufficient pattern, the department may, in lieu of the criminal history records check, accept police clearances from every city, town, or county where the person has lived during the past 5 years.
(c) The department shall submit the criminal history records release form to the New Hampshire division of state police, which shall conduct a criminal history records check through its records and through the Federal Bureau of Investigation. Upon completion of the background investigation, the division of state police shall release copies of the criminal conviction records to the department. The department shall maintain the confidentiality of all criminal history records information received pursuant to this paragraph.
(d) The department may require the applicant or licensee to pay the actual costs of each background investigation and criminal history records check.
(e) The department may conduct a pre-licensing examination of the applicant.
(f) The department may rely on criminal records checks reported through a national licensing facility in lieu of subparagraphs (b) and (c).
IV. (a) Each money transmitter applicant shall post a continuous surety bond in the amount of $100,000. The surety bond shall be payable to the state of New Hampshire and the bank commissioner of the state of New Hampshire for the benefit of any person who is damaged by any violation of this chapter and shall be conditioned upon the licensee’s compliance with each provision of this chapter.
(b) Surety bonds shall include a provision requiring the surety to give written notice to the commissioner 30 days in advance of the cancellation or termination of the bond.
(c) Every bond shall provide that no recovery may be made against the bond unless the state makes a claim for recovery or the person brings suit naming the principal within 6 years after the act upon which the recovery or suit is based. The obligations of the surety shall survive the bankruptcy, insolvency, liquidation, or reorganization of the licensee, including, without limitation, any bankruptcy, insolvency, liquidation, or reorganization commenced by or against the licensee under any applicable state or federal law, including the United States Bankruptcy Code.
(d) When an action is commenced on a licensee’s bond, the licensee shall immediately file a new bond. Immediately upon recovery upon any action on the bond, the licensee shall file a new bond.
V. Every applicant for licensing under this chapter shall file with the commissioner irrevocable consent appointing the commissioner to receive service of any lawful process in any noncriminal suit, action, or proceeding against the applicant or the applicant’s successor, executor, or administrator which arises under this chapter or any rule or order under this chapter after the consent has been filed, with the same force and validity as if served personally on the person filing the consent. A person who has filed such a consent in connection with a previous application need not file another. When any person, including a nonresident of this state, engages in conduct prohibited or made actionable by this chapter or by any rule or order under this chapter, and such person has not filed a consent to service of process under this section and personal jurisdiction over such person cannot otherwise be obtained in this state, that conduct shall be considered equivalent to such person’s appointment of the commissioner to receive service of any lawful process. Service may be made by leaving a copy of the process in the office of the commissioner along with $5, but is not effective unless:
(a) The plaintiff, who may be the attorney general in a suit, action, or proceeding instituted by him or her, forthwith sends a notice of the service and a copy of the process by registered mail to the defendant or respondent at such person’s last address on file with the commissioner; and
(b) The plaintiff’s affidavit of compliance with this paragraph is filed in the case on or before the return day of the process, if any, or within such further time as the court allows.
VI. Applicants shall provide written plans for compliance with federal laws, including but not limited to the Bank Secrecy Act of 1970, as amended, and regulations in 31 C.F.R. part 1010. Such plans shall include required recordkeeping and reporting procedures.
VII. The commissioner may license or register individuals or firms by means of or through the facilities of a national organization which facilitates registration and licensing on a nationwide basis.
Section 399-G:5 – License and Registration Grant and Renewal.
Universal Citation: NH Rev Stat § 399-G:5 (2021)
399-G:5 License and Registration Grant and Renewal. –
I. Upon the applicant’s filing of the complete application, and payment of the required fee, the commissioner shall have, in accordance with RSA 541-A:29, up to 120 days to investigate and determine whether the applicant’s financial resources, experience, personnel, and record of past or proposed conduct warrant the public’s confidence and the issuance of a license.
II. If the commissioner determines that the applicant meets the requirements of this chapter, then the commissioner shall issue a license and or registrations permitting the applicant to engage in the business of money transmission in accordance with the laws of this state.
III. Each license issued under the provisions of this chapter shall state the name and address of the principal office of the licensee. Each registration issued under the provisions of this chapter shall state the name and address of the authorized delegate location for which that registration is issued.
IV. If a licensee is a person other than a natural person, the license issued to it shall entitle all officers, directors, members, partners, trustees, and employees, and authorized delegates of the licensee to engage in the business of money transmission; provided that one officer, director, member, partner, employee, or trustee of such person shall be designated in the license as the individual to be contacted for purposes of this chapter.
V. If the licensee is a natural person, the license shall entitle all employees and authorized delegates of the licensee to engage in the business of money transmission.
VI. A principal office license or authorized delegate registration issued under this chapter shall not be transferable or assignable between persons without obtaining the approval of the commissioner before the assignment or transfer.
VII. Each license or registration shall remain in force until it has been surrendered, revoked, or suspended in accordance with the provisions of this chapter, or expires in accordance with the provisions of this chapter. Each license or registration shall expire on December 31 of each calendar year.
VIII. If a person holds a valid license or registration under this section and is in compliance with this chapter and the rules pursuant to this chapter, such licensee may renew the principal office license and authorized delegate registrations by paying the required fee to the banking department on or before December 31 for the ensuing year that begins on January 1. Failure to renew the license or registration shall result in the license or registration terminating on December 31.
IX. A renewal fee shall be submitted with the application for renewal as follows:
(a) $500 for the principal office license, and
(b) $25 for each authorized delegate registration.
Section 399-G:6 – License Denial or Abandonment; Appeal.
Universal Citation: NH Rev Stat § 399-G:6 (2021)
399-G:6 License Denial or Abandonment; Appeal. –
I. If the commissioner determines that the applicant fails to meet the requirements of this chapter, the commissioner shall immediately, in writing, notify the applicant of that determination.
II. The commissioner may deny a license application if it is in the public interest and the applicant or the applicant’s principal:
(a) Has filed an application for licensing which was incomplete in any material respect;
(b) Is the subject of an order entered within the past 5 years by this state, any other state, or federal regulator denying, suspending, or revoking a license or registration;
(c) Is permanently, preliminarily, or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of lending or collection activities;
(d) Is not qualified on the basis of such factors as experience, knowledge, and financial integrity; or
(e) Should not be licensed for other good cause shown.
III. Applicants may appeal a license denial in accordance with RSA 541-A and rules of the commissioner adopted thereunder.
IV. Applicants may petition the banking department for a rehearing in accordance with RSA 541 if the decision in an appeal conducted pursuant to paragraph III affirms a denial of a license application.
V. The commissioner may deem abandoned and withdraw any application for licensure made pursuant to this chapter if the applicant fails to respond in writing within 180 calendar days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.
VI. No application for renewal shall be denied without reasonable cause and the right of appeal pursuant to RSA 541-A and RSA 541.
Section 399-G:7 – License Posting.
Universal Citation: NH Rev Stat § 399-G:7 (2021)
399-G:7 License Posting. – It shall be unlawful to engage in the business of money transmission without a conspicuously posted license in the licensee’s principal office within this state or a conspicuously posted registration in each of the licensee’s authorized delegate offices within this state.
Section 399-G:8 – License Surrender.
Universal Citation: NH Rev Stat § 399-G:8 (2021)
399-G:8 License Surrender. –
I. A licensee who ceases to engage in the business of money transmission at any time during a license year for any cause shall surrender such principal license and authorized delegate registrations, if any, and within 15 calendar days of such cessation shall cause to be published in a newspaper of general circulation in the licensee’s market area a notice to such effect, and shall file any required report pursuant to RSA 399-G:10. The commissioner may adopt rules, in accordance with RSA 541-A, relative to such notice and the process for surrender.
II. Surrender of a license shall not take effect until the commissioner deems the surrender process complete.
III. Failure to comply with the provisions of this section and rules adopted under this section shall be cause for denial of future license applications and the imposition of penalties under RSA 399-G:23.