(k) Before filing an application for approval to acquire control of a licensee, a person may request in writing a determination from the division as to whether the person would be considered a person in control of a licensee upon consummation of a proposed transaction. If the division determines that the person would not be a person in control of a licensee, the person is not subject to the requirements of pars. (a) and (b).
(2) Change of key individuals. (a) Upon adding or replacing any key individual, a licensee shall do all of the following:
1. No later than 15 days after the effective date of the key individual’s appointment, provide notice of the change in a manner acceptable to the division.
2. No later than 45 days after the effective date of the individual’s appointment, provide the information required by s. 217.05 (4).
(b) The division may issue a notice of disapproval of a key individual if it finds that the competence, experience, character, or integrity of the individual indicates that it is not in the interest of the public or the customers of the licensee to permit the individual to be a key individual of the licensee. The notice of disapproval shall contain a statement of the basis for disapproval. An applicant whose application is denied by the division under this subsection may request a hearing under s. 227.44 within 30 days after the date of denial. The division may appoint a hearing examiner under s. 227.46 to conduct the hearing.
(c) If the notice of the change is not disapproved within 90 days after the date on which the requirements of par. (a) were determined to be complete, the key individual is deemed approved.
217.07 Reporting and records. (1) Report of condition. Each licensee shall submit a report of condition no later than 45 days after the end of each calendar quarter, unless a longer period is authorized by the division. The report of condition shall include all of the following:
(a) Financial information at the licensee level.
(b) Nationwide and state-specific money transmission transaction information in every jurisdiction in the United States in which the licensee is licensed to engage in money transmission.
(c) A permissible investments report.
(d) Transaction destination country reporting for money received for transmission, if applicable. This requirement applies only to a report of condition submitted within 45 days of the end of the 4th calendar quarter.
(e) Any other information the division reasonably requires with respect to the licensee.
(2) Audited financials. (a) Each licensee shall submit audited financial information no later than 90 days after the end of each fiscal year, unless a longer period is authorized by the division. The submission shall include an audited financial statement of the licensee for the fiscal year prepared in accordance with U.S. generally accepted accounting principles, together with any other information the division may reasonably require with respect to the licensee.
(b) The audited financial statement shall be prepared by an independent certified public accountant or independent public accountant satisfactory to the division and shall be accompanied by a certificate of opinion that is satisfactory to the division. If the certificate of opinion is qualified, the division may order the licensee to take any action the division finds necessary to enable the independent certified public accountant or independent public accountant to remove the qualification.
(3) Report of authorized delegates. Each licensee shall submit a report of authorized delegates no later than 45 days after the end of each calendar quarter, unless a longer period is authorized by the division. The report of authorized delegates shall include all of the following, if applicable:
(a) Contact information for each authorized delegate of the licensee, including each authorized delegate’s legal name, any fictitious or trade name, employer identification number, principal provider identifier, physical address, mailing address, primary contact person, telephone number, email address, start date as the licensee’s authorized delegate, and end date, if any.
(b) Information concerning each authorized delegate’s business in other states, including whether any court or regulatory authority has prohibited the authorized delegate from acting as an authorized delegate in any jurisdiction.
(c) Any other information the division reasonably requires with respect to the licensee’s authorized delegates.
(4) Reports of certain events. (a) A licensee shall file a report with the division within one business day after the licensee has reason to know of the occurrence of any of the following events:
1. The filing of a petition by or against the licensee under the U.S. Bankruptcy Code, 11 USC 101 to 110, for bankruptcy or reorganization.
2. The filing of a petition by or against the licensee 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 its creditors.
3. The commencement of a proceeding to revoke or suspend its license in a state or country in which the licensee engages in business or is licensed.
(b) A licensee shall file a report with the division within 3 business days after the licensee has reason to know that the licensee or a key individual, person in control, or authorized delegate of the licensee has been charged with or convicted of a felony.
(5) Bank Secrecy Act reports. A licensee and an authorized delegate shall comply with all federal currency reporting, record keeping, and suspicious activity reporting requirements as set forth in the Bank Secrecy Act and other federal and state laws pertaining to money laundering.
(6) Records. (a) A licensee shall maintain all of the following records for at least 3 years:
1. A record of each outstanding money transmission obligation sold.
2. A general ledger posted at least monthly containing all asset, liability, capital, income, and expense accounts.
3. Bank statements and bank reconciliation records.
4. Records of outstanding money transmission obligations.
5. Records of each money transmission obligation paid within the 3-year period.
6. A list of the last-known names and addresses of all the licensee’s authorized delegates.
7. Any other records the division requires to be maintained by order or rule.
(b) Upon written request of the division to inspect any record specified in par. (a), the licensee shall promptly make the record available to the division. A licensee shall maintain the records specified in par. (a) in a location and manner that ensures the licensee can make the records available to the division no later than 7 business days after the division’s written request.
217.08 Authorized delegates. (1) Before a licensee is authorized to conduct business through an authorized delegate or allows a person to act as the licensee’s authorized delegate, the licensee shall do all of the following:
(a) Adopt, and update as necessary, written policies and procedures reasonably designed to ensure that the licensee’s authorized delegates comply with applicable state and federal law.
(b) Conduct a reasonable risk-based background investigation sufficient for the licensee to determine whether the authorized delegate has complied and will likely comply with applicable state and federal law.
(c) Enter into a signed written agreement that does all of the following:
1. Appoints the authorized delegate for the licensee with the authority to conduct money transmission on behalf of the licensee.
2. Sets forth the nature and scope of the relationship between the licensee and the authorized delegate and the respective rights and responsibilities of the parties.
3. Requires the authorized delegate to fully comply with all applicable state and federal laws, rules, and regulations pertaining to money transmission, including relevant provisions of the Bank Secrecy Act and federal and state laws pertaining to money laundering.
4. Requires the authorized delegate to remit and handle money and monetary value in accordance with the terms of the agreement.
5. Imposes a trust for the benefit of the licensee on money and monetary value net of fees received for money transmission.
6. Requires the authorized delegate to prepare and maintain records as required by this chapter and applicable rules.
7. States the authorized delegate’s consent to examination or investigation by the division.
8. States that the licensee is subject to regulation by the division, and that, as part of that regulation, the division may suspend or revoke an authorized delegate designation or require the licensee to terminate an authorized delegate designation.
9. Acknowledges the authorized delegate’s receipt of the written policies and procedures required under par. (a).
(2) An authorized delegate of a licensee holds in trust for the benefit of the licensee all money net of fees received from money transmission. If any authorized delegate commingles any funds received from money transmission with any other funds or property owned or controlled by the authorized delegate, all commingled funds and other property shall be considered held in trust in favor of the licensee in an amount equal to the amount of money net of fees received from money transmission.
(3) An authorized delegate may not use a subdelegate to conduct money transmission on behalf of a licensee.
(4) A person shall not engage in the business of money transmission on behalf of a person not licensed under this chapter or not exempt pursuant to s. 217.03. A person violating this subsection shall be jointly and severally liable with the unlicensed and nonexempt person for engaging in the business of money transmission without a license.
(5) If a licensee’s license is suspended, revoked, surrendered, or expired, the licensee shall, within 5 business days, provide documentation to the division that the licensee has notified all applicable authorized delegates of the licensee of the suspension, revocation, surrender, or expiration of the license. Upon receiving notice of the suspension, revocation, surrender, or expiration of a license, an authorized delegate shall immediately cease to provide money transmission as an authorized delegate of the applicable licensee.
(6) The division may, by written order, suspend or revoke the designation of an authorized delegate if the division finds any of the following:
(a) The authorized delegate failed to comply with an order of the division, any provision of this chapter, any rule promulgated under this chapter, or any other state or federal law applicable to money transmission.
(b) The authorized delegate failed to cooperate with an investigation, examination, or other request for information by the division.
(c) The authorized delegate engaged in unsafe or unsound practices in connection with the business of money transmission.
(d) The authorized delegate made a material misstatement, or knowingly omitted a material fact, in an application for a license or in information furnished to the division or the nationwide multistate licensing system and registry.
(e) The authorized delegate engaged in any fraudulent or deceptive conduct or gross negligence relating to the business of money transmission.
(f) A federal or state administrative order has been entered against the authorized delegate for violation of any rule or regulation applicable to the conduct of the person’s money transmission business.
(g) The financial responsibility, character, reputation, experience, and general fitness of the authorized delegate indicate that it is not in the public interest to permit the applicant or licensee to provide money transmission in this state.
217.09 Timely transmission; refunds; receipts and other disclosures. (1) Timely transmission. A licensee shall forward all money received for transmission in accordance with the terms of the agreement between the licensee and the sender, unless the licensee has a reasonable belief, or a reasonable basis to believe, that the sender is a victim of fraud or that the transaction relates to a crime or violation of law, rule, or regulation. If a licensee fails to forward money received for transmission in accordance with this subsection, the licensee shall state the reason for the failure in response to any inquiries by the sender unless providing the response would violate applicable state or federal law.
(2) Refunds. (a) Except as provided in par. (b), a licensee shall refund to the sender any money received for transmission within 10 days of receipt of the sender’s written request for a refund.
(b) Paragraph (a) does not apply if any of the following circumstances exist:
1. The money was forwarded within 10 days of the date on which the money was received for transmission.
2. Instructions were given committing an equivalent amount of money to the person designated by the sender within 10 days of the date on which the money was received for transmission.
3. The agreement between the licensee and the sender instructs the licensee to forward the money at a time that is beyond 10 days of the date on which the money was received for transmission. If funds have not yet been forwarded in accordance with the terms of the agreement between the licensee and the sender, the licensee shall issue a refund in accordance with the other provisions of this section.
4. The refund request concerns a transaction that the licensee has not completed because the licensee has a reasonable belief, or a reasonable basis to believe, that the sender is a victim of fraud or that the transaction relates to a crime or violation of law, rule, or regulation.
5. The refund request does not include sufficient information to enable the licensee to identify the sender or, in the event the sender has multiple transactions outstanding, the particular transaction to be refunded.
6. The money received for transmission is subject to the federal remittance rule, 12 CFR 1005, subpart B.
7. The money was received for transmission pursuant to a written agreement between the licensee and payee to process payments for goods or services provided by the payee.
(3) Receipts. (a) Except as provided in par. (b), a licensee or its authorized delegate shall provide the sender a receipt for money received for transmission. The receipt shall be in English and in the language principally used by the licensee or authorized delegate to advertise, solicit, or negotiate transactions conducted in person, electronically, or by phone, if other than English, and shall include all the following information, as applicable:
1. The name of the sender.
2. The name of the designated recipient.
3. The date of the transaction.
4. The unique transaction or identification number.
5. The licensee’s name, business address, and customer service telephone number.
6. The amount of the transaction in U.S. dollars.
7. Any fee charged by the licensee to the sender for the transaction.
8. Any taxes collected by the licensee from the sender for the transaction.
(b) Paragraph (a) does not apply if any of the following circumstances exist:
1. The money received for transmission is subject to the federal remittance rule, 12 CFR 1005, subpart B.
2. The money received for transmission is not primarily for personal, family, or household purposes.
3. The money is received for transmission pursuant to a written agreement between the licensee and payee to process payments for goods or services provided by the payee.
217.10 Prudential standards. (1) Net worth. A licensee shall maintain at all times a tangible net worth in excess of the greater of $100,000 or the sum of the following: 3 percent of the licensee’s first $100,000,000 in total assets, plus 2 percent of any additional assets up to $1,000,000,000, plus 0.5 percent of any additional assets over $1,000,000,000. The division may exempt an applicant or licensee from this requirement, in whole or in part, if the division finds the exemption to be in the public interest.
(2) Surety bond. A licensee shall at all times maintain a surety bond or other form of security acceptable to the division. The minimum required amount of the security shall be the greater of $100,000 or an amount equal to 100 percent of the licensee’s average daily money transmission liability in this state calculated for the most recently completed 3-month period, up to $500,000. A licensee that maintains security of at least $500,000 is not required to calculate its average daily money transmission liability in this state.
(3) Permissible investments. (a) A licensee shall maintain at all times permissible investments that have a market value computed in accordance with U.S. generally accepted accounting principles of not less than the aggregate amount of all of the licensee’s outstanding money transmission obligations.
(b) The following are permissible investments for purposes of par. (a):
1. Cash, including demand deposits, savings deposits, and funds in such accounts held for the benefit of the licensee’s customers, maintained in a federally insured depository financial institution.
2. Cash equivalents, including automated clearing house items in transit to the licensee, automated clearing house items or international wires in transit to a payee, cash in transit via armored car, cash in smart safes, cash in licensee-owned locations, debit card or credit card-funded transmission receivables owed by any bank, and money market mutual funds rated “AAA” by S&P, or the equivalent from any eligible rating service.
3. Certificates of deposit or senior debt obligations of a federally insured depository financial institution.
4. An obligation of the United States or a commission, agency, or instrumentality thereof.
