2007 Oregon Code - Chapter 717 :: Chapter 717 - Money Transmission
Chapter 717 —
Money Transmission
2007 EDITION
MONEY TRANSMISSION
FINANCIAL INSTITUTIONS
717.200Â Â Â Â Definitions
717.205Â Â Â Â License
required to conduct money transmission business; relationship to banking
717.210Â Â Â Â Exemptions;
waiver; rules
717.215Â Â Â Â Requirements
for licensees; net worth; permissible investments
717.220Â Â Â Â License
application; rules
717.225Â Â Â Â Security
devices
717.230Â Â Â Â Application
fee
717.235Â Â Â Â License
issuance; grounds for disapproval of application; appeals
717.240Â Â Â Â License
renewal; annual fee; renewal report; license suspension
717.245Â Â Â Â Events
requiring filing of report with director
717.250Â Â Â Â Notice
of change or acquisition of control of licensee; waiver; rules
717.255Â Â Â Â Examination
of licensee; notice; costs
717.260Â Â Â Â Retention
of records
717.265Â Â Â Â Suspension
or revocation of license; appeals
717.270Â Â Â Â Conduct
of money transmission business through authorized delegates; contracts
717.275Â Â Â Â Requirements
for authorized delegates
717.280Â Â Â Â Order
suspending or barring authorized delegate; grounds; appeals
717.285Â Â Â Â Limit
on responsibility of licensee; costs and attorney fees
717.290Â Â Â Â Cease
and desist order; appeals
717.295Â Â Â Â Injunctions;
consent orders
717.300Â Â Â Â Subpoena
authority
717.305Â Â Â Â Consent
to jurisdiction of courts; director as agent for service of process
717.310Â Â Â Â Rules
717.315Â Â Â Â Deposit
of moneys in Consumer and Business Services Fund
717.320Â Â Â Â Short
title
717.900Â Â Â Â Civil
penalties
717.905Â Â Â Â Criminal
penalties
     717.010 [1965 c.503 §2; 1973 c.797 §403; 1985 c.762 §51;
1987 c.373 §55; 1993 c.744 §23; repealed by 1999 c.571 §30]
     717.020 [1965 c.503 §1; repealed by 1999 c.571 §30]
     717.030 [1965 c.503 §3; 1973 c.797 §404; repealed by
1999 c.571 §30]
     717.040 [1965 c.503 §4; 1973 c.797 §405; repealed by
1999 c.571 §30]
     717.050 [1965 c.503 §5; 1973 c.797 §406; repealed by
1999 c.571 §30]
     717.060 [1965 c.503 §6; 1973 c.797 §407; repealed by
1999 c.571 §30]
     717.070 [1965 c.503 §7(1); 1973 c.797 §408; 1977
c.135 §40; repealed by 1999 c.571 §30]
     717.075 [1973 c.797 §409; repealed by 1999 c.571 §30]
     717.080 [1965 c.503 §7(2), (3); 1973 c.797 §410;
1991 c.331 §118; 1997 c.631 §527; repealed by 1999 c.571 §30]
     717.084 [1973 c.797 §411; repealed by 1999 c.571 §30]
     717.086 [1973 c.797 §412; 1991 c.331 §119; repealed
by 1999 c.571 §30]
     717.090 [1965 c.503 §8; 1973 c.797 §413; 1991 c.331 §120;
repealed by 1999 c.571 §30]
     717.095 [1977 c.135 §39; 1985 c.762 §52; repealed by
1999 c.571 §30]
     717.100 [1965 c.503 §9; 1973 c.797 §414; repealed by
1999 c.571 §30]
     717.110 [1965 c.503 §10; 1973 c.797 §415; repealed
by 1999 c.571 §30]
     717.120 [1965 c.503 §11; 1973 c.797 §416; repealed
by 1999 c.571 §30]
     717.130 [1965 c.503 §12; 1973 c.797 §417; repealed
by 1999 c.571 §30]
     717.140 [1965 c.503 §13; repealed by 1999 c.571 §30]
     717.150 [1965 c.503 §14; 1973 c.797 §418; repealed
by 1999 c.571 §30]
     717.160 [1955 c.503 §15; 1971 c.734 §173; 1973 c.797
§419; repealed by 1999 c.571 §30]
     717.200
Definitions. As used in ORS
717.200 to 717.320, 717.900 and 717.905, unless the context requires otherwise:
     (1) “Applicant” means a person filing an
application for a license under ORS 717.200 to 717.320, 717.900 and 717.905.
     (2) “Authorized delegate” means a person
designated by the licensee under the provisions of ORS 717.200 to 717.320,
717.900 and 717.905 to sell or issue payment instruments or engage in the
business of transmitting money on behalf of a licensee.
     (3) “Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through ownership of voting
securities, by contract or otherwise.
     (4) “Controlling person” means any person
in control of a licensee or applicant for a license.
     (5) “Controlling shareholder” means any
person, or group of persons acting in concert, that owns 25 percent or more of
any voting class of an applicantÂ’s stock.
     (6) “Director” means the Director of the
Department of Consumer and Business Services.
     (7) “Electronic instrument” means a card
or other tangible object for the transmission or payment of money that contains
a microprocessor chip, magnetic stripe or other means for the storage of
information, that is prefunded and for which the value is decremented upon each
use. “Electronic instrument” does not include a card or other tangible object
that is redeemable by the issuer in the issuerÂ’s goods or services.
     (8) “Executive officer” means the licensee’s
president, chairperson of the executive committee, senior officer responsible
for the licenseeÂ’s business, chief financial officer and any other person who
performs similar functions.
     (9) “Licensee” means a person licensed
under ORS 717.200 to 717.320, 717.900 and 717.905.
     (10) “Material litigation” means any
litigation that, according to generally accepted accounting principles, is
deemed significant to an applicantÂ’s or licenseeÂ’s financial health and would
be required to be referenced in the applicantÂ’s or licenseeÂ’s annual audited
financial statements, report to shareholders or similar documents.
     (11) “Money transmission” means the sale or
issuance of payment instruments or engaging in the business of receiving money
for transmission or transmitting money within the United States or to locations
abroad by any and all means, including but not limited to payment instrument,
wire, facsimile or electronic transfer.
     (12) “Payment instrument” means any
electronic or written check, draft, money order, travelerÂ’s check or other
electronic or written instrument or order for the transmission or payment of
money, sold or issued to one or more persons, whether or not the instrument is
negotiable. “Payment instrument” does not include any credit card voucher, any
letter of credit or any instrument that is redeemable by the issuer in goods or
services.
     (13) “Outstanding payment instrument”
means any payment instrument issued by a licensee that has been sold in the
United States directly by the licensee or any payment instrument issued by a
licensee that has been sold in the United States by an authorized delegate of
the licensee, that has been reported to the licensee as having been sold and
that has not yet been paid by or for the licensee.
     (14) “Permissible investments” means:
     (a) Cash;
     (b) Certificates of deposit or other debt
obligations of a financial institution, either domestic or foreign;
     (c) Bills of exchange or time drafts drawn
on and accepted by a commercial bank, otherwise known as bankersÂ’ acceptances,
that are eligible for purchase by member banks of the Federal Reserve System;
     (d) Any investment security bearing a
rating of one of the three highest grades as defined by a nationally recognized
organization that rates such securities;
     (e) Investment securities that are
obligations of the United States Government, its agencies or instrumentalities,
or obligations that are guaranteed fully as to principal and interest by the
United States, or any obligations of any state, municipality or any political
subdivision thereof;
     (f) Shares in a money market mutual fund,
interest-bearing bills, notes or bonds, debentures or stock traded on any national
securities exchange or national market system, mutual funds primarily composed
of such securities or a fund composed of one or more permissible investments as
set forth herein;
     (g) Any demand borrowing agreement or
agreements made to a corporation or a subsidiary of a corporation whose capital
stock is listed on a national securities exchange;
     (h) Receivables that are due to a licensee
from the licenseeÂ’s authorized delegates under a contract described in ORS
717.270 and that are not past due or doubtful of collection; or
     (i) Any other investments or security
device approved by the Director of the Department of Consumer and Business
Services.
     (15) “Person” means any individual,
partnership, association, joint stock association, limited liability company,
trust or corporation.
     (16) “Remit” means either to make direct
payment of the funds to a licensee or representatives of a licensee authorized
to receive those funds, or to deposit the funds in a bank, credit union or
savings and loan association or other similar financial institution in an
account specified by the licensee.
     (17) “Security device” means a surety
bond, irrevocable letter of credit issued by an insured institution as defined
in ORS 706.008 or other similar security acceptable to the Director of the
Department of Consumer and Business Services. [1999 c.571 §2; 2001 c.104 §283]
     717.205
License required to conduct money transmission business; relationship to
banking. (1) A person, other
than a person that is exempt under ORS 717.210, may not conduct a money
transmission business without a license as provided in ORS 717.200 to 717.320,
717.900 and 717.905.
     (2) A licensee may conduct business in
this state at one or more locations that are directly or indirectly owned by
the licensee, or through one or more authorized delegates, or both. A licensee
is required to obtain only one license under ORS 717.200 to 717.320, 717.900
and 717.905.
     (3) The conduct of a money transmission
business by itself does not constitute banking or branch banking for the
purposes of the Bank Act.
     (4) The Director of the Department of
Consumer and Business Services has jurisdiction over a person conducting a
money transmission business whether or not the person is a licensee or
authorized delegate. [1999 c.571 §3]
     717.210
Exemptions; waiver; rules.
(1) ORS 717.200 to 717.320, 717.900 and 717.905 do not apply to:
     (a) Any company that accepts deposits in
this state and that is insured under the Federal Deposit Insurance Act, 12
U.S.C. 1811 et seq., as amended.
     (b) Credit unions or trust companies.
     (c) The United States Government or any
department, agency or instrumentality thereof.
     (d) The
     (e) Any state or political subdivision of
a state.
     (f) The provision or electronic transfer
of government benefits for any federal, state or county government or other
agency as defined in the Federal Reserve Board Regulation E (12 C.F.R. part
205), by a contractor for and on behalf of the United States Government or any
department, agency or instrumentality of the United States, or any state or any
political subdivision of a state.
     (g) The provision or handling of
electronic or other transfer of escrowed moneys by an escrow agent licensed
under ORS 696.511.
     (h) Authorized delegates of a licensee,
acting within the scope of authority conferred by a written contract as
described in ORS 717.270.
     (i) Any bank holding company as defined in
the federal Bank Holding Company Act of 1956, 12 U.S.C. 1841 et seq., as
amended, or any financial holding company as defined in ORS 706.008.
     (j) Any savings and loan holding company
as defined in 12 U.S.C. 1467a (a)(1)(D), as amended.
     (2) The Director of the Department of
Consumer and Business Services by rule or order may modify or waive the
application of ORS 717.200 to 717.320, 717.900 and 717.905 to any person or
group of persons if the director determines that adequate regulation of the
person or group of persons is provided by law or by another agency of this
state.
     (3) The director by rule or order may temporarily
suspend the application of ORS 717.200 to 717.320, 717.900 and 717.905 to any
person or group of persons while the director considers whether an exemption
should be granted and during the pendency of any rulemaking proceeding
proposing to create an exemption. [1999 c.571 §4; 2001 c.377 §50]
     717.215
Requirements for licensees; net worth; permissible investments. (1) Each licensee shall at all times have a
net worth of not less than $100,000, calculated in accordance with generally
accepted accounting principles. Licensees engaging in money transmission at
more than one location or through authorized delegates shall have an additional
net worth of $25,000 per location in this state, not to exceed a maximum of
$500,000.
     (2) Every applicant, at the time of filing
of an application for a license under ORS 717.200 to 717.320, 717.900 and
717.905 and at all times after a license is issued, shall be in good standing
in the state of its incorporation or organization.
     (3) Each licensee shall at all times
possess permissible investments having an aggregate market value, calculated in
accordance with generally accepted accounting principles, of not less than the
aggregate face amount of all outstanding payment instruments issued or sold by
the licensee in the United States. This requirement may be waived by the
Director of the Department of Consumer and Business Services if the dollar
volume of a licenseeÂ’s outstanding payment instruments does not exceed the
amount of any security device posted by the licensee under ORS 717.225.
     (4) In the event of the bankruptcy of the
licensee, permissible investments, even if commingled with other assets of the
licensee, are considered by operation of law to be held in trust for the
benefit of the purchasers and holders of the licenseeÂ’s outstanding payment
instruments. [1999 c.571 §5]
     717.220
License application; rules.
(1) Each application for a license under ORS 717.200 to 717.320, 717.900 and
717.905 shall be made in writing in a form prescribed by rule by the Director
of the Department of Consumer and Business Services.
     (2) For all applicants, the application
shall contain:
     (a) The exact name of the applicant, the
applicantÂ’s principal address, any fictitious name, assumed business name or
trade name used by the applicant in the conduct of its business and the
location of the applicantÂ’s business records;
     (b) The history of the applicant’s
material litigation and criminal convictions for the five-year period prior to
the date of the application;
     (c) A history of operations and a
description of the business activities in which the applicant seeks to be
engaged in this state;
     (d) A list identifying the applicant’s
proposed authorized delegates in the state, if any, at the time of the filing
of the license application;
     (e) A sample authorized delegate contract,
if applicable;
     (f) A sample form of payment instrument,
if applicable;
     (g) The address of each location at which
the applicant and its authorized delegates, if any, propose to conduct a money
transmission business in this state;
     (h) The name and address of the clearing
bank or banks on which the applicantÂ’s payment instruments will be drawn or
through which such payment instruments will be payable; and
     (i) A business plan.
     (3) If the applicant is a corporation, the
application shall contain:
     (a) The date of the applicant’s
incorporation and state of incorporation;
     (b) A certificate of good standing from
the state in which the applicant was incorporated;
     (c) A description of the corporate
structure of the applicant, including the identity of any parent or subsidiary
of the applicant, and the disclosure of whether any parent or subsidiary is
publicly traded on any stock exchange;
     (d) The name, business and residence
address, and employment history for the past five years of the applicantÂ’s
executive officers and the officers or managers who will be in charge of the
applicantÂ’s money transmission business;
     (e) The name, business and residence
address, and employment history for the five-year period prior to the date of
the application of any controlling shareholder of the applicant;
     (f) The history of material litigation and
criminal convictions for the five-year period prior to the date of the
application of every executive officer or controlling shareholder of the
applicant;
     (g) A copy of the applicant’s most recent
audited financial statement, including balance sheet, statement of income or
loss, statement of changes in shareholder equity and statement of changes in
financial position and, if available, a copy of the applicantÂ’s audited
financial statements for the immediately preceding two-year period. If the
applicant is a wholly owned subsidiary of another corporation, the applicant
may submit either the parent corporationÂ’s consolidated audited financial
statements for the current year and for the immediately preceding two-year
period, or the parent corporationÂ’s Form 10K reports filed with the United
States Securities and Exchange Commission for the prior three years, in lieu of
the applicantÂ’s financial statements. If the applicant is a wholly owned
subsidiary of a corporation having its principal place of business outside the
United States, similar documentation filed with the parent corporationÂ’s
foreign regulator may be submitted to satisfy the requirements of this
paragraph; and
     (h) Copies of all filings, if any, made by
the applicant with the United States Securities and Exchange Commission, or
with a similar regulator in a country other than the
     (4) If the applicant is not a corporation,
the application shall contain:
     (a) The name, business and residence
address, personal financial statement and employment history for the past five
years of each principal of the applicant and the name, business and residence
address, and employment history for the past five years of any other person or
persons that will be in charge of the applicantÂ’s money transmission business;
     (b) The history of material litigation and
criminal convictions for the five-year period prior to the date of the
application for each individual having any ownership interest in the applicant
and each individual who exercises supervisory responsibility with respect to
the applicantÂ’s activities; and
     (c) Copies of the applicant’s audited
financial statements, including balance sheet, statement of income or loss, and
statement of changes in financial position, for the current year and, if
available, a copy of the applicantÂ’s audited financial statements for the
immediately preceding two-year period.
     (5) The director, for good cause shown,
may waive any requirement of this section with respect to any license
application or may allow an applicant to submit substituted information in a
license application in lieu of the information required under subsection (2) of
this section. [1999 c.571 §6; 2005 c.21 §12]
     717.225
Security devices. (1) Each
license application shall be accompanied by a security device in the amount of
$25,000. If the applicant proposes to engage in business under ORS 717.200 to
717.320, 717.900 and 717.905 at more than one location through authorized
delegates or otherwise, the amount of the security device shall increase by
$5,000 per location, not to exceed a maximum of $150,000. The security device shall
be in a form satisfactory to the Director of the Department of Consumer and
Business Services and shall run to the State of Oregon for the benefit of any
claimants against the licensee to secure the faithful performance of the
obligations of the licensee with respect to the receipt, handling, transmission
and payment of money in connection with the sale and issuance of payment
instruments or transmission of money. The aggregate liability on any security
device shall not exceed the principal sum of the security device. Claimants
against the licensee may bring suit directly on the security device or the
director may bring suit on behalf of such claimants, either in one action or in
successive actions.
     (2) In lieu of the requirements of
subsection (1) of this section, a licensee may deposit with the director, or
with insured institutions as defined in ORS 706.008 located in this state and
designated by the licensee and approved by the director, securities in an
aggregate amount, based upon principal amount or market value, whichever is
lower, of not less than the amount of the security device applicable under
subsection (1) of this section or portion thereof. The securities shall be held
to secure the same obligations as would the security device. The depositor
shall be entitled to receive all interest and dividends on the securities and
may, with the approval of the director, substitute other securities for those
deposited. The director, in writing, for good cause shown, may require the
depositor to substitute other securities for those deposited. As used in this
subsection, “securities” includes interest-bearing stocks and bonds, notes,
debentures or other obligations of the United States Government or any agency
or instrumentality of the United States Government, or guaranteed by the United
States Government, or of this state, or of a city, county, district or
instrumentality of this state, or guaranteed by this state.
     (3) The security device shall remain in
effect until cancellation, which may occur only after 30 daysÂ’ written notice
to the director. Cancellation shall not affect any liability incurred or
accrued during the 30-day period.
     (4) The security device shall remain in
place for no longer than five years after the licensee ceases money transmission
operations in this state. However, notwithstanding this provision, the director
may permit the security device to be reduced or eliminated prior to that time
to the extent that the amount of the licenseeÂ’s payment instruments outstanding
in this state are reduced. The director may also permit a licensee to
substitute a letter of credit or such other form of security device acceptable
to the director for the security device in place at the time the licensee
ceases money transmission operations in this state.
     (5) In the event of bankruptcy of the
licensee, the security device shall be considered by operation of law to be
held in trust for the benefit of purchasers and holders of the licenseeÂ’s
outstanding payment instruments. [1999 c.571 §7]
     717.230
Application fee. Each
application shall be accompanied by a nonrefundable application fee in the
amount of $1,000, payable to the Director of the Department of Consumer and
Business Services. The application fee shall also constitute the license fee
for the applicantÂ’s first year of activities if the license is granted. [1999
c.571 §8]
     717.235
License issuance; grounds for disapproval of application; appeals. (1) Upon the filing of a complete
application, the Director of the Department of Consumer and Business Services
shall review the application and may investigate the financial condition and
responsibility, financial and business experience, character and general
fitness of the applicant. The director may conduct an on-site investigation of
the applicant, the reasonable cost of which shall be paid by the applicant. The
director may disapprove an application if the director finds that the
applicant:
     (a) Is insolvent, either in the sense that
the personÂ’s liabilities exceed the personÂ’s assets or that the person cannot
meet obligations as they mature, or that the person is in such financial
condition that the person cannot continue in business with safety to the personÂ’s
customers;
     (b) Has engaged in dishonest, fraudulent
or illegal practices or conduct in any business or profession;
     (c) Has willfully or repeatedly violated
or failed to comply with any provisions of the Oregon Bank Act, Oregon
Securities Law, Savings Association Act, Oregon Credit Union Act, Oregon
Consumer Finance Act or Pawnbrokers Act or any rule or order of the director
adopted under those laws;
     (d) Has been convicted of a crime, an
essential element of which is fraud;
     (e) Is not qualified to engage in the
business of money transmission on the basis of such factors as training,
experience and knowledge of the business;
     (f) Is permanently or temporarily enjoined
by a court of competent jurisdiction from engaging in or continuing any conduct
or practice involving any aspect of the banking business or of the money
transmission business;
     (g) Is the subject of an order of the
director subjecting the person to a fine or other civil penalty or removing the
person from an office in any entity regulated by the director; or
     (h) Is the subject of an order entered
within the past five years, subjecting the person to a fine or other civil
penalty or removing the person from an office in a state or federally
chartered, licensed or regulated financial services company.
     (2) The director may also disapprove an
application if the director finds that any controlling person is subject to any
provision of subsection (1) of this section except subsection (1)(a) or (e) of
this section. If a controlling person is the sole owner of the applicant, then
the director may disapprove an application if the director finds that the
controlling person is subject to any provision of subsection (1) of this
section.
     (3) If the director finds that the
applicantÂ’s business will be conducted honestly, fairly and in a manner
commanding the confidence and trust of the community, and that the applicant
has fulfilled the requirements imposed by ORS 717.200 to 717.320, 717.900 and
717.905 and has paid the required license fee, the director shall issue a
license to the applicant authorizing the applicant to conduct money transmission
business in this state for a term of one year. If these requirements have not
been met, the director shall deny the application in writing and shall describe
the reasons for the denial.
     (4) An order of the director denying an
application under ORS 717.200 to 717.320, 717.900 and 717.905 shall state the
grounds upon which the order is based and shall not become effective for at
least 20 days after written notice of the order has been sent by registered or
certified mail to the applicant at the principal place of business of the
applicant.
     (5) Appeals from an order of the director
denying an application may be taken to the courts of this state as provided by
ORS chapter 183. [1999 c.571 §9]
     717.240
License renewal; annual fee; renewal report; license suspension. (1) Each licensee shall pay to the Director
of the Department of Consumer and Business Services a nonrefundable annual fee
of $500 or such other fee as established by the director by rule, not to exceed
$1,000, for renewal of a license.
     (2) At the time the licensee pays the
renewal fee, the licensee shall submit an annual renewal report in a form
prescribed by the director. The annual renewal report shall include:
     (a) A copy of the licensee’s most recent
audited consolidated annual financial statement, including a balance sheet,
statement of income or loss, statement of changes in shareholder equity and
statement of changes in financial position. In the case of a licensee that is a
wholly owned subsidiary of another corporation, the consolidated audited annual
financial statement of the parent corporation may be filed in lieu of the
licenseeÂ’s audited annual financial statement;
     (b) For the most recent quarter for which
data are available prior to the date of the renewal application, but not more than
120 days prior to the renewal date, a description of the number of payment
instruments sold by the licensee in this state, the dollar amount of those
instruments and the dollar amount of those instruments currently outstanding;
     (c) A description of any material changes
to any of the information submitted by the licensee on the licenseeÂ’s original
application that have not previously been reported to the director on any other
report required to be filed with the director;
     (d) A list of the licensee’s permissible
investments; and
     (e) A list of the locations within this
state at which business regulated by ORS 717.200 to 717.320, 717.900 and
717.905 is being conducted by either the licensee or its authorized delegate.
     (3) If a licensee has not filed a renewal
report or paid the renewal fee before the license expires, and has not been
granted an extension of time to do so by the director, the director shall hold
a hearing at which the licensee may show cause as to why the license should not
be suspended pending compliance with the requirements of this section. The
director shall notify the licensee in writing of the licenseeÂ’s rights under
this subsection. The licensee may waive the hearing. [1999 c.571 §10]
     717.245
Events requiring filing of report with director. Within 15 days following the occurrence of
any one of the events listed in this section, a licensee shall file a written
report with the Director of the Department of Consumer and Business Services
describing the event and the eventÂ’s expected effect on the licenseeÂ’s
activities in this state:
     (1) The filing for bankruptcy or
reorganization by the licensee or the licenseeÂ’s sole owner;
     (2) The commencement of revocation or
suspension proceedings against the licensee by any state or governmental
authority with regard to the licenseeÂ’s money transmission activities;
     (3) Any felony indictment of the licensee
or any of its key officers or directors;
     (4) Any felony conviction of the licensee
or any of its key officers or directors; or
     (5) The theft of payment instruments from
the licensee in an amount equal to or greater than 10 percent of a licenseeÂ’s
monthly amount of outstanding payment instruments. [1999 c.571 §11]
     717.250
Notice of change or acquisition of control of licensee; waiver; rules. (1) Within 15 days of a change or
acquisition of control of a licensee, the licensee shall provide notice of the
change to the Director of the Department of Consumer and Business Services in
writing and in a form the director may prescribe by rule. The notice shall be
accompanied by such information, data and records as the director may require
by rule.
     (2) Notwithstanding subsection (1) of this
section, the director may waive the notice requirement if the director
determines that the change in control does not pose any risk to the interests
of the public. [1999 c.571 §12]
     717.255
Examination of licensee; notice; costs. (1) The Director of the Department of Consumer and Business Services
may conduct an annual on-site examination of a licensee upon reasonable notice
to the licensee. The examination may be conducted at the principal place of
business of the licensee. Upon reasonable notice, the director may also conduct
an examination of any location of the licensee and its authorized delegates.
The on-site examination may be conducted in conjunction with examinations to be
performed by representatives of agencies of other states. In lieu of an annual
on-site examination, the director may accept the examination report of an
agency of another state or a report prepared by an independent accountancy
organization. Reports so accepted are considered for all purposes as an
official report of the director.
     (2) The director may conduct an on-site
examination of a licensee or any authorized delegate without prior notice to
the licensee or authorized delegate if the director has a reasonable basis to
believe that the licensee or authorized delegate is in violation of any
provision of ORS 717.200 to 717.320, 717.900 and 717.905. The examination may
be conducted at the principal place of business of the licensee or authorized
delegate.
     (3) The director shall have authority to
examine under oath all persons whose testimony the director may require in
order to conduct the examination.
     (4) Each licensee examined under this
section shall pay $60 per hour for each examiner, plus costs of an examination,
to the director. The director may maintain an action for the recovery of such
costs in any court of competent jurisdiction. [1999 c.571 §13; 2001 c.104 §284]
     717.260
Retention of records. (1)
Each licensee shall make, keep and preserve the following books, accounts and
other records for a period of three years:
     (a) A record of each payment instrument
sold;
     (b) A general ledger, posted at least once
per month, containing all assets, liabilities, capital, income and expense
accounts;
     (c) Settlement sheets received from
authorized delegates;
     (d) Bank statements and bank
reconciliation records;
     (e) Records of outstanding payment
instruments;
     (f) Records of each payment instrument
paid within the three-year period; and
     (g) A list of the names and addresses of
all the licenseeÂ’s authorized delegates.
     (2) Books, accounts and other records
required to be maintained under subsection (1) of this section may be
maintained:
     (a) In a photographic, electronic or other
similar form.
     (b) At a location outside this state, so
long as the books, accounts and other records are made accessible to the
Director of the Department of Consumer and Business Services following seven
days’ written notice. [1999 c.571 §14]
     717.265
Suspension or revocation of license; appeals. (1) The Director of the Department of Consumer and Business Services
may by order suspend or revoke a license issued under ORS 717.200 to 717.320,
717.900 and 717.905 if the director finds that:
     (a) Any fact or condition exists that, if
it had existed at the time when the licensee applied for a license, would have
been grounds for denying the application;
     (b) The licensee’s net worth is inadequate
and the licensee, following 10 daysÂ’ written notice from the director, fails to
take such steps as the director considers necessary to remedy the inadequacy;
     (c) The licensee has violated any material
provision of ORS 717.200 to 717.320, 717.900 and 717.905 or of any rule or order
validly adopted or issued by the director under ORS 717.200 to 717.320, 717.900
and 717.905;
     (d) The licensee is conducting its
business in an unsafe or unsound manner;
     (e) The licensee is insolvent;
     (f) The licensee has suspended payment of
its obligations, has made an assignment for the benefit of its creditors or has
admitted in writing its inability to pay its debts as they become due;
     (g) The licensee has applied for an
adjudication of bankruptcy, reorganization, arrangement or other relief under
any bankruptcy proceeding;
     (h) The licensee refuses to permit the
director to make any examination authorized by ORS 717.200 to 717.320, 717.900
and 717.905;
     (i) The licensee knowingly fails to make
any report required by ORS 717.200 to 717.320, 717.900 and 717.905;
     (j) The licensee has failed to maintain
the security device or other securities as required by ORS 717.225;
     (k) The licensee has engaged in fraud in
the conduct of the money transmission business;
     (L) The licensee knowingly has submitted false
information to the director; or
     (m) The licensee has failed to terminate
an authorized delegate when so ordered by the director.
     (2) The suspension or revocation of a
license shall not:
     (a) Affect the licensee’s civil or
criminal liability for acts committed prior to the suspension or revocation;
     (b) Affect the liability of the surety on
the licenseeÂ’s security device; or
     (c) Entitle the licensee to a return of
any part of the license or renewal fee.
     (3) Except for nonpayment of any fees
required by ORS 717.200 to 717.320, 717.900 and 717.905 and except as provided
in subsection (4) of this section, a license shall not be revoked or suspended
by the director without opportunity for a hearing in accordance with ORS
chapter 183.
     (4) If required to protect the public
interest, a license may be suspended without a hearing in accordance with ORS
183.430 (2).
     (5) An order of the director revoking or
suspending a license issued under ORS 717.200 to 717.320, 717.900 and 717.905
shall state the grounds upon which the order is based and, except for a summary
order issued in accordance with ORS 183.430 (2), shall not become effective for
at least 20 days after written notice of the order has been sent by registered
or certified mail to the licensee at the principal place of business of the
licensee.
     (6) Appeals from an order of the director
revoking or suspending a license may be taken to the courts of this state as
provided by ORS chapter 183. [1999 c.571 §15]
     717.270
Conduct of money transmission business through authorized delegates; contracts. Licensees desiring to conduct a money
transmission business through authorized delegates shall authorize each
delegate to operate pursuant to an express written contract. The contract shall
specify the following:
     (1) That the licensee appoints the person
as the licenseeÂ’s delegate with authority to engage in money transmission on
behalf of the licensee;
     (2) That neither a licensee nor an
authorized delegate may authorize subdelegates without the written consent of
the Director of the Department of Consumer and Business Services; and
     (3) That licensees, authorized delegates
and subdelegates are subject to supervision and regulation by the director. [1999
c.571 §16]
     717.275
Requirements for authorized delegates. (1) An authorized delegate shall not make any fraudulent or false
statement or misrepresentation to a licensee or to the Director of the
Department of Consumer and Business Services.
     (2) All money transmission activities
conducted by authorized delegates shall be strictly in accordance with the
licenseeÂ’s written procedures provided to the authorized delegate.
     (3) An authorized delegate shall remit all
money owing to the licensee in accordance with the terms of the contract
between the licensee and the authorized delegate. The failure of an authorized
delegate to remit all money owing to a licensee within the time prescribed
shall result in liability of the authorized delegate to the licensee for three
times the licenseeÂ’s actual damages.
     (4) An authorized delegate is considered
to consent to the directorÂ’s inspection, with or without prior notice to the
licensee or authorized delegate, of the books and records of the authorized
delegate when the director has a reasonable basis to believe that the licensee
or authorized delegate is in noncompliance with ORS 717.200 to 717.320, 717.900
and 717.905.
     (5) An authorized delegate is under a duty
to act only as authorized under the contract with the licensee. An authorized
delegate that exceeds the delegateÂ’s authority is subject to cancellation of
the delegateÂ’s contract and further disciplinary action by the director.
     (6) All funds, not including fees,
received by an authorized delegate from the sale or delivery of a payment
instrument issued by a licensee, or received by an authorized delegate for
transmission, shall constitute trust funds owned by and belonging to the
licensee during the period beginning when the funds are received by the
authorized delegate and ending when the funds or an equivalent amount are
remitted by the authorized delegate to the licensee. If an authorized delegate
commingles any such funds with any other funds or property owned or controlled
by the authorized delegate, all commingled proceeds and other property shall be
impressed with a trust in favor of the licensee in an amount equal to the
amount of the proceeds due the licensee.
     (7) An authorized delegate shall report to
the licensee the theft or loss of payment instruments within 24 hours from the
time the authorized delegate first knows of the theft or loss. [1999 c.571 §17]
     717.280
Order suspending or barring authorized delegate; grounds; appeals. (1) For any reason specified in subsection
(2) of this section, the Director of the Department of Consumer and Business
Services may issue an order suspending or barring an authorized delegate from
continuing to be or becoming an authorized delegate during the period specified
in the order. An order issued under this section shall require the licensee to
terminate the licenseeÂ’s relationship with the authorized delegate during the
period specified in the order.
     (2) The director may issue an order under
subsection (1) of this section if the director finds that an authorized
delegate or any director, officer, employee or controlling person of the
authorized delegate has:
     (a) Violated any provision of ORS 717.200
to 717.320, 717.900 and 717.905 or of any rule adopted or order issued under
ORS 717.200 to 717.320, 717.900 and 717.905;
     (b) Engaged or participated in any unsafe
or unsound act with respect to the business of selling or issuing payment
instruments of the licensee or the business of money transmission; or
     (c) Made or caused to be made in any
application or report filed with the director, or in any proceeding before the
director, any statement that was, at the time and in the circumstances under
which it was made, false or misleading with respect to any material fact, or
has omitted to state in any such application or report any material fact that
is required to be stated in the application or report.
     (3) Except as provided in subsection (4)
of this section, the director shall not issue an order under this section
without opportunity for a hearing in accordance with ORS chapter 183.
     (4) If required for the immediate
protection of the public interest, an authorized delegate may be suspended
without a hearing in accordance with ORS 183.430 (2).
     (5) An order of the director suspending or
barring an authorized delegate under this section shall state the grounds upon
which the order is based and, except for a summary order issued in accordance
with ORS 183.430 (2), shall not become effective for at least 20 days after
written notice of the order has been sent by registered or certified mail to
the authorized delegate at the authorized delegateÂ’s principal place of
business.
     (6) Appeals from an order of the director
suspending or barring an authorized delegate may be taken to the courts of this
state as provided by ORS chapter 183. [1999 c.571 §18]
     717.285
Limit on responsibility of licensee; costs and attorney fees. (1) The responsibility of a licensee to any
person for a money transmission conducted on that personÂ’s behalf by the
licensee or the licenseeÂ’s authorized delegate shall be limited to the amount
of money transmitted or the face amount of the payment instrument purchased
plus statutory interest.
     (2) In addition to any amounts under
subsection (1) of this section, the court may award a prevailing party
reasonable costs and attorney fees. [1999 c.571 §19]
     717.290
Cease and desist order; appeals. (1) If the Director of the Department of Consumer and Business
Services determines that any person has engaged in, is engaging in or is about
to engage in any act or practice constituting a violation of ORS 717.200 to
717.320 or of any rule adopted or order issued under ORS 717.200 to 717.320,
the director may:
     (a) Order the person to cease and desist
from the unlawful act or practice; and
     (b) Take any affirmative action as may be
necessary to carry out the provisions of ORS 717.200 to 717.320, including
assessing the costs of any investigation.
     (2) Except as provided in subsection (3)
of this section, the director may not issue an order under this section without
opportunity for a hearing in accordance with ORS chapter 183.
     (3) If required for the immediate
protection of the public interest, the director may issue a cease and desist
order without a hearing in accordance with ORS 183.430 (2).
     (4) A cease and desist order of the
director under ORS 717.200 to 717.320, 717.900 and 717.905 must state the
grounds upon which the order is based and, except for a summary order issued in
accordance with ORS 183.430 (2), does not become effective for at least 20 days
after written notice of the order has been sent by registered or certified mail
to the person at the personÂ’s principal place of business.
     (5) Appeals from a cease and desist order
of the director may be taken to the courts of this state as provided by ORS
chapter 183. [1999 c.571 §20; 2005 c.338 §23]
     717.295
Injunctions; consent orders.
(1) If the Director of the Department of Consumer and Business Services
believes that any person has engaged in, is engaging in or is about to engage
in any act or practice constituting a violation of any provision of ORS 717.200
to 717.320, 717.900 and 717.905, or of any rule or order adopted or issued
under ORS 717.200 to 717.320, 717.900 and 717.905, the director may initiate an
action in the Circuit Court for Marion County to enjoin the act or practice and
to enforce compliance with any provision of ORS 717.200 to 717.320, 717.900 and
717.905 or of any rule or order adopted or issued under ORS 717.200 to 717.320,
717.900 and 717.905. Upon a proper showing, a permanent or temporary
injunction, restraining order or writ of mandamus shall be granted or a
receiver or conservator may be appointed for the defendantÂ’s assets. The
director shall not be required to post a bond. The court may award a prevailing
party reasonable attorney fees and costs.
     (2) The director may enter into consent
orders at any time with any person to resolve any matter arising under ORS
717.200 to 717.320, 717.900 and 717.905. A consent order must be signed by the
person to whom it is issued or a duly authorized representative, and must
indicate agreement to the terms contained in the consent order. A consent order
need not constitute an admission by any person that any provision of ORS
717.200 to 717.320, 717.900 and 717.905, or of any rule or order adopted or
issued under ORS 717.200 to 717.320, 717.900 and 717.905, has been violated,
nor need it constitute a finding by the director that the person has violated
any provision of ORS 717.200 to 717.320, 717.900 and 717.905, or of any rule or
order adopted or issued under ORS 717.200 to 717.320, 717.900 and 717.905.
     (3) Notwithstanding the issuance of a
consent order, the director may seek civil or criminal penalties or compromise
civil penalties concerning matters encompassed by the consent order, unless the
consent order by its terms expressly precludes the director from so doing. [1999
c.571 §22]
     717.300
Subpoena authority. (1) For
purposes of an investigation or proceeding under ORS 717.200 to 717.320,
717.900 and 717.905, the Director of the Department of Consumer and Business
Services may administer oaths and affirmations, subpoena witnesses and compel
their attendance, take evidence and require the production of books, papers,
correspondence, memoranda, agreements or other documents or records that the
director considers relevant or material to the inquiry. Each witness who
appears before the director under a subpoena shall receive the fees and mileage
provided for witnesses in ORS 44.415 (2).
     (2) If a person fails to comply with a
subpoena issued pursuant to this section or a party or witness refuses to
testify on any matter, the judge of the circuit court of any county, on the
application of the director, shall compel obedience by proceedings for contempt
as in the case of disobedience of the requirements of a subpoena issued from
the court or a refusal to testify. [1999 c.571 §23]
     717.305
Consent to jurisdiction of courts; director as agent for service of process. (1) Any licensee, authorized delegate or
other person that knowingly engages in the money transmission business under
ORS 717.200 to 717.320, 717.900 and 717.905, with or without filing a license
application, is considered to have:
     (a) Consented to the jurisdiction of the
courts of this state for all actions arising under ORS 717.200 to 717.320,
717.900 and 717.905; and
     (b) Appointed the Director of the Department
of Consumer and Business Services as the licenseeÂ’s, delegateÂ’s or personÂ’s
lawful agent for the purpose of accepting service of process in any action,
suit or proceeding that may arise under ORS 717.200 to 717.320, 717.900 and
717.905.
     (2) Within three business days after
service of process upon the director, the director shall transmit by certified
mail copies of all lawful process accepted by the director as an agent to the
person for whom service of process is accepted at the personÂ’s last known
address. Service of process shall be considered complete three business days
after the director deposits copies of the documents in the
     717.310
Rules. (1) The Director of
the Department of Consumer and Business Services may adopt rules for the
purpose of carrying out the provisions of ORS 717.200 to 717.320, 717.900 and
717.905.
     (2) In addition to the notice requirements
of ORS chapter 183, before the director adopts a permanent rule, the director
shall submit a copy of the proposed rule to each licensee. [1999 c.571 §25]
     717.315
Deposit of moneys in Consumer and Business Services Fund. All fees, charges, costs and fines collected
by the Director of the Department of Consumer and Business Services under ORS
717.200 to 717.320, 717.900 and 717.905 shall be paid to the State Treasurer
and credited as provided in ORS 705.145. [1999 c.571 §28]
     717.320
Short title. ORS 717.200 to
717.320, 717.900 and 717.905 may be cited as the “Oregon Money Transmitters
Act.” [1999 c.571 §27]
     717.900
Civil penalties. (1) If the
Director of the Department of Consumer and Business Services finds that a
person has violated any provision of ORS 717.200 to 717.320, 717.900 and
717.905, or of a rule adopted or order issued under ORS 717.200 to 717.320,
717.900 and 717.905, the director may impose a civil penalty in an amount
specified by the director, not to exceed $1,000 for each violation or, in the
case of a continuing violation, $1,000 for each day that the violation
continues. Civil penalties under this section shall be imposed in the manner
described in ORS 183.745. A penalty shall not be assessed under this section
until after the person subject to the penalty has been notified in writing of
the nature of the violation and has been afforded a reasonable period of time,
as set forth in the notice, to correct the violation and has failed to do so.
     (2) Appeals from orders of the director
under this section may be taken to the courts of this state as provided by ORS
chapter 183.
     (3) The director may compromise and settle
with and collect civil penalties from any person for violations of any
provision of ORS 717.200 to 717.320, 717.900 and 717.905, or of any rule
adopted or order issued under ORS 717.200 to 717.320, 717.900 and 717.905. [1999
c.571 §21]
     717.905
Criminal penalties. (1)
Except as provided in this section, violation of any provision of ORS 717.200
to 717.320, 717.900 and 717.905 is a Class A misdemeanor.
     (2) Any person that makes a material,
false statement in any document filed or required to be filed under ORS 717.200
to 717.320, 717.900 and 717.905 with the intent to deceive the recipient of the
document is guilty of a Class C felony.
     (3) Any person that engages in the
business of money transmission without a license is guilty of a Class C felony.
[1999 c.571 §24]
     717.910 [1975 c.544 §54; 1991 c.734 §95; repealed by
1999 c.571 §30]
     717.990 [1965 c.503 §16; 1973 c.797 §420; repealed
by 1975 c.544 §62]
_______________
CHAPTERS 718 TO 720
[Reserved for expansion]
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