2005 Nevada Revised Statutes - Chapter 671 — Issuers of Instruments for Transmission or Payment of Money

CHAPTER 671 - ISSUERS OF INSTRUMENTS FORTRANSMISSION OR PAYMENT OF MONEY

NRS 671.010 Definitions.

NRS 671.020 Applicabilityof chapter.

NRS 671.030 Regulations.

NRS 671.040 Licenserequired.

NRS 671.050 Applicationfor license: Contents; bond or securities; financial statement; fees;regulations; withdrawal of application.

NRS 671.055 Applicationfor license: Additional requirements.

NRS 671.060 Investigationof applicant; issuance of license.

NRS 671.070 Expirationand renewal of license; fees; regulations.

NRS 671.080 Licensenot transferable or assignable; business must be conducted at specifiedlocation by agent of licensee; changes in location, name or operation of business.

NRS 671.090 Agentsof licensees: When license required; application; fees; regulations; withdrawalof application.

NRS 671.100 Bond:Amounts; form; notice to Commissioner; replenishment; liability of surety;increase in amount; cancellation or alteration.

NRS 671.110 Depositsin lieu of bond.

NRS 671.120 Examinationof licensee by Commissioner; entry upon premises and access to documents; fee;audit in lieu of examination.

NRS 671.140 Scheduleof rates: Posting; excess fees prohibited.

NRS 671.150 Depositof receipts; commingling prohibited; deposit if license suspended orterminated; assets must cover liabilities.

NRS 671.160 Discontinuanceof licensees business: Notice; surrender of license; order of Commissioner;possession of business and property by Commissioner; appointment of receiver.

NRS 671.170 Investigationsand hearings; confidential communications.

NRS 671.180 Suspension,revocation or denial of renewal of license: Notice; hearing; order; grounds;judicial review.

NRS 671.183 Failureto submit required report; fees; regulations.

NRS 671.185 Administrativefines.

NRS 671.190 Unlawfulacts; penalty; other remedies.

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NRS 671.010 Definitions. As used in this chapter, unless the context otherwiserequires:

1. Check means any check, draft, money order orother instrument used for the transmission or payment of money. Check doesnot include a travelers check.

2. Licensee means any person licensed under thischapter.

(Added to NRS by 1977, 1083; A 1985, 536)

NRS 671.020 Applicabilityof chapter.

1. This chapter does not apply to any:

(a) Bank, its parent or holding company or anysubsidiary thereof, trust company, savings bank, savings and loan association,credit union, industrial bank or industrial loan and investment company,organized and regulated under the laws of this state or of the United States;

(b) Foreign banking corporation licensed to do bankingbusiness in this state; or

(c) Telegraph company providing a public messageservice.

2. Subsection 1 does not reduce or alter any liabilityotherwise attaching to the sale, issuance, receipt for transmission ortransmission of checks or money in any form.

(Added to NRS by 1977, 1083; A 1983, 153)

NRS 671.030 Regulations. The Commissioner may adopt such reasonable regulations asmay be necessary or appropriate for the administration of this chapter.

(Added to NRS by 1977, 1083; A 1983, 1764; 1987,1950)

NRS 671.040 Licenserequired.

1. A person shall not engage in the business of sellingor issuing checks or of receiving for transmission or transmitting money orcredits unless he is licensed pursuant to this chapter.

2. A person shall not engage in such business as anagent except as an agent of a licensee or a payee.

(Added to NRS by 1977, 1083)

NRS 671.050 Applicationfor license: Contents; bond or securities; financial statement; fees;regulations; withdrawal of application.

1. Every application for a license required pursuantto this chapter must be in writing, signed by the applicant, and in the formprescribed by the Commissioner.

2. The application must contain:

(a) The name and principal business address of theapplicant and, if incorporated, the date and place of its incorporation;

(b) The name and address of each of the applicantsbranch offices, subsidiaries or affiliates, if any, which will be operatedunder the license;

(c) The name and addresses, business and residential,of the proprietor or partners of the applicant or, if the applicant is acorporation or association, of each of the directors, trustees and principalofficers, and of any stockholder who owns 20 percent or more of the applicantsstock; and

(d) Such other pertinent information as theCommissioner requires.

3. The application must be accompanied by:

(a) A surety bond or securities as required by thischapter.

(b) A certified financial statement, satisfactory tothe Commissioner, showing that the applicants net worth exceeds $100,000,unless the applicants surety bond or the securities deposited pursuant to NRS 671.110 are in at least twice the minimumprincipal sum required by NRS 671.100.

(c) A nonrefundable fee of not more than $500 for theapplication and survey. The applicant shall also pay such additional expensesincurred in the process of investigation as the Commissioner deems necessary.

(d) A fee of not less than $200 or more than $400,prorated on the basis of the licensing year as provided by the Commissioner.

4. The Commissioner shall adopt regulationsestablishing the amount of the fees required pursuant to this section. Allmoney received by the Commissioner pursuant to this section must be placed inthe Investigative Account created by NRS232.545.

5. The Commissioner shall consider an application tobe withdrawn if the Commissioner has not received all information and feesrequired to complete the application within 6 months after the date theapplication is first submitted to the Commissioner or within such later periodas the Commissioner determines in accordance with any existing policies ofjoint regulatory partners. If an application is deemed to be withdrawn pursuantto this subsection or if an applicant otherwise withdraws an application, theCommissioner may not issue a license to the applicant unless the applicantsubmits a new application and pays any required fees.

(Added to NRS by 1977, 1084; A 1981, 755; 1983, 1319,1764; 1987, 1950; 1991, 1810; 2005, 1854)

NRS 671.055 Applicationfor license: Additional requirements. In additionto any other requirements set forth by specific statute, each person whoapplies for a license to engage in the business of selling or issuing checks orof receiving for transmission or transmitting money or credits must submitproof satisfactory to the Commissioner that the person:

1. Is at least 21 years of age; and

2. Is a citizen of the United States or lawfullyentitled to remain and work in the United States.

(Added to NRS by 2005, 1854)

NRS 671.060 Investigationof applicant; issuance of license.

1. Upon the filing of the application, payment of thefees and approval of the surety bond or securities, the Commissioner shallinvestigate the financial condition and responsibility, the financial andbusiness experience, and the character and general fitness of the applicant andmay investigate any partners, directors, trustees or principal officers of theapplicant.

2. If the Commissioner determines that the business ofthe applicant will be conducted lawfully, honestly, fairly and efficiently, theCommissioner shall issue a license to the applicant to engage in the businessof selling and issuing checks, receiving for transmission or transmitting moneyor credits, or both.

(Added to NRS by 1977, 1084; A 1983, 1319, 1765;1987, 1951)

NRS 671.070 Expirationand renewal of license; fees; regulations.

1. A license issued pursuant to this chapter expireson June 30 of the year following its issuance and thereafter expires on June 30of each year, unless it is earlier surrendered, suspended or revoked.

2. The license may be renewed from year to year uponthe approval of the Commissioner if the licensee files an applicationconforming to the requirements for an initial application at least 60 daysbefore the expiration of his current license.

3. An application for the renewal of the license mustbe accompanied by a fee of not more than $400. No investigation fee may becharged for the renewal of the license. If the application or fee for renewalis not filed within the required time, the Commissioner may renew the expiredlicense upon receipt of the application and fee for renewal, and a fee of notmore than $400 for late renewal.

4. The Commissioner shall adopt regulationsestablishing the amount of the fees required pursuant to this section. All feescollected pursuant to this section must be deposited in the State Treasurypursuant to the provisions of NRS 658.091.

(Added to NRS by 1977, 1084; A 1981, 755, 991; 1983,1765; 1987, 1951; 1989, 920; 2003, 3228; 2005, 1855)

NRS 671.080 Licensenot transferable or assignable; business must be conducted at specifiedlocation by agent of licensee; changes in location, name or operation ofbusiness.

1. A license issued under this chapter is nottransferable or assignable.

2. The license entitles the holder to engage inbusiness only at the location or locations specified in his application or at alocation or locations operated by a duly appointed agent of the licensee.

3. A change must not be made in:

(a) The location of any place of business covered bythe license;

(b) The name of the licensed business; or

(c) The licensees operation or services if the natureof the change affects the qualification for the license,

withoutprior notice to and approval of the Commissioner.

(Added to NRS by 1977, 1084; A 1983, 1766; 1987,1951)

NRS 671.090 Agentsof licensees: When license required; application; fees; regulations; withdrawalof application.

1. A separate license is not required for an agent ofa licensee unless the agent directly sells or delivers the licensees checksover the counter to the public and, in the ordinary course of such business,receives or has access to:

(a) The licensees checks which, after payment, arereturned through banking channels or otherwise for verification, reconciliationor accounting with respect thereto; or

(b) Bank statements relating to checks so returned.

2. Each agent of a licensee who must be licensedpursuant to subsection 1 must:

(a) Submit an application to the Commissioner which isin writing, signed by the applicant and on a form prescribed by theCommissioner;

(b) Pay an application fee of not less than $200 andnot more than $500; and

(c) Pay a license fee of not less than $200 and notmore than $500.

3. The Commissioner shall adopt regulationsestablishing the amount of the fees required pursuant to this section.

4. The Commissioner shall consider an application tobe withdrawn if the Commissioner has not received all information and feesrequired to complete the application within 6 months after the date theapplication is first submitted to the Commissioner or within such later periodas the Commissioner determines in accordance with any existing policies ofjoint regulatory partners. If an application is deemed to be withdrawn pursuantto this subsection or if an applicant otherwise withdraws an application, theCommissioner may not issue a license to the applicant unless the applicantsubmits a new application and pays any required fees.

(Added to NRS by 1977, 1085; A 2005, 1855)

NRS 671.100 Bond:Amounts; form; notice to Commissioner; replenishment; liability of surety;increase in amount; cancellation or alteration.

1. Except as provided in NRS 671.110, each licensee shall have inforce a surety bond payable to the State of Nevada for the use and benefit ofany holder of any outstanding check sold or issued by a licensee in the normalcourse of business and for value in the following minimum principal sums:

(a) For the first location granted in the license,$10,000; and

(b) For each additional location in this state whereits business is conducted directly or through an agent, $5,000.

The maximumamount of any surety bond required under this subsection is $250,000.

2. The bond must be in a form satisfactory to theCommissioner, issued by a bonding company authorized to do business in thisstate, and must secure the faithful performance of the obligations of thelicensee respecting the sale or issuance of checks and receipt for transmissionor transmission of money or credits.

3. A licensee shall, within 10 days after thecommencement of any action or notice of entry of any judgment against him byany creditor or claimant arising out of business regulated by this chapter,give notice thereof to the Commissioner by registered or certified mail withdetails sufficient to identify the action or judgment. The surety shall, within10 days after it pays any claim or judgment to a creditor or claimant, givenotice thereof to the Commissioner by registered or certified mail with detailssufficient to identify the creditor or claimant and the claim or judgment sopaid.

4. Whenever the principal sum of the bond is reducedby recoveries or payments thereon, the licensee shall furnish:

(a) A new or additional bond so that the total oraggregate principal sum of the bonds equals the sum required under subsection1; or

(b) An endorsement, duly executed by the suretyreinstating the bond to the required principal sum.

5. The liability of the surety on the bond to acreditor or claimant is not affected by any misrepresentation, breach ofwarranty, failure to pay a premium or other act or omission of the licensee, orby any insolvency or bankruptcy of the licensee.

6. The liability of the surety continues as to alltransactions entered into in good faith by the creditors and claimants with thelicensees agents within 30 days after:

(a) The licensees death or the dissolution orliquidation of his business; or

(b) The termination of the bond,

whicheverevent occurs first.

7. Whenever the Commissioner determines that theprotection of the public so requires, he may order that an increase be made inthe principal sum of the bond of any licensee, except that the Commissioner maynot order an increase of more than $10,000 if the licensee has submitted acurrent financial statement, or more than $15,000 otherwise.

8. Neither a licensee nor his surety may cancel oralter a bond except after notice to the Commissioner by registered or certifiedmail. The cancellation or alteration is not effective until 10 days afterreceipt of the notice by the Commissioner. A cancellation or alteration doesnot affect any liability incurred or accrued on the bond before the expirationof the 30-day period designated in subsection 6.

(Added to NRS by 1977, 1085; A 1983, 1766; 1987,1951)

NRS 671.110 Depositsin lieu of bond.

1. In lieu of any surety bond, or any portion of theprincipal sum thereof as required by this chapter, a licensee may deposit withthe State Treasurer or with any bank, credit union or trust company authorizedto do business in this state as the licensee may select, with the approval ofthe Commissioner:

(a) Interest-bearing stocks;

(b) Bills, bonds, notes, debentures or otherobligations of the United States or any agency or instrumentality thereof, orguaranteed by the United States; or

(c) Any obligation of this state or any city, county,town, township, school district or other instrumentality of this state orguaranteed by this state,

in anaggregate amount of, based upon principal amount or market value, whichever islower, of not less than the amount of the required surety bond or portionthereof.

2. The securities must be held to secure the sameobligation as would the surety bond, but the depositor may receive any interestor dividends and, with the approval of the Commissioner, substitute othersuitable securities for those deposited.

(Added to NRS by 1977, 1086; A 1983, 1767; 1987,1953; 1999, 1545)

NRS 671.120 Examinationof licensee by Commissioner; entry upon premises and access to documents; fee;audit in lieu of examination.

1. Except as provided in subsection 4, once each yearthe Commissioner shall examine the financial accounts of each licensee and anyother documents relevant to the conduct of the licensees business, and theCommissioner may conduct examinations at additional times.

2. For the purpose of the examinations, theCommissioner may enter upon any of the business premises of a licensee or hisagents and obtain access to the relevant documents. Any obstruction or denialof such an entry or access is a violation of this chapter.

3. For each examination the Commissioner shall chargeand collect from the licensee a fee for conducting the examination and inpreparing and typing the report at the rate established pursuant to NRS 658.101.

4. The Commissioner may accept a report of an audit ofthe licensee which covers the most recent fiscal year in lieu of conducting anexamination.

(Added to NRS by 1977, 1086; A 1979, 956; 1983, 267,1767; 1987, 1953, 2224)

NRS 671.140 Scheduleof rates: Posting; excess fees prohibited. Inevery place of business licensed or covered by a license under this chapter,there shall be conspicuously posted at all times a schedule of the ratescharged for the sale or issuance of checks and the receipt for transmission ortransmission of money or credits. No fees may be charged or collected in excessof the posted rates.

(Added to NRS by 1977, 1087)

NRS 671.150 Depositof receipts; commingling prohibited; deposit if license suspended orterminated; assets must cover liabilities.

1. All money or credits received by an agent of alicensee from the sale and issuance of checks or for the purpose oftransmission must be remitted to the licensee or deposited with a bank orcredit union authorized to do business in this state for credit to an accountof the licensee not later than the third business day following its receipt.

2. Money received from the sale or issuance of checksor for the purpose of transmission must not be commingled with the other assetsof the licensee or his agents.

3. If a license is suspended or terminated, thelicensee shall immediately deposit in an account in the name of theCommissioner, an amount which is sufficient to make the total money in theaccount equal to all outstanding checks in the State of Nevada sold or issuedand money or credits received but not transmitted.

4. Each licensee shall at all times maintain liquidassets, government or municipal securities or other marketable securitieshaving a value, computed in accordance with generally accepted accountingprinciples, equal to or more than the aggregate liability of the licensee withrespect to checks sold and issued and money or credits received fortransmission.

(Added to NRS by 1977, 1087; A 1983, 1768; 1987,1953; 1999, 1545)

NRS 671.160 Discontinuanceof licensees business: Notice; surrender of license; order of Commissioner;possession of business and property by Commissioner; appointment of receiver.

1. Within 5 days after a discontinuance of alicensees business, he shall inform the Commissioner of the discontinuance andshall surrender his license for cancellation.

2. If, as a result of any investigation, hearing,report or examination, the Commissioner finds that a licensee is insolvent oris conducting his business in such a manner as to render his further operationshazardous to the public, the Commissioner may, through an order served byregistered or certified mail upon the licensee and any person possessing moneyof the licensee or his customers, require the immediate discontinuance of thedisbursement of the money and the cessation of the licensees business. Theorder remains in effect until:

(a) It is set aside, in whole or in part, by theCommissioner;

(b) The licensee has been adjudged a bankrupt; or

(c) A receiver for the licensee has been appointed by acourt of competent jurisdiction.

3. If a court does not have jurisdiction over thelicensee, the Commissioner may take possession of the licensees business andproperty until the licensee complies with the requirements of the Commissionerfor resumption of business or the licensees affairs are finally liquidated.

4. Whenever the Commissioner takes possession of alicensees business and property, the Commissioner may petition the court forappointment of a receiver to liquidate the affairs of the licensee.

(Added to NRS by 1977, 1087; A 1983, 1768; 1987,1954)

NRS 671.170 Investigationsand hearings; confidential communications.

1. The Commissioner may conduct any necessaryinvestigations and hearings to determine whether any licensee or other personhas violated any of the provisions of this chapter or whether any licensee hasconducted himself in a manner which requires the suspension, revocation ordenial of renewal of his license.

2. In conducting any investigation or hearing pursuantto this chapter, the Commissioner, or any person designated by him, may requirethe attendance and testimony of any person and compel the production of allrelevant books, records, accounts and other documents. The cost of anyexamination or investigation, not to exceed $10 an hour, must be borne by thelicensee.

3. The Commissioner may require any licensee to submitsuch reports concerning his business as the Commissioner deems necessary forthe enforcement of this chapter.

4. All reports of investigations and examinations andother reports rendered pursuant to this section, and all correspondence andmemoranda relating to or arising therefrom, including any authenticated copiesthereof in the possession of any licensee or the Commissioner, are confidentialcommunications, are not subject to any subpoena, and must not be made publicunless the Commissioner determines that justice and the public advantage willbe served by their publication. This subsection does not preclude any party toan administrative or judicial proceeding from introducing into evidence anyinformation or document otherwise available or admissible.

(Added to NRS by 1977, 1087; A 1983, 1769; 1987,1954)

NRS 671.180 Suspension,revocation or denial of renewal of license: Notice; hearing; order; grounds;judicial review.

1. If the Commissioner has reason to believe thatgrounds exist for the suspension, revocation or denial of renewal of a license,he shall give 10 days written notice to the licensee, stating the groundstherefor, and shall set a date for a hearing, if a hearing is requested by thelicensee. If the protection of the public so requires, the Commissioner maysuspend the license at any time before the hearing.

2. At the conclusion of the hearing, the Commissionershall enter a written order either dismissing the charges or suspending,revoking or denying the renewal of the license. The order must include astatement of the grounds for the action taken by the Commissioner and becomes effective10 days after receipt of a copy of the order by the licensee at his principalplace of business. The Commissioner may immediately suspend, revoke or deny therenewal of the license in a case where the licensee has failed to maintain ineffect the required surety bond or insurance policy.

3. The grounds for suspension, revocation or denial ofrenewal of a license are:

(a) Failure to pay the annual fee for renewal or thefee for late renewal;

(b) Failure to maintain in effect the required bond orsecurities;

(c) Fraud, misrepresentation or omission of anymaterial fact in any application, statement or report;

(d) Failure to pay any judgment arising from thelicensees business within 30 days after the judgment becomes final or within30 days after the expiration of a stay of execution on the judgment; or

(e) Violation of any provision of this chapter or anyregulation adopted or order issued by the Commissioner pursuant to thischapter.

4. Any action taken by the Commissioner pursuant tothis section is subject to judicial review in the first judicial districtcourt.

(Added to NRS by 1977, 1088; A 1983, 1769; 1987,1955; 1989, 920)

NRS 671.183 Failureto submit required report; fees; regulations.

1. If a licensee fails to submit any report requiredpursuant to this chapter or any regulation adopted pursuant thereto within theprescribed period, the Commissioner may impose and collect a fee of not morethan $10 for each day the report is overdue.

2. The Commissioner shall adopt regulationsestablishing the amount of the fee that may be imposed pursuant to thissection.

(Added to NRS by 2005, 1854)

NRS 671.185 Administrativefines. In addition to any other remedy or penalty,the Commissioner may impose an administrative fine of not more than $10,000upon a person who:

1. Without a license, conducts any business oractivity for which a license is required pursuant to the provisions of thischapter; or

2. Violates any provision of this chapter or anyregulation adopted pursuant thereto.

(Added to NRS by 2005, 1854)

NRS 671.190 Unlawfulacts; penalty; other remedies.

1. Any person who:

(a) Violates any provision of this chapter, or anyregulation adopted or order issued by the Commissioner pursuant to thischapter;

(b) Knowingly makes any false or misleading statementof a material fact in any application, statement or report filed pursuant tothis chapter;

(c) Knowingly omits to state any material factnecessary to provide the Commissioner with information lawfully required byhim; or

(d) Refuses to permit or obstructs any lawfulinvestigation, examination, entry or access by the Commissioner,

is guilty ofa misdemeanor.

2. Each day during which a violation continuesconstitutes a separate offense.

3. The imposition of any fine or term of imprisonmentpursuant to subsection 1:

(a) Is in addition to any suspension, revocation ordenial of renewal of a license which may result from the violation.

(b) Is not a bar to enforcement of this chapter by aninjunction or other appropriate civil remedy.

(Added to NRS by 1977, 1088; A 1983, 1770; 1987,1955)

 

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