2016 North Dakota Century Code Title 13 Debtor and Creditor Relationship Chapter 13-09 Money Transmitters
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CHAPTER 13-09
MONEY TRANSMITTERS
13-09-01. License required.
1. On or after January 2, 2006, a person, except a person that is exempt pursuant to
section 13-09-03, may not engage in the business of money transmission without a
license as provided in this chapter.
2. A person not licensed under this chapter or not an authorized delegate of a licensee is
engaged in providing money transmission if the person provides those services to
residents of this state, even if that person has no physical presence in this state.
3. If a licensee has a physical presence in this state, the licensee may conduct its
business at one or more locations, directly or indirectly owned, or through one or more
authorized delegates, or both, pursuant to the single license granted to the licensee.
13-09-02. Definitions.
In this chapter, unless the context otherwise requires:
1. "Applicant" means a person filing an application for a license under this chapter.
2. "Authorized delegate" means an entity designated by the licensee under the provisions
of this chapter to sell or issue payment instruments or engage in the business of
transmitting money on behalf of a licensee.
3. "Commissioner" means the commissioner of the department of financial institutions.
4. "Control" means ownership of, or the power to vote, twenty-five percent or more of the
outstanding voting securities of a licensee or controlling person. For purposes of
determining the percentage of a licensee controlled by any person, there must be
aggregated with the person's interest the interest of any other person controlled by that
person or by any spouse, parent, or child of that person.
5. "Controlling person" means any person in control of a licensee.
6. "Department" means the department of financial institutions.
7. "Electronic instrument" means a card or other tangible object for the transmission or
payment of money that contains a microprocessor chip, magnetic strip, or other means
for the storage of information, that is prefunded and for which the value is
decremented upon each use, but does not include a card or other tangible object that
is redeemable by the issuer in goods or services provided by the issuer or its affiliates.
8. "Executive officer" means the licensee's president, chairman of the executive
committee, senior officer responsible for the licensee's business, chief financial officer,
and any other person who performs similar functions.
9. "Key shareholder" means any person or group of persons acting in concert who is or
are the owner of twenty-five percent or more of any voting class of an applicant's
stock.
10. "Licensee" means a person licensed under this chapter.
11. "Material litigation" means any litigation that, according to generally accepted
accounting principles, is deemed significant to an applicant's or licensee's financial
health and would be required to be referenced in that entity's annual audited financial
statements, report to shareholders, or similar documents.
12. "Monetary value" means a medium of exchange, whether or not redeemable in money.
13. "Money transmission" means to engage in the business of the sale or issuance of
payment instruments, stored value, or of receiving money or monetary value for
transmission to a location within or outside the United States by any and all means,
including wire, facsimile, or electronic transfer. Notwithstanding any other provision of
law, "money transmission" also includes bill payment services not limited to the right to
receive payment of any claim for another, but does not include payment processing
activities conducted for a merchant under an agency relationship.
14. "Outstanding payment instrument" means any payment instrument issued by the
licensee which has been sold in the United States directly by the licensee or any
payment instrument issued by the licensee which has been sold by an authorized
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delegate of the licensee in the United States, which has been reported to the licensee
as having been sold, and which has not yet been paid by or for the licensee.
"Payment instrument" means any electronic or written check, draft, money order,
traveler's check, or other electronic or written instrument or order for the transmission
or payment of money, sold or issued to one or more persons, whether or not such
instrument is negotiable. The term "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.
"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 bankers' acceptances, which are eligible for purchase by
member banks of the federal reserve system;
d. Any investment 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, its agencies or
instrumentalities, or obligations that are guaranteed fully as to principal and
interest of 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 or notes or bonds,
debentures or stock traded on any national securities exchange or on a national
over-the-counter market, or 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 exchange;
h. Receivables that are due to a licensee from its authorized delegates pursuant to
a contract described in section 13-09-15, which are not past-due or doubtful of
collection; or
i. Any other investments or security device approved by the commissioner.
"Remit" means either to make direct payment of the funds to the licensee or its
representatives 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.
"Stored value" means monetary value that is evidenced by an electronic record.
13-09-03. Exclusions.
This chapter does not apply to:
1. The United States or any department, agency, or instrumentality thereof;
2. The United States post office;
3. The state or any political subdivisions thereof;
4. Banks, bank holding companies, credit unions, building and loan associations, savings
and loan associations, or savings banks or mutual banks organized under the laws of
any state or the United States, but this exemption does not extend to any other person
acting on behalf of any such excluded entity;
5. The provision of electronic transfer of government benefits for any federal, state, or
county governmental agency as defined in federal reserve board regulation E, by a
contractor for and on behalf of the United States or any department, agency, or
instrumentality thereof, or any state or any political subdivisions thereof; and
6. Authorized delegates of a licensee, acting within the scope of authority conferred by a
written contract as described in section 13-09-15.
13-09-04. Licensed qualifications.
To qualify for a license each applicant must satisfy the following requirements:
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Each licensee under this chapter must at all times have a net worth of not less than
one hundred thousand dollars, calculated in accordance with generally accepted
accounting principles.
The financial condition and responsibility, financial and business experience, and
character and general fitness of the applicant must reasonably warrant the belief that
the applicant's business will be conducted honestly, fairly, and in a manner
commanding the confidence and trust of the community. In determining whether this
qualification is met and for purposes of investigating compliance with this chapter, the
commissioner may review and consider the relevant business records and capital
adequacy of the applicant.
Every corporate applicant, at the time of filing of an application for a license under this
chapter and at all times after a license is issued, must be in good standing in the state
of its incorporation. At the time of the filing of an application for a license under this
chapter and at all times after a license is issued, all noncorporate applicants must be
registered or qualified to do business in the state.
13-09-05. Bond or other security device.
1. Each application must be accompanied by a surety bond, irrevocable letter of credit, or
such other similar security device, hereinafter "security device", acceptable to the
commissioner in the amount of one hundred fifty thousand dollars. The commissioner
may increase the amount of the bond or security device to a maximum of five hundred
thousand dollars for good cause. The security device must be in a form satisfactory to
the commissioner and must run to the state 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 and transmission of money. In the
case of a bond, the aggregate liability of the surety may not exceed the principal sum
of the bond. Claimants against the licensee may themselves bring suit directly on the
security device or the commissioner may bring suit on behalf of such claimants, either
in one action or in successive actions.
2. In lieu of a security device or of any portion of the principal thereof, as required by this
section, the licensee may deposit with the commissioner, or with banks in this state as
the licensee may designate and the commissioner may approve, cash,
interest-bearing stocks and bonds, notes, debentures, or other obligations of the
United States or any agency or instrumentality thereof, or guaranteed by the United
States, or of this state, or of a city, county, school district, or instrumentality of this
state, or guaranteed by this state, to an aggregate amount, based upon principal
amount or market value, whichever is lower, of not less than the amount of the security
device or portion thereof. The securities and cash must be deposited as aforesaid and
held to secure the same obligations as would the security device, but the depositor is
entitled to receive all interest and dividends thereon, with the approval of the
commissioner may substitute other securities for those deposited, and must be
required so to do on written order of the commissioner made for good cause shown.
3. The security device must remain in effect until cancellation, which may occur only after
thirty days' written notice to the commissioner. Cancellation does not affect any liability
incurred or accrued during the period.
4. The security device must remain in place for at least five years after the licensee
ceases money transmission operations in the state. However, notwithstanding this
provision, the commissioner may permit the security device to be reduced or
eliminated before that time to the extent that the amount of the licensee's payment
instruments outstanding in this state are reduced. The commissioner may also permit
a licensee to substitute a letter of credit or such other form of security device
acceptable to the commissioner for the security device in place at the time the licensee
ceases money transmission operations in the state.
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13-09-06. Permissible investments and statutory trust.
1. Each licensee under this chapter must 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 and stored value issued or sold by the licensee in the United
States. This requirement may be waived by the commissioner if the dollar volume of a
licensee's outstanding payment instruments and stored value does not exceed the
bond or other security devices posted by the licensee pursuant to section 13-09-05.
2. Permissible investments, even if commingled with other assets of the licensee, are
deemed by operation of law to be held in trust for the benefit of the purchasers and
holders of the licensee's outstanding payment instruments in the event of the
bankruptcy of the licensee.
13-09-07. Application for license.
1. Each application for a license under this chapter must be in the form prescribed by the
commissioner. Each application must state or contain:
a. For all applicants:
(1) The exact name of the applicant, the applicant's principal address, any
fictitious or trade name used by the applicant in the conduct of its business,
and the location of the applicant's business records.
(2) The history of the applicant's criminal convictions and material litigation for
the five-year period before the date of the application.
(3) A description of the activities conducted by the applicant and a history of
operations.
(4) A description of the business activities in which the applicant seeks to be
engaged in the state.
(5) A list identifying the applicant's proposed authorized delegates in the state, if
any, at the time of the filing of the license application.
(6) A sample authorized delegate contract, if applicable.
(7) A sample form of payment instrument, if applicable.
(8) The locations at which the applicant and its authorized delegates, if any,
propose to conduct the licensed activities in the state.
(9) The name and address of the clearing bank or banks on which the
applicant's payment instruments will be drawn or through which the payment
instruments will be payable.
b. If the applicant is a corporation, the applicant must also provide:
(1) The date of the applicant's incorporation and state of incorporation.
(2) A certificate of good standing from the state in which the applicant was
incorporated.
(3) 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.
(4) The name, business and residence address, and employment history for the
past five years of the applicant's executive officers and the officers or
managers who will be in charge of the applicant's activities to be licensed
hereunder.
(5) The name, business and residence address, and employment history for the
period five years prior to the date of the application of any key shareholder
of the applicant.
(6) The history of criminal convictions and material litigation for the five-year
period before the date of the application of every executive officer or key
shareholder of the applicant.
(7) 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, the applicant's audited financial statements for the immediately
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preceding two-year period. However, if the applicant is a wholly owned
subsidiary of another corporation, the applicant may submit either the parent
corporation's consolidated audited financial statements for the current year
and for the immediately preceding two-year period or the parent
corporation's form 10K reports filed with the United States securities and
exchange commission for the prior three years in lieu of the applicant'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 corporation's non-United States
regulator may be submitted to satisfy this provision.
(8) 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 United States, within the year preceding the date of filing of
the application.
c. If the applicant is not a corporation, the applicant must also provide:
(1) 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 who will be in
charge of the applicant's activities to be licensed under this chapter;
(2) The place and date of the applicant's registration or qualification to do
business in this state;
(3) The history of criminal convictions and material litigation for the five-year
period before 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 applicant's activities; and
(4) 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, for the immediately preceding
two-year period.
d. For good cause shown, the commissioner may waive any requirement of this
section with respect to any license application or to permit a license applicant to
submit substituted information in its license application in lieu of the information
required by this section.
To fulfill the purposes of this chapter, the commissioner may establish relationships or
contracts with a nationwide multistate licensing system and registry or other entities
designated by a nationwide multistate licensing system and registry to collect and
maintain records and process transaction fees or other fees related to licensees or
other persons subject to the chapter. The applicant shall pay directly to such
nationwide multistate licensing system any additional fee relating to participation in
such nationwide multistate licensing system.
In connection with an application for licensing as a money transmitter, or any license
renewals, the applicant shall furnish to the nationwide multistate licensing system
information concerning the applicant's identity, which may include:
a. Fingerprints for submission to the federal bureau of investigation, and any
governmental agency or entity authorized to receive such information for a state,
national, and international criminal history background check, except that officers
and directors of a publicly traded company and subsidiaries of the publicly traded
company may not be required to submit fingerprints under this section;
b. Personal history and experience in a form prescribed by the nationwide multistate
licensing system, including the submission of authorization for the nationwide
multistate licensing system and the commissioner to obtain:
(1) An independent credit report obtained from a consumer reporting agency
described in section 603(p) of the Fair Credit Reporting Act; and
(2) Information related to any administrative, civil, or criminal findings by any
governmental jurisdiction; and
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Any other documents, information, or evidence the commissioner deems relevant
to the application regardless of the location, possession, control, or custody of
such documents, information, or evidence.
For the purposes of this section and in order to reduce the points of contact which the
federal bureau of investigation may have to maintain for purposes of subsection 3, the
commissioner may use the nationwide multistate licensing system and registry as a
channeling agent for requesting information from and distributing information to the
department of justice or any governmental agency.
For the purposes of this section and in order to reduce the points of contact which the
commissioner may have to maintain for purposes of subsection 3, the commissioner
may use the nationwide multistate licensing system and registry as a channeling agent
for requesting and distributing information to and from any source so directed by the
commissioner.
13-09-07.1. Change of name or address.
A licensee is required to submit within twenty business days of the date of change
notification of a change of name or change of address. The notification must be in the form
prescribed by the commissioner.
13-09-08. Application fee.
Each application must be accompanied by a nonrefundable investigation fee in the amount
of four hundred fifty dollars and license fee of four hundred dollars. The license fee must be
refunded if the application is denied. The commissioner shall deposit fees and costs collected
by the department under this chapter in the department of financial institutions regulatory fund.
13-09-09. Issuance of license.
1. Upon the filing of a complete application, the commissioner shall investigate the
financial condition and responsibility, financial and business experience, character, and
general fitness of the applicant. The commissioner may conduct an onsite investigation
of the applicant, the reasonable cost of which must be borne by the applicant. If the
commissioner finds that the applicant'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 this chapter and has paid the
required license fee, the commissioner shall issue a license to the applicant
authorizing the applicant to engage in the licensed activities in this state. If these
requirements have not been met, the commissioner shall deny the application in
writing, setting forth the reasons for the denial.
2. The commissioner shall approve or deny every application for an original license within
one hundred twenty days from the date a complete application is submitted, which
period may be extended by the written consent of the applicant. The commissioner
shall notify the applicant of the date when the application is deemed complete.
3. Any applicant aggrieved by a denial issued by the commissioner under this chapter
may at any time within thirty days from the date of receipt of written notice of the denial
request a hearing before the commissioner.
13-09-10. Renewal of license and annual report.
1. A licensee under this chapter shall pay an annual renewal fee of four hundred fifty
dollars which is not subject to refund.
2. The renewal fee must be accompanied by a report, in a form prescribed by the
commissioner, which must include:
a. A copy of its most recent audited consolidated annual financial statement
including balance sheet, statement of income or loss, statement of changes in
shareholder's equity, and statement of changes in financial position, or, in the
case of a licensee that is a wholly owned subsidiary of another corporation, the
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consolidated audited annual financial statement of the parent corporation may be
filed in lieu of the licensee's audited annual financial statement;
b. For the most recent quarter for which data is available before the date of the filing
of the renewal application, but in no event more than one hundred twenty days
before the renewal date, the licensee must provide the number of payment
instruments sold by the licensee in the state, the dollar amount of those
instruments, and the dollar amount of those instruments currently outstanding;
c. Any material changes to any of the information submitted by the licensee on its
original application which have not previously been reported to the commissioner
on any other report required to be filed under this chapter;
d. A list of the licensee's permissible investments; and
e. A list of the locations, if any, within this state at which business regulated by this
chapter is being conducted by either the licensee or its authorized delegates.
All licenses issued pursuant to this chapter expire on December thirty-first of each
year. Applications for renewal must be submitted thirty days before expiration of the
license. A licensee that has not filed a renewal report or paid its renewal fee by
December thirty-first and has not been granted an extension of time to do so by the
commissioner must have its license suspended. The licensee in such case has thirty
days after its license is suspended in which to file a renewal report and pay the
renewal fee, plus fifty dollars for each business day after suspension that the
commissioner does not receive the renewal report and the renewal fee. For good
cause, the commissioner may grant an extension of the renewal date or reduce or
suspend the fifty dollars per day late filing fee.
13-09-10.1. Automatic six-month extension of license during 2014 calendar year.
All current licensees who have made payment of a fee in accordance with sections
13-09-08 and 13-09-10, for a money transmitter license effective after July 1, 2013, shall be
granted an extension of their current license until December 31, 2014. If at any time prior to
December 31, 2014, a licensee's license expires or otherwise terminates under this chapter, the
applicant shall be required to pay licensing fees in accordance with section 13-09-08, and that
license will expire on December 31, 2014.
13-09-11. Extraordinary reporting requirements.
Within fifteen business days of the occurrence of any one of the events listed below, a
licensee shall file a written report with the commissioner describing such event and its expected
impact on the licensee's activities in the state:
1. Any material changes in information provided in a licensee's application or renewal
report;
2. The filing for bankruptcy or reorganization by the licensee;
3. The institution of revocation or suspension proceedings against the licensee by any
state or governmental authority with regard to the licensee's money transmission
activities;
4. Any felony indictment of the licensee or any of its key officers or directors related to
money transmission activities; and
5. Any felony conviction of the licensee or any of its key officers or directors related to
money transmission activities.
13-09-12. Changes in control of a licensee.
1. A licensee shall give the commissioner written notice of a proposed change of control
within fifteen days after learning of the proposed change of control and request
approval of the acquisition.
2. After review of a request for approval under subsection 1, the commissioner may
require the licensee to provide additional information concerning the proposed persons
in control of the licensee. The additional information must be limited to the same types
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required of the licensee or persons in control of the licensee as part of its original
license or renewal application.
The commissioner shall approve a request for change of control under subsection 1 if,
after investigation, the commissioner determines that the person or group of persons
requesting approval has the competence, experience, character, and general fitness to
operate the licensee or person in control of the licensee in a lawful and proper manner
and that the interests of the public will not be jeopardized by the change of control.
The following persons are exempt from the requirements of subsection 1, but the
licensee shall notify the commissioner of a change of control:
a. A person that acts as a proxy for the sole purpose of voting at a designated
meeting of the securityholders or holders of voting interests of a licensee or
person in control of a licensee;
b. A person that acquires control as a personal representative, custodian, guardian,
conservator, or trustee, or as an officer appointed by a court of competent
jurisdiction or by operation of law; and
c. A person that the commissioner by rule or order exempts in the public interest.
Before filing a request for approval to acquire control, a person may request in writing
a determination from the commissioner as to whether the person would be considered
a person in control of a licensee upon consummation of a proposed transaction.
13-09-13. Examinations.
1. The commissioner may conduct an annual onsite examination of a licensee upon
reasonable written notice to the licensee. The commissioner may examine a licensee
without prior notice if the commissioner has a reasonable basis to believe that the
licensee is in noncompliance with this chapter. Should the commissioner conclude that
an onsite examination of a licensee is necessary, the licensee shall pay an
examination or visitation fee and the commissioner shall charge for the actual cost of
the examination or visitation at an hourly rate set by the commissioner which is
sufficient to cover all reasonable expenses associated with the examination or
visitation. The onsite examination may be conducted in conjunction with examinations
to be performed by representatives of agencies of another state or states. The
commissioner, in lieu of an onsite examination, may accept the examination report of
an agency of another state, or a report prepared by an independent accounting firm,
and reports so accepted are considered for all purposes as an official report of the
commissioner. The reasonable expenses incurred by the department, agencies of
another state, or an independent licensed or certified public accountant in making the
examination or report must be borne by the licensee.
2. The commissioner may request financial data from a licensee in addition to that
required under section 13-09-10, or conduct an onsite examination of any authorized
delegate or location of a licensee within this state without prior notice to the authorized
delegate or licensee only if the commissioner has a reasonable basis to believe that
the licensee or authorized delegate is in noncompliance with this chapter. When the
commissioner examines an authorized delegate's operations, the authorized delegate
shall pay all reasonably incurred costs of such examination. When the commissioner
examines a licensee's location within the state, the licensee shall pay all reasonably
incurred costs of such examination.
13-09-14. Maintenance of records.
1. Each licensee shall make, keep, and preserve the following books, accounts, and
other records for a period of five years and which are open to inspection by the
commissioner:
a. A record or records of each payment instrument and stored value sold;
b. A general ledger containing all assets, liability, capital, income, and expense
accounts, which general ledger must be posted at least monthly;
c. Bank statements and bank reconciliation records;
d. Records of outstanding payment instruments and stored value;
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Records of each payment instrument and stored value paid within the five-year
period;
f. A list of the names and addresses of all of the licensee's authorized delegates;
and
g. Any other records the commissioner reasonably requires by rule.
Maintenance of such documents as are required by this section in a photographic,
electronic, or other similar form constitutes compliance with this section.
Records may be maintained at a location other than within this state so long as the
records are made accessible to the commissioner on seven business days' written
notice. When a licensee ceases operations for any reason, the licensee shall inform
the department of the location of the records. In addition, the licensee shall provide the
name of the individual responsible for maintenance of the records. The licensee shall
notify the department within ten business days of the change of the location of the
records or the change of the individual responsible for maintenance of the records.
13-09-15. Authorized delegate contracts.
Licensees desiring to conduct licensed activities through authorized delegates shall
authorize each delegate to operate pursuant to an express written contract, which, for contracts
entered into after July 1, 2005, must provide the following:
1. That the licensee appoints the person as its 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 commissioner; and
3. That licensees are subject to supervision and regulation by the commissioner.
13-09-16. Authorized delegate conduct.
1. An authorized delegate may not make a fraudulent or false statement or
misrepresentation to a licensee or to the commissioner.
2. All money transmission or sale or issuance of payment instrument activities conducted
by authorized delegates must be strictly in accordance with the licensee's written
procedures provided to the authorized delegate.
3. An authorized delegate must remit all money owing to the licensee in accordance with
the terms of the contract between the licensee and the authorized delegate.
4. An authorized delegate is deemed to consent to the commissioner's inspection, with or
without prior notice to the licensee or authorized delegates.
5. An authorized delegate is under a duty to act only as authorized under the contract
with the licensee and this chapter and an authorized delegate who exceeds its
authority is subject to cancellation of its contract and further disciplinary action by the
commissioner.
6. All funds, less fees, received by an authorized delegate of a licensee from the sale or
delivery of a payment instrument issued by a licensee or received by an authorized
delegate for transmission must, from the time such funds are received by such
authorized delegate until such time when the funds or an equivalent amount are
remitted by the authorized delegate to the licensee, constitute trust funds owned by
and belonging 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 is impressed with a trust in favor of the
licensee in an amount equal to the amount of the proceeds due the licensee.
13-09-17. Suspension or revocation of licenses.
1. The commissioner may issue and serve upon any licensee an order suspending or
revoking a licensee's license if the commissioner finds that:
a. Any fact or condition exists that, if it had existed at the time when the licensee
applied for its license, would have been grounds for denying such application;
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The licensee's net worth becomes inadequate and the licensee, after ten days'
written notice from the commissioner, fails to take such steps as the
commissioner deems necessary to remedy such deficiency;
c. The licensee knowingly violates any material provision of this chapter or any rule
or order validly adopted by the commissioner under authority of this title;
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, made an assignment for
the benefit of its creditors, or 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;
h. The licensee refuses to permit the commissioner to make any examination
authorized by this chapter;
i. The licensee willfully fails to make any report required by this chapter;
j. The licensee has failed to pay the annual license fee imposed under this chapter
or any examination fee imposed by the commissioner under the authority of this
chapter;
k. The licensee has failed to maintain the required bond or other security device; or
l. The licensee has failed to maintain registration with the secretary of state if so
required.
The order must contain a notice of opportunity for hearing pursuant to chapter 28-32.
If a hearing is not requested within twenty business days of the date the order is
served upon the licensee or if a hearing is held and the commissioner finds that the
record so warrants, the commissioner may enter a final order suspending or revoking
the license.
If the commissioner finds that probable cause for revocation of any license exists and
that enforcement of the chapter requires immediate suspension of such license
pending investigation, it may upon written notice enter an order temporarily
suspending such license for a period not exceeding sixty days, pending the holding of
a hearing as prescribed in this chapter.
13-09-18. Suspension or revocation of authorized delegates.
1. The commissioner may issue an order suspending or revoking the designation of an
authorized delegate, if the commissioner finds that:
a. The authorized delegate violates this chapter or a rule adopted or an order issued
under this chapter;
b. The authorized delegate does not cooperate with an examination or investigation
by the commissioner;
c. The authorized delegate engages in fraud, intentional misrepresentation, or gross
negligence;
d. The authorized delegate is convicted of a violation of a state or federal antimoney
laundering statute;
e. The competence, experience, character, or general fitness of the authorized
delegate or a person in control of the authorized delegate indicates that it is not in
the public interest to permit the authorized delegate to provide money services; or
f. The authorized delegate is engaging in an unsafe or unsound practice.
2. In determining whether an authorized delegate is engaging in an unsafe or unsound
practice, the commissioner may consider the size and condition of the authorized
delegate's provision of money services, the magnitude of the loss, if any, the gravity of
the violation of this chapter, and the previous conduct of the authorized delegate.
3. An authorized delegate may appeal from a suspension or revocation of designation as
an authorized delegate by filing a written appeal with the commissioner within twenty
days of the issuance of the order.
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13-09-19. Orders to cease and desist.
1. If the commissioner determines that an unlicensed person, a licensee, or an
authorized delegate has committed a violation of this chapter or of a rule adopted or
an order issued under this chapter, the commissioner may issue an order to cease and
desist from the violation. The order becomes effective upon service.
2. The commissioner may issue an order against a licensee to cease and desist from
providing money transmission services through an authorized delegate that is the
subject of a separate order pursuant to section 13-09-18.
3. An order to cease and desist remains effective and enforceable pending the
completion of any administrative proceeding.
4. The entity against which a cease and desist order has been issued may appeal the
issuance of the cease and desist order by filing a written appeal with the commissioner
within twenty days of the date the order is served on the licensee or delegate.
5. The commissioner may apply to the district court for an appropriate order to protect the
public interest, including a temporary restraining order.
13-09-20. Consent orders.
The commissioner may enter into a consent order at any time with a person to resolve a
matter arising under this chapter. A consent order must be signed by the person to whom it is
issued or by the person's authorized representative, and must indicate agreement with the
terms contained in the order. A consent order may provide that it does not constitute an
admission by a person that this chapter or a rule adopted or an order issued under this chapter
has been violated.
13-09-21. Civil penalties.
The commissioner may impose a civil money penalty not to exceed five thousand dollars
per violation upon a person or agency who willfully violates a law, rule, written agreement, or
order under this chapter. An interested party may appeal the assessment of a civil money
penalty by filing a written notice of appeal within twenty days after service of the assessment of
civil money penalties. A civil money penalty collected under this section must be paid to the
state treasurer and deposited in the financial institutions regulatory fund.
13-09-22. Criminal penalties.
1. A person who intentionally makes a false statement, misrepresentation, or false
certification in a record filed or required to be maintained under this chapter, or that
intentionally makes a false entry or omits a material entry in such a record, is guilty of
a class C felony.
2. Any person violating any of the provisions of this chapter or any rule or order of the
department of financial institutions made pursuant to the provisions of this chapter or
who engages in any act, practice, or transaction declared by any provision of this
chapter to be unlawful is guilty of a class C felony.
3. An individual who knowingly engages in any activity for which a license is required
under this chapter without being licensed under this chapter is guilty of a class C
felony.
13-09-23. Administrative procedures.
All administrative proceedings under this chapter must be conducted in accordance with
chapter 28-32.
13-09-24. Savings and transitional provisions.
A license issued under the provisions of chapter 51-17 that is in effect immediately before
July 1, 2005, remains in force as a license under this chapter until the license's expiration date.
Thereafter, the licensee must be treated as if the licensee had applied for and had received a
license under this chapter and is required to comply with the renewal requirements set forth in
this chapter.
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13-09-25. Prohibited acts and practices.
It is a violation of this chapter for a person or individual subject to this chapter to knowingly:
1. Subscribe to, or make or cause to be made, any material false statement or
representation in any application or other document or statement required to be filed
under any provision of this chapter, or to omit to state any material statement or fact
necessary in order to make the statements made, in light of the circumstances under
which the statements are made, not misleading.
2. Directly or indirectly, employ any device, scheme, or artifice to defraud or mislead any
person.
3. Directly or indirectly, make any untrue statement of a material fact or to omit to state a
material fact.
4. Engage in any unfair or deceptive practice toward any person.
5. Conduct or solicit any business covered by this chapter without holding a valid license
as required under this chapter or assist or aid and abet any person in the conduct of
business under this chapter without a valid license as required under this chapter.
6. Fail to make disclosures as required by this chapter and any other applicable state or
federal law and regulations.
7. Fail to comply with this chapter or rules adopted under this chapter or fail to comply
with any other state or federal law, including the rules and regulations thereunder,
applicable to any business authorized or conducted under this chapter.
8. Make, in any manner, any false or deceptive statement or representation.
9. Negligently make any false statement or knowingly and willfully make any omission of
material fact in connection with any information or reports filed with a governmental
agency or in connection with any investigation conducted by the commissioner or
another governmental agency.
10. Collect, charge, attempt to collect or charge, or use or propose any agreement
purporting to collect or charge any fee prohibited by this chapter.
11. Fail to truthfully account for moneys belonging to or collected from another.
13-09-26. Confidentiality.
To promote more effective regulation and reduce regulatory burden through supervisory
information sharing, the commissioner or commissioner's designee may furnish information to or
receive information from a nationwide multistate licensing system for the purpose of regulation
of the financial services industry. Information furnished by the commissioner to any third party
which is confidential or privileged in the commissioner's possession remains confidential or
privileged in the possession of the third party. Information received by the commissioner from
any third party which is confidential or privileged in the third-party's possession remains
confidential or privileged in the commissioner's possession.
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