Florida Senate - 2012                      CS for CS for SB 1586
       
       
       
       By the Committees on Budget Subcommittee on General Government
       Appropriations; and Banking and Insurance; and Senator Thrasher
       
       
       
       601-04294-12                                          20121586c2
    1                        A bill to be entitled                      
    2         An act relating to money services businesses; amending
    3         s. 560.103, F.S.; defining terms for purposes of
    4         provisions regulating money services businesses;
    5         amending s. 560.109, F.S.; revising the frequency and
    6         notice requirements for examinations and
    7         investigations by the Office of Financial Regulation
    8         of money services business licensees; amending s.
    9         560.111, F.S.; prohibiting money services businesses,
   10         authorized vendors, and affiliated parties from
   11         knowingly possessing certain paraphernalia used or
   12         intended or designed for use in misrepresenting a
   13         customer’s identity, for which penalties apply;
   14         prohibiting certain persons from providing a
   15         customer’s personal identification information to a
   16         money services business licensee and providing
   17         penalties; reenacting s. 560.114(1)(h), F.S., relating
   18         to penalties for certain prohibited acts by money
   19         services businesses, to incorporate the amendment made
   20         by the act to s. 560.111, F.S., in a reference
   21         thereto; amending s. 560.114, F.S.; prohibiting
   22         certain acts by money services businesses, authorized
   23         vendors, and affiliated parties, for which penalties
   24         apply; revising the conditions for which a money
   25         services business license may be suspended; amending
   26         ss. 560.126 and 560.309, F.S.; requiring a money
   27         services business licensee to maintain its own
   28         federally insured depository account and deposit into
   29         the account any payment instruments cashed; requiring
   30         a licensee to notify the office and cease to cash
   31         payment instruments if the licensee ceases to maintain
   32         the account; prohibiting a licensee from accepting or
   33         cashing a payment instrument from a conductor who is
   34         not the original payee; authorizing a licensee to
   35         accept or cash a corporate payment instrument from
   36         certain conductors; establishing a limit on the amount
   37         of fees that licensees may charge for the direct costs
   38         of verification of payment instruments cashed;
   39         amending s. 560.310, F.S.; revising requirements for
   40         the records that a money services business licensee
   41         must maintain related to the payment instruments
   42         cashed; creating s. 560.311, F.S.; requiring money
   43         services business licensees to submit certain
   44         transaction information to the Office of Financial
   45         Regulation related to the payment instruments cashed;
   46         requiring the office to maintain the transaction
   47         information in a centralized database; authorizing the
   48         Financial Services Commission to prescribe the time,
   49         format, and manner for licensees to submit the
   50         transaction information; requiring that the database
   51         be designed to interface with certain other state
   52         databases; providing a transaction fee for the
   53         submission of transaction information; authorizing the
   54         commission to adopt rules for the operation and
   55         security of the database; providing effective dates.
   56  
   57  Be It Enacted by the Legislature of the State of Florida:
   58  
   59         Section 1. Subsections (9) and (10) of section 560.103,
   60  Florida Statutes, are renumbered as subsections (11) and (12),
   61  respectively, present subsections (11) through (14) are
   62  renumbered as subsections (14) through (17), respectively,
   63  present subsections (15) through (27) are renumbered as
   64  subsections (19) through (31), respectively, present subsections
   65  (28) through (30) are renumbered as subsections (33) through
   66  (35), respectively, and new subsections (9), (10), (13), (18),
   67  and (32), are added to that section, to read:
   68         560.103 Definitions.—As used in this chapter, the term:
   69         (9) “Conductor” means a natural person who presents himself
   70  or herself to a licensee for purposes of cashing a payment
   71  instrument.
   72         (10) “Corporate payment instrument” means a payment
   73  instrument on which the payee named on the instrument’s face is
   74  other than a natural person.
   75         (13) “Department” means the Department of Financial
   76  Services.
   77         (18) “Fraudulent identification paraphernalia” means all
   78  equipment, products, or materials of any kind that are used,
   79  intended for use, or designed for use in the misrepresentation
   80  of a customer’s identity. The term includes, but is not limited
   81  to:
   82         (a) A signature stamp, thumbprint stamp, or other tool or
   83  device used to forge a customer’s personal identification
   84  information.
   85         (b) An original of any type of personal identification
   86  listed in s. 560.310(2)(b) which is blank, stolen, or unlawfully
   87  issued.
   88         (c) A blank, forged, fictitious, or counterfeit instrument
   89  in the similitude of any type of personal identification listed
   90  in s. 560.310(2)(b) which would in context lead a reasonably
   91  prudent person to believe that such instrument is an authentic
   92  original of such personal identification.
   93         (d) Counterfeit, fictitious, or fabricated information in
   94  the similitude of a customer’s personal identification
   95  information that, although not authentic, would in context lead
   96  a reasonably prudent person to credit its authenticity.
   97         (32) “Personal identification information” means a
   98  customer’s name that, alone or together with any of the
   99  following information, may be used to identify that specific
  100  customer:
  101         (a) Customer’s signature.
  102         (b) Photograph, digital image, or other likeness of the
  103  customer.
  104         (c) Unique biometric data, such as the customer’s
  105  thumbprint or fingerprint, voice print, retina or iris image, or
  106  other unique physical representation of the customer.
  107         Section 2. Subsections (1) and (7) of section 560.109,
  108  Florida Statutes, are amended to read:
  109         560.109 Examinations and investigations.—The office may
  110  conduct examinations and investigations, within or outside this
  111  state to determine whether a person has violated any provision
  112  of this chapter and related rules, or of any practice or conduct
  113  that creates the likelihood of material loss, insolvency, or
  114  dissipation of the assets of a money services business or
  115  otherwise materially prejudices the interests of their
  116  customers.
  117         (1) The office may, without advance notice, examine or
  118  investigate each licensee as often as is warranted for the
  119  protection of customers and in the public interest. However, the
  120  office must examine each licensee, but at least once every 5
  121  years. A new licensee shall be examined within 6 months after
  122  the issuance of the license. The office shall provide at least
  123  15 days’ notice to a money services business, its authorized
  124  vendor, or license applicant before conducting an examination or
  125  investigation. However, The office may, without advance notice,
  126  examine conduct an examination or investigate investigation of a
  127  money services business, authorized vendor, or affiliated party,
  128  or license applicant at any time and without advance notice if
  129  the office suspects that the money services business, authorized
  130  vendor, or affiliated party, or license applicant has violated
  131  or is about to violate any provision provisions of this chapter
  132  or any criminal law laws of this state or of the United States.
  133         (7) Reasonable and necessary costs incurred by the office
  134  or third parties authorized by the office in connection with
  135  examinations or investigations may be assessed against any
  136  person subject to this chapter on the basis of actual costs
  137  incurred. Assessable expenses include, but are not limited to,
  138  expenses for: interpreters; certified translations of documents
  139  into the English language required by this chapter or related
  140  rules; communications; legal representation; economic, legal, or
  141  other research, analyses, and testimony; and fees and expenses
  142  for witnesses. The failure to reimburse the office is a ground
  143  for denial of a license application, denial of a license
  144  renewal, or for revocation of any approval thereof. Except for
  145  examinations authorized under this section s. 560.109, costs may
  146  not be assessed against a person unless the office determines
  147  that the person has operated or is operating in violation of
  148  this chapter.
  149         Section 3. Paragraph (g) is added to subsection (1) of
  150  section 560.111, Florida Statutes, subsection (3) is renumbered
  151  as subsection (4), present subsection (4) is renumbered as
  152  subsection (5) and amended, and a new subsection (3) is added to
  153  that section, to read:
  154         560.111 Prohibited acts.—
  155         (1) A money services business, authorized vendor, or
  156  affiliated party may not:
  157         (g) Knowingly possess any fraudulent identification
  158  paraphernalia. This paragraph does not prohibit the maintenance
  159  and retention of any records required by this chapter.
  160         (3) A person other than the conductor of a payment
  161  instrument may not provide a licensee engaged in cashing the
  162  payment instrument with the customer’s personal identification
  163  information.
  164         (5)(4) Any person who willfully violates any provision of
  165  s. 560.311(1), s. 560.403, s. 560.404, or s. 560.405 commits a
  166  felony of the third degree, punishable as provided in s.
  167  775.082, s. 775.083, or s. 775.084.
  168         Section 4. Paragraph (h) of subsection (1) of section
  169  560.114, Florida Statutes, is reenacted, paragraphs (aa), (bb),
  170  and (cc) are added to that subsection, and subsection (2) of
  171  that section is amended, to read:
  172         560.114 Disciplinary actions; penalties.—
  173         (1) The following actions by a money services business,
  174  authorized vendor, or affiliated party constitute grounds for
  175  the issuance of a cease and desist order; the issuance of a
  176  removal order; the denial, suspension, or revocation of a
  177  license; or taking any other action within the authority of the
  178  office pursuant to this chapter:
  179         (h) Engaging in an act prohibited under s. 560.111.
  180         (aa) Failure of a check casher to maintain a federally
  181  insured depository account as required by s. 560.309.
  182         (bb) Failure of a check casher to deposit into its own
  183  federally insured depository account any payment instrument
  184  cashed as required by s. 560.309.
  185         (cc) Failure to submit transaction information to the
  186  office as required by s. 560.311 for any payment instrument
  187  cashed.
  188         (2) The office may immediately suspend the license of any
  189  money services business if the money services business fails to:
  190         (a) Provide to the office, upon written request, any of the
  191  records required by s. ss. 560.123, s. 560.1235, s. 560.211, or
  192  s. and 560.310 or any rule adopted under those sections. The
  193  suspension may be rescinded if the licensee submits the
  194  requested records to the office.
  195         (b) Maintain a federally insured depository account as
  196  required by s. 560.309.
  197         (c) Submit transaction information to the office as
  198  required by s. 560.311 for any payment instrument cashed.
  199  
  200  For purposes of s. 120.60(6), failure to perform provide any of
  201  the acts specified in this subsection above-mentioned records
  202  constitutes immediate and serious danger to the public health,
  203  safety, and welfare.
  204         Section 5. Subsection (4) is added to section 560.126,
  205  Florida Statutes, to read:
  206         560.126 Required notice by licensee.—
  207         (4) A licensee that engages in check cashing must notify
  208  the office within 5 business days after the licensee ceases to
  209  maintain a federally insured depository account as required by
  210  s. 560.309(3) and, before resuming check cashing, must
  211  reestablish such an account and notify the office of the
  212  account.
  213         Section 6. Subsections (3), (4), and (8) of section
  214  560.309, Florida Statutes, are amended to read:
  215         560.309 Conduct of business.—
  216         (3) A licensee under this part must maintain and deposit
  217  payment instruments into its own a commercial account at a
  218  federally insured financial institution. If a licensee ceases to
  219  maintain such a depository account, the licensee must not engage
  220  in check cashing until the licensee reestablishes such an
  221  account and notifies the office of the account as required by s.
  222  560.126(4) or sell payment instruments within 5 business days
  223  after the acceptance of the payment instrument.
  224         (4) A licensee may not accept or cash a multiple payment
  225  instrument instruments from a conductor person who is not the
  226  original payee, unless the person is licensed to cash payment
  227  instruments pursuant to this part and all payment instruments
  228  accepted are endorsed with the legal name of the person.
  229  However, this subsection does not prohibit a licensee from
  230  accepting or cashing a corporate payment instrument from a
  231  conductor who is an authorized officer of the corporate payee
  232  named on the instrument’s face.
  233         (8) Exclusive of the direct costs of verification, which
  234  shall be established by rule not to exceed $5, a check casher
  235  may not:
  236         (a) Charge fees, except as otherwise provided by this part,
  237  in excess of 5 percent of the face amount of the payment
  238  instrument, or $5, whichever is greater;
  239         (b) Charge fees in excess of 3 percent of the face amount
  240  of the payment instrument, or $5, whichever is greater, if such
  241  payment instrument is the payment of any kind of state public
  242  assistance or federal social security benefit payable to the
  243  bearer of the payment instrument; or
  244         (c) Charge fees for personal checks or money orders in
  245  excess of 10 percent of the face amount of those payment
  246  instruments, or $5, whichever is greater.
  247         Section 7. Section 560.310, Florida Statutes, is amended to
  248  read:
  249         560.310 Records of check cashers and foreign currency
  250  exchangers.—
  251         (1) In addition to the record retention requirements
  252  specified in s. 560.1105, A licensee engaged in check cashing
  253  must maintain for the period specified in s. 560.1105 a copy of
  254  each payment instrument cashed.
  255         (2) If the payment instrument exceeds $1,000, the following
  256  additional information must be maintained the following:
  257         (a) Customer files, as prescribed by rule, on all customers
  258  who cash corporate or third-party payment instruments that
  259  exceed exceeding $1,000.
  260         (b) For any payment instrument accepted having a face value
  261  of $1,000 or more:
  262         1. A copy of the personal identification that bears a
  263  photograph of the customer used as identification and presented
  264  by the customer. Acceptable personal identification is limited
  265  to a valid driver driver’s license; a state identification card
  266  issued by any state of the United States or its territories or
  267  the District of Columbia, and showing a photograph and
  268  signature; a United States Government Resident Alien
  269  Identification Card; a passport; or a United States Military
  270  identification card.
  271         (c)2. A thumbprint of the customer taken by the licensee
  272  when the payment instrument is presented for negotiation or
  273  payment.
  274         (c) A payment instrument log that must be maintained
  275  electronically as prescribed by rule. For purposes of this
  276  paragraph, multiple payment instruments accepted from any one
  277  person on any given day which total $1,000 or more must be
  278  aggregated and reported on the log.
  279         (3)(2) A licensee under this part may engage the services
  280  of a third party that is not a depository institution for the
  281  maintenance and storage of records required by this section if
  282  all the requirements of this section are met.
  283         Section 8. Effective July 1, 2013, section 560.311, Florida
  284  Statutes, is created to read:
  285         560.311 Reporting of payment instruments cashed; database
  286  of payment instrument transactions.—
  287         (1) A licensee that cashes a payment instrument that
  288  exceeds $1,000 must submit the following transaction information
  289  about the payment instrument to the office within the time and
  290  in the format and manner prescribed by commission rule:
  291         (a) Transaction date.
  292         (b) Payor name.
  293         (c) Payee name.
  294         (d) Conductor name, if different from the payee name.
  295         (e) Amount of the payment instrument.
  296         (f) Amount of the currency provided.
  297         (g) Type of payment instrument, which may include, as
  298  prescribed by commission rule, but is not limited to, a personal
  299  check, payroll check, government check, corporate check, or
  300  third-party check.
  301         (h) Location or branch where the payment instrument is
  302  accepted.
  303         (i) Payee’s workers’ compensation policy number, if the
  304  payment instrument is a corporate payment instrument.
  305         (j) Any other transaction information that may be required
  306  by commission rule.
  307  
  308  Multiple payment instruments accepted from any one conductor on
  309  any given day that exceeds $1,000 must be aggregated and
  310  reported to the office through the payment instrument database.
  311         (2)(a) The office shall establish and administer a
  312  centralized database that maintains and provides real-time
  313  access to the transaction information submitted to the office
  314  under subsection (1). The commission may require licensees to
  315  submit the transaction information through the Internet or by
  316  other electronic means that provide for inclusion of the
  317  submitted information in the database.
  318         (b) The office shall design and administer the database to
  319  interface with other government databases, including, but not
  320  limited to:
  321         1. The department’s workers’ compensation proof of coverage
  322  database.
  323         2. The Department of State’s database of corporations,
  324  partnerships, limited liability companies, corporations not for
  325  profit, trusts, associations, cooperatives, and other business
  326  organizations registered with the Department of State.
  327         (3) The commission shall adopt rules requiring a licensee
  328  to remit to the office a transaction fee, as part of the direct
  329  costs of verification authorized under s. 560.309(8), not to
  330  exceed $3 per transaction submitted under subsection (1)to
  331  establish and administer the database required by this section.
  332         (4) The commission may adopt rules to administer this
  333  section, including, but not limited to, rules governing the
  334  operation and security of the database.
  335         Section 9. Except as otherwise expressly provided in this
  336  act, this act shall take effect July 1, 2012.