§ 2525. Relationship between licensee and authorized delegate
(a) As used in this subchapter, “remit” means to make direct payments of money to a licensee
or its representative authorized to receive the money, or to deposit the money in
an entity identified as exempt under subdivision 2504(7) of this chapter, in an account
specified by the licensee.
(b) Before a licensee is authorized to conduct business through an authorized delegate
or allows a person to act as the licensee’s authorized delegate, the licensee shall:
(1) adopt, and update as necessary, written policies and procedures reasonably designed
to ensure that the licensee’s authorized delegates comply with applicable state and
federal law;
(2) enter into a written contract that complies with subsection (d) of this section; and
(3) conduct a reasonable risk-based background investigation sufficient for the licensee
to determine whether the authorized delegate has complied and will likely comply with
applicable state and federal law.
(c) An authorized delegate must operate in full compliance with this chapter.
(d) The written contract required by subsection (b) of this section must be signed by
the licensee and the authorized delegate and, at a minimum, shall:
(1) appoint the person signing the contract as the licensee’s authorized delegate with
the authority to conduct money transmission on behalf of the licensee;
(2) set forth the nature and scope of the relationship between the licensee and the authorized
delegate and the respective rights and responsibilities of the parties;
(3) require the authorized delegate to agree to fully comply with all applicable state
and federal laws, rules, and regulations pertaining to money transmission, including
this chapter and rules implementing this chapter, relevant provisions of the Bank
Secrecy Act and the USA PATRIOT Act;
(4) require the authorized delegate to remit and handle money and monetary value in accordance
with the terms of the contract between the licensee and the authorized delegate;
(5) impose a trust on money and monetary value net of fees received for money transmission
for the benefit of the licensee;
(6) require the authorized delegate to prepare and maintain records as required by this
chapter or rules implementing this chapter, or as reasonably requested by the Commissioner;
(7) acknowledge that the authorized delegate consents to examination or investigation
by the Commissioner;
(8) state that the licensee is subject to regulation by the Commissioner and that, as
part of that regulation, the Commissioner may suspend or revoke an authorized delegate
designation or require the licensee to terminate an authorized delegate designation;
and
(9) acknowledge receipt of the written policies and procedures required under subsection
(b) of this section.
(e) If the licensee’s license is suspended, revoked, terminated, nonrenewed, surrendered
or expired, the licensee must, within five business days, provide documentation to
the Commissioner that the licensee has notified all applicable authorized delegates
of the licensee whose names are in a record filed with the Commissioner of the suspension,
revocation, termination, nonrenewal, surrender, or expiration of a license. Upon suspension,
revocation, termination, nonrenewal, or surrender of a license, applicable authorized
delegates shall immediately cease to provide money transmission as an authorized delegate
of the licensee.
(f) An authorized delegate of a licensee holds in trust for the benefit of the licensee
all money net of fees received from money transmission. If any authorized delegate
commingles any funds received from money transmission with any other funds or property
owned or controlled by the authorized delegate, all commingled funds and other property
shall be considered held in trust in favor of the licensee in an amount equal to the
amount of money net of fees received from money transmission.
(g) An authorized delegate shall not use a subdelegate to conduct money transmission on
behalf of a licensee. (Added 2001, No. 55, § 1, eff. Jan. 1, 2002; amended 2009, No. 134 (Adj. Sess.), § 22; 2023, No. 110 (Adj. Sess.), § 42, eff. July 1, 2024.)