093_SB0024enr SB24 Enrolled LRB093 02172 JLS 03494 b 1 AN ACT concerning transmitters of money. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The Transmitters of Money Act is amended by 5 changing Sections 5, 65, and 90 and adding Sections 37 and 93 6 as follows: 7 (205 ILCS 657/5) 8 Sec. 5. Definitions. As used in this Act, unless the 9 context otherwise requires, the words and phrases defined in 10 this Section have the meanings set forth in this Section. 11 "Authorized seller" means a person not an employee of a 12 licensee who engages in the business regulated by this Act on 13 behalf of a licensee under a contract between that person and 14 the licensee. 15 "Bill payment service" means the business of transmitting 16 money on behalf of an Illinois resident for the purpose of 17 paying the resident's bills. 18 "Controlling person" means a person owning or holding the 19 power to vote 25% or more of the outstanding voting 20 securities of a licensee or the power to vote the securities 21 of another controlling person of the licensee. For purposes 22 of determining the percentage of a licensee controlled by a 23 controlling person, the person's interest shall be combined 24 with the interest of any other person controlled, directly or 25 indirectly, by that person or by a spouse, parent, or child 26 of that person. 27 "Department" means the Department of Financial 28 Institutions. 29 "Director" means the Director of Financial Institutions. 30 "Licensee" means a person licensed under this Act. 31 "Location" means a place of business at which activity SB24 Enrolled -2- LRB093 02172 JLS 03494 b 1 regulated by this Act occurs. 2 "Material litigation" means any litigation that, 3 according to generally accepted accounting principles, is 4 deemed significant to a licensee's financial health and would 5 be required to be referenced in a licensee's annual audited 6 financial statements, reports to shareholders, or similar 7 documents. 8 "Money" means a medium of exchange that is authorized or 9 adopted by a domestic or foreign government as a part of its 10 currency and that is customarily used and accepted as a 11 medium of exchange in the country of issuance. 12 "Money transmitter" means a person who is located in or 13 doing business in this State and who directly or through 14 authorized sellers does any of the following in this State: 15 (1) Sells or issues payment instruments. 16 (2) Engages in the business of receiving money for 17 transmission or transmitting money. 18 (3) Engages in the business of exchanging, for 19 compensation, money of the United States Government or a 20 foreign government to or from money of another 21 government. 22 "Outstanding payment instrument" means, unless otherwise 23 treated by or accounted for under generally accepted 24 accounting principles on the books of the licensee, a payment 25 instrument issued by the licensee that has been sold in the 26 United States directly by the licensee or has been sold in 27 the United States by an authorized seller of the licensee and 28 reported to the licensee as having been sold, but has not 29 been paid by or for the licensee. 30 "Payment instrument" means a check, draft, money order, 31 traveler's check, stored value card, or other instrument or 32 memorandum, written order or written receipt for the 33 transmission or payment of money sold or issued to one or 34 more persons whether or not that instrument or order is SB24 Enrolled -3- LRB093 02172 JLS 03494 b 1 negotiable. Payment instrument does not include an 2 instrument that is redeemable by the issuer in merchandise or 3 service, a credit card voucher, or a letter of credit. A 4 written order for the transmission or payment of money that 5 results in the issuance of a check, draft, money order, 6 traveler's check, or other instrument or memorandum is not a 7 payment instrument. 8 "Person" means an individual, partnership, association, 9 joint stock association, corporation, or any other form of 10 business organization. 11 "Stored value card" means any magnetic stripe card or 12 other electronic payment instrument given in exchange for 13 money and other similar consideration, including but not 14 limited to checks, debit payments, money orders, drafts, 15 credit payments, and traveler's checks, where the card or 16 other electronic payment instrument represents a dollar value 17 that the consumer can either use or give to another 18 individual. 19 "Transmitting money" means the transmission of money by 20 any means, including transmissions to or from locations 21 within the United States or to and from locations outside of 22 the United States by payment instrument, facsimile or 23 electronic transfer, or otherwise, and includes bill payment 24 services. 25 (Source: P.A. 92-400, eff. 1-1-02.) 26 (205 ILCS 657/37 new) 27 Sec. 37. Display of disclosure notice. 28 (a) Each authorized seller shall conspicuously display a 29 disclosure notice supplied by the licensee; each licensee 30 that transmits money directly shall also conspicuously 31 display a disclosure notice. 32 (b) The disclosure notice shall contain the following 33 information: SB24 Enrolled -4- LRB093 02172 JLS 03494 b 1 (1) In the case of an authorized seller only, the 2 name of the authorized seller's licensee issuing the 3 disclosure notice. 4 (2) A toll-free telephone number for the Department 5 of Financial Institutions which will provide customer 6 support for suspected violations of this Act. 7 (3) A statement that the authorization may be 8 revoked at any time by the licensee. 9 (c) A licensee shall notify the Department within 30 10 days when an authorized seller is no longer an authorized 11 seller for the licensee. An authorized seller who has been 12 terminated shall remove the disclosure notice from the 13 premises within 10 business days after such termination. A 14 terminated authorized seller who wilfully and knowingly 15 refuses to remove the disclosure notice within 10 business 16 days of termination commits a Class B misdemeanor. 17 (d) If a customer of a former authorized seller 18 detrimentally relies on a disclosure notice that was not 19 removed, the former authorized seller shall be civilly liable 20 if the customer proves: (1) that the entity possessed the 21 disclosure notice beyond 10 business days from the 22 termination of authorization by the licensee, (2) that the 23 entity held itself out as an authorized seller, without 24 informing the customer that the seller was no longer 25 authorized by the licensee, (3) that the customer justifiably 26 relied upon the conspicuously displayed disclosure notice 27 formerly provided by the licensee, and (4) that the entity 28 engaged in the business of transmitting money after its 29 termination as an authorized seller. 30 (e) As used in this Section, "civil liability" means 31 liability for actual loss, reasonable attorney's fees, and 32 costs. 33 (205 ILCS 657/65) SB24 Enrolled -5- LRB093 02172 JLS 03494 b 1 Sec. 65. Notice of source of instrument; transaction 2 records. 3 (a) Every payment instrument other than a stored value 4 card sold through an authorized seller shall bear the name of 5 the licensee and a unique consecutive number clearly stamped 6 or imprinted on it. When an order for the transmission of 7 money results in the issuance of a payment instrument, both 8 the order and the payment instrument may bear the same unique 9 number. 10 (b) A licensee or authorized seller shall create a 11 record, which may be reduced to computer or other electronic 12 medium, upon receiving any money from a customer. 13 (c) For each payment instrument other than a stored 14 value card sold, the licensee shall require the authorized 15 seller to record the face amount of the payment instrument 16 and the serial number of the payment instrument. 17 (d) For each transmission of money, the licensee or 18 authorized seller shall record the date the money was 19 received, the face amount of the payment instrument, the name 20 of the customer, the manner of transmission, including the 21 identity and location of any bank or other financial 22 institution receiving or otherwise involved in accomplishing 23 the transmission, the location to which the money is 24 transmitted if different from the bank or other financial 25 institution required to be recorded, the name of the intended 26 recipient, and the date the transmission was accomplished or 27 the money was refunded to the customer due to an inability to 28 transmit or failure of the intended recipient to receive or 29 obtain the money transmitted. The transmission shall be made 30 by the licensee or authorized seller within 3 business days 31 after the receipt of the money to be transmitted. The 32 licensee or authorized seller, in addition to the records 33 required to be kept, shall issue a receipt to each person 34 delivering or depositing money with the licensee or SB24 Enrolled -6- LRB093 02172 JLS 03494 b 1 authorized seller indicating the date of the transaction, the 2 face amount of the payment instrument, to whom the money is 3 to be transmitted, the service charge, and the name and 4 address of the licensee or authorized seller. The receipt or 5 a separate disclosure at the time of the money transmission 6 shall also include a statement of the licensee's refund 7 procedures as well as a toll-free telephone number for 8 customer assistance. An inadvertent or non-wilful failure to 9 give a consumer the disclosure provided for in this Section 10 shall not constitute a violation of this Act. The licensee or 11 authorized seller shall keep a copy of every receipt in a 12 permanent record book or maintain the data embodied in the 13 receipt using photographic, electronic, or other means. 14 (e) For each exchange of money of the United States 15 government or a foreign government to or from money of 16 another government, the licensee or authorized seller shall 17 record the date of the transaction, the amount of the 18 transaction, the amount of funds stated in currency received 19 by the recipient, and the rate of exchange at the time of the 20 transaction. The licensee or authorized seller, in addition 21 to the records required to be kept, shall issue a receipt to 22 each person delivering or depositing money with the licensee 23 or authorized seller indicating the date of the transaction, 24 the amount of the transaction, the service charge, and the 25 name and address of the licensee or authorized seller making 26 the transaction. The licensee or authorized seller shall 27 keep a copy of every receipt in a permanent record book or 28 maintain data embodied in the receipt using photographic, 29 electronic, or other means. 30 (f) Records required to be kept by the licensee or 31 authorized seller under this Act shall be preserved for at 32 least 5 years or as required to comply with any other Act the 33 administration of which is vested in the Director. The 34 records shall be made available for examination in accordance SB24 Enrolled -7- LRB093 02172 JLS 03494 b 1 with Sections 55 and 60 of this Act. 2 (Source: P.A. 88-643, eff. 1-1-95.) 3 (205 ILCS 657/90) 4 Sec. 90. Enforcement. 5 (a) If it appears to the Director that a person has 6 committed or is about to commit a violation of this Act, a 7 rule promulgated under this Act, or an order of the Director, 8 the Director may apply to the circuit court for an order 9 enjoining the person from violating or continuing to violate 10 this Act, the rule, or order and for injunctive or other 11 relief that the nature of the case may require and may, in 12 addition, request the court to assess a civil penalty up to 13 $1,000 along with costs and attorney fees. 14 (b) If the Director finds, after an investigation that 15 he considers appropriate, that a licensee or other person is 16 engaged in practices contrary to this Act or to the rules 17 promulgated under this Act, the Director may issue an order 18 directing the licensee or person to cease and desist the 19 violation. The Director may, in addition to or without the 20 issuance of a cease and desist order, assess an 21 administrative penalty up to $1,000 against a licensee for 22 each violation of this Act or the rules promulgated under 23 this Act. The issuance of an order under this Section shall 24 not be a prerequisite to the taking of any action by the 25 Director under this or any other Section of this Act. The 26 Director shall serve notice of his action, including a 27 statement of the reasons for his actions, either personally 28 or by certified mail, return receipt requested. Service by 29 mail shall be deemed completed if the notice is deposited in 30 the post office, postage paid, addressed to the last known 31 address for a license. 32 (c) In the case of the issuance of a cease and desist 33 order or assessment order, a hearing may be requested in SB24 Enrolled -8- LRB093 02172 JLS 03494 b 1 writing within 30 days after the date of service. The 2 hearing shall be held at the time and place designated by the 3 Director in either the City of Springfield or the City of 4 Chicago. The Director and any administrative law judge 5 designated by him shall have the power to administer oaths 6 and affirmations, subpoena witnesses and compel their 7 attendance, take evidence, authorize the taking of 8 depositions, and require the production of books, papers, 9 correspondence, and other records or information that he 10 considers relevant or material to the inquiry. 11 (d) After the Director's final determination under a 12 hearing under this Section, a party to the proceedings whose 13 interests are affected by the Director's final determination 14 shall be entitled to judicial review of that final 15 determination under the Administrative Review Law. 16 (e) The costs for administrative hearings shall be set 17 by rule. 18 (f) Except as otherwise provided in this Act, a 19 violation of this Act shall subject to the party violating it 20 to a fine of $1,000 for each offense. 21 (g) Each transaction in violation of this Act or the 22 rules promulgated under this Act and each day that a 23 violation continues shall be a separate offense. 24 (h) A person who engages in conduct requiring a license 25 under this Act and fails to obtain a license from the 26 Director or knowingly makes a false statement, 27 misrepresentation, or false certification in an application, 28 financial statement, account record, report, or other 29 document filed or required to be maintained or filed under 30 this Act or who knowingly makes a false entry or omits a 31 material entry in a document is guilty of a Class 3 felony. 32 (i) The Director is authorized to compromise, settle, 33 and collect civil penalties and administrative penalties, as 34 set by rule, with any person for violations of this Act or of SB24 Enrolled -9- LRB093 02172 JLS 03494 b 1 any rule or order issued or promulgated under this Act. Any 2 person who, without the required license, engages in conduct 3 requiring a license under this Act shall be liable to the 4 Department in an amount equal to the greater of (i) $5,000 or 5 (ii) an amount of money accepted for transmission plus an 6 amount equal to 3 times the amount accepted for transmission. 7 The Department shall cause any funds so recovered to be 8 deposited in the TOMA Consumer Protection Fund. 9 (j) The Director may enter into consent orders at any 10 time with a person to resolve a matter arising under this 11 Act. A consent order must be signed by the person to whom it 12 is issued and must indicate agreement to the terms contained 13 in it. A consent order need not constitute an admission by a 14 person that this Act or a rule or order issued or promulgated 15 under this Act has been violated, nor need it constitute a 16 finding by the Director that the person has violated this Act 17 or a rule or order promulgated under this Act. 18 (k) Notwithstanding the issuance of a consent order, the 19 Director may seek civil or criminal penalties or compromise 20 civil penalties concerning matter encompassed by the consent 21 order unless the consent order by its terms expressly 22 precludes the Director from doing so. 23 (l) Appeals from all final orders and judgments entered 24 by the circuit court under this Section in review of a 25 decision of the Director may be taken as in other civil 26 actions by any party to the proceeding. 27 (Source: P.A. 88-643, eff. 1-1-95; 89-601, eff. 8-2-96.) 28 (205 ILCS 657/93 new) 29 Sec. 93. Consumer Protection Fund. 30 (a) A special income-earning fund is hereby created in 31 the State treasury, known as the TOMA Consumer Protection 32 Fund. 33 (b) All moneys paid into the fund together with all SB24 Enrolled -10- LRB093 02172 JLS 03494 b 1 accumulated undistributed income thereon shall be held as a 2 special fund in the State treasury. The fund shall be used 3 solely for the purpose of providing restitution to consumers 4 who have suffered monetary loss arising out of a transaction 5 regulated by this Act. 6 (c) The fund shall be applied only to restitution when 7 restitution has been ordered by the Director. Restitution 8 shall not exceed the amount actually lost by the consumer. 9 The fund shall not be used for the payment of any attorney or 10 other fees. 11 (d) The fund shall be subrogated to the amount of the 12 restitution, and the Director shall request the Attorney 13 General to engage in all reasonable collection steps to 14 collect restitution from the party responsible for the loss 15 and reimburse the fund. 16 (e) Notwithstanding any other provisions of this 17 Section, the payment of restitution from the fund shall be a 18 matter of grace and not of right, and no consumer shall have 19 any vested rights in the fund as a beneficiary or otherwise. 20 Before seeking restitution from the fund, the consumer or 21 beneficiary seeking payment of restitution shall apply for 22 restitution on a form provided by the Director. The form 23 shall include any information the Director may reasonably 24 require in order to determine that restitution is 25 appropriate. 26 Section 95. The State Finance Act is amended by adding 27 Section 5.595 as follows: 28 (30 ILCS 105/5.595 new) 29 Sec. 5.595. The TOMA Consumer Protection Fund.