Sec. 407. UNIFORM STATE LICENSING AND REGULATION OF CHECK CASHING, CURRENCY EXCHANGE, AND MONEY TRANSMITTING BUSINESSES
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## SEC. 407 UNIFORM STATE LICENSING AND REGULATION OF CHECK CASHING, CURRENCY EXCHANGE, AND MONEY TRANSMITTING BUSINESSES **[**[31 U.S.C. 5311](/us/usc/t31/s5311) nt**]** ###
(a)Uniform Laws and Enforcement For purposes of preventing money laundering and protecting the payment system from fraud and abuse, it is the sense of the Congress that the several States should— ####
(1)establish uniform laws for licensing and regulating businesses which— #####
(A)provide check cashing, currency exchange, or money transmitting or remittance services, or issue or redeem money orders, travelers' checks, and other similar instruments; and #####
(B)are not depository institutions (as defined in section 5313(g) of title 31, United States Code); and ####
(2)provide sufficient resources to the appropriate State agency to enforce such laws and regulations prescribed pursuant to such laws. ###
(b)Model Statute It is the sense of the Congress that the several States should develop, through the auspices of the National Conference of Commissioners on Uniform State Laws, the American Law Institute, or such other forum as the States may determine to be appropriate, a model statute to carry out the goals described in subsection
(a)which would include the following: ####
(1)Licensing requirements A requirement that any business described in subsection (a)(1) be licensed and regulated by an appropriate State agency in order to engage in any such activity within the State. ####
(2)Licensing standards A requirement that— #####
(A)in order for any business described in subsection (a)(1) to be licensed in the State, the appropriate State agency shall review and approve— ######
(i)the business record and the capital adequacy of the business seeking the license; and ######
(ii)the competence, experience, integrity, and financial ability of any individual who— ######
(I)is a director, officer, or supervisory employee of such business; or ######
(II)owns or controls such business; and #####
(B)any record, on the part of any business seeking the license or any person referred to in subparagraph (A)(ii), of— ######
(i)any criminal activity; ######
(ii)any fraud or other act of personal dishonesty; ######
(iii)any act, omission, or practice which constitutes a breach of a fiduciary duty; or ######
(iv)any suspension or removal, by any agency or department of the United States or any State, from participation in the conduct of any federally or State licensed or regulated business, may be grounds for the denial of any such license by the appropriate State agency. ####
(3)Reporting requirements A requirement that any business described in subsection (a)(1)— #####
(A)disclose to the appropriate State agency the fees charged to consumers for services described in subsection (a)(1)(A); and #####
(B)conspicuously disclose to the public, at each location of such business, the fees charged to consumers for such services. ####
(4)Procedures to ensure compliance with federal cash transaction reporting requirements A civil or criminal penalty for operating any business referred to in paragraph
(1)without establishing and complying with appropriate procedures to ensure compliance with subchapter II of chapter 53 of title 31, United States Code (relating to records and reports on monetary instruments transactions). ####
(5)Criminal penalties for operation of business without a license A criminal penalty for operating any business referred to in paragraph
(1)without a license within the State after the end of an appropriate transition period beginning on the date of enactment of such model statute by the State. ###
(c)Study Required The Secretary of the Treasury shall conduct a study of— ####
(1)the progress made by the several States in developing and enacting a model statute which— #####
(A)meets the requirements of subsection (b); and #####
(B)furthers the goals of— ######
(i)preventing money laundering by businesses which are required to be licensed under any such statute; and ######
(ii)protecting the payment system, including the receipt, payment, collection, and clearing of checks, from fraud and abuse by such businesses; and ####
(2)the adequacy of— #####
(A)the activity of the several States in enforcing the requirements of such statute; and #####
(B)the resources made available to the appropriate State agencies for such enforcement activity. ###
(d)Report Required Not later than the end of the 3-year period beginning on the date of enactment of this Act and not later than the end of each of the first two 1-year periods beginning after the end of such 3-year period, the Secretary of the Treasury shall submit a report to the Congress containing the findings and recommendations of the Secretary in connection with the study under subsection (c), together with such recommendations for legislative and administrative action as the Secretary may determine to be appropriate. ###
(e)Recommendations in Cases of Inadequate Regulation and Enforcement by States If the Secretary of the Treasury determines that any State has been unable to— ####
(1)enact a statute which meets the requirements described in subsection (b); ####
(2)undertake adequate activity to enforce such statute; or ####
(3)make adequate resources available to the appropriate State agency for such enforcement activity, the report submitted pursuant to subsection
(d)shall contain recommendations of the Secretary which are designed to facilitate the enactment and enforcement by the State of such a statute. ###
(f)Federal Funding Study ####
(1)Study required The Secretary of the Treasury shall conduct a study to identify possible available sources of Federal funding to cover costs which will be incurred by the States in carrying out the purposes of this section. ####
(2)Report The Secretary of the Treasury shall submit a report to the Congress on the study conducted pursuant to paragraph
(1)not later than the end of the 18-month period beginning on the date of enactment of this Act.
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Sec. 407
UNIFORM STATE LICENSING AND REGULATION OF CHECK CASHING, CURRENCY EXCHANGE, AND MONEY TRANSMITTING BUSINESSES
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