State Codes and Statutes

State Codes and Statutes

Statutes > California > Fin > 1800-1803

FINANCIAL CODE
SECTION 1800-1803



1800.  This chapter shall be known and may be cited as the Money
Transmission Act.



1801.  The Legislature finds and declares all of the following:
   (a) Money transmission businesses conduct a significant amount of
business in this state and technological advances are occurring in
the provision of money transmission services.
   (b) Persons who use money transmission businesses in this state
use those businesses for, among other purposes, paying for the
necessities of life and transmitting money to family members.
   (c) The failure of money transmission businesses to fulfill their
obligations would cause loss to consumers, disrupt the payments
mechanism in this state, undermine public confidence in financial
institutions doing business in this state, and adversely affect the
health, safety, and general welfare of persons in this state.
   (d) To protect the interests of consumers of money transmission
businesses in this state, to maintain public confidence in financial
institutions doing business in this state, and to preserve the
health, safety, and general welfare of the people of this state, it
is necessary to regulate money transmission businesses in this state.



1802.  It is the intent of the Legislature that the provisions of
this act accomplish all of the following:
   (a) Protect the interests of persons in this state who use money
transmission services.
   (b) Provide for the safe and sound conduct of the business of
licensees.
   (c) Maintain public confidence in licensees.




1803.  For purposes of this chapter, the following definitions shall
apply:
   (a) "Affiliate," when used with respect to a specified person,
means any person controlling, controlled by, or under common control
with, that specified person, directly or indirectly through one or
more intermediaries. For purposes of subdivisions (q) and (v), a
specified person is affiliated with another person if that person
controls, is controlled by, or under common control through the
ownership directly or indirectly of shares or equity securities
possessing more than 50 percent of the voting power of that specified
person.
   (b) "Agent" means a person that provides money transmission in
California on behalf of the licensee, provided that the licensee
becomes liable for the money transmission from the time money or
monetary value is received by that person. However, "agent" does not
include any officer or employee of the licensee when acting as such
at an office of a licensee.
   (c) "Applicant" means a person that files an application for a
license or for acquisition of control of a licensee under this
chapter.
   (d) "Average daily outstanding" means the amount of outstanding
money transmission obligations in California at the end of each day
in a given period of time, added together, and divided by the total
number of days in that period of time.
   (e)  "Branch office" means any office in this state of a licensee
or agent at which the licensee receives money or monetary value to
provide money transmission, either directly or through an agent.
   (f) "Business day" means one of the following:
   (1) When used with respect to any act to be performed in this
state, any day other than Saturday, Sunday, or any other day that is
provided for as a holiday in the Government Code.
   (2) When used with respect to any act to be performed in any
jurisdiction other than this state, any day other than a day that is
a legal holiday under the laws of that jurisdiction.
   (g) "Commissioner" means the Commissioner of Financial
Institutions.
   (h) "Control" has the meaning set forth in Section 700.
   (i) "Day" means calendar day.
   (j) "In California" or "in this state" means physically located in
California, or with, to, or from persons located in California.
   (k) "Issue" and "issuer" mean, with regard to a payment
instrument, the entity that is the maker or drawer of the instrument
in accordance with the California Commercial Code and is liable for
payment. With regard to stored value, "issue" and "issuer" mean the
entity that is liable to the holder of stored value and has
undertaken or is obligated to pay the stored value. Only a licensee
may issue stored value or payment instruments.
   (l) "Licensee" means a corporation or limited liability company
licensed under this chapter.
   (m) "Monetary value" means a medium of exchange, whether or not
redeemable in money.
   (n) "Money" means a medium of exchange that is authorized or
adopted by the United States or a foreign government. The term
includes a monetary unit of account established by an
intergovernmental organization or by agreement between two or more
governments.
   (o) "Money transmission" means any of the following:
   (1) Selling or issuing payment instruments.
   (2) Selling or issuing stored value.
   (3) Receiving money for transmission.
   (p) "Outstanding," with respect to payment instruments and stored
value, means issued or sold by the licensee in the United States and
not yet paid or refunded by the licensee, or issued or sold on behalf
of the licensee in the United States by its agent and reported as
sold, but not yet paid or refunded by the licensee. "Outstanding,"
with respect to receiving money for transmission means all money or
monetary value received in the United States for transmission by the
licensee or its agents but not yet paid to the beneficiaries or
refunded to the person from whom the money or monetary value was
received. All outstanding money transmission of a licensee is and
shall remain a liability of the licensee until it is no longer
outstanding.
   (q) "Payment instrument" means a check, draft, money order,
traveler's check, or other instrument for the transmission or payment
of money or monetary value, whether or not negotiable. The term does
not include a credit card voucher, letter of credit, or any
instrument that is redeemable by the issuer for goods or services
provided by the issuer or its affiliate.
   (r) "Person" means an individual, corporation, business trust,
estate, trust, partnership, proprietorship, syndicate, limited
liability company, association, joint venture, government,
governmental subdivision, agency or instrumentality, public
corporation or joint stock company, or any other organization or
legal or commercial entity, provided, however, that "person," when
used with respect to acquiring control of or controlling a specified
person, includes any combination of two or more persons acting in
concert.
   (s) "Receiving money for transmission" or "money received for
transmission" means receiving money or monetary value in the United
States for transmission within or outside the United States by
electronic or other means. The term does not include sale or issuance
of payment instruments and stored value.
   (t) "Record" means information that is inscribed on a tangible
medium or that is stored in an electronic or other medium and is
retrievable in perceivable form.
   (u) "State" means a state of the United States, the District of
Columbia, Puerto Rico, the United States Virgin Islands, or any
territory or insular possession subject to the jurisdiction of the
United States.
   (v) "Stored value" means monetary value representing a claim
against the issuer that is stored on an electronic or digital medium
and evidenced by an electronic or digital record, and that is
intended and accepted for use as a means of redemption for money or
monetary value or payment for goods or services. The term does not
include a credit card voucher, letter of credit, or any stored value
that is only redeemable by the issuer for goods or services provided
by the issuer or its affiliate, except to the extent required by
applicable law to be redeemable in cash for its cash value.
   (w) "Traveler's check" means an instrument that meets all of the
following:
   (1) Is designated on its face by the term "traveler's check" or by
any substantially similar term or is commonly known and marketed as
a traveler's check.
   (2) Contains a provision for a specimen signature of the purchaser
to be completed at the time of purchase.
   (3) Contains a provision for a countersignature of the purchaser
to be completed at the time of negotiation.