1830. (a) A licensee shall at all times own eligible securities
having an aggregate market value computed in accordance with United
States generally accepted accounting principles of not less than the
aggregate amount of all of its outstanding payment instruments and
stored value obligations issued or sold in the United States and all
outstanding money received for transmission in the United States.
(b) If the commissioner finds that the financial condition of a
licensee is impaired, or that the financial condition of a licensee
is such that its business is being conducted in an unsafe and unsound
manner, the commissioner, to protect the public interest, may issue
an order, subject to the procedures set forth in Section 1864, doing
one or both of the following:
(1) Increasing the amount of eligible securities that the licensee
must maintain.
(2) Requiring the licensee to obtain, as security for the payment
of outstanding money transmission obligations, additional security in
the form of financial guarantees.
(c) Eligible securities, even if commingled with other assets of
the licensee, are deemed to be held in trust for the benefit of the
purchasers and holders of the licensee's outstanding payment
instrument and stored value obligations, and all senders of
outstanding money received for transmission, in the event of
bankruptcy or receivership of the licensee, or in the event of an
action by a creditor against the licensee who is not a beneficiary of
this statutory trust. No eligible securities impressed with a trust
pursuant to this subdivision shall be subject to attachment, levy of
execution, or sequestration by order of any court, except for a
beneficiary of this statutory trust.
(d) All outstanding payment instruments and stored value issued or
sold by a licensee or its agent, and all outstanding money received
for transmission by a licensee or its agent, shall remain a liability
of the licensee from the time money or monetary value is received by
the licensee or its agent until the licensee receives confirmation
that such money or monetary value was received by the beneficiary, or
until the outstanding payment instrument or stored value obligation
has been paid, or until the money is refunded to the customer.
(e) A licensee shall maintain a record in the United States of
proof of receipt by the beneficiary or refund to the customer of
money received for transmission.
1831. (b) For the purposes of this chapter, the following are
United States currency eligible securities:
(1) Cash.
(2) Any deposit in an insured bank or an insured savings and loan
association or insured credit union.
(3) Any bond, note, or other obligation that is issued or is
guaranteed by the United States or any agency of the United States.
(4) Any bond, note, or other obligation that is issued or
guaranteed by any state of the United States or by any governmental
agency of or within any state of the United States and that is
assigned an eligible rating by an eligible securities rating service.
(5) Any bankers acceptance that is eligible for discount by a
federal reserve bank.
(6) Any commercial paper that is assigned an eligible rating by an
eligible rating securities service.
(7) Any bond, note, or other obligation that is assigned an
eligible rating by an eligible securities rating service.
(8) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1, et seq.), that holds itself out to
investors as a money market fund, and that operates in accordance
with all provisions of the Investment Company Act of 1940, and the
regulations of the Securities and Exchange Commission applicable to
money market funds, including Section 270.2a-7 of the regulations of
the Securities and Exchange Commission (17 C.F.R. Sec. 270.2a-7).
For purposes of this paragraph and paragraph (9), "investment
company," "management company," and "open-end" have the meanings set
forth in Sections 3, 4, and 5, respectively, of the Investment
Company Act of 1940 (15 U.S.C. Secs. 80a-4, and 80a-5, respectively).
(9) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), and that invests
exclusively in securities that constitute eligible securities that
comply with valuation requirements of this chapter.
(10) Any account due to any licensee from any agent in the United
States on account of the receipt of money on behalf of the licensee
for money transmission by the agent, if the account is current and
not past due or otherwise doubtful of collection.
(11) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities.
(c) "Foreign currency eligible security" means any of the
following that is denominated in a foreign currency:
(1) Cash.
(2) Any deposit in an office of a bank acceptable to the
commissioner that is located in a foreign country.
(3) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities pursuant to Section 1835.
(d) For the purposes of this chapter, "value" means the following:
(1) When used with respect to an eligible security owned by a
licensee of the type described in paragraph (10) of subdivision (b),
net carrying value as determined in conformity with United States
generally accepted accounting principles. However, in computing the
value of the account, any amount that consists of money that has not
been remitted to the licensee or refunded within 45 business days of
receipt by the agent shall be excluded from the value of the account
and shall be excluded from the calculation of eligible securities.
(2) Market value when used with respect to any other eligible
security owned by a licensee.
1832. (a) In computing for purposes of Section 1831 the aggregate
value of eligible securities owned by a licensee, all of the
following shall be excluded:
(1) The value of any eligible security if and to the extent that
the value of the eligible security, when combined with the aggregate
value of all other eligible securities owned by the licensee that are
issued or guaranteed by the same person or by any affiliate of the
same person by whom the eligible security is issued or guaranteed,
exceeds 10 percent of the aggregate value of all eligible securities
owned by the licensee.
(2) The portion of the aggregate value of all eligible securities
of the type described in paragraph (10) of subdivision (b) of Section
1831 that exceeds 25 percent of the aggregate value of all eligible
securities owned by the licensee; and that portion of the aggregate
value of agent receivables from any one person that exceeds 10
percent of the aggregate value of all eligible securities owned by
the licensee, or any higher percentage that the commissioner may
approve for the licensee, up to a maximum of 20 percent.
(3) The portion of the aggregate value of all eligible securities
of the type described in paragraph (6) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(4) The portion of the aggregate value of all eligible securities
of the type described in paragraph (7) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(5) The portion of the aggregate value of all eligible securities
of the type described in paragraph (8) of subdivision (b) of Section
1831, except for a money market fund that invests exclusively in
obligations issued or guaranteed by the United States or any agency
of the United States, that exceeds 20 percent of the aggregate value
of all eligible securities owned by the licensee.
(6) The portion of the aggregate value of all eligible securities
of the type described in paragraphs (6), (7), and (8) of subdivision
(b) of Section 1831 that exceeds 50 percent of the aggregate value of
all eligible securities owned by the licensee.
(b) Subdivision (a) shall not be deemed to require the exclusion
of the value of any of the following eligible securities, and each of
the following eligible securities shall be exempted from the
limitations of subdivision (a):
(1) The following eligible securities:
(A) Cash.
(B) Any deposit in an insured bank, insured savings and loan
association, or insured credit union.
(C) Any bond, note, or other obligation for the payment of which
the full faith and credit of the United States are pledged.
(2) Any eligible security that the commissioner, in view of the
financial condition of the obligor or issuer and such other factors
as may in the opinion of the commissioner be relevant, finds to be of
such quality that exclusion of the value of such eligible security
pursuant to subdivision (a) is not necessary for the purposes of this
chapter and which the commissioner by regulation or order exempts,
in whole or in part, from the limitations of subdivision (a).
1833. (a) A licensee shall be deemed to own an eligible security
only if the following apply:
(1) The licensee owns the eligible security solely and exclusively
in its own right, both of record and beneficially.
(2) The eligible security is not subject to any pledge, lien, or
security interest.
(3) The licensee can freely negotiate, assign, or otherwise
transfer the eligible security.
(b) Notwithstanding subdivision (a), no licensee shall be deemed
not to own an eligible security solely on account of any of the
following facts, provided that, but for that fact, the licensee would
be deemed to own the eligible security under the provisions of
subdivision (a):
(1) The fact that the eligible security is owned of record by a
documented nominee of the licensee or by a securities depository.
(2) The fact that the licensee has pledged the eligible security
with the United States or any state of the United States to secure
payment by the licensee of transmission money.
1834. If the commissioner finds that any eligible security or class
of eligible securities is not of sufficient liquidity or quality to
be eligible securities, the commissioner may by regulation or order
declare the security or class of securities to be ineligible.
1835. If the commissioner finds that any security or class of
securities that is not an eligible security is of sufficient
liquidity and quality to be an eligible security, the commissioner
may by regulation or order declare the security or class of
securities to be eligible securities.
1836. (a) If the commissioner finds that a rating assigned to a
class of securities by an eligible securities rating service
indicates that the class of securities is of sufficient quality to be
eligible securities, the commissioner may by regulation or order
declare the rating to be an eligible rating.
(b) With respect to this chapter "eligible rating" means any
rating assigned to such security or class of securities by such
eligible securities rating service which the commissioner has by
regulation or order declared to be an eligible rating.
1837. (a) The commissioner may by regulation or order declare a
securities rating service to be an eligible securities rating service
if the commissioner finds the following with respect to the
securities rating service:
(1) It has been continuously engaged in the business of rating
securities for a period of not less than three years.
(2) It is competent to rate securities and is nationally
recognized for rating securities in a competent manner.
(3) It publishes its ratings of securities on a nationwide basis.
(b) With respect to this chapter "eligible securities rating
service" means any securities rating service that the commissioner by
regulation or order declared to be an eligible securities ratings
service.
1838. A licensee shall maintain eligible securities that are
adequately diversified, predominantly of a duration commensurate with
the licensee's outstanding money transmission obligations, and of
sufficient liquidity and quality to promptly pay the outstanding
money transmission obligations of the licensee.
1830. (a) A licensee shall at all times own eligible securities
having an aggregate market value computed in accordance with United
States generally accepted accounting principles of not less than the
aggregate amount of all of its outstanding payment instruments and
stored value obligations issued or sold in the United States and all
outstanding money received for transmission in the United States.
(b) If the commissioner finds that the financial condition of a
licensee is impaired, or that the financial condition of a licensee
is such that its business is being conducted in an unsafe and unsound
manner, the commissioner, to protect the public interest, may issue
an order, subject to the procedures set forth in Section 1864, doing
one or both of the following:
(1) Increasing the amount of eligible securities that the licensee
must maintain.
(2) Requiring the licensee to obtain, as security for the payment
of outstanding money transmission obligations, additional security in
the form of financial guarantees.
(c) Eligible securities, even if commingled with other assets of
the licensee, are deemed to be held in trust for the benefit of the
purchasers and holders of the licensee's outstanding payment
instrument and stored value obligations, and all senders of
outstanding money received for transmission, in the event of
bankruptcy or receivership of the licensee, or in the event of an
action by a creditor against the licensee who is not a beneficiary of
this statutory trust. No eligible securities impressed with a trust
pursuant to this subdivision shall be subject to attachment, levy of
execution, or sequestration by order of any court, except for a
beneficiary of this statutory trust.
(d) All outstanding payment instruments and stored value issued or
sold by a licensee or its agent, and all outstanding money received
for transmission by a licensee or its agent, shall remain a liability
of the licensee from the time money or monetary value is received by
the licensee or its agent until the licensee receives confirmation
that such money or monetary value was received by the beneficiary, or
until the outstanding payment instrument or stored value obligation
has been paid, or until the money is refunded to the customer.
(e) A licensee shall maintain a record in the United States of
proof of receipt by the beneficiary or refund to the customer of
money received for transmission.
1831. (b) For the purposes of this chapter, the following are
United States currency eligible securities:
(1) Cash.
(2) Any deposit in an insured bank or an insured savings and loan
association or insured credit union.
(3) Any bond, note, or other obligation that is issued or is
guaranteed by the United States or any agency of the United States.
(4) Any bond, note, or other obligation that is issued or
guaranteed by any state of the United States or by any governmental
agency of or within any state of the United States and that is
assigned an eligible rating by an eligible securities rating service.
(5) Any bankers acceptance that is eligible for discount by a
federal reserve bank.
(6) Any commercial paper that is assigned an eligible rating by an
eligible rating securities service.
(7) Any bond, note, or other obligation that is assigned an
eligible rating by an eligible securities rating service.
(8) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1, et seq.), that holds itself out to
investors as a money market fund, and that operates in accordance
with all provisions of the Investment Company Act of 1940, and the
regulations of the Securities and Exchange Commission applicable to
money market funds, including Section 270.2a-7 of the regulations of
the Securities and Exchange Commission (17 C.F.R. Sec. 270.2a-7).
For purposes of this paragraph and paragraph (9), "investment
company," "management company," and "open-end" have the meanings set
forth in Sections 3, 4, and 5, respectively, of the Investment
Company Act of 1940 (15 U.S.C. Secs. 80a-4, and 80a-5, respectively).
(9) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), and that invests
exclusively in securities that constitute eligible securities that
comply with valuation requirements of this chapter.
(10) Any account due to any licensee from any agent in the United
States on account of the receipt of money on behalf of the licensee
for money transmission by the agent, if the account is current and
not past due or otherwise doubtful of collection.
(11) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities.
(c) "Foreign currency eligible security" means any of the
following that is denominated in a foreign currency:
(1) Cash.
(2) Any deposit in an office of a bank acceptable to the
commissioner that is located in a foreign country.
(3) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities pursuant to Section 1835.
(d) For the purposes of this chapter, "value" means the following:
(1) When used with respect to an eligible security owned by a
licensee of the type described in paragraph (10) of subdivision (b),
net carrying value as determined in conformity with United States
generally accepted accounting principles. However, in computing the
value of the account, any amount that consists of money that has not
been remitted to the licensee or refunded within 45 business days of
receipt by the agent shall be excluded from the value of the account
and shall be excluded from the calculation of eligible securities.
(2) Market value when used with respect to any other eligible
security owned by a licensee.
1832. (a) In computing for purposes of Section 1831 the aggregate
value of eligible securities owned by a licensee, all of the
following shall be excluded:
(1) The value of any eligible security if and to the extent that
the value of the eligible security, when combined with the aggregate
value of all other eligible securities owned by the licensee that are
issued or guaranteed by the same person or by any affiliate of the
same person by whom the eligible security is issued or guaranteed,
exceeds 10 percent of the aggregate value of all eligible securities
owned by the licensee.
(2) The portion of the aggregate value of all eligible securities
of the type described in paragraph (10) of subdivision (b) of Section
1831 that exceeds 25 percent of the aggregate value of all eligible
securities owned by the licensee; and that portion of the aggregate
value of agent receivables from any one person that exceeds 10
percent of the aggregate value of all eligible securities owned by
the licensee, or any higher percentage that the commissioner may
approve for the licensee, up to a maximum of 20 percent.
(3) The portion of the aggregate value of all eligible securities
of the type described in paragraph (6) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(4) The portion of the aggregate value of all eligible securities
of the type described in paragraph (7) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(5) The portion of the aggregate value of all eligible securities
of the type described in paragraph (8) of subdivision (b) of Section
1831, except for a money market fund that invests exclusively in
obligations issued or guaranteed by the United States or any agency
of the United States, that exceeds 20 percent of the aggregate value
of all eligible securities owned by the licensee.
(6) The portion of the aggregate value of all eligible securities
of the type described in paragraphs (6), (7), and (8) of subdivision
(b) of Section 1831 that exceeds 50 percent of the aggregate value of
all eligible securities owned by the licensee.
(b) Subdivision (a) shall not be deemed to require the exclusion
of the value of any of the following eligible securities, and each of
the following eligible securities shall be exempted from the
limitations of subdivision (a):
(1) The following eligible securities:
(A) Cash.
(B) Any deposit in an insured bank, insured savings and loan
association, or insured credit union.
(C) Any bond, note, or other obligation for the payment of which
the full faith and credit of the United States are pledged.
(2) Any eligible security that the commissioner, in view of the
financial condition of the obligor or issuer and such other factors
as may in the opinion of the commissioner be relevant, finds to be of
such quality that exclusion of the value of such eligible security
pursuant to subdivision (a) is not necessary for the purposes of this
chapter and which the commissioner by regulation or order exempts,
in whole or in part, from the limitations of subdivision (a).
1833. (a) A licensee shall be deemed to own an eligible security
only if the following apply:
(1) The licensee owns the eligible security solely and exclusively
in its own right, both of record and beneficially.
(2) The eligible security is not subject to any pledge, lien, or
security interest.
(3) The licensee can freely negotiate, assign, or otherwise
transfer the eligible security.
(b) Notwithstanding subdivision (a), no licensee shall be deemed
not to own an eligible security solely on account of any of the
following facts, provided that, but for that fact, the licensee would
be deemed to own the eligible security under the provisions of
subdivision (a):
(1) The fact that the eligible security is owned of record by a
documented nominee of the licensee or by a securities depository.
(2) The fact that the licensee has pledged the eligible security
with the United States or any state of the United States to secure
payment by the licensee of transmission money.
1834. If the commissioner finds that any eligible security or class
of eligible securities is not of sufficient liquidity or quality to
be eligible securities, the commissioner may by regulation or order
declare the security or class of securities to be ineligible.
1835. If the commissioner finds that any security or class of
securities that is not an eligible security is of sufficient
liquidity and quality to be an eligible security, the commissioner
may by regulation or order declare the security or class of
securities to be eligible securities.
1836. (a) If the commissioner finds that a rating assigned to a
class of securities by an eligible securities rating service
indicates that the class of securities is of sufficient quality to be
eligible securities, the commissioner may by regulation or order
declare the rating to be an eligible rating.
(b) With respect to this chapter "eligible rating" means any
rating assigned to such security or class of securities by such
eligible securities rating service which the commissioner has by
regulation or order declared to be an eligible rating.
1837. (a) The commissioner may by regulation or order declare a
securities rating service to be an eligible securities rating service
if the commissioner finds the following with respect to the
securities rating service:
(1) It has been continuously engaged in the business of rating
securities for a period of not less than three years.
(2) It is competent to rate securities and is nationally
recognized for rating securities in a competent manner.
(3) It publishes its ratings of securities on a nationwide basis.
(b) With respect to this chapter "eligible securities rating
service" means any securities rating service that the commissioner by
regulation or order declared to be an eligible securities ratings
service.
1838. A licensee shall maintain eligible securities that are
adequately diversified, predominantly of a duration commensurate with
the licensee's outstanding money transmission obligations, and of
sufficient liquidity and quality to promptly pay the outstanding
money transmission obligations of the licensee.
1830. (a) A licensee shall at all times own eligible securities
having an aggregate market value computed in accordance with United
States generally accepted accounting principles of not less than the
aggregate amount of all of its outstanding payment instruments and
stored value obligations issued or sold in the United States and all
outstanding money received for transmission in the United States.
(b) If the commissioner finds that the financial condition of a
licensee is impaired, or that the financial condition of a licensee
is such that its business is being conducted in an unsafe and unsound
manner, the commissioner, to protect the public interest, may issue
an order, subject to the procedures set forth in Section 1864, doing
one or both of the following:
(1) Increasing the amount of eligible securities that the licensee
must maintain.
(2) Requiring the licensee to obtain, as security for the payment
of outstanding money transmission obligations, additional security in
the form of financial guarantees.
(c) Eligible securities, even if commingled with other assets of
the licensee, are deemed to be held in trust for the benefit of the
purchasers and holders of the licensee's outstanding payment
instrument and stored value obligations, and all senders of
outstanding money received for transmission, in the event of
bankruptcy or receivership of the licensee, or in the event of an
action by a creditor against the licensee who is not a beneficiary of
this statutory trust. No eligible securities impressed with a trust
pursuant to this subdivision shall be subject to attachment, levy of
execution, or sequestration by order of any court, except for a
beneficiary of this statutory trust.
(d) All outstanding payment instruments and stored value issued or
sold by a licensee or its agent, and all outstanding money received
for transmission by a licensee or its agent, shall remain a liability
of the licensee from the time money or monetary value is received by
the licensee or its agent until the licensee receives confirmation
that such money or monetary value was received by the beneficiary, or
until the outstanding payment instrument or stored value obligation
has been paid, or until the money is refunded to the customer.
(e) A licensee shall maintain a record in the United States of
proof of receipt by the beneficiary or refund to the customer of
money received for transmission.
1831. (b) For the purposes of this chapter, the following are
United States currency eligible securities:
(1) Cash.
(2) Any deposit in an insured bank or an insured savings and loan
association or insured credit union.
(3) Any bond, note, or other obligation that is issued or is
guaranteed by the United States or any agency of the United States.
(4) Any bond, note, or other obligation that is issued or
guaranteed by any state of the United States or by any governmental
agency of or within any state of the United States and that is
assigned an eligible rating by an eligible securities rating service.
(5) Any bankers acceptance that is eligible for discount by a
federal reserve bank.
(6) Any commercial paper that is assigned an eligible rating by an
eligible rating securities service.
(7) Any bond, note, or other obligation that is assigned an
eligible rating by an eligible securities rating service.
(8) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1, et seq.), that holds itself out to
investors as a money market fund, and that operates in accordance
with all provisions of the Investment Company Act of 1940, and the
regulations of the Securities and Exchange Commission applicable to
money market funds, including Section 270.2a-7 of the regulations of
the Securities and Exchange Commission (17 C.F.R. Sec. 270.2a-7).
For purposes of this paragraph and paragraph (9), "investment
company," "management company," and "open-end" have the meanings set
forth in Sections 3, 4, and 5, respectively, of the Investment
Company Act of 1940 (15 U.S.C. Secs. 80a-4, and 80a-5, respectively).
(9) Any share of an investment company that is an open-end
management company, that is registered under the Investment Company
Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), and that invests
exclusively in securities that constitute eligible securities that
comply with valuation requirements of this chapter.
(10) Any account due to any licensee from any agent in the United
States on account of the receipt of money on behalf of the licensee
for money transmission by the agent, if the account is current and
not past due or otherwise doubtful of collection.
(11) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities.
(c) "Foreign currency eligible security" means any of the
following that is denominated in a foreign currency:
(1) Cash.
(2) Any deposit in an office of a bank acceptable to the
commissioner that is located in a foreign country.
(3) Any other security or class of securities that the
commissioner has by regulation or order declared to be eligible
securities pursuant to Section 1835.
(d) For the purposes of this chapter, "value" means the following:
(1) When used with respect to an eligible security owned by a
licensee of the type described in paragraph (10) of subdivision (b),
net carrying value as determined in conformity with United States
generally accepted accounting principles. However, in computing the
value of the account, any amount that consists of money that has not
been remitted to the licensee or refunded within 45 business days of
receipt by the agent shall be excluded from the value of the account
and shall be excluded from the calculation of eligible securities.
(2) Market value when used with respect to any other eligible
security owned by a licensee.
1832. (a) In computing for purposes of Section 1831 the aggregate
value of eligible securities owned by a licensee, all of the
following shall be excluded:
(1) The value of any eligible security if and to the extent that
the value of the eligible security, when combined with the aggregate
value of all other eligible securities owned by the licensee that are
issued or guaranteed by the same person or by any affiliate of the
same person by whom the eligible security is issued or guaranteed,
exceeds 10 percent of the aggregate value of all eligible securities
owned by the licensee.
(2) The portion of the aggregate value of all eligible securities
of the type described in paragraph (10) of subdivision (b) of Section
1831 that exceeds 25 percent of the aggregate value of all eligible
securities owned by the licensee; and that portion of the aggregate
value of agent receivables from any one person that exceeds 10
percent of the aggregate value of all eligible securities owned by
the licensee, or any higher percentage that the commissioner may
approve for the licensee, up to a maximum of 20 percent.
(3) The portion of the aggregate value of all eligible securities
of the type described in paragraph (6) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(4) The portion of the aggregate value of all eligible securities
of the type described in paragraph (7) of subdivision (b) of Section
1831 that exceeds 20 percent of the aggregate value of all eligible
securities owned by the licensee.
(5) The portion of the aggregate value of all eligible securities
of the type described in paragraph (8) of subdivision (b) of Section
1831, except for a money market fund that invests exclusively in
obligations issued or guaranteed by the United States or any agency
of the United States, that exceeds 20 percent of the aggregate value
of all eligible securities owned by the licensee.
(6) The portion of the aggregate value of all eligible securities
of the type described in paragraphs (6), (7), and (8) of subdivision
(b) of Section 1831 that exceeds 50 percent of the aggregate value of
all eligible securities owned by the licensee.
(b) Subdivision (a) shall not be deemed to require the exclusion
of the value of any of the following eligible securities, and each of
the following eligible securities shall be exempted from the
limitations of subdivision (a):
(1) The following eligible securities:
(A) Cash.
(B) Any deposit in an insured bank, insured savings and loan
association, or insured credit union.
(C) Any bond, note, or other obligation for the payment of which
the full faith and credit of the United States are pledged.
(2) Any eligible security that the commissioner, in view of the
financial condition of the obligor or issuer and such other factors
as may in the opinion of the commissioner be relevant, finds to be of
such quality that exclusion of the value of such eligible security
pursuant to subdivision (a) is not necessary for the purposes of this
chapter and which the commissioner by regulation or order exempts,
in whole or in part, from the limitations of subdivision (a).
1833. (a) A licensee shall be deemed to own an eligible security
only if the following apply:
(1) The licensee owns the eligible security solely and exclusively
in its own right, both of record and beneficially.
(2) The eligible security is not subject to any pledge, lien, or
security interest.
(3) The licensee can freely negotiate, assign, or otherwise
transfer the eligible security.
(b) Notwithstanding subdivision (a), no licensee shall be deemed
not to own an eligible security solely on account of any of the
following facts, provided that, but for that fact, the licensee would
be deemed to own the eligible security under the provisions of
subdivision (a):
(1) The fact that the eligible security is owned of record by a
documented nominee of the licensee or by a securities depository.
(2) The fact that the licensee has pledged the eligible security
with the United States or any state of the United States to secure
payment by the licensee of transmission money.
1834. If the commissioner finds that any eligible security or class
of eligible securities is not of sufficient liquidity or quality to
be eligible securities, the commissioner may by regulation or order
declare the security or class of securities to be ineligible.
1835. If the commissioner finds that any security or class of
securities that is not an eligible security is of sufficient
liquidity and quality to be an eligible security, the commissioner
may by regulation or order declare the security or class of
securities to be eligible securities.
1836. (a) If the commissioner finds that a rating assigned to a
class of securities by an eligible securities rating service
indicates that the class of securities is of sufficient quality to be
eligible securities, the commissioner may by regulation or order
declare the rating to be an eligible rating.
(b) With respect to this chapter "eligible rating" means any
rating assigned to such security or class of securities by such
eligible securities rating service which the commissioner has by
regulation or order declared to be an eligible rating.
1837. (a) The commissioner may by regulation or order declare a
securities rating service to be an eligible securities rating service
if the commissioner finds the following with respect to the
securities rating service:
(1) It has been continuously engaged in the business of rating
securities for a period of not less than three years.
(2) It is competent to rate securities and is nationally
recognized for rating securities in a competent manner.
(3) It publishes its ratings of securities on a nationwide basis.
(b) With respect to this chapter "eligible securities rating
service" means any securities rating service that the commissioner by
regulation or order declared to be an eligible securities ratings
service.
1838. A licensee shall maintain eligible securities that are
adequately diversified, predominantly of a duration commensurate with
the licensee's outstanding money transmission obligations, and of
sufficient liquidity and quality to promptly pay the outstanding
money transmission obligations of the licensee.
