07 LC 34
1207S
The
House Committee on Banks and Banking offers the following substitute to SB
70:
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Chapter 1 of Title 7 of the Official Code of Georgia Annotated, relating
to financial institutions generally, so as to update the banking laws in order
to reflect changes in federal law and for other purposes; to exclude the value
of good will in certain transactions; to regulate real estate loans; to allow
for the electronic transmission of proxy; to allow for share exchange in mergers
or consolidations; to define share exchange; to change the qualifications for
check sellers; to require background checks on employees and agents of check
sellers; to provide for registration and testing of check sellers who are not
licensed; to provide for a bond to be posted by check sellers; to provide for a
cease and desist order to be issued against noncompliant licensees; to provide a
penalty for withholding or falsifying information submitted to the department;
to provide for registered check cashers; to provide for background checks for
check cashers; to place a limit on check-cashing fees; to provide for background
checks for mortgage lenders or mortgage brokers; to provide for advertising
restrictions; to provide for related matters; to provide an effective date; to
repeal conflicting laws; and for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Chapter
1 of Title 7 of the Official Code of Georgia Annotated, relating to financial
institutions generally, is amended by revising subparagraph (A) of paragraph
(35) of Code Section 7-1-4, relating to definitions, as follows:
"(A)
The sum of the capital stock, the paid-in capital, the appropriated retained
earnings, and the capital debt of a bank or trust company
less any
amount of good will, core deposit intangibles, or other intangible assets
related to the purchase, acquisition, or merger of a bank
charter; or"
SECTION
2.
Said
chapter is further amended in Code Section 7-1-286, relating to real estate
loans, by revising subsection (a) in its entirety as follows:
"(a)
A bank shall make loans secured by improved or unimproved real estate (including
a leasehold) subject to the provisions of Part 365 of the Federal Deposit
Insurance Corporation´s rules and regulations, including 12 C.F.R. 365.1
and 365.2 and the Interagency Guidelines for Real Estate Lending Policies in
Appendix A and 12 C.F.R. 208.51 and the guidelines contained in 12 C.F.R. Part
208 in the case of Federal Reserve member banks. Such loans shall also be
subject to the additional provisions and exceptions as set forth in the rules of
the department."
SECTION
3.
Said
chapter is further amended in Code Section 7-1-437, relating to proxies, by
revising subsection (a) as follows:
"(a)
Unless otherwise unlawful, a person or corporation who is entitled to attend a
shareholders´ meeting, to vote thereat, or to execute consents, waivers, or
releases may be represented at such meeting or vote thereat, and execute
consents, waivers, and releases, and exercise any of his
or
her other rights, by one or more agents,
who may be either an individual or individuals or any domestic or foreign
corporation, authorized by a written proxy or
electronic
transmission of proxy executed by such
person or by his
or
her attorney in fact."
SECTION
4.
Said
chapter is further amended by revising Code Section 7-1-530, relating to
authority to merge or consolidate and merger or consolidation across state
lines, as follows:
"7-1-530.
(a)
Upon compliance with the requirements of this part and other applicable laws and
regulations, including any branching and minimum age laws and regulations, one
or more banks or trust companies may merge or consolidate, provided that an
institution exercising trust powers alone may merge or consolidate only with
another such trust company.
Upon
compliance with the requirements of this part and other applicable laws and
regulations, including any branching and minimum age laws and regulations, a
corporation other than a bank or trust company may acquire all of the
outstanding shares of one or more classes or series of one or more banks or
trust companies through a share exchange.
(b)
A corporation other than a bank or trust company may be merged into or
consolidated
with, or may
enter into a share exchange with, a bank
or trust company, provided that:
(1)
The resulting institution
of the merger
or consolidation is a bank or trust
company;
(2)
The resulting institution
of the merger
or consolidation, or the acquired bank or trust company in a share
exchange, holds only assets and
liabilities and is engaged only in activities which may be held or engaged in by
a bank or trust company; and
(3)
The merger,
share exchange, or consolidation is not
otherwise unlawful.
(c)
A merger,
share exchange, or consolidation pursuant
to subsection (b) of this Code section shall be made by compliance with the
requirements of this part. Title 14 shall not be applicable to such a
merger, share
exchange, or consolidation.
(d)
A merger,
share exchange, or consolidation across
state lines
of
any
involving
one or more banks or trust companies shall also be subject to the provisions of
Part 20 of this article.
(e)
In the case of a merger of a Georgia state bank with any other bank or banks,
with the Georgia bank as the resulting bank, any assets, lines of business,
activities, or powers which may accrue to the resulting bank which would not be
allowed for a Georgia state bank shall be provided for in the plan of merger.
Such plan shall include the proposal for holding or disposal of such assets or
the continuation or termination of such line of business, activity, or power.
The department shall review the plan to determine whether, in the interest of
safety and soundness and consistent with the other objectives of Code Section
7-1-3, the activity, power, asset, or line of business should be approved,
denied, or phased out within a reasonable period of time, to be determined by
the department.
(f)
As used in this part, the term 'share exchange' means a plan of exchange of all
of the outstanding shares of one or more classes or series of shares in
accordance with this part.
(g)
Subject to the provisions of this part, this Code section does not limit the
power of a corporation other than a bank or trust company to acquire all or part
of the shares of one or more classes or series of a bank or trust company
through a voluntary exchange of shares or
otherwise."
SECTION
5.
Said
chapter is further amended in Code Section 7-1-531, relating to requirements for
merger or consolidation plan and modification of the plan, by revising
subsection (a) as follows:
"(a)
The requirements for a
merger, share
exchange, or consolidation which must be
satisfied by the parties thereto are as follows:
(1)
The parties shall adopt a plan stating the method, terms, and conditions of the
merger, share
exchange, or consolidation, including the
rights under the plan of the shareholders of each of the parties and any
agreement concerning the
merger, share
exchange, or consolidation. Said plan
shall specify:
(A)
The name that such bank or trust company shall have upon and after such
merger, share
exchange, or consolidation, which may be
the name of any one of the institutions or the combined names of two or more of
the institutions or such other name as stated;
(B)
The persons who shall constitute the board of directors of the bank or trust
company after the
merger, share
exchange, or consolidation;
(C)
The
In the case of
a merger or consolidation, the manner and
basis of converting the shares of each merged or consolidated institution into
shares or other securities or obligations of the surviving bank or trust company
and, if any shares of any of the merged or consolidated institutions are not to
be converted solely into shares or other securities of the surviving bank or
trust company, the amount of cash or securities of any other corporation, or
combination of cash and such securities, which is to be paid or delivered to the
holders of such shares in exchange for or upon the surrender of such shares,
which cash or securities may be in addition to or in lieu of the shares or other
securities of the surviving bank or trust company;
and
(D)
In the case of a share exchange, the terms and conditions of the share exchange
and the manner and basis of exchanging the shares to be acquired for shares,
obligations, or other securities of the acquiring or any other corporation or
for cash or other property in whole or in part; and
(D)(E)
Such other provisions with respect to the proposed merger or consolidation as
are deemed desirable.
(2)
Adoption of the plan by each party thereto shall require the affirmative vote of
at least:
(A)
A majority of the directors; and
(B)
The shareholders entitled to cast two-thirds of the votes which all shareholders
are entitled to cast thereon and, if any class of shares is entitled to vote
thereon as a class, the holders of at least two-thirds of the outstanding shares
of such class, at a meeting of shareholders.
(3)
The notice shall include a copy or summary of the plan and a full statement of
the rights and remedies of dissenting shareholders, the method of exercising
them, and the limitations on such rights and remedies."
SECTION
6.
Said
chapter is further amended by revising Code Section 7-1-532, relating to
execution, contents, and filing of articles of merger or consolidation, as
follows:
"7-1-532.
(a)
Upon adoption of the plan of
merger, share
exchange, or consolidation as provided in
Code Section 7-1-531, the parties to the
merger, share
exchange, or consolidation shall file in
duplicate with the department articles of a
merger, share
exchange, or consolidation as required by
this Code section, together with the fee required by Code Section
7-1-862.
(b)
The articles of
merger, share
exchange, or consolidation shall be signed
by two duly authorized officers of each party to the plan under their respective
seals and shall contain:
(1)
The names of the parties to the plan and of the resulting bank or trust company
or the
acquiring corporation in a share
exchange;
(2)
The street address and county of the location of the main office and registered
agent and registered office of each;
(3)
The votes by which the plan was adopted and the time, place, and notice of each
meeting in connection with such adoption;
(4)
The names and addresses of the first directors of the resulting bank or trust
company or the
directors of the acquired corporation in a share
exchange;
(5)
In the case of a merger, any amendment of the articles of the resulting bank or
trust company;
(6)
In the case of a consolidation, the provisions required in articles of a new
bank or trust company by paragraphs (4), (5), (6), (7), and (10) of subsection
(a) of Code Section 7-1-392; and
(7)
The plan.
(c)
Together with the articles of
merger, share
exchange, or consolidation, the parties
shall deliver to the department a copy of the notice of
merger, share
exchange, or consolidation and an
undertaking, which may appear in the articles of
merger, share
exchange, or consolidation or be set forth
in a letter or other instrument executed by an officer or any person authorized
to act on behalf of such bank or trust company, that the request for publication
of a notice of filing the articles of
merger, share
exchange, or consolidation and payment
therefor will be made as required by subsection (d) of this Code
section.
(d)
No later than the next business day after filing the articles of
merger, share
exchange, or consolidation with the
department, the parties shall mail or deliver to the publisher of a newspaper
which is the official organ of the county where the main office of each party is
located a notice which shall contain a statement that the articles of
merger, share
exchange, or consolidation have been filed
with the department, the names of the institutions which are parties to the
proposed
merger, share
exchange, or consolidation, and
in the case of
a merger the proposed name of the
surviving bank or trust
company,
and shall designate a place where a copy of the articles of
merger, share
exchange, or consolidation may be
examined. Subsections (b) and (c) of Code Section 7-1-7 shall also apply to the
notice.
(e)
The request for publication of the notice shall be accompanied by a check,
draft, or money order in the proper amount in payment of the cost of
publication. The notice shall be published once a week for two consecutive
weeks commencing within ten days after receipt of the notice by the
newspaper.
(f)
In the event the plan is amended as provided in Code Section 7-1-531, the
parties shall promptly file in duplicate with the department an amendment to the
articles of
consolidation,
share exchange, or merger reflecting such
amendment of the plan."
SECTION
7.
Said
chapter is further amended by revising Code Section 7-1-533, relating to
additional filings with plans of merger or consolidation, as
follows:
"7-1-533.
The
parties to the plan shall also file with the department:
(1)
An application and information desired by the department in order to evaluate
the proposed
merger, share
exchange, or consolidation, which shall be
made available in the form specified by the department;
(2)
Applicable fees established by regulation of the department to defray the
expenses of the investigation required by Code Section 7-1-534; and
(3)
If the merger,
share exchange, or consolidation involves
the adoption of a new name, a certificate of the Secretary of State reserving
said name under Code Section 7-1-131.
SECTION
8.
Said
chapter is further amended by revising Code Section 7-1-534, relating to
approval or disapproval of articles of consolidation or merger by department, as
follows:
"7-1-534.
(a)
Upon receipt of the articles of
consolidation,
share exchange, or merger and the filings
required by Code Section 7-1-533, the department shall conduct such
investigation as it may deem necessary to ascertain whether:
(1)
The articles of
merger, share
exchange, or consolidation and supporting
items satisfy the requirements of this chapter;
(2)
The plan and any modification thereof adequately protect the interests of
depositors, other creditors, and shareholders;
(3)
The requirements for a
merger, share
exchange, or consolidation under all
applicable laws have been satisfied and the resulting bank or trust company
or the
acquired bank or trust company in a share
exchange would satisfy the requirements of
this chapter applicable to it; and
(4)
The merger,
share exchange, or consolidation would be
consistent with adequate and sound banking or fiduciary practice and in the
public interest on the basis of:
(A)
The financial history and condition of the parties to the plan;
(B)
Their prospects;
(C)
The character of their management; and
(D)
The convenience and needs of the area primarily to be served by the resulting
institution,
or by the acquiring corporation and the acquired bank or trust company in a
share exchange.
(b)
Within 90 days after receipt of the articles of
merger, share
exchange, or consolidation, the notice of
merger or
share exchange, and the filings required
by Code Section 7-1-533, or within an additional period of not more than 30 days
after an amendment to the application is received within the initial 90 day
period, the department shall, in its discretion, approve or disapprove the
articles on the basis of its investigation and the criteria set forth in
subsection (a) of this Code section. Except as provided in Code Section
7-1-535, the department shall give the Secretary of State written notice of its
approval with a copy of the articles of
merger, share
exchange, or consolidation and a copy of
the notice of merger
or share
exchange attached. The department shall
also give the parties to the plan written notice of its decision and, in the
event of disapproval, a statement in general of the reasons for its decision.
The decision of the department shall be conclusive, except that it may be
subject to judicial review as provided in Code Section
7-1-90."
SECTION
9.
Said
chapter is further amended by revising Code Section 7-1-535, relating to
procedure after approval of articles by department and the issuance of a
certificate of merger or consolidation, as follows:
"7-1-535.
(a)
If the laws of the United States require the approval of the
merger, share
exchange, or consolidation by any federal
agency, the department may, at its option, after its approval, retain its notice
to the Secretary of State until it receives notice of the decision of such
agency. If such agency shall refuse to give its approval, the department may,
at its option, notify the parties to the plan that the department´s
approval has been rescinded for that reason. If such agency gives its approval,
the department shall deliver its written approval to the Secretary of State for
issuance of a certificate of
merger, share
exchange, or consolidation by the
Secretary of State and shall notify the parties to the plan.
(b)
If all the taxes, fees, and charges required by law shall have been paid and if
the name of the resulting bank or trust company
in a merger or
consolidation continues to be reserved or
is available on the records of the Secretary of State, upon receipt of the
written approval of the department, the Secretary of State shall issue to the
resulting bank or trust company
or the
acquiring corporation in a share exchange
a certificate of
merger, share
exchange, or consolidation with the
approved articles of merger or consolidation attached thereto and shall retain a
copy of such certificate, articles, and approval by the
department."
SECTION
10.
Said
chapter is further amended by revising Code Section 7-1-536, relating to the
effect of merger or consolidation, as follows:
"7-1-536.
(a)
As of the issuance of the certificate of
merger, share
exchange, or consolidation by the
Secretary of State, the
merger, share
exchange, or consolidation shall be
effective.
(b)
The certificate of
merger, share
exchange, or consolidation shall be
conclusive evidence of the performance of all conditions precedent to the
merger, share
exchange, or consolidation and of the
existence or creation of the bank or trust institution, except as against the
state.
(c)
When a merger or consolidation becomes effective, each party to the plan, except
the resulting bank or trust company, shall cease to exist as a separate entity
but shall continue in, and the parties to the plan shall be, a single
corporation which shall be the bank or trust company and which shall have,
without further act or deed, all the property, rights, powers, trusts, duties,
and obligations of each party to the plan.
When a share
exchange becomes effective, the shares of each acquired bank or trust company
are exchanged as provided in the plan, and the former holders of the shares are
entitled only to the share exchange rights provided in the plan of share
exchange or to their rights under Code Section 7-1-537.
(d)
The articles of the resulting bank or trust company shall be, in the case of a
merger, the same as its articles prior to the merger with any change stated in
the articles of merger or, in the case of a consolidation, the provisions stated
in the articles of consolidation.
(e)
The resulting bank or trust
company, or
the acquired bank or trust company in a share
exchange, shall have the authority to
engage only in such business and exercise only such powers as are then
permissible upon original incorporation under this chapter and shall be subject
to the same prohibitions and limitations as it would then be subject to upon
original incorporation. It may, however, subject to permission of the
department as set out in Code Sections 7-1-530 and 7-1-555, engage in any
business and exercise any right that any bank or trust company which is a party
to the plan could lawfully exercise or engage in immediately prior to the
merger, share
exchange, or consolidation.
(f)
No liability of any party to the plan or of its shareholders, directors, or
officers shall be affected nor shall any lien on any property of a party to the
plan be impaired by the
merger, share
exchange, or consolidation. Any claim
existing or action pending by or against any party to the plan may be prosecuted
to judgment as if the
merger, share
exchange, or consolidation had not taken
place or the resulting bank or trust company may be substituted in its
place."
SECTION
11.
Said
chapter is further amended by revising Code Section 7-1-537, relating to rights
of dissenting shareholders and the surrender of stock certificates, as
follows:
"7-1-537.
(a)
A shareholder of a bank or trust company which is a party to a plan of proposed
merger, share
exchange, or consolidation under this part
who objects to the plan shall be entitled to the rights and remedies of a
dissenting shareholder as determined under Chapter 2 of Title 14, known as the
'Georgia Business Corporation Code.'
(b)
The bank or trust company into which the other or others have been merged or
consolidated,
or the
acquiring corporation in a share exchange,
as the case may be, shall have the right to require the return of the original
certificates of stock held by each shareholder in each or either of the
institutions and in lieu thereof:
(1)
To issue to each shareholder new certificates for such number of shares of the
institution into which the others shall have been merged or consolidated
or of the
acquiring corporation in a share exchange;
or
(2)
To cause to be paid or delivered to each shareholder the amount of cash or
securities of any other corporation or combination of cash and such securities
as, under the plan of
merger, share
exchange, or consolidation, the said
shareholder may be entitled to receive."
SECTION
12.
Said
chapter is further amended by revising Code Section 7-1-557, relating to merger
or consolidation of nonbank corporations into national banks, as
follows:
"7-1-557.
A
national bank located in this state may merge or consolidate
with, or enter
into a share exchange with, a corporation
other than a bank or trust company, provided that:
(1)
Such merger,
share exchange, or consolidation is
permitted by the laws of the United States and such laws are complied
with;
(2)
The laws governing the
merger, share
exchange, or consolidation of such
corporation are complied with;
(3)
The resulting institution
of the merger
or consolidation, or the acquired bank in a share
exchange, is a national bank;
(4)
The resulting institution
of the merger
or consolidation, or the acquired bank in a share
exchange, holds only assets and
liabilities and engages only in activities which may be held or engaged in by a
national bank located in this state; and
(5)
The merger,
share exchange, or consolidation is not
otherwise unlawful."
SECTION
13.
Said
chapter is further amended in Code Section 7-1-601, relating to branch offices,
by revising paragraph (2) of subsection (a) as follows:
"(2)
New or additional branch offices may be established through merger,
share
exchange, consolidation, or sale of assets
pursuant to Part 14, 15, 16, 19, or 20 of this article;"
SECTION
14.
Said
chapter is further amended in Code Section 7-1-606, relating to unlawful actions
by bank holding companies unless prior approval of commissioner is received, by
revising subparagraphs (a)(1)(E), (b)(1)(A), and (b)(1)(B) as
follows:
"(E)
For any bank holding company to merge or consolidate
with, or enter
into a share exchange with, any other bank
holding company; or"
"(A)
Any acquisition or merger
or share
exchange or consolidation under this Code
section which would result in a monopoly or which would be in furtherance of any
combination or conspiracy to monopolize or to attempt to monopolize the business
of banking in any part of the State of Georgia; or
(B)
Any other proposed acquisition or merger
or share
exchange or consolidation under this Code
section whose effect in any section of the state may be substantially to lessen
competition, or to tend to create a monopoly, or which in any other manner would
be in restraint of trade, unless it finds that the anticompetitive effects of
the proposed transaction are clearly outweighed in the public interest by the
probable effect of the transaction in meeting the convenience and needs of the
community to be served."
SECTION
15.
Said
chapter is further amended in Code Section 7-1-608, relating to lawful and
unlawful acquisitions, formations, and mergers by bank holding companies, by
revising paragraph (3) of subsection (b) as follows:
"(3)
A bank holding company registered with the department and lawfully owning a bank
or a branch of a bank which was formed by the acquisition and subsequent merger
of or share
exchange with a Georgia bank, which bank
or branch does a lawful banking business in this state, may acquire control
through formation of a de novo bank in Georgia, provided that departmental
approval and any required federal approvals are obtained. No out-of-state bank
holding company may enter Georgia to do a banking business by formation of a de
novo bank; and"
SECTION
16.
Said
chapter is further amended in Code Section 7-1-670, relating to third-party
payment services offered by credit unions, by revising subsection (c) as
follows:
"(c)
Upon the commencement of third-party payment services, a credit union shall be
subject to Code Sections
7-1-286,
pertaining to real estate loans; 7-1-287,
pertaining to investment securities; 7-1-288, pertaining to corporate stock and
securities; 7-1-371, pertaining to legal reserve requirements; and rules and
regulations of the department relating to the foregoing Code sections of law and
shall not pay a greater rate of interest on third-party payment accounts than is
allowed to be paid by commercial banks."
SECTION
17.
Said
chapter is further amended by revising Code Section 7-1-681, relating to license
required for selling checks, as follows:
"7-1-681.
No
person or corporation, other than a bank or trust company, a credit union, a
savings and loan association, or a savings bank, whether state or federally
chartered, the
deposits of which are federally insured,
the authorized agent of a licensee, or the United States Postal Service shall
engage in the business of selling or issuing checks without having first
obtained a license under this article. This restriction applies to any
nonresident person or corporation that engages in this state in the business of
selling or issuing checks through a branch, subsidiary, affiliate, or agent in
this state. A license for the sale of checks or money orders shall also qualify
as a license for the business of money transmission.
The provisions
of this article shall also apply to the business of money transmission unless
specifically excluded."
SECTION
18.
Said
chapter is further amended by revising Code Section 7-1-682, relating to
qualifications of licensees to sell checks or money orders, as
follows:
"7-1-682.
(a)
In order to qualify for a license under this article, an applicant
shall:
(1)
Satisfy the department that it is financially sound and responsible and appears
able to conduct the business of selling checks in an honest and efficient manner
and with confidence and trust of the community; and
(2)
Comply with the bonding requirements, furnish the statements, and pay the fees
prescribed in this article. In the case of a money transmitter, the department
may in its discretion require only a bond.
(b)
In addition to the qualifications set forth in subsection (a) of this Code
section, the department may require a licensee to maintain investments having an
aggregate market value at least equal to the amount of outstanding checks issued
or sold, or
for money transmitters, equal to the outstanding orders to transmit but not yet
paid for by the licensee pursuant to this
article. The department may promulgate
regulations establishing those investments which shall be deemed permissible
investments for the purpose of complying with this subsection. Permissible
investments, even if commingled with other assets of the licensee, shall be
deemed by operation of law to be held in trust for the benefit of the purchasers
and holders of the licensee´s outstanding checks in the event of bankruptcy
of the licensee.
(c)
The department shall not issue such license
or may revoke
a license if it finds that the applicant
or
licensee,
any person who is a director, officer, partner, agent, employee, or
substantial
stockholder of the applicant
ultimate
equitable owner of 10 percent or more of the applicant or licensee, or any
individual who directs the affairs or establishes policy for the applicant or
licensee has been convicted of a felony
involving moral turpitude in any jurisdiction or of a crime which, if committed
within this state, would constitute a felony involving moral turpitude under the
laws of this state. For the purposes of this article, a person shall be deemed
to have been convicted of a crime if such person shall have pleaded guilty to a
charge thereof before a court or federal magistrate or shall have been found
guilty thereof by the decision or judgment of a court or federal magistrate or
by the verdict of a jury, irrespective of the pronouncement of sentence or the
suspension thereof, unless such plea of guilty or such decision, judgment, or
verdict shall have been set aside, reversed, or otherwise abrogated by lawful
judicial process and regardless of whether first offender treatment without
adjudication of guilt pursuant to the charge was entered, unless and until such
plea of guilty or such decision, judgment, or verdict shall have been set aside,
reversed, or otherwise abrogated by lawful judicial process or until probation,
sentence, or both probation and sentence of a first offender have been
successfully completed and documented or unless the person convicted of the
crime shall have received a pardon therefor from the President of the United
States or the governor or other pardoning authority in the jurisdiction where
the conviction was had, or shall have received an official certification or
pardon granted by the State Board of Pardons and Paroles which removes the legal
disabilities resulting from such conviction and restores civil and political
rights in this state.
The term
'substantial stockholder' as used in this subsection shall be deemed to refer to
a person owning or controlling 10 percent or more of the total outstanding stock
of the corporation in which such person is a stockholder.
(d)
The department shall be authorized to obtain conviction data with respect to any
applicant or any person who is a director, officer, partner, agent, employee, or
ultimate equitable owner of 10 percent or more of the applicant
or licensee or
any individual who directs the affairs or establishes policy for the applicant
or licensee. Upon receipt of information
from the Georgia Crime Information Center that is incomplete or that indicates
an applicant or any person who is a director, officer, partner, agent, employee,
or ultimate equitable owner of 10 percent or more of the applicant
or licensee or
any individual who directs the affairs or establishes policy for the applicant
or licensee has a criminal record in a
state other than Georgia, the department shall submit to the Georgia Crime
Information Center two complete sets of fingerprints of such applicant or such
person, the required records search fees, and such other information as may be
required.
Fees for
background checks that the department administers shall be submitted to the
department by applicants and licensees together with two completed sets of
fingerprint cards. Upon receipt thereof,
the Georgia Crime Information Center shall promptly transmit one set of
fingerprints to the Federal Bureau of Investigation for a search of bureau
records and an appropriate report and shall retain the other set and promptly
conduct a search of its own records and records to which it has access. The
Georgia Crime Information Center shall notify the department in writing of any
derogatory finding, including, but not limited to, any conviction data regarding
the fingerprint records check, or if there is no such finding. All conviction
data received by the department shall be used by the department for the
exclusive purpose of carrying out its responsibilities under this article, shall
not be a public record, shall be privileged, and shall not be disclosed to any
other person or agency except to any person or agency which otherwise has a
legal right to inspect the file. All such records shall be maintained by the
department pursuant to laws regarding such records and the rules and regulations
of the Federal Bureau of Investigation and the Georgia Crime Information Center,
as applicable. As used in this subsection, 'conviction data' means a record of
a finding, verdict, or plea of guilty or a plea of nolo contendere with regard
to any crime, regardless of whether an appeal of the conviction has been
sought.
(e)
Every applicant and licensee shall be authorized and required to obtain and
maintain the results of background checks on employees and agents working in or
for the applicant or licensee. Such background checks shall be handled by the
Georgia Crime Information Center pursuant to Code Section 35-3-34 and the rules
and regulations of the Georgia Crime Information Center. Applicants and
licensees shall be responsible for any applicable fees charged by the Georgia
Crime Information Center. An applicant or licensee shall only employ a person
whose background data has been checked and been found to be satisfactory prior
to the initial date of hire. This provision does not apply to directors,
officers, partners, agents, or ultimate equitable owners of 10 percent or more
or to persons who direct the company´s affairs or establish policy, whose
background must have been investigated through the department before taking
office, beginning employment, or securing ownership. Upon receipt of
information from the Georgia Crime Information Center that is incomplete or that
indicates an employee has a criminal record in any state other than Georgia, the
employer shall submit to the department two complete sets of fingerprints of
such person, together with the applicable fees and any other required
information. The department shall then submit such fingerprints as provided in
subsection (d) of this Code section.
(f)
Such license issued by the department shall be kept conspicuously posted in the
place of business of the licensee. Such license shall not be transferable,
assignable, or subject to a change of
ownership."
SECTION
19.
Said
chapter is further amended by revising Code Section 7-1-683, relating to license
application for check sellers, as follows:
"7-1-683.
(a)
Each application for a license shall be in writing and under oath to the
department, in such form as it may prescribe, and shall include the
following:
(1)
The legal name and principal office address of the corporation applying for the
license;
(2)
The name, residence, and business address of each director or equivalent
official and of each officer who will be involved in selling checks in this
state;
(3)
The date and place of incorporation;
(4)
If the applicant has one or more branches, subsidiaries, affiliates, agents, or
other locations at or through which the applicant proposes to engage in the
business of selling or issuing checks within the State of Georgia, the complete
name of each and the address of each such location;
(5)
The location where its initial registered office will be located in this state;
and
(6)
Such other data, financial statements, and pertinent information as the
department may require with respect to the applicant, its directors, trustees,
officers, members, branches, subsidiaries, affiliates, or agents
and any
individual who directs the affairs or establishes policy for the applicant or
licensee.
(b)
The application shall be filed together with
the following
financial requirements:
(1)
An investigation and supervision fee established by regulation of the
department, which shall not be refundable but which, if the license is granted,
shall satisfy the fee requirement for the first license year or the remaining
part thereof; and
(2)
A corporate surety bond issued by a bonding company or insurance company
authorized to do business in this state and approved by the department. The
bond for check sellers shall be in the principal sum of $100,000.00, and the
bond for money transmitters shall be in the principal sum of
$50,000.00,
and in an additional principal sum of $5,000.00 for each location, in excess of
one, at or through which the applicant proposes to engage in this state in the
business of selling or issuing checks, until the principal sum shall aggregate
$250,000.00, provided
that. The
amount of this bond shall be increased by an additional $5,000.00 for each
location, other than the licensee´s primary place of business, at or
through which the applicant proposes to engage in the business of selling or
issuing checks in this state, until the principal sum of the bond shall total a
maximum of $250,000.00. In addition to the coverage provided for in this Code
section, the department may require
additional coverage for the adequate protection of check holders if the average
daily balances outstanding
or, for
money transmitters,
for check
sellers or, if the outstanding orders to
transmit not yet paid for
by the
licensee
money
transmitters, exceed
$250,000.00.
Written reports that reveal a licensee´s level of holdings shall be
made at intervals during the year as
required by regulations. If required by the department the additional coverage
shall be limited to $1,250,000.00 or the
amount of
the average daily balances or orders
outstanding in the State of Georgia for the preceding year, whichever is
lesser
less.
The total
maximum amount of such bond coverage under this paragraph and paragraph (1) of
this subsection will be $1,500,000.00.
The bond shall be in a form satisfactory to the department and shall run to the
State of Georgia for the benefit of any check holders against the licensee or
his or her agents. The condition of the bond shall be that the licensee will
pay any and all moneys that may become due and owing any creditor of or claimant
against the licensee arising out of the licensee´s business of selling or
issuing checks in this state, whether through its own act or the acts of an
agent. The aggregate liability of the surety in no event shall exceed the
principal sum of the bond. Claimants against the licensee may themselves bring
an action directly on the bond. The liability arising under this paragraph
shall be limited to the receipt, handling, transmission, and payment of money
arising out of the licensee´s business of selling or issuing checks in this
state.
(c)
As an option to the bond for check sellers, provided the department approves, in
lieu of such corporate surety bond or bonds or of any portion of the principal
thereof, the applicant may deposit with a
Georgia
state-chartered bank or trust company
located in this state, as such applicant may designate and the department may
approve, certificates of deposit insured by a federal agency, bonds, notes,
debentures, or other obligations of the United States or any agency or
instrumentality thereof or guaranteed by the United States or of the State of
Georgia or
of a municipality, county, school district, or instrumentality of the State of
Georgia or guaranteed by the state to an
aggregate amount, based upon principal amount or market value, whichever is
lower, of not less than the amount of the required corporate surety bond or
portion thereof. These assets shall be held to secure the same obligations as
would the surety bond
and must be
dedicated by the licensee solely for the purpose of meeting the financial
obligations required to maintain the check seller license in this state and may
not be dedicated to meet check seller licensing requirements for other
jurisdictions; but the licensee shall be
entitled to receive all interest thereon and shall have the right, with the
approval of the department, to substitute other assets approved by this Code
section for those deposited and shall be required to do so on written order of
the department made for good cause shown; provided, however, if the licensee
substitutes assets more than once during the license period the department may
charge a fee for the processing of such substitution to be prescribed by
regulations of the department. In the event of the failure or insolvency of
such licensee, the assets, any proceeds therefrom, and the funds deposited
pursuant to this Code section shall be applied to the payment in full of claims
arising out of transactions in this state for the sale or issuance of checks.
Failure to
properly maintain dedicated assets for the purpose of meeting the financial
requirements for licensure may result in a fine, or the revocation or suspension
of the license, at the discretion of the
department. This subsection shall apply
to check sellers only and not to money transmitters."
SECTION
20.
Said
chapter is further amended in Code Section 7-1-686, relating to notice of action
against licensees or change in number of locations, by revising subsection (b)
as follows:
"(b)
A licensee shall give notice to the department by registered or certified mail
or statutory overnight delivery of
any
increase in the number of
the name and
address of any new or additional locations
at which it engages in the business of selling or issuing checks over the number
previously reported in either its original or renewal application and shall show
to the department that the bond or assets required under Code Section 7-1-683
have been increased accordingly. This notice shall be given
quarterly,
within 30 days after the end of each calendar quarter; and, if not given, such
new location will not be considered as included under the licensee´s
license under this article
to the
department by the licensee as follows:
(1)
For the period January 1 through June 30 of each year, on the first business day
of September; and
(2)
For the period July 1 through December 31 of each year, on the first business
day of March.
Failure
to provide such notice shall be punished with a fine, other administrative
action, or both. At any time the
department is shown that a licensee has decreased the number of locations at or
through which it proposes to engage in the business, the department may decrease
the bond or security requirements accordingly."
SECTION
21.
Said
chapter is further amended by revising Code Section 7-1-687, relating to agents
of licensees, as follows:
"7-1-687.
A
licensee may conduct its business at one or more locations in this state, so
long as such locations have been included in the licensee´s application and
reports under Code Sections 7-1-683 and 7-1-686, and through such agents as it
may designate. The department may within ten days after application, for cause,
refuse to approve a licensee´s designation of an agent or, for cause,
suspend a licensee´s designation of an agent. In such cases the agent
shall have the same procedural rights as are provided in this article for the
denial, suspension, or revocation of a licensee´s license. No additional
license other than that obtained by the licensee shall be required of any duly
reported agent of a licensee. An agent of a licensee shall sell or issue checks
only at the location designated in the licensee´s report to the department
or at other locations of which the department
first
has been notified
in
writing."
SECTION
22.
Said
chapter is further amended in Code Section 7-1-689, relating to denial,
suspension, and revocation of license or designation of agent, by revising
subsections (a) and (b) as follows:
"(a)
The department may suspend or revoke an original or renewal license or the
designation of an agent of a licensee on any ground on which it might refuse to
issue an original license or for a violation of any provision of this article or
any rule or regulation issued under this article or for failure of the licensee
to pay, within 30 days after it becomes final, a judgment recovered in any court
within this state by a claimant or creditor in an action arising out of the
licensee´s business in this state of selling or issuing checks.
If a cease and
desist order is issued by the department to a licensee who has been sent a
notice of bond cancellation and if the required bond is reinstated or replaced
and such documentation is delivered to the department within the 30 day period
following the date of issuance of the order, the order shall be rescinded. If
the notice of reinstatement of the bond is not received by the department within
the 30 days, the license shall expire at the end of the 30 day period and the
licensee shall be required to make a new application for a license and pay all
applicable fees.
(b)
No
application for a license under this article shall be denied and no license
granted under this article shall be suspended or revoked unless the applicant or
licensee is given a reasonable opportunity to be heard by the department. For
this purpose the department shall give the applicant or licensee at least 20
days´ written notice of the time and place of such hearing by registered or
certified mail or statutory overnight delivery addressed to the principal place
of business of such applicant or licensee. Any order of the department denying,
suspending, or revoking a license shall state the grounds upon which it is based
and shall not be effective for 20 days after its rendition. A copy thereof shall
be forwarded promptly by registered or certified mail or statutory overnight
delivery addressed to the principal place of business of such applicant or
licensee.
Notice of the
department´s intention to enter an order denying an application for a
license under this article or of an order suspending or revoking a license under
this article shall be given to the applicant or licensee in writing, sent by
registered or certified mail or statutory overnight delivery addressed to the
principal place of business of such applicant or licensee. Within 20 days of
the date of the notice of intention to enter an order of denial, suspension, or
revocation under this article, the applicant or licensee may request in writing
a hearing to contest the order. If a hearing is not requested in writing within
20 days of the date of such notice of intention, the department shall enter a
final order regarding the denial, suspension, or revocation. Any final order of
the department denying, suspending, or revoking a license shall state the
grounds upon which it is based and shall be effective on the date of issuance. A
copy thereof shall be forwarded promptly by registered or certified mail or
statutory overnight delivery addressed to the principal place of business of
such applicant or licensee. If a person refuses to accept service of the notice
or order by registered or certified mail or statutory overnight delivery, the
notice or order shall be served by the commissioner or the commissioner´s
authorized representative under any other method of lawful service; and the
person shall be personally liable to the commissioner for a sum equal to the
actual costs incurred to serve the notice or order. This liability shall be
paid upon notice and demand by the commissioner or the commissioner´s
representative and shall be assessed and collected in the same manner as other
fees or fines administered by the
commissioner."
SECTION
23.
Said
chapter is further amended in Code Section 7-1-689.1, relating to issuance of
cease and desist order for noncompliance by licensee, by revising subsections
(a), (b), (c), and (e) as follows:
"(a)
Whenever it shall appear to the department that any person
required to
be licensed or registered under this
article has violated any law of this state
or any order or regulation of the department
under this
article or is operating without a required
license, the department may issue an initial written order requiring such person
to cease and desist immediately from such unauthorized practices. Such cease
and desist order shall be final 20 days after it is issued unless the person to
whom it is issued makes a written request for a hearing within such 20 day
period. The hearing shall be conducted in accordance with Chapter 13 of Title
50, the 'Georgia Administrative Procedure Act.' A cease and desist order issued
to an unlicensed person that orders such person to cease doing business without
the appropriate license shall be final 30 days from the date of issuance and
there shall be no opportunity for an administrative hearing. If the proper
license or evidence of exemption for the time period cited in the order is
obtained within the 30 day period, the order shall be rescinded by the
department.
Any cease and
desist order sent to the person at both his or her personal and business
addresses pursuant to this Code section that is returned to the department as
'refused' or 'unclaimed' shall be deemed as received and sufficiently
served.
(b)
Whenever a person
required to
be licensed under this article shall fail
to comply with the terms of an order of the department which has been properly
issued under the circumstances, the department may, through the Attorney General
and upon notice of three days to such person, petition the principal court for
an order directing such person to obey the order of the department within the
period of time as shall be fixed by the court. Upon the filing of such petition
the court shall allow a motion to show cause why it should not be granted.
After a hearing upon the merits or after failure of such person to appear when
ordered, the court shall grant the petition of the department upon a finding
that the order of the department was properly issued.
(c)
Any person
required to
be licensed under this article who
violates the terms of any order issued pursuant to this Code section shall be
liable for a civil penalty not to exceed $1,000.00. Each day the violation
continues shall constitute a separate offense. In determining the amount of a
penalty, the department shall take into account the appropriateness of the
penalty relative to the size of the financial resources of such person, the good
faith efforts of such person to comply with the order, the gravity of the
violation, the history of previous violations by such person, and such other
factors or circumstances as shall have contributed to the violation. The
department may at its discretion compromise, modify, or refund any penalty which
is subject to being imposed or has been imposed pursuant to this Code section.
Any person assessed pursuant to this subsection shall have the right to request
a hearing into the matter within ten days after notification of the assessment
has been served upon the licensee involved; otherwise, such penalty shall be
final except as to judicial review as provided in Code Section
7-1-90."
"(e)
For purposes of this Code section, the term 'person' includes
any
an individual,
any entity required to be licensed, and a
licensee, officer, director, employee,
agent, or other person participating in the conduct of the affairs of the person
subject to the orders issued pursuant to this Code section."
SECTION
24.
Said
chapter is further amended in Code Section 7-1-692, relating to prohibited
transactions, by adding a new subsection to read as follows:
"(c)
No person required to be licensed under this article shall purposely withhold,
delete, destroy, or alter information requested by an examiner or other official
of the department or make false statements or material misrepresentations to the
department."
SECTION
25.
Said
chapter is further amended by revising Code Section 7-1-700, relating to
definitions relevant to check cashers, as follows:
"7-1-700.
As
used in this article, the term:
(1)
'Check casher' means an individual, partnership, association, or corporation
engaged in cashing checks, money orders, or other drafts for a fee. Such fee
may be payable in cash, in the form of exchange of value in excess of regular
retail value, in the form of mandatory purchase of goods or services by patrons
on a
regular basis, which shall mean the check casher conducts such services more
than ten times in any calendar month, or
in the form of the purchase of catalog items or coupons or other items
indicating the ability to receive goods, services, or catalog
items.
(2)
'Licensed casher of checks' means any individual, partnership, association, or
corporation duly licensed by the Department of Banking and Finance to engage in
business pursuant to the provisions of this article.
(3)
'Licensee' means a licensed casher of checks, drafts, or money
orders.
(4)
'Registered casher of checks' or 'registrant' means any individual, partnership,
association, or corporation engaged in cashing checks, money orders, or other
drafts for a fee limited to the greater of $2.00 or 2 percent of the face amount
of the check. Such fee may be payable in cash, in the form of exchange of value
in excess of regular retail value, in the form of mandatory purchase of goods or
services by patrons, or in the form of the purchase of catalog items or coupons
or other items indicating the ability to receive goods, services, or catalog
items. A registered casher of checks shall not advertise its check cashing
services and shall be duly registered by the Department of Banking and Finance
to engage in business pursuant to the provisions of this
article."
SECTION
26.
Said
chapter is further amended by revising Code Section 7-1-701, relating to
licensure of check cashers, as follows:
"7-1-701.
(a)
No person, partnership, association, or corporation shall engage in the business
of cashing checks, drafts, or money orders for a consideration without first
obtaining a license
or
registration under this article. The term
'consideration' shall include any premium charged for the sale of goods in
excess of the cash price of such goods.
(b)
Each application for a license
or
registration shall be in writing and under
oath to the department, in such form as the department may prescribe, and shall
include the following:
(1)
The legal name, residence, and business address of the applicant and, if the
applicant is a partnership, association, or corporation, of every member,
officer, and director thereof;
(2)
The location where the initial registered office of the applicant will be
located in this state;
(3)
The complete address of any other locations at which the applicant proposes to
engage in cashing checks; and
(4)
Such other data, financial statements, and pertinent information as the
department may require with respect to the applicant, its directors, trustees,
officers, members, or agents.
(c)
The application
for license or
registration shall be filed together with
an investigation and supervision fee established by regulation which shall not
be refundable but which, if the license
or
registration is granted, shall satisfy the
fee requirement for the first
license
licensed or
registered year or the remaining part
thereof."
SECTION
27.
Said
chapter is further amended by revising Code Section 7-1-702, relating to
background investigation of applicants for check casher's licenses, as
follows:
"7-1-702.
(a)
The department shall conduct an investigation of every applicant
for license or
registration to determine the financial
responsibility, experience, character, and general fitness of the applicant. If
the department determines to its general satisfaction:
(1)
That the applicant is financially responsible and appears to be able to conduct
the business of cashing checks in an honest, fair, and efficient manner and with
the confidence and trust of the community; and
(2)
That the granting of such application will promote the convenience and advantage
of the area in which the business is to be conducted,
the
department shall issue the applicant a license
or
registration to engage in the business of
cashing checks.
(b)
The department shall not issue such a license
or
registration or may revoke a license or
registration if it finds that the
applicant,
licensee, or
registrant or any person who is a
director, officer, partner, agent, employee, or
substantial
stockholder of the applicant,
ultimate
equitable owner of 10 percent or more of the applicant, licensee, or registrant
or any individual who directs the affairs or establishes policy for the
applicant, licensee, or registrant has
been convicted of a felony involving moral turpitude in any jurisdiction or of a
crime which, if committed within this state, would constitute a felony involving
moral turpitude under the laws of this state. For the purposes of this article,
a person shall be deemed to have been convicted of a crime if such person shall
have pleaded guilty to a charge thereof before a court or federal magistrate or
shall have been found guilty thereof by the decision or judgment of a court or
federal magistrate or by the verdict of a jury, irrespective of the
pronouncement of sentence or the suspension thereof, unless such plea of guilty
or such decision, judgment, or verdict shall have been set aside, reversed, or
otherwise abrogated by lawful judicial process and regardless of whether first
offender treatment without adjudication of guilt pursuant to the charge was
entered, unless and until such plea of guilty or such decision, judgment, or
verdict shall have been set aside, reversed, or otherwise abrogated by lawful
judicial process or until probation, sentence, or both probation and sentence of
a first offender have been successfully completed and documented or unless the
person convicted of the crime shall have received a pardon therefor from the
President of the United States or the governor or other pardoning authority in
the jurisdiction where the conviction was had, or shall have received an
official certification or pardon granted by the State Board of Pardons and
Paroles which removes the legal disabilities resulting from such conviction and
restores civil and political rights in this state.
The term
'substantial stockholder' as used in this subsection shall be deemed to refer to
a person owning or controlling 10 percent or more of the total outstanding stock
of the corporation in which such person is a stockholder.
(c)
The department shall be authorized to obtain conviction data with respect to any
applicant,
licensee, or registrant or any person who
is a director, officer, partner, agent, employee, or ultimate equitable owner of
10 percent or more of the
applicant,
licensee, or registrant or any individual who directs the affairs or establishes
policy for the applicant, licensee, or
registrant. Upon receipt of information
from the Georgia Crime Information Center that is incomplete or that indicates
an applicant,
licensee, or registrant or any person who
is a director, officer, partner, agent, employee, or ultimate equitable owner of
10 percent or more of the
applicant,
licensee, or registrant or any individual who directs the affairs or establishes
policy for the applicant, licensee, or
registrant has a criminal record in a
state other than Georgia, the department shall submit to the Georgia Crime
Information Center two complete sets of fingerprints of such applicant or such
person, the required records search fees, and such other information as may be
required.
Fees for
background checks that the department administers shall be submitted to the
department by applicants, licensees, or registrants together with two complete
sets of fingerprints. Upon receipt
thereof, the Georgia Crime Information Center shall promptly transmit one set of
fingerprints to the Federal Bureau of Investigation for a search of bureau
records and an appropriate report and shall retain the other set and promptly
conduct a search of its own records and records to which it has access. The
Georgia Crime Information Center shall notify the department in writing of any
derogatory finding, including, but not limited to, any conviction data regarding
the fingerprint records check, or if there is no such finding. All conviction
data received by the department shall be used by the department for the
exclusive purpose of carrying out its responsibilities under this article, shall
not be a public record, shall be privileged, and shall not be disclosed to any
other person or agency except to any person or agency which otherwise has a
legal right to inspect the file. All such records shall be maintained by the
department pursuant to laws regarding such records and the rules and regulations
of the Federal Bureau of Investigation and the Georgia Crime Information Center,
as applicable. As used in this subsection, 'conviction data' means a record of
a finding, verdict, or plea of guilty or a plea of nolo contendere with regard
to any crime, regardless of whether an appeal of the conviction has been
sought.
(d)
Such license shall be kept conspicuously posted in the place of business of the
licensee. Such license shall not be transferable or assignable.
(e)
A license issued pursuant to this article shall remain in force and effect
through its expiration date unless earlier surrendered, suspended, or revoked
pursuant to this article.
(d)
Every applicant, licensee, and registrant shall be authorized and required to
obtain and maintain the results of background checks on employees working in the
licensed business. Such background checks shall be handled by the Georgia Crime
Information Center pursuant to Code Section 35-3-34 and the rules and
regulations of the Georgia Crime Information Center. Applicants, licensees, and
registrants shall be responsible for any applicable fees charged by the Georgia
Crime Information Center. An applicant, licensee, or registrant may only employ
a person whose background data has been checked and been found to be
satisfactory prior to the initial date of hire. This provision does not apply
to directors, officers, partners, agents, or ultimate equitable owners of 10
percent or more or to persons who direct the company´s affairs or establish
policy, whose background must have been investigated through the department
before taking office, beginning employment, or securing ownership. Upon receipt
of information from the Georgia Crime Information Center that is incomplete or
that indicates an employee has a criminal record in any state other than
Georgia, the employer shall submit to the department two complete sets of
fingerprints for such person, together with the applicable fees and any other
required information. The department shall submit such fingerprints as provided
in subsection (c) of this Code section.
(e)
Such license or registration shall be kept conspicuously posted in the place of
business of the licensee or registrant. Such license or registration shall not
be transferable, assignable, or subject to a change of ownership without prior
application to and approval by the department.
(f)
Except as otherwise specifically provided in this article, all licenses and
registrations issued pursuant to this article shall expire on September 30 of
each year, and application for renewal shall be made annually on or before
August 1 of each year. Any new license or registration granted after July 1 in
any year will not be required to be renewed until the next calendar year renewal
period."
SECTION
28.
Said
chapter is further amended in Code Section 7-1-704, relating to rules and
regulations for enforcement of article and the examination of books and records
of licensees, by revising subsections (b) through (d) as follows:
"(b)
To assure compliance with the provisions of this article and in consideration of
any application to renew a license
or
registration pursuant to the provisions of
Code Section 7-1-703, the department or its designated agent may examine the
books and records of any licensee
or
registrant to the same extent as it is
authorized to examine financial institutions under this chapter. Each licensee
or
registrant shall pay an examination fee as
established by regulations of the department to cover the cost of such
examination.
(c)
To assure compliance with the provisions of this article, the department may
review the fees charged and fee income of any person cashing checks for a fee
who claims exemption from licensing
or claims to
be a registered casher of checks. Each
person
claiming
exemption who is reviewed shall pay an
hourly fee as provided in departmental regulations when the review requires more
than four examiner hours and the review results in a finding that a license
or
registration is required. The department,
in its discretion, may permit the party claiming exemption
or
registration to supply to the department
the necessary books and records for its review at department
headquarters.
(d)
The department shall remit all examination fees paid by licensees
and
registrants in accordance with Code
Section 7-1-43, net of any cost paid to third parties authorized by the
department to perform such examination services."
SECTION
29.
Said
chapter is further amended by revising Code Section 7-1-705, relating to notice
to be posted by licensee, record-keeping requirements, and check cashing
procedures, as follows:
"7-1-705.
(a)
In every location licensed
or
registered under this article, there shall
be conspicuously posted and at all times displayed a notice stating the charges
for cashing checks.
(b)
Each licensee
or
registrant shall keep and use in its
business such books, accounts, and records as the department may require to
carry into effect the provisions of this article and the rules and regulations.
Every licensee
or
registrant shall preserve such books,
accounts, and records for at least two years.
(c)
Before a licensee
or
registrant shall deposit with any bank a
check, draft, or money order cashed by such licensee
or
registrant, the same must be endorsed with
the actual name under which such licensee
or
registrant is doing business.
(d)(1)
No licensee or
registrant shall receive any check, draft,
or money order with payment deferred pending collection. Payment shall be made
immediately in cash for every check, draft, or money order accepted by the
licensee or
registrant.
(2)
Notwithstanding the provisions of paragraph (1) of this subsection, drafts may
be accepted for collection with payment deferred where the licensee
or
registrant has posted a surety bond in the
same manner as prescribed for check sales licensees under Code Section 7-1-683.
The amount of the surety bond shall be $10,000.00 for each location operated by
the licensee
or
registrant if the licensee
or
registrant operates three or fewer
locations. For a fourth or fifth location operated by a licensee
or
registrant, the amount of the surety bond
shall be $5,000.00 for each such location. For each location operated by a
licensee or
registrant in excess of a fifth location,
the amount of the surety bond shall be $1,000.00. In no event shall payment of
a draft be deferred past the time that the licensee
or
registrant has collected on the draft.
Upon collection, payment shall be made immediately to the party from whom the
licensee or
registrant accepted the
draft.
(e)
No licensee or
registrant shall cash a check, draft, or
money order made payable to a payee other than a natural person unless such
licensee or
registrant has previously obtained
appropriate documentation from the executive entity of such payee clearly
indicating the authority of the natural person or persons cashing the check,
draft, or money order on behalf of the payee.
(f)
No licensee
shall
indicate through advertising, signs, billhead, or otherwise that checks may be
cashed
or registrant
shall cash checks without identification
of the bearer of such check, and any person seeking to cash a check shall be
required to submit such reasonable identification as shall be prescribed by the
department; provided, however, the provisions of this subsection shall not
prohibit a licensee
or
registrant from cashing a check
simultaneously with the verification and establishment of the identity of the
presenter by means other than the presentation of identification.
(g)
Within five business days after being advised by the payor financial institution
that a check, draft, or money order has been altered, forged, stolen, obtained
through fraudulent or illegal means, negotiated without proper legal authority,
or represents the proceeds of illegal activity, the licensee
or
registrant shall notify the department and
the district attorney for the judicial circuit in which the check was received.
In the event a check, draft, or money order is returned to the licensee
or
registrant by the payor financial
institution for any of the aforementioned reasons, the licensee
or
registrant may not release the check,
draft, or money order without the consent of the district attorney or other
investigating law enforcement authority."
SECTION
30.
Said
chapter is further amended in Code Section 7-1-706, relating to check-cashing
fees, by designating the existing text as subsection (a) and by adding a new
subsection to read as follows:
"(b)
No registered casher of checks shall charge check-cashing fees, except as
otherwise provided in this Code section, in excess of 2 percent of the face
amount of the check or draft or $2.00, whichever is greater."
SECTION
31.
Said
chapter is further amended by revising Code Section 7-1-707, relating to
suspension or revocation of check casher's license, as follows:
"7-1-707.
(a)
The department may suspend or revoke any
licenses
or license
or
registration issued pursuant to this
article if,
after notice and a hearing:
(1)
It shall find that the licensee
or registrant
has:
(A)
Has
committed
Committed
any fraud, engaged in any dishonest activities, or made any
misrepresentation;
(B)
Has
violated
Violated
any provisions of the banking law or any regulation issued pursuant thereto or
has violated any other law in the course of
its or
his
its, his, or
her dealings as a licensed
or
registered casher of checks;
(C)
Has
made
Made
a false statement in the application for such license
or
registration or failed to give a true
reply to a question in such application;
(D)
Has
demonstrated his
Demonstrated
his, her, or its incompetency or
untrustworthiness to act as a licensed
or
registered casher of checks;
or
(E)
Purposely withheld, deleted, destroyed, or altered information requested by an
examiner of the department or made false statements or material
misrepresentations to the department; or
(E)(F)
Has
charged
Charged
check-cashing fees, exclusive of direct costs of verification, in unconscionable
amounts which do not adequately reflect:
(i)
The level of risk associated with the cashing of checks of a particular class
using ordinary prudence and commercially reasonable standards of identification
and acceptance;
(ii)
The cost of funds necessary to operate a check-cashing business;
and
(iii)
The extraordinary costs for security safeguards associated with the business
location of the licensee
or
registrant; or
(2)
It shall find that any ground or grounds exist which would require or warrant
the refusal of an application for the issuance of the license if such an
application were then before it.
(b)
No
application for a license under this article shall be denied and no license
granted under this article shall be suspended or revoked unless the applicant or
licensee is given a reasonable opportunity to be heard by the department. For
this purpose, the department shall give the applicant or licensee at least 20
days´ written notice of the time and place of such hearing by registered or
certified mail or statutory overnight delivery addressed to the principal place
of business of such applicant or licensee. A copy of such notice of hearing
shall be mailed to any association of licensees registered with the department
for the purpose of receiving such notices, and such association shall be
permitted to participate in the hearing, either on behalf of the applicant or in
opposition to the application. Any order of the department denying, suspending,
or revoking a license shall state the grounds upon which it is based and shall
not be effective for 20 days after its rendition. A copy thereof shall be
forwarded promptly by registered or certified mail or statutory overnight
delivery addressed to the principal place of business of such applicant or
licensee.
Notice of the
department´s intention to enter an order denying an application for a
license or registration under this article or of an order suspending or revoking
a license or registration under this article shall be given to the applicant,
licensee, or registrant, in writing, sent by registered or certified mail or
statutory overnight delivery addressed to the principal place of business of
such applicant, licensee, or registrant. Within 20 days of the date of the
notice of intention to enter an order of denial, suspension, or revocation under
this article, the applicant, licensee, or registrant may request in writing a
hearing to contest the order. If a hearing is not requested in writing within
20 days of the date of such notice of intention, the department shall enter a
final order regarding the denial, suspension, or revocation. Any final order of
the department denying, suspending, or revoking a license or registration shall
state the grounds upon which it is based and shall be effective on the date of
issuance. A copy thereof shall be forwarded promptly by registered or certified
mail or statutory overnight delivery addressed to the principal place of
business of such applicant, licensee, or registrant. If a person refuses to
accept service of the notice or order by registered or certified mail or
statutory overnight delivery, the notice or order shall be served by the
commissioner or the commissioner´s authorized representative under any
other method of lawful service; and the person shall be personally liable to the
commissioner for a sum equal to the actual costs incurred to serve the notice or
order. This liability shall be paid upon notice and demand by the commissioner
or the commissioner´s representative and shall be assessed and collected in
the same manner as other fees or fines administered by the
commissioner.
(c)
A decision of the department denying a license
or
registration, original or renewal, shall
be conclusive, except that it may be subject to judicial review under Code
Section 7-1-90. A decision of the department suspending or revoking a license
or
registration shall be subject to judicial
review in the same manner as a decision of the department to take possession of
the assets and business of a bank under Code Section 7-1-155.
(d)
The provisions of this Code section shall not apply when a license is denied or
suspended as provided in Code Section 7-1-707.1.
(e)(1)
Whenever it shall appear to the department that any person
required to
be licensed or registered under this
article has violated any law of this state
or any order or regulation of the department
under this
article, the department may issue an
initial written order requiring such person to cease and desist immediately from
such unauthorized practices. Such cease and desist order shall be final 20 days
after it is issued unless the person to whom it is issued makes a written
request within such 20 day period for a hearing. The hearing shall be conducted
in accordance with Chapter 13 of Title 50, the 'Georgia Administrative Procedure
Act.' A cease and desist order to an unlicensed
or
unregistered person that orders such
person to cease doing a check-cashing business without the appropriate license
or
registration shall be final 30 days from
the date of issuance, and there shall be no opportunity for an administrative
hearing. If the proper license
or
registration or evidence of exemption is
obtained within the 30 day period, the order shall be rescinded by the
department.
Any cease and
desist order sent to the person at both his or her personal and business
addresses pursuant to this Code section that is returned to the department as
'refused' or 'unclaimed' shall be deemed as received and sufficiently
served.
(2)
Whenever a person
required to
be licensed under this article shall fail
to comply with the terms of an order of the department which has been properly
issued under the circumstances, the department, upon notice of three days to
such person, may, through the Attorney General, petition the principal court for
an order directing such person to obey the order of the department within the
period of time as shall be fixed by the court. Upon the filing of such petition,
the court shall allow a motion to show cause why it should not be granted.
Whenever, after a hearing upon the merits or after failure of such person to
appear when ordered, it shall appear that the order of the department was
properly issued, the court shall grant the petition of the
department.
(3)
Any person
required to
be licensed under this article who
violates the terms of any order issued pursuant to this Code section shall be
liable for a civil penalty not to exceed $1,000.00. Each day the violation
continues shall constitute a separate offense. In determining the amount of
penalty, the department shall take into account the appropriateness of the
penalty relative to the size of the financial resources of such person, the good
faith efforts of such person to comply with the order, the gravity of the
violation, the history of previous violations by such person, and such other
factors or circumstances as shall have contributed to the violation. The
department may at its discretion compromise, modify, or refund any penalty which
is subject to imposition or has been imposed pursuant to this Code section. Any
person assessed as provided in this subsection shall have the right to request a
hearing into the matter within ten days after notification of the assessment has
been served upon the licensee
or
registrant involved; otherwise, such
penalty shall be final except as to judicial review as provided in Code Section
7-1-90.
(4)
Initial judicial review of the decision of the department entered pursuant to
this Code section shall be available solely in the superior court of the county
of domicile of the department.
(5)
For purposes of this Code section, the term 'person' includes
any
an individual,
any entity required to be licensed or registered, licensees, registrants, or
an officer, director, employee, agent, or
other person participating in the conduct of the affairs of the person subject
to the orders issued pursuant to this Code section.
(6)
In addition to any other administrative penalties authorized by this article,
the department may, by regulation, prescribe administrative fines for violations
of this article and of any rules promulgated by the department pursuant to this
article."
SECTION
32.
Said
chapter is further amended in Code Section 7-1-709, relating to applicability of
article, by striking subsection (c) in its entirety and by revising subsection
(b) in its entirety as follows:
"(b)
This article shall not apply to any individual, partnership, association, or
corporation which cashes checks for which no fee is charged."
SECTION
33.
Said
chapter is further amended in Code Section 7-1-1001, relating to exemption for
certain persons and entities from obtaining a mortgage broker or mortgage lender
license, by revising paragraph (13) as follows:
"(13)
Any natural person who makes five or fewer mortgage loans in any one calendar
year. A person other than a natural person who makes five or fewer mortgage
loans in any one calendar year shall not be exempt from the licensing
requirements of this article
unless such
person applies for and is granted an exemption by the department in accordance
with regulations promulgated by the
department; or"
SECTION
34.
Said
chapter is further amended in Code Section 7-1-1004, relating to investigation
of applicant for mortgage broker license, by revising subsections (f) and (i) as
follows:
"(f)
Every licensee and applicant shall be authorized and required to obtain
background checks on covered employees. Such background checks shall be handled
by the Georgia Crime Information Center pursuant to Code Section 35-3-34 and the
rules and regulations of the Georgia Crime Information Center. Licensees and
applicants shall be responsible for any applicable fees charged by the center.
An
applicant or licensee may employ a person whose background must be checked and
has 90 days from the initial date of hire to obtain satisfactory background
data.
A background
check must be initiated for a person in the employ of a licensee or applicant
within ten days of the date of initial hire and be completed with satisfactory
results within the first 90 days of
employment. This provision does not apply
to directors, officers, partners, agents, or ultimate equitable owners of 10
percent or more or to persons who direct the company´s affairs or establish
policy, whose background must have been investigated through the department
before taking office, beginning employment, or securing ownership. Upon receipt
of information from the Georgia Crime Information Center that is incomplete or
that indicates an employee has a criminal record in any state other than
Georgia, the employer shall submit to the department two complete sets of
fingerprints of such person, together with the applicable fees and any other
required information. The department shall submit such fingerprints as provided
in subsection (e) of this Code section."
"(i)
The department may not issue a license to and may revoke a license from an
applicant or licensee if such person employs any other person against whom a
final cease and desist order has been issued within the preceding
three
five
years, if such order was based on a violation of Code Section 7-1-1013 or based
on the conducting of a mortgage business without a required license, or whose
license has been revoked within
three
five
years of the date such person was hired. Each applicant and licensee shall,
before hiring an employee, examine the department´s public records to
determine that such employee is not subject to the type of cease and desist
order described in this subsection."
SECTION
35.
Said
chapter is further amended in Code Section 7-1-1006, relating to contents of a
mortgage broker´s license and posting requirements, by revising subsections
(e) and (f) as follows:
"(e)
Each licensee shall notify the department in writing of any change in the
address of the principal place of business or of any additional location of
business in Georgia, any change in registered agent or registered office, any
change of
principal
executive
officer,
director,
contact person for consumer complaints, or ultimate equitable owner of 10
percent or more of any corporation or other entity licensed under this article,
or of any material change in the licensee´s financial statement.
Notice of a
change in address of the main office or an approved branch location shall be
submitted no later than 15 days before the change is
made. Notice of
other
changes must be received by the department no later than 30 business days after
the change is effective.
(f)
No licensee shall open a new additional office in Georgia without prior approval
of the department. Applications for such additional office shall be made in
writing on a form prescribed by the department and shall be accompanied by
payment of a $350.00 nonrefundable application fee. The application shall be
approved unless the department finds that the applicant has not conducted
business under this article efficiently, fairly, in the public interest, and in
accordance with law. The application shall be deemed approved if notice to the
contrary has not been mailed by the department to the applicant within
30
45
days of the date the application is received by the
department."
SECTION
36.
Said
chapter is further amended in Code Section 7-1-1008, relating to acquisition of
25 percent or more of the voting shares or of the ownership of any other entity
licensed to conduct business under the mortgage lenders and mortgage brokers
article, is revised in the introductory language of subsection (a) as
follows:
"(a)
Except as provided in this Code section,
on and
after July 1, 1993, no person shall
acquire directly or indirectly
25
10
percent or more of the voting shares of a corporation or
25
10
percent or more of the ownership of any other entity licensed to conduct
business under this article unless it first:"
SECTION
37.
Said
chapter is further amended in Code Section 7-1-1009, relating to maintenance of
books, accounts, and records; and investigation and examination of licensees and
registrants by the department, by revising subsection (a) and the introductory
language of subsection (f) as follows:
"(a)
Any person required to be licensed or registered under this article shall
maintain at its offices or such other location as the department shall permit
such books, accounts, and records as the department may reasonably require in
order to determine whether such person is complying with the provisions of this
article and rules and regulations adopted in furtherance thereof. Such books,
accounts, and records shall be maintained
apart and
separate from any other business in which
such
separately and
distinctly from any other personal or unrelated business matters in which
the person is involved."
"(f)
Examinations and investigations conducted under this article and information
obtained by the department in the course of its duties under this article are
confidential, except as provided in this subsection, pursuant to the provisions
of Code Section 7-1-70. In addition to the exceptions set forth in subsection
(b) of Code Section 7-1-70 and in paragraphs (3) and (4) of subsection (c) of
this Code section, the department is authorized to share information obtained
under this article with other state and federal regulatory agencies or law
enforcement authorities. In the case of such sharing, the safeguards to
confidentiality already in place within such agencies or authorities shall be
deemed adequate. The commissioner or an examiner specifically designated may
disclose such limited information as is necessary to conduct a civil or
administrative investigation or proceeding. The department shall compile
information on the number of written complaints received on all licensees.
Beginning
August 1, 2001, and at least annually thereafter, the department
shall
The department
shall annually disclose to the public the
number of such complaints together with the number of Georgia residential
mortgage loans made during the same period. In preparing the disclosure, the
department shall be authorized to rely upon the number of mortgage loans
reported to it in the mortgage license renewal application. Information
contained in the records of the department which is not confidential and may be
made available to the public either on the department´s website or upon
receipt by the department of a written request shall include:"
SECTION
38.
Said
chapter is further amended in Code Section 7-1-1016, relating to regulations
relative to advertising, by revising paragraphs (1) and (2) as
follows:
"(1)(A)
Advertisements for loans regulated under this article may not be false,
misleading, or deceptive. No person whose activities are regulated under this
article may advertise in any manner so as to indicate or imply that its interest
rates or charges for loans are in any way 'recommended,' 'approved,' 'set,' or
'established' by the state or this article;
(B)
An advertisement shall not include an individual´s loan number, loan
amount, or other publicly available information unless it is clearly and
conspicuously stated in bold-faced type at the beginning of the advertisement
that the person disseminating it is not authorized by, in sponsorship with, or
otherwise affiliated with the individual´s lender, which shall be
identified by name. Such an advertisement shall also state that the loan
information contained therein was not provided by the recipient´s
lender.
(2)
All advertisements disseminated
by a licensee
or a registrant in this state by
a licensee
or a registrant
any
means shall contain the name, license
number, and an office address of such licensee or registrant, which shall
conform to a name and address on record with the department;
and"
SECTION
39.
Said
chapter is further amended in Code Section 7-1-1017, relating to suspension or
revocation of licenses of mortgage lenders or mortgage brokers, by revising
paragraph (1) of subsection (a) and subsection (b) as follows:
"(a)(1)
The department may suspend or revoke an original or renewal
license or
registration
license,
registration, or mortgage broker education
approval on any ground on which it might
refuse to issue an original
license or
registration
license,
registration, or approval or for a
violation of any provision of this article or of Chapter 6A of this title or any
rule or regulation issued under this article or under Chapter 6A of this title,
including failure to provide fees on a timely basis, or for failure of the
licensee or registrant to pay, within 30 days after it becomes final, a judgment
recovered in any court within this state by a claimant or creditor in an action
arising out of the licensee´s or registrant´s business in this state
as a mortgage lender or mortgage broker or for violation of a final order
previously issued by the department."
"(b)
Notice of the department´s intention to enter an order denying an
application for a license or registration under this article or of an order
suspending or revoking a license or registration under this article shall be
given to the applicant, licensee, or registrant in writing, sent by registered
or certified mail or statutory overnight delivery addressed to the principal
place of business of such applicant, licensee, or registrant. Within 20 days of
the date of the notice of intention to enter an order of denial, suspension, or
revocation under this article, the applicant, licensee, or registrant may
request in writing a hearing to contest the order. If a hearing is not
requested in writing within 20 days of the date of such notice of intention, the
department shall enter a final order regarding the denial, suspension, or
revocation. Any final order of the department denying, suspending, or revoking
a license or registration shall state the grounds upon which it is based and
shall be effective on the date of issuance. A copy thereof shall be forwarded
promptly by registered or certified mail or statutory overnight delivery
addressed to the principal place of business of such applicant, licensee, or
registrant.
If a person
refuses to accept service of the notice or order by registered or certified mail
or statutory overnight delivery, the notice or order shall be served by the
commissioner or the commissioner´s authorized representative under any
other method of lawful service; and the person shall be personally liable to the
commissioner for a sum equal to the actual costs incurred to serve the notice or
order. This liability shall be paid upon notice and demand by the commissioner
or the commissioner´s representative and shall be assessed and collected in
the same manner as other fees or fines administered by the
commissioner."
SECTION
40.
Said
chapter is further amended in Code Section 7-1-1018, relating to cease and
desist orders against noncompliant mortgage lenders or mortgage brokers, by
revising subsections (a) and (f) as follows:
"(a)
Whenever it shall appear to the department that any person required to be
licensed or registered or required to file a notification statement under this
article or employed by a licensee or registrant pursuant to Code Section
7-1-1001 or who would be covered by the prohibitions in Code Section 7-1-1013
has violated any law of this state or any order or regulation of the department,
the department may issue an initial written order requiring such person to cease
and desist immediately from such unauthorized practices. Such cease and desist
order shall be final 20 days after it is issued unless the person to whom it is
issued makes a written request within such 20 day period for a hearing. The
hearing shall be conducted in accordance with Chapter 13 of Title 50, the
'Georgia Administrative Procedure Act.' A cease and desist order to an
unlicensed person that orders them to cease doing a mortgage business without
the appropriate license shall be final 30 days from the date of issuance, and
there shall be no opportunity for an administrative hearing. If the proper
license or evidence of exemption or valid employment status during the time of
the alleged offense is delivered to the department within the 30 day period, the
order shall be rescinded by the department. If a cease and desist order is
issued to a person who has been sent a notice of bond cancellation and if the
bond is reinstated or replaced and such documentation is delivered to the
department within the 30 day period following the date of issuance of the order,
the order shall be rescinded. If the notice of reinstatement of the bond is not
received within the 30 days, the license shall expire at the end of the 30 day
period and the person shall be required to make a new application for license
and pay the applicable fees. In the case of an unlawful purchase of mortgage
loans, such initial cease and desist order to a purchaser shall constitute the
knowledge required under subsection (b) of Code Section 7-1-1002 for any
subsequent violations.
Any cease and
desist order sent to the person at both his or her personal and business
addresses pursuant to this Code section that is returned to the department as
'refused' or 'unclaimed' shall be deemed as received and sufficiently
served."
"(f)
For purposes of this Code section, the term 'person'
also
includes any officer, director, employee, agent, or other person participating
in the conduct of the affairs of the person subject to the orders issued
pursuant to this Code section."
SECTION
41.
This
Act shall become effective on July 1, 2007.
SECTION
42.
All
laws and parts of laws in conflict with this Act are repealed.