CHAPTER 287

BANKS, SAVINGS SOCIETIES AND TRUST COMPANIES LICENSED CASHERS OF CHECKS

AN ACT TO AMEND CHAPTER 66 OF THE REVISED CODE OF DELAWARE, 1935, AS AMENDED, ENTITLED, "BANKS, SAVINGS SOCIETIES AND TRUST COMPANIES", BY ADDING A NEW ARTICLE TO SAID CHAPTER, TO BE DESIGNATED ARTICLE 11, WITH REFERENCE TO LICENSED CASHERS OF CHECKS BY REGULATING THE BUSINESS OF SUCH CASHERS OF CHECKS AND PRESCRIBING THE DUTIES AND AUTHORITY OF THE STATE BANK COMMISSIONER WITH RESPECT THERETO.

Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met:

Section 1.:That Chapter 66 of the Revised Code of Delaware; 1935, as amended, be and the same is hereby further amended by adding at the end of said Chapter 66 a new Article, to be designated Article 11, the Sections of said Article to be numbered 2408A. Sec. 151A. to 2408 I. Sec. 151 I. inclusive, as follows:

LICENSED CASHERS OF CHECKS ARTICLE 11 SUNDRY PROVISIONS

2408A. Sec. 151A. Definitions:--When used in this Article.

1. The term "licensed casher of checks" means any individual, partnership, unincorporated association or corporation duly licensed by the Commissioner to engage in business pursuant to the provisions of this Article.

2. The term "licensee" means a licensed casher of checks, drafts and/or money orders.

3. The term "mobile unit" means any vehicle or other movable means from which the business of cashing checks, drafts or money orders is to be conducted.

4. The term "Commissioner" as used in this Article shall mean State Bank Commissioner of the State of Delaware.

5. The term "limited station" means that the licensee is authorized to carry on his business of cashing checks for the employees of a single and particular business or office, and at a single location at or near such particular business or office site.

2408B. Sec. 151B. License Requirements; Fees; Capital Requirements:

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 from the Commissioner.

2. Application for such license shall be in writing, under oath, and in the form prescribed by the Commissioner, and shall contain the name, and the address both of the residence and place of business, of the applicant, and if the applicant is a co-partnership or association, of every member thereof, and if a corporation, of each officer and director thereof; also, if the business is to be conducted at a specific address, the address at which the business is to be conducted, and if the business is to be conducted from a mobile unit, the Delaware state registration number or other identification of such mobile unit and the area in which the applicant proposes to operate such mobile unit; and also such further information as the Commissioner may require.

Such applicant at the time of making such application shall pay to the Commissioner the sum of Fifty Dollars as a fee for investigating the application and the additional sum of One Hundred Dollars as a license fee for a period terminating on the last day of the current calendar year except that in the event the business is to be conducted from a mobile unit, the fee for investigating the application shall be One Hundred Dollars, and the license fee shall be Two Hundred Dollars; provided, that if the application is filed after June thirtieth in any year such payment shall be one-half of the stated license fee in addition to the said fee for investigation.

4. Every applicant shall prove, in form satisfactory to the Commissioner that he or it has available for the operation of such business, for each location and for each mobile unit specified in the application, liquid assets of at least Five Thousand Dollars, and every licensee shall continuously maintain for the operation of such business for each location and for each mobile unit liquid assets of at least Five Thousand Dollars.

2408C. Sec. 151C. Bond to be Filed with Commissioner:--The applicant shall also at the same time file with the Commissioner a bond to be approved by him in which the applicant shall be the obligor, in the sum of Five Thousand Dollars, with one or more sureties whose liability as such sureties need not exceed the said sum in the aggregate. The said bond shall run to the Commissioner for the use of the State. Such bond shall be conditioned that said obligor will faithfully conform to and abide by the provisions of this Article and of all rules and regulations lawfully made by the Commissioner hereunder, and will pay to the State any and all moneys that may become due or owing to the State from said obligor under and by virtue of the provisions of this Article. One or more recoveries or payments upon such bond shall not cancel or vitiate the bond but it shall remain in full force and effect; provided, however, that if the aggregate amount of all such recoveries or payments shall exceed the sum thereof, the licensee shall be required to furnish a new and additional bond under the provisions and requirements of this Section, in like amount as the original one, which shall be filed with the Commissioner within thirty days after the demand therefor.

2408D, Sec. 151D. Conditions Precedent to Issuing License; Issuance and Filing of License; Posting License:--

1. If the. Commissioner shall find that the financial responsibility, experience, character, and general fitness of the applicant, and of the members thereof if the applicant be a co-partnership or association, and of the officers and directors thereof if the applicant be a corporation, are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly, and efficiently within the purposes of this Article, and if the Commissioner shall find that the granting of such application will promote the convenience and advantage of the area in which such business is to be conducted, and if the Commissioner shall find that the applicant has available for the operation of such business for each location and for each mobile unit specified in the application liquid assets of at least Five Thousand Dollars, he shall thereupon execute a license in duplicate to permit the cashing of checks, drafts and money orders in accordance with the provisions of this Article at the location or in the area specified in such application. The Commissioner shall transmit one copy of such license to the applicant and file another in the office of the department.

2. Such license shall state the name of the licensee; and if the licensee is a co-partnership or association, the names of the members thereof; and if the licensee is a corporation, the date of its incorporation; and if the business is to be conducted at a specific address, the address at which such business is to be conducted; and if the business is to be conducted through the use of a mobile unit, the Delaware state registration number or other identification of such mobile unit and the area in which such mobile unit is authorized to do business.

3. Such license shall be kept conspicuously posted in the place of business of the licensee or, in the case of a mobile unit, upon such mobile unit. Such license shall not be transferable or assignable.

4. Such license issued pursuant to this Chapter shall be for a term expiring on the thirty-first day of December following the date of its issuance, and may be renewed for the ensuing calendar year upon the filing of an application in conformity with Section 151B. and Section 151C. of this Article except no fee shall be charged by the Commissioner for investigating such application. If an application for a renewal license shall have been filed with the Commissioner before January first of any year, the license sought to be renewed shall continue in full force and effect either until the issuance by the Commissioner of the renewal license applied for or until five days after the Commissioner shall have refused to issue such renewal license and shall have given notice of such refusal to the applicant.

5. If the Commissioner shall find that the applicant fails to meet any of the conditions set forth in paragraph one of this Section, he shall not issue such license, and he shall notify the applicant of the denial. If an application is denied or withdrawn, the Commissioner shall, except where the application is for renewal of a license in force as provided in paragraph four of this Section, retain the investigation fee to cover the costs of investigating the application and return the license fee to the applicant.

2408E. Sec. 151E. Restrictions as to Place or Area of Doing Business; Establishment of Stations; Change of Location:--

1. No more than one place of business or one mobile unit shall be maintained under the same license; provided, however, that more than one license may be issued to the same licensee upon compliance with the provisions of this Article for each new license.

2. Any licensed casher of checks may open and maintain, within this State, one or more limited stations for the purpose of cashing checks, drafts or money orders for the particular group or groups specified in the license authorizing each such station. Such stations shall be licensed pursuant to and be subject to all the provisions of this Chapter applicable to licensed cashers of checks, except that no bond shall be required for such a station, the fee for investigating the application for a station shall be Ten Dollars and the annual license fee for each such station shall be Twenty Dollars.

3. A licensee may make a written application to the Commissioner for leave to change his place of business, or in the case of a mobile unit, the area in which such unit is authorized to be operated, stating the reasons for such proposed change. If the Commissioner approves such application he shall issue a new license in duplicate in accordance with the provisions of Section 151D. of this Article, stating the new location of such licensee or, in the case of a mobile unit, the new area in which such mobile unit may be operated.

2408F. Sec. 151F. Regulations:--The Commissioner is hereby authorized and empowered to make such rules and regulations, and such specific rulings, demands, and findings as he may deem necessary for the proper conduct of the business authorized and licensed under and for the enforcement of this Article, in addition hereto and not inconsistent herewith.

2408G. Sec. 151G. Fees and Charges; Posting Schedule; Records:--

1. The licensee shall not charge or collect in fees or charges for cashing a check, draft or money order a sum or sums to exceed one-half of one per centum thereof, or twenty-five cents, whichever is greater. In every location and upon every mobile unit licensed under this Article, there shall be conspicuously posted and at all times displayed, a schedule of fees and charges permitted under this Article.

0. Each licensee shall keep and use in the business such books, accounts, and records as the Commissioner may required to carry into effect the provisions of this Article and the rules and regulations made by the Commissioner hereunder. Every licensee shall preserve such books, accounts and records for at least two years.

2408H. Sec. 151H. Acts Prohibited; Suspension or Revocation of License; Penalties:--

1. No licensee shall engage in the business of making loans of money, credit, goods or things or discounting of notes, bills of exchange, checks, or other evidences of debt pursuant to the provisions of Chapters 66 and 100 of the Revised Code of Delaware, 1935, as amended, nor shall a loan business or the negotiation of loans or the discounting of notes, bills of exchange, checks or other evidences of debt be conducted on the same premises where the licensee is conducting business pursuant to the provisions of this Article. No licensee shall at any time cash or advance any moneys on a post-dated check or draft or engage in the business of transmitting money or receiving money for transmission.

2. The Commissioner may suspend or revoke any license or licenses issued pursuant to this Article if, after notice and a hearing, he shall find that the licensee (a) has committed any fraud, engaged in any dishonest activities or made any misrepresentation; or (b) has 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 dealings as a licensed casher of checks; or (c) has made a material misstatement in the application for such license; or (d) has demonstrated his or its incompetency or untrustworthiness to act as a licensed casher of checks, or if he shall find that any fact or condition exists with relation to the license which, if it had existed at the time of the original application for the license, would have warranted the refusal thereof. Such a hearing shall be held in the manner and upon such notice as may be prescribed by the Commissioner. Pending an investigation or a hearing for the suspension or revocation of any license or licenses issued pursuant to this Article, the Commissioner may temporarily suspend such license or licenses for a period not to exceed thirty days, provided the Commissioner shall find that such a temporary suspension is in the public interest.

3. Whenever the Commissioner shall suspend or revoke a license issued pursuant to this Article, he shall forthwith execute a written order to that effect. The Commissioner shall on the date such order is executed file one copy thereof in the office of the department and serve a second copy thereof on the licensee either personally or by mailing the same to the last known address of such licensee.

4. Any person, partnership, association or corporation and the several members, officers, directors, agents and employees thereof, who shall violate any of the provisions of this Article, shall be guilty of a misdemeanor, and shall be punishable by imprisonment for not more than one year or by a fine of not more than Five Hundred Dollars, or by both such fine and imprisonment.

2408 I. Sec. 151 I. Application of Article:--The provisions of this Article shall not apply when checks, drafts or money orders are cashed without a consideration or charge; nor when checks, drafts or money orders are cashed by any person, partnership, association or corporation as an incident to the conduct of any other lawful business where not more than 10 cents is charged for cashing each check, draft or money order; nor shall the provisions of this Article apply to any national bank, federal reserve bank, or to any person, partnership, association, corporation or other organization doing business under or pursuant to the provisions of the banking law, except a licensee under this Article.

Approved April 14, 1947.