TITLE 5

Banking

Other Businesses Under Jurisdiction of State Banking Department

CHAPTER 27. CASHING OF CHECKS, DRAFTS OR MONEY ORDERS

Subchapter II. License Provisions


No person shall engage in the business of cashing checks, drafts or money orders for a consideration without first obtaining a license from the State Bank Commissioner.

Code 1935, § 2408B; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2711.;

Application for a license required by § 2711 of this title shall be in writing, and in the form prescribed by the State Bank Commissioner, and shall state the name and the address (both of the residence and place of business) of the applicant, and if the applicant is a copartnership or association, of every member thereof, and if a corporation, of each officer and director thereof. If the business is to be conducted at a specific address, the application shall state 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 the mobile unit, and the area in which the applicant proposes to operate the mobile unit. The application shall also contain such further information as the Commissioner requires.

Code 1935, § 2408B; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2712; 80 Del. Laws, c. 225, § 6.;

The applicant, at the time of making the application under § 2712 of this title, shall pay to the State Bank Commissioner the nonrefundable sum of $150 as a fee for investigating the application and the additional sum of $200 as a license fee for a period terminating on the last day of the current calendar year, if the business is not to be conducted from a mobile unit; but if the business is to be conducted from a mobile unit, the fee for investigating the application shall be $200, and the license fee shall be $250. If the application is filed after June 30th in any year the payment shall be one-half of the stated license fee in addition to the above stated fee for investigation.

Code 1935, § 2408B; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2713; 67 Del. Laws, c. 88, §§ 2, 3.;

(a) Surety bonds.

(1) Every licensee shall file with the Commissioner, in a form satisfactory to the Commissioner, an original corporate surety bond, with surety provided by a corporation authorized to transact business in this State, in the principal sum of $5,000.

(2) No bond shall be accepted unless the following requirements are satisfied:

a. The term of the bond shall be commensurate with the license period or continuous;

b. The expiration date of the bond shall not be earlier than midnight of the date on which the license expires; and

c. The bond shall run to the State, for the benefit of the office of the State Bank Commissioner and for the benefit of all consumers injured by any wrongful act, omission, default, fraud or misrepresentation by a licensee in the course of its activity as a licensee. Compensation under the bond shall be for amounts which represent actual losses and shall not be payable for claims made by business creditors, third-party service providers, agents or persons otherwise in the employ of the licensee. Surety claims shall be paid to the office of the State Bank Commissioner by the insurer not later than 90 days after receipt of a claim. Claims paid after 90 days shall be subject to daily interest at the legal rate. The aggregate liability of the surety on the bond, exclusive of any interest which accrues for payments made after 90 days, shall in no event exceed the amount of such bond.

(3) If the licensee changes its surety company or the bond is otherwise amended, the licensee shall immediately provide the Commissioner with the amended original copy of the surety bond. No cancellation of an existing bond by a surety shall be effective unless written notice of its intention to cancel is filed with the Commissioner at least 30 days before the date upon which cancellation shall take effect.

(4) The Commissioner may require potential claimants to provide such documentation and affirmations as the Commissioner shall determine to be necessary and appropriate. In the event the Commissioner determines that multiple consumers have been injured by a licensee, the Commissioner shall cause a notice to be published for the purpose of identifying all relevant claims.

(5) When a surety company receives a claim against the bond of a licensee, it shall immediately notify the Commissioner and shall not pay any claim unless and until it receives notice to do so from the Commissioner.

(6) The Commissioner shall have a period of 2 calendar years after the effective date of cancellation or termination of the surety bond by the insurer to submit claims to the insurer.

(b) Irrevocable letters of credit. — In lieu of requiring the filing of a surety bond, the Commissioner may, at the Commissioner's discretion, accept from a licensee an irrevocable letter of credit.

(1) Such irrevocable letter of credit shall be provided by an insured depository institution (as defined in the Federal Deposit Insurance Act at 12 U.S.C. § 1813(c)) acceptable to the Commissioner, in a form satisfactory to the Commissioner in the principal sum of $5,000.

(2) No irrevocable letter of credit shall be accepted unless the following requirements are satisfied:

a. The irrevocable letter of credit shall run to the State, for the benefit of the office of the State Bank Commissioner and for the benefit of all consumers injured by the wrongful act, omission, default, fraud or misrepresentation by a licensee in the course of its activity as a licensee. Compensation under the irrevocable letter of credit shall be for amounts which represent actual losses and shall not be payable for claims made by business creditors, third-party service providers, agents or persons otherwise in the employ of the licensee. The aggregate liability of the insured depository institution issuing the irrevocable letter of credit shall in no event exceed the amount of such irrevocable letter of credit; and

b. Draws upon such irrevocable letter of credit shall be available by sight drafts thereunder, in amounts determined by the Commissioner, up to the aggregate amount of the irrevocable letter of credit. Such drafts shall be paid in accordance with § 5-112(1) of Title 6.

(3) The Commissioner may require potential claimants to provide such documentation and affirmations as the Commissioner shall determine to be necessary and appropriate. In the event the Commissioner determines that multiple consumers have been injured by a licensee, the Commissioner shall cause a notice to be published for the purpose of identifying all relevant claims.

(4) The Commissioner may refuse release of an irrevocable letter of credit, following the surrender of a license, up to 2 years after the effective date of such termination of licensure.

Code 1935, § 2408C; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2714; 71 Del. Laws, c. 19, § 77.;

Each applicant for a license shall prove, in form satisfactory to the State Bank Commissioner, that the applicant has available for the operation of the business, for each location and for each mobile unit specified in the application, liquid assets of at least $5,000, and every licensee shall continuously maintain for the operation of the business for each location and for each mobile unit liquid assets of at least $5,000.

Code 1935, § 2408B; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2715; 70 Del. Laws, c. 186, § 1.;

If the State Bank Commissioner finds that the financial responsibility, experience, character and general fitness of the applicant, and of the members thereof if the applicant is a copartnership or association, and of the officers and directors thereof if the applicant is 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 chapter, and if the Commissioner finds that the granting of the application will promote the convenience and advantage of the area in which such business is to be conducted, and if the Commissioner finds that the applicant has available for the operation of the business for each location and for each mobile unit specified in the application liquid assets of at least $5,000, the Commissioner shall thereupon issue a license to permit the cashing of checks, drafts and money orders in accordance with this chapter at the location or in the area specified in the application.

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2716; 70 Del. Laws, c. 186, § 1; 80 Del. Laws, c. 225, § 7.;

If the State Bank Commissioner finds that the applicant fails to meet any of the conditions set forth in § 2716 of this title, the Commissioner shall not issue the license, and the Commissioner 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 § 2720 of this title, retain the investigation fee to cover the costs of investigating the application and return the license fee to the applicant.

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2717; 70 Del. Laws, c. 186, § 1.;

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2718; 72 Del. Laws, c. 15, § 38; repealed by 80 Del. Laws, c. 225, § 8, eff. May 9, 2016.;

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2719; repealed by 80 Del. Laws, c. 225, § 10, eff. May 9, 2016.;

A license issued pursuant to this chapter shall be for a term expiring on the 31st 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 §§ 2711-2715 of this title; except that no fee shall be charged by the State Bank Commissioner for investigating such application. Every holder of a license or a renewal thereof, as provided for in this section, desiring to continue the transaction of business as provided for in this chapter, shall at least 30 days prior to the expiration of such license or renewal thereof make application to the Commissioner on forms to be provided by the Commissioner for a license renewal. The Commissioner may mandate that applications for renewal shall be treated as new applications if said renewal applications are not on file with the office of the State Bank Commissioner at least 30 days prior to the expiration of such license or renewal thereof. Licensees who have not complied with supervisory letters or who have not paid examination fees when due may be refused license renewal.

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2720; 70 Del. Laws, c. 6, § 13; 70 Del. Laws, c. 327, § 42.;

The license shall not be transferable or assignable.

Code 1935, § 2408D; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2721.;

Not more than 1 place of business or 1 mobile unit shall be maintained under the same license. More than 1 license may be issued to the same licensee upon compliance with this chapter for each new license.

Code 1935, § 2408E; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2722.;

Any licensed casher of checks may open and maintain, within this State, 1 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 limited station. The 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 $10 and the annual license fee for each limited station shall be $20.

Code 1935, § 2408E; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2723.;

(a) A licensee may make a written application to the State Bank Commissioner for leave to change the licensee's place of business, or in the case of a mobile unit, the area in which the unit is authorized to be operated, stating the reasons for the proposed change. If the Commissioner approves the application the Commissioner shall issue a new license in accordance with § 2716 of this title, for the new location of the licensee or, in the case of a mobile unit, the new area in which the mobile unit may be operated.

(b) In case there is a change in name but no change in corporate structure of a licensee, the Commissioner shall issue without charge an amended license for the new name.

Code 1935, § 2408E; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2724; 72 Del. Laws, c. 15, § 39; 70 Del. Laws, c. 186, § 1; 80 Del. Laws, c. 225, § 9.;

(a) The Commissioner may revoke any license issued hereunder upon finding that:

(1) The licensee has violated any provision of this chapter or any rule or regulation made by the Commissioner under and within the authority of this chapter or of any other law, rule or regulation of this State or the United States;

(2) Any fact or condition exists which, if it had existed at the time of the original application for such license, would have warranted the Commissioner in refusing originally to issue such license; or

(3) The licensee has engaged in business activities or practices, in connection with any business for which a license is required under this chapter, which could be deemed unfair or deceptive by nature of intent. Such activities and practices include, but are not limited to, the use of tactics which mislead the consumer, misrepresent the consumer transaction or any part thereof, or otherwise create false expectations on the part of the consumer.

(b) The Commissioner may temporarily suspend any license pending the issuance of a final order as provided in Chapter 101 of Title 29.

(c) Except as provided in subsection (b) of this section, no license shall be revoked or suspended except after notice and an opportunity for the licensee to request a hearing in accordance with Chapter 101 of Title 29.

(d) Any licensee may surrender any license by delivering to the Commissioner such license together with written notice that it thereby surrenders such license, but such surrender shall not affect such licensee's civil or criminal liability for acts committed prior to such surrender.

(e) No revocation, suspension or surrender of any license shall impair or affect the obligation of any preexisting lawful contract between the licensee and any person.

(f) Every license issued hereunder shall remain in force and effect until the same shall have expired or shall have been surrendered, revoked or suspended in accordance with this chapter, but the Commissioner shall have authority to reinstate a suspended license or to issue a new license to a licensee whose license shall have been revoked if no fact or condition then exists which would have warranted the Commissioner in refusing originally to issue such license under this chapter.

(g) Whenever the Commissioner shall revoke or suspend a license issued pursuant to this chapter, the Commissioner shall forthwith execute a written order to that effect. The Commissioner shall forthwith serve the written order upon the licensee. Any such order may be reviewed in the manner provided by Chapter 101 of Title 29.

Code 1935, § 2408H; 46 Del. Laws, c. 287, § 1; 5 Del. C. 1953, § 2725; 57 Del. Laws, c. 740, § 24; 70 Del. Laws, c. 186, § 1; 73 Del. Laws, c. 24, § 13; 77 Del. Laws, c. 126, § 6.;