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ACT NO. 55

(S.200)

Regulation of the Provision of Money Services

This act modifies the regulatory scheme of the Department of Banking, Insurance, Securities, and Health Care Administration’s banking division and consists of four parts. The first part creates a system of regulating nonbank money services by addressing safety and soundness issues and establishing criteria for a requirement of a license. Money services businesses engage in the following types of financial activities: money transmission, the sale of payment instruments (such as money orders, travelers checks and stored-value cards), check cashing and foreign currency exchange.

The second part requires lenders to fund residential mortgage loan closings in a timely manner or be liable for statutory or actual damages.

The third part requires that sensitive information disclosed by credit unions and licensees of the banking division that are not banks to the Department with consumer complaints and during examinations and investigations is confidential.

The fourth part amends the licensed lender laws by exempting from the licensing requirement colleges and universities that make direct loans to their employees.

Effective Date: The money services provisions are effective January 1, 2002. The funded settlement provisions are effective July 1, 2001 and the confidentiality section and the licensed lender exemption sections are effective June 12, 2001.