07
SB70/AP
Senate
Bill 70
By:
Senators Hamrick of the 30th, Hudgens of the 47th, Thompson of the 33rd, Murphy
of the 27th, Tarver of the 22nd and others
AS PASSED
AS PASSED
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 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)
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;
(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
(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 7-1-287, 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. 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 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.
(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. 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 for check
sellers or, if the outstanding orders to transmit not yet paid for 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 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 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 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 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)
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 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 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 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 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,
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 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 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.
(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)
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 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 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 license or registration issued pursuant
to this article if:
(1)
It shall find that the licensee or registrant has:
(A)
Committed any fraud, engaged in any dishonest activities, or made any
misrepresentation;
(B)
Violated any provisions of the banking law or any regulation issued pursuant
thereto or has violated any other law in the course of its, his, or her dealings
as a licensed or registered casher of checks;
(C)
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)
Demonstrated his, her, or its incompetency or untrustworthiness to act as a
licensed or registered casher of checks;
(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
(F)
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)
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 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 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 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 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; 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.
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 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 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 executive officer, 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 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 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, no person shall acquire directly or
indirectly 10 percent or more of the voting shares of a corporation or 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 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. 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
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,
registration, or mortgage broker education approval on any ground on which it
might refuse to issue an original 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.