Public Act 93-0535
SB24 Enrolled LRB093 02172 JLS 03494 b
AN ACT concerning transmitters of money.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Transmitters of Money Act is amended by
changing Sections 5, 65, and 90 and adding Sections 37 and 93
as follows:
(205 ILCS 657/5)
Sec. 5. Definitions. As used in this Act, unless the
context otherwise requires, the words and phrases defined in
this Section have the meanings set forth in this Section.
"Authorized seller" means a person not an employee of a
licensee who engages in the business regulated by this Act on
behalf of a licensee under a contract between that person and
the licensee.
"Bill payment service" means the business of transmitting
money on behalf of an Illinois resident for the purpose of
paying the resident's bills.
"Controlling person" means a person owning or holding the
power to vote 25% or more of the outstanding voting
securities of a licensee or the power to vote the securities
of another controlling person of the licensee. For purposes
of determining the percentage of a licensee controlled by a
controlling person, the person's interest shall be combined
with the interest of any other person controlled, directly or
indirectly, by that person or by a spouse, parent, or child
of that person.
"Department" means the Department of Financial
Institutions.
"Director" means the Director of Financial Institutions.
"Licensee" means a person licensed under this Act.
"Location" means a place of business at which activity
regulated by this Act occurs.
"Material litigation" means any litigation that,
according to generally accepted accounting principles, is
deemed significant to a licensee's financial health and would
be required to be referenced in a licensee's annual audited
financial statements, reports to shareholders, or similar
documents.
"Money" means a medium of exchange that is authorized or
adopted by a domestic or foreign government as a part of its
currency and that is customarily used and accepted as a
medium of exchange in the country of issuance.
"Money transmitter" means a person who is located in or
doing business in this State and who directly or through
authorized sellers does any of the following in this State:
(1) Sells or issues payment instruments.
(2) Engages in the business of receiving money for
transmission or transmitting money.
(3) Engages in the business of exchanging, for
compensation, money of the United States Government or a
foreign government to or from money of another
government.
"Outstanding payment instrument" means, unless otherwise
treated by or accounted for under generally accepted
accounting principles on the books of the licensee, a payment
instrument issued by the licensee that has been sold in the
United States directly by the licensee or has been sold in
the United States by an authorized seller of the licensee and
reported to the licensee as having been sold, but has not
been paid by or for the licensee.
"Payment instrument" means a check, draft, money order,
traveler's check, stored value card, or other instrument or
memorandum, written order or written receipt for the
transmission or payment of money sold or issued to one or
more persons whether or not that instrument or order is
negotiable. Payment instrument does not include an
instrument that is redeemable by the issuer in merchandise or
service, a credit card voucher, or a letter of credit. A
written order for the transmission or payment of money that
results in the issuance of a check, draft, money order,
traveler's check, or other instrument or memorandum is not a
payment instrument.
"Person" means an individual, partnership, association,
joint stock association, corporation, or any other form of
business organization.
"Stored value card" means any magnetic stripe card or
other electronic payment instrument given in exchange for
money and other similar consideration, including but not
limited to checks, debit payments, money orders, drafts,
credit payments, and traveler's checks, where the card or
other electronic payment instrument represents a dollar value
that the consumer can either use or give to another
individual.
"Transmitting money" means the transmission of money by
any means, including transmissions to or from locations
within the United States or to and from locations outside of
the United States by payment instrument, facsimile or
electronic transfer, or otherwise, and includes bill payment
services.
(Source: P.A. 92-400, eff. 1-1-02.)
(205 ILCS 657/37 new)
Sec. 37. Display of disclosure notice.
(a) Each authorized seller shall conspicuously display a
disclosure notice supplied by the licensee; each licensee
that transmits money directly shall also conspicuously
display a disclosure notice.
(b) The disclosure notice shall contain the following
information:
(1) In the case of an authorized seller only, the
name of the authorized seller's licensee issuing the
disclosure notice.
(2) A toll-free telephone number for the Department
of Financial Institutions which will provide customer
support for suspected violations of this Act.
(3) A statement that the authorization may be
revoked at any time by the licensee.
(c) A licensee shall notify the Department within 30
days when an authorized seller is no longer an authorized
seller for the licensee. An authorized seller who has been
terminated shall remove the disclosure notice from the
premises within 10 business days after such termination. A
terminated authorized seller who wilfully and knowingly
refuses to remove the disclosure notice within 10 business
days of termination commits a Class B misdemeanor.
(d) If a customer of a former authorized seller
detrimentally relies on a disclosure notice that was not
removed, the former authorized seller shall be civilly liable
if the customer proves: (1) that the entity possessed the
disclosure notice beyond 10 business days from the
termination of authorization by the licensee, (2) that the
entity held itself out as an authorized seller, without
informing the customer that the seller was no longer
authorized by the licensee, (3) that the customer justifiably
relied upon the conspicuously displayed disclosure notice
formerly provided by the licensee, and (4) that the entity
engaged in the business of transmitting money after its
termination as an authorized seller.
(e) As used in this Section, "civil liability" means
liability for actual loss, reasonable attorney's fees, and
costs.
(205 ILCS 657/65)
Sec. 65. Notice of source of instrument; transaction
records.
(a) Every payment instrument other than a stored value
card sold through an authorized seller shall bear the name of
the licensee and a unique consecutive number clearly stamped
or imprinted on it. When an order for the transmission of
money results in the issuance of a payment instrument, both
the order and the payment instrument may bear the same unique
number.
(b) A licensee or authorized seller shall create a
record, which may be reduced to computer or other electronic
medium, upon receiving any money from a customer.
(c) For each payment instrument other than a stored
value card sold, the licensee shall require the authorized
seller to record the face amount of the payment instrument
and the serial number of the payment instrument.
(d) For each transmission of money, the licensee or
authorized seller shall record the date the money was
received, the face amount of the payment instrument, the name
of the customer, the manner of transmission, including the
identity and location of any bank or other financial
institution receiving or otherwise involved in accomplishing
the transmission, the location to which the money is
transmitted if different from the bank or other financial
institution required to be recorded, the name of the intended
recipient, and the date the transmission was accomplished or
the money was refunded to the customer due to an inability to
transmit or failure of the intended recipient to receive or
obtain the money transmitted. The transmission shall be made
by the licensee or authorized seller within 3 business days
after the receipt of the money to be transmitted. The
licensee or authorized seller, in addition to the records
required to be kept, shall issue a receipt to each person
delivering or depositing money with the licensee or
authorized seller indicating the date of the transaction, the
face amount of the payment instrument, to whom the money is
to be transmitted, the service charge, and the name and
address of the licensee or authorized seller. The receipt or
a separate disclosure at the time of the money transmission
shall also include a statement of the licensee's refund
procedures as well as a toll-free telephone number for
customer assistance. An inadvertent or non-wilful failure to
give a consumer the disclosure provided for in this Section
shall not constitute a violation of this Act. The licensee or
authorized seller shall keep a copy of every receipt in a
permanent record book or maintain the data embodied in the
receipt using photographic, electronic, or other means.
(e) For each exchange of money of the United States
government or a foreign government to or from money of
another government, the licensee or authorized seller shall
record the date of the transaction, the amount of the
transaction, the amount of funds stated in currency received
by the recipient, and the rate of exchange at the time of the
transaction. The licensee or authorized seller, in addition
to the records required to be kept, shall issue a receipt to
each person delivering or depositing money with the licensee
or authorized seller indicating the date of the transaction,
the amount of the transaction, the service charge, and the
name and address of the licensee or authorized seller making
the transaction. The licensee or authorized seller shall
keep a copy of every receipt in a permanent record book or
maintain data embodied in the receipt using photographic,
electronic, or other means.
(f) Records required to be kept by the licensee or
authorized seller under this Act shall be preserved for at
least 5 years or as required to comply with any other Act the
administration of which is vested in the Director. The
records shall be made available for examination in accordance
with Sections 55 and 60 of this Act.
(Source: P.A. 88-643, eff. 1-1-95.)
(205 ILCS 657/90)
Sec. 90. Enforcement.
(a) If it appears to the Director that a person has
committed or is about to commit a violation of this Act, a
rule promulgated under this Act, or an order of the Director,
the Director may apply to the circuit court for an order
enjoining the person from violating or continuing to violate
this Act, the rule, or order and for injunctive or other
relief that the nature of the case may require and may, in
addition, request the court to assess a civil penalty up to
$1,000 along with costs and attorney fees.
(b) If the Director finds, after an investigation that
he considers appropriate, that a licensee or other person is
engaged in practices contrary to this Act or to the rules
promulgated under this Act, the Director may issue an order
directing the licensee or person to cease and desist the
violation. The Director may, in addition to or without the
issuance of a cease and desist order, assess an
administrative penalty up to $1,000 against a licensee for
each violation of this Act or the rules promulgated under
this Act. The issuance of an order under this Section shall
not be a prerequisite to the taking of any action by the
Director under this or any other Section of this Act. The
Director shall serve notice of his action, including a
statement of the reasons for his actions, either personally
or by certified mail, return receipt requested. Service by
mail shall be deemed completed if the notice is deposited in
the post office, postage paid, addressed to the last known
address for a license.
(c) In the case of the issuance of a cease and desist
order or assessment order, a hearing may be requested in
writing within 30 days after the date of service. The
hearing shall be held at the time and place designated by the
Director in either the City of Springfield or the City of
Chicago. The Director and any administrative law judge
designated by him shall have the power to administer oaths
and affirmations, subpoena witnesses and compel their
attendance, take evidence, authorize the taking of
depositions, and require the production of books, papers,
correspondence, and other records or information that he
considers relevant or material to the inquiry.
(d) After the Director's final determination under a
hearing under this Section, a party to the proceedings whose
interests are affected by the Director's final determination
shall be entitled to judicial review of that final
determination under the Administrative Review Law.
(e) The costs for administrative hearings shall be set
by rule.
(f) Except as otherwise provided in this Act, a
violation of this Act shall subject to the party violating it
to a fine of $1,000 for each offense.
(g) Each transaction in violation of this Act or the
rules promulgated under this Act and each day that a
violation continues shall be a separate offense.
(h) A person who engages in conduct requiring a license
under this Act and fails to obtain a license from the
Director or knowingly makes a false statement,
misrepresentation, or false certification in an application,
financial statement, account record, report, or other
document filed or required to be maintained or filed under
this Act or who knowingly makes a false entry or omits a
material entry in a document is guilty of a Class 3 felony.
(i) The Director is authorized to compromise, settle,
and collect civil penalties and administrative penalties, as
set by rule, with any person for violations of this Act or of
any rule or order issued or promulgated under this Act. Any
person who, without the required license, engages in conduct
requiring a license under this Act shall be liable to the
Department in an amount equal to the greater of (i) $5,000 or
(ii) an amount of money accepted for transmission plus an
amount equal to 3 times the amount accepted for transmission.
The Department shall cause any funds so recovered to be
deposited in the TOMA Consumer Protection Fund.
(j) The Director may enter into consent orders at any
time with a person to resolve a matter arising under this
Act. A consent order must be signed by the person to whom it
is issued and must indicate agreement to the terms contained
in it. A consent order need not constitute an admission by a
person that this Act or a rule or order issued or promulgated
under this Act has been violated, nor need it constitute a
finding by the Director that the person has violated this Act
or a rule or order promulgated under this Act.
(k) Notwithstanding the issuance of a consent order, the
Director may seek civil or criminal penalties or compromise
civil penalties concerning matter encompassed by the consent
order unless the consent order by its terms expressly
precludes the Director from doing so.
(l) Appeals from all final orders and judgments entered
by the circuit court under this Section in review of a
decision of the Director may be taken as in other civil
actions by any party to the proceeding.
(Source: P.A. 88-643, eff. 1-1-95; 89-601, eff. 8-2-96.)
(205 ILCS 657/93 new)
Sec. 93. Consumer Protection Fund.
(a) A special income-earning fund is hereby created in
the State treasury, known as the TOMA Consumer Protection
Fund.
(b) All moneys paid into the fund together with all
accumulated undistributed income thereon shall be held as a
special fund in the State treasury. The fund shall be used
solely for the purpose of providing restitution to consumers
who have suffered monetary loss arising out of a transaction
regulated by this Act.
(c) The fund shall be applied only to restitution when
restitution has been ordered by the Director. Restitution
shall not exceed the amount actually lost by the consumer.
The fund shall not be used for the payment of any attorney or
other fees.
(d) The fund shall be subrogated to the amount of the
restitution, and the Director shall request the Attorney
General to engage in all reasonable collection steps to
collect restitution from the party responsible for the loss
and reimburse the fund.
(e) Notwithstanding any other provisions of this
Section, the payment of restitution from the fund shall be a
matter of grace and not of right, and no consumer shall have
any vested rights in the fund as a beneficiary or otherwise.
Before seeking restitution from the fund, the consumer or
beneficiary seeking payment of restitution shall apply for
restitution on a form provided by the Director. The form
shall include any information the Director may reasonably
require in order to determine that restitution is
appropriate.
Section 95. The State Finance Act is amended by adding
Section 5.595 as follows:
(30 ILCS 105/5.595 new)
Sec. 5.595. The TOMA Consumer Protection Fund.