(a) As used in this Section, "remit" means to make direct payments of money to a licensee or its representative authorized to receive money or to deposit money in a bank in an account specified by the licensee. (b) Before a licensee is authorized to conduct business through an authorized delegate or allows a person to act as the licensee's authorized delegate, the licensee must: (1) adopt, and update as necessary, written policies and procedures reasonably designed to ensure that the licensee's authorized delegates comply with applicable State and federal law; (2) enter into a written contract that complies with subsection (d); and (3) conduct a reasonable risk-based background investigation sufficient for the licensee to determine whether the authorized delegate has complied and will likely comply with applicable state and federal law. (c) An authorized delegate must operate in full compliance with this Act. (d) The written contract required by subsection (b) must be signed by the licensee and the authorized delegate and, at a minimum, must: (1) expressly appoint the person signing the contract as the licensee's authorized delegate with the authority to conduct money transmission on behalf of the licensee; (2) set forth the nature and scope of the relationship between the licensee and the authorized delegate and the respective rights and responsibilities of the parties; (3) require the authorized delegate to agree to fully comply with all applicable State and federal laws, rules, and regulations pertaining to money transmission, including this Act and regulations implementing this Act, relevant provisions of the Bank Secrecy Act, and the USA PATRIOT ACT; (4) require the authorized delegate to remit and handle money and monetary value in accordance with the terms of the contract between the licensee and the authorized delegate; (5) impose a trust on money and monetary value net of fees received for money transmission for the benefit of the licensee; (6) require the authorized delegate to prepare and maintain records as required by this Act or regulations implementing this Act, or as reasonably requested by the Secretary; (7) acknowledge that the authorized delegate consents to examination or investigation by the Secretary; (8) state that the licensee is subject to regulation by the Secretary and that, as part of that regulation, the Secretary may suspend or revoke an authorized delegate designation or require the licensee to terminate an authorized delegate designation; and (9) acknowledge receipt of the written policies and procedures required under paragraph (1) of subsection (b). (e) If the licensee's license is suspended, revoked, surrendered, or expired, the licensee must, within 5 business days, provide documentation to the Secretary that the licensee has notified all applicable authorized delegates of the licensee whose names are in a record filed with the Secretary of the suspension, revocation, surrender, or expiration of a license. Upon suspension, revocation, surrender, or expiration of a license, applicable authorized delegates shall immediately cease to provide money transmission as an authorized delegate of the licensee. (f) An authorized delegate of a licensee holds in trust for the benefit of the licensee all money net of fees received from money transmission. If any authorized delegate commingles any funds received from money transmission with any other funds or property owned or controlled by the authorized delegate, all commingled funds and other property shall be considered held in trust in favor of the licensee in an amount equal to the amount of money net of fees received from money transmission. (g) An authorized delegate may not use a subdelegate to conduct money transmission on behalf of a licensee. and procedures reasonably designed to ensure that the licensee's authorized delegates comply with applicable State and federal law; subsection (d); and investigation sufficient for the licensee to determine whether the authorized delegate has complied and will likely comply with applicable state and federal law. as the licensee's authorized delegate with the authority to conduct money transmission on behalf of the licensee; relationship between the licensee and the authorized delegate and the respective rights and responsibilities of the parties; comply with all applicable State and federal laws, rules, and regulations pertaining to money transmission, including this Act and regulations implementing this Act, relevant provisions of the Bank Secrecy Act, and the USA PATRIOT ACT; handle money and monetary value in accordance with the terms of the contract between the licensee and the authorized delegate; fees received for money transmission for the benefit of the licensee; maintain records as required by this Act or regulations implementing this Act, or as reasonably requested by the Secretary; to examination or investigation by the Secretary; by the Secretary and that, as part of that regulation, the Secretary may suspend or revoke an authorized delegate designation or require the licensee to terminate an authorized delegate designation; and procedures required under paragraph (1) of subsection (b).
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