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Summer 2017 Newsletter
Money Services Industry Update
|License Types||As of July 2017||As of July 2016|
|Money Transmitter - Main||158||149|
|Money Transmitter - Authorized Delegates||10,512||10,855|
|Currency Exchanger - Main||7||9|
|Currency Exchanger - Authorized Delegates||4||4|
Electronic Surety Bonds for Money Services Licensees
The Department recently announced expansion of the Electronic Surety Bond (ESB) functionality in NMLS to Money Transmitter and certain Currency Exchanger applicants and licensees. The launch of the ESB for these license types starts July 17. Applicants with a surety bond requirement must use ESB and licensees can start converting their paper bonds to ESB after that date.
ESB functionality was rolled out in NMLS in late 2016. It enables a surety bond to be issued and maintained electronically on NMLS. Benefits of ESB include the elimination of paper bond documents, reduction of postage costs and lag time delivering bond materials, and increasing transparency for bond actions like cancellations and reinstatements.
Current Money Transmitter licensees are required to convert their existing paper surety bond into an electronic bond on NMLS by July 1, 2018. The Department and many surety companies strongly encourage licensees to complete the conversion as part of the bond renewal. The following steps are required to convert a paper bond to ESB:
- Contact the agent who provides your surety bond to ensure they are set up (entitled) on NMLS
- Grant authority to your surety bond issuer in NMLS; the surety bond issuer must start the bond conversion process
- Once the converted bond is ready, it is delivered to licensees electronically in NMLS; the bond must be electronically signed by an authorized individual
- Bond must be designated “Marked Ready” before it will be delivered to the Department
Several resources are available at NMLS Electronic Surety Bond including quick guides, ESB training, and the ESB Adoption table. Licensees with questions or who experience problems with ESB should email DCS@dfi.wa.gov.
*Currency Exchanger licensees haven’t had a bond requirement so no paper bonds exist to be converted to ESB.
Changes to Money Transmitter Law Effective Soon
Amendments to the Uniform Money Services Act (chapter 19.230 RCW) take effect July 23, 2017. The amendments, among other things, codify the agency’s Interim Guidance on the regulation of companies engaged in money transmission using virtual currency, add certain required disclosures for the companies in the virtual currency industry, create a bond requirement for online currency exchangers, add certain types of payment processors for the purchase of goods and services to the list of exclusions from the act, add payroll, bookkeeping, and accounting companies to the exclusions, and clarify that the agency can participate in joint and concurrent examinations with other states and the federal government.
You can see the changes here: Substitute Senate Bill 5031
MSB Call Report Deadline
August 14th is the filing deadline for the Quarter 2 Money Services Business (MSB) Call Report. The MSB Call Report is filed through NMLS and is due within 45 days of each quarter end. This report is in addition to the Department’s annual report which is due July 1 each year.
The MSB Call Report contains several sections. It can be completed manually or through a CSV or XML upload. There is a webpage on the NMLS Resource Center dedicated to the MSB Call Report. It lists the states adopting the MSB Call Report, links to Quick Guides to assist with filing the report and provides answers to frequently asked questions. There is also a link to a pre-recorded training.
Authorized Delegates Reporting
Timing for reporting additions, changes, or terminations of authorized delegates has changed pursuant to WAC 208-690-120. The NMLS checklist is in the process of being updated to reflect these changes.