2023 Tennessee Code › Title 45 - BANKS AND FINANCIAL INSTITUTIONS (§§ 45-1-101 — 45-20-111) › Chapter 7 - MONEY TRANSMISSION MODERNIZATION ACT (§§ 45-7-101 — 45-7-144) › Part 1 - MONEY TRANSMISSION MODERNIZATION ACT (§§ 45-7-101 — 45-7-144) › Section 45-7-103 - Chapter definitions

As used in this chapter:
(1)
"Acting in concert" means persons knowingly acting together with a common goal of jointly acquiring control of a licensee whether or not pursuant to an express agreement;
(2)
"Authorized delegate" means a person that a licensee designates to engage in money transmission on behalf of the licensee;
(3)
"Average daily money transmission liability" means the amount of the licensee's outstanding money transmission obligations in this state at the end of each day in a given period of time, added together, and divided by the total number of days in the given period of time. For purposes of calculating average daily money transmission liability under this chapter for any licensee required to do so, the given periods of time are the calendar quarters ending March 31, June 30, September 30, and December 31;
(4)
"Bank Secrecy Act" means the federal Bank Secrecy Act (
31 U.S.C. § 5311
et seq.) and its implementing regulations;
(5)
"Closed loop stored value" means stored value that is redeemable by the issuer only for goods or services provided by the issuer or its affiliate or franchisees of the issuer or its affiliate, except to the extent required by applicable law to be redeemable in cash for its cash value;
(6)
"Commissioner" means the commissioner of financial institutions;
(7)
(A)
"Control" means the power to:
(i)
Vote, directly or indirectly, at least twenty-five percent (25%) of the outstanding voting shares or voting interests of a licensee or person in control of a licensee;
(ii)
Elect or appoint a majority of key individuals or executive officers, managers, directors, trustees, or other persons exercising managerial authority of a person in control of a licensee; or
(iii)
Exercise, directly or indirectly, a controlling influence over the management or policies of a licensee or person in control of a licensee;
(B)
(i)
A person is presumed to exercise a controlling influence when the person holds the power to vote, directly or indirectly, at least ten percent (10%) of the outstanding voting shares or voting interests of a licensee or person in control of a licensee;
(ii)
A person presumed to exercise a controlling influence as defined by this subdivision (7)(B) may rebut the presumption of control by showing that the person is a passive investor;
(C)
For purposes of determining the percentage of a person controlled by another person, the person's interest is aggregated with the interest of:
(i)
Any immediate family member, including the person's spouse, parents, children, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, brothers- and sisters-in-law; and
(ii)
Any person who shares such person's home;
(8)
"Department" means the department of financial institutions;
(9)
"Eligible rating" means a credit rating of any of the three (3) highest rating categories provided by an eligible rating service, whereby each category may include rating category modifiers, such as "plus" or "minus" for Standard & Poor's (S&P), or the equivalent for any other eligible rating service. Long-term credit ratings are deemed eligible if the rating is equal to A- or higher by S&P, or the equivalent from any other eligible rating service. Short-term credit ratings are deemed eligible if the rating is equal to or higher than A-2 or SP-2 by S&P, or the equivalent from any other eligible rating service. In the event that ratings differ among eligible rating services, the highest rating applies when determining whether a security bears an eligible rating;
(10)
"Eligible rating service" means any Nationally Recognized Statistical Rating Organization (NRSRO), as defined by the United States Securities and Exchange Commission, and any other organization designated by the commissioner;
(11)
"Executive officer" means the applicant or licensee's president, chair of the executive committee, executive vice president, treasurer, chief financial officer, or any other person who performs similar functions;
(12)
"Federally insured depository financial institution" means a bank, credit union, savings and loan association, trust company, savings association, savings bank, industrial bank, or industrial loan company organized under the laws of the United States or any state of the United States and that has federally insured deposits;
(13)
"In this state" means:
(A)
For a transaction requested in person, at a physical location within this state; and
(B)
For a transaction requested electronically or by phone, the provider of money transmission may determine if the person requesting the transaction is "in this state" by relying on other information provided by the person regarding the location of the individual's residential address or a business entity's principal place of business or other physical address location, and any records associated with the person that the provider of money transmission may have that indicate such location, including, but not limited to, an address associated with an account;
(14)
"Individual" means a natural person;
(15)
"Key individual" means any individual ultimately responsible for establishing or directing policies and procedures of the licensee, such as an executive officer, manager, director, or trustee;
(16)
"Licensee" means a person licensed under this chapter;
(17)
"Material litigation" means litigation that, according to United States generally accepted accounting principles, is significant to a person's financial health and would be required to be disclosed in the person's annual audited financial statements, report to shareholders, or similar records;
(18)
"Monetary value" means a medium of exchange, whether or not redeemable in money;
(19)
"Money":
(A)
Means a medium of exchange that is authorized or adopted by the United States or issued by a foreign government; and
(B)
Includes a monetary unit of account established by an intergovernmental organization or by agreement between two (2) or more governments;
(20)
"Money transmission":
(A)
Means:
(i)
Selling or issuing payment instruments to a person located in this state;
(ii)
Selling or issuing stored value to a person located in this state;
(iii)
Receiving money for transmission from a person located in this state; or
(iv)
Payroll processing services; and
(B)
Does not mean the provision solely of telecommunications services or network access;
(21)
"Multistate licensing process" means any agreement entered into by this state with any other state's regulators relating to coordinated processing of applications for money transmission licenses, applications for the acquisition of control of a licensee, control determinations, or notice and information requirements for a change of key individuals;
(22)
"NMLS" means the Nationwide Multistate Licensing System and Registry developed by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators and owned and operated by the State Regulatory Registry, LLC, or any successor or affiliated entity, for the licensing and registration of persons in financial services industries;
(23)
(A)
"Outstanding money transmission obligations," which must be established and extinguished in accordance with applicable state law, means:
(i)
Any payment instrument or stored value issued or sold by the licensee to a person located in the United States or reported as sold by an authorized delegate of the licensee to a person that is located in the United States that has not yet been paid or refunded by or for the licensee, or escheated in accordance with applicable abandoned property laws; or
(ii)
Any money received for transmission by the licensee or an authorized delegate in the United States from a person located in the United States that has not been received by the payee or refunded to the sender, or escheated in accordance with applicable abandoned property laws;
(B)
For purposes of this subdivision (23), "in the United States" includes, to the extent applicable, a person in any state, territory, or possession of the United States, the District of Columbia, the Commonwealth of Puerto Rico, or a United States military installation that is located in a foreign country;
(24)
"Passive investor" means a person that:
(A)
Does not have the power to elect a majority of key individuals or executive officers, managers, directors, trustees, or other persons exercising managerial authority of a person in control of a licensee;
(B)
Is not employed by and does not have any managerial duties of the licensee or person in control of a licensee;
(C)
Does not have the power to exercise, directly or indirectly, a controlling influence over the management or policies of a licensee or person in control of a licensee; and
(D)
Attests to subdivisions (24)(A), (24)(B), and (24)(C), in a form and in a medium prescribed by the commissioner; or commits to the passivity characteristics of subdivisions (24)(A), (24)(B), and (24)(C), in a written document satisfactory to the commissioner;
(25)
"Payment instrument":
(A)
Means a written or electronic check, draft, money order, traveler's check, or other written or electronic instrument for the transmission or payment of money or monetary value, whether or not negotiable; and
(B)
Does not mean stored value or any instrument that:
(i)
Is redeemable by the issuer only for goods or services provided by the issuer or its affiliate or franchisees of the issuer or its affiliate, except to the extent required by applicable law to be redeemable in cash for its cash value; or
(ii)
Is not sold to the public but issued and distributed as part of a loyalty, rewards, or promotional program;
(26)
"Payroll processing services":
(A)
Means receiving money for transmission pursuant to a contract with a person to deliver wages or salaries, make payment of payroll taxes to state and federal agencies, make payments relating to employee benefit plans, or make distributions of other authorized deductions from wages or salaries; and
(B)
Does not mean an employer performing payroll processing services on its own behalf or on behalf of its affiliate, or a professional employer organization registered under the Tennessee Professional Employer Organization Act, compiled in title 62, chapter 43;
(27)
"Person" means any individual, general partnership, limited partnership, limited liability company, corporation, trust, association, joint stock corporation, or other corporate entity identified by the commissioner;
(28)
"Receiving money for transmission" or "money received for transmission" means receiving money or monetary value in the United States for transmission within or outside the United States by electronic or other means;
(29)
"Stored value":
(A)
Means monetary value representing a claim against the issuer evidenced by an electronic or digital record, and that is intended and accepted for use as a means of redemption for money or monetary value, or payment for goods or services;
(B)
Includes, but is not limited to, "prepaid access" as defined by
31 CFR § 1010.100
; and
(C)
Does not include a payment instrument or closed loop stored value, or stored value not sold to the public but issued and distributed as part of a loyalty, rewards, or promotional program; and
(30)
"Tangible net worth" means the aggregate assets of a licensee excluding all intangible assets, less liabilities, as determined in accordance with United States generally accepted accounting principles.
Amended by 2023 Tenn. Acts, ch. 115, s 1, eff. 1/1/2024.
Acts 1994, ch. 715, § 1; T.C.A., §
45-7-203
; Acts 2020, ch. 730, § 1.