Kentucky Administrative Regulations › Title 808 - PUBLIC PROTECTION CABINET - DEPARTMENT OF FINANCIAL INSTITUTIONS › Chapter 9 - Check Cashing › Section 808 KAR 9:050 - Licensee change of control

Current through Register Vol. 51, No. 1, July 1, 2024
RELATES TO:
				KRS
				286.9-010,
				286.9-020,
				286.9-030,
				286.9-040,
				286.9-050,
				286.9-060,
				286.9-070,
				286.9-071,
				286.9-073,
				286.9-080,
				286.9-104
NECESSITY, FUNCTION, AND CONFORMITY:
				KRS
				286.9-090(1) authorizes the
				commissioner to adopt reasonable administrative regulations for the enforcement
				of KRS Chapter 286.9.
				KRS
				286.9-050 and
				286.9-060
				authorize the commissioner to prescribe the form and materials required to
				apply for a license under KRS Chapter 286.9.
				KRS
				286.9-070 requires licensees to file a
				written request for a change of control and to pay the cost incurred by the
				commissioner in investigating the change of control request. This
				administrative regulation establishes the required filing procedures for change
				of control by check cashing licensees.
Section
			 1. Pursuant to the moratorium on the deferred deposit service
			 business license in
			 KRS
			 286.9-071, a license issued prior to July 2,
			 2009, shall be a deferred deposit service business license.
Section 2. Interpretation of
			 KRS
			 286.9-030(3). A person shall
			 be deemed principally engaged in the business of cashing checks and not
			 principally engaged in the retail sale of goods or services at any particular
			 location if the location's gross annual check cashing receipts exceed more than
			 fifty (50) percent of the location's annual revenue.
Section 3. Change of Control. A licensee
			 requesting a change of control pursuant to
			 KRS
			 286.9-070(5) shall submit:
(1) A completed Change of Control form,
			 available online at
http://mortgage.nationwidelicensingsystem.org
;
(2) A nonrefundable investigation fee of
			 $500, if the person obtaining control of the licensee is not a
			 licensee;
(3) If the person
			 obtaining control of the licensee has a license, registration, or claim of
			 exemption related to the financial services industry in any other state, a Form
			 COMB-1, State License Confirmation Form for Check Cashing License or Deferred
			 Deposit Service Business License for the person obtaining control of the
			 licensee;
(4) An audited financial
			 statement for the person obtaining control of the licensee prepared by a
			 certified public accountant in accordance with generally accepted accounting
			 principles as of the previous year end that includes:
(a) A balance sheet;
(b) Income statement;
(c) Statement of cash flows; and
(d) All notes.
(5) If the person obtaining control of the
			 licensee is a startup company or new entity, an initial statement of condition
			 and a proforma income statement shall be submitted instead of the income
			 statement and statement of cash flows;
(6) Evidence that the person obtaining
			 control of the licensee has complied or will comply with all workers'
			 compensation and unemployment compensation laws of Kentucky; and
(7) One (1) of the following, which shall be
			 deposited with and made payable to the commissioner:
(a) An irrevocable letter of credit in an
			 amount required by
			 KRS
			 286.9-040(1)(a);
(b) An Electronic Surety Bond available
			 online at
http://mortgage.nationwidelicensingsystem.org
.
			 The name of the principal insured on the bond shall match exactly the full
			 legal name of the person obtaining control of the licensee;
(c) Evidence that the person obtaining
			 control of the licensee has established an account in a federally insured
			 financial institution in Kentucky and has deposited money of the United States
			 in an amount required by
			 KRS
			 286.9-040(1)(c), with an
			 escrow agreement submitted on Form COMB-3, Escrow Agreement for Check Cashing
			 License or Deferred Deposit Service Business License; or
(d) A savings certificate of a federally
			 insured financial institution in Kentucky established by the person obtaining
			 control of the licensee that is not available for withdrawal except by direct
			 order of the commissioner in an amount required by
			 KRS
			 286.9-040(1)(d), with an
			 escrow agreement submitted on Form COMB-3, Escrow Agreement for Check Cashing
			 License or Deferred Deposit Service Business License.