Legislature(2015 - 2016)BARNES 124
04/11/2016 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB234 | |
| Alaska Workers' Compensation Board | |
| HB271 | |
| SB127 | |
| SB142 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 234 | TELECONFERENCED | |
| += | HB 271 | TELECONFERENCED | |
| += | SB 127 | TELECONFERENCED | |
| += | SB 142 | TELECONFERENCED | |
HB 271-MONEY SERVICES BUSINESS: REQS; LICENSING;
4:20:05 PM
CHAIR OLSON announced that the next order of business would be
HOUSE BILL NO. 271, "An Act relating to a money services
business; relating to transmitting value that substitutes for
money; relating to licensing requirements and registration
through the Nationwide Multistate Licensing System and Registry;
relating to surety bonding requirements; authorizing certain
licensees to contract to use subdelegates for reloading funds
onto stored-value cards; relating to record retention, reporting
requirements, and enforcement provisions; relating to
exemptions; relating to money services Internet activities;
relating to definitions regarding the transmitting value,
currency, and money transmission business activities; and
providing for an effective date."
4:20:13 PM
REPRESENTATIVE HUGHES moved to adopt the committee substitute
for HB 271, Version [29-GH2067\H], Bannister, 4/4/16, as the
working document.
CHAIR OLSON objected for discussion purposes.
4:20:35 PM
KEVIN ANSELM, Director, Division of Banking and Securities,
Department of Commerce, Community & Economic Development
(DCCED), answered questions raised at a previous meeting
regarding the money services business, including some ancillary
issues such as gift cards and pre-paid cards. She provided a
copy of a Wikipedia sourced list of the various virtual
currencies available. Ms. Anselm paraphrased the summary of
changes made by Version H as follows [original punctuation
provided]:
In general, Legislative Counsel made conforming
drafting, legal and organizational improvements
throughout the bill including expanding definitions to
include related concepts, products or practices.
Summary of Changes
Article 1. Money Transmission Licenses. Sec. 1- 13. No
substantive changes.
Article 2. Currency Exchange Licenses. Sec. 14 - 22.
No substantive changes.
Article 3. Authorized Delegates. Sec. 23- 25.
Sec. 23. AS 06.55.301(b). Retains "remit"
definition from the current law in this Article
instead of in the definition section and adds a
listing of the financial institutions eligible to
receive authorized delegate deposits. Proposed
language relating to licensee responsibility for the
acts of an authorized representative was deleted.
(former Sec. 20)
MS. ANSELM explained the aforementioned language was deleted
because it was clear the division had the same authority
elsewhere in the bill.
Article 4. Examinations, Report and Records. Sec. 26-
37
Sec. 27. AS 06.55.402 Consultation was added to
"Cooperation" in the title of former Sec. 23 relating
to working with other regulators.
MS. ANSELM related that not only does the division cooperate but
also consults.
Sec. 31. AS 06.55.404(a) Modified former Sec. 27
to require a licensee to give the department notice of
a change of control 30 days before the proposed change
of control and request approval with the required
information and fee instead of within 15 days after
learning of a proposed change of control.
MS. ANSELM clarified that there is only one date, which is 30
days before a proposed change. Elsewhere in the law, there is a
provision to notify the division within 15 days, if there is a
change.
Article 5. Permissible Investments. Sec. 38-39. No
substantive changes.
Article 6. Enforcement. Sec. 40-49. No substantive
changes.
Article 7. Administrative Procedures. Sec. 50. No
substantive changes.
Article 8. Miscellaneous Provisions. Sec. 51- 54.Sec.
54. AS 06.55.855. New section that describes how
references to virtual currency will be construed.
4:23:58 PM
MS. ANSELM explained that in addition to a definition of virtual
currency, which has been expanded, there is also a description
in lay terms that describes how those references will be
construed.
Article 9. Definitions. Sec. 55 - 65. Sec. 56 - 65
reordered the definitions in former Sec. 50.
MS. ANSELM said the definitions were reordered. The definitions
already existing in law are in the same order, any changes stay
in the same order, and new definitions are added at the end.
The original bill had alphabetized the definitions and this will
place them back into "date" order.
Notable changes include:
Sec. 56. AS 06.55.990(3) "control" is more
precisely defined. Formerly Sec. 50(4)
Sec. 58. AS 06.55.990(15) "money transmission" is
expanded to include explanations of the activities
included in an informal transfer system, open-loop
stored value devices, virtual currency, and retail
conversion services, including those definitions or
referencing definitions that were formerly separated
in Sec. 50.
4:25:09 PM
MS. ANSELM related that this helps people to understand how
these various sorts of money transmission services meet.
Sec. 66-73. No substantive changes.
4:26:02 PM
CHAIR OLSON withdrew his objection. There being no further
objection, Version H was before the committee.
REPRESENTATIVE HUGHES commented that this is a complicated bill
and she requested a written updated sectional analysis,
including a summary of changes.
MS. ANSELM agreed to provide further information.
CHAIR OLSON noted that public testimony was closed during the
last meeting.
4:27:33 PM
REPRESENTATIVE KITO expressed concern regarding the regulating
of fees, and about having fees on cards identified as specific
profit centers by companies, so that a consumer might not be
aware that they are paying a lot of money in order to maintain
these instruments. He asked whether there is a way that the
legislature can protect consumers from overcharges on some of
these types of instruments.
MS. ANSELM advised that the division reviews the fees, during
examinations, as well as when the firms are initially licensed.
There are three different examples of fees being charged in
Alaska currently on prepaid cards. She explained that the
division doesn't have limits on those fees but that could be
done by regulation. She pointed out that nationally, similar
fees are substantial; it takes quite a bit of administrative
work to keep multiple accounts current. Ms. Anselm said she is
aware there are some costs involved, but she would research that
issue to determine whether it makes sense to regulate a
limitation on fees, and to see what other states do.
4:29:19 PM
REPRESENTATIVE HUGHES moved to report the committee substitute
for HB 271, [29-GH2067\H,] Bannister, 4/4/16, out of committee
with individual recommendations and the accompanying fiscal
notes. There being no objection, CSHB 271(L&C), was reported
out of the House Labor and Commerce Standing Committee.