HOUSE DOCKET, NO. 3964        FILED ON: 11/18/2013

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The Commonwealth of Massachusetts

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PRESENTED BY:

Danielle W. Gregoire

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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:

The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:

An Act relative to check cashing fraud.

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PETITION OF:

HOUSE DOCKET, NO. 3964        FILED ON: 11/18/2013

HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No.         

The Commonwealth of Massachusetts

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In the Year Two Thousand Thirteen

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An Act relative to check cashing fraud.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
 

Chapter 169A of the General Laws is hereby amended by adding the following 3 sections:-

Section 14. (a) Each licensee shall keep and use within the commonwealth its books, records and accounts in a manner that shall allow the commissioner to determine whether the licensee is complying with this chapter, any regulations promulgated hereunder and any applicable state or federal laws. At a minimum, the following records shall be maintained:

(1) A daily record of checks cashed shall be maintained as a record of all check cashing transactions occurring each day. Such daily record shall be limited to the following, provided that a sufficient audit trail is available through records obtainable from the licensee's bank of account:

(i) the amount of the check cashed;

(ii) the amount of fee charged for cashing the check;

(iii) the name and address of the endorser. Proof of residence, which shall be in the form of a valid Massachusetts driver’s license or other valid Massachusetts ID, shall be presented at the time of cashing the check;

(iv) the number of the Massachusetts driver’s license or other Massachusetts ID used to establish proof of residence in clause (iii); and

(v) the check originator name and address.

(2) A daily cash reconcilement shall be maintained summarizing each day's activity and reconciling cash on hand at the opening of business to cash on hand at the close of business. Such reconcilement shall separately reflect cash received from the redemption of returned items, bank cash withdrawals, cash disbursed in cashing of checks and bank cash deposits.

(3) Records required pursuant to this section may be maintained in combined type form. Handwritten format is not acceptable.

(4) A general ledger containing records of all assets, liabilities, capital, income, and expenses shall be maintained. The general ledger shall be posted from the daily record of checks cashed or other record of original entry, at least monthly, and shall be maintained in such manner as to facilitate the preparation of an accurate trial balance of accounts in accordance with generally accepted accounting practices. A consolidated general ledger reflecting activity at 2 or more locations by the same licensee may be maintained provided books of original entry are separately maintained for each location.

(b) Every Licensee shall preserve its books and records for inspection for a minimum of 3 years.

(c) In addition to the reports required by law, a licensee shall make such other statements and reports to the commissioner as he or she may require. The commissioner may furnish blank forms for all such statements or reports.

Section 15. (a) On a quarterly basis beginning on January 1 of each year, each licensee shall file a quarterly report with the commissioner for the preceding quarter. The report shall be in writing, subscribed by the licensee under the pains and penalty of perjury.

(b) The form of such quarterly report shall be prescribed by the commissioner and may provide differentiations or adjustments for a licensee required to submit quarterly reports to the commissioner pursuant to other provisions of law or regulations of the division of banks and loan agencies.

Section 16. (a) A licensee shall notify the division of banks and loan agencies in writing within 1 business day of the occurrence of any of the following developments:

(i) licensee filing for bankruptcy or reorganization;

(ii) notification of the institution of license revocation procedures in any state against the licensee;

(iii) the filing of a criminal indictment any way related to check cashing or selling activities of a licensee, an officer, director, or principal, including, but not limited to, the handling or reporting of moneys received or instruments sold; and

(iv) a licensee, officer, director or principal being convicted of a crime.

(b) Failing to comply with the requirements of subsection (b) or cashing a check in excess of $500 shall be grounds for a license revocation pursuant to section 8 and the issuance of a cease and desist order pursuant to section 9.