HCS/SS/SB 1359 - This act modifies provisions relating to financial institutions.CANCER TREATMENT UNDER MO HEALTHNET (Section 208.151)
Under this act, people who receive breast or cervical cancer screenings within the scope of Title XV of the Public Health Services Act and who otherwise meet eligibility requirements is eligible for medical assistance regardless of whether the screening is by a provider that receives funds under that title.
These provisions are identical to HB 2875 (2024).
MOTOR VEHICLE FINANCIAL RESPONSIBILITY (Sections 303.425, 303.430, and 303.440)
This act repeals the requirement that certain notices provided under the motor vehicle financial responsibility enforcement and compliance incentive program (the "Program") specify that the minimum penalty for a violation includes 4 license demerit points. (Section 303.425.7).
The act also limits, to 5 years after implementation, the Department of Revenue's obligation to provide the legislature with annual reports regarding the Program. (Section 303.425.13).
The act specifies that the advisory committee for the Department's motor vehicle financial responsibility verification system shall serve in an advisory capacity as the Department may request, and shall expire 1 year after implementation of the Program. (Section 303.430.2(4)).
Lastly, the act provides that the Department's motor vehicle financial responsibility verification system shall be implemented no later than December 31, 2027, or as soon as technologically possible following development and maintenance of the Department's electronic titling and registration system, rather than January 1, 2025. (Section 303.440).
These provisions are identical to HB 2440 (2024), and substantially similar to SB 1304 (2024).
MONEY TRANSMISSION MODERNIZATION ACT OF 2024 (Chapter 361)
This act repeals the Sale of Checks Law and creates in its stead the "Money Transmission Modernization Act of 2024". The act regulates money transmission, defined as any of the following:
• Selling or issuing payment instruments to a person located in Missouri;
• Selling or issuing stored value to a person located in Missouri;
• Receiving money for transmission from a person located in Missouri; or
• Payroll processing services.
Money transmission does not include the provision solely of online or telecommunications services or network access.
The Director of the Division of Finance within the Department of Commerce and Insurance is responsible for administering this act.
Licensure of Money Transmitters -
The act prohibits any person from engaging in the business of money transmission or advertising, soliciting, or holding itself out as providing money transmission unless the person has been licensed pursuant to this act. Licenses last for no more than one calendar year and are not transferable or assignable. Applications must be on forms required by the Director and shall be accompanied by an application fee, as determined by the Director.
Additionally, certain individuals in control of a licensee, seeking to control a licensee, and any key individual, as that term is defined in the act, are required to furnish background materials to the Director, including fingerprints, criminal background checks, and employment history, among other things listed in the act.
The Director is permitted to implement the licensure process in such a way as to make it consistent with other states and nationwide protocols, to the extent consistent with this act. The Director is additionally permitted to collaborate with the Nationwide Multistate Licensing System and Registry developed by the Conference of State Bank Supervisors (NMLS) as provided in the act.
Confidentiality of Information -
The act provides that all information provided to the Director is considered confidential except basic identifying information of the licensee as detailed in the act. Exceptions are included with respect to disclosures to certain government agencies.
Acquisition of Control -
Any person, or group of persons acting in concert, seeking to acquire control of a licensee shall obtain the written approval of the Director prior to acquiring control. An application must be submitted in a form prescribed by the Director along with a fee, as determined by the Director.
Reporting and Records -
Each licensee is required to submit to the Director the following reports:
• A report of condition each calendar quarter;
• An audited financial statement prepared by an independent certified public accountant at the end of the fiscal year; and
• A report of authorized delegates at the end of each calendar quarter.
A licensee shall file a report with the Director within one business day if the licensee has reason to know of:
• The filing of a petition by or against the licensee under the federal United States Bankruptcy Code;
• The filing of a petition by or against the licensee for receivership, the commencement of any other judicial or administrative proceeding for its dissolution or reorganization, or the making of a general assignment for the benefit of its creditors; or
• The commencement of a proceeding to revoke or suspend its license in a state or country in which the licensee engages in business or is licensed.
A licensee shall file a report with the Director within three business days if the licensee has reason to know of:
• A conviction of the licensee or of a key individual or person in control of the licensee for a felony; or
• A conviction of an authorized delegate for a felony.
A licensee shall maintain the following records, for determining its compliance with this act for at least three years:
• A record of each outstanding money transmission obligation sold;
• A general ledger posted at least monthly containing all asset, liability, capital, income, and expense accounts;
• Bank statements and bank reconciliation records;
• Records of outstanding money transmission obligations;
• Records of each outstanding money transmission obligation paid within the three-year period;
• A list of the last known names and addresses of all of the licensee's authorized delegates; and
• Any other records the director reasonably requires by rule.
Prudential Standards -
Licensees are required to maintain at all times a tangible net worth more than $100,000, or 3% of total assets for the first $100,000,000, 2% of additional assets between $100,000,000 and $1 billion, and 0.5% of additional assets over $1 billion. Additionally, licensees shall maintain security consisting of a surety bond in an amount based on the licensee's average daily money transmission liability and tangible net worth.
The act establishes requirements for permissible investments of a licensee.
Administrative, Criminal, and Civil Enforcement Mechanisms -
The act allows the Director to suspend or revoke licenses and designations of authorized delegates under circumstances and using procedures as described in the act. The Director is also permitted to issue cease and desist orders and enter into consent decrees for the resolution of matters arising under this act.
The act creates the following criminal penalties associated with money transmission:
• A person that intentionally makes a false statement, misrepresentation, or false certification in a record filed or required to be maintained pursuant to this act or that intentionally makes a false entry or omits a material entry in such a record is guilty of a class E felony;
• A person that knowingly engages in an activity for which a license is required pursuant to this act without being licensed and who receives more than $500 in compensation within a 30-day period from this activity is guilty of a class E felony;
• A person that knowingly engages in an activity for which a license is required pursuant to this act without being licensed and who receives no more than $500 in compensation within a 30-day period from this activity is guilty of a Class A misdemeanor.
The Director is also permitted to assess civil penalties not to exceed $1,000 per day for each violation of this act.
These provisions are substantially similar to SB 737 (2024), provisions in HB 2780 (2024), SB 633 (2023), and HB 1340 (2023).
INSURANCE DOCUMENTS (Sections 374.190 and 374.192)
This act specifies that certain confidentiality provisions shall also apply to records used in market conduct investigations and actions.
The act further provides that regulated entities shall have at least 30 calendar days to submit any record or material requested by the Department of Commerce and Insurance, except for the Division of Consumer Affairs or with regard to the policy form approval process. Records maintained beyond the required retention period shall not be required to be produced unless the Director has substantial and competent evidence the regulated entity committed a level 4 or 5 violation of the insurance laws of this state or a felony related to the business of insurance.
These provisions are similar to SCS/SB 1348 (2024).
DISPOSITION OF CERTAIN REINSURANCE CONTRACTS (Section 375.1183)
This act enacts provisions relating to the disposition of reinsurance contracts reinsuring policies of life or health insurance or annuities issued by insurers that have been placed into conservation, rehabilitation, or liquidation as provided in the Insurers Supervision, Rehabilitation and Liquidation Act.
Reinsurance contracts held by the insurers placed in conservation or rehabilitation proceedings or liquidation shall be continued or terminated as provided in the contract and as specified in the act. Reinsurance contracts terminated pursuant to an order of liquidation shall be subject to mandatory negotiation and arbitration procedures specified in the act. (Section 375.1183.1-2).
A guaranty association may elect to assume the liquidated insurer's rights and obligations under reinsurance contracts within 180 days of the order of liquidation as specified in the act. To facilitate this decision, the receiver and each affected reinsurer shall make available copies of reinsurance contracts and related files and records, as well as notices of any defaults under the contracts or any known event or condition which could become a default. (Section 375.1183.3(1)-(2)).
The act further specifies rights and duties of the guaranty association and reinsurers under the reinsurance contracts assumed by the guaranty association, including with regard to premium payments, payment of claims, resolution of disputes over amounts due, and termination or continuation of the contracts. (Section 375.1183.3(3)).
If a receiver continues policies of life or health insurance or annuities issued by an insolvent insurer, and the policies are not covered in whole or in part by a guaranty association, the receiver may elect to assume the liquidated insurer's rights and obligations under reinsurance contracts relating to the policies or annuities within 180 days of the order of liquidation as specified in the act, provided the contracts have not been terminated. In this event, premiums for the applicable reinsurance shall be chargeable against the estate of the insolvent insurer. (Section 375.1183.4).
Between the order of liquidation and the time a guaranty association elects to assume the insolvent insurer's rights and obligations under a reinsurance contract as specified in the act, a guaranty association, receiver, or reinsurer shall not have any right or obligation under any reinsurance contract eligible for assumption under the act. (Section 375.1183.5).
If the guaranty association or receiver does not timely elect to assume a reinsurance contract as provided in the act, the reinsurance contract shall be terminated retroactively, effective as of the date of the order of liquidation, and shall be subject to mandatory negotiation and arbitration procedures specified in the act. (Section 375.1183.6).
When policies or annuities, or the obligations of the guaranty association under the policies or annuities, are transferred to an assuming insurer, associated reinsurance may be transferred to the assuming insurer as well, subject to certain limitations specified in the act. (Section 375.1183.7).
This act shall supercede provisions of law or any affected reinsurance contract with regard to payment of reinsurance proceeds for losses or events occurring after an order of liquidation. (Section 375.1183.8).
When a reinsurance contract is terminated pursuant to the Insurers Supervision, Rehabilitation and Liquidation Act, the reinsurer and the receiver shall commence mandatory negotiation and arbitration procedures laid out in the act. (Section 375.1183.9).
This act shall be construed consistent with the existing power of the Missouri Life and Health Insurance Guaranty Association to assume the rights of insolvent insurers under reinsurance contracts. (Section 375.1183.11).
These provisions are identical to SCS/SB 834 (2024).
SELF-SERVICE STORAGE INSURANCE (Section 379.1640)
This act increases, from $5,000 to $15,000, the maximum insurance coverage that may be offered by limited lines self-service storage insurance producers and their associates.
These provisions are identical to SB 927 (2024).
MUTUAL INSURANCE COMPANIES (Sections 380.621 and 380.631)
This act enacts the "Protecting Missouri's Mutual Insurance Companies Act".
Under the act, chapter 380 shall be the sole authority of the Department of Commerce and Insurance over Missouri mutual insurance companies, and the provisions of that chapter shall not be waived, provided that certain provisions pertaining to premium taxation and insurance holding companies shall still apply as described in the act. The act voids agreements between the Department and mutual insurers as to additional Department authority, but benefits, allowances, and concessions granted to the insurers shall remain in effect for the duration of the agreements.
The act further enacts provisions relating to reinsurance requirements and corresponding filings with the Department, Department review of proposed mergers between mutual insurance companies, and examinations of mutual insurance companies by the Department.
Lastly, the act describes when a mutual insurance company is considered "insolvent", and specifies that mutual insurance companies shall be subject to the Insurers Supervision, Rehabilitation, and Liquidation Act with the exception of certain provisions, and shall be subject to other provisions pertaining to the commencement of court proceedings by the Director of the Department of Commerce and Insurance.
These provisions are similar to HB 2524 (2024).
REAL ESTATE LOANS - AGRICULTURE ACTIVITY (Section 408.035)
Current law prohibits parties from agreeing in writing to any rate of interest, fees, and other terms and conditions in connection with any loan of less than $5,000 secured by real estate used for agricultural activity. This act repeals that prohibition.
These provisions are identical to provisions in HCS/SB 736 (2024), provisions in HCS/HB 2086 (2024), provisions in HCS/HB 2087 (2024), and provisions in HCS/SS/SCS/SB 835 (2024).
CHARGES FOR COST OF CREDIT REPORTS (Section 408.140)
The act permits lenders making loans pursuant to the Missouri Consumer Loan Act to charge consumers for the cost of a credit report.
These provisions are identical to provisions in HCS/SB 736 (2024), provisions in HCS/HB 2086 (2024), provisions in HCS/HB 2087 (2024), and provisions in HCS/SS/SCS/SB 835 (2024).
COMMERCIAL FINANCING DISCLOSURE LAW (Section 427.300)
This act creates the "Commercial Financing Disclosure Law". Under this act, any person who consummates more than 5 commercial financing transactions, as defined in the act, to a business located in this state in a calendar year is required to make certain disclosures to the business with regard to the transaction. Specifically, the provider is required to disclose the following:
• The total amount of funds provided to the business under the terms of the commercial financing transaction;
• The total amount of funds disbursed to the business under the terms of the commercial financing transaction, if less than the total amount of funds provided, as a result of any fees deducted or withheld at disbursement and any amount paid to a third party on behalf of the business;
• The total amount to be paid to the provider pursuant to the commercial financing transaction agreement;
• The total dollar cost of the commercial financing transaction under the terms of the agreement, derived by subtracting the total amount of funds provided from the total of payments;
• The manner, frequency and amount of each payment; and
• A statement of whether there are any costs or discounts associated with prepayment of the commercial financing transaction including a reference to the paragraph in the agreement that creates the contractual rights of the parties related to prepayment.
The act requires registration with the Division of Finance prior to engaging in business as a broker for commercial financing. Specifically, the act requires filing a registration form, submitting a fee of $100, and obtaining a surety bond in the amount of $10,000. A registration renewal is required every year, not later than January 31st.
Violations of these provisions are punishable by a fine of $500 per incident, not to exceed $20,000 for all aggregated violations. Any person who violates any provision of this act after receiving written notice of a prior violation from the Attorney General shall be punishable by a fine of $1,000 per incident, not to exceed $50,000 for all aggregated violations arising from the use of the transaction documentation or materials found to be in violation of this act.
Violation of any provision of these provisions does not affect the enforceability or validity of the underlying agreement.
This act does not create a private cause of action against any person or entity based upon noncompliance with this act.
The Attorney General is given exclusive authority to enforce these provisions.
These provisions contains various exemptions.
The registration and disclosure requirements of these provisions take effect either (1) 6 months after the Division of Finance finalizes promulgating rules, if the Division intends to promulgate rules; or (2) February 28, 2025, if the Division does not intend to promulgate rules.
These provisions are substantially similar to provisions in HCS/SB 736 (2024), and SB 753 (2024), HCS/SS/SCS/SB 835 (2024), HB 2063 (2024), HCS/HB 2087 (2024), HB 2780 (2024), HCS/SCS/SB 187 (2023), SCS/HB 585 (2023), provisions in HCS/HB 809 (2023), HCS/HB 584 (2023), SCS/SB 963 (2022), provisions in SCS/HB 2571 (2022), and HB 2706 (2022).
REAL ESTATE TRANSACTIONS - WOMAN'S STATUS AS WIFE (Section 442.210)
A provision of law is repealed requiring description of a woman's status as "wife" when executing a certificate of acknowledgment form in the course of a real estate transaction with her husband.
These provisions are identical to provisions in HCS/SB 736 (2024), HCS/HB 2086 (2024), and HCS/HB 2087 (2024).
ERIC VANDER WEERD