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Instructions : Licensed Casher of Checks

There is a separate application that accompanies these instructions which must also be downloaded from the website.

The Department of Financial Services licenses and regulates all check cashers in New York State (NYS). Check cashers are subject to the provisions of Article 9-A of the Banking Law, Part 400 of the Superintendent’s Regulations, other applicable laws and regulations, as well as the Department policies. An updated list of licensed check cashers can be found on our website.

The Department establishes the maximum fee which a check casher may charge for cashing a check for a natural person. Fees for cashing checks are adjusted annually and are posted on the Department’s Annual Assessment Fees page.

The Department also seeks to protect the public by investigating the character, experience, financial responsibility and general fitness of all individuals associated with the check cashing industry. The principals and employees of every applicant must be registered with the Department and fingerprinted. Applicants must therefore comply with the fingerprinting requirements. More specific instructions are included within the application forms. Kindly refer to the Fingerprinting Procedures posted on our website. If you have any questions concerning this procedure, please contact the Department at (212) 709-5507.

License requirements and application procedures are outlined in the Banking Law (BL) and Superintendent’s Regulations (SR). Every licensee and applicant should be familiar with these statutes and regulations a copy of each can be obtained by accessing the websites noted below. These instructions supplement the statutory and regulatory requirements and procedures.

Application forms may be obtained on our website.

(Note: Forms in the Check Casher Application package may be reproduced but should not be altered in any way. When completing the application do not leave any blank or unanswered questions.)

In addition to the forms provided in the application package, a variety of supplementary material must either be submitted with the application or ordered by the applicant from 3rd parties and sent directly to LFS. These instructions describe the application process, the forms provided in the application package, and the supplementary material needed for various types of applications. Please note that pursuant to Section 400.1(c)(10) of the Superintendent’s Regulations additional information may be requested in order to complete our due diligence process and satisfy statutory requirements.

APPLICATION PROCESSING

Upon receipt, each application is reviewed by LFS to determine if it is substantially complete. Following this review, details of every substantially complete application are published in Section I of the Department’s Weekly Banking Bulletin. Applicants/licensees submitting incomplete applications will receive written notification of the reason(s) their application was found to be incomplete and an itemized list of its deficiencies. In cases where the application deficiencies are too extreme, the entire application package will be returned to the applicant.

FEES

Fees for each Check Casher Application filed are prescribed within Section 18-a of the Banking Law.

They are as follows:

Original License and Change of Control Applications - $3,000
Additional Branch, Mobile and Change of Location - $2,000
Limited Station License - $500
Change of Mobile Location - $500

Note: Investigation fees are non refundable. Where an applicant operates several places of business, each location requires a separate license and application.  Please make checks payable to the Superintendent of Financial Services.

APPLICABLE LAWS AND REGULATIONS

NET LIQUID ASSETS, CAPITAL AND LINE OF CREDIT REQUIREMENTS

All applicants for a check cashing license must demonstrate that they are adequately capitalized and financially responsible by having net liquid assets of at least $10,000 for each location and by obtaining a credit facility letter showing an existing right of access to a line of credit in an amount of not less than $100,000 provided by a banking institution or similar credit facility approved by the Superintendent, for each location.  By Department policy the Superintendent requires $50,000 in tangible net worth be maintained for each licensed location.

QUALIFIER EXPERIENCE

Every applicant must have at least one year of managerial/supervisory experience in the check cashing business in New York State or hire a person with such experience or equivalent background.

GENERAL ASSESSMENT CHARGES

Once licensed, a check casher will be charged an annual general assessment fee. This assessment consolidates all of the Department operating costs and is payable in four installments.  Please see the Department’s website under Industry and Circular Letters to review the latest Assessment Calculator Charts, to determine costs and factors relevant to licensed check cashers and to approximate your assessment amount.

FILED APPLICATIONS

No application will be published in the Department’s Weekly Banking Bulletin until all information and documents required by all applicable laws and regulations as determined by the Superintendent are received and evaluated by Department staff. If you have questions concerning the preparation and filing of an application, please contact LFS at (212) 709-5507.

APPLICATION FORMS

REQUIRED SUPPLEMENTARY DOCUMENTATION

Supplementary documentation must accompany every application submitted to the Department. This material is determined by the type of application being filed. The enclosed “Supplementary Material Required” chart identifies specific documentation required with various types of applications.

  1. Business Formation Documents - For Corporations, Limited Liability Companies(LLC) and Partnerships: Documents must be certified by the NYS Secretary of State or the clerk of the counties in which business is to be conducted and must be certified within six (6) months of the date of application. For Foreign entities, submit documents that have been certified by the respective Secretary of State.
    1. Certificates of Incorporation for a Corporation; Articles of Organization for a Limited Liability Company (LLC); Certificate of Limited Partnership for a Limited Partnership; or Certificate of Registration of a Limited Liability Partnership – Submit as applicable. Documents must be certified by the NYS Secretary of State.
    2. Assumed Name Certificate - Certified by the NYS Secretary of State or clerk of the county/ies in which the business is conducted. Corporations, LLC’s and Limited Partnerships proposing to conduct business under an assumed name must apply to the Secretary of State for authorization to do so. Individuals and general partnerships proposing to conduct business under an assumed name (i.e., d/b/a) must apply to their local county clerk for permission to do so. In either case, certified copies of the applicable authorization must accompany any application filed.
    3. Businesses formed in other states (i.e., foreign entities) - Submit copy of its Application for Authority to do Business in NYS, certified by the NYS Secretary of State.
    4. Copies of any amendments and/or changes to the business formation - These forms also must be certified by the Secretary of State.
    5. Copies of Incorporation or Organization filing receipt(s).
    6. Corporate By-Laws, Operating or Partnership Agreements need to be certified by an officer of the applicant.
  2. Evidence of Worker’s Compensation and NYS Disability coverage. Evidence that such coverage has been (or will be) obtained must accompany any application filed by an unlicensed entity.
  3. A certified copy of the Board Resolution or minutes approving the proposed change in control. Changes in the ownership structure of a corporate licensed check casher must be approved by its Board of Directors and documentation providing evidence of this approval must be included with every application seeking approval for such a change.
  4. Statement explaining the reason(s) the licensee is seeking to relocate. An application for a change in location must include a statement providing the reasons for the relocation.
  5. A copy of the title certificate, lease, or letter from the landlord or rental agent indicating the licensee/applicant has (or will) obtained possession of the proposed location for a minimum term of three years following the commencement of business. Appropriate documentation must accompany every application involving a new licensed location or change of control of an existing location.
  6. The floor plan and interior dimensions of any proposed licensed location certified by an NYS licensed architect, building engineer or land surveyor. The documentation provided must demonstrate that the proposed location comprises a minimum of 480 square feet of contiguous space.  For changes of control of existing licensed locations, an affidavit from the licensee, that no alterations have been made to the premises since original licensing, may be acceptable.
  7. A ‘Business Plan’ providing the information specified in S.R. 400.1(c)(7). Submit a business plan that satisfies the requirements of S.R. 400.1(c)(7).  
  8. Community Need Study - In addition to a business plan, a detailed community need study is required for applications for new locations or if the applicant is relocating more than 1,584 feet [3/10's of a mile] from its current location.  Information provided should explain how the proposed facility will benefit the community. All demographic information included should correspond to the ‘primary market area’ designated by the applicant and must be documented. Demographic data for specific Census tract(s) or Zip codes may be obtained from the U.S. Census Bureau. This information may also be available from local government offices.
  9. Contract of Sale, Asset Purchase Agreement or equivalent contract. Any application seeking approval for a change in control of a licensee must include the applicable contract(s) that detail the terms and conditions of such a change.
  10. The applicant’s current financial statements.
  11. The applicant’s pro forma balance sheet as of the opening of business. Note that, effective December 31, 2002, LFS policy requires every licensee to maintain a minimum tangible net worth (defined total assets, less total liabilities, less intangible assets such as goodwill, patents, copyrights, trademarks, and logos, and non-compete covenants and any other assets designated as intangible by Generally Accepted Accounting Principles) of $50,000 per licensed location. Applicants that do not meet this requirement when an application is filed must provide evidence showing how they will meet this requirement prior to the issuance of the proposed license.
  12. The applicant’s projected income and expense statement for the first year of operation at the proposed location.
  13. Evidence of the source of investments in, or loans to, the licensee/applicant by any officer, director, stockholder, member, partner, owner, or any other party.
  14. A facility letter from a bank demonstrating access to a line of credit in the amount of $100,000 or more for the proposed location. This facility letter should be sent directly to the Department. In many cases, the bank providing the credit facility will condition the final approval and availability of this line upon the Department’s approval of a license for the proposed location. This condition is acceptable. If the credit officer at the applicant’s bank has any questions about the requirements for such a facility, he/she should contact the LFS application unit.
  15. Depository Account Agreement – The applicant is required to submit a copy of an executed written account agreement with an FDIC insured financial institution, under which the account will be used to deposit all checks, drafts and money orders.  The agreement should expressly provide for personal and in rem jurisdiction over the parties and the account, respectively, of State and Federal courts located in the State of New York, and shall be governed by the laws of the State of New York.  In addition, the financial institution shall give the superintendent written authorization to conduct any such examination of all books, records, documents and materials, including those in electronic forms, as they relate to such account, as the superintendent in his/her discretion deems necessary (see Superintendent Regulation 400.4(a)2 and 3).
  16. A company check or money order payable to the “Superintendent of Financial Services” representing the application investigation fee. Refer to B.L. Section 18-a, for details of the amount of the applicable investigation fee that must accompany the application. This fee is not refundable.
  17. Bank Secrecy Act compliance manual(s). As a ‘money service business’, check cashers must register with the Financial Crimes Enforcement Network (FinCEN) and develop policies and procedures to ensure compliance with the Bank Secrecy Act (BSA). An applicant for a license as a casher of checks must supply a copy of its BSA compliance manual. Information about these topics may be obtained at the following websites:
    www.fincen.gov or www.msb.gov.
  18. Acknowledgment from Landlord or Rental Agent.  This form may be used to demonstrate that the applicant/licensee has (or will have) possession of the proposed licensed location for a minimum term of three years following the issuance of a license and commencement of business.  If a licensed location is being acquired and the existing lease is assigned to the applicant, then a letter from the landlord or rental agent consenting to the assignment of the lease is required, along with a copy of the original lease.
  19. Background Investigation Reports - In connection with your application to organize a financial services entity supervised by the Department, an investigative background report is required. It is the responsibility of the applicant and its principals to order such reports at their own expense from an independent New York State licensed private investigation company.  Reports should be ordered on every individual with an ownership interest in the applicant; the officer(s) who satisfy the experience requirement of S.R. 400.1(c)(5); the compliance officer and any other individual(s) who have managerial or supervisory responsibilities, and on any individual seeking approval for a change in control of an existing licensed check casher. A new report is required if the previously submitted ones are more than three (3) years old.
  20. FINCEN Registration – The applicant is required to submit evidence that it has registered with FINCEN as a Money Service Business.  A copy of FINCEN’s confirmation or acknowledgement letter will be sufficient.  To register with FINCEN go to www.fincen.gov.

Please note that all background investigation reports must be provided directly to the Department by the private investigation company. These reports should be ordered early and prior to filing the application(s) since they may take almost 8 weeks to be completed and delivered to the Department. Failure to promptly order the reports may delay application processing. These reports should be sent to:

New York State Department of Financial Services
Licensed Financial Services
One State Street
New York, NY 10004-1511

New York State Department of Financial Services Required Background Investigation Information

The following listing relative to such background reports specifies all requirements and must be submitted as part of the application process. No background report will be considered complete unless all the information requested below is included in the investigation report.

  1. Comprehensive credit report/history (include the actual report as well as summary).
  2. *Civil Court and Bankruptcy Court records for the past 10 years.
  3. *Criminal records (felonies, misdemeanors and violations).

    * Include federal, state and local courts. Such reports shall contain, at a minimum, court data from courts located in counties in which the applicant both worked and resided and all counties contiguous to those counties.

  4. Education records.
  5. Employment history.
  6. Personal and professional references (at least three of each, excluding relatives), which must be furnished in writing.
  7. Media history, if applicable (including electronic search of national and local newspapers, wire services and business publications).
  8. Regulatory history, if applicable (HUD, FREDDIE MAC, State Regulators, OCC, FINRA, etc.).
  9. Department of Motor Vehicle records.
  10. All judgments and liens filed with the county clerk (within the past ten years). Such reports shall contain, at a minimum, information on judgments and liens filed with the county clerk in counties where the applicant worked and resided and all counties contiguous to those counties.
  11. Licenses granted by any governmental agency or judicial body. (Indicate if they are still in good standing.)
  12. Listing of all credit relationships by the applicant such as revolving credit and established credit facilities. Indicate any credit extensions, including loans, on which the applicant is in default (more than 90 days past due).

Forms

          Application Forms Required 

New Licensee

New Location

Change of address

Change in Control

1

Application

X

X

X

X

2

Personal Forms [for every owner and officer(s) satisfying the experience requirements of S.R. Section 400.1(c)(5)] and Compliance Officer.

X

X/Y

X/Y

X/Y

3

Litigation Affidavit – Applicant.

X

X

X

X

4

Compliance Affidavit.

X/Y

X/Y

X/Y

X/Y

5

Fingerprints for every individual not previously registered with the Department.

X/Y

X/Y

X/Y

X/Y

6

Transmitter of Money Agent Application [if the licensee/applicant will act as an agent for a licensed transmitter of money at the specified location].

X

X

X

X

 

          Supplementary Material Required

 

 

 

 

A

Business Formation Documents

X

X

X

X

B

Evidence of Worker’s Compensation and NYS Disability Insurance coverage.

X

X

X

X

C

Certified copy of the Board Resolution or minutes approving the change in control.

 

 

 

X

D

Statement explaining the reason(s) for relocating.

 

 

X

 

E

A copy of the title certificate, lease, or letter from the landlord/rental agent indicating the licensee/applicant has [or will have] possession of the proposed location for a minimum term of three years following the commencement of business.

X

X

X

Y

F

Floor plan and interior dimensions of the proposed location as certified by a NYS licensed architect, building engineer or contractor.

X

X

X

Y

G

A “Business Plan” providing the information specified in S.R. 400.1(c)(7).

X

X

X

X

H

Community Need Study

X

X

X/Y

 

I

Contract of Sale or equivalent Agreement

 

 

 

X

J

The applicant’s current financial statements

X

X

X

X

K

The applicant’s pro forma balance sheet as of the opening of business.

X

X

X

X

L

The applicant’s projected income and expense statement for the first year of operation at the proposed location.

X

X

X

X

M

Evidence of the source of investments in, or loans to, the licensee/applicant by any officer, director, stockholder, member, partner or owner.

X

X

X

X

N

A facility letter from a bank demonstrating an existing right of access to a line of credit in the amount of $100,000 or more.

X

X

X

X

O

Company check or money order payable to the “Superintendent of Financial Services” representing the investigation fee.

X/Y

X/Y

X/Y

X/Y

P

Bank Secrecy Act compliance manual.

X

X

 

Y

Q

Affidavit re: Lease of Real property

Y

Y

Y

Y

R

Background Investigation Report

X

Y

Y

X

S

FINCEN Registration Confirmation

X

X

 

X

 

 

 

 

 

 

Legend

X

Required.

 

 

 

 

Y

Refer to Instructions