Industry Letter

Department Issues Guidance to New York State Licensed Check Cashers Applying for Approval to Operate at a New Check Cashing Location

April 14, 2021

To the Licensed Check Casher Addressed:

This Industry Letter is issued by the Department to remind principals of licensed check cashing entities of the requirements and expectations of the Department with respect to evidence of possession, by lease of the location where the check cashing business will be conducted, in connection with new license applications. As is more fully discussed below, a letter from the property owner or rental agent stating that the applicant or licensee has or will obtain possession of the proposed location can be used in lieu of a lease.

New York Banking Law Article IX-A and Superintendent’s Regulations Part 400 govern the application requirements for engaging in the business of cashing checks, drafts and/or money orders. Part 400.1 (c) (8) of the Superintendent’s Regulations states in relevant part:

“In the case of an application for a new license, a copy of the deed to the property on which the check cashing business will be conducted or a copy of the contract to purchase such property or, if the proposed licensed location is leased or to be leased, a copy of the lease or proposed lease or a letter from the owner or its agent that the applicant has obtained or will obtain possession of the proposed licensed location. All leases shall be for a term of at least three years. For a change of control application wherein succession to the licensee’s business premises does not occur by operation of law, the applicant shall provide evidence to the satisfaction of the superintendent that the lease(s) for the licensed locations will be assigned or sublet to the applicant or that a new lease(s) will be given the applicant if the applicant is not purchasing the property.” (emphasis added)

Consistent with the Superintendent’s Regulations cited above, the related Check Casher Application Checklists for a new license states in relevant part:

“An acknowledgement letter from the landlord or rental agent may be used to demonstrate that the applicant/licensee has (or will have) possession of the proposed licensed location for a minimum of three years following the issuance of a license and commencement of business. If the 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.”

The Department reiterates that an application for a new license stemming from a relocation, change of control or a new branch, can, consistent with Superintendent’s Regulations Part 400.1(c)(8) and as further amplified by the Check Casher Application Checklists, submit a letter from the property owner or its rental agent that the applicant has obtained or will obtain possession of the proposed licensed location. Similarly, in the case of a change of control application, the applicant can also submit evidence, in the form of an acknowledgement letter from the property owner or its rental agent, that the lease(s) for the licensed locations will be assigned, sublet, or a new lease will be given to the applicant.

For the avoidance of doubt, this Industry Letter does not eliminate the need for an applicant to provide a complete application at the time of submission. Moreover, the Department notes that prior to occupying a new location, the applicant must forward a copy of the lease to the Department.

This Industry Letter is also available on the Department’s website at:
https://www.dfs.ny.gov/apps_and_licensing/check_cashers/application_resources

Sincerely,

Wendy Henry
Deputy Superintendent
Licensed Financial Services
Banking Division