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Licensing Requirement For Check Cashing Businesses
by: Ken Gollher, BOL Guru
BIO AND CONTACT INFO
Question: I attended a BSA seminar presented by Ken Golliher in January 2002. In my notes I have the statement "Florida Law requires a business to be licensed by the state if 5% of gross revenue is derived from check cashing fees; therefore becomes a financial institution and would be exempt". I would like to verify that this is a true statement and if so were can I obtain support documentation?
Answer: I claim a combination of innocence and ignorance.
First, it was an attendee, not me, who stated the "5% of revenue" test as subjecting the business to regulation by the state as a financial institution.
Second, I have no idea whether he was correct in his assertion. However, I will put this question in play to see if a Florida banker familiar with any such requirement will pick up on it and post something in Bankers' Threads.
Either way, BSA has its own test for how much of a business's revenues would have to be derived from "financial institution" activities to make it ineligible (51%). Federal law would take precedence in determining eligibility for exemption.
First published on BankersOnline.com 3/4/02
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