Idaho Money Transmitter Surety Bond

The Idaho Department of Finance (the Department) regulates money transmitters, collection agents, banks and credit unions, consumer lending agencies, mortgage brokers and loan originators, securities and escrow agencies. The Department issues licenses for money transmitters through the National Multistate Licensing System (NMLS), ensures conformance of state laws, can enforce penalties and fines against licensees failing to meet state requirements including revocation of licenses, and provides a security device element in the event a licensee fails to perform the duties to meet the state requirements.

Obligee and Bond Conditions:

The obligee is the entity that requires the bond. The Idaho Department of Finance requires a application for licensing and a minimum $10,000 security device. The security device can be a surety bond, an irrevocable letter of credit, or a similar security device. A surety bond ensures compliance of regulations and state laws. Failure to comply or perform as required by state laws and regulations may result in a claim filed against the bond by the Department. In the instance of a surety bond, if the Department files a claim against the surety bond, the owner (named as the principal on the bond form) will be responsible for repayment of the claimed amount if the claim is paid out by the surety. If another form of security device was used, the device will be forfeited when a valid claim has been made.

The surety bond must be in place from the time the license is issued, during all business operations and for the following two years after operations cease. The premium will renew on the bond on an annual basis. If the money transmission business changes ownership, a replacement bond is required to fulfill the security device conditions. Failure to maintain or replace the surety bond or security device will result in penalties by the Department.

Surety Bond Requirements:

When a surety bond is chosen as the security device, the bond amount is based on the number of locations. A minimum $10,000 surety bond is required and will increase by $5,000 for each additional business location up to a maximum surety bond amount of $500,000.

The original surety bond will need to be submitted to the Idaho Department of Finance directly when applying for a license or a rider to the bond if adding additional locations after the initial license is issued. The bond form should not be sent to the NMLS.

License Requirements:

1. Complete the license application found on the NMLS website and pay the application and NMLS fees.
2. Applicants must provide any trade names or doing business as names, business locations and authorized agent, as well as sample copies of authorized delegate contracts.
3. Provide a business plan detailing how money will be collected and transmitted, the method of record keeping and how the records are to be stored.
4. Provide an organizational chart if the applicant is owned by another entity, subsidiary, affiliated entity, or person.
5. Provide the business MSB registration number on the FinCEN Registration line.
6. If any of the disclosure questions are answered “Yes,” provide documentation to support the answer.
7. Provide bank account information that will be associated with the business.
8. Provide a copy of the proposed or current AML program.
9. Money transmitter businesses must demonstrate a minimum net worth of $50,000 for the main location and $25,000 for each additional location up to a maximum of $250,000. Provide copies of audited financial statements that includes a balance sheet, statement of income, statement of shareholder equity, and statement of changes in financial position. If the business is subsidiary of a publicly traded corporation, provide either a current financial statement or the parent company's Form 10K reports for the preceding three years, along with the applicant’s unaudited financial statements. If the corporation is publicly traded outside the United States, provide financial documents that are similar to the Form 10K and the applicants unaudited financial statements.

How Much will This Bond Cost?

The premium that you pay for an Idaho Money Transmitter Surety Bond is dependent on credit and the number of business locations. Our rates start at 1.5% of the bond amount with good credit. Bond amounts exceeding $50,000 will require business and personal financial statements. Contact our Surety Bond Specialists for a free quote that fits your specific situation.

Did you Know?

Money transmitters are defined as money and wire remitters, money order issuers and sellers, traveler check issuers and sellers, payment processors, virtual currency exchangers, delayed delivery of currency or stored value providers, open and semi-closed loop prepaid and stored value cards.

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