Utah Money Transmitter License Surety Bond

The Utah Department of Financial Institutions (UTDFI), otherwise known as the Department, regulates and administers the money transmitter program and has oversight of the licensing, as well as handling of consumer complaints and auditing. The Department has assigned the license application process to be done through the Nationwide Multistate Licensing System (NMLS). A money transmitter license in Utah allows for activities such as electronic money transmission, check cashing, selling and issuing of traveler's checks, selling and issuing of money orders, and selling and issuing of prepaid access.

The Utah Money Transmitter Act (Title 7 Chapter 25 Part 2) requires any person providing money business services including money transmitters to first obtain a license. A minimum $50,000 surety bond will be required when applying for the license.

Surety Bond Requirements:

The obligee is the entity that requires the surety bond to be on file. The obligee is the Utah Department of Financial Institutions. The surety bond is required to protect consumers in the event a money transmitter (the licensee) fails to comply with the state regulations and if found in violation, the penalty will be paid for from the bond. The licensee (the principal listed on the bond) is responsible for the claimed amount and If the surety pays the claim, the principal is required to reimburse the surety for the loss.

A minimum $50,000 surety bond is required and the bond amount may be increased at the discretion of the Department.

License Requirements:

1. Pre-requisites to applying for a license: no criminal convictions or material litigations within seven years from the anticipated date of application. This includes key shareholders, directors and executive officers. And, the company must be in good standing with the state.
2. Complete the license application and provide the primary contact employee information and submission of company form, dba or trade name, and the resident or registered agent. Pay the license registration fee and if applicable, the Uniform Authorized Agent Reporting Annual Processing Fee.
3. Provide a certificate of good standing (that is dated not more than 60 days prior to the application filing date).
4. Obtain a minimum $50,000 surety bond. The surety bond will be uploaded directly into the NMLS system by the issuing surety.
5. Provide audited financial statements that prove a company net worth of at least $1,000,000. The financial statements need to include a balance sheet, statement of income or loss, and statement of cash flow dated within 90 days of the business fiscal year end date.
6. Provide sample copies of sample documents and other forms to be used in the course of business, a business plan, an organizational chart, and provide the most current review of the applicants Anti-Money Laundering (AML) Policy.
7. Complete the Control Person Attestation (Form MU2) for each person that has control of the company.
8. Complete the Authorized Agents and Locations functionality (in NMLS) to add or delete the list of agents that will have authorization to conduct money transmission services.
9. Provide explanations for any disclosure statements answered “yes.”

How Much Will This Bond Cost?

The premium that you pay for a Utah Money Transmitter Surety Bond is dependent on credit and the bond amount required. Our rates start at 1.5% of the bond amount with good credit. Personal and business financial statements will be required for the underwriting process for bond amounts over $50,000. Contact our Surety Bond Specialists for a free quote that fits your specific situation.

Did You Know?

Effective 1/1/2018, applications and surety bonds must be submitted through the NMLS online license system. All non-electronic applications must be converted no later than December 31, 2018.

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