                                 CODE OF VIRGINIA

(EFFECTIVE JULY 1, 2026) RELATIONSHIP BETWEEN LICENSEE AND AUTHORIZED DELEGATE;
PROHIBITED ACTIVITIES (§ 6.2-1944)

A. As used in this section, &#8220;remit&#8221; means (i) to make direct
payments of money to a licensee or its representative authorized to receive
money or (ii) to deposit money in a bank account specified by the licensee.

B. Before a licensee conducts business through an authorized delegate or allows
a person to act as the licensee&#8217;s authorized delegate, the licensee shall:

   1. Adopt, and update as necessary, written policies and procedures reasonably
   designed to ensure that the licensee&#8217;s authorized delegates comply with
   applicable state and federal law;

   2. Enter into a written contract that complies with subsection D; and

   3. Conduct a reasonable risk-based background investigation sufficient for the
   licensee to determine whether the authorized delegate has complied and will
   likely comply with applicable state and federal law.

C. The licensee&#8217;s authorized delegates shall operate in full compliance
with applicable state and federal law, and the licensee shall be responsible for
implementing and maintaining a reasonable risk-based supervision program to
monitor its authorized delegates.

D. The written contract required by subsection B shall be signed by the licensee
and the authorized delegate and, at a minimum, shall:

   1. Designate the person signing the contract as the licensee&#8217;s
   authorized delegate with the authority to conduct money transmission on behalf
   of the licensee;

   2. Set forth the nature and scope of the relationship between the licensee and
   the authorized delegate and the respective rights and responsibilities of the
   parties;

   3. Require the authorized delegate to fully comply with all applicable state
   and federal laws and regulations;

   4. Require the authorized delegate to remit and handle money in accordance
   with the terms of the contract between the licensee and the authorized
   delegate;

   5. Impose a trust on money and monetary value net of fees received for money
   transmission for the benefit of the licensee;

   6. Require the authorized delegate to prepare and maintain records as required
   by this chapter or regulations implementing this chapter, or as reasonably
   required by the Commission;

   7. Acknowledge that the authorized delegate consents to examination or
   investigation by the Commission;

   8. State that the licensee is subject to regulation by the Commission and
   that, as part of that regulation, the Commission may require the licensee to
   revoke an authorized delegate designation; and

   9. Acknowledge receipt of the written policies and procedures required under
   subdivision B 1.

E. If the licensee&#8217;s license is suspended, revoked, surrendered, or
expired, the licensee shall, within five business days, provide documentation to
the Commission that the licensee has notified all authorized delegates of the
licensee whose names are in a record filed with the Commission of the
suspension, revocation, surrender, or expiration of its license. Upon
suspension, revocation, surrender, or expiration of the license, all authorized
delegates shall immediately cease to provide money transmission on behalf of the
licensee.

F. An authorized delegate of a licensee shall hold in trust for the benefit of
the licensee all money net of fees received from money transmission. If any
authorized delegate commingles any funds received from money transmission with
any other funds or property owned or controlled by the authorized delegate, all
commingled funds and other property shall be considered held in trust in favor
of the licensee in an amount equal to the amount of money net of fees received
from money transmission.

G. An authorized delegate shall not use a subdelegate or otherwise designate or
appoint another person to conduct money transmission on behalf of a licensee.

H. No person shall engage in the business of money transmission on behalf of a
person not licensed under this chapter or exempt pursuant to &#xA7; 6.2-1923. A
person that engages in such activity provides money transmission to the same
extent as a person required to be licensed under this chapter and shall be
jointly and severally liable with the unlicensed and nonexempt person.

HISTORY: 2025, c. 214.