By the Division of Banks


COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

COMMISSIONER OF BANKS
FOREIGN TRANSMITTAL
AGENCY LICENSING
Docket No. 2013-019

TEMPORARY ORDER TO CEASE
AND DESIST

In the Matter of
GLOBAL MONEY REMITTANCE, INC.
Miami, Florida

Foreign Transmittal Agency License No(s):
FT4478 et al.


The Commissioner of Banks (Commissioner) having determined that GLOBAL MONEY REMITTANCE, INC., (Global Money or the Corporation) located at 25 SE 2nd Avenue, Suite 516, Miami, Florida has engaged, or is engaged in, or is about to engage in, acts or practices constituting violations of Massachusetts General Laws chapters 169 and applicable regulations found at 209 CMR 44.00 et seq., hereby issues the following TEMPORARY ORDER TO CEASE AND DESIST (Temporary Order) pursuant to General Laws chapter 169, section 13(b).

FINDINGS OF FACT

  1. The Division of Banks (Division), through the Commissioner, has jurisdiction over the licensing and regulation of persons and entities engaged in the foreign transmittal business in Massachusetts pursuant to Massachusetts General Laws chapter 169, and applicable regulations found at 209 CMR 44.00 et seq., which are administered by the Commissioner.
  2. Global Money is, and at all relevant times has been, a foreign corporation conducting business in the Commonwealth of Massachusetts. Global Money’s main office is located at 25 SE 2nd Avenue, Suite 516, Miami, Florida.
  3. According to the Division’s records, Global Money is a wholly owned subsidiary of InterTransfers, Inc., (InterTransfers).
  4. Global Money is licensed by the Commissioner as a foreign transmittal agency under Massachusetts General Laws chapter 169. According to records maintained on file with the Division, the Commissioner initially issued a foreign transmittal license to Global Money on or about April 10, 2006 with license number FT4478. License number FT4478 authorized Global Money to operate as a foreign transmittal agency at 25 SE 2nd Avenue, Miami, Florida.
  5. Global Money maintains a total of twenty-six (26) additional foreign transmittal agency licenses for 26 agents, for locations operated in the Commonwealth from which the Corporation conducts its foreign transmittal business.
  6. Global Money transmits money received from Massachusetts consumers primarily to Brazil. According to information reflected on the Corporation’s 2012 Annual Report filed with the Division, Global Money transmitted $34,975,176 for calendar year 2012.
  7. Global Money is a money service business as defined by The Bank Secrecy Act ("BSA") and its implementing regulation at 31 C.F.R. Chapter X.

    A. Failure to Transmit Funds

  8. Massachusetts General Laws chapter 169, section 8 states, in part:

    All money received for transmission to a foreign country by any licensee shall be forwarded to the person to whom the same is directed within seven days following receipt thereof…

  9. The Division’s regulation 209 CMR 44.10(5) states:

    Grounds for license revocation under M.G.L. c. 169, § 12 and the issuance of cease and desist orders under M.G.L. c. 169, § 13 shall include, but are not limited to, the following prohibited acts and practices by Licensees:

    (5) failing to forward all money received for transmission to a foreign country to the person to whom the same is directed within seven days following receipt thereof.

  10. On or about April 4, 2013, and continuing through the date of this Temporary Order, the Division received information indicating that InterTransfers, the parent company of Global Money, failed to transmit funds received by the Corporation on behalf of one hundred and two (102) Massachusetts consumers to multiple beneficiaries in foreign countries within seven days following the receipt thereof.
  11. According to information reviewed by the Division, beginning March 18, 2013 and continuing through the date of this Temporary Order, InterTransfers failed to transmit funds totaling approximately $231,531.60 on behalf of numerous Massachusetts consumers to beneficiaries located in foreign countries.

    A. Failure To Demonstrate the Financial Responsibility, Character, Reputation Integrity, and General Fitness to Maintain a License

  12. Massachusetts General Laws chapter 169, section 12 relevant to the licensing of foreign transmittal agencies states:

    The commissioner may suspend or revoke any license issued pursuant to this chapter if he finds that: (a) the licensee has violated any provision of this chapter or any rule or regulation adopted hereunder or any other law applicable to the conduct of such business; or (b) any fact or condition exists which, if it had existed at the time of the original application for such license, would have warranted the commissioner to refuse to issue such license.

  13. The Division’s regulation at 209 CMR 44.04(2) states in part:

    (a) The Commissioner may deny an application to engage in the business of foreign transmittal agency, if the Commissioner upon review of the application and other relevant information, determines that the Applicant has not satisfied the requirements of M.G.L. c. 169 or 209 CMR 44.03.

    (b) The Commissioner may also deny such an application if the Applicant has:

    1. violated any provision of M.G.L. c. 169 or 209 CMR 44.00;

    2. violated or engaged in a pattern of violations of any state or federal law applicable to the conduct of the business of a foreign transmittal agency and any rule, regulation or administrative order or directive promulgated thereunder;

    3. conducted, or will conduct, its business in an unsafe and unsound manner…

  14. On April 9, 2013, representatives of the Division contacted Erik Rodriquez, Compliance Officer at Global Money to discuss the information in Paragraphs 8 to 11 of this Temporary Order.
  15. During the April 9, 2013, teleconference, Global Money’s representatives notified the Division that InterTransfers was aware of the failure to remit funds and that both InterTransfers and its wholly owned subsidiary Global Money were facing financial difficulties.
  16. During the April 9, 2013 teleconference, representatives of Global Money and InterTransfers notified the Division’s representatives that InterTransfers would only be refunding any outstanding consumer funds that had been collected upon a formal request by the affected consumer and furthermore that all pending transmittals would likely be transmitted within three days.
  17. InterTransfer’s representatives were unable to assure the Division’s representatives that the Corporation had the financial capacity to transmit the consumer funds previously collected for transmittal.
  18. Based upon information and belief as of the date of this Temporary Order, InterTransfers has failed to forward Massachusetts consumers funds received for transmittal as referenced in Paragraphs 8 through 11 of this Temporary Order to the designated beneficiaries. It is unknown how many Massachusetts consumers have been affected by InterTransfers’ failure to transmit such funds, or if the practice is continuing to date.
  19. On the effective date of this Temporary Order, pursuant to Massachusetts General Laws chapter 169, section 13(b), the Division issued a Temporary Order to Cease and Desist (Order) against InterTransfers, Docket number 2013-018, based upon the information referenced in Paragraphs 8 through 18 of this Temporary Order. The Order issued by the Division alleged significant failures to comply with applicable state and federal laws, rules, regulations, and regulatory guidelines governing the conduct of InterTransfers and is incorporated herein by reference.

    CONCLUSIONS OF LAW

  20. Based on the information contained in Paragraphs 1 through 19, Global Money has failed to demonstrate the financial responsibility, character, reputation, integrity, and general fitness that would warrant the belief that the business will operated honestly, fairly, and soundly in the public interest in violation of Massachusetts General Laws chapter 169, section 6, the Division’s regulation 209 CMR 44.03, and the Division’s regulation 209 CMR 44.04.
  21. Based on the information contained in Paragraphs 1 through 19, Global Money’s parent company, InterTransfers, failed to remit funds received for transmission to a foreign country within seven days of receipt thereof in violation of M.G.L. chapter 169 section 8 and the Division’s regulation 209 CMR 44.10(5).
  22. Based upon the information contained in Paragraphs 1 through 19, had the facts and conditions found therein existed at the time of Global Money’s original foreign transmittal agency license application for license number FT4478, the Commissioner would have been warranted in refusing to issue such license.
  23. Based upon the information contained in Paragraphs 1 through 19, the public interest will be harmed by delay in issuing an Order to Cease and Desist under General Laws chapter 169, section 13(b) because, upon information and belief, InterTransfers, the parent company of Global Money has failed to remit funds collected from multiple Massachusetts consumers.  As of the date of this Temporary Order, InterTransfers as the parent company of Global Money has failed to demonstrate that those funds received for transmissions from several Massachusetts consumers were remitted within seven days or at all, and it is unknown if this is a continuing practice, that could possibly affect a growing number of Massachusetts consumers
  24. Based upon the information contained in Paragraphs 1 through 19, the Commissioner has determined that:
    1. Global Money has engaged, or is about to engage in, acts or practices which warrant the belief that the Corporation is not operating honestly, fairly, soundly and efficiently in the public interest in violation of standards governing the licensing and conduct of a foreign transmittal agency including, but not limited to, the provisions under General Laws chapter 169 and the Division’s regulations at 209 CMR 44.00 et seq.
    2. The public interest will be irreparably harmed by delay in issuing an ORDER TO CEASE AND DESIST against Global Money.

    ORDER TO CEASE AND DESIST

    After taking into consideration the FINDINGS OF FACT and CONCLUSIONS OF LAW stated herein, it is hereby:

  25. ORDERED that Global Money, any and all officers, directors, employees, independent contractors, or agents operating on behalf of Global Money, and their successors or assigns, shall immediately cease engaging directly or indirectly in the business of a foreign transmittal agency in Massachusetts, as defined in General Laws chapter 169, section 1, except as otherwise expressly permitted by the terms of this Temporary Order or by the Commissioner.
  26. IT IS FURTHER ORDERED that Global Money shall notify all independent contractors, or agents operating on behalf of Global Money to immediately cease engaging directly or indirectly in the business of a foreign transmittal agency on behalf of Global Money.
  27. IT IS FURTHER ORDERED that Global Money shall immediately secure all records, files, and documents (Records) relative to the Corporation’s foreign transmittal agency. Global Money is prohibited from destroying, altering, and/or modifying any of the referenced Records. The provisions of this Paragraph require Global Money to ensure that all agents operating on behalf of Global Money are directed to preserve all Records pursuant to the provisions of this Paragraph. The Records shall be available to the Commissioner in their entirety upon request.
  28. IT IS FURTHER ORDERED that Global Money shall immediately process and remit all transmittal orders for funds received from Massachusetts consumers with no loss to the consumer.  It being understood that "no loss to the consumer" shall mean that if the Corporation is unable to remit funds collected for transmittal, the consumer shall be entitled to a refund of all funds and any fees collected by Global Money. Global Money shall submit a detailed record to evidence compliance of this Paragraph in conjunction with the Report submitted to the Division as outlined in Paragraph 30 of this Temporary Order. Evidence of compliance shall include but not be limited to: receipts confirming the transmittal of funds; check numbers of payments issued by the Corporation to evidence reimbursements made to consumers, and the amount reimbursed to each individual.
  29. IT IS FURTHER ORDERED that within two (2) days of the effective date of this Temporary Order Global Money shall submit to the Commissioner:
    1. A detailed record, prepared as of the date of submission, of the Corporation’s accounting of the number and amount of Massachusetts transactions as of March 1, 2013 through the date of submission, of all transmittal orders for funds received from Massachusetts consumers. The report submitted to the Division shall include:
      1. Transactions that were processed, including those transactions that were paid out, cancelled, voided, and/or reissued through another licensed money transmitter or remain unresolved. If the transactions were processed through another money transmitter, the Corporation shall submit receipts of all transactions processed through the money transmitter.
      2. The Corporation’s record shall also include the names and addresses of all Massachusetts consumers from whom funds were collected for transmission. Additionally, the record shall include the dollar amount of all transmittal orders for funds received from Massachusetts consumers and a detailed list of any fees collected by the Corporation for the transmissions.
    2. A detailed record, prepared as of the date of submission, of an accounting of any monetary damages caused to any Massachusetts consumers or any intended recipient of monies or monetary value received for transmission as a result of Global Money’s failure to remit funds, including but not limited to, any late charges incurred or penalties imposed on accounts.
  30. IT IS FURTHER ORDERED that within five (5) days of the effective date of this Temporary Order, Global Money shall reimburse all fees collected by the Corporation for any transaction in which the Corporation received funds which were not transmitted within seven days following receipt thereof as required by Massachusetts General Laws chapter 169, section 8. Reimbursements shall be made to each person on a per transaction basis in an amount equal to the entire portion of the fee retained by the Corporation for such transaction. A record shall be provided to the Division of the names and addresses of all individuals whom the Corporation charged a fee, the total fees charged on each transaction, and check numbers of payments issued by the Corporation to evidence reimbursements made to consumers, and the amount reimbursed to each individual.
  31. IT IS FURTHER ORDERED that this Temporary Order shall become effective immediately and shall remain in effect unless set aside, limited or suspended by the Commissioner or upon court order after review pursuant to General Laws chapter 30A.
  32. IT IS FURTHER ORDERED that a hearing will be scheduled on this matter to determine whether or not such Temporary Order shall become permanent and final only upon receipt of a written request for such a hearing from the Global Money within twenty (20) days of the effective date of this Temporary Order. If no hearing is requested within this twenty (20) day period, this Temporary Order shall become permanent and final until it is modified or vacated by the Commissioner.
  33. BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS:

    Dated at Boston, Massachusetts, this 10th day of April, 2013

    By:
    David J. Cotney
    Commissioner of Banks
    Commonwealth of Massachusetts