USVI Public Records

As used in this title, unless it is otherwise provided or the context requires a different construction, application, or meaning- "Affiliate" means an corporation partnership, limited liability company business trust, or any other legal organization or entity that controls, is controlled by, or is under common control with another such entity. "Articles of incorporation" means the articles of incorporation of a corporation or other organizational documents necessary and appropriate in accordance with the structural laws under which an entity is organized. "Authorized to do business in the Territory" means that a financial institution is authorized to do the business of banking in the Virgin Islands, if it is: A. Organized under provisions of this title; B. Organized under provisions of prior laws of this Territory and subject to the provisions of this title; C. Organized under provisions of federal law and maintains this Territory as its home jurisdiction; D. Organized under provisions of federal law or laws of a State or any other possession of the United States, including the Commonwealth of Puerto Rico, and maintains a branch in this Territory; E. Organized under provisions of law of a foreign country and maintains a branch in this Territory in accordance with this title and applicable federal law. "Bank" means a domestic stock or mutual corporation or other legal entity with sufficient capital, authorized by law to receive deposits of money or securities, to open credits and accounts current and savings accounts, to make loans, to discount drafts, notes or other negotiable paper, to purchase and sell drafts, to trade in gold and silver, and in general to engage in the business of banking, closely related activities, and other services and activities as provided in this Title; but does not mean a national bank. "Banking Board" means the Banking Board of the United States Virgin Islands as established in the Office of the Lieutenant Governor. "Bank holding company" means a bank holding company as defined under the federal "Bank Holding Company Act of 1956", as amended. "Branch" means any office of a financial institution where the business of banking is conducted, other than the institution's main office. "Business of banking" means being in the business of taking deposits or making loans and of conducting, offering, or engaging in any activities, products or services as provided by title 9 Virgin Islands Code, chapter 11, section 121. "Capital" for a financial institution means the following: A. For financial institutions organized as corporations, "capital" means the sum of common stock paid-in common stock surplus, a perpetual preferred stock, undivided profits and other capital reserves B. For financial institutions organized as limited liability companies, limited partnerships or limited liability partnerships, or other entities, "capital" means the sum of members' or partners' contributions and undistributed earnings of the company, partnership or other entity; and C. For all financial institutions, "capital" means and includes all features as permitted by applicable federal law or, where such financial institution is not subject to federal law, as required by the FDIC whether or not such financial institution is subject to regulation by the FDIC. "Change in control" means any transaction by a bank or its holding company for which a notice is required to be filed with the FDIC or the Board of Governors of the Federal Reserve System pursuant to the federal Bank Holding Company Act or the Federal Deposit Insurance Act as a transaction for acquisition of control or other change in control as provided in such federal law, rule or regulation. "Control" means the power to vote directly or indirectly 25 percent or more of any class of the voting securities of a financial institution, the ability to control in any manner the election of a majority of a financial institution's directors or trustees, or the ability to exercise a controlling influence over the management and policies of a financial institution. "Corporation" means a corporation, limited liability company, limited partnership, business trust, or any other legal organization or entity. "Demand liabilities" means all such obligations as a bank or foreign bank is obliged to pay within a term not longer than three days. "Director" means the Director of the Division of Banking, Insurance and Financial Regulation, Office of the Lieutenant Governor. "Exempt international banking facility" means an exempt company, as defined in title 13, chapter 14, Virgin Islands Code, which is not a bank, but which is authorized to undertake certain limited banking activities pursuant to chapter 21 of this title. "FDIC" means the Federal Deposit Insurance Corporation or its successors. "Financial entity" means any bank, bank holding company, financial holding company, financial institution, financial institution holding company, foreign bank, foreign bank holding company, or affiliate or subsidiary of any and them, as defined in this chapter. "Financial holding company" means a financial holding company as provided by 12 U.S.C.1841(p) et seq., as amended [Gramm-Leach-Bliley Financial Services Modernization Act of 1999]. "Financial institution" means a bank, foreign bank, trust company, nondepository trust company, savings bank, industrial bank or savings and loan association organized under the laws of this Territory, any State, or the United States. "Financial institution holding company" means an company that has control over any financial institution or has control over any company that controls any financial institution. A financial institution holding company shall be deemed to own shares owned by a subsidiary, and to engage in activities engaged in by a subsidiary or any other company of which it owns 5% or more of the voting interests. "Foreign bank" means a corporation organized for the purpose of engaging in banking business under the laws of another territory or state, or of a foreign country, operating a bank at the place of its incorporation. "Foreign bank holding company" means any company that controls, directly or indirectly, a foreign bank. "Governing body," means the body that oversees the affairs of a financial institution. The governing body may also be referred to as the "board of directors," "board of trustees," "board of managers," "partners' committee" or "managing partners' committee," or other similar term, depending on the ownership structure. "Insurance producer" means any insurance agent or broker, surplus lines broker, insurance consultant, limited insurance representative, and any other person that solicits, negotiates, effects, procures, delivers, renews, continues or binds policies of insurance or offers advice, counsel, opinions or services related to insurance and is licensed to provide such services pursuant to title 22, Virgin Islands Code. "Interested party" means a person having a substantial interest in, or who is or may be aggrieved by, any act or impending act, or any report, rule, regulation, amendment, decision or order of the Director or Board. "Investor" means any person who has an ownership interest in a financial institution and is entitled to vote under the institution's organizational documents. "Legal reserve" means the sum which every bank and foreign bank shall at all times have available for the payment of their deposit liabilities pursuant to the provisions of this title. "National banking association" means a bank incorporated and organized under the National Bank Act (12 U.S.C. §21 et seq.), and laws amendatory thereof or supplementary thereto. "Not authorized to do business in this Territory" means any person engaged in the business of banking that does not satisfy the definition of "authorized to do business in this Territory". "Officer" means an employee of a financial institution who has been given managerial or other high-level duties by the governing body of the financial institution. Depending on the ownership structure of the institution, an officer may include a person with the title of chair, president, vice-president, manager, managing partner or partner. "Organizational document" means the charter, certificate of organization, articles of incorporation articles of association, articles of organization, certificate of limited liability partnership, bylaws, operating agreement, partnership agreement or any other similar document required to be filed with and approved by the Director or Banking Board or otherwise essential for the operation of the corporation. "Paid in capital, reserve and undistributed profits" means, in the case of a foreign bank, the aggregate paid in capital, reserve and undistributed profits of such bank and not merely that allocated to, located in or arising out of its operations in the United States Virgin Islands. "Real estate activities" means any real estate-related service to the extent and as authorized for any financial institution charted by or otherwise subject to the jurisdiction of the Government of the United States pursuant to federal law. "Reserve fund" means a fund formed or increased either by assessment on the stock holders or by transfer of net profits or of the undivided profits of the bank, and such fund shall not be used for payment of dividends or for the purpose of paying the expenses of the bank while there is any available balance in the undivided profits account. "Savings account" means a deposit account other than one from which funds may be withdrawn by use of checks or drafts. "Service corporation" means a corporation substantially all the activities of which consist of originating, purchasing, selling and servicing loans and participation interests therein; or clerical, bookkeeping, accounting and statistical or similar functions related to a financial institution or real estate activities; or management, personnel, marketing or investment counseling related to a financial institution or real estate activities; or establishing or operating one or more satellite facilities; or any activity authorized by the Director or Banking Board by rule or order that has been authorized under federal law for service corporations owned or controlled by national banks, federally chartered savings and loan associations, federally chartered savings banks or federally chartered credit unions. "Shareholder" means any person who has an ownership interest in a financial institution and is entitled to vote under the institution's organizational documents. "Share" and "stock" means shares of stock or other interests as may be appropriate for the structure of the particular entity involved, including but not limited to membership units or other units of measure that indicate a right to participate in profits and losses of the organizational entity of which they are part, including but not limited to corporations and limited liability companies. "Subsidiary" means a corporation, partnership, business trust association or similar organization, all of which are referred to in this subsection as "another company," owned or controlled by a financial institution or financial institution holding company. "Total capital" means the sum of capital, as defined in this Section, plus capital notes and debentures, other instruments approved by the Director or Banking Board, and the allowance for loan losses or other similar reserves. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Dec. 8, 1986, No. 5224, § 5(2), Sess. L. 1986, p. 362; Nov. 28, 1987, No. 5289, § 1, Sess. L. 1987, p. 150; Mar. 5, 2005, No. 6727, § 4(1), Sess. L. 2005, pp. 5-11; amended Jan. 20, 2017, No. 7962, § 8(1), Sess. L. 2016, p. 311.

This title is applicable to all banks organized before or after it takes effect, but does not apply to national banking associations. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

For a bank to engage in the banking business in the United States Virgin Islands, compliance with the requirements of this title shall first be necessary, and the engaging in such business without having complied therewith shall be punished as provided in this title. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The term "bank" in the designation of a business shall be used only by corporations doing a banking business exclusively international financial services entities or by an international banking entity. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Dec. 8, 1986, No. 5224, § 5(3), Sess. L. 1986, p. 362; amended Sept. 11, 2012, No. 7390, § 1(a)(1), (2), Sess. L. 2012, p. 194; amended Jan. 20, 2017, No. 7968, § 6, Sess. L. 2016, p. 394.

No bank or foreign bank shall be established under the same name as that already used by another institution, or so nearly similar thereto as to lead to confusion. When a bank ceases doing active business it may transfer or assign to another bank the right to use its name. No bank shall use the name of any bank which has ceased to do business, unless it previously incorporates under such name or changes its own in accordance with the provisions of section 38 of this title. If the assignment is made to a foreign banking corporation, the foreign banking corporation shall not use the same name without having first filed its certificate of incorporation and without having complied with the other provisions of this title. However, no bank shall use the name of any bank which has ceased to do business when the use of such name would be misleading or confusing. The fact of such transfer or change of name shall be published at least three times a week for a period of at least three consecutive weeks in a newspaper of general circulation in each judicial division of the United States Virgin Islands. No exempt international banking facility shall be established under the same name as that already used by another institution, or so nearly similar thereto as to lead to confusion; provided, that nothing in this section shall be construed to prevent a bank, foreign bank, or bank holding company from establishing an exempt international banking facility using a name similar to that of the establishing bank. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Dec. 8, 1986, No. 5224, § 5(4), Sess. L. 1986, p. 362.

Whoever, being an officer, director or employee of any bank authorized to do business in the United States Virgin Islands, discloses any information concerning a depositor or borrower or such person's account with such bank, or who discloses any confidential information concerning such bank, to a person not authorized by law to obtain such information shall be fined $500 or imprisoned not more than one year, or both; provided, however, that the provisions of this section do not prohibit the confidential exchange of necessary and pertinent information between banks, domestic and foreign, and between such banks and credit bureaus with respect to the credit of any person who has applied to any such bank for a loan. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 24, 1988, No. 5336, § 10, Sess. L. 1988, p. 125.

Domestic and foreign banks, as corporations or other legal entities, shall be subject to the applicable provisions of the law applicable to their legal structure only to the extent that such provisions of are compatible and do not conflict with the provisions of this title; and in the event of any conflict or incompatibility between this title and such other law with respect to any domestic or foreign bank the provisions of this title shall prevail. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(2), Sess. L. 2005, p. 11.

(1) Any legal form or structure including that of a corporation, partnership, limited liability company, or other entity, may be used to create an entity for licensure as a bank, in accordance with this title, provided that such entity meets all requirements for capitalization, accountability, and other similar features as required by applicable federal and territorial law or, where such bank is not subject to federal law, as required by the FDIC whether or not such bank is subject to regulation by the FDIC and that the organizational documents must address the powers and duties of its governing body. (2) Number of directors. The governing body of a bank must consist of at least 5 directors, except that the Director or Banking Board may approve fewer directors for good cause shown. (3) Executive committee. The governing body of a bank organized as a corporation may appoint by majority vote of the governing body an executive committee of no less than 5 members and may delegate to the committee the powers of the governing body in regard to the ordinary operations of the business of the institution. The Director or Banking Board may approve fewer members for good cause shown. (4) Frequency of meetings. A governing body of a bank organized as a corporation that has appointed an executive committee shall meet at least 6 times a year, including once each quarter, if the executive committee meets during the months in which the governing body does not meet. Minutes of executive committee meetings must be ratified by the governing body. The governing body of a bank organized as a corporation that has not appointed an executive committee or the governing body of any other bank shall meet at least monthly. The Director or Banking Board may approve less frequent meetings for good cause shown. (5) Audit committee. (a) The board of directors shall establish an audit committee consisting of at least three (3) board members. The audit committee, as a committee of board of directors, shall be directly responsible for the appointment, compensation, and oversight of the work of any registered public accounting firm employed for the purpose of preparing or issuing an audit report or related work (including resolution of disagreements between management and the auditor regarding financial reporting), and each such registered public accounting firm shall report directly to the audit committee. (b) Independence. (1) Each member of the audit committee shall be a member of the board of directors, and shall otherwise be independent. (2) In order to be considered independent for purpose of this section, a member of an audit committee may not, other than in his capacity as a member of the audit committee, the board of directors, or any other board committee- A. accept any consulting fee from the bank, bank holding company or any affiliate or subsidiary; B. be an affiliated person of the bank, bank holding company or any affiliate or subsidiary; C. own more than five percent (5%) of the bank or bank holding company stock; D. be related by blood, marriage, or common financial interest to an officer, director, or shareholder owning more than five percent (5%) of the bank or bank holding company stock; or E. be significantly indebted to the bank. (c) Complaints. Each audit committee shall establish procedures for the following: (1) the receipt, retention, and treatment of complaints received by the bank regarding accounting, internal accounting controls, or auditing matters; and (2) the confidential, anonymous submission by employees of the bank of concerns regarding questionable accounting or auditing matters. (d) Authority to engage advisers. Each audit committee shall have the authority to engage independent counsel and other advisers, as it determines necessary to carry out its duties. (e) Funding. Each bank shall provide for appropriate funding, as determined by the audit committee, in its capacity as a committee of the board of directors, for payment of compensation: (1) to the registered public accounting firm employed by the issuer for the purpose of rendering or issuing an audit report; and (2) to any advisers employed by the audit committee under paragraph (d). History: Added Mar. 5, 2005, No. 6727, § 4(3), Sess. L. 2005, p. 11.

(a) Any five or more persons of sufficient legal capacity may organize a bank; but for said purpose they shall first apply for a permit from the Banking Board, and such application shall be accompanied by a fee as promulgated by the Banking Board. Said application shall set forth and prove the need of the services of a banking institution in the locality wherein the bank is sought to be established, and that the services rendered by other banking institutions do not answer the needs of said locality. (b) It shall be the duty of the Banking Board, immediately after it receives an application for a permit, to make whatever investigations and hold such hearings as the Banking Board deems may be necessary as to: (1) the banking and commercial ability and experience of the applicants; (2) whether such ability and experience are sufficient to warrant the efficient functioning and operation of the bank; (3) whether local need justifies the application; (4) character and repute, as well as the banking and commercial experience of the prospective directors or officers who are to conduct the business of said bank; (5) whether the bank shall be of benefit to the general public; and (6) the capital which the bank has available for its operations. (c) The Banking Board shall issue the permit applied for if, in its judgment, the result of the investigations are satisfactory; provided, that the decision of the Banking Board shall be final, except that any person aggrieved by the action of the Board under the provisions of this subsection shall be entitled to judicial review thereof by filing a petition for a writ of review with the Superior Court within thirty days of such final decision; and provided, further, that all expenses incurred by the Banking Board in connection with such investigations shall be paid by the applicants in conformity with the regulations the Banking Board may make and promulgate for the purpose. After the permit is granted, the applicants shall execute before a notary, and file in duplicate, articles of incorporation or other organizational document necessary and appropriate in accordance with the structural laws under which the bank is to be organized, in accordance with the provisions of this section. (d) The articles of incorporation must be subscribed by each of the incorporators and duly sworn to before a notary public. They shall specifically state: (1) The name by which such bank is to be known; (2) The city or town of the United States Virgin Islands, and the street and number where its main office is to be established, which shall be its legal domicile; (3) The amount of the authorized capital stock, the number of shares into which the same is divided, the par value of each share, and when said shares are to be issued in series, the date of issue of each series, as well as the manner and term in which payment for such shares must be made; (4) The term of duration of the bank; (5) The transactions to which the capital of the bank is to be preferably devoted; (6) The time and manner of calling and holding regular meetings of stockholders, and the reasons and circumstances for, and manner of, calling and holding special meetings; (7) The manner of constituting a quorum at the regular and special meetings of stockholders, provided the same is not in conflict with the provisions of this chapter; (8) The names and places of residence of the incorporators or other organizers and the number of shares subscribed by each; (9) The number of directors of the bank, which shall not be less than five, and not less than one-third of the total number of whom shall be bona fide residents of the United States Virgin Islands, the manner of their election, their terms of office, and the number necessary to constitute a quorum; and (10) Any other articles which the incorporators may deem it advisable to insert for the regulation of the business and the conduct of the affairs of the bank, provided that such articles shall not be in conflict with this title, or with any other laws of the United States Virgin Islands. (e) Any applicant that has received approval to conduct business as a financial institution may not commence business until the Chairman of the Banking Board certifies in writing that the required capital has actually been paid in and that all other required terms and conditions have been satisfied. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, §§ 4(4)-(7), Sess. L. 2005, pp. 13, 14.

Upon subscribing and swearing to the articles of incorporation, as provided in section 31 of this title, and upon submitting the two copies of the same to the Lieutenant Governor, together with the permit granted by the Banking Board authorizing the organization of the bank, and payment of the proper filing fee, and upon the issuance by the Lieutenant Governor, under his seal, of a certificate stating that the said articles containing the statements required by section 31 of this title have been filed in his office, the existence of the bank named in the said articles of incorporation shall begin. From and after the date of such filing said bank shall constitute a body corporate under the name set forth in the said articles, subject however, to dissolution as provided in this title. Before such bank may commence business it shall comply with the other requirements of this title, and all other applicable provisions of law. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Before a bank shall begin to do business, the stockholders thereof shall hold a general meeting and adopt bylaws governing the corporation. A number of stockholders representing more than two-thirds of the paid- in capital shall be present at such meeting, and in order that any action taken shall be valid, the same must be approved by the affirmative vote of a majority of the stock present at said meeting. The bylaws of a bank may be amended in the manner provided for their approval. A meeting held to amend the articles of incorporation and bylaws shall be called at least ten days in advance, and the time and place of such meeting as well as the part which it is proposed to amend shall be stated in the call, but notice of said meeting may be waived by the written unanimous consent of the stockholders. This section shall apply only to banks organized under the laws of the United States Virgin Islands. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Notice to Banking Board of certificate of incorporation (a) Upon the issuing by the Lieutenant Governor of his certificate of incorporation, as provided in section 32 of this title, he shall so notify the Banking Board and at the same time shall transmit to the Board a duplicate copy of the articles of incorporation. Examination of bank's condition (b) When the duplicate copy is received by the Banking Board, the Board shall notify the corporation, and the corporation shall then file with the Board a statement of all the facts necessary to enable the Board to determine whether the bank has in fact complied with all the requirements of law and is lawfully entitled to commence business, such statement to be sworn to by a majority of the directors and by the president or the manager of the bank. Upon receipt of such statement by the Board, the Board shall examine the condition of the corporation, ascertain specifically the amount of its capital paid in, the names and places of residence of its directors and officers, and the amount of the capital stock which each owns in good faith, and, generally, whether such corporation has complied with all the provisions of law, including this chapter, required to entitle it to a license to engage in the business of banking. Certificate of authority to commence business (c) If, upon a careful examination of the facts so reported, or of any other relevant facts which may come to the knowledge of the Banking Board, the Board is satisfied that the minimum amount of its subscribed capital stock required by section 35 of this title to be paid in has in fact been duly paid in; that the deposit insurance and other insurance coverage required by subsection (b) of section 61 of this title is provided; that a resident agent, authorized to accept service of process under the provisions of section 44 of this title, has been appointed and that the Lieutenant Governor has received the required notice of such appointment; and that such bank has complied with all the applicable provisions of this title and other law required to be complied with before a bank shall be authorized to commence the business of banking, the Banking Board shall direct the Lieutenant Governor to give to such bank a certificate, under his hand and official seal, stating that such bank has complied with all the requirements of law, and that such bank is authorized to commence such business immediately upon the issuance of a license thereto in accord with the provisions of section 43 of this title. But the board may withhold from a bank the certificate authorizing it to commence business, whenever it is satisfied that the shareholders have organized said bank for any other than the legitimate objects determined by this chapter. The expenses incurred by the Banking Board in connection with such investigations shall be paid by the corporation in conformity with the regulations the Banking Board may make and promulgate for the purpose. Publication of certificate (d) The president or the manager of the bank shall cause the certificate issued under subsection (c) of this section to be published once a week during a period of sixty days in a newspaper of general circulation in each judicial division of the United States Virgin Islands. Articles of incorporation as evidence (e) The articles of incorporation filed in accordance with this title, or a copy thereof duly certified by the Lieutenant Governor, shall be prima facie evidence of the facts therein contained. Duration of certificate (f) The certificate issued under subsection (c) of this section shall remain in effect for one year from the date of issuance unless further extended by the Banking Board after a request stating the reasons for such extension is submitted to and approved by the Board. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Rights and liabilities of stockholders and creditors (a) No bank shall be organized and established in the United States Virgin Islands with a subscribed capital less than $500,000. The capital stock of each bank shall be divided into shares of $100 each, or into such shares of lesser amount as may be provided in the articles of incorporation, and shall be transferable on the books of the bank in such manner as may be prescribed in its bylaws or articles of incorporation. Every person becoming a shareholder by such transfer shall, in proportion to his shares, succeed to all rights and liabilities of the prior holder of such shares; and no change shall be made in the articles of incorporation by which the rights or security of the existing creditors of the bank shall be impaired. Amount of stock to be paid in (b) At least 50 per centum, but in no case less than $500,000, of its subscribed capital stock shall be paid in before it shall be authorized to commence business; and the remainder shall be paid in monthly installments of at least 10 per centum each, on the whole amount of the subscribed capital stock from the time the bank is authorized by the Banking Board to commence business. The payment of each installment shall be certified to the Banking Board, under oath, by the president or the manager of the bank. Delinquent stockholders (c) Any shareholder or assignee thereof who fails to pay any installment as required by subsection (b) of this section, shall be deemed to be a delinquent shareholder, and the directors of the bank may sell the share or shares of such delinquent stockholders at a public auction after announcing the sale in a newspaper of general circulation in each judicial division of the United States Virgin Islands. The stock so sold shall be awarded to the person paying the highest price therefor, such price not to be less than the amount due on the stock plus the expense of announcement and sale. The excess, if any, shall be paid to delinquent stockholder. If there is no bidder who will pay for such stock the amount due thereon to the bank and the cost of advertisement and sale, the amount previously paid shall be forfeited to the bank, and such stock shall be sold as the directors may order, within six months from the time of such forfeiture, and if not sold it shall be canceled and deducted from the capital stock of the bank. If any such cancellation and reduction shall reduce the capital of the bank below the minimum of the capital required by law, the capital stock shall, within thirty days from the date of such cancellation, be increased to the required amount, in default of which a receiver shall be appointed according to the provisions of this title to liquidate the business of the bank. Deficiency in stock; receivership (d) Every bank established after June 16, 1949, which fails to have its capital stock paid in as required by this section shall, within three months after receiving notice thereof from the Banking Board cover the deficiency in its capital stock by pro rata assessment on the shareholders, or by means of new shareholders. If any bank fails to have its capital stock paid in and refuses to go into liquidation as provided by this title, after receiving notice from the Banking Board, a receiver shall be appointed to liquidate the business of the bank according to the provisions of this title. No bank shall make a new issue of stock until all stock previously issued shall have been paid in. Payment of stock (e) If the interest of a bank requires a prompt payment of its shares, the Board of Directors may resolve to call for such immediate payment of an assessment on the stock as may be necessary, and shall report the fact to the stockholders at their next general meeting, whether regular or special. Dividends, distributions and withdrawals (f) (1) Limitation. A financial institution organized pursuant to this chapter may not authorize dividends, distributions or withdrawals that reduce capital below the amount required by this title. (2) Form. Dividends, distributions and withdrawals must be in cash or in additional shares, members' interests or partnership interests unless otherwise authorized by the Director or Banking Board. Cash reserves (g) (1) A financial institution organized under the laws of this Territory shall maintain reserves on deposits or accounts as required from time to time by the Federal Reserve Act, Section 12 U.S.C.247, as amendedSection 12 U.S.C.12 promulgated under it. (2) Transition period. Reserves held by a financial institution to meet the requirements of this section must be in the form prescribed by the Federal Reserve Act, SeFederal12 U.S.C.248t aSection 12 U.S.C.12egulations promulgated under it. (3) Assessment for deficiency. Any deficiency in the cash reserve established pursuant to this section may be subject to an assessment for such period of time as the deficiency may exceed 2% of the required reserves. Any such penalty may be assessed at a rate not to exceed 10% per year. (4) Failure to make up deficiency. If any financial institution fails to make up a reserve deficiency with a corresponding excess reserve in the reserve computation period immediately following the period in which the deficiency occurred, the Banking Board may declare that no loans or investments be made except those loans secured by deposit accounts or investments made in bonds or other obligations issued by the United States or any of its instrumentalities. (5) Reports. The Banking Board may require any financial institution to furnish such reports as it deems appropriate to properly supervise compliance with the requirements of this section. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Sept. 4, 1973, No. 3474, Sess. L. 1973, p. 241; Mar. 5, 2005, No. 6727, § 4(8), Sess. L. 2005, p. 14.

If any shareholder neglects or refuses, after three months' notice, to pay the assessment provided in subsection (d) or (e) of section 35 of this title, the Board of Directors shall cause a sufficient amount of the capital stock of such shareholder to be sold at public auction (upon thirty days' notice to be given by posting such notice of sale in the office of the bank or by publication in a newspaper of general circulation in each judicial division of the United States Virgin Islands), to make good the deficiency; and the balance, if any, shall be returned to such delinquent shareholder. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

All shares shall be recorded in a book which shall be kept for that purpose by each bank at its main office, in which book entry shall also be made of all subsequent transfers of said shares. Each certificate of stock shall contain a statement showing the par value of each share, and the amount paid thereon. This section shall not apply to foreign banks. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) Every bank organized under this title may amend its articles of incorporation by- (1) changing its name, subject to the provisions of section 5 of this title; (2) increasing or decreasing its authorized capital stock, subject to the minimum limit allowed by law; (3) changing the par value and number of shares of its capital stock; (4) changing the location of its main office; (5) extending the term of its corporate existence as limited in the articles of incorporation; and (6) making such other changes as may be required. (b) No amendment may contain a provision which it would not have been lawful and proper to insert in the original articles of incorporation. (c) Such amendments shall be adopted by two-thirds of the entire capital stock of the bank at a general meeting of stockholders duly called by the Board of Directors, either on their own initiative or on petition of stockholders representing 20 percent of the capital stock. Such action as may be taken shall be set forth in a certificate issued in duplicate and signed by the president or other duly authorized officer of the bank, under the corporate seal, and sworn to before a notary public. The certificate, in duplicate, together with the written assent given in person or by proxy of stockholders representing two-thirds of the total number of shares issued, shall be forwarded to the Lieutenant Governor, who shall thereupon notify the Banking Board and at the same time shall transmit to it the duplicate of the certificate. Upon approval by the Banking Board of such amendment and payment of the proper fees, the articles of incorporation shall be deemed amended accordingly, and the Banking Board shall direct the Lieutenant Governor to issue to the bank a certificate under his seal to that effect. (d) The Board of Directors of any bank organized under the provisions of this title may remove its branches from one place to another within the Virgin Islands by resolution duly adopted by the Board of Directors; but no removal, either of the main office or of any branch, shall be made until a copy of said resolution, duly signed by the president and the secretary and under the corporate seal, shall have been filed and any fee required by law shall have been paid, nor shall any change of name be valid until it is approved by the Lieutenant Governor, and no change in the capital stock of any bank or other interests in the bank as appropriate to its organizational structure shall be made until the details of the proposed transaction have been reported to and approved by the Banking Board. (e) All debts, liabilities, privileges and powers of a bank under its old name shall devolve upon and inure to the bank under a new name. Nothing contained in this section shall be so construed as in any manner to release any bank under its old name, or at its old domicile, from any liability, or as to affect any action or proceeding in law in which said bank is or may become a party in interest. (f) Officers and employees. (i) Officers. Except as provided in this section the powers and duties of officers of a bank organized under this chapter are governed by the provisions of law generally applicable to the type of organization which it is, as appropriate, depending upon the organizational form used. The bank's organizational documents must address the powers and duties of officers. (ii) Appointment. The governing body of a bank shall appoint from its members or otherwise one or more officers to manage the day-to-day affairs of the bank holding company or subsidiary. One of these officers must be designated the chief executive officer. The governing body shall report the name of the designated chief executive officer to the Banking Board within 10 days of designation. (iii) Bonds. The governing body of a bank shall require security for the fidelity and faithful performance of duties by its officers, employees and agents in an amount that the governing body considers necessary or that the Banking Board requires. This security must consist of a bond executed by one or more surety companies authorized to transact business in this Territory. The Banking Board may increase this amount from time to time as circumstances may require. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, §§ 4(9), (10), Sess. L. 2005, p. 15.

(a) The management of banks shall be under the control of a Board of Directors elected at a general meeting of the stockholders. The Board of Directors shall consist of at least five persons, one-third of the total number of whom shall be bona fide residents of the United States Virgin Islands, who shall hold office for a term of not less than one year and until their successors have been elected and have qualified. Any member of the Board of Directors may be reelected. One of the directors shall be elected president, either by the other directors or at a general meeting of the stockholders, as may be determined by the bylaws, and shall hold office until his term as director has expired and until his successor has been elected and qualified. One or more vice-presidents, who need not be directors, shall be elected in the same manner, and subject to the same conditions as to term of office. (b) All meetings of the Board of Directors shall be held at one of the offices of the bank in the United States Virgin Islands, and no meeting shall be lawfully organized unless there are present the president or a person legally performing his duties in accordance with the articles of incorporation, and a majority of the total number of directors. At the regular meeting of the stockholders at which the Board of Directors is elected, substitute directors may also be elected in a number equal to one-half the number of regular directors. Such substitute directors shall serve in and during the absence of the regular directors and in all cases shall have the same qualifications and be subject to the same liabilities as the regular directors. (c) At least one-third of the total number of directors shall be bona fide residents of the United States Virgin Islands, and all shall be at least 21 years of age, and shall hold shares of the bank, subscribed in their name, of a par value of not less than $1,000 which shares shall be deposited in the bank while the said directors discharge their offices. Each director and each substitute director prior to assuming the duties of his office shall take an oath that he will faithfully discharge the duties thereof, and shall comply and enforce compliance with all the provisions of this title and other laws applicable in the case, that he is the owner in good faith and in his own right of the amount of the bank's stock required for his qualification for office, which stock shall remain on deposit in the custody of the bank until all his acts as such director shall have been approved by the stockholders at a general meeting. Such oath shall be immediately transmitted to, and be filed in, the office of the Banking Board. (d) The Board of Directors shall pass upon all matters relative to the management of the bank; upon such matters as may be referred to them by a general meeting of the stockholders; and upon such business propositions as may be made to them. They may entrust the executive officers of the bank with the decision of its current affairs. (e) The directors of a bank, as long as they observe the rules of the mandate vested in them by law, shall be exempt from personal liability, either separately or jointly, for their acts as directors of the corporation. If losses are incurred through willful violation of the laws or bylaws of the bank, or through willful infraction of any lawful resolution adopted at its general meetings, the directors responsible for such violation or infraction shall be jointly and severally liable for the full amount of such losses, and the shares deposited as required by subsection (c) of this section shall, if necessary, be applied against such amount. (f) Every bank shall hold at least one regular general meeting of stockholders each year, and such other special meetings as may be necessary or as may be requested by petition of stockholders representing 20 percent of the capital paid in. The time of the year, as well as the form and manner of holding regular general meetings or special meetings of stockholders, shall be provided in the bylaws; and a quorum shall consist of stockholders representing more than one-half of the capital paid in. (g) Minutes shall be kept of each meeting of the Board of Directors, which shall be open to the inspection of the Banking Board and to bank examiners acting under authority of law, and such minutes shall not be abridged or destroyed without prior approval of the Banking Board. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Banks established and doing business in the United States Virgin Islands prior to June 16, 1949, are not required to meet the provisions of incorporation in this title and the operating capital of the bank as of June 16, 1949, is deemed to have met the requirements of this title with respect to subscribed capital. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) No sale or exchange or acquisition of the voting capital stock issued by any bank or bank holding company organized under the provisions of this title that may result in the control or in a change in the control of a bank shall be made until the Banking Board has been notified of the details of the proposed operation by the president or other authorized executive officer of the bank, and the Banking Board's approval has been obtained. (b) The notice to the Banking Board shall contain information as to the number of shares of stock or other interests which are the subject of the operation, the name and address of the vendor (or assignor) and of the vendee (or assignee), the purchase price, the total number of shares or other interests owned by the vendor (or assignor) and by the vendee (or assignee), respectively, before making the proposed sale, exchange or acquisition. (c) It shall be the duty of the Banking Board, as soon as it receives notice of a proposed transaction that may result in the control or in a change in the control of a bank, to make the necessary investigations with respect: (1) to the character, experience and financing responsibility of the vendee (or assignee), (2) if such character, experience and financing responsibility guarantee the efficient operation of the bank, and (3) if the transfer of the control of the bank jeopardizes the interests of the depositors, creditors or stockholders of the bank. (d) The Banking Board shall issue authorization for the transfer of control of a bank if the result of its investigation is, in its judgment, satisfactory. The resolution of the Banking Board shall be final. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(11), Sess. L. 2005, p. 16.

(a) Every bank or foreign bank in the United States Virgin Islands shall upon filing its articles of incorporation in the Office of the Lieutenant Governor pay a filing fee of $300. (b) Every bank or foreign bank desiring to file in the Office of the Lieutenant Governor articles amendatory or supplementary or certificates of increase or decrease of capital stock shall pay a fee of $50. (c) Every foreign bank filing in the Office of the Lieutenant Governor a certificate of the appointment of an agent residing in the United States Virgin Islands or a certificate of the revocation of such appointment of the resident agent, shall pay a fee of $25. (d) The fee for furnishing a certified copy of any of the documents referred to in the preceding subsections of this section shall be two dollars per folio, but not less than $25. (e) All fees required under the provisions of this section shall be paid to the Office of the Lieutenant Governor and shall be accounted for and covered into the Treasury of the United States Virgin Islands. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, §§ 4(13)(i)-(iii), Sess. L. 2005, p. 17.

Penalties (a) The Lieutenant Governor, upon recommendation of the Banking Board, shall issue licenses to engage in the business of banking. No person or other entity may engage in the business of banking in the Territory without first obtaining a permit and otherwise complying with the provisions of this chapter. (b) Every bank, national banking association, or foreign bank, or other person or entity engaged in the business of banking in the United States Virgin Islands shall obtain, on or before the 30th day of June of each calendar year, a special license to do business in the United States Virgin Islands during the succeeding calendar year, upon payment of the corresponding fees, as promulgated by the Banking Board. (c) The Lieutenant Governor, upon recommendations of the Banking Board, shall grant a grace period of not exceeding thirty days during which an existing license may be continued in effect after the 31st day of December, to any bank or foreign bank which shows good cause therefor to the Banking Board, when the Banking Board considers such action to be in the public interest. (d) Every bank or foreign bank which, without having a valid license currently in effect, transacts any banking business, shall, upon conviction, be fined not more than $2,500 for each such transaction; and every director, officer or employee of any bank or foreign bank who participates in any banking transaction knowing that the bank or foreign bank of which he is a director, officer or employee does not have a currently valid license shall be guilty of a felony and, upon conviction, shall be subject to the penalty provided in section 3 of Title 14, and each such transaction in which such director, officer or employee so knowingly participates shall constitute a separate offense. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Nov. 7, 1983, No. 4877, § 310(d)(1), (2), Sess. L. 1983, p. 240; May 14, 1985, No. 5060, § 309(a), Sess. L. 1985, p. 48; Mar. 13, 1990, No. 5507, § 1, Sess. L. 1990, p. 22; July 14, 2003, No. 6585, § 1, Sess. L. 2003, p. 26; Mar. 5, 2005, No. 6727, § 4(12), Sess. L. 2005, p. 17.

Every bank shall appoint a bona fide resident of the United States Virgin Islands as its resident agent on whom service of legal process against it can be made, and service upon such resident agent shall constitute service on the bank by whom such resident agent was appointed. Each bank shall at all times keep the Lieutenant Governor informed, by letter signed by its duly authorized officer with the corporate seal of the bank affixed, of the name and address of its current resident agent. If any bank fails to appoint a resident agent for service of process, or if such agent dies, becomes incompetent, or cannot by the exercise of due diligence be found within the United States Virgin Islands, and, in any case, after its dissolution or merger or consolidation with another corporation, service of process may be had upon the Lieutenant Governor, and such return of service, when made upon the Lieutenant Governor, shall be valid service on the bank. Documents to be served in such cases shall be in triplicate, and the Lieutenant Governor shall promptly forward one set thereof to the principal executive officer of such bank, as disclosed by his current record, by registered or certified mail, return receipt requested, and the bank shall have thirty days from the date of such mailing in which to answer or otherwise take such action as may be appropriate. The Lieutenant Governor shall promptly transmit one set of such documents served to the Banking Board, and shall retain the third set, noting on the jacket thereof his actions taken and the dates thereof. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Penalty For Violation; Review (a) All banks and, to the extent of and with respect to business done at any branches established in the United States Virgin Islands, all foreign banks doing business in the United States Virgin Islands shall be regulated and supervised by the Banking Board in such manner as to secure the safe and sound conduct of such business, to prevent unsound practices, and thus to maintain the public confidence in such business and protect the public interest and the interests of depositors, creditors, and stockholders. (b) For the purpose of effectuating the policy declared in this section, the Banking Board, with the approval of the Governor of the United States Virgin Islands, may adopt regulations consistent with law and sound banking practice. Such regulations shall be brought to the attention of those affected thereby in the manner that the Banking Board may prescribed; provided, that all banks and foreign banks as a condition to doing business in the United States Virgin Islands shall secure their depositors by deposit insurance by any agency of the United States, or in the case of foreign banks not eligible for such deposit insurance, by comparable insurance or other security for depositors found satisfactory by the Banking Board; and provided further, that all banks and foreign banks doing business in the United States Virgin Islands shall provide themselves with protection and indemnity against burglary, embezzlement and other similar insurable loss; and if a bank or foreign bank refuses to comply with this requirement, the Banking Board shall make arrangements to furnish such protection and indemnity, charging the cost thereof to said bank or foreign bank. (c) For any violation of the regulations prescribed pursuant to subsection (b) of this section, the delinquent bank or foreign bank shall be subject to an administrative fine of not more than $1,000 for the first offense, and, for the second offense, to an administrative fine of not more than $5,000, and, in any such case, to the cancellation of its license. Such fine or cancellation shall be imposed or ordered by the Banking Board, with the approval of the Governor. In any such case, the Banking Board shall send written notice of its action to the bank or foreign bank affected as quickly as circumstances will allow, and if the cancellation of the bank's or foreign bank's license has been decided upon, shall transmit a written order to such effect to the Lieutenant Governor for appropriate action. The bank or foreign bank so penalized, either by fine, or by cancellation of its license, or by both, shall be entitled to a review of such action in the District Court if it files an appeal in such court within thirty days after receiving notice of such fine or cancellation. The service of the notice of appeal upon the Lieutenant Governor or his authorized representative shall operate as a stay of such order of cancellation pending the court's decision on the appeal. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Right of inspection; examiners (a) Every bank and every branch thereof, and every branch established in the United States Virgin Islands by a foreign bank doing business in the United States Virgin Islands, and every other entity engaged in the business of banking as provided in this title, shall be subject to inspection and supervision of the Banking Board, which shall either personally or through some competent person or persons appointed or approved by it, to be known as examiners, visit and examine the bank or branches thereof, or the branches of a foreign bank at least once a year. Scope of examination; confidential reports (b) On such examinations, inquiry shall be made as to the condition and resources of the bank or, to the extent of and with respect to business done at any branches established in the United States Virgin Islands, the foreign bank, the mode of conducting and managing its affairs, the action of its directors, the investment of its funds, the safety and prudence of its management, and the security offered for compliance with its contracted obligations; and whether the requirements of its charter and of the laws have been complied with in the administration of its affairs, and also as to such other matters as the Banking Board may prescribe. Reports rendered by examiners to the Banking Board, in connection with an examination made of any bank or branches thereof, or any branches established in the United States Virgin Islands of a foreign bank, shall be deemed to be of a confidential nature, except as provided in subsection (j) of this section. Board's power with respect to possible losses (c) The Banking Board shall have the power to direct any bank or foreign bank under the Board's supervision to charge against its undistributed profits, legal reserve fund or capital account in paid-in stock, any loan or part of loan, assets or part of assets, that in the Board's judgment constitutes a possible loss for the bank under examination, and it may direct, also, the segregation of any portion of future profits that it may deem advisable, until said capital account in paid-in stock and reserve fund have been restored to the original total amount thereof, and/or direct the creation of any asset valuation reserves that the Board may deem advisable. The Banking Board may impose an administrative fine up to $1,000 for each 5 days that the bank or foreign bank fails to comply with the orders issued under the provisions of this subsection; provided, however, that the bank or a foreign bank shall have 15 days after each order has been issued to comply therewith. If any bank or foreign bank on which an administrative fine is imposed under this subsection fails to pay the same within the term of 15 days following the date of notice thereof, the Banking Board may file civil action in the District Court to collect said administrative fine, for which purpose exclusive jurisdiction is hereby vested in the District Court. Oath of examiner; penalty for violation (d) Each bank examiner shall take an oath not to divulge the results of his investigations, except to the Banking Board, and in case of failure to keep such oath he shall be fined not more than $5,000 or imprisoned not more than one year, or both. Attendance and oath of witnesses (e) The Banking Board and every such examiner shall have power to administer oaths to any person whose testimony may be required on any such examinations, and to compel the attendance of any such person at any such examination. Certificate of results of examination (f) The Banking Board shall issue to every bank, or foreign bank, or branch thereof, examined by it personally or through its employees or examiners, a certificate setting forth the result of such examination, which certificate shall be presented to the Board of Directors at the first regular or special meeting of the said board held subsequent to the date of its receipt by such bank or foreign bank. Appointment and compensation of bank examiners (g) For the purposes of such examination, the Banking Board shall have power to appoint the bank examiners and fix their salaries. Examination fees (h) As an examination fee each bank so examined shall pay, with respect to itself and each of its branches so examined, each foreign bank shall pay, with respect to each of it branches in the United States Virgin Islands so examined, one third of the total cost of such examination and the sum so paid shall be covered into the Treasury of the United States Virgin Islands. The fees paid for such examination shall be established by regulations promulgated by the Banking Board, pursuant to title 3 Virgin Islands Code, chapter 35. Acceptance of examinations by federal agencies (i) The Banking Board of the United States Virgin Islands may accept, in lieu of an examination required or authorized herein, an examination made in the same year by the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System or a Federal Reserve Bank or in the case of a foreign bank an examination acceptable by the government by which that bank is first licensed. The Banking Board may accept, in lieu of any report of condition which may be required hereunder, a report of condition obtained by said Corporation, Board of Governors or Federal Reserve Bank. Furnishing information to federal agencies (j) The Banking Board of the United States Virgin Islands may furnish to the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System or a Federal Reserve Bank, or to any official or examiner thereof, a copy or copies of any or all examinations made of any banking organization and of any or all reports made by same and may give access to and disclose to said Corporation, Board of Governors or Federal Reserve Bank, or any official or examiner thereof, any and all information possessed by the Banking Board with reference to the conditions or affairs of any banking organization. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, §§ 4(14), (15), Sess. L. 2005, pp. 17, 18.

(a) Neither the Lieutenant Governor nor any representative of the Lieutenant Governor, nor any member of the Banking Board or employee thereof, nor any bank examiner shall, during the discharge of his office- (1) be an officer, director or employee in any bank, foreign bank, bank incorporated and organized under the National Bank Act (12 U.S.C. §12 et seq.) 12 U.S.C. §12datory thereof or supplementary thereto, or company affiliated therewith; (2) own or deal directly or indirectly in the shares or obligations of such bank, foreign bank, or affiliated company; (3) be interested in or receive directly or indirectly from such bank, foreign bank, or affiliated company, or from any of its officers, directors or employees, any salary, gratuity, compensation or other thing of value by way of gift, credit, compensation for services, or for any other reason; or (4) be interested in, or under obligation to negotiate, any loan, obligation or settlement for another person with such bank, foreign bank, or affiliated company. Any violation of this subsection by any official or employee referred to herein shall be sufficient cause for his removal from office by the Governor. (b) Notwithstanding the provisions of subsection (a) of this section, any official or employee referred to in such subsection may own or keep one or more banking accounts, either commercial or savings, and may rent safe-deposit boxes, in any bank, foreign bank, or affiliated company referred to in such subsection and doing business in the United States Virgin Islands, and may obtain a secured loan from any such bank, foreign bank, or affiliated company. Any member of the Banking Board may borrow from a bank or foreign bank on a secured loan with full disclosure to the Banking Board within ten days after obtaining the loan. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) Every bank or foreign bank shall make at least one report each year to the Banking Board within ninety days after close of the bank's fiscal year, and according to forms to be prescribed by it, verified by the oath of the chief executive officer and attesting officer, certifying and subscribing under oath that each of them has personal knowledge of the facts stated therein and that the same are true. Such reports shall exhibit in detail and under appropriate heads the resources and liabilities of the bank or foreign bank, provided that such reports by foreign banks shall show separately both the United States Virgin Islands operation and the complete operation of such foreign bank; and such report in condensed form shall be also published, at the expense of the bank or foreign bank, at least once in a newspaper of general circulation in each judicial division of the United States Virgin Islands. (b) Each bank shall report to the Banking Board twice each year detailing all fees, charge and penalties levied upon all financial or advisory transactions. (c) The Banking Board may also call for special reports from any bank or foreign bank whenever in its judgment the same are necessary in order to obtain a full knowledge of its condition. (d) Whoever certifies and subscribes any report required by this section which is false in any material effect shall be fined not more than $1,000 or imprisoned not more than one year, or both. (e) Any bank or foreign bank which fails to make, transmit, and publish any report required under this section shall be subject to a penalty of $10 per day for each day's delay after the period specified in this section. Any bank or foreign bank shall be deemed to have transmitted said statement to the Banking Board on and after the day when such bank has deposited the same in a United States Post Office in any town in the United States Virgin Islands, properly addressed to the Banking Board, postage prepaid and registered. (f) Whoever wilfully and knowingly subscribes to, or makes or causes to be made any false statement, or enters any false figures, statements, or entry in the books of any bank or corporation transacting a banking business in the United States Virgin Islands, or knowingly subscribes to, makes or circulates any false report or statement about the condition of any bank or banking corporation within the United States Virgin Islands, with intent to deceive the Banking Board or any person authorized to examine into the affairs of said bank or corporation, shall be imprisoned not more than five years. (g) Once made, each report and the contents thereof shall be deemed public records, and shall be made available for inspection, review and any other lawful purpose, upon request of any person. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended July 11, 1983, No. 4849, § 3, Sess. L. 1983, p. 122; Mar. 5, 2005, No. 6727, §§ 4(16), (17), Sess. L. 2005, p. 18.

History: Repealed. June 6, 1988, No. 5341, § 2, Sess. L. 1988, p. 163.

(a) Where, by the terms of a mortgage on real property or as otherwise required by a mortgagee, banking or lending institution, the mortgagor is required to make periodic payments which include sums to be allocated to an escrow account for the purpose of paying taxes, insurance or improvements to the mortgaged property, or any combination of such purposes, the mortgagee, banking or lending institution receiving the periodic payments shall furnish the mortgagor with a statement within 60 days of the close of the calendar year, showing the beginning balance of the escrow fund, total receipts received by the fund during the calendar year, an itemized statement of all expenditures from the fund during the calendar year, the balance in the fund at the end of the calendar year and interest accrued on the escrow account. (b) The annual statement specified in subsection (a) is not required where the mortgagor is provided with a monthly billing form or mortgagor passbook either of which provides the information required by subsection (a). History: Added Mar. 27, 1974, No. 3543, Sess. L. 1974, p. 57.

(a) Every mortgagee, banking or lending institution requiring a mortgagor to maintain an escrow account for the purpose of paying taxes, insurance or improvements or for insurance settlements or on behalf of the mortgage property, shall pay to or to the account of such mortgagor, interest on the average quarterly balance of such escrow fund at the rate of the prevailing percentage rate credited to the bank's passbook savings accounts. (b) Any mortgage, bank or lending institution that knowingly violates the provisions of this section shall be fined not more than $25 per account for each day the interest is not credited to the escrow account. History: Added Mar. 27, 1974, No. 3543, Sess. L. 1974, p. 57; amended Mar. 13, 1990, No. 5507, § 2, Sess. L. 1990, p. 22.

(a) Every foreign bank shall annually prepare a Community Reinvestment Act (CRA) statement for each island of the territory and shall include the CRA statements in its annual report filed under section 64 of this title. Each CRA statement shall contain: (1) the name of the island; (2) a list of specific types of credit (within certain categories, such as residential loans for one to four dwelling units, residential loans for five dwelling units and over, housing rehabilitation loans, home improvement loans, small business loans, farm loans, community development loans, commercial loans, and consumer loans) that the bank is prepared to extend within the local community; and (3) a copy of the Community Reinvestment notice provided for in subsection (c) of this section. Each current CRA statement shall be readily available for public inspection at each office or branch of the bank. Copies of current CRA statements shall be made available to the public for a fee not to exceed the actual cost of reproduction. (b) Each foreign bank shall maintain a CRA Public File that is readily available for inspection at the main office and each branch of the bank. The CRA Public File shall consist of: (1) any signed, written comments received from the public within the past 2 years that specifically relate to any CRA statement CRAto the bank's performance in helping to meet the credit needs of its community or communities; (2) any responses to the comments that the bank wishes to make; and (3) any CRA statements in effect during the past 2 years. These files shall not contain any comments or responses that reflect adversely upon the good name or reputation of any person other than the bank. (c) Within 90 days after the effective date of this act all foreign banks shall provide, in the lobby of each of its offices and branches, a public notice substantially in the following form: COMMUNITY REINVESTMENT ACT NOTICE The Virgin Islands Community Reinvestment Act requires the Banking Board to evaluate our performance in helping to meet the credit needs of our community, and permits the Banking Board to take this evaluation into account when the Board considers certain applications submitted by this Bank. Your involvement is encouraged. You should know that: You may obtain our current CRA statement for CRAs island in this office. (Current CRA statements forCRAher islands served by us are available at our head office, located at ____________________.) You may send signed, written comments about our CRA sCRAement[s] or our performance in helping to meet community credit needs to (title and address of bank official) and to the Banking Board. Your letter, together with any response by us, may be made public. You may look at a file of all signed, written comments received by us within the past 2 years, any responses we have made to the comments, and all CRA statements in effect during the past 2 years at our office located at (address). History: Added May 14, 1985, No. 5060, § 309(c), Sess. L. 1985, p. 48.

Any two or more financial institutions or other entities organized under the laws of any Territory, or state of the United States, may merge or consolidate into one sole entity which may be any of the merged or consolidated financial institutions. Such merger or consolidation shall be effected under the conditions and restrictions, and with the powers, specified in this chapter. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 18.

Financial institutions or other entities intending to merge or consolidate may enter into an agreement for merger or consolidation of said, financial institutions, in which agreement they shall establish the terms and conditions of such merger or consolidation; the manner of carrying it out; the name of the new financial institution (in case one is organized), or of the consolidated, financial institution as the case may be; the number, names and residences of the first directors and officers of the new financial institution or of the consolidated one, which directors and officers shall hold office until their successors are elected or appointed, whether under the provisions of this title or under the bylaws of the aforesaid financial institution; the number of shares of capital stock of the new financial institution, or of the consolidated financial institution, common or preferred stock to be specified as well as the par value of each of said shares; the manner of converting the capital stock of each of the merged or consolidated entity into shares or obligations of the new financial institution or of the consolidated financial institutions, and, in case of the creation of a new financial institution, the date and manner of electing or appointing the directors and officers, and, in addition, all such other provisions and details as said directors may consider necessary or advisable to perfect the aforesaid merger or consolidation, provided they are not in conflict with the provisions of this title. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 18.

The aforesaid agreement shall be submitted separately for consideration to the stockholders of each of the merging or consolidating financial institutions, at a meeting called for the purpose. A written notice shall be sent to the post-office address of each stockholder, not less than twenty days prior to the date fixed for the meeting. Said notice shall specify the place and purpose of the meeting at which the aforesaid agreement of the directors will be considered, and the stockholders of the financial institutions to be merged or consolidated shall vote separately for or against said agreement. Each share of stock or other interest, as applicable, shall entitle the holder thereof to one vote to be cast by the stockholder himself or by his proxy. In case the votes of the stockholders of three-fourths of the shares of capital stock issued by each of the corporations, or of the other interests, as applicable, of such other entity or entities, to be merged or consolidated are cast in favor of the aforesaid agreement, the fact shall be certified by the secretary of each of the respective corporations or other appropriate officer of such other entity or entities, under the seal thereof, and said agreement, thus approved and certified, shall be submitted to the Banking Board for approval or disapproval. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 19.

In making its determination, the Banking Board shall consider, among other factors, the public interest. If the board does not approve the merger or consolidation it shall, within ten (10) days of making such decision not to approve, serve notice of its determination on the applicant(s) by registered mail. If the Banking Board approves said agreement, it shall then be filed in the Office of the Lieutenant Governor, and shall thenceforth be considered as the merger or consolidation agreement or charter of said financial institutions. A copy of said merger or consolidation agreement, duly certified by the Lieutenant Governor, under his seal, shall constitute evidence of the existence of the new or the consolidated entity. The finding of the Banking Board disapproving a merger or consolidation agreement shall be final. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 19.

Once the aforesaid merger or consolidation agreement has been entered into, perfected and filed in the Office of the Lieutenant Governor, the banks or bank holding companies involved shall be considered as one sole entity under the name provided in the agreement (in case a new entity is created), or under the name of the consolidated entity into which are to be merged or consolidated the other entities, as the case may be, and said entity shall thenceforth enjoy all the rights, privileges and franchises and shall be subject to all the restrictions, obligations and duties of the entities so merged or consolidated, except for the alterations herein provided. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 20.

If any stockholder not voting in favor of said merger or consolidation agreement records his opposition to such merger or consolidation at the time of the meeting, or within twenty days thereafter, and demands payment of his shares, and if such merger or consolidation is carried out, in such case said stockholder may, within sixty days after the merger or consolidation, upon written ten-day notice on said corporation, petition the District Court to appoint three appraisers to estimate and determine the value of his shares, and the court shall make such appointment. It shall also designate the date and place where the appraisers shall first meet, and shall give them such instructions as to such procedure to be followed as the court may deem pertinent. The court shall also specify the date and manner in which the value of said shares shall be paid to the aforesaid stockholder. The appraisers shall meet on the date and at the place designated, and after taking oath, shall proceed to perform the duties imposed on them by the court and to estimate and determine the value of the aforesaid shares. They shall deliver a copy of their report to the court and to the corporation, and to the stockholder, if he demands it. All expenses incurred in determining the value of said shares shall be for account of the corporation. When the corporation has paid the value of the aforesaid shares, as the same may have been fixed by the appraisers, said shares shall be canceled and the stockholder shall cease to be a stockholder of the corporation or to have any interest therein, and the corporation may dispose of such shares of stock for its own benefit. In case of emergency, when necessary for a better protection of the interests of the depositors and of the bank, if the merger or consolidation is approved by the votes of the stockholders of three-fourths of the shares, such merger or consolidation agreement having been submitted to the consideration of the Banking Board and thereby approved, the stockholders who may not have agreed to said merger shall in all respects be subject to, and be bound by, such merger or consolidation. The Banking Board shall, in these cases, certify that the merger was made on account of an emergency, and that, in its opinion, the same will be beneficial to the public interest. Should the Banking Board disapprove the merger or consolidation agreement made by reason of emergency, it shall, within the term of ninety days, serve notice of its determination by registered mail on the banks interested in the agreement. The finding of the Banking Board disapproving a merger or consolidation agreement made for reasons of emergency shall be conclusive. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When a merger or consolidation is made under the provisions of this title, each and all the property, shares, rights, franchises, powers and privileges of the merged or consolidated financial institutions shall become the property of the consolidated or of the newly organized financial institution, without need of executing any instrument or document of conveyance, and the consolidated or newly organized financial institution, as the case may be, shall have, as regards such property, shares, rights, franchises, powers and privileges, the same rights as the merged or consolidated entities had. In order that the consolidated or the newly organized, financial institution as the case may be, may have recorded in its name the properties, shares, rights and franchises as a result of such merger or consolidation, it shall file a copy of the merger or consolidation agreement, certified by the Lieutenant Governor, under his seal, in the Office of the Recorder of Deeds in the judicial division in which the principal office of the corporation is located, and in the Office of the Recorder of Deeds of each other judicial division in which may be located any real property of the corporation, and, upon payment of the recording fees fixed by law, such instruments shall be admitted to record. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 20.

The obligations of the merged or consolidated financial institutions and the rights of the creditors of any of them shall in no case be prejudiced or impaired in any way by such merger or consolidation, and none of the rights, obligations and claims of any person, creditor, depositories and trustees, shall be affected by such merger or consolidation, and the consolidated or newly organized entity as the case may be, shall have all the obligations and shall be liable for all debts and the fulfillment of all the contracts and obligations of the merged or consolidated entities, just as they were prior to such merger or consolidation, and the stockholders of said entities so merged or consolidated shall continue subject to the same obligations, claims and demands as existed against them when the merger or consolidation was made or before that time, and all suits, actions or other proceedings then pending in any court, to which any of the merged or consolidated entities is a party, shall continue to their termination just as if no such merger or consolidation had taken place; provided, however, that the consolidated corporation or the newly organized entity, as the case may be, may be substituted in place of any of the entities which have merged or consolidated, by order of the court taking cognizance of the proceedings. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(18), Sess. L. 2005, p. 21.

Filing of charter or articles of incorporation and statement (a) Upon compliance with the provisions of this chapter, any banking corporation organized under the laws of any other territory or state or of any foreign country, which operates a bank and does business at the place of its incorporation, may do business and establish offices in the United States Virgin Islands, provided that, before beginning its operations in the United States Virgin Islands, it files in the Office of the Lieutenant Governor a duly authenticated copy of its charter or articles of incorporation, and a statement verified by oath of the president, manager, agent, cashier, or other authorized officer of said bank, and attested by a majority of its Board of Directors, showing- (1) the name of such foreign bank; (2) the location of its existing or proposed main offices or places of business within and without the United States Virgin Islands; (3) the object or objects of its business; (4) the amount of its authorized capital; (5) the amount of its capital stock actually paid in cash; (6) the amount of the assets of the bank, and of what they consist, and the actual cash value thereof; (7) an itemized statement of the liabilities of such foreign bank, whether any of its indebtedness is secured, and if so, how secured; (8) the amount of capital to be devoted to its business in the United States Virgin Islands, which in no case shall be less than $100,000; (9) the name and post-office addresses of the chief executive officers in the home bank and all officers in the United States Virgin Islands, and the time when the term of office of each expires. Thereafter, as each such officer retires from office, such foreign bank shall promptly, and in the same form, notify the Lieutenant Governor of the name and address of his successor in office, to the end that the Lieutenant Governor shall at all times have a current list of names and addresses of all such officers. Consent to be sued; designation of agent for service of process (b) Such foreign bank shall also file at the same time, and annually not later than the fifteenth day of March, in the Office of the Lieutenant Governor, a certified true copy of a resolution approved by a majority of its Board of Directors under the official seal of the foreign bank and the signatures of its chief executive officers or attesting officer, and its cashier if there is one, certifying that the foreign bank has consented to be sued in the courts of the United States Virgin Islands upon all causes of action arising against it in the United States Virgin Islands, and that service of process, as well as any other judicial return, may be made on a determined person, a resident of the United States Virgin Islands, whose name and place of residence shall be designated in such certificate; and such return of service, when so made upon such agent, shall be valid service on the foreign bank. The written consent of the person so designated to act as such agent shall also be filed in like manner and such designation shall remain in force until the filing in the same office of a written revocation thereof, executed in like manner, in which case some other person shall be designated to act as such agent. A certified copy of a designation so filed, accompanied by a certificate that it has not been revoked, is presumptive evidence of the execution thereof, and shall be conclusive evidence of the authority of the officer executing it. Alternate agent for service of process (c) If any foreign bank fails to designate a person authorized to accept service of process on its behalf, or if such person dies, becomes incompetent, or cannot by exercise of due diligence be found, within the United States Virgin Islands, and, in any case, after a foreign bank has withdrawn its presence from the United States Virgin Islands, by liquidation or otherwise, service of process may be had upon the Lieutenant Governor, and such return of service, when made upon the Lieutenant Governor, shall be valid service on the foreign bank. Documents to be served in such cases shall be in triplicate, and the Lieutenant Governor shall promptly forward one set thereof to the principal executive officer of such bank, as disclosed by his current record, by registered or certified air mail, return receipt requested, and the foreign bank shall have forty days from the date of such mailing in which to answer or otherwise take such action as may be appropriate. The Lieutenant Governor shall promptly transmit one set of documents served to the Banking Board, and shall retain the third set, noting on the jacket thereof his actions taken and the date thereof. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) No foreign bank may open any branch, or change the location of any branch, in the United States Virgin Islands without a permit so to do from the Banking Board. An application to the Banking Board for such permit shall state the benefit to the public expected to result from the granting of the permit applied for. The Banking Board, upon receipt of such application, may require the submittal of such additional information as may be necessary in order for the board to make the investigations and reach the decision hereinafter in this section required of such board. (b) It shall be the duty of the Banking Board, immediately after it receives an application for a permit, to make whatever investigations may be necessary as to: (1) the overall financial condition of the applicant; (2) whether or not granting the application would reasonably be apt to result in an over-extension of applicant's resources or facilities; (3) character and repute, as well as the banking and commercial experience of applicant and its directors and executive officers; (4) whether the bank shall be of benefit to the general public; and (5) the capital which the bank has available for its operations in the United States Virgin Islands. (c) The Banking Board may issue the permit applied for if, in its judgment, the result of the investigations are satisfactory; provided, that the decision of the Banking Board shall be final; and provided further, that all expenses incurred by the Banking Board in connection with such investigations shall be paid by the applicant in conformity with regulations which the board may make and promulgate for the purpose. (d) Upon the issuance of a permit to an applicant, the Banking Board shall forthwith transmit a certified copy thereof to the Lieutenant Governor, who shall file it along with such other documents submitted to the Lieutenant Governor under the provisions of section 101 of this title. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Every foreign bank which is engaged in banking operations in the United States Virgin Islands shall be under obligation to retain therein either as loans, bonds of the Government of the United States or of the Government of the United States Virgin Islands or obligations of the political subdivisions thereof, real property situate in the United States Virgin Islands, or in cash, an amount equal to 75 percent of the total amount of its deposits of residents in the United States Virgin Islands; provided, however, that checks, bills of exchange, drafts and other instruments deposited for collection shall not be considered as deposits of money until such checks, bills of exchange, drafts and other instruments have been collected and paid. The violation of this provision shall be sufficient cause for the cancellation of its license. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) When the permit of the Banking Board is received by the foreign bank, as provided in section 102 of this title, it shall proceed to comply with all applicable provisions of law so as to place it in readiness to commence business upon issuance to it of the license provided by section 43 of this title. When such foreign bank is in such position of readiness, it shall notify the Banking Board, by means of a statement of all facts necessary to enable the Banking Board to determine whether such foreign bank has in fact complied with all the requirements of law and is lawfully entitled to commence business, such statement to be sworn to by a majority of the directors and by the president or manager of such foreign bank. (b) Upon receipt of such statement by the Banking Board the board shall make such investigations as may be necessary to assure itself that the foreign bank has in fact complied with all the provisions of law to entitle it to a license to engage in the business of banking. (c) If, upon a careful examination of the facts so reported, or any other relevant facts which may come to the knowledge of the Banking Board, the board is satisfied that the foreign bank has obtained the deposit and other insurance coverage required by subsection (b) of section 61 of this title, and that such bank has complied with all of the provisions of this chapter required to be complied with before a foreign bank shall be authorized to commence the business of banking in the United States Virgin Islands, the Banking Board shall direct the Lieutenant Governor to give such foreign bank a certificate, under his hand and official seal, stating that such foreign bank has complied with all the requirements of law, and that it is authorized to commence business immediately upon the issuance of a license thereto in accord with the provisions of section 43 of this title. But the board may withhold from a foreign bank the certificate authorizing it to commence business, whenever it is satisfied that the foreign bank seeks to do business in the United States Virgin Islands for any other than the legitimate objects determined by this chapter. (d) The expense incurred by the Banking Board in connection with such investigation shall be paid by the foreign bank in conformity with regulations which the board may make and promulgate for the purpose. (e) The president or manager of the foreign bank shall cause the certificate issued under subsection (c) of this section to be published once a week during five consecutive weeks in a newspaper of general circulation in each judicial division of the United States Virgin Islands. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No foreign bank shall transact business in the United States Virgin Islands except upon compliance with the applicable provisions of this chapter. Violations of this chapter shall be punished by a fine of not to exceed $1,000 for each day that the violation continues. Any person who shall make a false oath in any case where an oath is required under this chapter, or any person filing or causing to be filed said oath, in the United States Virgin Islands, shall be guilty of perjury. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(1) (a) A financial institution may, at its discretion, establish days and hours for its offices, provided that it shall post the days and hours of operation at or near the public entrances to its offices. (b) A financial institution may temporarily close any of its offices for reasons that include but are not limited to good cause, emergency weather conditions and community events. If a financial institution temporarily closes any of its offices for all or any part of a business day, the institution shall post a conspicuous notice of the closing at all points of public access to the closed offices. A closing may not become effective until such notice is posted at the office to be closed. Posting this notice relieves the institution from liability for failure to perform any of the business of the financial institution at the closed offices. (c) Any act authorized, required or permitted to be performed at, by or with respect to any financial institution on a day not defined as a business day or on a day the financial institution is closed pursuant to paragraph (4) of subsection (d) [sic] hereof may be performed an the next succeeding business day and liability or loss of rights of any kind may not result from such delay. (d) Any financial institution authorized to do business in the Territory may permit any of its branch offices, facilities or walk-up or drive-up windows of its main office or branch offices to remain open, or open for limited functions only, during such hours as it may determine from time to time. Any hours in which the branch office, facility or walk-up or drive-up window of its main office or branch office is open for limited functions only after its main office is closed are, with respect to such financial institution, not considered to be part of a business day. (2) Any act authorized, required or permitted to be performed at or by, or with respect to, any such financial institution during hours at which said branch office, facility, or walk-up or drive-up window of its main office or branch office is open for limited functions only after its main office is closed may be so performed on the next succeeding business day, and no liability or loss of rights of any kind shall result from such delay. (3) Nothing in any law of this Territory shall in any manner whatsoever affect the validity of, or render void or voidable, the payment, certification or acceptance of a check or other negotiable instrument or any other transaction by a financial institution in this Territory because it was done or performed during such hours in which a branch office, facility, or walk-up or drive-up window of its main office or branch is open for limited functions only after its main office is closed. (4) Whenever it shall appear to the Governor that the welfare and security of financial institutions under the supervision of the Banking Board, or their depositors, shareholders, staffs or customers require, or that the welfare of the Territory, any section thereof, the inhabitants thereof, financial institutions, their depositors, shareholders or staffs have been or may be adversely affected by actual or threatened national emergency, forces of the natural elements, fires, explosions, strikes, epidemics, civil strife or commotion, or any other circumstances hazardous or dangerous to life, limb or property, the Governor may proclaim that a banking emergency exists. The Governor may declare such banking holidays as in his judgment such emergency conditions may require and that any financial institution or institutions shall be subject to special regulation as provided until the Governor, by a like proclamation, declares the period of such emergency to have terminated if he has not defined such period in the original proclamation. History: Added Mar. 5, 2005, No. 6727, § 4(19), Sess. L. 2005, p. 23.

In addition to the general powers conferred upon domestic corporations or other organizational entities the structures of which are used by banks under the laws of the United States Virgin Islands, every bank, and, with respect to business done at any branches established in the United States Virgin Islands and without limitation or restriction upon the powers exercised by it outside the Virgin Islands every foreign bank, every bank holding company, financial institution holding company, or financial holding company authorized to do business in this Territory shall have power, directly or indirectly through one or more authorized agents, subsidiaries or other affiliates, joint ventures, bank holding companies, financial holding companies, financial institution holding companies, or any combination thereof, subject to compliance with applicable federal law, to offer the following products and services and engage in the following activities to such extent, on such terms, and subject to such terms and conditions as may be determined by the exercise of the business judgment of such person, persons or other entity or entities as may have decision making authority for such entity to: (1) Purchase, sell, discount and negotiate bills of exchange, drafts, promissory notes and other negotiable paper; to make loans for a specified term or on demand to natural or artificial persons on personal, collateral or "mortgage" security, or secured by goods in warehouse or standing crops; and to contract loans and advances with the Government of the United States Virgin Islands or its dependencies. When the loan is a personal loan, it shall be within the powers of the bank or foreign bank to determine, in each case, whether the note shall bear one or more signatures; provided, that where the loan is secured by a "mortgage" on real property, the aggregate total of such loans may not exceed the aggregate paid-in capital stock and the legal reserve of the institution, nor exceed the aggregate total of its deposits in savings accounts and term accounts and advances, if any, from the Federal Home Loan Bank system, whichever is greater; and provided, further, that this limitation is not applicable when a "mortgage" is given by a borrower as additional and secondary collateral and merely to secure the loan in last instance, nor is it applicable to loans secured under the National Housing Act nor to loans guaranteed by the Veterans Administration; provided there exists a binding obligation on the part of the Federal Government or the government of any state or the Government of the United States Virgin Islands or its instrumentalities or agencies, or any public or private retirement system or any financial institution of proved economic solvency, to buy such loans. A loan secured by real property shall be deemed to include a loan on unimproved real estate. (2) Receive deposits and keep accounts current, with or without interest; provided that no interest shall be paid on demand deposits. (3) Buy and sell drafts and deal in gold and silver; receive securities on deposit and make collections and payments for account of others. (4) Raise funds on its own surety, or on that of another bank or foreign bank, partnership or individual, or on securities belonging to such bank or foreign bank, or otherwise to negotiate such securities when advisable; pledge assets as collateral to secure deposit of funds of the Governments of the United States and of the United States Virgin Islands, and subdivisions and dependencies thereof, including courts of justice. (5) Buy bonds of other financial, agricultural, railroad, public utility or industrial companies, and to dispose of such bonds whenever it shall be deemed advisable to do so. A bank or foreign bank may also take charge of the liquidation of the business of partnerships or companies of any kind. (6) Buy interest-bearing bonds and obligations of the Government of the United States, states or municipalities of the United States, or of the Government of the United States Virgin Islands or its dependencies, the interest on which is not in arrears, and to sell the same whenever it shall be deemed advisable. (7) Issue obligations secured by real property or mortgages owned by such bank or foreign bank. (8) Purchase, hold and receive by conveyance any real property for the following purposes, but for no others: (A) Such as may be necessary for its accommodation in the transaction of its business, and for other offices of hire in the same building, or the purchase of accommodations for its personnel; (B) Such as shall be conveyed to it in satisfaction of personal or mortgage debts previously contracted in the course of its dealings; (C) Such as may be purchased or acquired at sales under judgments, decrees, or mortgages held by the bank or foreign bank, or as may be purchased or acquired to secure debts due it. No bank or foreign bank shall hold for a period longer than five years any real property acquired by virtue of subdivisions (B) and (C) of this subparagraph. After the lapse of said five years, if the bank or foreign bank has not disposed of said property, the Banking Board shall sell the same at public auction and turn over to it the net proceeds of the sale, fixing as the minimum price thereof the official assessed value of the properties to be sold. (9) Establish and conduct a savings department. (10) Take, accept and comply with or execute all kinds of trusts that may lawfully be committed to it, acting as trustee in all cases prescribed by law, receiving deposits of money in trust for any special and specific purpose whatever; act as executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, or committee of estates of lunatics or in any other fiduciary capacity; and in general, to carry out all kinds of trusts or other fiduciary transactions with ample power and authority; It being understood, That in order to carry out these acts, the bank or foreign bank shall previously deposit with the Lieutenant Governor such sum as may be promulgated by the Banking Board, payable in cash or in bonds of the United States Virgin Islands or Federal Government. After such deposit has been made, the Banking Board shall issue a license to such bank or foreign bank in order that it may act as trustee in all such trusts as are granted or committed to it. This chapter in no way changes or alters the provisions of any law relating to trust companies. (11) Purchase and hold the stock of small business investment companies authorized to operate under the Small Business Investment Act, as amended, and the stock of economic development corporations created pursuant to chapter 11 of Title 13 of this Code, in an amount not aggregating more than ten (10%) percent of the banks capital and surplus. (12) Transact any other business proper for this class of institutions. But no bank shall transact any business except such as is incidental, necessary and preliminary to its organization, until it has been authorized by the Banking Board to commence the business of banking. (13) Employ, affiliate with or hire as a third-party agent an insurance producer or consultant if the producer or consultant is duly licensed under title 22 Virgin Islands Code. A bank may: (A) establish criteria for acceptance or rejection of insurance policies based on the identity, reputation, history or other information about the issuer; as authorized by law; (B) accept or make any payment of brokerage commissions or fees for insurance agency or brokerage services; and (C) allow discounts for purchase of more than one product or service, including loans or other extensions of credit provided that anti-tying prohibitions are observed. (14) Sell, offer, or any other manner be a party to or otherwise make available debt cancellation contracts. (15) To control or hold an interest in a subsidiary that engages in any activity permissible for a national bank to conduct through an operating or financial subsidiary. (16) To engage in any activity or to control or hold an interest in a subsidiary that engages in any activity determined to be permissible for an insured state or territorial bank or the subsidiary of an insured state or territorial bank under the laws of any state or territory by the FDIC pursuant to 12 U.S.C. section1831a, provided that at least sixty (60) days prior to doing so written notice has been filed with the Banking Board and the Banking Board has approved. (17) To assess fees and charges to the extent and subject to the same terms and conditions as are applicable to national banks in accordance with 12 CFR §§ 4001 or 4002. (18) To establish, acquire and hold interests in a subsidiary or affiliate engaged in activities permissible under the federal Gramm Leach Bliley Act, as amended, and the Bank Service Corporation Act. (19) To offer and provide any services that: (A) constitute the business of banking as defined in this title or by or pursuant to federal law, rule or regulation or are incidental or complementary to the business of banking or such services of a financial nature; or (B) are deemed to be financial in nature in accordance with 12 U.S.C. 1.S.C. §12)(a) as amended; or (C) to exercise any power and offer any product or service or engage in any activity, and acquire and retain the shares or other interests of any company engaged in any activity that is at the time authorized or permitted to any bank, savings and loan, or other financial institution in any state or territory of the United States, provided that at least sixty (60) days prior to commencement of any such power, product, service or activity or the acquisition of any company engaged or having the right to engage in or otherwise offer any such product, service, power or activity, the financial entity, has filed with the Banking Board written notice stating its intent to exercise such power, offer such product or service, or engage in such activity and setting forth the authority under which the authority to exercise, offer or engage in such power, product, service or activity is asserted, and the Banking Board has approved. (20) To issue and process credit cards, provided that no credit franchisor, system, network or issuer shall impose on any Virgin Islands financial entity any requirements for membership or otherwise doing business with such credit card franchisor, system, network or issue which are different from the requirements it imposes on any federally insured depository institution located in any of the states comprising the United States of America. (21) To exercise all powers necessary or convenient to effect the purposes for which it is organized or further the business in which it is lawfully engaged. (22) While acting as a creditor, to make insurance available, provided that where the indebtedness is secured by a mortgage on real estate and where a separate charge is made to the debtor for that insurance, the insurer shall make the insurance available jointly to the debtor and not more than one comaker of the indebtedness, provided that both are individually and jointly liable to repay the indebtedness. The foregoing shall not be deemed to restrict the insurer's right to require all debtors to meet the requirements of the applicable policy in order to become insured. Nothing in this subsection shall prohibit the insurance on the life of one debtor only, if desired by the debtor, or curtail the right of the debtor to decline such insurance coverage, unless otherwise appropriately required by the creditor in accordance with the law. (23) To sell, or arrange through a licensed third party, for the sale of annuities purchased from a licensed insurance company and may share commissions in connection with the sale of annuities pursuant to the provisions of title 22 Virgin Islands Code. An employee of such an entity, must be licensed in accordance with title 22 Virgin Islands Code before engaging in any of the activities concerning the sale of annuities authorized by this subsection. (24) To establish, acquire or invest in the capital stock, obligations or other securities of a service corporation, or otherwise participate in or utilize the service of such a corporation. A service corporation in this Territory may be owned by one or more financial institutions authorized to engage in the business of banking in this Territory. The stock of a service corporation in this Territory pursuant to this section may be owned only by institutions engaged in the business of banking and authorized to do business in this Territory. The maximum amount of investment in any one such service corporation may not exceed 20% of the investor institution's total capital and reserves or its total surplus account. The aggregate investment of any financial institution in all service corporations may not exceed 50% of its total capital and reserves or its total surplus account. For purposes of applying the legal lending limit prescribed in this title, a bank's investment in a service corporation, if majority owned, must be consolidated with the bank on a line-for-line basis proportionate to the bank's ownership interest in the service corporation. A financial institution seeking to invest in one or more service corporations shall notify the Banking Board in writing at least 30 days prior to such investment. If the services are to be performed for the public, as well as other financial institutions, the financial institution shall so state in its application with the Board. In addition to the criteria set forth by law, the Board may also consider the type of institution making application and the competitive effect of the proposed transaction. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended July 27, 1972, No. 3278, § 2, Sess. L. 1972, p. 245; Oct. 19, 1984, No. 5014, § 224(b), Sess. L. 1984, p. 371; Mar. 5, 2005, No. 6727, §§ 4(20)-(22), Sess. L. 2005, pp. 23-26.

(a) Subject to such additional requirements as the Banking Board may impose, every bank or foreign bank shall maintain a legal reserve which shall not be less than 20 percent of its demand liabilities, excepting deposits of the United States Virgin Islands or Federal Government, secured by actual collateral. Said reserve shall be composed of the following: (1) Not less than 6 2/3 percent of said obligations shall consist of lawful money of the United States. (2) Not more than 3 1/3 percent of said obligations may consist of checks on banks, branches of foreign banks, national banking associations or trust companies located in any part of the United States Virgin Islands, to be presented for collection during the day following on which they are received. (3) Ten percent shall consist of readily marketable obligations of the United States Government or money deposited in other banks, or in other branches of foreign banks, national banking associations, or trust companies located in any part of the United States Virgin Islands; provided, that deposits in such banks or trust companies are authorized by the Banking Board, subject to immediate collection. The remaining demand liabilities shall be kept by the bank or foreign bank in such securities and cash and loans as may be prescribed by law or by regulations of the Banking Board. (b) The Banking Board may increase the minimum legal reserve established in this section, up to not more than 30 percent of the total demand liabilities of the bank or foreign bank, except deposits of the Government of the United States Virgin Islands, the public corporations and instrumentalities of the United States Virgin Islands, or of the United States Government, secured by actual collateral, when in its judgment the circumstances so require it; but the order increasing the minimum legal reserve shall not be effective until thirty days after it is entered, provided this time might be extended by the Banking Board. (c) The legal reserve requirements established in this section shall be computed on the basis of the reserve average maintained for a week, such computation to be made on Monday every week. Every bank and foreign bank subject to the provisions of this section shall render to the Banking Board a weekly report certified by a bank officer duly authorized therefor, wherein shall be recorded the daily computation of the legal reserve maintained by such bank or foreign bank, and the reserve average maintained during the week. (d) The Banking Board shall notify any bank or foreign bank whose legal reserve is less than that required by this section of its obligations to make up the full amount. If such bank or foreign bank fails to do so within a period of thirty days, it may be declared in liquidation by the Banking Board, provided it is a bank incorporated under this title, and it shall be treated by the Banking Board as a corporation in liquidation. If it is a foreign bank, the Banking Board shall order the cancellation of its license by the Lieutenant Governor and the liquidations of its business in the United States Virgin Islands. (e) In the case of foreign banks doing business in the United States Virgin Islands, the term "demand liabilities" as used in this section shall be limited in meaning to those demand liabilities which are payable at such foreign banks' branches established in the United States Virgin Islands. (f) The Banking Board is hereby authorized to levy on and collect from any bank or foreign bank an administrative fine of not less than $25 nor more than $100 for each week on which said bank or foreign bank has failed to maintain the minimum legal reserve required or which may be required under this section. If any bank or foreign bank on which an administrative fine is levied under this subsection fails to pay same within the term of fifteen days from the date of notice of levying such administrative fine, the Banking Board may, for the purpose of collecting said administrative fine, file a civil action in the District Court. (g) The provisions of this section prescribing the legal reserve shall not apply to any bank which is a member of the Federal Reserve System, for so long as such bank remains a member of such system, and in such case the reserve requirements demanded by the Federal Reserve System shall be deemed sufficient. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) No bank or foreign bank may make to any one person, firm, partnership or corporation, one or more loans or discounts totaling more than 15 percent of the paid-in capital, reserve, and undistributed profits of such bank or foreign bank, nor shall it accept the security of any one person, partnership or corporation in an amount exceeding 15 percent of its paid-in capital stock. This restriction shall not apply to loans or discounts secured by collateral worth at least 125 percent of the amount of the loan, or to loans secured by mortgages, or to discounts of bills of exchange, provided such loans so secured by said collateral or mortgages, and such discounts of bills or exchange issued under such conditions do not exceed 331/3 percent of the bank's or foreign bank's paid-in capital, plus its reserves and undistributed profits, including the loans and discounts referred to in this subsection. In the application of these limitations the total amounts of the loans and discounts made to any one person, firm, or corporation, plus the loans on which the same person, firm or corporation is security, shall not exceed, in all, the 331/3 percent hereinbefore mentioned. In the cases in which capital notes or capital debentures have been issued for the purpose of strengthening the capital of any institution organized in accordance with this title, such funds shall be considered capital stock, as said term is used in section 35 of this title. Such capital notes and capital debentures shall be shown and designated separately in all the Statements of conditions which are published. Such capital notes and capital debentures shall not be subject to the payment of taxes. Any violation of these provisions shall be sufficient reason for the cancellation of the license of the bank or foreign bank guilty of such violation. (b) No bank or foreign bank shall make loans or discounts secured by its own stock, nor shall it purchase and hold its own stock, unless such security or purchase is necessary to prevent losses because of a debt previously contracted in good faith; and the stock so purchased or acquired shall be sold at public or private sale within the term of one year from the date of purchase. The directors or the manager of any bank or foreign bank who violates the provisions of this subsection shall be fined in an amount equal at least to the par value of the stock purchased or acquired in violation of this provision. (c) No bank or foreign bank, or any director, officer, agent or employee thereof shall purchase, or be in any way directly or indirectly interested in the purchase of any promissory note or other negotiable paper issued by said bank (shares and bonds issued by said bank excepted) for a lesser sum than that for which it is drawn, or for less than the market value. Any bank or foreign bank or person violating this provision shall be fined in an amount equal at least to three times the face value of the document so purchased. (d) No director, officer, or employee of a bank or foreign bank shall obtain a loan in such bank or foreign bank, except upon approval of such loan by a two-thirds vote of the Board of Directors or trustees. Any person wilfully violating the provisions of this subsection shall be fined in an amount equal at least to twice such amount as shall have been obtained by him, or imprisoned not more than one year, or both. The officer, agent or employee of the bank or foreign bank granting such loan shall be fined in an amount equal to twice such amount as may have been loaned, or imprisoned not more than one year, or both. (e) With respect to a foreign bank and the directors, officers, agents and employees thereof, the prohibitions, limitations and restrictions contained in this section shall be limited in their application to transactions entered into or performed at any branch thereof established in the United States Virgin Islands. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Mar. 5, 2005, No. 6727, § 4(23), Sess. L. 2005, p. 26.

It shall be unlawful for any director, officer, agent or employee of any bank or foreign bank to certify any check drawn upon said bank unless the person or company drawing the check has on deposit with the bank, at the time such check is certified, an amount not less than the amount specified in such check. Any check so certified by duly authorized officers shall be a valid obligation against such bank or foreign bank when in the hand of any person holding such check in good faith. Whoever, being a director, officer, agent, or employee of a bank or foreign bank, knowingly violates this section, shall be fined not more than $5,000 or imprisoned not more than five years, or both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whoever, being a president, director, or cashier, or an officer, employee, or agent of any bank or foreign bank- (1) embezzles, abstracts, or wilfully misapplies, any of the moneys, funds, or credits of the bank or securities therein; or (2) without being duly authorized, issues or draws any certificate of deposit, order or bill of exchange, mortgage, judgment, or decree; or (3) makes any false entry in any book, report, or statement of such bank with intent, in any of such cases, to injure or defraud the bank or any other company, body politic or corporate, or any individual person, or to deceive any officer of the bank, shall be imprisoned not more than ten years. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) Whoever, being an officer, agent, collector, teller, or clerk of any bank or foreign bank doing business in the United States Virgin Islands, receives any deposit knowing that such bank or foreign bank is insolvent- (1) if the amount or value of such deposit is less than $25, shall be fined not more than $100 or imprisoned not more than six months, or both; or (2) if the amount or value of such deposit is $25 or more, shall be fined not more than $3,000 or imprisoned not more than five years, or both. (b) Any bank or foreign bank shall be deemed insolvent, for the purposes of this title, when upon an examination made by the Banking Board, or by any of its authorized representatives, it is found that such bank or foreign bank has lost its entire reserve and one-third part or more of its capital stock. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

All transfers of notes, bonds, bills of exchange or credits of any bank or foreign bank or of deposits to the credit thereof, and all assignments of mortgages, security on real property, or of judgments or decrees in favor of such bank, and all deposits of money, gold and silver in bars, or other thing of value for its use or for the use of its stockholders and creditors, and all payments of money to such stockholders or creditors, made after being in a state of insolvency, as defined in this title, or in the expectation thereof, with the intent of preventing the application of the assets of such bank in the manner herein prescribed, or with the intent of giving preference to one creditor over another, shall be null and ineffective, and no attachment, foreclosure or writ of injunction shall issue against such bank or foreign bank, against its properties, before final judgment is rendered in any suit, action or proceedings in the District or Superior Court. Whoever, being a director of a bank or foreign bank, knowingly violates or knowingly allows any officer, agent or employee thereof to violate this section, shall be fined not more than $3,000 or imprisoned not more than five years, or both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whoever knowingly, in his own name or in representation of a natural or artificial person, furnishes a bank or foreign bank any false information or financial statements, with the purpose of inducing the bank to grant credit, to give banking facilities, or make any business transactions with the natural or artificial person in relation to whom the false financial statements were rendered or the false information given, shall be fined not more than $1,000 or imprisoned not more than one year, or both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Every bank or foreign bank shall keep an accounting system which shall reflect the financial condition of the bank or foreign bank, and its relations, operations and transactions with third persons whether natural or artificial, and with government organizations, and shall keep and maintain such books, records and documents which show such relations, operations and transactions. Every bank or foreign bank may destroy such books, records and documents, with authorization and under the supervision of the Banking Board, after the lapse of ten years from the date of the last entry made in such books or records, or from the date on which any obligation may have ceased to be demandable under the documents in its possession. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whoever, being an officer, a director, or an employee or agent of a bank or foreign bank, stipulates, receives, or acquiesces in or agrees to receive any fee, commission, gift or thing of value, from any person, firm or corporation, for obtaining, or trying to obtain, for such person, firm or corporation, or for any other person, firm or corporation, any loan, or the purchase or discount of any document, promissory note, draft, check or bill of exchange, by such bank or foreign bank, shall be fined not more than $5,000 or imprisoned not more than one year, or both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any person who knowingly and maliciously makes, circulates or transmits to another, or to others, any statement, rumor or suggestion, whether written, printed, or by word of mouth, which directly or by inference redounds to the discredit of the financial condition of any bank, foreign bank, or branch of a bank or foreign bank, doing business in the United States Virgin Islands, or which affects the solvency or credit of such bank, foreign bank, or branch of a bank or foreign bank, or any person who advises, aids, procures, or induces another to originate, transmit, or circulate any such statement or rumor, shall be guilty of a felony, and upon conviction shall be punished by a fine of not less than $500, or by confinement in the penitentiary for a term of not more than five years, or by both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Every financial institution authorized to do business in the Territory shall cash any properly endorsed retirement check issued by the United States Virgin Islands Government Employees Retirement System and any social security check issued by the United States Government without regard to whether the payee has an established account with the institution at which the check is presented. The payee must present two United States Government issued photo identifications. History: Added Nov. 15, 2011, No. 7325, § 1, Sess. L. 2011, p. 294.

This subchapter may be cited as "The Virgin Islands Uniform Multiple-Person Accounts Act." History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 54.

In this subchapter: (1) "Account" means a contract of deposit between a depositor and a financial institution, and includes a checking account, savings account, certificate of deposit, and share account. (2) "Agent" means a person authorized to make account transactions for a party. (3) "Beneficiary" means a person named as one to whom sums on deposit in an account are payable on request after death of all parties or for whom a party is named as trustee. (4) "Financial institution" means an organization authorized to do business under Virgin Islands or federal laws relating to financial institutions, and includes a bank, trust company, savings bank, building and loan association, savings and loan company or association, and credit union. (5) "Multiple-party account" means an account payable on request to one or more of two or more parties, whether or not a right of survivorship is mentioned. (6) "Party" means a person who, by the terms of an account, has a present right, subject to request, to payment from the account other than as a beneficiary or agent. (7) "Payment" of sums on deposit includes withdrawal, payment to a party or third person pursuant to check or other request, and a pledge of sums on deposit by a party, or a set-off, reduction, or other disposition of all or part of an account pursuant to a pledge. (8) "POD designation" means the designation of: (A) a beneficiary in an account payable on request to one party during the party's lifetime and on the party's death to one or more beneficiaries, or to one or more parties during their lifetimes and on death of all of them to one or more beneficiaries, or (B) a beneficiary in an account in the name of one or more parties as trustee for one or more beneficiaries if the relationship is established by the terms of the account and there is no subject of the trust other than the sums on deposit in the account, whether or not payment to the beneficiary is mentioned. (9) "Receive" as it relates to notice to a financial institution, means receipt in the office or branch office of the financial institution in which the account is established, but if the terms of the account require notice at a particular place, in the place required. (10) "Request" means a request for payment complying with all terms of the account, including special requirements concerning necessary signatures and regulations of the financial institution; but, for purposes of this subchapter if terms of the account condition payment on advance notice, a request for payment is treated as immediately effective and a notice of intent to withdraw is treated as a request for payment. (11) "Successors" means those person, other than creditors, who are entitled to property of a decedent under the decedent's will or otherwise. (12) "Sums on deposit" means the balance payable on an account, including interest and dividends earned, whether or not included in the current balance, and any deposit life insurance proceeds added to the account by reason of death of a party. (13) "Terms of the account" includes the deposit agreement and other terms and conditions, including the form, of the contract of deposit. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 54-56.

This subchapter does not apply to: (A) an account established for a partnership, joint venture, or other organization for a business purpose. (B) an account controlled by one or more persons as an agent or trustee for a corporation, unincorporated association, or charitable or civic organization, or (C) a fiduciary or trust account in which the relationship is established other than by the terms of the account. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 56.

(a) An account may be for a single party or multiple parties. A multiple-party account may be with or without a right of survivorship between the parties. Subject to section 131i(c), either a single-party account or a multiple-party account may have a POD designation, an agency designation, or both. (b) An account established before, on, or after the effective date of this subchapter, whether in the form prescribed in subsection (c) of this section or in any other form, is either a single-party account or a multiple-party account, with or without right of survivorship, and with or without a POD designation or an agency designation, within the meaning of this part, and is governed by this part. (c) A contract of deposit that contains provisions in substantially the following form establishes the type of account provided, and the account is governed by the provisions of this part applicable to an account of that type: UNIFORM SINGLE OR MULTIPLE-PARTY ACCOUNT FORM PARTIES (Name one or more parties): OWNERSHIP [Select one and initial]: SINGLE-PARTY ACCOUNT MULTIPLE-PARTY ACCOUNT Parties own account in proportion to net contributions unless there is clear and convincing evidence of a different intent. RIGHTS AT DEATH (Select one and initial): SINGLE-PARTY ACCOUNT At death of party, ownership passes as part of party's estate. SINGLE-PARTY ACCOUNT WITH POD (PAY ON DEATH) DESIGNATION (Name One or More Beneficiaries): At death of party, ownership passes to POD beneficiaries and is not part of party's estate. MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP At death of party, ownership passes to surviving parties. MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP AND POD (PAY ON DEATH) DESIGNATION (Name One or More Beneficiaries): At death of last surviving party, ownership passes to POD beneficiaries and is not part of last surviving party's estate. MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF SURVIVORSHIP At death of party, deceased party's ownership passes as part of deceased party's estate. AGENCY (POWER OF ATTORNEY) DESIGNATION Agents may make account transactions for parties but have no ownership or rights at death unless named as POD beneficiaries. (To Add Agency Designation To Account, Name One or More Agents): (Select One and Initial): AGENCY DESIGNATION SURVIVES DISABILITY OR INCAPACITY OF PARTIES AGENCY DESIGNATION TERMINATES ON DISABILITY OR INCAPACITY OF PARTIES (d) A contract of deposit that does not contain provisions in substantially the form provided in subsection (c) is governed by the provisions of this subchapter applicable to the type of account that most nearly conforms to the depositor's intent. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 56, 57.

(a) By a writing signed by all parties, the parties may designate as agent of all parties on an account a person other than a party. (b) Unless the terms of an agency designation provide that the authority of the agent terminates on disability or incapacity of a party, the agent's authority survives disability and incapacity. The agent may act for a disabled or incapacitated party until the authority of the agent is terminated. (c) Death of the sole party or last surviving party terminates the authority of an agent. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 57, 58.

The provisions of this subchapter concerning beneficial ownership as between parties or as between parties and beneficiaries apply only to controversies between those persons and their creditors and other successors, and do not apply to the right of those persons to payment as determined by the terms of the account. Part C of this subchapter governs the liability and set- off rights of financial institutions that make payments pursuant to it. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 58.

(a) In this section, "net contribution" of a party means the sum of all deposits to an account made by or for the party, less all payments from the account made to or for the party which have not been paid to or applied to the use of another party and a proportionate share of any charges deducted from the account, plus a proportionate share of any interest or dividends earned, whether or not included in the current balance. The term includes deposit life insurance proceeds added to the account by reason of death of the party whose net contribution is in question. (b) During the lifetime of all parties, an account belongs to the parties in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent. As between parties married to each other, in the absence of proof otherwise, the net contribution of each is presumed to be an equal amount. (c) A beneficiary in an account having a POD designation has no right to sums on deposit during the lifetime of any party. (d) An agent in an account with an agency designation has no beneficial right to sums on deposit. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 58.

(a) Except as otherwise provided in this part, on death of a party sums on deposit in a multiple-party account belong to the surviving party or parties. If two or more parties survive and one is the surviving spouse of the decedent, the amount to which the decedent, immediately before death, was beneficially entitled under section 131h belongs to the surviving spouse. If two or more parties survive and none is the surviving spouse of the decedent, the amount to which the decedent, immediately before death, was beneficially entitled under section 131h belongs to the surviving parties in equal shares, and augments the proportion to which each survivor, immediately before the decedent's death, was beneficially entitled under section 131h, and the right of survivorship continues between the surviving parties. (b) In an account with a POD designation: (1) On death of one of two or more parties, the rights in sums on deposit are governed by subsection (a). (2) On death of the sole party or the last survivor of two or more parties, sums on deposit belong to the surviving beneficiary or beneficiaries. If two or more beneficiaries survive, sums on deposit belong to them in equal and undivided shares, and there is no right of survivorship in the event of death of a beneficiary thereafter. If no beneficiary survives, sums on deposit belong to the estate of the last surviving party. (c) Sums on deposit in a single-party account without a POD designation, or in a multiple-party account that, by the terms of the account, is without right of survivorship, are not affected by death of a party, but the amount to which the decedent, immediately before death, was beneficially entitled under section 131h is transferred as part of the decedent's estate. A POD designation in a multiple-party account without right of survivorship is ineffective. For purposes of this section, designation of an account as a tenancy in common establishes that the account is without right of survivorship. (d) The ownership right of a surviving party or beneficiary, or of the decedent's estate, in sums on deposit is subject to requests for payment made by a party before the party's death, whether paid by the financial institution before or after death, or unpaid. The surviving party or beneficiary, or the decedent's estate, is liable to the payee of an unpaid request for payment. The liability is limited to a proportionate share of the amount transferred under this section, to the extent necessary to discharge the request for payment. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 58, 59.

(a) Rights at death of a party under section 131i are determined by the terms of the account at the death of the party. A party may alter the terms of the account by a notice signed by the party and given to the financial institution to change the terms of the account or to stop or vary payment under the terms of the account. To be effective the notice must be received by the financial institution during the party's lifetime. (b) A right of survivorship arising from the express terms of the account, section 131i or a POD designation may not be altered by will. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 59.

Except as provided in any law of the Virgin Islands governing augmented estates, or as a consequence of, and to the extent directed by, section 131 l, a transfer resulting from the application of section 131i is effective by reason of the terms of the account involved and this subchapter and is not testamentary or subject to the laws under this Code governing estate administration. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 59, 60.

(a) For the purpose of this section, a nonprobate transfer occurs if the last domicile of a depositor whose interest is transferred under section 131i was in the Virgin Islands. (b) A transferee of a nonprobate transfer is subject to liability to any probate estate of the decedent for allowed claims against that estate and statutory allowances to the decedent's spouse and children to the extent the estate is insufficient to satisfy those claims and allowances. The liability of a nonprobate transferee may not exceed the value of nonprobate transfers received by that transferee. (c) Nonprobate transferees are liable for the insufficiency described in subsection (b) in the following order of priority: (1) a transferee designated in the decedent's will or any other governing instrument, as provided in the instrument; (2) the trustee of a trust serving as the principal nonprobate instrument in the decedent's estate plan as shown by its designation as devisee of the decedent's residuary estate or by other facts or circumstances, to the extent of the value of the nonprobate transfer received; (3) other nonprobate transferees, in proportion to the values received. (d) A provision made in one instrument may direct the apportionment of the liability among the nonprobate transferees taking under that or any other governing instrument. If a provision in one instrument conflicts with a provision in another, the later one prevails. (e) Upon due notice to a nonprobate transferee, the liability imposed by this section is enforceable in proceedings in the Virgin islands, whether or not the transferee is located in the Virgin Islands. (f) A proceeding under this section may not be commenced unless the personal representative of the decedent's estate has received a written demand for the proceeding from the surviving spouse or a child, to the extent that statutory allowances are affected, or a creditor. If the personal representative declines or fails to commence a proceeding after demand, a person making demand may commence the proceeding in the name of the decedent's estate, at the expense of the person making the demand and not of the estate. A personal representative who declines in good faith to commence a requested proceeding incurs no personal liability for declining. (g) A proceeding under this section must be commenced within one year after the decedent's death, but a proceeding on behalf of a creditor whose claim was allowed after proceedings challenging disallowance of the claim may be commenced within 60 days after final allowance of the claim. (h) Unless a written notice asserting that a decedent's estate is insufficient to pay allowed claims and statutory allowances has been received from the decedent's personal representative, a trustee receiving a nonprobate transfer is released from liability under this section with respect to any assets distributed to the trust's beneficiaries. Each beneficiary to the extent of the distribution received becomes liable for the amount of the trustee's liability attributable to assets received by the beneficiary. (i) In this section: (1) "Child" includes any individual entitled to take as a child by intestate succession from the parent whose relationship is involved and excludes any person who is only a stepchild, a foster child, a grandchild, or any more remote descendant. (2) "Claims" in respect to the estate of a decedent, includes liabilities of the decedent whether arising in contract, tort or otherwise, and liabilities of the estate which arise at or after the death of the decedent, including funeral expenses and expenses of administration. The term does not include estate or inheritance taxes, or demands or disputes regarding title of a decedent to specific assets alleged to be included in the estate. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 60, 61.

(a) A deposit of community property in an account does not alter the community character of the property or community rights in the property, but a right of survivorship between parties married to each other arising from the express terms of the account or section 131i may not be altered by will. (b) This part does not affect the law governing tenancy by the entireties. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 61.

A financial institution may enter into a contract of deposit for a multiple-party account to the same extent it may enter into a contract of deposit for a single-party account, and may provide for a POD designation and an agency designation in either a single-party account or a multiple-party account. A financial institution need not inquire as to the source of a deposit to an account or as to the proposed application of a payment from an account. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 61.

A financial institution, on request, may pay sums on deposit in a multiple-party account to: (1) one or more of the parties, whether or not another party is disabled, incapacitated, or deceased when payment is requested and whether or not the party making the request survives another party; or (2) the personal representative, if any, or, if there is none, the heirs or devisees of a deceased party if proof of death is presented to the financial institution showing that the deceased party was the survivor of all other persons named on the account either as a party or beneficiary, unless the account is without right of survivorship under section 131i. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 62.

A financial institution, on request, may pay sums on deposit in an account with a POD designation to: (1) one or more of the parties, whether or not another party is disabled, incapacitated, or deceased when the payment is requested and whether or not a party survives another party; (2) the beneficiary or beneficiaries, if proof of death is presented to the financial institution showing that the beneficiary or beneficiaries survived all persons named as parties; or (3) the personal representative, if any, or, if there is none, the heirs or devisees of a deceased party, if proof of death is presented to the financial institution showing that the deceased party was the survivor of all other persons named on the account either as a party or beneficiary. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 62.

A financial institution, on request of an agent under an agency designation for an account, may pay to the agent sums on deposit in the account, whether or not a party is disabled, incapacitated, or deceased when the request is made or received, and whether or not the authority of the agent terminates on the disability or incapacity of a party. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 62.

If a financial institution is required or permitted to make payment pursuant to this part to a minor designated as a beneficiary, payment may be made pursuant to the Uniform Transfers to Minors Act. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 62.

(a) Payment made pursuant to this part in accordance with the terms of the account discharges the financial institution from all claims for amounts so paid, whether or not the payment is consistent with the beneficial ownership of the account as between parties, beneficiaries, or their successors. Payment may be made whether or not a party, beneficiary, or agent is disabled, incapacitated, or deceased when payment is requested, received, or made. (b) Protection under this section does not extend to payments made after a financial institution has received written notice from a party, or from the personal representative, surviving spouse, or heir or devisee of a deceased party, to the effect that payments in accordance with the terms of the account, including one having an agency designation, should not be permitted, and the financial institution has had a reasonable opportunity to act on it when the payment is made. Unless the notice is withdrawn by the person giving it, the successor of any deceased party must concur in a request for payment if the financial institution is to be protected under this section. Unless a financial institution has been served with process in an action or proceeding, no other notice or other information shown to have been available to the financial institution affects its right to protection under this section. (c) A financial institution that receives written notice pursuant to this section or otherwise has reason to believe that a dispute exists as to the rights of the parties may refuse, without liability, to make payments in accordance with the terms of the account. (d) Protection of a financial institution under this section does not affect the rights of parties in disputes between themselves or their successors concerning the beneficial ownership of sums on deposit in accounts or payments made from accounts. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 62, 63.

Without qualifying any other statutory right to set off or lien and subject to any contractual provision, if a party is indebted to a financial institution, the financial institution has a right to set-off against the account. The amount of the account subject to set-off is the proportion to which the party is, or immediately before death was, beneficially entitled under section 131h or, in the absence of proof of that portion, an equal share with all parties. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 63.

This subchapter must be applied and construed to effectuate its general purpose to make uniform the law with respect to the subject of this subchapter among jurisdictions enacting it. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 63.

Unless displaced by the particular provisions of this subchapter, the principles of law and equity supplement its provisions. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 63.

(1) An act done before the effective date and any accrued right is not impaired by this subchapter. If a right is acquired, extinguished, or barred on the expiration of a prescribed period of time that has commenced to run by the provisions of any statute before the effective date, the provisions remain in force with respect to that right. (2) Any rule of construction or presumption provided in this subchapter applies to accounts established before the effective date unless there is a clear indication of a contrary intent. (3) The rights of a party, beneficiary, or creditor in an account established before the effective date of this subchapter are governed by the law applicable before the effective date for a period of one year after the effective date and thereafter are governed by this subchapter. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 64.

If any provision of this subchapter or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this subchapter which can be given effect without the invalid provision or application, and to this end the provisions of this subchapter are severable. History: Added June 1, 2016, No. 7869, § 1, Sess. L. 2016, p. 64.

As used in this chapter, unless the text otherwise requires: (a) "Consumer funds transfer facility" means an automated teller machine, including any supporting equipment, structures, or systems; (b) (1) "Automated Teller Machine" means an unmanned, free-standing electronic information processing device that uses either the direct transmission of electronic impulses or the recording of electronic impulses or other indicia of a transaction for delayed transmission in order to perform financial transactions, or any other electronic device that, operating in conjunction with a processor and network, allows a consumer to debit an account in exchange for dispensing cash but does not mean a point of sale device. (2) "Nonbank automated teller machine" means an automated teller machine owned or operated by any person other than a bank or foreign bank. (c) "Financial transaction" means cash withdrawals, deposits, account transfers, payments from deposit, loan or thrift accounts, disbursements under a pre-authorized credit agreement, or loan payments and other similar transactions. (d) "Office" means the Office of the Lieutenant Governor, Division of Banking, Insurance and Financial Regulation. (e) "Network" means a person engaging primarily in the establishment and maintenance of a computer- operated system of transmitting items and messages between banks, processors and automated teller machines or similar electronic devices. (f) "Nonbank operator" means any person other than a bank or foreign bank that owns, leases, or otherwise legally controls an automated teller machine. (g) "Processor" means a person who electronically acquires financial data emanating from a nonbank automated teller machine and relays such data to a network. (h) "Servicing agent" means a person who contracts with a nonbank operator to provide consumer relations, financial record keeping or similar services in regard to an automated teller machine. History: Added Oct. 7, 1997, No. 6153, § 1, Sess. L. 1997, p. 51; amended Mar. 5, 2005, No. 6727, §§ 4(24), (25), Sess. L. 2005, pp. 27-28; amended Jan. 20, 2017, No. 7962, § 8(1), Sess. L. 2016, p. 311.

(a) Any bank or foreign bank operating or sharing the use of a consumer funds transfer facility may: (1) make the facilities available for use by account holders of banks, foreign banks or other financial service providers other than the institution owning the facility; (2) connect the facility with a regional or national consumer funds transfer system for the purpose of handling financial transactions; (3) impose a reasonable financial transaction fee for the use of an automated teller machine by persons other than those account holders of such banks or foreign bank, if the imposition of the fee is disclosed at a time and in a manner that allows the user to terminate or cancel the transaction without incurring the transaction fee. Ten percent (10%) of such fees shall be paid not less than quarterly by such bank, or foreign bank to the Commissioner of Finance for deposit within the Tourism Revolving Fund established pursuant to Title 33, Section 3072, Virgin Islands Code. This fee may be in addition to any other charges imposed by the operator of any consumer funds transfer system or by any other financial institution. (b) The fee provided in subsection (a), paragraph (3) of this section applies only to automated teller machines. (c) An agreement to share automated teller machines may not: (1) prohibit, limit, or otherwise restrict the right of a bank or foreign bank to charge a customer any fee allowed by territorial or federal law; (2) require a bank or foreign bank to limit or waive its rights or obligations under this chapter. (d) A nonbank operator may impose a reasonable financial transaction fee for use of an automated teller machine but only if the amount of the fee is clearly and conspicuously disclosed as follows: (1) on a sign posted on the automated teller machine or in clear view of a consumer viewing such machine; and (2) electronically during the course of the transaction in a manner that permits the consumer to cancel the transaction without incurring the fee. History: Added Oct. 7, 1997, No. 6153, § 1, Sess. L. 1997, p. 51; amended Mar. 5, 2005, No. 6727, §§ 4(26), (27), Sess. L. 2005, p. 28.

(a) No person other than a bank or foreign bank may establish or operate an automated teller machine except in accordance with the following provisions. (b) At least 30 days prior to the activation date of any nonbank automated teller machine, its nonbank operator shall provide to the Office: (1) a written notice that accurately sets forth the following information with regard to such machine: (i) the nonbank operator's name, address, and telephone number; (ii) the location, name and address of each machine; (iii) the activation date; (iv) a statement that the only service provided is the dispensing of cash; (v) the processor's name, address, and telephone number; (vi) the servicing agent's name, address, and telephone number; and date of last service; and (vii) the dated signature, name, title, address, and telephone number of the person completing the notice. (c) An annual fee of $150, shall be paid to the Government of the Virgin Islands, for each nonbank automated teller machine. (d) The nonbank operator, without being assessed a fee, shall promptly notify the Office in writing of any of the following: (1) any changes to the information required under subsection (b) as provided in the most current notice; and (2) any changes in the operation of the nonbank automated teller machine. (e) The Office may at any time verify the completeness and accuracy of any notice required under this subsection, and in connection therewith: (1) If the nonbank operator fails to promptly provide adequate documentation to and upon request of the Director, (A) the Office shall inform the nonbank operator of such failure and the consequences thereof; and (B) the nonbank operator's automated teller machine shall not be deemed in compliance for purposes of this chapter until the provisions of this section are fulfulled. (2) If the office determines that any information provided in the most current notice is incomplete or inaccurate, (A) The Office shall inform the nonbank operator of such discrepancy and the consequences thereof; and (B) The nonbank operator's automated teller machine may not be deemed in compliance for purposes of this chapter until the provisions of this section are fulfilled. (f) The nonbank operator of an automated teller machine who fails to completely and accurately abide by this section may not legally establish or operate such automatic teller machine until this section is fully complied with, except that a fee of $250, rather than $150, shall be paid. (g) In lieu of the nonbank operator, the automated teller machine's servicing agent may submit to the office any information, documentation, or fees required pursuant to this section. (h) Any nonbank operator shall clearly and conspicuously disclose on a sign posted an the nonbank automated teller machine or in clear view of a consumer viewing such machine: (1) The name of the nonbank operator; (2) A disclaimer indicating that the nonbank operator is not a bank or a credit union; and (3) The name, address, and 24-hour, toll-free telephone number where consumers may direct inquiries or complaints. (i) An operator who collects a fee for the use of a cash-dispensing machine shall, in addition to the amount paid to the Government of the Virgin Islands, remit ten percent of the amount collected to the Government of the Virgin Islands to be credited to the Tourism Advertising Revolving Fund. History: Added Mar. 5, 2005, No. 6727, § 4(28), Sess. L. 2005, p. 29.

History: Repealed. Jan. 23, 1990, No. 5497, § 1, Sess. L. 1990, p. 7.

(a) For purposes of this chapter: (1) "Advertisement" means a commercial message in any medium that promotes, directly or indirectly, a credit transaction; (2) "Balloon payment" means a loan in which the consumer is required to repay the entire amount of any outstanding balance as of a specified date or at the end of a specified period of time, as determined in accordance with the terms of the agreement pursuant to which such credit is extended and the aggregate amount of the minimum periodic payments required would not fully amortize such outstanding balance by such date or at the end of such period; (3) "Consumer" means a natural person to whom consumer credit is offered or extended; (4) "Consumer credit" means credit offered or extended to a consumer primarily for personal, family or household purposes; (5) "Creditor" means a person who regularly extends consumer credit that is subject to a finance charge or is payable by written agreement in more than four installments, not including the downpayment, and to whom the obligation is initially payable, either on the face of the note or contract, or by agreement when there is no note or contract. A person shall regularly extend credit only if it extends credit more than five times for transactions secured by a dwelling in the preceding calendar year. If a person did not meet the numerical standards in the preceding calendar year, the numerical standards shall be applied to the current calendar year; (6) "Dwelling" means a residential structure that contains one to four units, whether or not that structure is attached to real property. The term includes an individual condominium unit, cooperative unit, mobile home, and trailer, if used as a residence; (7) "Home equity loan" means any open end consumer credit plan in which a consensual security interest is created or retained against the consumer's dwelling; and (8) "Open end consumer credit plan" means consumer credit extended by a creditor under a plan in which the creditor reasonably contemplates repeated transactions; the creditor may impose a finance charge from time to time on an outstanding unpaid balance; and the amount of credit that may be extended to the consumer during the term of the plan (up to any limit set by the creditor) is generally made available to the extent that any outstanding balance is repaid. (b) Unless defined by this section, regulation of the Virgin Islands Banking Board or the context clearly requires otherwise, the words used in this chapter shall have the meanings given them by the Truth in Lending Act of the Consumer Protection Act (15 U.S.C.1601 et seq.) and regulations issued pursuant thereto. History: Added Feb. 13, 1992, No. 5769, § 1, Sess. L. 1992, p. 14.

(a) At the time that a consumer makes an initial application to a creditor for a home equity loan in person, or within three business days if the consumer applies by mail or telephone, the creditor shall provide the applicant with a disclosure in either of the following forms: (1) The statement: "THIS HOME EQUITY LOAN THAT YOU ARE APPLYING FOR WILL BE SECURED BY A MORTGAGE AGAINST YOUR HOME AND FAILURE TO REPAY THE LOAN FOR ANY REASON COULD CAUSE YOU TO LOSE YOUR HOME!" (2) A statement to the effect that a home equity loan is secured by a mortgage against the home of the consumer and in the event of any default the consumer risks the loss of the home. (b) The disclosure required in subsection (a) of this section shall be made by either of the following means: (1) A separate and specific document attached to or accompanying the application. (2) A clear and conspicuous statement on the application. (c) On every home equity loan in which there is a balloon payment, there shall be printed or clearly stamped on the mortgage or other instrument signed by the consumer by which the consumer grants a security interest against the consumer's dwelling a statement in substantially the following form: "THIS IS A BALLOON PAYMENT MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL BALANCE DUE UPON MATURITY MAY BE AS MUCH AS $____________________, IN ADDITION, ACCRUED INTEREST, IF ANY, AND ALL OTHER ADVANCES MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE WILL BE DUE AND PAYABLE UPON MATURITY." (d) A creditor of a home equity loan shall provide to the consumer all disclosures required by the Truth in Lending Act of the Consumer Credit Protection Act (15 U.S.C.1601 et seq.) and regulations issued pursuant thereto. (e) To the extent that the provisions of this section are inconsistent with respect to disclosure, advertisement, terminology, form, content or other requirements of the Truth in Lending Act of the Consumer Credit Protection Act (15 U.S.C.1601 et seq.) and regulations issued pursuant thereto, compliance with said federal law and regulations shall be deemed to be compliance with this section. History: Added Feb. 13, 1992, No. 5769, § 1, Sess. L. 1992, p. 14.

(a) No fee, penalty or other form of payment may be charged a consumer for prepayment of all or part of the balance of a home equity loan. (b) No advertisement for a home equity loan may refer to such loan as "free money" or use any other term determined by the Banking Board to be misleading. History: Added Feb. 13, 1992, No. 5769, § 1, Sess. L. 1992, p. 14.

Any person who violates the provisions of section 142 and 143 of this chapter shall upon conviction be subject to a fine of not more than $1,000. History: Added Feb. 13, 1992, No. 5769, § 1, Sess. L. 1992, p. 14.

(a) If, in consequence of an examination or report made by an examiner, or otherwise, the Banking Board should have reason to believe that a bank or foreign bank is not in sound financial condition to continue doing business, or that its affairs are being conducted in such a manner that the public or the persons or entities having securities or funds under its custody are in danger of being defrauded, or if any such bank shall violate its charter or any law relative thereto, or if it becomes insolvent, the Banking Board shall apply to the District Court for the appointment of a receiver to take charge of and wind up the affairs of such bank. (b) If the court, after hearing all parties concerned, determines that the facts alleged by the Banking Board are supported by the evidence, it shall appoint a receiver. Upon his appointment the receiver shall, under the direction of the Banking Board, take possession of the assets and liabilities, books, records, papers and files of every description belonging to the bank, and collect all loans, fees, and claims of the bank, and see to the payment of its obligations and debts, and to the necessary expenses of receivership. He shall proceed to liquidate the affairs of the bank as soon as possible, and to this end may sell the personal and real property and other assets of the bank, but subject to the approval of the Banking Board. The receiver shall continue to perform his duties in the manner aforesaid until the bank or foreign bank is fully liquidated. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Liability of Directors If the directors of any bank or foreign bank knowingly violate or knowingly permit any of the officers, agents or employees of the bank or foreign bank doing business in the United States Virgin Islands to violate any of the provisions of sections 5, 38, 39, and 101 of this title, the license of the bank shall be cancelled by the Lieutenant Governor if the Banking Board orders such cancellation, and the Board may declare such bank in liquidation. Such violation, however, shall be determined and adjudged by the District Court in a suit brought for that purpose by the Attorney General of the United States Virgin Islands at the instance and in the name of the Banking Board before the license may be cancelled and the association may be declared dissolved. In the event of such violation, every director who participated in or assented to the same shall be held liable in his personal and individual capacity for all damages which the bank, its shareholders or any other person shall have sustained in consequence of such violation. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Causes for dissolution (a) Banks shall be dissolved because of the expiration of the term fixed for their duration, or because one- third or more of the capital of the corporation has been lost, or by resolution of the holders of two-thirds of the capital stock, adopted at a meeting specially called for that purpose as herein provided. Notice to Banking Board; publication of notice to creditors (b) Whenever it is decided to place a bank in liquidation it shall be the duty of the Board of Directors to cause the fact to be certified by its president, manager, agent or cashier to the Banking Board, and to cause the daily publication of a notice, for a period of two months, in a newspaper published in the judicial division in which the bank is located, if there is any such newspaper, said notice to be to the effect that the bank is in liquidation and notifying its creditors to present to the bank their claims for payment. Powers during liquidation (c) During the period of liquidation of a bank, the directors thereof shall make no new contracts or obligations unless authorized to do so by the Banking Board, their powers being limited, as liquidators, to the collection of debts, extinguishment of obligations as they mature, and performance of such operations as may then be pending. Inventory; balance (d) Within thirty days after the beginning of the period of liquidation of a bank, the liquidators thereof shall take an inventory of the assets and liabilities, and shall strike a balance, a copy of which shall be sent by mail to the Banking Board and to each stockholder, and shall submit the same to a general meeting of stockholders for their examination. Bond and compensation of liquidators (e) Before entering into the discharge of their duties as such, the liquidators shall furnish such bond as may be fixed by the Banking Board, and the stockholders shall fix the compensation to be paid to the said liquidators for their services. Monthly balances; publication (f) The liquidators shall make a monthly balance of the condition of the liquidation, and the last of said balances shall be published every six months in a newspaper of general circulation in each judicial division of the United States Virgin Islands. Liability of liquidators (g) Said liquidators shall be answerable to the stockholders for any loss that the bank may suffer through fraud or negligence in the discharge of their duties. Dividends (h) As soon as the condition of the liquidation shall permit of the declaration of one or more partial dividends of 10 percent of the capital of the bank, the liquidators shall make the apportionment and payment thereof to the stockholders. The final dividend may be less than 10 percent. Rights of stockholders (i) Stockholders shall have the right to demand from the liquidators any information of interest to them as to the liquidation and pending operations of the bank; but they may not demand a distribution of the capital of the bank until all the obligations thereof shall have been satisfied, or the amount of the said obligations has been provided for in a manner satisfactory to the Banking Board, if the same cannot be paid in cash. Meetings of stockholders (j) During the term of liquidation of a bank, the provisions of its bylaws shall be observed as regards calling regular and special general meetings of stockholders for the purpose of reporting the progress of the liquidation and taking such action as may be deemed best for the interest of all concerned. Books and papers (k) The books and papers of a bank in liquidation shall remain under the custody of the liquidators until the full liquidation and settlement with each and every person interested in any way in the assets thereof has been made, after which they shall be finally filed as the Banking Board may direct. Foreign banks excepted (l) This section shall not apply to foreign banks. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The following words and phrases as used in this subchapter shall have the meanings indicated unless a contrary meaning shall appear in the context: "person" means any individual, firm, voluntary association, joint-stock company, incorporated society, partnership, trust, corporation or any other legal entity; "licensee" means a person to whom one or more licenses have been issued under this subchapter; "license" means the authority to do business issued by the Banking Board under the provisions of this subchapter; "fiscal year" means the twelve-month period ending June 30. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) No person shall, without first obtaining a license from the Banking Board as hereinafter provided, engage in the business of making loans in amounts of $7,500 or less and contract for, exact or receive, directly or indirectly, in connection with any such loan any charges, whether for interest, compensation, brokerage, endorsement fees, consideration, expense or otherwise, which in the aggregate are greater than otherwise authorized by law. (b) This subchapter shall not apply to any person lawfully engaged in business as permitted by the laws of this territory or of the United States relative to banks, trust companies, insurance companies, savings or building and loan associations, credit unions or pawnbrokers or to loans made by them, nor shall this subchapter apply to any person engaged solely in the business of making loans for educational purposes or to the loans made by such persons. (c) Any person not exempt under subsection (b) of this section, and the several members, officers, directors, agents and employees thereof who shall wilfully violate or participate in the violations of any provisions of subsection (a) of this section shall be guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of not more than $500. Any contract of loan in the making or collection of which any act shall have been done which violates subsection (a) of this section shall be void and the lender shall have no right to collect, receive or retain any principal, interest or charges whatsoever. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 1, Sess. L. 1983, p. 59; Oct. 14, 1986, No. 5206, § 116, Sess. L. 1986, p. 243; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135; July 22, 1994, No. 6000, § 4, Sess. L. 1994, p. 133.

(a) A licensee may lend any sum of money, goods, or things of value not exceeding in amount or value $9,500, excluding interest charges, upon such security not forbidden by section 187 of this title as may be agreed upon, under a contract which permits the combined total of the principal and interest charges to be paid in substantially equal and consecutive monthly installments except for the first installment which may be larger than each of the remaining installments by the amount of the charge required to extend the first installment due-date beyond one month from the date of the loan. Licensees may charge, contract for and receive interest charges at a maximum annual percentage rate computed on the unpaid balance of the amount financed of 26 percent per annum, but not less than 19.50 percent per annum based on the following formula; the maximum annual percentage interest rate shall be determined quarterly by adding 13 points on the prime interest rate prevailing fifteen (15) days prior to the first day of the months of January, April, July and October of each year. The prime interest rate shall be the lower of the rates charged by the Chase Manhattan Bank, N.A., and CitiBank, N.A., as published in the Wall Street Journal; and such rate shall be announced quarterly by the Lieutenant Governor of the Virgin Islands. At no time shall the maximum annual percentage rate of interest determined under this method be lower than 19.50 percent per annum, or not more than 26 percent per annum, but shall be what the actual annual percentage rate of interest is based on the preceding formula at the time of the signing of the loan. The original principal amount as used in this section shall be the same as the amount financed as defined by the Federal Truth in Lending Act and Regulation Z of the Board of Governors of the Federal Reserve System. Licensees may charge, contract for, and receive interest charges at a maximum annual percentage rate computed on the unpaid balance of the amount financed of 26 percent per annum and not less than 19.50 percent per annum. The annual percentage rate of interest charges which may be contracted for and received under any loan contract made by a licensee under this chapter may equal, but not exceed, the annual percentage rate which must be computed and disclosed as required by the Federal Truth in Lending Act and Regulation Z of the Board of Governors of the Federal Reserve System. The maximum annual percentage rate of finance charges which may be contracted for and received is 12 times the maximum monthly rate, and the maximum monthly rate shall be computed on the basis of one twelfth of the annual rate for each full month. The Lieutenant Governor shall, by regulation, establish the rate of each day in a fraction of a month when the period for which the charge is computed is more or less than one (1) month. In addition to the interest and insurance charges no further charges or amounts for any examinations, service, commission or other purposes shall be directly charged, contracted for; or received as a condition of granting the loan except as provided for under section 190 of this chapter. At the time of the signing of loans, licensees shall advise consumers that credit life insurance and credit accident and health insurance are optional and not required as a condition of receiving the loan. Any such insurance provided by the finance company shall be taken at the sole discretion of the consumer. (b) No licensee shall, with the intent to circumvent the provisions of this chapter, originate a loan or loans to any person that will obligate the person to the licensee on one or more contracts of loan, the total principal balance of which is more than $9,500. Nothing provided herein shall preclude any licensee or any affiliate of a licensee from acquiring by purchase, negotiation, or otherwise, loans from any person which, when originated, did not obligate the person to the originator of the loan or loans in an aggregate principal balance in excess of $9,500 provided that if, subsequent to acquisition, any person becomes obligated to any licensee in an total principal amount in excess of $9,500, only one such loan may thereafter be renewed. (c) No licensee shall induce or permit any borrower to split up or divide any loan. No licensee shall induce or permit any person to become obligated to him, directly or contingently, or both, under more than one contract of loan at the same time, for the purpose or with the result of obtaining a higher rate of charge than would otherwise be permitted by this section. (d) For the purpose of applying subsections (b) and (c) of this section only, licensee shall mean any single licensee, except that in the event any person or affiliated group of persons holds more than one license in the territory, such person or affiliated group of persons shall be considered a single licensee. (e) If the contract so provides, a licensee may charge and collect an additional charge for either default or deferment. When one-half or more of an installment remains unpaid ten or more successive calendar days from the due date, it shall be in default. The additional charge for default may be collected at the time of default or at any time thereafter. The charge for default shall be five cents per dollar for each dollar of the regular contract payment. If a borrower desires to defer the scheduled contract payment and the lender agrees, it will have the effect of extending the contract for an additional month. The assessment charge for a deferred payment will be two percent of the actual existing or ledger card balance of the account. This charge will be collected only once for each deferment. (f) In computing charges a month shall be that period of time from any date in a month to the corresponding date in the next month but if there is no such corresponding date then to the last day of such next month and a day shall be considered one-thirtieth of a month when computation is made for a fraction of a month. (g) A licensee and borrower may agree that the first installment period may exceed one month by fifteen days or less and the charge for each day exceeding one month shall be one-thirtieth of the applicable charge which would be earned for a first installment period of one month under the rebate computation provided by this section. The charge for extra days in the first installment period may be added to the first installment. Such charge and the extra days shall be excluded from the computation of the rebate required by this section. (h) If charges in excess of those permitted by this subchapter shall be charged, contracted for or received except as a result of an accidental or bona fide error the licensee shall have no right to collect or receive any interest or other charges provided in this section. History: Added Mar. 29, 1968, No. 2127, § 1, Sess L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, §§ 1, 2(a)-(i), Sess. L. 1983, p. 59; Oct. 14, 1986, No. 5206, § 116, Sess. L. 1986, p. 243; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135; July 22, 1994, No. 6000, §§ 1, 4, Sess. L. 1994, pp. 131, 133; Jan. 10, 2003, No. 6571, § 18, Sess. L. 2002, p. 598; June 18, 2008, No. 7006, § 1(a), (b), Sess. L. 2008, p. 151; Oct. 7, 2011, No. 7307, § 7 (1.)(a.), (b.), (2.)(a), (b.), Sess. L. 2011, p. 217; amended Dec. 31, 2014, No. 7727, § 1(a)-(d), Sess. L. 2014, p. 414.

Any loan contract subject to the provisions of this subchapter shall have an originally scheduled final installment date not later than 48 months, fifteen days from the date of the loan. Notwithstanding any other provisions of this subchapter the charges which may be collected on any loan made under this subchapter for the period beginning six months after the originally scheduled or as deferred final installment date of the loan and ending with date of payment of the loan in full shall not exceed 2 percent per month simple interest on the balances outstanding from time to time during said period. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 3(a)-(c), Sess. L. 1983, p. 60; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135.

(a) Every licensee shall- (1) mail or deliver to the borrower, or if more than one, to one of them, at the time of making a loan under this subchapter, a statement making the disclosures and furnishing the information required by the federal Truth-in-Lending Act with respect to thLending Actact of loan. (2) give to the person making any cash payment on account of any loan a receipt at the time such payment is made. The use of a coupon book system shall be deemed in compliance with this provision. (3) permit payment in advance in amount equal to one or more full installments at any time during the regular business hours of the licensee. (4) upon repayment of a loan in full, mark plainly every note or other evidence of the indebtedness or assignment signed by an obligor with the words "PAID IN FULL" or "CANCELLED" and release or provide the borrower evidence to release any mortgage or security instrument no longer securing any indebtedness to the licensee. (b) No licensee shall take any confession of judgment or any power of attorney running to himself or to any third person to confess judgment or to appear for the borrower in a judicial proceeding; nor take any note or promise to pay which does not disclose the date and amount of the note, a schedule or description of the payments to be made thereon, and the agreed charges or rate of charge; nor take any instrument in which blanks are left to be filled in after the loan is made. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 4, Sess. L. 1983, p. 60.

If a borrower desires to renew an existing loan for the purpose of obtaining additional cash a new contract shall be drawn up in its entirety and the prior loan shall be paid in full from the proceeds of the new loan. All legal papers in connection with the previous loan shall be stamped "PAID IN FULL" and returned to the customer. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No licensee shall be permitted to accept real estate as collateral on a loan under this subchapter. No licensee shall enforce a lien on any item of household furniture in use except on order of a court after a finding that continued possession and use of the item by the borrower is not necessary to avoid undue hardship on the borrower or his family. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 5, Sess. L. 1983, p. 60.

Any loan made outside this territory in conformity to the law of the place where made which would have been subject to the provisions of this subchapter had it been made in this territory after July 1, 1968, may be collected in this territory by a licensee or others, but the charges thereon which may be collected shall not exceed those permitted by this subchapter. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A licensee may conduct a business of making loans under this subchapter within any office, suite, room or place of business in which any other business is solicited or engaged in, or in association or conjunction with any other business, unless the Banking Board shall find, after a hearing, that the conduct of such other business by the licensee or other person in the particular licensed office has concealed evasion of this subchapter and shall order such licensee, in writing, to desist from such conduct in such office. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No charge for any examination, service, brokerage, commission, or other thing, or otherwise, shall be directly or indirectly made or contracted for, except as provided for in this subchapter and except for the following: (1) Taxes and fees prescribed by law that actually are or will be paid to public officials for determining the existence of, and for perfecting, releasing, or satisfying a security interest; (2) The premium for insurance in lieu of perfecting a security interest to the extent that the premium does not exceed the fees described in paragraph (1) of this section that otherwise would be payable; which charges may be collected when the loan is made, or at any time thereafter. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 6, Sess. L. 1983, p. 60.

(a) Credit life insurance and credit accident and health insurance may be issued in connection with a loan or other credit transaction authorized by this subchapter in compliance with the provisions of Title 22, Virgin Islands Code, and the cost of such insurance and any commission, benefit or return to the licensee therefrom shall not be deemed a violation of any provision of this chapter; provided, however, that if there is more than one borrower or obligor on any such loan or credit transaction, such insurance may be issued on only one borrower or obligor. (b) Tangible personalty. The licensee may require a borrower to insure tangible personal property given to secure the loan against any substantial risk of loss, damage, or destruction for an amount not to exceed the reasonable value of the property insured or the amount of the loan, whichever is less, and for the customary insurance term approximating the term of the loan. The borrower shall not be required to insure against unusual or exceptional risks not ordinarily insured against in policies issued to nonborrowers. The premium for such insurance may be included in the principal amount of the loan. Such insurance shall be written by or through a duly licensed insurance agent or broker with a company qualified to do business in the United States Virgin Islands. Such insurance shall name the borrower as insured but may include the licensee as coinsured or protect the interest of the licensee under a loss-payable clause. No licensee shall require a borrower to duplicate or cancel existing insurance or to purchase insurance from a licensee or any employee, affiliate or associate of the licensee or from any agent, broker or insurance company designated by the licensee, as a condition precedent to the making of the loan. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Application for a license shall be in writing, under penalty of perjury, and in the form prescribed by the Banking Board. The application shall give the location where the business is to be conducted, and shall include the names and addresses of the partners, officers, directors, or trustees of the applicant. At the time of making such application, the applicant shall pay to the Banking Board the sum of $400 as an annual license fee provided that if the application is made after October first in any year the license fee shall be $200. Moneys received from payment of fees under this subchapter shall be covered into the general fund of the Treasury. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Nov. 7, 1983, No. 4877, § 310(d)(3), Sess. L. 1983, p. 240.

Upon the filing of such application and the payment of such fees, the Banking Board shall send a notice of the pending application to all licensees in the community in which the applicant proposes to do business and shall investigate the facts concerning the application. Every licensee so notified shall have ten days after the date of notification to file a notice of objection to the granting of such application. Within ten days thereafter the objecting licensee shall file a statement, supporting his objection. Failure to file such statement within such period of time shall be deemed withdrawal of such objection. If the Banking Board shall find: (1) that the financial responsibility, experience, character and general fitness of the applicant are such as to command the confidence of the public and to warrant the belief that the business will be operated lawfully, honestly and fairly within the purposes of this subchapter; and (2) that the applicant has available for use in such business at the location specified in the application at least $25,000, or, in the case of the licensee, has such amount available or actually invested in loans made under this subchapter; and (3) that allowing the applicant to engage in business will promote the convenience and advantage of the community in which the business of the applicant is to be conducted which may include as a factor reduced interest rates, the Board shall enter an order approving such application and deliver a license to the applicant. If the Banking Board shall not so find, it shall enter an order denying such application and forthwith notify the applicant of the denial, returning the license fee. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

History: Repealed. May 25, 1983, No. 4811, § 7, Sess. L. 1983, p. 61.

The applicant shall also, at the same time, file with the Banking Board a surety company bond to the territory, in the sum of $7,500, to be approved by the Banking Board, for the use of the territory and of any person who may have a cause of action against the principal in said bond under the provisions of this subchapter and conditioned that he will conform to and abide by each provision of this subchapter and will pay to the territory and to any such person any sum that may become due or owing to the territory or to such person from said principal under and by virtue of the provisions hereof. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended July 22, 1994, No. 6000, § 4, Sess. L. 1994, p. 133.

No person, partnership, or corporation shall make any loan of money, credit, goods, or things of value in the amount or to the value of $7,500 or less whether secured or unsecured, and charge, contract for, or receive a greater rate of interest than otherwise authorized by law therefor without holding a license from the Banking Board. Each such license shall terminate on the first day of April next following its issue. Each license shall remain in full force and effect until surrendered, revoked, suspended or terminated. Each such license shall state the name and address of the licensee and shall be posted in the licensee's place of business. No license shall be transferable or assignable. Before the corporate or trade name under which the license business is conducted is changed the licensee shall give notice to the Banking Board who shall amend the license accordingly without cost unless, in the opinion of the Banking Board, the proposed change of name conflicts or might conflict with any existing registered name of any licensee. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 1, Sess. L. 1983, p. 59; Oct. 14, 1986, No. 5206, § 116, Sess. L. 1986, p. 243; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135; July 22, 1994, No. 6000, § 4, Sess. L. 1994, p. 133.

No licensee shall make any loan or transact any business provided for by this subchapter under any other name, or at or from any other place of business than stated in the license, except, that nothing shall prevent the making of loans, otherwise authorized under this subchapter, by mail or prohibit accommodations to individual borrowers necessitated by sickness or emergency. Not more than one place of business for the making of loans pursuant to this subchapter shall be maintained under the same license, but the Banking Board may issue additional licenses to the same licensee under compliance with all the provisions of this subchapter covering issuance of a single license. No change in the location of a licensed business shall take place to a location outside the city or town specified in the license without the written approval of the Banking Board. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) If the Banking Board has reason to believe that grounds for suspension of a license exist it may suspend such license and shall send written notice to the licensee of such suspension stating in general, the grounds therefor and setting a date for hearing thereon. Such suspension shall not exceed a period of twenty days pending the holding of a hearing. At the conclusion of such hearing, the Banking Board shall issue a written order either: (1) terminating the suspension; (2) suspending the license for a period of not more than sixty days which period shall include the temporary suspension; or (3) revoking the license. The grounds for revocation or suspension shall be that the licensee, knowingly, has violated any provision of this subchapter. (b) Any licensee may surrender any license by delivering it to the Banking Board with written notice of a surrender, but such surrender shall not affect civil or criminal liability for acts committed prior thereto. (c) No revocation, suspension or surrender of any license shall impair or affect the obligation of any preexisting lawful contract between the licensee and any obligors, and such contracts and all lawful charges thereon may be collected by the licensee, its successors and assigns. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) The Banking Board or its duly authorized representative may at any time and shall periodically investigate the business and examine the books, accounts, papers and records of each licensee pertaining to the business of making loans of $7,500 or less; provided, however, the investigation carried out under the provisions of this section by the Banking Board shall also examine and determine if the interest rate charged to consumers is commensurate with the provisions of section 183 of this chapter and the Banking Board shall report annually to the Lieutenant Governor and the Legislature of the United States Virgin Islands regarding the results of the investigation. (b) The Banking Board or its duly authorized representative may investigate at any time any person engaged in the business or participating in such business as principal, agent, broker, or otherwise; or any person who the Board has reasonable cause to believe is violating or is about to violate any provision of this subchapter, whether such person shall claim to be within the authority or beyond the scope of this subchapter. Any person not exempt hereunder who shall advertise for, solicit or hold himself out as willing to make or procure loans in the amount of, or of the value of, $7,500 or less shall be presumed to be engaged in the business described in section 182(a) of this title. (c) For the purpose of this section, the Banking Board or its duly authorized representative shall have and be given free access to the office and places of business, files, safes and vaults of all such persons, and shall have authority to require the attendance of any person and to examine him under oath relative to such loans or such business or to the subject matter of any examination, investigation or hearing, and shall have authority to require the production of books, accounts, papers and records of such persons. (d) Whenever the Banking Board has reasonable cause to believe that any person is engaging in the business described in section 182(a) of this title without obtaining a license as provided herein, it may in addition to all actions provided for in this subchapter and without prejudice thereto, enter an order requiring such person to desist or to refrain from such violation; and an action may be brought by the Board to enjoin such person from engaging in or continuing such violation or from doing any act or acts in furtherance thereof. In any such action, an order or judgment may be entered awarding such preliminary or final injunction as may be deemed proper. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 1, Sess. L. 1983, p. 59; Oct. 14, 1986, No. 5206, § 116, Sess. L. 1986, p. 243; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135; July 22, 1994, No. 6000, §§ 2, 4, Sess. L. 1994, p. 133.

(a) Each licensee shall keep and use in his business such books and accounting records as are in accord with sound and accepted accounting practice and enable the Banking Board to determine whether the licensee is complying with this subchapter. The licensee's system of records shall be accepted provided it discloses the information required under this section. (b) Every licensee shall at least once a year have its books audited by a certified public accountant registered in the United States Virgin Islands and a copy of such audit duly certified by the accountant shall be filed with the Banking Board, which audit, so certified, shall be accepted by the Board in lieu of an audit made by it. (c) Each licensee shall, on or before the first day of September of each year, file with the Board a report of operations of the licensed business for the preceding fiscal year. Such report shall give information with respect to the financial condition of the licensee and shall include balance sheets at the beginning and end of the year; statement of income and expenses for the period; reconciliation of surplus or net worth with the balance sheets; schedule of assets used and useful in the licensed business; classification of loans made by size and security; an analysis of charges including monthly average number and amount of loans outstanding; analysis of delinquent accounts, and court actions undertaken to effect collection. Such report shall be made under the penalties of perjury and shall be in the form prescribed by the Board which shall annually make and publish an analysis and recapitulation of such reports. In the event any person or affiliated group of persons holds more than one license in the state, they may file a composite annual report, in lieu of separate reports for each licensed office provided a short form of report for each licensed place of business shall be included showing the number and amount of loans made during the year and number and amount of loans outstanding at the beginning and end of the year. Any licensee failing to make the report required by this paragraph within the time prescribed shall pay to the Board the sum of $5 for each day said report is overdue. If a licensee elects to file a composite report and such composite report is not filed on or before September first as herein required the penalty herein prescribed shall apply separately for each license held. Penalties collected hereunder shall be covered into the general fund of the Treasury. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No licensee or other person, shall advertise, print, display, publish, distribute, or broadcast or cause or permit to be advertised, printed, displayed, published, distributed, or broadcast, in any manner whatsoever any statement or representation with regard to the rates, terms, or conditions for the lending of money, credit, goods, or things in action in the amount of or of the value of $7,500 or less, which is false, misleading or deceptive. The Banking Board may order any licensee to desist from any conduct which it shall find to be a violation of the foregoing provisions. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended May 25, 1983, No. 4811, § 1, Sess. L. 1983, p. 59; Oct. 14, 1986, No. 5206, § 116, Sess. L. 1986, p. 243; May 27, 1988, No. 5339, § 2, Sess. L. 1988, p. 135; July 22, 1994, No. 6000, § 4, Sess. L. 1994, p. 133.

This subchapter, or any part thereof may be modified, amended or repealed so as to effect a cancellation or alteration of any license, or right of a licensee hereunder, provided that such modification, amendment or repeal shall not impair or affect the obligation of any preexisting lawful contracts between any licensee and any borrowers. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any person and the several members, officers, directors, agents and employees thereof who, knowingly, shall violate any provision of this subchapter, shall, upon conviction thereof, be punished by a fine of not less than $100 and not more than $500. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

In addition to any other available remedy, any person considering himself aggrieved by any act or omission of the Banking Board may, within thirty days from the date of such act, or failure to act, bring an action in the Superior Court of the Virgin Islands to review such act, or failure to act. The hearing before the court shall be based on the record before the Banking Board and its findings and on such new evidence as may be introduced. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended June 18, 2008, No. 7006, § 2, Sess. L. 2008, p. 152.

If any person shall engage in business as a pawnbroker he shall, for any article or thing of value received in pawn or otherwise for the security of any loan, transfer, service, undertaking or advantage, give to the pledgor, or person for whom or for whose benefit the transaction is made or done, a ticket or coupon stating the name and address of such pawnbroker, the property, security or thing received in pawn and the amount loaned thereupon. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No person shall receive in pawn, or as security for any loan, transfer, service, undertaking or advantage, anything of value from any minor or person in a visible state of intoxication from liquors or otherwise, or any article of clothing removed from the person at the place of business of the pawnbroker. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whoever violates any provision of sections 221 and 222 of this title shall be fined not more than $20 or imprisoned not more than thirty days. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The Lieutenant Governor shall license suitable persons to carry on the business of pawnbrokers in any city or town for one year, and may revoke such licenses, in his discretion, after a hearing on charges preferred. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The fee for such license or renewal thereof shall be fixed by the Lieutenant Governor and shall be paid to the city or town in which the license is to be in force. No person in any city or town shall be required to pay a larger fee for said license than is required from any other person in the same city or town for a similar license. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The Lieutenant Governor may from time to time establish regulations relative to the business carried on by pawnbrokers. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Articles deposited in pawn with a licensed pawnbroker shall, unless redeemed, be retained by him, on the premises occupied by him for his business, for at least four months after the date of deposit, if not of a perishable nature; and, if of a perishable nature, for at least one month after said date. Articles of personal apparel shall not be deemed to be of a perishable nature. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

After the expiration of said time he may sell the same by public auction. Notice of such sale shall be given by posting notice thereof in two or more public places in the town where the property is situate, fourteen days before the sale, notice of the sale shall also be given to the general owner, at such time stating in writing the time and place of sale. The balance of the proceeds of sale, if any, after payment of the amount owing and reasonable expenses, shall be paid to the general owner on demand. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

If less than $25 has been loaned on any article so taken in pawn the requirement of notice, and of sale by public auction, may be waived by agreement of the parties, made in writing. In other cases the requirement cannot be waived. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The Lieutenant Governor may fix the rate of interest which such pawnbrokers may receive on loans, and may fix different rates which may be received for different amounts of money lent; and no licensed pawnbroker shall charge or receive a greater rate of interest than that so fixed. The rates of interest so established shall be printed on the loan ticket issued by the pawnbroker. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) Every such pawnbroker shall keep a book in which, at the time of making a loan, shall be legibly written in the English language an account and description of the goods, articles or things pawned or pledged, the amount of money loaned thereon, the time of pledging them, the rate of interest to be paid on such loan and the name and residence of the pledgor. (b) In addition to the requirements contained in subsection (a) the transaction must be recorded on forms obtainable from the Virgin Islands Police Department which must include: (1) The date and time of the transaction; (2) A comprehensive description of the item transacted, including any visible identification marks, such as initials, name of manufacturer, model and serial numbers and owner-applied identification numbers or marks; (3) The estimated fair market value of the item transacted; and (4) The name, address, and date of birth of the person from whom the item is received, including proof of identification of the person by a driver's license, passport, resident alien identification or similar credentials. (c) The requirements imposed on a pawnbroker by this section are also binding upon any employee of the pawnbroker or any person acting on the pawnbroker's behalf. (d) The completed form must be transmitted by the pawnbroker to the Virgin Islands Police Department no later than 5 days after the date of the transaction listed on the form. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Oct. 15, 2010, No. 7204, § 1(1), Sess. L. 2010, pp. 205, 206.

(a) For purposes of this subchapter: (1) "Pawnbroker" means any person, corporation, partnership or other business entity conducting business in the Virgin Islands which acquires from a consumer through purchase, barter, or any form of transfer in exchange for money, trade, barter or other valuable consideration precious metals or precious stones as defined in title 27 Vtitle 27 Virgin Islands Code, chapter 9,309ion 9ections (c) and (d), watches, porcelain or any other item of any kind, except that those established merchants in fixed locations are excluded when the purchase is made directly from manufacturers or wholesalers. (2) "Consumer" means any person who obtains from a pawnbroker money or any form of consideration in exchange for an item. (b) (1) Any pawnbroker who accepts or exchanges or deals in any manner with precious metals or precious stones as defined in title 27 Vtitle 27 Virgin Islands Code, chapter 9,309ion 9ections (c) and (d), watches, porcelain or any item of any kind shall install video recording devices in the person's place of business, and all transactions must be video recorded showing the face of the consumer and the date and time of the transaction and must be kept for not less than 90 days after the recording is made. (2) Any pawnbroker who violates paragraph (1) is subject to forfeiture of his business license and is subject to a fine of twice the value of the item transacted. History: Added Oct. 15, 2010, No. 7204, § 1(2), Sess. L. 2010, p. 206.

(a) The Lieutenant Governor or his authorized representative may at any time enter upon any premises used by a licensed pawnbroker for the purposes of his business, ascertain how he conducts his business and examine all articles taken in pawn or kept or stored in or upon said premises and all books and inventories relating thereto. Every such pawnbroker, his clerk, agent, servant or other person in charge of the premises shall exhibit to such person on demand any or all of such articles, books and inventories. The book must be kept for inspection for at least five years from the time of the transaction. (b) Pawnbrokers shall have a fixed place of business with an address and a telephone number, and any business conducted in the following designated locations below is prohibited: (1) Within any guestroom, guest unit of a hotel, motel, tourist home or tourist camp; (2) In or about any vehicle parked within an automobile parking compound, automobile parking lot, or parked elsewhere on any lot, parcel, track of land, or public highway, street or sidewalk; or (3) On or about any public highway, street or sidewalk. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Oct. 15, 2010, No. 7204, § 1(3), Sess. L. 2010, p. 207.

Whoever, not being licensed, carries on such business or is concerned therein within such city or town; or, being licensed, carries on such business or is concerned therein in any other place or manner than that designated in his license or after notice to him that his license has been revoked; or who wilfully hinders, obstructs or prevents any person from entering the premises or from making the examination authorized in the preceding section; or who otherwise violates any provision of this subchapter, shall be fined not more than $50, or imprisoned not more than sixty days, or both. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whenever used in this chapter the following words shall have the meaning set opposite them below: "consumer goods" means goods bought for use primarily for personal, family, or household purposes, as distinguished from goods bought for commercial, industrial, or business use, and does not include motor vehicles, accessories, equipment, parts, or repairs. "credit" means any loan, residential mortgage, deed of trust, advance, or discount; any conditional sales contract; any contract to sell, or sale, or contract of sale of property or services, either for present or future delivery, under which part or all of the price is payable subsequent to the making of such sale or contract; any rental-purchase contract; any contract or arrangement for the hire, bailment, or leasing of property; any option, demand, lien, pledge, or other claim against, or for the delivery of, property or money; any purchase, discount, or other acquisition of, or any credit upon the security of, any obligation or claim arising out of any of the foregoing; and any transaction or series of transactions having a similar purpose or effect. "finance charges" includes charges such as interest, fees, service charges, discounts, and other charges associated with the extension of credit. "person" means any individual, partnership, association, corporation, or unincorporated organization. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any person engaged in the business of extending credit shall furnish to each person to whom such credit is extended, concurrently with the consummation of the transaction or agreement to extend credit, a clear statement in writing setting forth the finance charges, expressed in dollars, rate of interest, or monthly rate of charge, or a combination thereof, to be borne by such person in connection with such extension of credit as originally scheduled. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Where a buyer makes any subsequent purchases of consumer goods from a seller from whom he has previously purchased goods or services under one or more conditional sales contracts, and the amounts under the contract or contracts have not been fully paid, the subsequent purchases may be included in and consolidated with one or more of the prior contract or contracts. A memorandum of the additional purchases shall be prepared by the seller, inserted in or attached to the seller's counterpart of the contract and shall set forth: (1) a description of the additional goods or services so purchased; (2) the consolidated total indebtedness of the buyer; (3) the finance charge stating either as the additional amount on the subsequent purchase or as the total amount on the consolidated contract; (4) the revised installment payments. A copy of the memorandum shall be furnished to the buyer. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Prior to or after any action by the seller or his agents to repossess consumer goods under the terms of any such conditional sales contract or contracts involving both previous and subsequent purchases which have not been fully paid, the seller must retroactively allocate all payments received under the contract or contracts to the various purchases in the same proportion or ratio as the original cash prices of the various purchases bear to one another. However, the amount of initial or down payment involved in each purchase shall be allocated in its entirety to such purchase. The results of such allocation shall be reported to the buyer who has the right to complete payment on any of the purchases consolidated in the conditional sales contract within fifteen days from receipt of the allocation report from the seller. Any purchases upon which the payments have been so completed are exempt from repossession by the seller. Provisions of this section do not apply to sales involving equipment, parts, or other merchandise attached or affixed to goods previously purchased or repairs or services rendered by the seller in connection therewith at the buyer's request. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Conditional sales contracts do not include any instrument creating or involving liens against real estate or any interest in real estate. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

No person shall extend credit in contravention of this chapter. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) Any person engaged in the business of extending credit shall post in a conspicuous public place a list of all fees and charges for credit and other financial transactions, including but not limited to application processing fees, interest on first priority mortgage loans, loans for consumer goods, automobile loans, and, if appropriate to the person's business, savings and checking account fees, interest on checking and savings accounts and certificates of deposit, and fees for money orders, savings and checking accounts. (b) At least once each year, all banks shall mail to all customers any changes in their respective fees, interest or service charges, and shall make such information available upon request by any person. History: Amended July 11, 1983, No. 4849, § 4, Sess. L. 1983, p. 122; Nov. 28, 1987, No. 5289, § 3, Sess. L. 1987, p. 151; Jan. 23, 1990, No. 5497, § 2, Sess. L. 1990, p. 7; Mar. 5, 2005, No. 6727, § 4(29), Sess. L. 2005, p. 31.

Any person who wilfully violates any provision of this chapter shall be fined not more than $500 or imprisoned not more than sixty days, or both. History: Amended July 11, 1983, No. 4849, § 4, Sess. L. 1983, p. 122.

As used in this chapter "credit union" means a cooperative, non-profit association organized in accordance with the Federal Credit Union Act of 1934, as amended. History: Added Jan. 20, 2017, No. 7960, § 1, Sess. L. 2016, p. 299.

All credit unions doing business in the Virgin Islands must be federally-chartered and regulated by the National Credit Union Administration. The shares of members of credit unions must be insured by the National Credit Union Shares Insurance Fund. History: Added Jan. 20, 2017, No. 7960, § 1, Sess. L. 2016, p. 299.

Fifteen or more persons of age, residents of this territory, may form an association as provided in this subchapter. Associations formed under the provisions of this subchapter shall be known as cooperative savings and loan associations, and the name of every association so formed shall contain as a part thereof the words "savings and loan association" or "building and loan association." History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Associations may become members of the Federal Home Loan Bank system, may subscribe for and invest in stock of the Federal Home Loan Bank, and may secure insurance of its thrift accounts and creditor liabilities from the Federal Savings and Loan Insurance Corporation, and may insure their mortgages through such federal agency or agencies as may be available. They may borrow money from any source to meet withdrawals or extraordinary demands, to make real estate loans to their members or for other corporate purposes and may pledge its securities for such loans, but the aggregate amount of the outstanding indebtedness shall not at any time exceed 25 percent of the outstanding assets of an association not a member of the Federal Home Loan Bank and not to exceed 50 percent of the assets of an association which is a member of the Federal Home Loan Bank and the Federal Savings and Loan Insurance Corporation. A real estate loan shall be deemed to include a loan on unimproved real estate. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Oct. 19, 1984, No. 5014, § 224(c), Sess. L. 1984, p. 371.

In the absence of a demand for loans or in the regular course of business, accumulations of funds may be invested as follows: (1) cash on hand; (2) deposit in any bank or trust company incorporated under the laws of this territory or national banking association having its principal place of business in this territory and in the Federal Home Loan Bank; (3) in any financial institution doing business in any of the states of the United States when such deposits are insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation; (4) obligations of the United States, whether direct or indirect; (5) an amount not to exceed 10 percent of the assets of an association in bonds and notes of any of the states of the United States or in the securities issued by the Federal Home Loan Bank system; (6) on vote of two-thirds of the directors such accumulation may also be invested in notes of other associations incorporated under the provisions of this subchapter, with first mortgages as collateral, provided such loans shall not exceed two-thirds of the value of the mortgages taken as collateral, and not more than 10 percent of the assets of any association shall be loaned to another association; (7) an association may purchase and maintain real estate for its use and occupancy in the transaction of its business when authorized so to do by a two-thirds vote of its board of directors and a two-thirds vote of its shareholders voting at a meeting of the shareholders duly warned for that purpose, the cost of the same not to exceed 6 percent of its share accounts. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Such association may purchase real estate at a public or private sale, upon which it has a mortgage, judgment, lien or other encumbrance, or in which it has an interest, and may sell, convey, lease or mortgage the same at pleasure to any person. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Incorporation of such an association shall be accomplished in the following manner: (1) fifteen or more persons shall make and sign a certificate stating the name of such association, the fact that the association is formed under and for the purposes prescribed in this subchapter, the town or city where the association is located; (2) such certificate shall be filed in the office of the Lieutenant Governor, who shall issue his certificate, declaring the facts contained in such original certificate, and the filing and recording thereof in his office; (3) such certificate shall thereupon be filed with the Banking Board. Thereupon, the persons named in the original certificate, their associates and successors shall become a corporate body. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any person, corporation, partnership, association, agent, guardian, executor, administrator or trustee may become a member of such association by opening an account therein, subscribing to the bylaws, and annexing to his signature his post-office address. Whenever he desires his post-office address changed, he shall give written notice thereof to the secretary of the association. For the purpose of giving a member notice by mail, the last post-office address given by him shall be deemed the proper one. A minor may hold an account in an association in his own name and the account with its redemption value shall not be subject to the control of his parent, guardian or trustee and a receipt of acquittance signed by a minor, who is an account holder, shall be a valid and sufficient release and discharge of an association for any payment of an account, or delivery of rights, to such minor. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Every person who shall receive a loan from any such association pursuant to this subchapter shall thereby become a member thereof and shall be entitled to one vote at all meetings of the members thereof, whether he be a shareholder or not. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The officers of such association shall consist of a president, vice-president, treasurer and secretary, who shall be ex officio members of the board of directors, which shall consist of not less than five members, exclusive of such ex officio members. Other officers may be authorized by the bylaws. The secretary and at least two-thirds of the directors of an association shall be residents of this territory and a vacancy in the board of directors or in any office of an association shall be filled by the remaining members of the board. The duties, compensation, term of office, time of election of officers, and the time of periodical meetings of the officers and shareholders shall be determined by the bylaws; except that the board of directors shall annually determine the compensation of the secretary and treasurer. Special meetings of the officers and shareholders shall be called and held as provided by the bylaws. Each shareholder, not in arrears for dues, shall be entitled to one vote at all meetings of the shareholders, for each share owned by him or held by him as trustee, but not to exceed fifty votes for any one account. All borrowers are deemed to be members and shall have at least one vote. All officers shall hold office until their successors are duly elected and assume the duties of the office. An association shall not expire from neglect on its part to elect officers at the time prescribed by the bylaws. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Such association may adopt bylaws, not inconsistent with the provisions of this subchapter, regulating the conduct of the business of the association, defining the duties of officers and committees, times of meeting, mode of determining and declaring the withdrawing values of shares, and in relation to all other matters having reference to the conduct of the business, although not specifically mentioned in this subchapter. The board of directors may appoint and remove at pleasure an attorney for the association. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

(a) The capital of such association shall consist of the accumulated savings of its members which it holds, and shall be unlimited. (b) The shares shall be issued in annual, semiannual or quarterly series, in such amounts in each series and at such times as shall be determined by the board of directors. Shares of prior series may be issued after the issuing of shares in a new series. (c) The capital shall be divided into shares of the matured value of $200, $300 and $400 each. (d) Prepaid shares may be issued as subscribed upon the payment by the subscriber of a lump sum and such shares shall be permitted to stand until the dividends declared and credited thereon pay the same up to their matured value. (e) Full paid income shares may be issued as subscribed upon payment in full of the matured value thereof by the subscriber, dividends to be paid thereon at rates determined from time to time by the board of directors. (f) Savings shares may be issued and savings share accounts maintained in connection therewith, with the approval of the directors. A passbook shall be issued to the holder of a savings share account and the association may accept payments, to be held by the association in such accounts, subject, however, to withdrawals therefrom by the holder from time to time. Each $200 of the balance from time to time in any such account shall represent one savings share. There shall be credited to each savings share account of $5 or more at every distribution date, dividends at rates determined from time to time by the directors. (g) Shares which have not been pledged as collateral security for the repayment of a loan shall be called unpledged shares. Shares that have been so pledged shall be called pledged shares. (h) A person shall not hold shares of a matured value in excess of $25,000. (i) Shares of a matured value of $300 and $400 shall be available to borrowing members only. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Transfers of shares shall not be binding upon the association until the same have been made upon its books. The transferee thereof shall take the same charged with all the liabilities and conditions attaching thereto in the hands of the transferor. The association may require a transfer fee of not exceeding 25 cents a share. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

All accumulations upon shares in such association held by any person shall be exempt from attachment, levy and garnishment, to the amount of $1,000. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The board of directors in its discretion and under rules made by it may retire the unpledged shares of any class at any time after four years from the date of their issue, by enforcing withdrawals of the same. However, the shareholders whose shares are to be retired shall be determined by lot, and they shall be paid the full value of their shares, less all fines and proportionate part of unadjusted loss, and shares pledged for share loans shall be treated as unpledged shares. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When each unpledged share of a given series, other than a full paid share reaches the value of $200, $300 or $400, all payment of dues thereon shall cease and the holder thereof shall be paid therefor out of the funds of the association, with such rate of dividend as shall be determined from time to time by the board of directors for the period of time the board shall declare such share to have matured until paid; but at no time shall more than a third of the receipts of the association be applicable to the payment of matured shares, without the consent of the board of directors. The order of payment of the matured shares shall be determined by the board of directors. Before paying matured shares all arrears and fines shall be deducted therefrom. Holders of such matured shares shall remain shareholders until the same are paid, and shall not become creditors. They may remain in the association and shall be treated in all respects as holders of full paid shares. Such matured shares may be exchanged for full paid income shares. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Savings paid to such association upon shares shall be called dues. At or before each stated monthly or semimonthly meeting of the board of directors each shareholder shall pay to such board, or a committee thereof, $1 dues upon each share held by him until the share reaches the value of $200, $300 or $400, or is withdrawn, canceled or forfeited. Payment of dues on shares of each series shall commence from their issue. The association may impose and collect a fine, not exceeding 2 percent for each month in arrears, for every dollar of dues or interest which a shareholder shall refuse or neglect to pay at the time it is due. No fine shall accrue in excess of six months arrearages. An entrance fee not exceeding 25 cents per share may be charged. Withdrawal fees may be charged in accordance with the bylaws. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whenever a member shall be six months in arrears in the payments of his dues upon unpledged shares, the secretary shall give him notice thereof in writing and a statement of his arrearages, by mailing the same to him at the last post-office address given by him to the association. If he shall not pay the same at the next or second stated monthly meeting thereafter, the board of directors, at its option, may declare his shares suspended and, at the time of such suspension, the withdrawal value thereof shall be determined and stated, and the defaulting member shall be entitled to withdraw the same without dividend within one year, upon such notice as shall be required of a withdrawing shareholder, or such shares may be transferred to a prepaid share account or a savings share account. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The accumulations upon unpledged shares may be withdrawn and the shares canceled. One month's written notice of such intention may be required to be filed with the secretary at or before a stated monthly meeting of the board of directors. If filed before such meeting, the one month's notice shall not be deemed to have commenced until the first regular meeting after such filing. The withdrawing shareholder shall be paid the amount of the withdrawal value of his accumulations as determined under the by-laws, at the last distribution of profits before the notice of withdrawal, together with all dues paid since such distribution, less any fines unpaid and a proportionate share of any unadjusted loss. However, at no time shall more than half the receipts of the association, and when the association is indebted upon matured shares, not more than a third, shall be applicable to the payment of withdrawing shareholders, without the consent of the board of directors. When the demands of withdrawing shareholders exceed the moneys applicable to their payment, they shall be paid in the order in which their notices of withdrawal were filed with the secretary. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Loans shall be made only with the approval of the board of directors, or a committee appointed by the board of directors as provided by the bylaws. Loans shall be made in sums of $200 or a multiple or fractional part thereof. No loan shall be made in excess of $25,000 on any one piece of property. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A borrowing member for each share or fractional part thereof borrowed upon, in addition to the dues on his shares, in case such member is a shareholder borrowing on the sinking fund plan, shall pay monthly interest on his loan at such rate not exceeding 6 percent per annum as the directors shall name, until the shares borrowed upon reach the matured value of $200, $300 or $400 each, or the loan is repaid. When such matured value is reached, the share shall cancel the loan upon it and the proper surrenders and acquittances be made. A borrowing member, in case such member is not a shareholder but is borrowing on the direct reduction plan, shall pay monthly interest on the balance of principal outstanding on his loan at such rate, not exceeding 6 percent per annum, as the directors shall name, until the loan is repaid. When the loan is repaid, the proper surrenders and acquittances shall be made. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A first mortgage upon real estate shall be given for every loan. If the loan is of a sinking fund type, it shall be accompanied by a transfer and pledge to the association of the shares borrowed upon, and all accumulations that have accrued or shall accrue thereon, as collateral security for the repayment of the loan. In lieu of the mortgage, the borrower or another may transfer and pledge to the association unpledged shares for the payment of the loan, the withdrawal value of which under the bylaws, at the time of such borrowing, shall exceed the amount borrowed and interest thereon for six months. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any cooperative savings and loan association or any building and loan association organized and existing under the laws of this territory, shall have the power to make loans upon the security of first mortgages on real estate, without the requirement that shares of such association be pledged as additional security for such loans. Such loans shall be repayable in monthly installments, beginning not later than sixty days after the date of the advance of the loan, sufficient to retire the debt, interest and principal, within twenty-five years; provided that in case of construction loans the first payment shall not be later than four months after the date of the first advance. The monthly payments shall be applied first to interest on the debt and the remainder to the reduction of the debt until the same is paid in full. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Such association may require that the equivalent of one-twelfth of the estimated annual taxes, assessments, insurance premiums, and other charges upon real estate security, or any of them, be paid in advance to the association in addition to interest and principal payments on its loan so as to enable the association to pay such charges as they become due from the funds so received. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A mortgage securing a loan made by an association may contain conditions providing for the payment of insurance, taxes, assessments, levies, maintenance and repairs on the mortgaged property and the assignment to it of rents of the mortgaged property and other conditions required by the association for its security and protection and that any money paid by the association incident thereto may be added to the unpaid balance of the loan and that such payments shall be secured by the mortgage. An association may take an assignment of a life insurance policy issued on the life of the borrower or others as additional security on a real estate loan and may pay premiums thereon for its protection, and any premiums so paid may be added to the amount of the principal debt and become secured by the mortgage. An association may also take as additional security on a real estate loan, securities guaranteed by an agency of the United States Government or other securities listed on a national securities exchange as defined in the Federal Securities Exchange Act up to 75 percent of the market value of such securities. In such case not less than 80 percent of the loan shall be secured by a first mortgage on real estate. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The board of directors shall from time to time determine the rate of interest, fees and other charges to be made in connection with loans by the association. In fixing such charges full consideration shall be given to sound and economical home financing. Borrowers shall have the right to pay their loans before maturity, and in such cases, not more than ninety days' interest on the amount prepaid may be charged. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

If the borrower neglects to offer security satisfactory to the board of directors within the time provided by the bylaws, his right to the loan shall be forfeited, and he may be charged with one month's interest, and all necessary expenses incurred, if any, in investigating and preparing the mortgage and note for his proposed loan. All mortgages given to the association shall be deemed conditional upon the performance of the provisions of this subchapter relating to the repayment of loans and interest thereon, and the bylaws of the association, although the same may not be fully expressed therein. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A borrower may repay a loan and all arrears of interest and fines thereon, or one share thereof, at any stated monthly meeting, or at any other time; but when not made at a stated meeting, he shall pay interest up to the first monthly meeting after such payment. He may repay his loan in full, thereby relieving his shares from liability upon the pledge thereof made to the association, or by partial payments in sums of $50, or multiple thereof, and the same shall be endorsed upon his note, or, by a proper notice and direction as to its application, he may have the withdrawal value of any share freed from pledge by part or full payment applied in payment or part payment of his loan. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When a borrowing member shall be three months in arrears in the payment of his dues and interest or either, or in the payment of his specified monthly installments in the case of a direct reduction loan, the whole loan shall become due at the option of the board of directors; and it may proceed to enforce collection upon the securities held by the association. At the time such option is exercised, the withdrawal value of all shares pledged as collateral security for the loan shall be applied upon the loan and arrearages of interest and fines thereon, and the shares deemed surrendered to the association. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Every association may set up and maintain the reserves authorized by this subchapter. On the semiannual closing dates after the payment of or provision for all expenses, each association shall, before the declaration of a dividend for the semiannual period, transfer to a separate reserve account, which shall be set up and maintained for the sole purpose of absorbing losses, an amount equal to 5 percent of its net earnings, until such reserve equals 10 percent of its capital, such account being in the nature of a guaranty fund. If and whenever the guaranty fund is not equal to 10 percent of its capital, semiannual credits as above provided shall again be made to the guaranty fund until it shall again be made equal to 10 percent of its capital. The board of directors may make additional transfers to other reserve accounts. In no event shall dividends be declared and be paid out of capital. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Profits and losses shall be distributed at least semiannually, and always before issuing a new series of stock to the shares then outstanding. Profits and losses shall be distributed to all shares, in all series outstanding at the time of such distribution, in proportion to their holding value, as distinguished from their withdrawing value, except that in addition thereto distribution of not exceeding the amount of the entrance fee, if any, in the discretion of the board of directors, may be made to each share outstanding in the last series issued prior to the distribution. Nothing contained in this subchapter shall prevent a board of directors from declaring uniform dividends upon shares other than installment shares, at a rate less than the rate currently declared on installment shares. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

On each semiannual closing day after payment or provision for all expenses and appropriate transfers to reserves, the remainder of net earnings for the semiannual period shall be credited to an undivided profits account. At each semiannual period, the board of directors shall declare a distribution of earnings. Interim dividends may be declared by the board of directors for the purpose of bringing to maturity, between semiannual periods, shares of the earliest issue of series outstanding. Payments of net earnings to shareholders are dividends and shall not be referred to as interest. No association shall be required to pay or to credit dividends on accounts of $5 or less. Dividends shall be declared on the participating value of each account at the beginning of the dividend period, plus payments thereon made during the dividend period less amounts withdrawn and noticed for withdrawal which, for dividend purposes, shall be deducted from the latest previous payments thereon, computed at the dividend rate for the time invested. Dividends on full paid income shares and savings shares may be paid or credited as follows: (1) for any period from date of receipt of payment to repurchase or withdrawal of same, or (2) from the first day of the month of payment to the last day of that month on payments made not later than the tenth calendar day of the month. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

An association organized under the provisions of this subchapter shall annually make a full report in writing of the affairs and condition of such association on June 30 to the Banking Board in such form and by such officers of the association as it may designate. Such report shall be verified by the oath of the officer making the same. An association shall make such further report as the Banking Board may require, and in such form, as and to such matters relating to the condition and conducting of the business of the association, as it may designate. Any wilful false swearing in making and verifying such report shall be deemed perjury. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

If such an association fails to furnish the Banking Board a report required by this subchapter at the time so required and without cause for such failure, it shall forfeit the sum of $10 a day for every day such report is delayed or withheld. In its name, the Banking Board may maintain an action of tort of this statute to recover such penalty, and the same shall be covered into the Treasury of the United States Virgin Islands. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

An association organized under the provisions of this subchapter shall be subject to the visitation and examination of the Banking Board, or its duly appointed agent, at all times or upon the application of three or more members of such association. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any association organized or doing business under and by virtue of this subchapter may convert itself into a Federal Savings and Loan Association in accordance with the provisions of section 5 of the Home Owners' Loan Act of 1933, of the Congress of the United States, as now or hereafter amended, upon an affirmative vote of 51 percent or more of the outstanding shares of such association cast at an annual meeting or at a special meeting of such association called to consider such action. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When such vote is had by the members of a such a such association, the directors of such association shall proceed to take the necessary action to procure a Federal Savings and Loan Association charter and, upon receipt of such charter and compliance with the rules and regulations required by the Federal Home Loan Bank Board in perfecting an association under a federal charter, the directors of the federal association shall notify in writing the directors of the such association that it is organized and authorized to transact business. The directors of the such association shall record such notice in the records of its proceedings and name the date that the rights and obligations set forth in section 316 of this title will be transferred to the management and control of the federal association. Upon the acceptance of such rights and obligations by the federal association it shall file with the directors of the such association its acceptance of such rights and obligations set forth in section 316 of this title and no further step shall be necessary in effecting such conversion. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Upon the conversion of any association into a Federal Savings and Loan Association, the corporate existence of such association shall not terminate, but such federal association shall be deemed to be a continuation of the entity of the association so converted and all property of the converted association, including its right, title and interest in and to all property of whatsoever kind, whether real, personal or mixed, and things in action and every right, privilege, interest and asset of any conceivable value, or benefit, then existing or pertaining to it, or, which would inure to it, shall immediately by act of law and without any conveyance or transfer and without any further act or deed, remain and be vested in and continue and be the property of such federal association into which the territorial association has converted itself. Such federal association shall have, hold and enjoy the same in its own right as fully and to the same extent as the same was possessed, held and enjoyed by the converting association, and such federal association as of the time of the taking effect of such conversion shall continue to have and succeed to all of the rights, obligations and relations of the converting association. All pending actions and other judicial proceedings to which the converting territorial association is a party shall not be deemed to have abated or to have discontinued by reason of such conversion, but may be prosecuted to final judgment, order or decree in the same manner as if such conversion into such federal association had not been made and such federal association resulting from such conversion may continue such action in its corporate name as a federal association, and any judgment, order or decree may be rendered for or against it, which might have been rendered for or against the converting association theretofore involved in such judicial proceedings. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Any Federal Savings and Loan Association may convert itself into a territorial chartered association under this subchapter upon a vote of 51 percent or more of the votes of the members of such Federal Savings and Loan Association cast at an annual meeting or at a special meeting of such association called to consider such action. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When such vote is had by the members of a Federal Savings and Loan Association, the directors of such association shall proceed to take the necessary action to procure a charter for a territorial association and, upon receipt of charter for a territorial association and compliance with the rules and regulations required by its charter and the laws of this territory in perfecting an association under a territorial charter and securing the consent of the Banking Board to convert into a territorial association, the directors of the territorial association shall notify in writing the directors of the federal association that it is organized and authorized to transact business. The directors of such federal association shall record such notice in the records of its proceedings and name the date that the rights and obligations set forth in section 319 of this title will be transferred to the management and control of the territorial association. Upon the acceptance of such rights and obligations by the territorial association it shall file with the directors of the federal association its acceptance of such rights and obligations set forth in section 319 of this title and no further steps shall be necessary in perfecting such conversion. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Upon the conversion of a federal association into a territorial Savings and Loan Association the corporate existence of such federal association shall not terminate but such territorial association shall be deemed to be a continuation of the entity of the federal association so converted, and all property of the converted association, including its right, title and interest in and to all property of whatsoever kind, whether real, personal or mixed, and things in action and every right, privilege, interest, value or benefit then existing or pertaining to it, or which would inure to it, shall immediately by act of law and without any conveyance or transfer and without any further act or deed remain and be vested in and continue to be the property of the territorial association into which the federal association has converted itself. Such territorial association shall have, hold and enjoy the same in its own right as fully and to the same extent as same was possessed, held and enjoyed by the converting association, and such territorial association as of the time of the taking effect of such conversion shall continue to have and succeed to all of the rights, obligations and relations of the converting association. All pending actions and judicial proceedings to which the converting association is a party shall not be deemed to have abated or to have discontinued by reason of such conversion but may be prosecuted to final judgment, order or decree in the same manner as if such conversion into such territorial association had not been made and such territorial association resulting from such conversion may continue such action in its corporate name as a territorial association, and any judgment, order or decree may be rendered for or against it, which might have been rendered for or against the converting association in any judicial proceedings. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

At a meeting duly called for such purpose, on such notice as its bylaws provide and by vote of its members taken in accordance with the provisions of section 288 of this title, a cooperative savings, building and loan association organized and existing under the laws and doing business in this territory may proceed to dissolve and liquidate its affairs. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Income and Receipts Within ten days after such vote a copy thereof, certified by the president and secretary of such association, shall be filed with the Banking Board and Lieutenant Governor. After such filing, such association shall issue no stock and shall not loan or advance any money to members or other persons. All income and receipts of such association after such vote, in excess of the actual expense of management, shall be applied to the payment of indebtedness, and any balance thereof shall be added to the surplus and undivided profits for distribution pro rata in accordance with the plan adopted hereunder. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

With the approval of the Banking Board, the board of directors of such association may adopt such rules and regulations and make such orders as shall be just and equitable for the sale and distribution of all property and assets of such association, and for the division and application of the profits and surplus. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Upon the filing of the notice aforesaid, the Banking Board shall make such investigation as it deems necessary of the affairs and solvency of such association, and if it is satisfied that such association is entitled to dissolve and liquidate its affairs and with the method proposed therefor, the Board shall so certify to the president of such association. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When the dissolution and liquidation of such association has been effected, the secretary thereof shall file with the Lieutenant Governor and the Banking Board a certificate under oath that such dissolution has been completed and that shareholders and parties interested have been paid, in accordance with the plan approved by the Banking Board. Thereafter the existence of such association shall terminate. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

If it appears to the Banking Board, from the report of such association, or from an examination made by it, or its duly appointed agents, that such an association is violating the provisions of this subchapter, or is conducting its business in an unsafe or unauthorized manner, the Board shall, by an order under its hand and seal addressed to such association, direct the discontinuance of such illegal and unsafe practices. Whenever such association neglects or refuses to comply with such order, or make reports as required, the Banking Board shall communicate such facts to the attorney general, who thereupon shall investigate the cause of such complaint and if he finds sufficient cause, he shall institute proceedings against such association as are provided by law in the case of an insolvent corporation, or such other proceedings as the nature of the case may require. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A foreign building and loan association shall not do business in this territory until it has complied with the provisions of sections 342 - 347 of this title and received a license from the Banking Board. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

A certified copy of the charter, constitution and bylaws of such association showing its manner of doing business shall be filed with the Banking Board and Lieutenant Governor. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Such association, in writing, shall appoint the Lieutenant Governor its true and lawful attorney upon whom service of legal process in any action or proceeding against it may be made with the same force and validity as if made upon such association. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Semiannually, on or before February 1 and August 1, such association shall file with the Banking Board a statement signed and sworn to by its president and secretary, or by three directors, showing its business standing and financial condition on the last day of December and June preceding. Such statement shall show that it possesses actual paid in, unimpaired and well invested assets of at least $300,000, and a fully paid up cash guaranty fund of $25,000. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

For the purpose of paying the expense of filing papers and compensation for making examinations, as provided in this subchapter, such association shall annually pay to the Banking Board the following fees for the use of the territory: for the first $100,000 or less of assets, $100; and for each additional $100,000 of assets, or the major portion thereof, $10 additional; and shall also pay to the Banking Board actual necessary expenses while engaged in making such examinations. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289; amended Nov. 7, 1983, No. 4877, § 310(d)(4), Sess. L. 1983, p. 240.

(a) Such association shall deposit with the Commissioner of Finance first mortgage securities to the amount of $25,000, approved by the Banking Board. Such deposit shall be held in trust by the Commissioner of Finance for the protection and indemnity of the residents of this territory with whom such association has or may transact business. (b) All interest, premiums and dues which may accrue on the mortgages held by the Commissioner of Finance as provided in subsection (a) of this section may be collected and retained by the association depositing the same so long as such association remains solvent and faithfully performs all contracts with its members. When a mortgage is fully paid to such association, it may be surrendered to it, after such association has deposited with the Commissioner of Finance other first mortgage securities approved by the Banking Board, to the amount of those withdrawn. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Such association shall file with the Lieutenant Governor a bond to the territory in such sum as he may require, not more than $10,000 nor less than $500, with such sureties or securities as he approves, conditioned for the making of reports and returns required by this subchapter and the payment of all taxes assessed against it and in all cases to comply with the laws of this territory. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The Banking Board shall file all papers required by this subchapter, and thoroughly examine the annual reports submitted by foreign building and loan associations. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

After examination, if the Banking Board becomes satisfied that a foreign building and loan association desiring to do business in this territory is solvent and conducts its business according to law, and has complied with the provisions of this subchapter, it may issue a license to such association until January 1 following. If such association is found insolvent, or is being illegally conducted, the Banking Board shall refuse to issue such license. In case of such refusal to an association that has complied with the provisions of this subchapter, such association may appeal to the District Court. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

The Banking Board or its agent shall annually make an examination of the securities, records, books and accounts of every foreign building and loan association doing business in this territory and file a report of such examination in its office. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

If it appears to the Banking Board that a foreign building and loan association licensed to do business in this territory has violated a provision of its charter, or is conducting its business in an unsafe or unauthorized manner, by an order addressed to such association, the Board shall direct a discontinuance of such illegal and unsafe practices. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

Whenever it appears to the Banking Board that it is unsafe or inexpedient for such association to continue doing business in this territory, it may suspend the license granted to such association, and apply to the District Court for an injunction restraining such association from doing business in this territory. Such court shall have power to grant or refuse such injunction according to the usual procedure in equity, after reasonable notice to such association of such proceedings. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

When, by the laws of state or nation, any prohibitions, taxes, fines, penalties, licenses, fees, deposits of money, securities or other obligations are imposed upon building and loan associations of this territory, or upon their agents, doing business in such other state or nation, the same prohibitions and obligations shall be imposed on building and loan associations of such other state or nation, and upon their agents doing business in this territory, so long as such laws continue in force. History: Added Mar. 29, 1968, No. 2127, § 1, Sess. L. 1968, Pt. I, p. 289.

For the purposes of this chapter, the term: (1) "Banking Board" means the Banking Board of the United States Virgin Islands as established by title 3 Virgin Islands Code, section 42. (2) "Borrower" means a person who submits an application for a loan secured by a first or subordinate mortgage or deed of trust on a single to four-family home to be occupied by the borrower as the borrower's primary residence. (3) "Commitment" means a written, specific, binding agreement between a borrower and a lender, which sets forth the terms of the loan being extended to the borrower. (4) "Federally approved seller-servicers" means a mortgage lender that has been approved as a seller- servicer by: (A) The Federal Home Loan Mortgage Corporation; (B) The Federal National Mortgage Association; or (C) The Government National Mortgage Association. (5) "Financing agreement" means a written agreement between a borrower and a lender which sets forth the terms of a purchase money loan or a refinancing of an existing loan that: (A) results in or is secured by a first or subordinate mortgage or deed of trust on a single to four- family home to be occupied by the borrower, and (B) is offered or extended to the borrower. (6) "Interest in real property" includes: (A) A confessed judgment note or consent judgment required or obtained by any person acting as a mortgage lender or mortgage broker for the purpose of acquiring a lien on residential real property; (B) A sale and leaseback required or obtained by any person acting as a mortgage lender or mortgage broker for the purpose of creating a lien on residential real property; (C) A mortgage, deed of trust, or lien other than a judgment lien, on residential real property; and (D) Any other security interest that has the effect of creating a lien on residential real property in the Virgin Islands. (7) "License" means a license issued by the Banking Board under this chapter to authorize a person to engage in business as a mortgage lender or mortgage broker. (8) "Licensee" means a person who is licensed as a mortgage lender or mortgage broker under this chapter. (9) "Loan application" means the submission of a borrower's financial information in anticipation of a credit decision, whether written or computer-generated, relating to a mortgage loan. If the submission does not state or identify a specific property, the submission is an application for a pre-qualification and not an application for a mortgage loan. The subsequent addition of an identified property to the submission converts the submission to an application for a mortgage loan. (10) "Mortgage broker" means any person who, for compensation or gain, or in the expectation of compensation or gain, either directly or indirectly accepts or offers to accept an application for a mortgage loan, solicits or offers to solicit a mortgage loan on behalf of a borrower, or negotiates or offers to negotiate the terms and conditions of a mortgage loan on behalf of a lender. (11) "Mortgage lender" means: (A) Any person who- (i) makes a mortgage loan to any person; or (ii) engages in the business of servicing mortgage loans for others or collecting or otherwise receiving mortgage loan payments directly from borrowers for distribution to any other person. (B) A mortgage lender does not include: (i) a financial institution that accepts deposits and is regulated under this title; (ii) the Federal Home Loan Mortgage Corporation; (iii) the Federal National Mortgage Association; (iv) the Government National Mortgage Association; or (v) any person engaged exclusively in the acquisition of all or any portion of a mortgage loan under any federal, state, or local governmental program of mortgage loan purchases. (12) "Mortgage loan" means any loan or other extension of credit that is secured, in whole or in part, by any interest in residential real property in the United States Virgin Islands. (13) "Nonprofit corporation" means a corporation no part of the income of which is distributable to its members, directors or officers. Nothing in this chapter shall be construed as prohibiting the payment of reasonable compensation for services rendered and the making of distribution upon dissolution of final liquidation. (14) "Person" means an individual, firm, corporation, business trust, estate, trust, partnership, association, two or more persons having a joint or common interest, or any other legal or commercial entity, or group of individuals however organized. (15) "Principal" means any person who, directly or indirectly, owns or controls 10% or more of the outstanding stock of a stock corporation, or 10% or greater interest in a nonstock corporation or a limited liability company. (16) "Residential real property" means any owner-occupied real property located in the Virgin Islands which has a dwelling on it designed principally as a residence with accommodations for not more than four families. This term does not include any real property held primarily for rental, investment, or the generation of income through any commercial or industrial enterprise. (17) "State" means the Territory or any state or territory of the United States. (18) "Territory" means the Virgin Islands. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 32-35.

The provisions of this chapter do not apply to: (1) Any bank, trust company, savings bank, savings and loan association, or credit union incorporated or chartered under the laws of the United States, any state or territory of the United States, or the Virgin Islands, and any other financial institution incorporated or chartered under the laws of the Virgin Islands or of the United States, that accepts deposits, and subsidiaries and affiliates of such entities that maintain their principal office or a branch office in the Virgin Islands and in which the lender, subsidiary, or affiliate is subject to the general supervision or regulation of, or subject to audit or examination by, a regulatory body or agency of the, [sic] any state or territory of the United States, or the United States Virgin Islands. (2) Any insurance company authorized to do business in this Territory; (3) Any corporate instrumentality of the United States government including: (A) The Federal Home Loan Mortgage Corporation; (B) The Federal National Mortgage Association; and (C) The Government National Mortgage Association. (4) Any person who takes back a deferred purchase money mortgage in connection with the sale of: (A) Residential real property owned by, and titled in the name of, that person; or (B) A new residential dwelling that the person built. (5) A person making an intra-family mortgage loan to a borrower who is related as provided in title 33 Virgin Islands Code, section 128, paragraph (8); (6) Nonprofit corporations making mortgage loans to promote home ownership or improvements for low and moderate income households; (7) Agencies of the federal government, this Territory, or any state or municipal government, or any quasi- governmental agency making mortgage loans under the specific authority of the laws or regulations of any state, this Territory, or the United States, including, without limitation, the V.I. Housing Finance Authority with respect to its activities in offering, accepting, completing, and processing mortgage loan applications under its programs; (8) Persons acting as fiduciaries, with respect to any employee pension benefit plan qualified under the Internal Revenue Code, who make mortgage loans solely to plan participants from plan assets; (9) Persons licensed in the United States Virgin Islands as attorneys, real estate brokers, or real estate salespersons, not actively and principally engaged in negotiating, placing, or finding mortgage loans, when rendering services as an attorney, real estate broker, or real estate salesperson; however, a real estate broker or a real estate salesperson who receives any fee, commission, kickback, rebate, or other payment for directly or indirectly negotiating, placing or finding a mortgage loan for others shall not be exempt from the provisions of this chapter; and (10) Persons acting in a fiduciary capacity conferred by authority of any court. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 35-36.

(a) No person may engage in business as a mortgage lender or mortgage broker, or both, or hold himself out to the public to be a mortgage lender or mortgage broker unless such person has first obtained a license under this chapter. (b) To qualify for a license, an applicant must satisfy the Banking Board that the applicant, including its members, officers, directors, and principals, is of good moral character and has sufficient financial responsibility, business experience, and general fitness to: (1) engage in business as a mortgage lender or mortgage broker; (2) warrant the belief that the business will be conducted lawfully, honestly, fairly, and efficiently; and (3) in the case of an applicant for license to act as a mortgage lender, capitalize the business by maintaining at least $500,000 of funds available, and in the ease of an applicant for a license to act as a mortgage broker, capitalize the business by maintaining at least $25,000 of funds available. (c) The Banking Board may deny an application for a license to any person who has committed any act prior to the granting of the license that would be a ground for suspension or revocation of a license under this chapter. (d) To apply for a license an applicant shall: (1) complete, sign and submit to the Banking Board an application made under oath on the form that the Banking Board requires; and (2) comply with all conditions and provisions of the application for licensure. (e) The application must include: (1) If the applicant is an individual, the applicant's name, business address and telephone number, and residential address and telephone number; (2) If the applicant is a partnership, limited liability company, or other unincorporated business association, the business name, business address and telephone number, and the residential address and telephone number of each. (A) general partner, if the applicant is a limited partnership; (B) general partner who holds an interest in the partnership of more than 10%, if the applicant is a general partnership; or (C) member, if the applicant is a limited liability company or a non-corporate business association; (3) If the applicant is a corporation: (A) the name, address, and telephone number of the corporate entity; and (B) the name, business telephone number, and residential address and telephone number of the president, senior vice presidents, secretary, treasurer, and each director and each stockholder owning or controlling 10% or more of any class of stock in the corporation; (4) The name under which the mortgage lender or mortgage broker business is to be conducted; (5) The name and address of the applicant's registered agent; (6) The address of the location of the business to be licensed; (7) Whether the applicant seeks a license to act as a mortgage lender, mortgage broker, or both; and (8) Such other information concerning the financial responsibility, background, experience, and activities of the applicant and its members, officers, directors, and principals as the Banking Board may require. (f) With each application, the applicant shall pay such fees as promulgated by the Banking Board. (g) For each license for which an applicant applies, the applicant shall: (1) submit a separate application; (2) pay a separate license fee; and (3) file a separate surety bond or other financial guaranty under subsection (i) of this section. (h) An applicant for an original license or for the renewal of a license shall file a surety bond with each original application and any renewal application for the license. (1) The surety bond shall: (A) run to the Government of the Virgin Islands for the benefit of any person who has been damaged by a licensee as a result of violating any law or regulation governing the activities of mortgage lenders or mortgage brokers; (B) be issued by a surety company authorized to do business in the Virgin Islands; (C) be conditioned upon the applicant's complying with all of the Territory's laws regulating the activities of mortgage lenders and mortgage brokers, performing all written agreements with borrowers or prospective borrowers and accounting for all funds received by the licensee in conformity with a consistently applied standard system of accounting; and (D) be continuously maintained thereafter for as long as any license issued under this chapter remains in force. (2) If an applicant has not conducted business as a mortgage lender or mortgage broker in the Virgin Islands in any of the three calendar years preceding the year in which an original application for a license is filed, the surety bond required under this subsection shall be in the amount of $25,000. (3) If an applicant has conducted business as a mortgage lender or mortgage broker in the Virgin Islands in any of the three calendar years preceding the year in which an original or renewal application is filed, the applicant shall provide a sworn statement setting forth the total dollar amount of mortgage loans applied for and accepted or mortgage loans applied for, procured, and accepted by the mortgage lender or mortgage broker during the latest calendar year such business was conducted. The bond required in this circumstance is determined as follows: (A) Where the total dollar amount of stated loans was $1,000,000 or less, the bond shall be in the amount of $25,000; (B) Where the total dollar amount of stated loans was more than $1,000,000 but not more than $2,000,000, the bond shall be in the amount of $30,000; (C) Where the total dollar amount of stated loans was more than $2,000,000 but not more than $3,000,000, the bond shall be in the amount of $40,000; and (D) Where the total dollar amount of stated loans was more than $3,000,000, the bond shall be in the amount of $50,000. (4) Subject to approval by the Banking Board, if an applicant files four or more original or renewal applications at the same time, the applicant may provide a blanket surety bond for all licensed offices in the amount of $200,000. (5) Any person who may be damaged by noncompliance of a licensee with any condition of such bond may proceed on such bond against the principal or surety thereon, or both, to recover damages. The aggregate liability under the bond may not exceed the penal sum of the bond. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 36-40.

(a) When an applicant for a license files the application and bond and pays the fees required by this chapter, the Banking Board shall investigate to determine if the applicant meets the requirements of this chapter. The Banking Board shall make such investigations as necessary to determine if the applicant has complied with all applicable provisions of law and any regulations promulgated thereunder. (b) The Banking Board shall approve or deny each application for a license within 60 days after the date when the application and bond are filed, all requested information and required data are submitted, and the fees are paid. (c) The Banking Board shall issue a license to any applicant who meets the requirements of this chapter. (d) Every license shall remain in force until it has been surrendered, revoked, or suspended. The surrender, revocation, or suspension of a license does affect any pre-existing legal right or obligation of such licensee. (1) A license issued under this section authorizes the licensee to act as mortgage lender or mortgage broker under the license at the licensed place of business. (2) Only one place of business may be maintained under any one license. (3) A licensee may maintain more than one license under this section if a separate application for each license is made pursuant to section 363 of this chapter, and the Banking Board approves the application. (e) (1) The Banking Board shall include on each license: (A) the name of the licensee; and (B) the physical address at which the business is to be conducted. (2) A person may not conduct any mortgage loan business at any location or under any name different from the address and name that appears on the person's license. (f) (1) A licensee may not receive any application for a loan or allow any note or contract for a loan or mortgage, or evidence of indebtedness to be signed or executed at any place for which the licensee does not have a license, except at the office of: (A) The attorney for the borrower or for the licensee; or (B) A title insurance company, a title company, or an attorney for a title insurance company or a title company. (2) Notwithstanding paragraph paragraph (1)(A)ubsection, a licensee may accept a loan application from a borrower by mail or telephone or in person at the borrower's residence or place of employment to accommodate the borrower at the borrower' s request. (3) The Banking Board shall promulgate regulations pursuant to title 3 Virgin Islands Code, chapter 35, to ensure that the loan application process is conducted fairly and in a manner consistent with the best interests of both the borrower and mortgage lender. (g) A license may be issued under this chapter to a business entity whose principal office is located outside the Virgin Islands if the business entity maintains a resident agent within the Territory at all times during the term of the license, regardless of whether: (1) The business entity maintains any office within the Virgin Islands; and (2) The activities of the business entity constitute doing business or having a tax situs in the Virgin Islands. (h) Each license must be prominently posted in each place of business of the licensee. Licenses are not transferable or assignable, by operation of law or otherwise. No licensee may use any name other than the name set forth on the license issued by the Banking Board. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 40-42.

(a) Except as provided in this section, no person may acquire directly or indirectly 25% or more of the voting shares of a corporation or 25% of the ownership of any other entity licensed to conduct business under this chapter unless such person first: (1) files an application with the Banking Board in such form as the Banking Board may prescribe from time to time; (2) delivers such other information to the Banking Board as it may require concerning the financial responsibility, background, experience, and activities of the applicant, its directors, officers, principals, and members, and of any proposed new directors, officers, principals, or members of the licensee; and (3) pays such application fee as the Banking Board may prescribe. (b) Upon the filing and investigation of an application, the Banking Board shall permit the applicant to acquire the interest in the licensee if it finds that the applicant, its members, if applicable, its directors, officers, and principals and any proposed new directors, members, officers, and principals have the financial responsibility, character, reputation, experience and general fitness to warrant the belief that the business will be operated efficiently and fairly, in the public interest, and in accordance with the law. The Banking Board shall grant or deny the application within 60 days after the date a completed application, accompanied by the required fee, is filed unless the period is extended by order of the Banking Board reciting the reasons for the extension. If the application is denied, the Banking Board shall notify the applicant of the denial and the reasons for the denial. (c) The provisions of this section do not apply to: (1) the acquisition of an interest in a licensee directly or indirectly, including an acquisition by merger or consolidation, by or with a person licensed by this chapter or a person exempt from this chapter; (2) the acquisition of an interest in a licensee directly or indirectly, including an acquisition by merger or consolidation, by or with a person affiliated through common ownership with the licensee; or (3) the acquisition of an interest in a licensee by a person by bequest, descent, survivorship, or operation of law. (d) the person acquiring an interest in a licensee in a transaction which is exempt from filing an application pursuant to subsection (c) of this section shall send written notice to the Banking Board of such acquisition within 10 days after the closing of such acquisition. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 42-43.

(a) (1) If an applicant does not meet the requirements of section 363 of this chapter, the Banking Board shall: (A) immediately notify the applicant in writing of this fact; (B) return the bond filed; and (C) refund the license fee. (2) The Banking Board shall keep the investigation fee and application fee. (b) Within 30 days after the Banking Board denies an application, the Banking Board shall: (1) issue a written decision containing the reasons upon which the denial was based; (2) send a copy of the decision to the applicant; and (3) advise the applicant of a right to a hearing. (c) (1) An applicant who seeks a hearing on a license application denial shall file a written request for a hearing within 45 days following receipt of the written decision for denial. (2) A hearing date established in response to the filing of a notice under this subsection may be postponed only once for a period of up to 30 days after the initial hearing date. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 43.

(a) A license expires an December 31 after its effective date, unless the license is renewed for a one year term as provided in this section. (b) Before a license expires, the licensee periodically may renew the license for additional one year terms, if the licensee; (1) otherwise is entitled to be licensed; (2) submits to the Banking Board a renewal application on the form that the Banking Board prescribes; and (3) files a bond or bond continuation certificate for the amount required under section 363 of this chapter. (c) If a license is issued for less than a full year, is surrendered voluntarily, is suspended, or is revoked, the Banking Board may not refund any part of the license fee, regardless of the time remaining in the license year. (d) In order to defray the costs of the examination, supervision, and regulation of mortgage lenders, every mortgage lender required to be licensed under this chapter shall pay an annual renewal fee calculated in accordance with a schedule set by regulations promulgated by the Banking Board. The schedule must bear a reasonable relationship to the total assets of such individual mortgage lenders and to other factors relating to their supervision and regulation. Every mortgage broker required to be licensed under this chapter shall pay an annual renewal fee calculated in accordance with a schedule set by regulation promulgated by the Banking Board. All such fees must be paid by the licensed mortgage lenders and mortgage brokers upon submission of the renewal application. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 43-44.

(a) A licensee may not change the place of business for which a license is issued, unless the licensee: (1) notifies the Banking Board in writing of the proposed change; and (2) receives the written consent of the Banking Board. (b) The application for a change of place of business shall be approved, unless the Banking Board finds that the applicant has not conducted business under this chapter efficiently, fairly, in the public interest, and in accordance with all applicable laws and regulations. (c) Notwithstanding subsection (a)(2) of this section, if the Banking Board does not approve or disapprove of the proposed change of place of business within 30 days of the mailing of the notice required under subsection (a)(1) of this section, the proposed change of place of business shall be deemed approved. (d) After approval, the applicant for a change of place of business shall give written notice to the Banking Board within 10 days after the commencement of business at the additional or relocated office. (e) Every licensee shall notify the Banking Board, in writing of the closing of any office not less than 10 days before such closing, and of the name, address, and position of each new principal, officer, member, partner or director not more than 10 days after such new principal, officer member, partner, or director assumes such position. Every licensee shall also provide such other information with respect to any changes as the Banking Board may reasonably require. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 44-45.

(a) Each licensee shall keep and make available to the Banking Board at the licensee's place of business any books and records that the Banking Board, by regulation requires to enable the Banking Board to enforce this chapter and any regulation adopted under this chapter. (b) Each mortgage lender required to be licensed under this chapter shall retain for at least 3 years after final payment is made on any mortgage loan or after the mortgage loan is sold, whichever first occurs, copies of the note, settlement statement, truth-in-lending disclosure, and such other papers or records relating to the loan as may be required by regulation. (c) On approval of the Banking Board, a licensee need not keep at the licensee's place of business any books and records otherwise required by the Banking Board under subsection (a) of this section if the licensee: (1) is a federally approved seller-servicer; or (2) makes the books and records available to the Banking Board at the licensee's place of business within 5 business days of the Banking Board's official request; and (3) retains the records for at least sixty months in a storage facility disclosed to the Banking Board. (d) Each mortgage broker required to be licensed under this chapter shall retain for at least three years after a mortgage loan is made the original contract for his compensation, a copy of the settlement statement, an account of fees received in connection with the loan, and such other papers or records as may be required by rule or regulation. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 45-46.

(a) Each mortgage lender or mortgage broker required to be licensed under this chapter shall annually, on or before March 31, file a written report with the Banking Board containing such information as the Banking Board may require concerning the licensee's operations during the preceding calendar year as to each licensed place of business. Reports must be accompanied by a sworn affidavit and in the form prescribed by the Banking Board, which shall make and publish annually an analysis and recapitulation of the reports. (b) Annual reports must include: (1) the number and total dollar amount of mortgage loans which were originated or purchased by the licensee in the Virgin Islands during each fiscal year for which a valid license is maintained by the licensee; and (2) the number and dollar amount of all loans where the applicant filed notices of intent to foreclose in the last year, including the borrower's: (A) address; (B) income level; and (C) property location. (c) Any information relating to mortgage loans required to be maintained under subsection (b) of this section shall be itemized in order to disclose for each such item: (1) the number and dollar amount of mortgage loans made to mortgagors who did not, at the time of execution of the mortgage, intend to reside in the property securing the mortgage; and (2) the number and dollar amount of mortgage loans and completed applications involving mortgagors or mortgage applicants grouped according to property location, income level, and gender. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 46.

(a) A licensee may surrender a license by sending to the Banking Board the license and a written statement that the license is surrendered. (b) The surrender of a license does not affect any civil or criminal liability of a licensee for acts committed before the license was surrendered. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 47.

(a) The Banking Board or its designated agent shall examine the affairs, business, premises, and records of each licensee at least once in every three year period and at any other time the Banking Board reasonably considers necessary. (b) (1) Any person aggrieved by the conduct of a licensee under this chapter in connection with a mortgage loan may file a written complaint with the Banking Board, which shall investigate the complaint. (2) The Banking Board may make any other examination or investigation of any person, if the Board has reasonable cause to believe that the person has violated any provision of this chapter, any regulation adopted under this chapter, or any other law regulating mortgage loan lending in the United States Virgin Islands. (c) In the course of any investigation or examination, the owners, members, officers, directors, partners, and any employees of such mortgage lender or mortgage broker being investigated or examined shall afford the Banking Board full access to all premises, books, and records. For the foregoing purposes, the Banking Board, or its designated agent, has authority to administer oaths, examine under oath all the aforementioned persons, compel the production of papers and objects of all kinds, subpoena documents or other evidence, and summon and examine under oath any person whose testimony the Board requires. (d) (1) If any person fails to comply with a subpoena or summons of the Banking Board under this chapter or to testify concerning any matter about which the person may be interrogated under this chapter, the Banking Board may request the filing of a petition for enforcement by the Attorney General of the Virgin Islands. (2) On petition by the Attorney General, the court may order the person to attend and testify or produce evidence. (e) When it becomes necessary to examine or investigate the books and records of a licensee required to be licensed under this chapter at a location outside the Virgin Islands, the licensee shall be liable for, and shall pay to the Banking Board, within 30 days, the actual travel and reasonable living expenses incurred on account of its examination, supervision, and regulation, or shall pay a reasonable per diem rate approved by the Banking Board. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 47-48.

(a) (1) A licensee who offers to make or procure a loan secured by a first or subordinate mortgage on a single to four-family home to be occupied by the borrower shall provide the borrower with a financing agreement executed by the lender. (2) The financing agreement shall provide: (A) The term and principal amount of the loan; (B) An explanation of the type of mortgage loan being offered; (C) The rate of interest that will apply to the loan and, if the rate is subject to change, or is a variable rate, or is subject to final determination at a future date based on some objective standard, a specific statement of those facts; provided that loans under $100,000 shall comply with the territory's usury laws. (D) The points and all fees, if any, to be paid by the borrower or the seller, or both; and (E) The term during which the financing agreement remains in effect. (3) If all the provisions of the financing agreement are not subject to future determination, change, or alteration, the financing agreement shall constitute a final binding agreement between the parties as to the items covered by the financing agreement. (b) (1) The financing agreement executed by the lender must be delivered to the borrower at least 72 hours before the time of settlement agreed to by the parties and must include: (A) The effective fixed interest rate or initial interest rate that will be applied to the loan; and (B) A restatement of all the remaining unchanged provisions of the financing agreement. (2) Prior to execution of the financing agreement, the borrower may waive in writing the 72-hour advance presentation requirement and accept the commitment at settlement only if compliance with the 72-hour requirement is shown by the lender to be infeasible. (3) A borrower aggrieved by any violation of this section shall be entitled to bring a civil suit for damages, including reasonable attorney's fees, against the lender. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 48-49.

(a) No mortgage lender or mortgage broker required to be licensed under this chapter may: (1) obtain any agreement or instrument in which blanks are left to be filled in after execution; (2) take an interest in collateral other than the real estate or residential property, including fixtures and appliances thereon, securing a mortgage loan; (3) obtain any exclusive dealing or exclusive agency agreement from any borrower; (4) delay closing of any mortgage loan for the purpose of increasing interest, costs, fees, or charges payable by the borrower; (5) obtain any agreement or instrument executed by a borrower which contains an acceleration clause permitting the unpaid balance of a mortgage loan to be declared due for any reason other than failure to make timely payments of interest and principal or to perform other obligations undertaken in the agreement or instrument; (6) make, directly or indirectly, any mortgage loan with the intent to foreclose on the borrower's property. For purposes of this paragraph, any of the following factors may be considered in determining whether a mortgage loan was made with the intent to foreclose on the borrower's property: (A) Lack of the probability of full repayment of the loan by the borrower; and (B) A significant proportion of similarly foreclosed loans by the lender; (7) If acting as a mortgage lender, fail to require the person closing the mortgage loan to provide to the borrower prior to the closing of the mortgage loan: (A) A settlement statement as required pursuant to the Real EstatReal Estate Settlement Procedures Act December 22, 1974 (88 Stat. 1724; 12 U.S.C. §2601 et seq.), and any regulations promulgated thereunder; and (B) Any disclosure that is required by the Truth in Lending AcLending Act May 29,1968 (82 Stat. 146; 15 U.S.C. §1601 et seq.), and Regulation Z ( 12 CFR Part 226 ); or (8) Except for an application fee in an amount not to exceed 1% of the original principal amount of the mortgage loan applied for, and documented costs of credit reports and appraisals, receive compensation from a borrower until a written commitment to make a mortgage loan is given to the borrower by a mortgage lender which written commitment shall be given not less than 72 hours prior to the closing of the mortgage loan. (b) No mortgage broker required to be licensed under this chapter may: (1) receive compensation from a mortgage lender of which he is a principal, partner, trustee, director, member, officer, or employee; (2) receive compensation from a borrower in connection with any mortgage loan transaction in which he is the lender or a principal, partner, trustee, director, member, officer, or employee of the mortgage lender; or (3) (A) receive compensation for negotiating, placing, or finding a mortgage loan where a mortgage broker, or any person affiliated with such mortgage broker otherwise acted as a real estate broker, agent, or salesperson in connection with the sale of the real estate which secures the mortgage loan and such mortgage broker or affiliated person has received or will receive any other compensation or thing of value from the lender, borrower, seller, or any other person, unless the borrower is given the following notice in writing at the time the mortgage broker's services are first offered to the borrower: DISCLOSURE OF DUAL CAPACITY: WE HAVE OFFERED TO ASSIST YOU IN OBTAINING A MORTGAGE LOAN. IF WE ARE SUCCESSFUL IN OBTAINING A LOAN FOR YOU, WE WILL CHARGE AND COLLECT FROM YOU A FEE NOT TO EXCEED ___% OF THE LOAN AMOUNT. THIS FEE IS IN ADDITION TO ANY OTHER FEE WE MAY RECEIVE IN CONNECTION WITH THE SALE OR PURCHASE OF THE REAL ESTATE THAT WILL SECURE THE LOAN. WE DO NOT REPRESENT ALL OF THE LENDERS IN THE MARKET AND THE LENDERS WE DO REPRESENT MAY NOT OFFER THE LOWEST INTEREST RATES OR BEST TERMS AVAILABLE TO YOU. YOU ARE FREE TO SEEK A LOAN WITHOUT OUR ASSISTANCE, IN WHICH EVENT YOU WILL NOT BE REQUIRED TO PAY US A FEE FOR THAT SERVICE. THE BORROWER ACKNOWLEDGES HAVING READ AND UNDERSTOOD THIS DISCLOSURE OF DUAL CAPACITY AND HAVING RECEIVED A COPY HEREOF. ____________________BORROWER'S SIGNATURE ____________________BORROWER'S DATE (B) The foregoing notice must be at least 10-point type and the prospective borrower shall acknowledge receipt of the written notice. (C) The phrase "person affiliated with such mortgage broker" means any person that is a subsidiary, stockholder, partner, trustee, director, member, officer, or employee of a mortgage broker, and any corporation, 10% or more of the capital stock of which is owned by a mortgage broker or by any person which is a subsidiary, stockholder, partner, trustee, director, member, officer or employee of a mortgage broker. (c) Notwithstanding the provisions of subsection (b) of this section, no person may act as a mortgage broker in connection with any real estate sales transaction entered into prior to the enactment into law of this chapter, in which such person, or any person affiliated with such person, has acted as a real estate broker, agent, or salesperson and has received or will receive compensation in connection with such transaction, unless such person was regularly engaged in acting as a mortgage broker in connection with such transaction as of the date of enactment into law of this chapter. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 49-52.

(a) All moneys required by a mortgage lender to be paid by borrowers in escrow to defray future taxes or insurance premiums, or for other lawful purposes, must be kept in accounts segregated from accounts of the mortgage lender, and shall not be commingled with other funds of the mortgage lender. (b) No licensed mortgage lender may require any borrower who, on the date of execution of the loan or financial transaction, has made a down payment equaling 20% or more of the total purchase price of the property or who has an equity interest in the property equal to, or greater than, 20% of the fair market value of the property, to make advance payments of the real estate taxes or casualty insurance premiums to enable the mortgage lender to have funds on hand for disbursement for payment of such taxes or insurance premiums. Licensed mortgage lenders shall provide such borrowers with a separate statement, in writing, which clearly and conspicuously sets forth the right to pay such taxes and insurance premiums directly. Nothing contained in this subsection may be construed to prohibit a licensed mortgage lender from obtaining, during any period during which the loan is in default and in consideration for the lender not exercising some or all of the remedies to which it is entitled, a written agreement from the borrower to make such advance payments to enable the mortgage lender to have funds on hand for disbursement from payment of such taxes or insurance premiums. (c) No licensed mortgage lender may require any borrower to pay any money in escrow to defray future taxes and insurance premiums, or for any other purposes, in connection with a subordinate mortgage loan, except where escrows for such purposes are not being maintained in connection with the mortgage loan superior to such subordinate History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 52.

No mortgage lender or mortgage broker required to be licensed under this chapter may use, or cause to be published, any advertisement which: (1) contains any false, misleading, or deceptive statement or representation; or (2) identifies the lender or broker by any name other than the name set forth on the license issued by the Banking Board. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 52-53.

(a) If the Banking Board finds that the conduct of any other business conceals a violation or evasion of this chapter, any rule or regulation adopted under this chapter, or any law regulating mortgage loan lending in the Virgin Islands, the Banking Board may issue a written order to a licensee to: (1) stop doing business at any place in which the other business is conducted or solicited; or (2) stop doing business in association or conjunction with the other business. (b) A licensee who violates an order of the Banking Board issued under this section shall be subject to the penalties provided by section 378 of this chapter. (c) The Banking Board may request the Attorney General of the Virgin Islands to take appropriate action for the enforcement of an order issued under this section. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 53.

(a) The Banking Board may suspend or revoke the license of any licensee, if the licensee or any owner, director, officer, member, partner, stockholder, employee, or agent of the licensee, while acting on behalf of the licensee: (1) makes any material misstatement in an application for a license; (2) has been convicted of any crime of moral turpitude; (3) In connection with any mortgage loan or loan application transaction: (A) commits any fraud; (B) engages in any illegal or dishonest activities; or (C) misrepresents or fails to disclose any material facts to anyone entitled to that information; (4) violates any provision of this chapter, any rule or regulation adopted under it, or any other law regulating mortgage loan lending in the Territory. (5) engages in a course of conduct consisting of the failure to perform written agreements with borrowers; (6) fails to account for funds received or disbursed to the satisfaction of the person supplying or receiving such funds; (7) fails to disburse funds in accordance with any agreement connected with, and promptly upon closing of, a mortgage loan, taking into account any applicable right of rescission; (8) is convicted of a felony or misdemeanor involving fraud, misrepresentation, or deceit; (9) has a judgment entered against such licensee involving fraud, misrepresentation, or deceit; (10) has been found by a federal, state or territorial agency to be in violation of any law or any regulation applicable to the conduct of the licensee's business; (11) refuses to permit an investigation or examination by the Banking Board; (12) fails to pay any fee or assessment imposed by this chapter; (13) fails to comply with any order of the Banking Board; or (14) otherwise demonstrates unworthiness, bad faith, dishonesty, or any other quality that indicates that the business of the licensee has not been, or will not be, conducted honestly, fairly, equitably, and efficiently. (b) (1) The Banking Board may enforce the provisions of this section or any rules and regulations adapted by issuing an order: (A) to cease and desist from the violation and any further similar violations; and (B) requiring the violator to take affirmative action to correct the violation including the restitution of money or property to any person aggrieved by the violation. (2) If a violator fails to comply with an order issued under paragraph (1) of this subsection, the Banking Board may impose a civil penalty of up to $1000 for each violation from which the violator failed to cease and desist or for which the violator failed to take affirmative action to correct. (c) The Banking Board may request the Attorney General of the Virgin Islands to take appropriate action in the Superior Court of the Virgin Islands for the enforcement of an order issued under this section. The Attorney General may also seek, and the Superior Court may order or decree, damages and such other relief allowed by law, including restitution. Persons entitled to any relief as authorized by this section must be identified by order of the court within 180 days after the date of the order permanently enjoining the unlawful act or practice. In any action brought by the Attorney General by virtue of this provision, the Attorney General is entitled to seek attorney's fees and costs. (d) In determining the amount of financial penalty to be imposed under subsection (b) of this section, the Banking Board shall consider the following: (1) the seriousness of the violation; (2) the good faith of the violator; (3) the violator's history of previous violations; (4) the deleterious effect of the violation on the public and mortgage industry; (5) the assets of the violator; and (6) any other factors relevant to the determination of the financial penalty. (e) Nothing in this chapter may be construed to preclude any individual or entity who suffers loss as a result of any violation to this chapter from maintaining an action to recover damages or restitution and, as provided by statute, attorney's fees. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 53-55.

(a) Before the Banking Board takes any action under section 377 or section 378 of this chapter, the Banking Board shall give the licensee an opportunity for a hearing. (b) The hearing notice to the licensee must be sent by certified mail, return receipt requested, to the principal place of business of the licensee at least 30 days before the hearing. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, pp. 55-56.

A mortgage lender or mortgage broker may not do business under any trade name that misrepresents or tends to misrepresent that the mortgage lender is: (1) a bank, trust company, or savings bank; (2) a savings and loan association; (3) a credit union; or (4) an insurance company. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 56.

The Banking Board is authorized to promulgate such regulations pursuant to title 3 Virgin Islands Code, chapter 35, as necessary and appropriate to implement the provisions of this chapter. History: Added Mar. 5, 2005, No. 6727, § 9, Sess. L. 2005, p. 56.

(a) This subchapter may be cited as "The Virgin Islands Secure and Fair Enforcement for Mortgage Licensing Act of 2009". (b) The activities of mortgage loan originators and the origination or offering of financing for residential real property have a direct, valuable and immediate impact upon Virgin Islands' consumers, Virgin Islands' economy, the neighborhoods and communities of Virgin Islands, and the housing and real estate industry. The Legislature finds that accessibility to mortgage credit is vital to the Virgin Islands' citizens. The Legislature also finds that it is essential for the protection of the citizens of the Virgin Islands and the stability of the Virgin Islands' economy that reasonable standards for licensing and regulation of the business practices of mortgage loan originators be imposed. The Legislature further finds that the obligations of mortgage loan originators to consumers in connection with originating or making residential mortgage loans are such as to warrant the regulation of the mortgage lending process. The purpose of this subchapter is to protect consumers seeking mortgage loans and to ensure that the mortgage lending industry is operating without unfair, deceptive, and fraudulent practices on the part of mortgage loan originators. (c) Therefore, the Legislature establishes within this subchapter a system that: (1) Provides uniform license applications and reporting requirements for State-licensed mortgage loan originators; (2) Provides a comprehensive licensing and supervisory database; (3) Aggregates and improves the flow of information to and between regulators; (4) Provides increased accountability and tracking of loan originators; (5) Streamlines the licensing process and reduces the regulatory burden; (6) Enhances consumer protections and supports anti-fraud measures; (7) Provides consumers with easily accessible information, offered at no charge, utilizing electronic media, including the internet, regarding the employment history of and publicly adjudicated disciplinary and enforcement actions against, loan originators; (8) Establishes a means by which residential mortgage loan originators would, to the greatest extent possible, be required to act in the best interests of the consumer; (9) Facilitates responsible behavior in the subprime mortgage market place and provides comprehensive training and examination requirements related to subprime mortgage lending; and (10) Facilitates the collection and disbursement of consumer complaints on behalf of State and Federal mortgage regulators. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 275, 276.

As used in this subchapter- (a) The term "depository institution" has the same meaning as in section 3 of the Federal Deposit Insurance Act, and includes any credit union. (b) The term "federal banking agencies" means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation. (c) The term "immediate family member" means a spouse, child, sibling, parent, grandparent, or grandchild. This includes stepparents, stepchildren, stepsiblings, and adoptive relationships. (d) The term "individual" means a natural person. (1) The term "loan processor or underwriter" means an individual who performs clerical or support duties as an employee at the direction of and subject to the supervision and instruction of- (A) a State-licensed mortgage loan originator; or (B) a registered loan originator. (2) The term "clerical or support duties" may include subsequent to the receipt of an application- (A) The receipt, collection, distribution, and analysis of information common for the processing or underwriting of a residential mortgage loan; and (B) Communicating with a consumer to obtain the information necessary for the processing or underwriting of a loan, to the extent that such communication does not include offering or negotiating loan rates or terms, or counseling consumers about residential mortgage loan rates or terms. (3) Representations to the Public. An individual engaging solely in loan processor or underwriter activities, shall not represent to the public, through advertising or other means of communicating or providing information including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that such individual can or will perform any of the activities of a mortgage loan originator. (4) The term "mortgage loan originator"- (A) means an individual who for compensation or gain or in the expectation of compensation or gain- (i) Takes a residential mortgage loan application; or (ii) Offers or negotiates terms of a residential mortgage loan; or (iii) assists a consumer in obtaining or applying to obtain a residential mortgage loan by, among other things, advising on loan terms, including rates, fees, other costs, preparing loan packages, or collecting information on behalf of the consumer with regard to a residential mortgage loan. (B) does not include an individual engaged solely as a loan processor or underwriter except as otherwise provided in this subchapter; (C) does not include a person or entity that only performs real estate brokerage activities and is licensed or registered in accordance with Virgin Islands law, unless the person or entity is compensated by a lender, a mortgage broker, or other mortgage loan originator or by any agent of such lender, mortgage broker, or other mortgage loan originator; and (D) does not include a person or entity solely involved in extensions of credit relating to timeshare plans, as that term is defined in section 101(53D) of title 11, United States Code. (5) The term "real estate brokerage activity" means any activity that involves offering or providing real estate brokerage services to the public, including- (A) Acting as a real estate agent or real estate broker for a buyer, seller, lessor, or lessee of real property; (B) Bringing together parties interested in the sale, purchase, lease, rental, or exchange of real property; (C) Negotiating, on behalf of any party, any portion of a contract relating to the sale, purchase, lease, rental, or exchange of real property, other than in connection with providing financing with respect to any such transaction; (D) Engaging in any activity for which a person engaged in the activity is required to be registered or licensed as a real estate agent or real estate broker under any applicable law; and (E) Offering to engage in any activity, or act in any capacity, described in subparagraphs (A), (B), (C), or (D) of this paragraph. (e) The term "Nationwide Mortgage Licensing System and Registry" means a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of State-licensed loan originators and the registration of registered loan originators or any system established by the Secretary under Public Law 110-289, section 1509. (f) The term "nontraditional mortgage product" means any mortgage product other than a 30-year fixed rate mortgage. (g) The term "registered mortgage loan originator" means any individual who- (1) Meets the definition of mortgage loan originator and is an employee of- (A) A depository institution; (B) A subsidiary that is- (i) Owned and controlled by a depository institution; and (ii) Regulated by a federal banking agency; or (C) An institution regulated by the Farm Credit Administration; and (2) Is registered with, and maintains a unique identifier through, the Nationwide Mortgage Licensing System and Registry. (h) The term "residential mortgage loan" means any loan primarily for personal, family, or household use which is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling, as defined in section 103(v) of the Truth in Lending Act or residential real estate upon which is constructed or intended to be constructed a dwelling, as so defined. (i) The term "residential real estate" means any real property located in the Virgin Islands, upon which is constructed or intended to be constructed a dwelling. (j) The term "Secretary" means the Secretary of Housing and Urban Development. (k) The term "State-licensed mortgage loan originator" means any individual who- (A) is a mortgage loan originator; (B) is not an employee of- (i) a depository institution; (ii) a subsidiary that is- (1) owned and controlled by a depository institutions: and (2) regulated by a federal banking agency: or (iii) an institution regulated by the Farm Credit Administration; and (C) is licensed by a State or by the Secretary under Public Law 110-289, section 1508 and registered as a mortgage loan originator with, and maintains a unique identifier through the Nationwide Mortgage Licensing System and Registry. (l) The term "unique identifier" means a number or other identifier that- (1) permanently identifies a loan originator; (2) is assigned by protocols established by the Nationwide Mortgage Licensing System and Registry and the federal Banking agencies to facilitate electronic tracking of loan originators and uniform identification of, and public access to, the employment history of and publicly adjudicated disciplinary and enforcement actions against loan originators; and (3) shall not be used for purposes other than those set forth under this subchapter. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 276-280.

(a) To the greatest extent possible and to accomplish the purpose of this subchapter, the Virgin Islands shall use unique identifiers in lieu of social security numbers. (b) The unique identifier of any person originating a residential mortgage loan must be clearly shown on all residential mortgage loan application forms, solicitations or advertisements, including business cards or websites, and any other documents as established by rule, regulation or order of the Banking Board. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 280.

Underwriters; Independent Contractor Loan Processors Or Underwriters (a) Subject to the existence of a licensing or registration regime, as the case may be, an individual, unless specifically exempted from this subchapter under subsection (c) may not engage in the business of a mortgage loan originator with respect to any dwelling located in the Virgin Islands without first- (1) obtaining and maintaining annually- (A) a registration as a registered loan originator; or (B) a license and registration as a State-licensed mortgage loan originator; and (2) obtaining a valid unique identifier issued by the Nationwide Mortgage Licensing System and Registry. (b) (1) A loan processor or underwriter who does not represent to the public, through advertising or other means of communicating or providing information, including the use of business cards, stationary, brochures, signs, rate lists, or other promotional items, that such individual can or will perform any of the activities of a loan originator is not required to be a State-licensed loan originator. (2) A loan processor or underwriter who is an independent contractor may not engage in the activities of a loan processor or underwriter unless the independent contractor loan processor or underwriter obtains and maintains a license. Each independent contractor loan processor or underwriter licensed as a mortgage loan originator must have and maintain a valid unique identifier issued by the Nationwide Mortgage Licensing System and Registry. (c) The following are exempt from this subchapter: (1) Registered Mortgage Loan Originators, when acting for an entity described in § 383(g)(1)(A), (B), or (C) and (g)(2); (2) Any individual who offers or negotiates terms of a residential mortgage loan with or on behalf of an immediate family member of the individual; (3) Any individual who offers or negotiates terms of a residential mortgage loan secured by a dwelling that served as the individual's residence; (4) A licensed attorney who negotiates the terms of a residential mortgage loan on behalf of a client as an ancillary matter to the attorney's representation of the client, unless the attorney is compensated by a lender, a mortgage broker, or other mortgage loan originator or by any agent of such lender, mortgage broker, or other mortgage loan originator; and (5) Agencies of the federal government, the Territory of the Virgin Islands, or any State or municipal government, or any quasi-governmental agency making mortgage loans under the specific authority of the laws or regulations of any state, the Territory of the Virgin Islands or the United States, including without limitation, the Virgin Islands Housing Finance Authority and the Government Employees Retirement System, with respect to their activities in offering, accepting, completing and processing mortgage loan applications under their programs. (d) Subsection (c)(5) does not apply if the United States Department of Housing and Urban Development determines by guidelines, rules, interpretive letter or otherwise that such individuals must be licensed under the Fair Enforcement for Mortgage Licensing Act of 2008, or that this subsection is otherwise inconsistent with this subchapter. (e) Upon approval or consent by the United States Department of Housing and Urban Development, the Banking Board must be authorized to exempt in whole or in part from this subchapter additional individuals or classes of individuals which the Banking Board finds inappropriate to effectuate the purposes of this chapter. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 281, 282.

(a) Application Form. Applicants for a license shall apply in a form as prescribed by the Banking Board or its designated agent. Each such form must contain content as set forth by rule, regulation, instruction or procedure of the Banking Board or its designated agent and may be changed or updated as necessary by the Banking Board or its designated agent in order to carry out the purposes of this subchapter. (b) Background Checks. In connection with an application for licensing as a mortgage loan originator, the applicant shall, at a minimum, furnish to the Nationwide Mortgage Licensing System and Registry information concerning the applicant's identity, including- (1) Fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a state, national and international criminal history background check; and (2) Personal history and experience in a form prescribed by the Nationwide Mortgage Licensing System and Registry, including the submission of authorization for the Nationwide Mortgage Licensing System and Registry and the Banking Board or its designated agent- (A) An independent credit report obtained from a consumer reporting agency described in section 603(p) of the Fair Credit Reporting Act; and (B) Information related to any administrative, civil or criminal findings by any governmental jurisdiction. (3) Agent. For the purposes of this subsection and in order to reduce the points of contact which the Federal Bureau of Investigation and other entities may have to maintain for purposes of subsection (b) (1) and (b)(2) of this section, the Banking Board or its designated agent may use the Nationwide Mortgage Licensing System and Registry as a channeling agent for requesting information from and distributing information to the Department of Justice or any governmental agency and from any other source so directed by the Banking Board or its designated agent. (c) Issuance of License. The Banking Board may not issue a mortgage loan originator license unless the Banking Board or its designated agent finds that the individual meets the minimum standards for licensing and registration as a State-licensed mortgage loan originator: (1) No License Revocation. The applicant has never had a mortgage loan originator license revoked in any governmental jurisdiction, except that a subsequent formal vacation of such revocation shall not be deemed a revocation. (2) No Felony Conviction. The applicant has not been convicted of, or pled guilty or nolo contendere to a felony in a domestic, foreign, or military court- (A) During the seven-year period preceding the date of the application for licensing and registration; or (B) At any time preceding such date of application, if such felony involved an act of fraud, dishonesty, or a breach of trust, or money laundering; (C) Provided that any pardon of a conviction shall not be a conviction for purposes of this subsection. (3) (A) Character and Fitness. The applicant has demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the mortgage loan originator will operate honestly, fairly, and efficiently within the purposes of this subchapter. (B) For purposes of this subsection an individual has shown that he is not financially responsible when he has shown a disregard in the management of his own financial condition. A determination that an individual has not shown financial responsibility may include, but not be limited to: (i) Current outstanding judgments, except judgments solely as a result of medical expenses; (ii) Current outstanding tax liens or other government liens and filings; (iii) Foreclosures within the past three years; (iv) A pattern of seriously delinquent accounts within the past three years. (4) Pre-Licensing Education. The applicant has completed the pre-licensing education requirement. (A) Minimum Educational Requirements. In order to meet the pre-licensing education requirement, a person shall complete at least 20 hours of education approved in accordance with subparagraph (B) of this paragraph, which must include at least- (i) 3 hours of Federal law and regulations; (ii) 3 hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; and (iii) 2 hours of training related to lending standards for the nontraditional mortgage product marketplace. (B) Approved Educational Courses, Limitations And Standards. For purposes of subparagraph (A) of this paragraph, pre-licensing education courses shall be reviewed, and approved by the Nationwide Mortgage Licensing System and Registry based upon reasonable standards. Review and approval of a pre-licensing education course shall include review and approval of the course provider. (a) To maintain the independence of the approval process, the Nationwide Mortgage Licensing System and Registry may not directly or indirectly offer pre-licensure educational courses for loan originators. (b) In approving courses under this section, the Nationwide Mortgage Licensing System and registry shall apply reasonable standards in the review and approval of courses. (C) Approval of Employer and Affiliate Educational Courses. Nothing in this section precludes any pre-licensing education course, as approved by the Nationwide Mortgage Licensing System and Registry that is provided by the employer of the applicant or an entity that is affiliated with the applicant by an agency contract, or any subsidiary or affiliate of such employer or entity. (D) Venue of Education. Pre-licensing education may be offered either in a classroom, online or by any other means approved by the Nationwide Mortgage Licensing System and Registry. (E) Reciprocity of Education. The pre-licensing education requirements approved by the Nationwide Mortgage Licensing System and Registry in paragraphs (4)(A)(i), (ii) andparagraphs (4)(A)(i), (ii) and (iii)y state may be accepted as credit towards completion of pre- licensing education requirements in the Virgin Islands. (F) Re-Licensing Education Requirements. A person previously licensed under this subchapter subsequent to the effective date of this subchapter applying to be licensed again must prove that they have completed all of the continuing education requirements for the year in which the license was last held. (5) Written Test. The applicant has passed a written test that meets the test requirement described in this subchapter. (A) In order to meet the written test requirement referred to in this subsection an individual shall pass, in accordance with the standards established under this subsection, a qualified written test developed by the Nationwide Mortgage Licensing System and Registry and administered by a test provider approved by the Nationwide Mortgage Licensing System and Registry based upon reasonable standards. (B) Qualified Test. A written test may not be treated as a qualified written test for purposes of subparagraph (A), unless the test adequately measures the applicant's knowledge and comprehension in appropriate subject areas, including- (i) Ethics; (ii) Federal law and regulation pertaining to mortgage origination; (iii) State law and regulation pertaining to mortgage origination; (iv) Federal and State law and regulation, including instruction on fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues. (C) Testing Location. Nothing in this section prohibits a test provider approved by the Nationwide Mortgage Licensing System and Registry from providing a test at the location of the employer of the applicant or the location of any subsidiary or affiliate of the employer of the applicant, or the location of any entity with which the applicant holds an exclusive arrangement to conduct the business of a mortgage loan originator. (D) Minimum Competence. (i) Passing Score. An individual is considered to have passed a qualified written test unless the individual achieves a test score of not less than 75 percent correct answers to questions. (ii) Initial Retests. An individual may retake a test 3 consecutive times with each consecutive taking occurring at least 30 days after the preceding test. (iii) Subsequent Retests. After failing 3 consecutive tests, an individual shall wait at least 6 months before taking the test again. (iv) Retest After Lapse of License. A licensed mortgage loan originator who fails to maintain a valid license for a period of 5 years or longer shall retake the test, not taking into account any time during which such individual is a registered mortgage loan originator. (6) Surety Bond and Net Worth. The applicant has met the surety bond and net worth requirement as required pursuant to subchapter. (A) Surety Bond Required. (i) Coverage, Form and Regulations. Each mortgage loan originator must be covered by a surety bond in accordance with this section. An applicant for an original license or for the renewal of a license shall file a surety bond with each original application and any renewal application for the license. The surety bond must: (a) run to the Government of the Virgin Islands for the benefit of any person who has been damaged by a licensee as a result of violating any law or regulation governing the activities of mortgage loan originators; (b) be issued by a surety company authorized to do business in the Virgin Islands; (c) provide coverage for each mortgage loan originator in an amount as prescribed in subparagraph (A)(ii) of this paragraph; (d) be in a form as prescribed by the Banking Board or its designated agent; (e) be conditioned upon the applicant's complying with all of the Virgin Islands laws regulating the activities of mortgage loan originators, performing all written agreements with borrowers or prospective borrowers and accounting for all funds received by the licensee in conformity with the consistently applied standard system of accounting; and (f) be continuously maintained thereafter for as long any license issued under this chapter remains in force. (ii) Penal Sum of Surety Bond. (a) If an applicant has not conducted business as a mortgage loan originator in the Virgin Islands in any of the three calendar years preceding the year in which an original application for a license is filed, the surety bond required under this subsection is $25,000. (b) If an applicant has conducted business as a mortgage loan originator in the Virgin Islands in any of the three calendar years preceding the year in which an original or renewal application is filed, the applicant shall provide a sworn statement setting forth the total dollar amount of mortgage loans applied for and accepted or mortgage loans applied for, procured, and accepted by the mortgage loan originator during the latest calendar year such business was conducted. The bond required in this circumstance is determined as follows: (I) Where the total dollar amount of stated loans was $1,000,000 or less, the bond is $25,000; (II) Where the total dollar amount of stated loans was more than $1,000,000 but not more than $2,000,000, the bond is $30,000; (III) Where the total dollar amount of stated loans was more than $2,000,000 but not more than $3,000,000, the bond is $40,000; (IV) Where the total dollar amount of stated loans was more than $3,000,000, the bond is $50,000; (iii) Action on Bond. When an action is commenced on a licensee's bond the Banking Board or its designated agent may require the filing of a new bond. (7) New Bond. Immediately upon recovery upon any action on the bond the licensee shall file a new bond; and MINIMUM NET WORTH REQUIRED- (A) Minimum Net Worth. A minimum net worth of $25,000 must be continuously maintained for mortgage loan originators in accordance with this subsection. (i) If the mortgage loan originator is an employee or exclusive agent of a person subject to this subchapter, the net worth of such person subject to this subchapter may be used in lieu of the mortgage loan originator's minimum net worth requirement. (ii) The Banking Board may promulgate rules or regulations with respect to the requirements for minimum net worth as are necessary to accomplish the purposes of this subparagraph. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 282-289.

(a) The minimum standards for license renewal for State-licensed mortgage loan originators must include the following: (1) The mortgage loan originator continues to meet the minimum standards for license issuance under section 385(c)(1)-(6). (2) The mortgage loan originator has satisfied the annual continuing education required in section 385(c)(4)(F). (3) The loan originator has paid all required fees for renewal of the license. (b) Failure to Satisfy Minimum Standards of License Renewal. The license of a mortgage loan originator failing to satisfy the minimum standards for license renewal shall expire. The Banking Board or its designated agent may adopt procedures for the reinstatement of expired licenses consistent with the standards established by the Nationwide Mortgage Licensing System and Registry. (c) Continuing Education for State-Licensed Mortgage Loan Originators. (1) In General. In order to meet the annual continuing education requirements referred to in subsection (a)(2), a licensed mortgage loan originator shall complete at least 8 hours of education approved in accordance with subsection (2) of this section, which shall include at least- (A) 3 hours of Federal law and regulations; (B) 2 hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; and (C) 2 hours of training related to lending standards for the nontraditional mortgage product marketplace. (2) Approved Educational Courses. For purposes of paragraph (1) of this subsection, continuing education courses shaparagraph (1)d, and approved by the Nationwide Mortgage Licensing System and Registry based upon reasonable standards. Review and approval of a continuing education course must include review and approval of the course provider. (3) Approval of Employer and Affiliate Educational Courses. Nothing in this section precludes any education course, as approved by the Nationwide Mortgage Licensing System and Registry, that is provided by the employer of the mortgage loan originator or an entity that is affiliated with the mortgage loan originator or by an agency contract, or any subsidiary or affiliate of such employer or entity. (4) Venue of Education. Continuing education may be offered either in a classroom, online or by any other means approved by the Nationwide Mortgage Licensing System and Registry. (5) Calculation of Continuing Education Credits. A licensed mortgage loan originator- (A) Except for paragraph (2) of this subsection, maparagraph (2)e credit for continuing education course in the year in which the course is taken; and (B) may not take the same approved course in the same or successive years to meet the annual requirements for continuing education. (6) Instructor Credit. A licensed mortgage loan originator who is an approved instructor of an approved continuing education course may receive credit for the licensed mortgage loan originator's own annual continuing education requirement at the rate of 2 hours credit for every 1 hour taught. (7) Reciprocity of Education. A person having successfully completed the education requirements approved by the Nationwide Mortgage Licensing System and Registry in paragraph (1)(A), (Bparagraph (1)(A), (B), and (C)for any state must be accepted as credit towards completion of continuing education requirements in the Virgin Islands. (8) Lapse in License. A licensed mortgage loan originator who subsequently becomes unlicensed must complete the continuing education requirements for the last year in which the license was held prior to issuance of a new or renewed license. (9) Make Up of Continuing Education. A person meeting the requirements of section 386(a)(1) and (3) may make up any deficiency in continuing education as established by rule or regulation of the Banking Board or its designated agent. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 289-291.

(a) In addition to any other duties imposed upon the Banking Board by law, the Banking Board shall require State-licensed mortgage loan originators to be licensed and registered through the Nationwide Mortgage Licensing System and Registry. In order to carry out this requirement the Banking Board or its designated agent may participate in the Nationwide Mortgage Licensing System and Registry. For this purpose, the Banking Board or its designated agent may establish by rules or order requirements as necessary, including but not limited to: (1) Background checks for: (A) Criminal history through fingerprint or other databases; (B) Civil or administrative records; (C) Credit history; or (D) Any other information as deemed necessary by the Nationwide Mortgage Licensing System and Registry. (2) The payment of fees to apply for or renew licenses through the Nationwide Mortgage Licensing System and Registry; (3) The setting or resetting as necessary of renewal or reporting dates; and (4) Requirements for amending or surrendering a license or any other such activities as the Banking Board or its designated agent deems necessary for participation in the Nationwide Mortgage Licensing System and Registry. (b) (1) For the purposes of implementing an orderly and efficient licensing process the Banking Board or its designated agent may establish licensing rules or regulations and interim procedures for licensing and acceptance of applications. For previously registered or licensed individuals the Banking Board or its designated agent may establish expedited review and licensing procedures. (2) In order to fulfill the purposes of this subchapter, the Banking Board or its designated may establish relationships or contracts with the Nationwide Mortgage Licensing System and Registry or other entities designated by the Nationwide Mortgage Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this subchapter. (3) For the purpose of participating in the Nationwide Mortgage Licensing System & Registry, the Banking Board or its designated agent may waive or modify by rule, regulation or order, any requirements of this subchapter to establish new requirements as necessary to participate in the Nationwide Mortgage Licensing System & Registry. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 291, 292.

(a) In order to ensure the effective supervision and enforcement of this subchapter, the Banking Board or its designated agent may: (1) Deny, suspend, revoke, condition or decline to renew a license for a violation of this subchapter, rules or regulations issued under this subchapter or order or directive entered under this subchapter. (2) Deny, suspend, revoke, condition or decline to renew a license if an applicant or licensee fails at any time to meet the requirements of section 385(c) or section 386, or withholds information or makes a material misstatement in an application for a license or renewal of a license. (3) Order restitution against persons subject to this subchapter for violations of this subchapter. (4) Impose fines on persons subject to this subchapter pursuant to subsection (c) of this section. (5) Issue orders or directives under this subchapter as follows: (A) Order or direct persons subject to this subchapter to cease and desist from conducting business, including immediate temporary orders to cease and desist. (B) Order or direct persons subject to this subchapter to cease any harmful activities or violations of this subchapter, including immediate temporary orders to cease and desist. (C) Enter immediate temporary orders to cease business under a license if the Banking Board or its designated agent determines that such license was erroneously granted or the licensee is currently in violation of this subchapter; (D) Order or direct such other affirmative action as the Banking Board deems necessary. (b) The Banking Board or its designated agent may impose a civil penalty on a mortgage loan originator or person subject to this subchapter, if the Banking Board or its designated agent finds, on the record after notice and opportunity for hearing, that such mortgage loan originator or person subject to this subchapter has violated or failed to comply with any requirement of this subchapter or any regulation prescribed by the Banking Board or its designated agent under this subchapter or order issued under authority of this subchapter. (c) The maximum amount of penalty for each act or omission described in subsection (2) of this section shall be $1,000. (d) Each violation or failure to comply with any directive or order of the Banking Board or its designated agent is a separate and distinct violation or failure. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 292, 293.

In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing- (a) Protections. Except as otherwise provided in Public Law 110-289, the requirements under any Federal law or Virgin Islands law regarding the privacy or confidentiality of any information or material provided to the Nationwide Mortgage Licensing System and Registry, and any privilege arising under Federal or State law, including the rules of any Federal or State court, with respect to such information or material, shall continue to apply to such information or material after the information or material has been disclosed to the Nationwide Mortgage Licensing System and Registry. Such information and material may be shared with all State and Federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by Federal law or Virgin Islands public disclosure laws. (b) Agreements and Sharing Arrangements. For these purposes, the Banking Board or it designated agent may enter agreements or sharing arrangements with other governmental agencies, the Conference of State Bank Supervisors, the American Association of Residential Mortgage Regulators or other associations representing governmental agencies as established by rule, regulation or order of the Banking Board or its designated agent. (c) Nonapplicability of Certain Requirements. Information or material that is subject to a privilege or confidentiality under paragraph (1) of this subsection shall not be subject to- (1) Disclosure under any Federal or Virgin Islands law governing the disclosure to the public of information held by an officer or an agency of the Federal Government or the respective State; or (2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Mortgage Licensing System and Registry with respect to such information or material, the person to whom such information or material pertains waives, in whole or in part, in the discretion of such person, that privilege. (d) Coordination With Other Law. Any Virgin Islands law, including any Virgin Islands open record law, relating to the disclosure of confidential supervisory information or any information or material described in subsection (a) of this section which is inconsistent with subsection (a) is superseded by the requirements of this section. (e) Public Access to Information. This section does not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, mortgage loan originators that is included in the Nationwide Mortgage Licensing System and Registry for access by the public. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 294, 295.

In addition to any authority allowed under this subchapter the Banking Board or its designated agent shall have the authority to conduct investigations and examinations as follows: (a) Authority to Access Information. For purposes of initial licensing, license renewal, license suspension, license conditioning, license revocation or termination, or general or specific inquiry or investigation to determine compliance with this subchapter, the Banking Board or its designated agent shall have the authority to access, receive and use any books, accounts, records, files, documents, information or evidence including but not limited to: (1) Criminal, civil and administrative history information, including nonconviction data as specified in Virgin Islands Code; and (2) Personal history and experience information including independent credit reports obtained from a consumer reporting agency described in section 603(p) of the Fair Credit Reporting Act; and (3) Any other documents, information or evidence the Banking Board or its designated agent deems relevant to the inquiry or investigation regardless of the location, possession, control or custody of such documents, information or evidence. (b) Investigation, Examination, and Subpoena Authority. For the purposes of investigating violations or complaints arising under this subchapter, or for the purposes of examination, the Banking Board or its designated agent may review, investigate, or examine any licensee, individual or person subject to this subchapter, as often as necessary in order to carry out the purposes of this subchapter. The Banking Board may direct, subpoena, or order the attendance of and examine under oath all persons whose testimony may be required about the loans or the business or subject matter of any such examination or investigation, and may direct, subpoena, or order such person to produce books, accounts, records, files, and any other documents the Banking Board or its designated agent deems relevant to the inquiry. (c) Availability of Books and Records. Each licensee, individual or person subject to this subchapter shall make available to the Banking Board or its designated agent upon request the books and records relating to the operations of such licensee, individual or person subject to this subchapter. The Banking Board or its designated agent shall have access to such books and records and interview the officers, principals, mortgage loan originators, employees, independent contractors, agents, and customers of the licensee, individual or person subject to this subchapter concerning their business. (d) Reports and Other Information As Directed. Each licensee, individual or person subject to this subchapter shall make or compile reports or prepare other information as directed by the Banking Board or its designated agent in order to carry out the purposes of this section including but not limited to: (1) Accounting compilations; (2) Information lists and data concerning loan transactions in a format prescribed by the Banking Board or its designated agent; or (3) Such other information deemed necessary to carry out the purposes of this section. (e) Control Access to Records. In making any examination or investigation authorized by this subchapter, the Banking Board or its designated agent may control access to any documents and records of the licensee or person under examination or investigation. The Banking Board or its designated agent may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no individual or person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the Banking Board or its designated agent. Unless the Banking Board or its designated agent has reasonable grounds to believe the documents or records of the licensee have been, or are at risk of being altered or destroyed for purposes of concealing a violation of this subchapter, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct its ordinary business affairs. (f) Additional Authority. In order to carry out the purposes of this section, the Banking Board or its designated agent may: (1) Retain attorneys, accountants, or other professionals and specialists as examiners, auditors, or investigators to conduct or assist in the conduct of examinations or investigations; (2) Enter into agreements or relationships with other government officials or regulatory associations in order to improve efficiencies and reduce regulatory burden by sharing resources, standardized or uniform methods or procedures, and documents, records, information or evidence obtained under this section; (3) Use, hire, contract or employ public or privately available analytical systems, methods or software to examine or investigate the licensee, individual or person subject to this subchapter; (4) Accept and rely on examination or investigation reports made by other government officials, within or without this state; or (5) Accept audit reports made by an independent certified public accountant for the licensee, individual or person subject to this subchapter in the course of that part of the examination covering the same general subject matter as the audit and may incorporate the audit report in the report of the examination, report of investigation or other writing of the Examiner. (g) Effect of Authority. The authority of this section shall remain in effect, whether such a licensee, individual or person subject to this subchapter acts or claims to act under any licensing or registration law of this State, or claims to act without such authority. (h) Withhold Records. No licensee, individual or person subject to investigation or examination under this section may knowingly withhold, abstract, remove, mutilate, destroy, or secrete any books, records, computer records, or other information. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 295-297.

That the Banking Board shall have the broad administrative authority to administer, interpret and enforce this subchapter, and promulgate rules or regulations implementing this subchapter, in order to carry out the intentions of the Legislature. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 298.

In addition to those prohibited acts set forth in 9 V.I.C. section 374 governing mortgage lenders and brokers and their employees, it is a violation of this subchapter for a person or individual subject to this subchapter to: (a) Directly or indirectly employ any scheme, device, or artifice to defraud or mislead borrowers or lenders or to defraud any person; (b) Engage in any unfair or deceptive practice toward any person; (c) Obtain property by fraud or misrepresentation; (d) Solicit or enter into a contract with a borrower that provides in substance that the person or individual subject to this subchapter may earn a fee or commission through "best efforts" to obtain a loan even though no loan is actually obtained for the borrower; (e) Solicit, advertise, or enter into a contract for specific interest rates, points, or other financing terms unless the terms are actually available at the time of soliciting, advertising, or contracting; (f) Conduct any business covered by this subchapter without holding a valid license as required under this subchapter, or assist or aide and abet any person in the conduct of business under this subchapter without a valid license as required under this subchapter; (g) Fail to make disclosures as required by this subchapter and any other applicable state or federal law including regulations thereunder; (h) Fail to comply with this subchapter or rules or regulations promulgated under this subchapter, or fail to comply with any other state or federal law, including the rules and regulations thereunder, applicable to any business authorized or conducted under this subchapter; (i) Make, in any manner, any false or deceptive statement or representation including, with regard to the rates, points, or other financing terms or conditions for a residential mortgage loan, or engage in bait and switch advertising; (j) Negligently make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the Nationwide Mortgage Licensing System and Registry or in connection with any investigation conducted by the Banking Board or its designated agent or another governmental agency; (k) Make any payment, threat or promise, directly or indirectly, to any person for the purposes of influencing the independent judgment of the person in connection with a residential mortgage loan, or make any payment threat or promise, directly or indirectly, to any appraiser of a property, for the purposes of influencing the independent judgment of the appraiser with respect to the value of the property; (l) Collect, charge, attempt to collect or charge or use or propose any agreement purporting to collect or charge any fee prohibited by this subchapter; (m) Cause or require a borrower to obtain property insurance coverage in an amount that exceeds the replacement cost of the improvements as established by the property insurer; (n) Fail to truthfully account for monies belonging to a party to a residential mortgage loan transaction. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, pp. 298, 299.

(a) Mortgage Call Reports. Each mortgage licensee shall submit to the Nationwide Mortgage Licensing System and Registry reports of condition, which shall be in such form and shall contain such information as the Nationwide Mortgage Licensing System and Registry may require. (b) Report to Nationwide Mortgage Licensing System and Registry. Subject to Virgin Islands privacy law the Banking Board or its designated agent is required to report regularly violations of this subchapter, as well as enforcement actions and other relevant information, to the Nationwide Mortgage Licensing System and Registry. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 299.

Challenge Process The Banking Board or its designated agent shall establish a process whereby mortgage loan originators may challenge information entered into the Nationwide Mortgage Licensing System and Registry by the Banking Board or its designated agent. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 300.

Non-federally insured credit unions that employ loan originators, as defined in PL 110-289, Title V, the S.A.F.E. Act, shall register such employees with the Nationwide Mortgage Licensing System and Registry by furnishing the information concerning the employees' identity set forth in Section 1507(a) (2) of PL 110-289, Title V. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 300.

If any provision of this subchapter or its application to any person or circumstance is held invalid, the remainder of the subchapter or the application of the provision to other persons or circumstances is not affected. History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 300.

In order to facilitate an orderly transition to licensing and minimize disruption in the mortgage marketplace, the effective date for implementation of this subchapter shall be December 31, 2010, or such later date approved by the Secretary of the United States Department of Housing and Urban Development, pursuant to the authority granted under Public Law 119-289, Section 1508(a). History: Added Nov. 25, 2009, No. 7140, § 1, Sess. L. 2009, p. 300.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

History: Repealed. Sept. 11, 2012, No. 7390, § 2, Sess. L. 2012, p. 230.

This chapter may be cited as the "Uniform Money Services Act". History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 125.

In this chapter: (1) "Alien" means a person incorporated or formed under the laws of a nation other than the United States and not subject to the jurisdiction of the United States. (2) "Applicant" means a person that files an application for a license under this chapter. (3) "Authorized delegate" means a person required to be licensed under this chapter, and who is designated by a licensee to provide money services on behalf of the licensee. (4) "Bank" means an institution organized under federal or state law which: (A) accepts demand deposits or deposits that the depositor may use for payment to third parties and engages in the business of making commercial loans; or (B) engages in credit card operations and maintains only one office that accepts deposits, does not accept demand deposits or deposits that the depositor may use for payments to third parties, does not accept a savings or time deposit less than $100,000, and does not engage in the business of making commercial loans. (5) "Check cashing" means receiving compensation for taking payment instruments or stored value, other than traveler's checks, in exchange for money, payment instruments, or stored value delivered to the person delivering the payment instrument or stored value at the time and place of delivery without an agreement specifying when the person taking the payment instrument will present it for collection. (6) "Control" means: (A) ownership of, or the power to vote, directly or indirectly, at least 25 percent of a class of voting securities or voting interests of a licensee or person in control of a licensee; (B) power to elect a majority of executive officers, managers, directors, trustees, or other persons exercising managerial authority of a licensee or person in control of a licensee; or (C) the power to exercise directly or indirectly, a controlling influence over the management or policies of a licensee or person in control of a licensee. (7) "Currency exchange" means receipt of revenues from the exchange of money of one government for money of another government. (8) "Director" means the Director of the Division of Banking, Insurance and Financial Regulation within the Office of the Lieutenant Governor. (9) "Executive officer" means a president, chairperson of the executive committee, chief financial officer, responsible individual, or other individual who performs similar functions. (10) "Licensee" means a person licensed under this chapter, a money transmission, check cashing or currency exchange business. (11) "Limited station" means private premises where a check casher is authorized to engage in check cashing solely for the employees of the particular employer or group of employers specified in the check casher's license application. (12) "Mobile location" means a vehicle or a movable facility where check cashing occurs. (13) "Monetary value" means a medium of exchange, whether or not redeemable in money. (14) "Money" means a medium of exchange that is authorized or adopted by the United States or a foreign government. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more governments. (15) "Money services" means money transmission, check cashing, or currency exchange. (16) "Money transmission" means selling or issuing payment instruments, stored value, or receiving money or monetary value for transmission. The term does not include the provision solely of delivery, online or telecommunications services, or network access. (17) "Outstanding," with respect to a payment instrument, means issued or sold by or for the licensee and reported as sold but not yet paid by or for the licensee. (18) "Payment instrument" means a check, draft, money order, traveler's check, or other instrument for the transmission or payment of money or monetary value, whether or not negotiable. The term does not include a credit card voucher, letter of credit, or instrument that is redeemable by the issuer in goods or services. (19) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government; governmental subdivision, agency or instrumentality; public corporation; or any other legal or commercial entity. (20) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. (21) "Responsible individual" means an individual who is employed by a licensee and has principal managerial authority over the provision of money services by the licensee in this State. (22) "State" means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. (23) "Stored value" means monetary value that is evidenced by an electronic record. (24) "Unsafe or unsound practice" means a practice or conduct by a person licensed to engage in money transmission or an authorized delegate of such a person which creates the likelihood of material loss, insolvency, or dissipation of the licensee's assets, or otherwise materially prejudices the interests of its customers. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 125; amended Jan. 20, 2017, No. 7962, § 8(1), Sess. L. 2016, p. 311; amended Nov. 10, 2018, No. 8137, § 1(a)-(d), Sess. L. 2018, p. 299.

This chapter does not apply to: (1) the United States or a department, agency, or instrumentality thereof; (2) money transmission by the United States Postal Service or by a contractor on behalf of the United States Postal Service; (3) a state, county, city, or any other governmental agency or governmental subdivision of a State; (4) a bank, bank holding company, office of an international banking corporation, branch of a foreign bank, corporation organized pursuant to the Bank Service Corporation Act, 12 U.S.C. Section1861 - 1867, or corporation organized under the Edge Act, 12 U.S.C. Section611 - 633, under the laws of a State or the United States if it does not issue, sell, or provide payment instruments or stored value through an authorized delegate that is not such a person; (5) electronic funds transfer of governmental benefits for a federal, state, territorial, or governmental agency by a contractor on behalf of the United States or a department, agency, or instrumentality thereof, or a State or governmental subdivision, agency, or instrumentality thereof; (6) a board of trade designated as a contract market under the federal Commodity Exchange Act, 7 U.S.C. Section1 - 25, or a person that, in the ordinary course of business, provides clearance and settlement services for a board of trade to the extent of its operation as or for such a board; (7) a registered futures commission merchant under the federal commodities laws to the extent of its operation as such a merchant; (8) a person that provides clearance or settlement services pursuant to a registration as a clearing agency or an exemption from such registration granted under the federal securities laws to the extent of its operation as such a provider; (9) an operator of a payment system to the extent that it provides processing, clearing, or settlement services, between or among persons excluded by this section, in connection with wire transfers, credit card transactions, debit card transactions, stored-value transactions, automated clearing house transfers, or similar funds transfers; or (10) a person registered as a securities broker-dealer under federal or state securities laws to the extent of its operation as such a broker-dealer. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 127.

(a) A person may not engaged in the business of money transmission or advertise, solicit, or hold itself out as providing money transmission unless the person: (1) is licensed under this subchapter or approved to engage in money transmission under section 517; (2) is an authorized delegate of a person licensed under this subchapter; or (3) is an authorized delegate of a person approved to engage in money transmission under section 517. (b) A license under this subchapter is not transferable or assignable. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 128; amended Mar. 5, 2005, No. 6727, § 20(1), Sess. L. 2005, p. 60.

(a) In this section, "material litigation" means litigation that according to generally accepted accounting principles is significant to an applicant's or a licensee's financial health and would be required to be disclosed in the applicant's or licensee's annual audited financial statements, report to shareholders, or similar records. (b) A person applying for a license under this subchapter shall do so in a form and in a medium prescribed by the Director. The application must state or contain: (1) the legal name and residential and business addresses of the applicant and any fictitious or trade name used by the applicant in conducting its business; (2) a list of any criminal convictions of the applicant and any material litigation in which the applicant has been involved in the 10-year period next preceding the submission of the application; (3) a description of any money services previously provided by the applicant and the money services that the applicant seeks to provide in this State; (4) a list of the applicant's proposed authorized delegates and the locations in this State where the applicant and its authorized delegates propose to engage in money transmission or provide other money services; (5) a list of other States in which the applicant is licensed to engage in money transmission or provide other money services and any license revocations, suspensions, or other disciplinary action taken against the applicant in another State; (6) information concerning any bankruptcy or receivership proceedings affecting the licensee; (7) a sample form of contract for authorized delegates, if applicable, and a sample form of payment instrument or instrument upon which stored value is recorded, if applicable; (8) the name and address of any bank through which the applicant's payment instruments and stored value will be paid; (9) a description of the source of money and credit to be used by the applicant to provide money services; and (10) any other information the Director reasonably requires with respect to the applicant. (c) If an applicant is a corporation, limited liability company, partnership, or other entity, the applicant shall also provide: (1) the date of the applicant's incorporation or formation and State or country of incorporation or formation; (2) if applicable, a certificate of good standing from the State or country in which the applicant is incorporated or formed; (3) a brief description of the structure or organization of the applicant, including any parent or subsidiary of the applicant, and whether any parent or subsidiary is publicly traded; (4) the legal name, any fictitious or trade name, all business and residential addresses, and the employment, in the 10-year period next preceding the submission of the application of each executive officer, manager, director, or person that has control, of the applicant; (5) a list of any criminal convictions and material litigation in which any executive officer, manager, director, or person in control of, the applicant has been involved in the 10-year period next preceding the submission of the application; (6) a copy of the applicant's audited financial statements for the most recent fiscal year and, if available, for the two-year period next preceding the submission of the application; (7) a copy of the applicant's unconsolidated financial statements for the current fiscal year, whether audited or not, and, if available, for the two-year period next preceding the submission of the application; (8) if the applicant is publicly traded, a copy of the most recent report filed with the United States Securities and Exchange Commission under Section 13 of the Federal Section 13 of the Federal Secu15 U.S.C. Section78m193499415 U.S.C. Section1599); (9) if the applicant is a wholly owned subsidiary of: (A) a corporation publicly traded in the United States, a copy of audited financial statements for the parent corporation for the most recent fiscal year or a copy of the parent corporation's most recent report filed under Section 13 of the Federal Securities Exchange Act of 1934, 15 U.S.C. Section78m (1994 and Supp. V, 1999); or (B) a corporation publicly traded outside the United States, a copy of similar documentation filed with the regulator of the parent corporation's domicile outside the United States; (10) if the applicant has a registered agent in this State, the name and address of the applicant's registered agent in this State; and (11) any other information the Director reasonably requires with respect to the applicant. (d) A nonrefundable application fee of $2,000 and a license fee of $2,000 must accompany an application for a license under this subchapter. The license fee must be refunded if the application is denied. (e) The Director may waive one or more requirements of subsections (b) and (c) or permit an applicant to submit other information in lieu of the required information. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 129.

(a) Except as otherwise provided in subsection (b), a surety bond, letter of credit, or other similar security acceptable to the Director in the amount of $50,000 plus $10,000 per location, not exceeding a total addition of $250,000, must accompany an application for a license. (b) Security must be in a form satisfactory to the Director and payable to the State for the benefit of any claimant against the licensee to secure the faithful performance of the obligations of the licensee with respect to money transmission. (c) The aggregate liability on a surety bond may not exceed the principal sum of the bond. A claimant against a licensee may maintain an action on the bond, or the Director may maintain an action on behalf of the claimant. (d) A surety bond must cover claims for so long as the Director specifies, but for at least five years after the licensee ceases to provide money services in this State. However, the Director may permit the amount of security to be reduced or eliminated before the expiration of that time to the extent the amount of the licensee's payment instruments or stored-value obligations outstanding in this State is reduced. The Director may permit a licensee to substitute another form of security acceptable to the Director for the security effective at the time the licensee ceases to provide money services in this State. (e) In lieu of the security prescribed in this section, an applicant for a license or a licensee may provide security in a form prescribed by the Director. (f) The Director may increase the amount of security required to a maximum of $1,000,000 if the financial condition of a licensee so requires, as evidenced by reduction of net worth, financial losses, or other relevant criteria. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 131.

(a) When an application is filed under this subchapter, the Director shall investigate the applicant's financial condition and responsibility, financial and business experience, character, and general fitness. The Director may conduct an on-site investigation of the applicant, the reasonable cost of which the applicant must pay. The Director shall issue a license to an applicant under this subchapter if the Director finds that all of the following conditions have been fulfilled: (1) the applicant has complied with sections 512, 513, and 516; and (2) the financial condition and responsibility, financial and business experience, competence, character, and general fitness of the applicant; and the competence, experience, character, and general fitness of the executive officers, managers, directors, and persons in control of, the applicant indicate that it is in the interest of the public to permit the applicant to engage in money transmission; (b) When an application for an original license under this subchapter is complete, the Director shall promptly notify the applicant in a record of the date on which the application was determined to be complete and: (1) the Director shall approve or deny the application within 120 days after that date; or (2) if the application is not approved or denied within 120 days after that date: (A) the application is approved; and (B) the license under this subchapter, takes effect as of the first business day after expiration of the period. (c) The Director may for good cause extend the application period. (d) An applicant whose application is denied by the Director under this subchapter may appeal, within 30 days after receipt of the notice of the denial, and request a hearing. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 131; amended Mar. 5, 2005, No. 6727, §§ (20)(4)(i)-(iii), Sess. L. 2005, pp. 61, 62.

(a) A licensee under this subchapter shall pay an annual renewal fee of $2,000 no later than 30 days before the anniversary of the issuance of the license or, if the last day is not a business day, on the next business day. (b) A licensee under this subchapter shall submit a renewal report with the renewal fee, in a form and in a medium prescribed by the Director. The renewal report must state or contain: (1) a copy of the licensee's most recent audited annual financial statement or, if the licensee is a wholly owned subsidiary of another corporation, the most recent audited consolidated annual financial statement of the parent corporation or the licensee's most recent audited consolidated annual financial statement; (2) the number and monetary amount of payment instruments and stored-value sold by the licensee in this State which have not been included in a renewal report, and the monetary amount of payment instruments and stored value currently outstanding; (3) a description of each material change in information submitted by the licensee in its original license application which has not been reported to the Director on any required report; (4) a list of the licensee's permissible investments and a certification that the licensee continues to maintain permissible investments according to the requirements set forth in sections 561 and 562; (5) proof that the licensee continues to maintain adequate security as required by section 513; and (6) a list of the locations in this State where the licensee or an authorized delegate of the licensee engages in money transmission or provides other money services. (c) If a licensee does not file a renewal report or pay its renewal fee by the renewal date or any extension of time granted by the Director, the Director shall send the licensee a notice of suspension. Unless the licensee files the report and pays the renewal fee before expiration of 10 days after the notice is sent, the licensee's license is suspended 10 days after the Director sends the notice of suspension. The suspension must be lifted if, within 20 days after its license is suspended, the licensee: (1) files the report and pays the renewal fee; and (2) pays $100 for each day after suspension that the Director did not receive the renewal report and the renewal fee. (d) The Director for good cause may grant an extension of the renewal date. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 132; amended Mar. 5, 2005, No. 6727, § 20(2), Sess. L. 2005, p. 60.

A licensee under this subchapter shall maintain a net worth of at least $100,000 determined in accordance with generally accepted accounting principles. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 133; amended Nov. 10, 2018, No. 8137, § 2, Sess. L. 2018, p. 299.

Elsewhere (a) A person that is licensed to engage in money transmission in at least one other state, with the approval of the Director and in accordance with this section, may engage in money transmission and check [cashing] or currency exchange or both in this state without being licensed pursuant to section 511 if: (1) the state in which the person is licensed has enacted the Uniform MoUniform Money Services Acttransmission laws that are substantially similar to those imposed by the law of the United States Virgin Islands, as determined by the Director; (2) the person submits to the Director: (A) in a record a request for the approval to engage in money transmission and check cashing or currency exchange or both in this state without being licensed pursuant to section 511; (B) a non refundable fee of $1,000; (C) an application form; and (D) a certification of license history. (b) Before granting a person approval to engage in money transmission and check cashing or currency exchange or both in this state without being licensed pursuant to section 511, the Director shall make such considerations, determinations, and findings as required by rule or regulation. (c) When an application for approval under this section is complete, the Director shall notify the applicant in a record of the date on which the request was determined to be complete and: (1) the Director shall approve or deny the request within 120 days after that date; or (2) if the request is not approved or denied within 120 days after that date: (A) the request is approved; and (B) the approval under this section takes effect as of the first business day after expiration of the period. (d) A person that engages in money transmission and check cashing or currency exchange or both in this state pursuant to this section shall comply with the requirements of, and is subject to the sanctions under this chapter as if the person was licensed pursuant to section 511. History: Added Mar. 5, 2005, No. 6727, § 20(3), Sess. L. 2005, pp. 60-61.

(a) Any licensee under this subchapter shall collect a fee of 3% of the gross amount of each money transmission that originates within the Virgin Islands and terminates outside the United States, its territories, consulates, embassies, or military installations. (b) Not later than 10 days after the last day of the calendar month during which the fees are collected, the licensee shall remit the fee to the Virgin Islands Bureau of Internal Revenue ("VIBIR"), on forms provided by the VIBIR. (c) The VIBIR shall charge a late fee of $100 per day for each day that a licensee fails to timely submit the forms and remittances required under this section, unless an extension has been granted. The late fee may not be waived. (d) The VIBIR shall transmit the fees to the Virgin Islands Department of Finance ("DOF") and DOF shall cover all revenues derived from the fees into the Money Transmission Revolving Fund. (e) On a form prescribed by the VIBIR, every licensee, or authorized delegate, shall post a notice advising customers that they are entitled to an income tax credit equal to the amount of the fee paid for the transaction, upon filing an individual income tax return with either a valid social security number, or a valid taxpayer identification number, and a receipt for the transaction including the money transfer number. (f) If a licensee fails to file reports or to remit the fee required by this section, the Director may, pursuant to section 571, suspend the license of the licensee or its delegates. The Director shall send a copy of the of suspension to the Virgin Islands Department of Justice. The licensee may not reapply for a license until all required reports have been filed and all required amounts have been remitted to the VIBIR. (g) Upon request from the Virgin Islands Department of Justice, the Director may make a claim against the surety bond posted by the licensee pursuant to section 513. History: Added Dec. 15, 2024, No. 8936, § 1, Sess. L. 2024, p. -.

(a) There is established in the Treasury of the Government of the Virgin Islands a fund designated as the Money Transmission Revolving Fund ("Fund"). The Commissioner of the Virgin Islands Department of Finance ("Commissioner") shall administer the Fund as a separate and distinct fund in the Treasury of the Virgin Islands, and no amounts in the Fund are available for expenditure or disbursement except as provided in this section. (b) The Fund consists of all sums collected under section 518(a); public or private monetary grants, gifts, donations, bequests, or devises; and all sums the Legislature of the Virgin Islands appropriates to the Fund. (c) Pursuant to title 33 Virgin Islands Code, chapter 117, section 3336, the Commissioner shall deposit the Fund monies into interest-earning accounts, and the earned interest must be deposited into the Fund. (d) To meet the needs, goals, and objectives of the Division of Banking, Insurance and Financial Regulation ("Division") in monitoring and enforcing compliance with Virgin Islands law as it relates to money laundering, electronic transmission of funds, fraud, and related activities, upon authorization of the Division, the Commissioner of Finance shall, upon appropriation of the Legislature of the Virgin Islands, disburse money from the Fund for operating expenses. History: Added Oct. 31, 2024, No. 8936, § 1, Sess. L. 2024, p. -.

Pursuant to title 3 Virgin Islands Code, chapter 35, the Director of the Division of Banking, Insurance and Financial Regulation shall promulgate regulations to effectuate the purpose of this chapter. History: Added Oct. 31, 2024, No. 8936, § 1, Sess. L. 2024, p. -.

(a) A person may not engage in check cashing or advertise, solicit, or hold itself out as providing check cashing for which the person receives at least $500 within a 30-day period unless the person: (1) is licensed under this subchapter; (2) is licensed for money transmission under subchapter 2 or approved to engage in money transmission under section 517; (3) is licensed for currency exchange under subchapter 4; (4) is an authorized delegate of a person licensed under subchapter 2; or (5) is an authorized delegate of a person approved to engage in money transmission under section 517. (b) A license under this subchapter is not transferable or assignable. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 133; amended Mar. 5, 2005, No. 6727, §§ 20(5)(i)-(iii), Sess. L. 2005, p. 62.

(a) A person applying for a license under this subchapter shall do so in a form and in a medium prescribed by the Director. The application must state or contain: (1) the legal name and residential and business addresses of the applicant, if the applicant is an individual or, if the applicant is not an individual, the name of each partner, executive officer, manager, and director; (2) the location of the principal office of the applicant; (3) complete addresses of other locations in this State where the applicant proposes to engage in check cashing or currency exchange, including all limited stations and mobile locations; (4) a description of the source of money and credit to be used by the applicant to engage in check cashing and currency exchange; and (5) other information the Director reasonably requires with respect to the applicant, but not more than the Director may require under subchapter 2. (b) A nonrefundable application fee of $2,000 and a license fee of $2,000 must accompany an application for a license under this subchapter. The license fee must be refunded if the application is denied. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 134.

(a) When an application is filed under this subchapter, the Director shall investigate the applicant's financial condition and responsibility, financial and business experience, character, and general fitness. The Director may conduct an on-site investigation of the applicant, the reasonable cost of which the applicant must pay. The Director shall issue a license to an applicant under this subchapter if the Director finds that all of the following conditions have been fulfilled: (1) the applicant has complied with section 522; and (2) the financial condition and responsibility, financial and business experience, competence, character, and general fitness of the applicant; and the competence, experience, character, and general fitness of the executive officers, managers, directors, and persons in control of, the applicant indicate that it is in the interest of the public to permit the applicant to engage in check cashing. (b) When an application for an original license under this subchapter is complete, the Director shall issue the license under this subchapter, to take effect as of the first business day after expiration of the period. (c) The Director may for good cause extend the application period. (d) An applicant whose application is denied by the Director under this subchapter may appeal, within 30 days after receipt of the notice of the denial, from the denial and request a hearing. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 134.

(a) A licensee under this subchapter shall pay an annual renewal fee of $2,000 no later than 30 days before each annual anniversary of the issuance of the license or, if the last day is not a business day, on the next business day. (b) A licensee under this subchapter shall submit a renewal report with the renewal fee, in a form and in a medium prescribed by the Director. The renewal report must state or contain: (1) a description of each material change in information submitted by the licensee in its original license application that has not been reported to the Director on any required report; and (2) a list of the locations in this State where the licensee or an authorized delegate of the licensee engages in check cashing or currency exchange, including limited stations and mobile locations. (c) If a licensee does not file a renewal report or pay its renewal fee by the renewal date or any extension of time granted by the Director, the Director shall send the licensee a notice of suspension. Unless the licensee files the report and pays the renewal fee before expiration of 10 days after the notice is sent, the licensee's license is suspended 10 days after the Director sends the notice of suspension. (d) The Director for good cause may grant an extension of the renewal date. The suspension must be lifted if, within 20 days after its license is suspended, the licensee: (1) files the report and pays the renewal fee; and (2) pays $100 for each day after suspension that the Director did not receive the renewal report and the renewal fee. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 135; amended Oct. 6, 2019, No. 8210, § 1, Sess. L. 2019, p. 87.

(a) A person may not engage in currency exchange or advertise, solicit, or hold itself out as providing currency exchange for which the person receives revenues equal or greater than five percent of total revenues unless the person (1) is licensed under this subchapter; (2) is licensed for money transmission under subchapter 2 of this chapter or approved to engage in money transmission under section 517; (3) is licensed for check cashing under subchapter 3 of this chapter; (4) is an authorized delegate of a person licensed under subchapter 2 of this chapter; or (5) is an authorized delegate of a person approved to engage in money transmission under section 517. (b) A license under this subchapter under this chapter is not transferable or assignable. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 135; amended Mar. 5, 2005, No. 6727, § 20(5)(i)-(iii).

(a) A person applying for a license under this subchapter under this chapter shall do so in a form and in a medium prescribed by the Director. The application must state or contain: (1) the legal name and residential and business addresses of the applicant, if the applicant is an individual or, if the applicant is not an individual, the name of each partner, executive officer, manager, and director; (2) the location of the principal office of the applicant; (3) complete addresses of other locations in this State where the applicant proposes to engage in currency exchange or check cashing, including all limited stations and mobile locations; (4) a description of the source of money and credit to be used by the applicant to engage in check cashing and currency exchange; and (5) other information the Director reasonably requires with respect to the applicant, but not more than the Director may require under subchapter 2. (b) A nonrefundable application fee of $2,000 and a license fee of $2,000 must accompany an application for a license under this subchapter. The license fee must be refunded if the application is denied. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 136.

(a) When an application under this subchapter, the Director shall investigate the applicant's financial condition and responsibility, financial and business experience, character, and general fitness. The Director may conduct an on-site investigation of the applicant, the reasonable cost of which the applicant must pay. The Director shall issue a license to an applicant under this subchapter if the Director finds that all of the following conditions have been fulfilled: (1) the applicant has complied with section 532; and (2) the financial condition and responsibility, financial and business experience, competence, character, and general fitness of the applicant; and the competence, experience, character, and general fitness of the executive officers, managers, directors, and persons in control of, the applicant indicate that it is in the interest of the public to permit the applicant to engage in currency exchange. (b) When an application for an original license under this subchapter is complete, the Director shall promptly notify the applicant in a record of the date on which the application was determined to be complete and: (1) the Director shall approve or deny the application within 120 days after that date; or (2) if the application is not approved or denied within 120 days after that date: (A) the application is deemed approved; and (B) the Director shall issue the license under this subchapter, to take effect as of the first business day after expiration of the period. (c) The Director may for good cause extend the application period. (d) An applicant whose application is denied a license by the Director under this subchapter may appeal, within 30 days after receipt of the notice of the denial, from the denial and request a hearing. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 136.

(a) A licensee under this subchapter shall pay an annual renewal fee of $2,000 no later than 30 days before each annual anniversary of the issuance of the license or, if the last day is not a business day, on the next business day. (b) A licensee under this subchapter shall submit a renewal report with the renewal fee, in a form and in a medium prescribed by the Director. The renewal report must state or contain: (1) a description of each material change in information submitted by the licensee in its original license application that has not been reported to the Director on any required report; and (2) a list of the locations in this State where the licensee or an authorized delegate of the licensee engages in currency exchange or check cashing, including limited stations and mobile locations. (c) If a licensee does not file a renewal report and pay its renewal fee by the renewal date or any extension of time granted by the Director, the Director shall send the licensee a notice of suspension. Unless the licensee files the report and pays the renewal fee before expiration of 10 days after the notice is sent, the licensee's license is suspended 10 days after the Director sends the notice of suspension. (d) The Director for good cause may grant an extension of the renewal date. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 137; amended Oct. 6, 2019, No. 8210, § 1, Sess. L. 2019, p. 87.

(a) In this section, "remit" means to make direct payments of money to a licensee or its representative authorized to receive money or to deposit money in a bank in an account specified by the licensee. (b) A contract between a licensee and an authorized delegate must require the authorized delegate to operate in full compliance with this chapter. The licensee shall furnish in a record to each authorized delegate policies and procedures sufficient for compliance with this chapter. (c) An authorized delegate shall remit all money owing to the licensee in accordance with the terms of the contract between the licensee and the authorized delegate. (d) If a license is suspended or revoked or a licensee does not renew its license, the Director shall notify all authorized delegates of the licensee whose names are in a record filed with the Director of the suspension, revocation, or non-renewal. After notice is sent or publication is made, an authorized delegate shall immediately cease to provide money services as a delegate of the licensee. (e) An authorized delegate may not provide money services outside the scope of activity permissible under the contract between the authorized delegate and the licensee, except activity in which the authorized delegate is authorized to engage under subchapter 2, 3, or 4. An authorized delegate of a licensee holds in trust for the benefit of the licensee all money net of fees received from money transmission. (f) An authorized delegate may not use subdelegates to conduct money services on behalf of a licensee. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 138; amended Mar. 5, 2005, No. 6727, § 20(6), Sess. L. 2005, p. 62.

A person may not provide money services on behalf of a person not licensed under this chapter. A person that engages in that activity provides money services to the same extent as if the person were a licensee. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 138.

(a) A person may not engage in authorized delegate activities or advertise, solicit, or hold itself out as serving as an authorized delegate for a money transmission check cashing or currency exchange for which the person receives revenues equal or greater than five percent of total revenues unless the person meets one of the criteria in paragraphs (1) through (3) of this subsection. The person must be: (1) licensed under this subchapter; (2) an authorized delegate of a person licensed under subchapter II of this chapter; or (3) an authorized delegate of a person approved to Engage in money transmission under section 517. (b) A license under this subchapter is not transferable or assignable. History: Added Nov. 10, 2018, No. 8137, § 3(b), Sess. L. 2018, p. 299, 300.

(a) A person applying for a license under this subchapter shall do so in a form and in a medium prescribed by the Director. The application must contain: (1) the legal name and residential and business addresses of the applicant, if the applicant is an individual; or, if the applicant is not an individual, the legal name including any fictitious or trade name and business address of the applicant and the legal name of each partner, executive officer, manager, and director; (2) the location of the principal office of the applicant; (3) complete addresses of other locations in this Territory where the applicant engages in money transmission, check cashing or currency exchange, including all limited stations and mobile locations; (4) a description of the source of money and credit to be used by the applicant to engage as an authorized delegate for money transmission, check cashing and currency exchange; and (5) other information the Director reasonably requires with respect to the applicant, but not more than the Director may require under subchapter II. (b) A non-refundable application fee of $200 and a license fee of $450 must accompany (c) an application for a license under this subchapter. The license fee must be refunded if the application is denied. History: Added Nov. 10, 2018, No. 8137, § 3(b), Sess. L. 2018, p. 300.

(a) When an application is filed under this subchapter, the Director shall investigate the applicant's financial condition and responsibility, financial and business experience, character, and general fitness. The Director shall conduct an on-site investigation of the applicant, the reasonable cost of which the applicant must pay. The Director shall issue a license to an applicant under this subchapter if the Director finds that: (1) the applicant has complied with § 538; and (2) the financial condition and responsibility, financial and business experience, competence, character, and general fitness of the applicant; and the competence, experience, character, and general fitness of the executive officers, managers, directors, and persons in control of, the applicant indicate that it is in the interest of the public to permit the applicant to act as an authorized delegate on behalf of a licensee. (b) When an application for an original license under this subchapter is complete, the Director shall issue the license under this subchapter. (c) The Director may for good cause extend the application period. (d) An applicant whose application is denied by the Director under this subchapter may appeal from the denial and request a hearing, no later than 30 days after receipt of the notice of denial. History: Added Nov. 10, 2018, No. 8137, § 3(b), Sess. L. 2018, p. 300, 301.

(a) An authorized delegate licensed under this subchapter shall pay an annual renewal fee of $450 no later than 30 days before each annual anniversary of the issuance of the license or, if the last day is not a business day, on the next business day. (b) An authorized delegate licensed under this subchapter shall submit a renewal report with the renewal fee, in a form and in a medium prescribed by the Director. The renewal report must state or contain: (1) a description of each material change in information submitted by the authorized delegate in its original license application that has not been reported to the Director on any required report; and (2) a list of the locations in this Territory where the authorized delegate engages in money transmission, check cashing or currency exchange, including limited stations and mobile locations. (c) If an authorized delegate licensed under this subchapter does not file a renewal report or pay the renewal fee by the renewal date or any extension of time granted by the Director, the Director shall send the authorized delegate a notice of suspension. Unless the authorized delegate files the report and pays the renewal fee before expiration of 10 days after the notice is sent, the Director shall suspend the authorized delegate's license 10 days after the Director sends the notice of suspension. (d) The Director for good cause may grant an extension of the renewal date. The suspension must be lifted if, within 20 days after its license is suspended, the authorized delegate: (1) files the report and pays the renewal fee; and (2) pays $100 for each day after suspension that the Director did not receive the renewal report and the renewal fee. History: Added Nov. 10, 2018, No. 8137, § 3(b), Sess. L. 2018, p. 301; amended Oct. 6, 2019, No. 8210, § 1, Sess. L. 2019, p. 87.

(a) The Director may conduct an annual examination of a licensee or of any of its authorized delegates upon 45 days' notice in a record to the licensee. (b) The Director may examine a licensee or its authorized delegate, at any time, without notice, if the Director has reason to believe that the licensee or authorized delegate is engaging in an unsafe or unsound practice or has violated or is violating this chapter or a rule adopted or an order issued under this chapter. (c) If the Director concludes that an on-site examination is necessary under subsection (a), the licensee shall pay the reasonable cost of the examination. (d) Information obtained during an examination under this chapter may be disclosed only as provided in section 557. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 138.

The Director may consult and cooperate with other state money services regulators in enforcing and administering this chapter. They may jointly pursue examinations and take such other official action that they are otherwise empowered to take. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 139; amended Mar. 5, 2005, No. 6727, § 20(7), Sess. L. 2005, p. 62.

(a) A licensee shall file with the Director within 15 business days any material changes in information provided in a licensee's application as prescribed by the Director. (b) A licensee shall file with the Director within 45 days after the end of each fiscal quarter a current list of all authorized delegates, and locations in this State where the licensee or an authorized delegate of the licensee provides money services, including limited stations and mobile locations. The licensee shall state the name and street address of each location and authorized delegate. (c) A licensee shall file a report with the Director within one business day after the licensee has reason to know of the occurrence any of the following events: (1) the filing of a petition by or against the licensee under the United States Bankruptcy Code, 11 U.S.C. Section101 - 110, for bankruptcy o11 U.S.C. Section11n; (2) the filing of a petition by or against the licensee for receivership, the commencement of any other judicial or administrative proceeding for its dissolution or reorganization, or the making of a general assignment for the benefit of its creditors; (3) the commencement of a proceeding to revoke or suspend its license in a State or country in which the licensee engages in business or is licensed; (4) the cancellation or other impairment of the licensee's bond or other security; (5) a charge or conviction of the licensee or of an executive officer, manager, director, or person in control of, the licensee for a felony; or (6) a charge or conviction of an authorized delegate for a felony. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 139; amended Mar. 5, 2005, No. 6727, § 20(8), (9), Sess. L. 2005, p. 62.

(a) A licensee shall: (1) give the Director notice in a record of a proposed change of control within 15 days after learning of the proposed change of control; (2) request approval of the acquisition; and (3) submit a nonrefundable fee of $2,000 with the notice. (b) After review of a request for approval under subsection (a), the Director may require the licensee to provide additional information concerning the proposed persons in control of the licensee. The additional information must be limited to the same types required of the licensee or persons in control of the licensee as part of its original license or renewal application. (c) The Director shall approve a request for change of control under subsection (a) if, after investigation, the Director determines that the person or group of persons requesting approval has the competence, experience, character, and general fitness to operate the licensee or person in control of the licensee in a lawful and proper manner and that the public interest will not be jeopardized by the change of control. (d) When an application for a change of control under this subchapter is complete, the Director shall notify the licensee in a record of the date on which the request was determined to be complete and: (1) the Director shall approve or deny the request within 120 days after that date; or (2) if the request is not approved or denied within 120 days after that date: (A) the request is deemed approved; and (B) the Director shall permit the change of control under this section, to take effect as of the first business day after expiration of the period. (e) The Director, by rule of order, may exempt a person from any of the requirements of subsections (a)(2) and (3) if it is in the public interest to do so. (f) Subsection (a) does not apply to a public offering of securities. (g) Before filing a request for approval to acquire control of a licensee or person in control of a licensee, a person may request in a record a determination from the Director as to whether the person would be considered a person in control of a licensee upon consummation of a proposed transaction. If the Director determines that the person would not be a person in control of a licensee, the Director shall enter an order to that effect and the proposed person and transaction is not subject to the requirements of subsections (a) through (c). History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 140.

(a) A licensee shall maintain the following records for determining its compliance with this chapter for at least three years: (1) record of each payment instrument or stored-value obligation sold; (2) a general ledger posted at least monthly containing all asset, liability, capital, income, and expense accounts; (3) bank statements and bank reconciliation records; (4) records of outstanding payment instruments and stored-value obligations; (5) records of each payment instrument and stored-value obligation paid within the three-year period; (6) a list of the last known names and addresses of all of the licensee's authorized delegates; and (7) any other records the Director reasonably requires by rule. (b) The items specified in subsection (a) may be maintained in any form of record. (c) Records may be maintained outside this State if they are made accessible to the Director on seven business-days' notice that is sent in a record. (d) All records maintained by the licensee as required in subsections (a) through (c) are open to inspection by the Director pursuant to Section 551. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 141.

(a) A licensee and an authorized delegate shall file with the Attorney General all reports required by federal currency reporting, record keeping, and suspicious transaction reporting requirements as set forth in 31 U.S.C. Section5311, 31 C.F.R Section 103, and other federal and state laws pertaining to money laundering. (b) The timely filing of a complete and accurate report required under subsection (a) with the appropriate federal agency is compliance with the requirements of subsection (a), unless the Director notifies the licensee that the Attorney General has notified the Director that reports of this type are not being regularly and comprehensively transmitted by the federal agency to the Attorney General. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 141.

(a) Except as otherwise provided in subsection (b), all information or reports obtained by the Director from an applicant, licensee, or authorized delegate and all information contained in or related to examination, investigation, operating, or condition reports prepared by, on behalf of, or for the use of the Director, or financial statements, balance sheets, or authorized delegate information, are confidential and are not subject to disclosure under title 3 Virgin Islands Code, chapter 33, as amended. (b) The Director may disclose information not otherwise subject to disclosure under subsection (a) to representatives of state or federal agencies who promise in a record that they will maintain the confidentiality of the information; or the Director finds that the release is reasonably necessary for the protection of the public and in the interests of justice, and the licensee has been given previous notice by the Director of its intent to release the information. (c) This section does not prohibit the Director from disclosing to the public a list of persons licensed under this chapter or the aggregated financial data concerning those licensees. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 142; amended Mar. 5, 2005, No. 6727, § 20(10), Sess. L. 2005, p. 62.

(a) A licensee shall maintain at all times permissible investments that have a market value computed in accordance with generally accepted accounting principles of not less than the aggregate amount of all of its outstanding payment instruments and stored value obligations issued or sold in all states and money transmitted from all states by the licensee. (b) The Director, with respect to any licensees, may limit the extent to which a type of investment within a class of permissible investments may be considered a permissible investment, except for money and certificates of deposit issued by a bank. The Director by rule may prescribe or by order allow other types of investments that the Director determines to have a safety substantially equivalent to other permissible investments. (c) Permissible investments, even if commingled with other assets of the licensee, are held in trust for the benefit of the purchasers and holders of the licensee's outstanding payment instruments and stored value obligations in the event of bankruptcy or receivership of the licensee. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 142; amended Mar. 5, 2005, No. 6727, § 20(12), Sess. L. 2005, p. 63.

(a) Except to the extent otherwise limited by the Director pursuant to section 561, the following investments are permissible under section 561: (1) cash, a certificate of deposit, or senior debt obligation of an insured depositary institution, as defined in Section 3 of the Federal Deposit Insurance Act, (12 U.S.C. Section1813); (2) banker's 12 U.S.C. Section12of exchange that is eligible for purchase upon endorsement by a member bank of the Federal Reserve System and is eligible for purchase by a Federal Reserve Bank; (3) an investment bearing a rating of one of the three highest grades as defined by a nationally recognized organization that rates securities; (4) an investment security that is an obligation of the United States or a department, agency, or instrumentality thereof; an investment in an obligation that is guaranteed fully as to principal and interest by the United States; or an investment in an obligation of a State or a governmental subdivision, agency, or instrumentality thereof; (5) receivables that are payable to a licensee from its authorized delegates, in the ordinary course of business, pursuant to contracts which are not past due or doubtful of collection if the aggregate amount of receivables under this paragraph does not exceed 20 percent of the total permissible investments of a licensee and the licensee does not hold at one time receivables under this paragraph in any one person aggregating more than 10 percent of the licensee's total permissible investments; and (6) a share or a certificate issued by an open-end management investment company that is registered with the United States Securities and Exchange Commission under the Investment Companies Act of 1940, ( 15 U.S.C. Section 80a- 1 - 64, and whose portfolio is restricted by the management company's investment policy to investments specified in paragraphs (1) through (4). (b) The following investments are permissible under section 561, but only to the extent specified: (1) an interest-bearing bill, note, bond, or debenture of a person whose equity shares are traded on a national securities exchange or on a national over-the-counter market, if the aggregate of investments under this paragraph does not exceed 20 percent of the total permissible investments of a licensee and the licensee does not at one time hold investments under this paragraph in any one person aggregating more than 10 percent of the licensee's total permissible investments; (2) a share of a person traded on a national securities exchange or a national over-the-counter market or a share or a certificate issued by an open-end management investment company that is registered with the United States Securities and Exchange Commission under the Investment CompaniesInvestment Companies Act of 1940 8015 1.C.64tion 80a- 9e portfolio is restricted by the management company's investment policy to shares of a person traded on a national securities exchange or a national over-the-counter market, if the aggregate of investments under this paragraph does not exceed 20 percent of the total permissible investments of a licensee and the licensee does not at one time hold investments in any one person aggregating more than 10 percent of the licensee's total permissible investments; (3) a demand-borrowing agreement made to a corporation or a subsidiary of a corporation whose securities are traded on a national securities exchange if the aggregate of the amount of principal and interest outstanding under demand-borrowing agreements under this paragraph does not exceed 20 percent of the total permissible investments of a licensee and the licensee does not at one tine hold principal and interest outstanding under demand-borrowing agreements under this paragraph with any one person aggregating more than 10 percent of the licensee's total permissible investments; and (4) any other investment the Director designates, to the extent specified by the Director. (c) The aggregate of investments under subsection (b) may not exceed 50 percent of the total permissible investments of a licensee in accordance with section 561. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 142.

(a) The Director may suspend or revoke a license, place a licensee in receivership, or order a licensee to revoke the designation of an authorized delegate if: (1) the licensee violates this chapter or a rule adopted or an order issued under this chapter; (2) the licensee does not cooperate with an examination or investigation by the Director; (3) the licensee engages in fraud, intentional misrepresentation, or gross negligence; (4) an authorized delegate is convicted of a violation of a state or federal anti-money laundering statute, or violates a rule adopted or an order issued under this chapter, as a result of the licensee's willful misconduct or willful blindness; (5) the competence, experience, character, or general fitness of the licensee, authorized delegate, person in control of a licensee, or responsible person of the licensee or authorized delegate indicates that it is not in the public interest to permit the person to provide money services; (6) the licensee engages in an unsafe or unsound practice; (7) the licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors; or (8) the licensee does not remove an authorized delegate after the Director issues and serves upon the licensee a final order including a finding that the authorized delegate has violated this chapter. (b) In determining whether a licensee is engaging in an unsafe or unsound practice, the Director may consider the size and condition of the licensee's money transmission, the magnitude of the loss, the gravity of the violation of this chapter, and the previous conduct of the person involved. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 144.

(a) The Director may issue an order suspending or revoking the license and designation of an authorized delegate, if the Director finds that: (1) the authorized delegate violated this chapter or a rule adopted or an order issued under this chapter; (2) the authorized delegate did not cooperate with an examination or investigation by the Director; (3) the authorized delegate engaged in fraud, intentional misrepresentation, or gross negligence; (4) the authorized delegate is convicted of a violation of a state or federal anti-money laundering statute; (5) the competence, experience, character, or general fitness of the authorized delegate or a person in control of the authorized delegate indicates that it is not in the public interest to permit the authorized delegate to provide money services; or (6) the authorized delegate is engaging in an unsafe or unsound practice. (b) determining whether an authorized delegate is engaging in an unsafe or unsound practice, the Director may consider the size and condition of the authorize delegate's provision of money services, the magnitude of the loss, the gravity of the violation of this chapter or a rule adopted or order issued under this chapter, and the previous conduct of the authorized delegate. (c) An authorized delegate may apply for relief from a suspension or revocation of designation as an authorized delegate according to procedures prescribed by the Director. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 145; amended Nov. 10, 2018, No. 8137, § 4, Sess. L. 2018, p. 302.

(a) If the Director determines that a violation of this chapter or of a rule adopted or an order issued under this chapter by a licensee or authorized delegate is likely to cause immediate and irreparable harm to the licensee, its customers, or the public as a result of the violation, or cause insolvency or significant dissipation of assets of the licensee, the Director may issue an order requiring the licensee or authorized delegate to cease and desist from the violation. The order becomes effective upon service of it upon the licensee or authorized delegate. (b) The Director may issue an order against a licensee to cease and desist from providing money services through an authorized delegate that is the subject of a separate order by the Director. (c) An order to cease and desist remains effective and enforceable pending the completion of an administrative proceeding pursuant to section 571 or 572. (d) A licensee or an authorized delegate that is served with an order to cease and desist may petition the Superior Court of the United States Virgin Islands, or the District Court for the District of the United States Virgin Islands, for a judicial order setting aside, limiting, or suspending the enforcement, operation, or effectiveness of the order pending the completion of an administrative proceeding pursuant to section 571 or 572. (e) An order to cease and desist expires unless the Director commences an administrative proceeding pursuant to section 571 or 572 within 10 days after it is issued. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 145.

The Director may enter into a consent order at any time with a person to resolve a matter arising under this chapter or a rule adopted or order issued under this chapter. A consent order must be signed by the person to whom it is issued or by the person's authorized representative, and must indicate agreement with the terms contained in the order. A consent order may provide that it does not constitute an admission by a person that this chapter or a rule adopted or an order issued under this chapter has been violated. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 146.

The Director may assess a civil penalty against a person that violates this chapter or a rule adopted or an order issued under this chapter in an amount not to exceed $1,000 per day for each day the violation is outstanding, plus the State's costs and expenses for the investigation and prosecution of the matter, including reasonable attorney's fees. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 146.

(a) A person that intentionally makes a false statement, misrepresentation, or false certification in a record filed or required to be maintained under this chapter or that intentionally makes a false entry or omits a material entry in such a record is guilty of a felony. (b) A person that knowingly engages in an activity for which a license is required under this chapter without being licensed under this chapter and who receives more than $500 in compensation within a 30- day period from this activity is guilty of a felony. (c) A person that knowingly engages in an activity for which a license is required under this chapter without being licensed under this chapter and who receives no more than $500 in compensation within a 30-day period from this activity is guilty of a misdemeanor. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 146.

(a) If the Director has reason to believe that a person has violated or is violating section 511, 521, or 531 the Director may issue an order to show cause why an order to cease and desist should not issue requiring that the person cease and desist from the violation. (b) In an emergency, the Director may petition the Superior Court of the United States Virgin Islands for the issuance of a temporary restraining order ex parte pursuant to the rules of civil procedure. (c) An order to cease and desist becomes effective upon service of it upon the person. (d) An order to cease and desist remains effective and enforceable pending the completion of an administrative proceeding pursuant to sections 581 and 582. (e) A person that is served with an order to cease and desist for violating section 511, 521, or 531 may petition the Superior Court of the United States Virgin Islands or the District Court of the United States Virgin Islands for a judicial order setting aside, limiting, or suspending the enforcement, operation, or effectiveness of the order pending the completion of an administrative proceeding pursuant to sections 581 and 582. (f) An order to cease and desist expires unless the Director commences an administrative proceeding within 10 days after it is issued. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 147.

All administrative proceedings under this chapter must be conducted in accordance with rules and regulations adopted in compliance with Title 3, Chapter 35, Virgin Islands Code. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 147.

Except as otherwise provided in sections 515(c), 524(c), 534(c), 513, and 577, the Director may not suspend or revoke a license, place a licensee in receivership, issue an order to cease and desist, suspend or revoke the designation of an authorized delegate, or assess a civil penalty without notice and an opportunity to be heard. The Director shall also hold a hearing when requested to do so by an applicant whose application for a license is denied. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 147.

Any rule or regulation promulgated under this chapter, or any decision of the Director under this chapter, may be appealed to the Superior Court of the United States Virgin Islands or the District Court for the United States Virgin Islands, by filing such appeal within sixty (60) days of the final issuance of such rule, regulation, or decision. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 148.

In applying and construing this Uniform Act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among States that enact it. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 148.

If any provision of this Act or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this chapter which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable. History: Added Aug. 12, 2004, No. 6678, § 2, Sess. L. 2004, p. 148.

Chapter No alien company, as defined in new section 502(1), may be licensed to conduct money services business under this chapter. An alien company seeking to conduct business under this chapter may conduct business only through a United States subsidiary. The United States subsidiary shall comply with all applicable provisions of this chapter. History: Added Nov. 10, 2018, No. 8137, § 5, Sess. L. 2018, p. 302.

This chapter may be cited as the "Uniform Securities Act." History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 66.

In this chapter, unless the context otherwise requires: (1) "Administrator" means the Lieutenant Governor or his designee. (2) "Agent" means an individual, other than a broker-dealer, who represents a broker-dealer in effecting or attempting to effect purchases or sales of securities or represents an issuer in effecting or attempting to effect purchases or sales of the issuer's securities, but a partner, officer, or director of a broker-dealer or issuer, or an individual having a similar status or performing similar functions, is an agent only if the individual otherwise comes within the term. The term does not include an individual excluded by rule or order under this chapter. (3) "Bank" means: (A) a banking institution organized under the laws of the United States; (B) a member bank of the Federal Reserve System; (C) any other banking institution whether incorporated or not, doing business under the laws of a State or of the United States, a substantial portion of the business of which consists of receiving deposits or exercising fiduciary powers similar to those permitted to be exercised by national banks under the authority of the Comptroller of the Currency pursuant to Section 1 of Public Law 87-722 (12 U.S.C. Section92a), and that is supervised and examined by a state or federal agency having supervision over banks, and that is not operated for the purpose of evading this chapter; and (D) a receiver, conservator, or other liquidating agent of any institution or firm included in subparagraphs (A), (B), or (C). (4) "Broker-dealer" means a person engaged in the business of effecting transactions in securities for the account of others or for the person's own account. The term does not include: (A) an agent; (B) an issuer; (C) a bank or savings institution if its activities as a broker-dealer are limited to those specified in subsections 3(a)(4)(B)(i) through (vi), (viii) through (x), and (xi) if limited to unsolicited transactions, 3(a)(5)(B); and 3(a)(5)(C) of the Securities Exchange Act of 1934 (15 U.S.C. Sections78c(a)(4) and (5)) or the bank satisfies the conditions described in subsection 3(a)(4)(E) of the Securities Exchange Act of 1934 (15 U.S.C. Section78c(a)(4)); (D) an international banking institution; or (E) a person excluded by rule or order under this chapter; (5) "Depository institution" means: (A) a bank; or (B) a savings institution, trust company, credit union, or similar institution that is organized or chartered under the laws of a State or of the United States, authorized to receive deposits, and supervised and examined by an official or agency of a State or the United States if its deposits or share accounts are insured to the maximum amount authorized by statute by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund, or a successor authorized by federal law. The term does not include: (i) an insurance company or other organization primarily engaged in the business of insurance; (ii) a Morris Plan bank; or (iii) an industrial loan company. (6) "Federal covered investment adviser" means a person registered under the Investment Advisers Act of 1940. (7) "Federal covered security" means a security that is, or upon completion of a transaction will be, a covered security under Section 18(b) of the Securities Act of 1933 (15 U.S.C. Section77r(b)) or rules or regulations adopted under that provision. (8) "Filing" means the receipt under this chapter of a record by the Administrator or a designee of the Administrator. (9) "Fraud," "deceit," and "defraud" include, but are not limited to, common law deceit. (10) "Guaranteed" means guaranteed as to payment of all principal and all interest. (11) "Institutional investor" means any of the following, whether acting for itself or for others in a fiduciary capacity: (A) a depository institution or international banking institution; (B) an insurance company; (C) a separate account of an insurance company; (D) an investment company as defined in the Investment Company Act of 1940; (E) a broker-dealer registered under the Securities Exchange Act of 1934; (F) an employee pension, profit-sharing, or benefit plan if the plaSecurities Exchange Act of 1934 $10,000,000 or its investment decisions are made by a named fiduciary, as defined in the Employee Retirement Income Security Act of 1974, that is a broker-dealer registered under the SecuriEmployee Retirement Income Security Act of 1974r registered or exempt from registration under Securities Exchange Act of 19341940, an investment adviser registered under this chapter, a depository iInvestment Advisers Act of 1940pany; (G) a plan established and maintained by a State, a political subdivision of a State, or an agency or instrumentality of a State or a political subdivision of a State for the benefit of its employees, if the plan has total assets in excess of $10,000,000 or its investment decisions are made by a duly designated public official or by a named fiduciary, as defined in the Employee Retirement Income Security Act of 1974, that is a broker-dealer registered under Employee Retirement Income Security Act of 1974ent adviser registered or exempt from registratSecurities Exchange Act of 1934rs Act of 1940, an investment adviser registered under this chapter, a deInvestment Advisers Act of 1940urance company; (H) a trust, if it has total assets in excess of $10,000,000, its trustee is a depository institution, and its participants are exclusively plans of the types identified in subparagraph (F) or (G), regardless of size of assets, except a trust that includes as participants self-directed individual retirement accounts or similar self-directed plans; (I) an organization described in Section 501(c)(3) of the Internal Revenue Code (26 U.S.C. Section501(c)(3))501(c)(3) of the Internal Revenue Codend26 U.S.C. Section26s trust, limited liability company, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $10,000,000; (J) a small business investment company licensed by the Small Business Administration under Section 301(c) of the Small Business Investment Act of 1958 (15 U.S.C. Section681(c)) with total assets in excess of $10,000,000; (K) a private business development company as defined in Section 612(a)(22) of the Investment Advisers Act of 1940 615 U.S.C. §80b-2(a)(22)t Advisers Act of 1940 e15 U.S.C. §15000,000; (L) a federal covered investment adviser acting for its own account; (M) a "qualified institutional buyer" as defined in Rule 144A(a)(1), other than RuRule 144A(a)(1)), adopted unRule 144A(a)(1)(H) Act of 1933; (N) a "major U.S. institutional investor" as defined in Rule 15a-6(b)(4)(i) Rule 15a-6(b)(4)(i)ecurities Exchange Act of 1934; (O) any other person other than an individual of institutional character with total assets in excess of $10,000,000 not organized for the specific purpose of evading this chapter; or (P) any other person specified by rule or order under this chapter. (12) "Insurance company" means a company organized as an insurance company whose primary business is writing insurance or reinsuring risks underwritten by insurance companies and which is subject to supervision by the insurance commissioner or a similar official or agency of a State. (13) "Insured" means insured as to payment of all principal and all interest. (14) "International banking institution" means an international financial institution of which the United States is a member and whose securities are exempt from registration under the Securities Act of 1933. (15) "Investment adviser" means a person that, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or the advisability of investing in, purchasing, or selling securities or that, for compensation and as a part of a regular business, issues or promulgates analyses or reports concerning securities. The term includes a financial planner or other person that, as an integral component of other financially related services, provides investment advice to others for compensation as part of a business or that holds itself out as providing investment advice to others for compensation. The term does not include: (A) an investment adviser representative; (B) a lawyer, accountant, engineer, or teacher whose performance of investment advice is solely incidental to the practice of the person's profession; (C) a broker-dealer or its agents whose performance of investment advice is solely incidental to the conduct of business as a broker-dealer and that does not receive special compensation for the investment advice; (D) a publisher of a bona fide newspaper, news magazine, or business or financial publication of general and regular circulation; (E) a federal covered investment adviser; (F) a bank or savings institution; (G) any other person that is excluded by the InvestmentInvestment Advisers Act of 1940definition of investment adviser; or (H) any other person excluded by rule or order under this chapter. (16) "Investment adviser representative" means an individual employed by or associated with an investment adviser or federal covered investment adviser and who makes any recommendations or otherwise gives investment advice regarding securities, manages accounts or portfolios of clients, determines which recommendation or advice regarding securities should be given, provides investment advice or holds herself or himself out as providing investment advice, receives compensation to solicit, offer, or negotiate for the sale of or for selling investment advice, or supervises employees who perform any of the foregoing. The term does not include an individual: (A) who performs only clerical or ministerial acts; (B) who is an agent whose performance of investment advice is solely incidental to the individual acting as an agent and who does not receive special compensation for investment advisory services; (C) who is employed by or associated with a federal covered investment adviser, unless the individual has a "place of business" in this State as that term is defined by rule adopted under Section 203A of the Investment Advisers Act of 1940 (15 U.S.C. Section80b-3a) and is (i) an "investment adviser representative" as that term is defined by rule adopted under Section 203A of the Investment Advisers Act of 1940 (15 U.S.C. Section80b-3a); or (ii) not a "supervised person" as that term is defined in Section 202(a)(25) of the Investment Advisers Act of 1940 (15 U.S.C. 15 U.S.Section1525)); or (D) who is excluded by rule or order under this chapter. (17) "Issuer" means a person that issues or proposes to issue a security, subject to the following: (A) The issuer of a voting trust certificate, collateral trust certificate, certificate of deposit for a security, or share in an investment company without a board of directors or individuals performing similar functions, is the person performing the acts and assuming the duties of depositor or manager pursuant to the trust or other agreement or instrument under which the security is issued. (B) The issuer of an equipment trust certificate or similar security serving the same purpose, is the person by which the property is, or is to be, used, or to which the property or equipment is, or is to be, leased or conditionally sold, or that is otherwise contractually responsible for assuring payment of the certificate. (C) The issuer of a fractional undivided interest in an oil, gas, or other mineral lease or in payments out of production under a lease, right, or royalty is the owner of an interest in the lease or in payments out of production under a lease, right, or royalty, whether whole or fractional, that creates fractional interests for the purpose of sale. (18) "Nonissuer transaction" or "nonissuer distribution" means a transaction or distribution not directly or indirectly for the benefit of the issuer. (19) "Offer to purchase" includes an attempt or offer to obtain, or solicitation of an offer to sell, a security or interest in a security for value. The term does not include a tender offer that is subject to Section 14(d) of the Securities Exchange Act of 1934 (15 U.S.C.78n(d)). (20) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government; governmental subdivision, agency, or instrumentality; public corporation; or any other legal or commercial entity. (21) "Place of business" of a broker-dealer, an investment adviser, or a federal covered investment adviser means: (A) an office at which the broker-dealer, investment adviser, or federal covered investment adviser regularly provides brokerage or investment advice, or solicits, meets with, or otherwise communicates with customers or clients; or (B) any other location that is held out to the general public as a location at which the broker-dealer, investment adviser, or federal covered investment adviser provides brokerage or investment advice, or solicits, meets with, or otherwise communicates with customers or clients. (22) Intentionally omitted. (23) "Price amendment" means the amendment to a registration statement filed under the Securities Act of 1933 or, if an amendment is not filed, the prospectus or prospectus supplement filed under the Securities Act of 1933 that includes a statement of the offering price, underwriting and selling discounts or commissions, amount of proceeds, conversion rates, call prices, and other matters dependent upon the offering price. (24) "Principal place of business" of a broker-dealer or an investment adviser means the executive office of the broker-dealer or investment adviser from which the officers, partners, or managers of the broker-dealer or investment adviser direct, control, and coordinate the activities of the broker-dealer or investment adviser. (25) "Record," except in the phrases "of record," "official record," and "public record," means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. (26) "Sale" includes every contract of sale, contract to sell, or disposition of, a security or interest in a security for value, and "offer to sell" includes an attempt or offer to dispose of, or solicitation of an offer to purchase, a security or interest in a security for value. Both terms include: (A) a security given or delivered with, or as a bonus on account of, a purchase of securities or any other thing constituting part of the subject of the purchase and having been offered and sold for value; (B) a gift of assessable stock involving an offer and sale; and (C) a sale or offer of a warrant or right to purchase or subscribe to another security of the same or another issuer, and a sale or offer of a security that gives the holder a present or future right or privilege to convert the security into another security of the same or other issuer, including an offer of the other security. (27) "Securities and Exchange Commission" means the United States Securities and Exchange Commission. (28) "Security" means a note; stock; treasury stock; security future; bond; debenture; evidence of indebtedness; certificate of interest or participation in a profit-sharing agreement; collateral trust certificate; preorganization certificate or subscription; transferable share; investment contract; voting trust certificate; certificate of deposit for a security; fractional undivided interest in oil, gas, or other mineral rights; put, call, straddle, option, or privilege on a security, certificate of deposit, or group or index of securities, including an interest therein or based on the value thereof; put, call, straddle, option or privilege entered into on a national securities exchange relating to foreign currency, or, in general, an interest or instrument commonly known as a "security"; or a certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing. (A) The term includes both a certificated and an uncertificated security. (B) The term does not include an insurance or endowment policy or annuity contract under which an insurance company promises to pay a fixed or variable sum of money either in a lump sum or periodically for life or other specified period. (C) The term does not include an interest in a contributory or noncontributory pension or welfare plan subject to the Employee Retirement Income Security Act of 1974. (D) The term includes an investment in a common enterprise with the expectation of profits to be derived primarily from the efforts of a person other than the investor. A "common enterprise" means an enterprise in which the fortunes of the investor are interwoven with those of either the person offering the investment, a third party or other investors. (E) The term includes as an "investment contract", among other contracts, an interest in a limited partnership and a limited liability company and an investment in a viatical settlement or similar agreement. (29) "Self-regulatory organization" means a national securities exchange registered under the Securities Exchange Act of 1934, a national securities association of broker-dealers registered under the Securities Exchange Act of 1934, a clearing agency registered under the Securities Exchange Act of 1934, or the Municipal Securities Rulemaking Board established under the Securities Exchange Act of 1934. (30) "Sign" means, with present intent to authenticate or adopt a record: (A) to execute or adopt a tangible symbol; or (B) to attach or logically associate with the record an electronic symbol, sound, or process. (31) "State" means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 66.

"Securities Act of 1933" (15 U.S.C. Section77a et seq.), "Securities Exchange Act of 1934" (15 U.S.C. Section78a et seq.), "Public Utility Holding Company Act of 1935" ( 15 U.S.C. Section 79 et seq.), "Investment Company Act of 1940" (15 U.S.C. Section80a-1 et seq.), "Investment Advisers Act of 1940" ( 15 U.S.C. Section 67b- 1 et seq.), "Employee Retirement Income Security Act of 1974" (29 U.S.C. Section1001 et seq.), "National Housing Act" (12 U.S.C. Section1701 et seq.), "Commodity Exchange Act" (7 U.S.C. Section1 et seq.), "Internal Revenue Code" (26 U.S.C. Section1 et seq.), "Securities Investor Protection Act of 1970" (15 U.S.C. Section78aaa et seq.), "Securities Litigation Uniform Standards Act of 1998" (112 Stat. 3227), "Small Business Investment Act of 1958" (15 U.S.C. Section661 et seq.), and "Electronic Signatures in Global and National Commerce Act" (15 U.S.C. Section7001 et seq.), mean those statutes and the rules and regulations adopted under those statutes, as in effect on the date of enactment of this chapter, or as later amended. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 73.

Any reference in this chapter to an agency or department of the United States shall also be deemed to be a reference to its successor agency, department, or entity. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 74.

This chapter modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act, but does not modify, limit, or supersede Section 101(c) of that act (15 U.S.C. Section7001(c)) or authorize electronic delivery of any of the notices described in Section 103(b) of that act (15 U.S.C. Section7003(b)). This chapter authorizes the filing of records and signatures, when specified by provisions of this chapter or by a rule or order adopted or issued under this chapter, in a manner consistent with section 104(a) of that act (15 U.S.C. Section7004(a)). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 74.

The following securities are exempt from the requirements of sections 621 through 626 and [654]: (1) A security, including a revenue obligation or a separate security as defined in Rule 131 ( 17 C.F.R 230 ) adopted under the Securities Act of 1933, issued, insured, or guaranteed by the United States; by a State; by a political subdivision of a State; by public authority, agency, or instrumentality of one or more States; by a political subdivision of one or more States; or by a person controlled or supervised by and acting as an instrumentality of the United States under authority granted by the Congress; or a certificate of deposit for any of the foregoing; (2) A security issued, insured, or guaranteed by a foreign government with which the United States maintains diplomatic relations, or any of its political subdivisions, if the security is recognized as a valid obligation by the issuer, insurer, or guarantor; (3) A security issued by and representing, or that will represent an interest in or a direct obligation of, or be guaranteed by: (A) an international banking institution; (B) a banking institution organized under the laws of the United States; a member bank of the Federal Reserve System; or a depository institution a substantial portion of the business of which consists or will consist of receiving deposits or share accounts that are insured to the maximum amount authorized by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund, or a successor authorized by federal law or exercising fiduciary powers that are similar to those permitted for national banks under the authority of the Comptroller of Currency pursuant to Section 1 of Public Law 87-722 (12 U.S.C. Section92a); or (C) any other depository institution, unless by rule or order the Administrator proceeds under section 614; (4) A security issued by and representing an interest in, or a debt of, or insured or guaranteed by, an insurance company authorized to do business in this State; (5) A security issued or guaranteed by a railroad, other common carrier, public utility, or public utility holding company that is: (A) regulated in respect to its rates and charges by the United States or a State; (B) regulated in respect to the issuance or guarantee of the security by the United States, a State, Canada, or a Canadian province or territory; or (C) a public utility holding company registered under the Public Utility Holding Company Act of 1935 or a subsidiary of such a registered holding company within the meaning of that act; (6) A federal covered security specified in Section 18(b)(1) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(1)) or by rule adopted under that provision or a security listed or approved for listing on another appropriate securities market specified by rule under this chapter; a put or a call option contract; warrant; a subscription right on or with respect to such securities; or an option or similar derivative security on a security or an index of securities or foreign currencies issued by a clearing agency registered under the Securities Exchange Act of 1934 and listed or designated for trading on a national securities exchange, a facility of a national securities exchange, or a facility of a national securities association registered under the Securities Exchange Act of 1934 or an offer or sale, of the underlying security in connection with the offer, sale or exercise of an option or other security that was exempt under this section when the option or other security was written or issued. For purposes of this paragraph, a derivative security is similar to an option if it has been designated by the Securities and Exchange Commission under Section 9(b) of the Securities Exchange Act of 1934 (15 U.S.C. Section78i(b)); (7) A security issued by a person organized and operated exclusively for religious, educational, benevolent, fraternal, charitable, social, athletic, or reformatory purposes, or as a chamber of commerce, and not for pecuniary profit, no part of the net earnings of which inures to the benefit of a private stockholder or other person, or a security of a company that is excluded from the definition of an investment company under Section 3(c)(10)(B) of the Investment Company Act of 1940 (15 U.S.C. Section80a-3(c)(10)(B); with respect to the offer or sale of a note, bond, debenture, or other evidence of indebtedness, a rule under this chapter may limit the availability of this exemption by classifying securities, persons, and transactions and adopting different requirements for different classes; such a rule may require an issuer: (A) to file a notice specifying the material terms of the proposed offer or sale and copies of any proposed sales and advertising literature to be used and provide that the exemption becomes effective if the Administrator does not disallow the exemption within the period established by the rule; (B) to file a request for exemption authorization for which a rule under this chapter may specify the scope of the exemption; the requirement of an offering statement; the filing of sales and advertising literature; the filing of consent to service of process complying with section 671; and grounds for denial or suspension of the exemption; or (C) to register under section 624; (8) A member's or owner's interest in, or a retention certificate or like security given in lieu of a cash patronage dividend issued by, a cooperative organized and operated as a nonprofit membership cooperative under the cooperative laws of a State, but not a member's or owner's interest, retention certificate, or like security sold to persons other than bona fide members of the cooperative; and (9) An equipment trust certificate in respect to equipment leased or conditionally sold to a person, if any security issued by the person would be exempt under this section or would be a federal covered security under Section 18(b)(1) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(1)). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 74.

The following transactions are exempt from the requirements of sections 621 through 626 and 654: (1) An isolated nonissuer transaction, whether effected by or through a broker-dealer or not; (2) A nonissuer transaction by or through a broker-dealer registered, or exempt from registration under this chapter, and a resale transaction by a sponsor of a unit investment trust registered under the Investment Company Act of 1940, in a security of a class that has been outstanding in the hands of the public for at least 90 days; if, at the date of the transaction: (A) the issuer of the security is engaged in business, the issuer is not in the organizational stage or in bankruptcy or receivership, and the issuer is not a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that its primary plan of business is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person; (B) the security is sold at a price reasonably related to its current market price; (C) the security does not constitute the whole or part of an unsold allotment to, or a subscription or participation by, the broker-dealer as an underwriter of the security or a redistribution; and (D) a nationally recognized securities manual or its electronic equivalent designated by rule or order under this chapter or a record filed with the Securities and Exchange Commission that is publicly available contains: (i) a description of the business and operations of the issuer; (ii) the names of the issuer's executive officers and the names of the issuer's directors, if any; (iii) an audited balance sheet of the issuer as of a date within 18 months of the date of the transaction or, in the case of a reorganization or merger, when the parties to the reorganization or merger each had an audited balance sheet, a pro forma balance sheet for the combined organization; and (iv) an audited income statement for each of the issuer's two immediately previous fiscal years or for the period of existence of the issuer, whichever is shorter, or, in the case of a reorganization or merger when each party to the reorganization or merger had audited income statements, a pro forma income statement; or (E) any one of the following requirements is met: (i) the issuer of the security has a class of equity securities listed on a national securities exchange registered under Section 6 of the Securities Exchange Act of 1934 or designated for trading on the National Association of Securities Dealers Automated Quotation System; (ii) the issuer of the security is a unit investment trust registered under the Investment Company Act of 1940; (iii) the issuer of the security, including its predecessors, has been engaged in continuous business for at least three years; or (iv) the issuer of the security has total assets of at least $2,000,000 based on an audited balance sheet as of a date within 18 months before the date of the transaction or, in the case of a reorganization or merger when the parties to the reorganization or merger each had such an audited balance sheet, a pro forma balance sheet for the combined organization; (3) A nonissuer transaction by or through a broker-dealer registered or exempt from registration under this chapter in a security of a foreign issuer that is a margin security defined in regulations or rules adopted by the Board of Governors of the Federal Reserve System; (4) A nonissuer transaction by or through a broker-dealer registered or exempt from registration under this chapter in an outstanding security if the guarantor of the security files reports with the Securities and Exchange Commission under the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.78m or 78o(d)); (5) A nonissuer transaction by or through a broker-dealer registered or exempt from registration under this chapter in a security that: (A) is rated at the time of the transaction by a nationally recognized statistical rating organization in one of its four highest rating categories; or (B) has a fixed maturity or a fixed interest or dividend, if: (i) a default has not occurred during the current fiscal year or within the three previous fiscal years or during the existence of the issuer and any predecessor if less than three fiscal years, in the payment of principal, interest, or dividends on the security; and (ii) the issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not and has not been within the previous 12 months a blank check, blind pool, or shell company that has no business plan or purpose or has indicated that its primary plan of business is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person; (6) A nonissuer transaction by or through a broker-dealer registered or exempt from registration under this chapter effecting an unsolicited order or offer to purchase; (7) A nonissuer transaction executed by a bona fide pledgee without any purpose of evading this chapter; (8) A nonissuer transaction with a federal covered investment adviser with investments under management in excess of $100,000,000 acting in the exercise of discretionary authority in a signed record for the account of others; (9) a transaction in a security, whether or not the security or transaction is otherwise exempt, in exchange for one or more bona fide outstanding securities, claims, or property interests, or partly in such exchange and partly for cash, if the terms and conditions of the issuance and exchange or the delivery and exchange and the fairness of the terms and conditions have been approved by the administrator after a hearing; (10) A transaction between the issuer or other person on whose behalf the offering is made and an underwriter, or among underwriters; (11) A transaction in a note, bond, debenture, or other evidence of indebtedness secured by a mortgage or other security agreement if: (A) the note, bond, debenture, or other evidence of indebtedness is offered and sold with a mortgage or other security agreement as a unit; (B) a general solicitation or general advertisement of the transaction is not made; and (C) a commission or other remuneration is not paid or given, directly or indirectly, to a person not registered under this chapter as a broker-dealer or as an agent; (12) A transaction by an executor, administrator of an estate, sheriff, marshal, receiver, trustee in bankruptcy, guardian, or conservator; (13) A sale or offer to sell to: (A) an institutional investor; (B) a federal covered investment adviser; or (C) any other person exempted by rule or order under this chapter; (14) A sale or an offer to sell securities of an issuer, if part of a single issue in which: (A) there are not more than 25 purchasers in this State during any 12 consecutive months, other than those designated in paragraph (13); (B) paragraph (13)solicitation or general advertising is not made in connection with the offer to sell or sale of the securities; (C) a commission or other remuneration is not paid or given, directly or indirectly, to a person other than a broker-dealer registered under this chapter or an agent registered under this chapter for soliciting a prospective purchaser in this State; and (D) the issuer reasonably believes that all the purchasers in this State other than those designated in paragraph (13) are purchasing for investment; (15) A transaction under an offer to existing security holders of the issuer, including persons that at the date of the transaction are holders of convertible securities, options, or warrants, if a commission or other remuneration, other than a standby commission, is not paid or given, directly or indirectly, for soliciting a security holder in this State; (16) An offer to sell, but not a sale, of a security not exempt from registration under the Securities Act of 1933 if: (A) a registration or offering statement or similar record as required under the SecuritiesSecurities Act of 1933een filed, but is not effective, or the offer is made in compliance with Rule 1Rule 165nder the Securities Act of 1933 (17 C.F.R.230.165); and (B) a stop order of which the offeror is aware has not been issued against the offeror by the administrator or the Securities and Exchange Commission, and an audit, inspection, or proceeding that is public and may culminate in a stop order is not known by the offeror to be pending; (17) An offer to sell, but not a sale, of a security exempt from registration under the Securities Act of 1933 if: (A) a registration statement has been filed under this chapter, but is not effective; (B) a solicitation of interest is provided in a record to offerees in compliance with a rule adopted by the administrator under this chapter; and (C) a stop order of which the offeror is aware has not been issued by the Administrator under this chapter, and an audit, inspection, or proceeding that may culminate in a stop order is not known by the offeror to be pending; (18) A transaction involving the distribution of the securities of an issuer to the security holders of another person in connection with a merger, consolidation, exchange of securities, sale of assets, or other reorganization to which the issuer, or its parent or subsidiary and the other person, or its parent or subsidiary, are parties; (19) A rescission offer, sale, or purchase under section 660; (20) An offer or sale of a security to a person not a resident of this State and not present in this State if the offer or sale does not constitute a violation of the laws of the State or foreign jurisdiction in which the offeree or purchaser is present and is not a part of an unlawful plan or scheme to evade this chapter; (21) Employees' stock purchase, savings, option, profit-sharing, pension, or similar employees' benefit plan, including any securities, plan interests, and guarantees issued under a compensatory benefit plan or compensation contract, contained in a record, established by the issuer, its parents, its majority-owned subsidiaries, or the majority-owned subsidiaries of the issuer's parent for the participation of their employees including offers or sales of such securities to: (A) offers or sales of such securities to directors; general partners; trustees, if the issuer is a business trust; officers; or consultants and advisors; (B) family members who acquire such securities from those persons through gifts or domestic relations orders; (C) former employees, directors, general partners, trustees, officers, consultants, and advisors if those individuals were employed by or providing services to the issuer when the securities were offered; and (D) insurance agents who are exclusive insurance agents of the issuer, its subsidiaries or parents, or who derive more than 50 percent of their annual income from those organizations; (22) A transaction involving: (A) a stock dividend or equivalent equity distribution, whether the corporation or other business organization distributing the dividend or equivalent equity distribution is the issuer or not, if nothing of value is given by stockholders or other equity holders for the dividend or equivalent equity distribution other than the surrender of a right to a cash or property dividend if each stockholder or other equity holder may elect to take the dividend or equivalent equity distribution in cash, property, or stock; (B) an act incident to a judicially approved reorganization in which a security is issued in exchange for one or more outstanding securities, claims, or property interests, or partly in such exchange and partly for cash; or (C) the solicitation of tenders of securities by an offeror in a tender offer in compliance with Rule 162 adopted under the Securities Act of 1933 (17 C.F.R.230.162); or (23) A nonissuer transaction in an outstanding security by or through a broker-dealer registered or exempt from registration under this chapter, if the issuer is a reporting issuer in a foreign jurisdiction designated by this paragraph or by rule adopted or order issued under this chapter; has been subject to continuous reporting requirements in the foreign jurisdiction for not less than 180 days before the transaction; and the security is listed on the foreign jurisdiction's securities exchange that has been designated by this paragraph or by rule adopted or order issued under this chapter, or is a security of the same issuer that is of senior or substantially equal rank to the listed security or is a warrant or right to purchase or subscribe to any of the foregoing. For purposes of this paragraph, Canada, together with its provinces and territories, is a designated foreign jurisdiction and The Toronto Stock Exchange, Inc., is a designated securities exchange. After an administrative hearing, the administrator, by rule adopted or order issued under this chapter, may revoke the designation of a securities exchange under this paragraph, if the administrator finds that revocation is necessary or appropriate in the public interest and for the protection of investors. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 76.

A rule adopted or issued order under this chapter may exempt a security, transaction, or offer; a rule under this chapter may exempt a class of securities, transactions, or offers from any or all of the requirements of sections 621 through 626 and 654, and an order under this chapter may waive, in whole or in part, any or all of the conditions for an exemption or offers under sections 611 and 612. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 81.

(a) Except with respect to a federal covered security or a transaction involving a federal covered security, an order under this chapter may deny, suspend application of, condition, limit or revoke an exemption created under section 611(3)(C), (7), (8), or 612 or an exemption or waiver created under section 613 with respect to a specific security, transaction, or offer. An order under this section may only be issued pursuant to the procedures in section 626(d) or 664 and may only be issued prospectively. (b) A person does not violate section 621, 623 through 626, 654, or 660 by an offer to sell, offer to purchase, sale, or purchase effected after the entry of an order issued under this section if the person did not know, and in the exercise of reasonable care could not have known, of the order. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 81.

It is unlawful for a person to offer or sell a security in this State unless: (1) the security is a federal covered security; (2) the security, transaction, or offer is exempted from registration under sections 611 through 613; or (3) the security is registered under this chapter. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 82.

(a) A rule adopted or order issued under this Chapter may require the filing of any or all of the following records with respect to a security issued by an investment company that is a federal covered security, as defined in Section 18(b)(2) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(2)) that is not otherwise exempt under Section 611 through 613: (1) before the initial offer of a federal covered security in this state, all records that are part of a federal registration statement filed with Securities and Exchange Commission under the Securities Act of 19Securities Act of 1933 filing form a consent to service of process complying with Section 671 signed by the issuer, and the payment of a fee in an amount to be established by the rule adopted or order issued by the Administrator, but in no case shall the fee exceed $500 per fund or trust; and (2) after the initial offer of the federal covered security in this State, all amendments to a uniform filing form or records that are part of an amendment to a federal registration statement filed with the Securities and Exchange Commission under the Securities Act of 1933. (3) [Deleted.] (b) A notice filing under subsection (a) is effective for one year commencing on the later of the Administrator's receipt of a uniform notice filing form or the effectiveness of the offering filed with the Securities and Exchange Commission. On or before expiration, the issuer may renew a notice filing by filing a current uniform notice filing form or a copy of those records filed by the issuer with Securities and Exchange Commission that required by rule or order under this chapter to be filed and by paying a renewal fee to be established by rule issued or order adopted by the Administrator, but in no case shall the fee exceed the initial notice filing fee. A previously filed consent to service of process complying with Section 611 may be incorporated by reference in renewal. A renewed notice filing becomes effective upon the expiration of the filing being renewed. (c) With respect to any security that is a federal covered security under Section 18(b)(4) (D) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(4)(D)), a rule under this chapter may require a notice filing by or on behalf of an issuer to include a copy of Form D, including the Appendix, as promulgated by the Securities and Exchange Commission, and a consent to service of process complying with section 671 signed by the issuer not later than 15 days after the first sale of the federal covered security in this State and the payment of a fee to be established by rule adopted or order issued by the Administrator, but in no case shall the fee exceed $2,500; and a payment of a late fee to be determined by the Administrator, but in no case shall the late fee exceed $5,000. (d) If the Administrator finds that there is a failure to comply with a notice or fee requirement of this section, the Administrator may issue a stop order suspending the offer and sale of a federal covered security in this State, except with respect to a federal covered security under Section 18(b) (1) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(1)). If the deficiency is corrected, the stop order is void as of the time of its issuance and no other penalty may be imposed by the Administrator. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 82; amended Mar. 5, 2005, No. 6727, § 21(a), Sess. L. 2005, pp. 63-64.

(a) A security for which a registration statement has been filed under the Securities Act of 1933 in connection with the same offering may be registered by coordination under this section. (b) A registration statement and accompanying records under this Section must contain or be accompanied by the following records in addition to the information specified in section 625 and a consent to service of process complying with section 671: (1) a copy of the latest form of prospectus filed under the Securities Act of 1933; (2) a copy of the articles of incorporation and bylaws or their substantial equivalents currently in effect; a copy of any agreement with or among underwriters; a copy of any indenture or other instrument governing the issuance of the security to be registered; and a specimen, copy, or description of the security that is required by rule adopted or order issued under this chapter; (3) copies of any other information, or any other records filed by the issuer under the SecuritiesSecurities Act of 1933 by the Administrator; and (4) an undertaking to forward each amendment to the federal prospectus, other than an amendment that delays the effective date of the registration statement, promptly after it is filed with the Securities and Exchange Commission. (c) A registration statement under this section becomes effective simultaneously with or subsequent to the federal registration statement when all the following conditions are satisfied: (1) a stop order under subsection (d) or section 626 or issued by the Securities and Exchange Commission is not in effect and a proceeding is not pending against the issuer under section 642; and (2) the registration statement has been on file for at least 20 days or a shorter period provided by rule or order under this chapter. (d) The registrant shall promptly notify the Administrator in a record of the date when the federal registration statement becomes effective and the content of any price amendment. If the notice is not timely received, the Administrator may issue a stop order, without prior notice or hearing, retroactively denying effectiveness to the registration statement or suspending its effectiveness until compliance with this section. The Administrator shall promptly notify the registrant of an order by telegram, telephone, or electronic means and promptly confirm this notice by a record. If the registrant subsequently complies with the notice requirements of this section, the stop order is void as of the time of its issuance. (e) If the federal registration statement becomes effective before each of the conditions in this section is satisfied or is waived by the Administrator, the registration statement is automatically effective under this chapter when all the conditions are satisfied or waived. If the registrant notifies the Administrator of the date when the federal registration statement is expected to become effective, the Administrator shall promptly notify the registrant by telegram, telephone, or electronic means and promptly confirm this notice by a record, indicating whether all the conditions are satisfied or waived and whether the Administrator intends the institution of a proceeding under section 626. The notice by the Administrator does not preclude the institution of such a proceeding. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 83.

(a) A security may be registered by qualification under this section. (b) A registration statement under this section must contain the information specified in section 625, a consent to service of process complying with section 671, and, if required by rule adopted under this chapter, the following information and the following records: (1) with respect to the issuer and any significant subsidiary, its name, address, and form of organization; the State or foreign jurisdiction and date of its organization; the general character and location of its business; a description of its physical properties and equipment; and a statement of the general competitive conditions in the industry or business in which it is or will be engaged; (2) with respect to each director and officer of the issuer, and other person having a similar status or performing similar functions, the person's name, address, and principal occupation for the previous five years; the amount of securities of the issuer held by the person as of the 30th day before the filing of the registration statement; the amount of the securities covered by the registration statement to which the person has indicated an intention to subscribe; and a description of any material interest of the person in any material transaction with the issuer or a significant subsidiary effected within the previous three years or proposed to be effected; (3) with respect to persons covered by paragraph (2), the aggregate sum of the remuneration paid to those persons during the previous 12 months and estimated to be paid during the nparagraph (2), directly or indirectly, by the issuer, and all predecessors, parents, subsidiaries, and affiliates of the issuer; (4) with respect to a person owning of record or owning beneficially, if known, 10 percent or more of the outstanding shares of any class of equity security of the issuer, the information specified in paragraph (2) other than the person's occupation; (5) with respect to a promoter if the issuer was organized within the previoparagraph (2)s, the information specified in paragraph (2), any amount paid to the promoter within that period or intended to be paid to the promoter, and the consideratioparagraph (2)ment; (6) with respect to a person on whose behalf any part of the offering is to be made in a nonissuer distribution, the person's name and address; the amount of securities of the issuer held by the person as of the date of the filing of the registration statement; a description of any material interest of the person in any material transaction with the issuer or any significant subsidiary effected within the previous three years or proposed to be effected; and a statement of the reasons for making the offering; (7) the capitalization and long term debt, on both a current and pro forma basis, of the issuer and any significant subsidiary, including a description of each security outstanding or being registered or otherwise offered, and a statement of the amount and kind of consideration, whether in the form of cash, physical assets, services, patents, goodwill, or anything else of value, for which the issuer or any subsidiary has issued its securities within the previous two years or is obligated to issue its securities; (8) the kind and amount of securities to be offered; the proposed offering price or the method by which it is to be computed; any variation at which a proportion of the offering is to be made to a person or class of persons other than the underwriters, with a specification of the person or class; the basis upon which the offering is to be made if otherwise than for cash; the estimated aggregate underwriting and selling discounts or commissions and finders' fees, including separately cash, securities, contracts, or anything else of value to accrue to the underwriters or finders in connection with the offering, or, if the selling discounts or commissions are variable, the basis of determining them and their maximum and minimum amounts; the estimated amounts of other selling expenses, including legal, engineering, and accounting charges; the name and address of each underwriter and each recipient of a finder's fee; a copy of any underwriting or selling group agreement under which the distribution is to be made, or the proposed form of any such agreement whose terms have not yet been determined; and a description of the plan of distribution of any securities that are to be offered otherwise than through an underwriter; (9) the estimated monetary proceeds to be received by the issuer from the offering; the purposes for which the proceeds are to be used by the issuer; the estimated amount to be used for each purpose; the order or priority in which the proceeds will be used for the purposes stated; the amounts of any funds to be raised from other sources to achieve the purposes stated; the sources of the funds; and, if a part of the proceeds is to be used to acquire property, including goodwill, otherwise than in the ordinary course of business, the names and addresses of the vendors, the purchase price, the names of any persons that have received commissions in connection with the acquisition, and the amounts of the commissions and other expenses in connection with the acquisition, including the cost of borrowing money to finance the acquisition; (10) a description of any stock options or other security options outstanding, or to be created in connection with the offering, and the amount of those options held or to be held by each person required to be named in paragraph (2), (4), (5), (6), or (8) and by any person that holds or will hoparagraph (2), (4), (5), (6) aggregate of those options; (11) the dates of, parties to, and general effect concisely stated of each managerial or other material contract made or to be made otherwise than in the ordinary course of business to be performed in whole or in part at or after the filing of the registration statement or that was made within the previous two years, and a copy of the contract; (12) a description of any pending litigation, action, or proceeding to which the issuer is a party and that materially affects its business or assets, including any litigation, action, or proceeding known to be contemplated by governmental authorities; (13) a copy of any prospectus, pamphlet, circular, form letter, advertisement, or other sales literature intended as of the effective date to be used in connection with the offering and any solicitation of interest used in compliance with section 612(17)(B); (14) a specimen or copy of the security being registered, unless the security is uncertificated, a copy of the issuer's articles of incorporation and bylaws, or their substantial equivalents, in effect; and a copy of any indenture or other instrument covering the security to be registered; (15) a signed or conformed copy of an opinion of counsel concerning the legality of the security being registered, with an English translation if it is in a language other than English, which states whether the security when sold will be validly issued, fully paid, and nonassessable and, if a debt security, a binding obligation of the issuer; (16) a signed or conformed copy of a consent of any accountant, attorney, engineer, appraiser, or other person whose profession gives authority for a statement made by the person, if the person is named as having prepared or certified a report or valuation, other than an official record, that is public, which is used in connection with the registration statement; (17) a balance sheet of the issuer as of a date within four months before the filing of the registration statement; a statement of income and changes in financial position for each of the three fiscal years preceding the date of the balance sheet and for any period between the close of the immediately previous fiscal year and the date of the balance sheet, or for the period of the issuer's and any predecessor's existence if less than three years; and, if any part of the proceeds of the offering is to be applied to the purchase of a business, the financial statements that would be required if that business were the registrant; and (18) any additional information required by rule or order under this chapter. (c) A registration statement under this section becomes effective 30 days, or any shorter period provided by rule or order under this chapter, after the date the registration statement or the last amendment other than a price amendment is filed, if: (1) a stop order is not in effect and a proceeding is not pending under section 626; (2) the Administrator has not issued an order under section 626(c) delaying effectiveness; and (3) the applicant or registrant has not requested that effectiveness be delayed. (d) The Administrator may delay effectiveness once for not more than 90 days if the Administrator determines the registration statement is not complete in all material respects and promptly notifies the applicant or registrant of that determination. The Administrator may also delay effectiveness for a further period of not more than 30 days if the Administrator determines that the delay is necessary or appropriate. (e) A rule adopted or order issued under this chapter may require as a condition of registration under this section that a prospectus containing a specified part of the information specified in subsection (b) be sent or given to each person to which an offer is made, before or concurrently, with the earliest of: (1) the first offer made in a record to the person otherwise than by means of a public advertisement, by or for the account of the issuer or another person on whose behalf the offering is being made, or by an underwriter or broker-dealer that is offering part of an unsold allotment or subscription taken by the person as a participant in the distribution; (2) the confirmation of any sale made by or for the account of the person; (3) payment pursuant to such a sale; or (4) delivery of the security pursuant to such a sale. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 84.

(a) A registration statement may be filed by the issuer, a person on whose behalf the offering is to be made, or a broker-dealer registered under this chapter. (b) A person filing a registration statement shall pay a filing fee established by rule issued or order adopted by the Administrator. If a registration statement is withdrawn before the effective date or a preeffective stop order is issued under section 626, the Administrator shall retain an amount established by rule or order. (c) A registration statement filed under section 623 or 624 must specify: (1) the amount of securities to be offered in this State; (2) the States in which a registration statement or similar record in connection with the offering has been or is to be filed; and (3) any adverse order, judgment, or decree issued in connection with the offering by a State securities regulator, the Securities and Exchange Commission, or a court. (d) A record filed under this chapter, if within five years preceding the filing of a registration statement, may be incorporated by reference in the registration statement to the extent that the record is currently accurate. (e) In the case of a nonissuer distribution, information or a record may not be required under subsection (i) or section 624, unless it is known to the person filing the registration statement or to the person on whose behalf the distribution is to be made, or unless it can be furnished by those persons without unreasonable effort or expense. (f) A rule or order under this chapter may require as a condition of registration that a security issued within the previous five years or to be issued to a promoter for a consideration substantially less than the public offering price, or to a person for a consideration other than cash, be deposited in escrow; and that the proceeds from the sale of the registered security in this State be impounded until the issuer receives a specified amount from the sale of the security either in this State or elsewhere. The conditions of any escrow or impoundment required under this subsection may be established by rule or order under this chapter, but the Administrator may not reject a depository institution solely because of its location in another State. (g) A rule or order under this chapter may require as a condition of registration that a security registered under this chapter be sold only on a specified form of subscription or sale contract and that a signed or conformed copy of each contract be filed under this chapter or preserved for a period specified by rule or order, which may not be longer than five years. (h) Except while a stop order is in effect under section 626, a registration statement is effective for one year after its effective date, or for a longer period designated in an order under this chapter during which the security is being offered or distributed in a nonexempted transaction by or for the account of the issuer or other person on whose behalf the offering is being made or by an underwriter or broker-dealer that is still offering part of an unsold allotment or subscription taken as a participant in the distribution. For the purposes of a nonissuer transaction, all outstanding securities of the same class identified in the registration statement as a security registered under this chapter are considered to be registered while the registration statement is effective. If any securities of the same class are outstanding, a registration statement may not be withdrawn until one year after its effective date. A registration statement may be withdrawn only with the approval of the Administrator. (i) While a registration statement is effective, a rule or order under this chapter may require the person that filed the registration statement to file reports, not more often than quarterly, to keep the information or record in the registration statement reasonably current and to disclose the progress of the offering. (j) A registration statement may be amended after its effective date. The posteffective amendment becomes effective when the Administrator so orders. If a posteffective amendment is made to increase the number of securities specified to be offered or sold, the person filing the amendment shall pay a registration fee equal to that specified in subsection (b). A posteffective amendment relates back to the date of the offering of the additional securities being registered, if within one year after the date of the sale the amendment is filed and the additional registration fee is paid. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 88.

(a) The Administrator may issue a stop order denying effectiveness to, or suspending or revoking the effectiveness of, a registration statement if the Administrator finds that the order is in the public interest and that: (1) the registration statement as of its effective date or before the effective date in the case of an order denying effectiveness, an amendment under section 625(j) as of its effective date, or a report under section 625(i), is incomplete in a material respect or contains a statement that, in the light of the circumstances under which it was made, was false or misleading with respect to a material fact; (2) this chapter or a rule adopted or order issued under this chapter or a condition imposed under this chapter has been willfully violated, in connection with the offering, by the person filing the registration statement; by the issuer, a partner, officer, or director of the issuer or a person having a similar status or performing a similar function; a promoter of the issuer or a person directly or indirectly controlling or controlled by the issuer; but only if the person filing the registration statement is directly or indirectly controlled by or acting for the issuer; or by an underwriter; (3) the security registered or sought to be registered is the subject of a permanent or temporary injunction of a court of competent jurisdiction or an Administrative stop order or similar order issued under any federal, foreign, or state law other than this chapter applicable to the offering, but the Administrator may not institute a proceeding against an effective registration statement under this paragraph more than one year after the date of the order or injunction on which it is based, and the Administrator may not issue an order under this paragraph on the basis of an order or injunction issued under the securities act of another state unless the order or injunction was based on facts that would constitute, as of the date of the order, a ground for a stop order under this section; (4) the issuer's enterprise or method of business includes or would include activities that are illegal where performed; (5) with respect to a security sought to be registered under section 623, there has been a failure to comply with the undertaking required by section 623(b)(4); (6) the applicant or registrant has not paid the proper filing fee, but the Administrator may issue only a stop order under this paragraph and shall void the order if the deficiency is corrected; or (7) the offering: (A) will work or tend to work a fraud upon purchasers or would so operate; or (B) has been or would be made with unreasonable amounts of underwriters' and sellers' discounts, commissions, or other compensation, or promoters' profits or participations, or unreasonable amounts or kinds of options; or, (C) is being made on terms that are unfair, unjust, or inequitable. (b) To the extent practicable, the Administrator by rule or order under this chapter shall publish standards that provide notice of conduct that violates subsection (a)(7). (c) The Administrator may not institute a stop order proceeding against an effective registration statement on the basis of conduct or a transaction known to the Administrator when the registration statement became effective unless the proceeding is instituted within 30 days after the registration statement became effective. (d) The Administrator may summarily revoke, deny, postpone, or suspend the effectiveness of a registration statement pending final determination of an Administrative proceeding. Upon the issuance of the order, the Administrator shall promptly notify each person specified in subsection (e) that the order has been issued, the reasons for the revocation, denial, postponement or suspension, and that within 15 days after the receipt of a request in a record from the person the matter will be scheduled for a hearing. If a hearing is not requested and none is ordered by the Administrator, within 30 days after the date of service of the order, the order becomes final. If a hearing is requested or ordered, the Administrator, after notice of and opportunity for hearing for each person subject to the order may, modify or vacate the order or extend the order until final determination. (e) A stop order may not be issued under this section without: (1) appropriate notice to the applicant or registrant, the issuer, and the person on whose behalf the securities are to be or have been offered; (2) an opportunity for hearing; and (3) findings of fact and conclusions of law in a record. (f) The Administrator may modify or vacate a stop order issued under this section if the Administrator finds that the conditions that caused its issuance have changed or that it is necessary or appropriate in the public interest or for the protection of investors. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 89.

The Administrator may waive or modify any or all of the requirements of sections 622, 623, and 624(b) or the requirement of any information or record in a registration statement or in a periodic report pursuant to section 625(i). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 91.

(a) It is unlawful for a person to transact business in this State as a broker-dealer, unless the person is registered under this chapter as a broker-dealer or is exempt from registration as a broker-dealer under subsection (b) or (d). (b) The following persons are exempt from the registration requirement of subsection (a): (1) a broker-dealer without a place of business in this State if its only transactions effected in this State are with: (A) the issuer of the securities involved in the transactions; (B) a person registered as a broker-dealer under this chapter or not required to be registered as a broker-dealer under this chapter; (C) and institutional investor; (D) a nonaffiliated federal covered investment adviser with investments under management in excess of $100 million acting for the account of others pursuant to discretionary authority in a signed record; (E) a bona fide preexisting customer whose principal place of residence is not in this State and the person is registered as a broker-dealer under the SecuritiesSecurities Exchange Act of 1934quired to be registered under the SecuritiesSecurities Exchange Act of 1934gistered under the securities act of the State in which the customer maintains a principal place of residence; (F) a bona fide preexisting customer whose principal place of residence is in this State but was not present in this State when the customer relationship was established, if: (i) the broker-dealer is registered under the SecuritiesSecurities Exchange Act of 1934quired to be registered under the SecuritiesSecurities Exchange Act of 1934gistered under the securities laws of the State in which the customer relationship was established and where the customer had maintained a principal place of residence; and (ii) within 45 days after the customer's first transaction in this State, the person files an application for registration as a broker-dealer in this State and a further transaction is not effected more than 75 days after the date on which the application is filed, or, if earlier, the date on which the Administrator notifies the person that the Administrator has denied the application for registration or has stayed the pendency of the application for cause; (G) not more than three customers in this State during the previous 12 months, in addition to those specified in subparagraphs (A) through (F) and under subparagraph (H), if the broker- dealer is registered under the SecuritiesSecurities Exchange Act of 1934quired to be registered under the SecuritiesSecurities Exchange Act of 1934gistered under the securities act of the State in which the broker-dealer has its principal place of business; and (H) any other person exempted by rule or order under this chapter; and (2) a person that deals solely in United States government securities and is supervised as a dealer in government securities by the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Federal Deposit Insurance Corporation, or the Office of Thrift Supervision. (c) It is unlawful for a broker-dealer, or for an issuer engaged in offering, offering to purchase, purchasing, or selling securities in this State, directly or indirectly, to employ or associate with an individual to engage in an activity related to securities transactions in this State if the registration of the individual is suspended or revoked or the individual is barred from employment or association with a broker-dealer, an issuer, an investment adviser, or a federal covered investment adviser by an order of the Administrator under this chapter, the Securities and Exchange Commission, or a self-regulatory organization. A broker-dealer or issuer does not violate this subsection if the broker-dealer or issuer did not know, and in the exercise of reasonable care could not have known, of the suspension, revocation, or bar. Upon request from a broker- dealer or issuer and for good cause shown, an order under this chapter may modify or waive the prohibitions of this subsection. (d) A rule or order under this chapter may permit: (1) a broker-dealer that is registered in Canada or other foreign jurisdiction and that does not have a place of business in this State to effect transaction in securities with or for, or attempt to effect the purchase or sale of any securities by; (A) an individual from Canada or other foreign jurisdiction that is temporarily present in this State and with whom the broker-dealer had a bona fide client relationship before the individual entered the United States; (B) an individual from Canada or other foreign jurisdiction who is present in this State and whose transactions are in a self-directed tax advantaged retirement plan in that foreign jurisdiction of which the individual is the holder or contributor; or (C) an individual who is resident in this State, with whom the broker-dealer client relationship arose while the individual was temporarily or permanently resident in Canada or the other foreign jurisdiction; and (2) an agent who represents a broker-dealer, that is exempt under this subsection to effect transactions in securities or attempt to effect the purchase or sale of any securities in this State as permitted for a broker-dealer described in paragraph (d)(1). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 92.

(a) It is unlawful for an individual to transact business in this State as an agent unless the individual is registered under this chapter as an agent or is exempt from registration as an agent under subsection (b). (b) The following individuals are exempt from the registration requirement of subsection (a): (1) an individual who represents a broker-dealer in effecting transactions in this State limited to those described in Section 15(h)(2) of the Securities Exchange Act of 1934 ( 15 U.S.C. Section 78(o)(2) ); (2) an individual who represents15 U.S.C. Section 78(o)(2)t under section 631(b) or (d); (3) an individual who represents an issuer with respect to an offer or sale of the issuer's own securities or those of the issuer's parent or any of the issuer's subsidiaries, and who is not compensated in connection with the individual's participation by the payment of commissions or other remuneration based, directly or indirectly, on transactions in those securities; (4) an individual who represents an issuer and who effects transactions in the issuer's securities exempted by section 612, other than section 612(11) and (14); (5) an individual who represents an issuer who effects transactions solely in federal covered securities of the issuer, but an individual who effects transactions in a federal covered security under Section 18(b)(3) or 18(b)(4)(D) of the Securities Act of 1933 (15 U.S.C. Section77r(b)(3) or 77r(b)(4)(D)) is not exempt if the individual is compensated in connection with the agent's participation by the payment of commissions or other remuneration based, directly or indirectly, on transactions in those securities; (6) an individual who represents a broker-dealer registered in this State under section 631(a) or exempt under section 631(b) in the offer and sale of securities for an account of a nonaffiliated federal covered investment adviser with investments under management in excess of $100,000,000 acting for the account of others pursuant to discretionary authority in a signed record; (7) an individual who represents an issuer in connection with the purchase of the issuer's own securities; (8) an individual who represents an issuer in connection with the purchase of the participation to performing ministerial or clerical work; or (9) any other individual exempted by rule or order under this chapter. (c) The registration of an agent is effective only while the agent is employed by or associated with a broker- dealer registered under this chapter or an issuer that is offering, selling, or purchasing its securities in this State. (d) It is unlawful for a broker-dealer, or an issuer engaged in offering, selling, or purchasing securities in this State, to employ or associate with an agent who transacts business in this State on behalf of broker- dealers or issuer unless the agent is registered under subsection (a) or exempt from registration under subsection (b). (e) An individual may not act as an agent for more than one broker-dealer or more than one issuer at a time, unless the broker-dealers or the issuers for which the agent acts are affiliated by direct or indirect common control or are authorized by rule or order under this chapter. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 94.

(a) It is unlawful for a person to transact business in this State as an investment adviser unless the person is registered under this chapter as an investment adviser or is exempt from registration as an investment adviser under subsection (b). (b) The following persons are exempt from the registration requirement of subsection (a): (1) person without a place of business in this State that is registered under the securities act of the state in which the person has its principal place of business if its only clients in this State are: (A) federal covered investment advisers, investment advisers registered under this chapter, or broker-dealers registered under this chapter; (B) institutional investors; (C) bona fide preexisting clients whose principal places of residence are not in this State if the investment adviser is registered under the securities act of the State in which the clients maintain principal places of residence; or (D) any other client exempted by rule or order under this chapter; (2) a person without a place of business in this State if the person has had, during the preceding 12 months, not more than five clients that are resident in this State in addition to those specified under paragraph (1); or (3) any other person exempted by rule or order under this chapter. (c) It is unlawful for an investment adviser, directly or indirectly, to employ or associate with an individual to engage in an activity related to investment advice in this State if the registration of the individual is suspended or revoked, or the individual is barred from employment or association with an investment adviser, federal covered investment adviser, or broker-dealer by an order under this chapter, the Securities and Exchange Commission, or a self regulatory organization, unless the investment adviser did not know, and in the exercise of reasonable care could not have known, of the suspension, revocation, or bar. Upon request from the investment adviser and for good cause shown, the Administrator, by order, may waive in whole or in part, the application of the prohibitions of this subsection to the investment adviser. (d) It is unlawful for an investment adviser to employ or associate with an individual required to be registered under this chapter as an investment adviser representative who transacts business in this State on behalf of the investment adviser unless the individual is registered under section 634(a) or is exempt from registration under section 634(b). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 95.

Exemptions (a) It is unlawful for an individual to transact business in this State as an investment adviser representative unless the individual is registered under this chapter as an investment adviser representative or is exempt from registration as an investment adviser under subsection (b). (b) The following individuals are exempt from the registration requirement of subsection (a): (1) an individual who is employed by or associated with an investment adviser that is exempt from registration under section 633(b) or a federal covered investment adviser that is excluded from the notice filing requirements of section 635; and (2) any other individual exempted by rule or order under this chapter. (c) The registration of an investment adviser representative is not effective while the investment adviser representative is not employed by or associated with an investment adviser registered under this chapter or a federal covered investment adviser that has made or is required to make a notice filing under section 635. (d) An individual may transact business as an investment adviser representative for more than one investment adviser or federal covered investment adviser unless a rule or order under this chapter prohibits or limits an individual from acting as an investment adviser representative for more than one investment adviser or federal covered investment adviser. (e) It is unlawful for an individual acting as an investment adviser representative, directly or indirectly, to conduct business in this State on behalf of an investment adviser or a federal covered investment adviser if the registration of the individual as an investment adviser representative is suspended or revoked or the individual is barred from employment or association with an investment adviser or a federal covered investment adviser by an order under this chapter, the Securities and Exchange Commission, or a self- regulatory organization. Upon request from a federal covered investment adviser and for good cause shown, the Administrator, by order, may waive in whole or in part, the application of the prohibitions of this subsection to the investment adviser. (f) An investment adviser registered under this chapter, a federal covered investment adviser that has filed a notice under section 635, or a broker-dealer registered under this chapter, is not required to employ or associate with an individual as an investment adviser representative if the only compensation paid to the individual for a referral of investment advisory clients is paid to an investment adviser registered under this chapter, a federal covered investment adviser who has filed a notice under section 635, or a broker- dealer registered under this chapter with which the individual is employed or associated as an investment adviser representative. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 96.

(a) Except with respect to a federal covered investment adviser described in subsection (b), it is unlawful for a federal covered investment adviser to transact business in this State unless the federal covered investment adviser complies with subsection (c). (b) The following federal covered investment advisers are not required to comply with subsection (c): (1) a federal covered investment adviser without a place of business in this State if its only clients in this State are: (A) federal covered investment advisers, investment advisers registered under this chapter, and broker-dealers registered under this chapter; (B) institutional investors; (C) bona fide preexisting clients whose principal places of residence are not in this State; or (D) other clients specified by rule or order under this chapter; (2) a federal covered investment adviser without a place of business in this State if the person has had, during the preceding 12 months, not more than five clients that are residents of this State in addition to those specified under paragraph (1); and (3) any other person excluded by rule or order under this chapter. (c) A person acting as a federal covered investment adviser, not excluded under subsection (b), shall file a notice, a consent to service of process complying with section 671, and such records that have been filed with the Securities and Exchange Commission under the Investment Advisers Act of 1940 required by rule or order under this chapter and pay the fees specified in section 640(e). (d) The notice under subsection (c) becomes effective upon its filing. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 97.

Investment Adviser Representatives (a) A person shall register as broker-dealer, agent, investment adviser, or investment adviser representative by filing an application and a consent to service of process complying with section 671, and paying the fee specified in section 640 and any reasonable fees charged by the designee of the Administrator for processing the filing. Each application must contain: (1) the information required for the filing of a uniform application; and (2) upon request by the Administrator, any other financial or other information that the Administrator determines is appropriate. (b) If the information contained in an application that is filed under subsection (a) is or becomes inaccurate or incomplete in any material respect, the registrant shall promptly file a correcting amendment. (c) If an order is not in effect and no proceeding is pending under section 642, registration becomes effective at noon on the 45th day after a completed application is filed unless the registration is denied. A rule or order under this chapter may set an earlier effective date or may defer the effective date until noon on the 45th day after the filing of any amendment completing the application. (d) A registration is effective until midnight on December 31 of the year for which the application for registration is filed. Unless an order is in effect under section 642, a registration may be automatically renewed each year by filing such records as are required by rule or order under this chapter, by paying the fee specified in section 640, and by paying costs charged by the designee of the Administrator for processing the filings. (e) A rule or order under this chapter may impose such other conditions, not inconsistent with the National Securities Markets Improvement Act of 1996. An order under this chapter may waive in whole or in part specific requirements in connection with registration as are appropriate in the public interest and for the protection of investors. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 98.

Investment Adviser (a) A broker-dealer or investment adviser may succeed to the current registration of another broker-dealer or investment adviser or a notice filing of a federal covered investment adviser, and a federal covered investment adviser may succeed to the current registration of an investment adviser or notice filing of another federal covered investment adviser, by filing as a successor an application for registration pursuant to section 631 or 633, or a notice pursuant to section 635, for the unexpired portion of the current registration or notice filing. (b) A broker-dealer or investment adviser that changes its form of organization or state of incorporation or organization may continue its registration by filing an amendment to its registration if the change does not involve a material change in its financial condition or management. The amendment becomes effective when filed or upon a date designated by the registrant in its filing. The new organization is a successor to the original registrant for the purposes of this chapter. If there is a material change in financial condition or management, the broker-dealer or investment adviser shall file a new application for registration. Any predecessor registered under this chapter shall stop conducting its securities business other than winding down transactions and shall file for withdrawal of broker-dealer or investment adviser registration within 45 days after filing its amendment to effect succession. (c) A broker-dealer or investment adviser that changes its name may continue its registration by filing an amendment to its registration. The amendment becomes effective when filed or upon a date designated by the registrant. (d) A change of control of a broker-dealer or investment adviser may be made in accordance with a rule or order under this chapter. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 98.

Investment Adviser Representative and Transfer of Employment Or Association (a) If an agent registered under this chapter terminates employment by or association with a broker-dealer or issuer, or if an investment adviser representative registered under this chapter terminates employment by or association with an investment adviser or federal covered investment adviser, or if either registrant terminates activities that require registration as an agent or investment adviser representative, the broker- dealer, investment adviser, or federal covered investment adviser shall promptly file a notice of termination. If the registrant learns that the broker-dealer, issuer, investment adviser, or federal covered investment adviser has not filed the notice, the registrant may do so. (b) If an agent registered under this chapter terminates employment by or association with a broker-dealer registered under this chapter and begins employment by or association with another broker-dealer registered under this chapter, or if an investment adviser representative registered under this chapter terminates employment by or association with an investment adviser registered under this chapter, or a federal covered investment adviser, who has filed a notice under section 635 and begins employment by or association with another investment adviser registered under this chapter or a federal covered investment adviser, who has filed a notice under section 635, then upon the filing by or on behalf of the registrant, within 30 days after the termination, of an application for registration that complies with the requirement of section 636(a) and payment of the filing fee required under section 640, the registration of the agent or investment adviser representative, is: (1) immediately effective as of the date of the completed filing if the agent's Central Registration Depository record or successor record or the investment adviser representative's Investment Adviser Registration Depository record or successor record does not contain a new or amended disciplinary disclosure within the previous 12 months; or (2) temporarily effective as of the date of the completed filing if the agent's Central Registration Depository record or the investment adviser representative's Investment Advisor Registration Depository record contains a new or amended disciplinary disclosure within the preceding 12 months. (c) The Administrator may withdraw a temporary registration if there are or were grounds for discipline under section 642 and the Administrator does so within 30 days after the filing of the application. If the Administrator does not withdraw the temporary registration within the 30 day period, registration becomes automatically effective on the 31st day after filing. (d) The Administrator may prevent the effectiveness of a transfer of an agent or investment adviser representative under subsection (b)(1) or (2) based on the public interest and the protection of investors. (e) If the Administrator determines that a registrant or applicant for registration is no longer in existence or has ceased to act as a broker-dealer, agent, investment adviser, or investment adviser representative, or is the subject of an adjudication of incapacity or is subject to the control of a committee, conservator, or guardian, or cannot reasonably be located, a rule or order under this chapter may require the registration be canceled or terminated or the application denied. The Administrator may reinstate a canceled or terminated registration, with or without hearing, and may make the registration retroactive. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 99.

Advisers, and Investment Adviser Representatives Withdrawal of registration by a broker-dealer, agent, investment adviser, or investment adviser representative becomes effective 60 days after filing of the application to withdraw or within such shorter period as required by rule or order under this chapter unless a revocation or suspension proceeding is pending when the application is filed. If a proceeding is pending, withdrawal becomes effective when and upon such conditions as required by rule or order under this chapter. The Administrator may institute a revocation or suspension proceeding under section 642 within one year after the withdrawal became effective automatically and issue a revocation or suspension order as of the last date on which registration was effective if a proceeding is not pending. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 100.

(a) A person shall pay a fee of $200 when initially filing an application as a broker-dealer for registration, and a fee of $50 when filing a renewal of registration as a broker-dealer. If the filing results in a denial or withdrawal, the Administrator shall retain the entire fee. (b) The fee for an individual is $50 when filing an application for registration as an agent, a fee of $50 when filing a renewal of registration as an agent, and a fee of $50 when filing for a change of registration as an agent. If the filing results in a denial or withdrawal, the Administrator shall retain the entire fee. (c) A person shall pay a fee of $200 when filing an application for registration as an investment adviser, and a fee of $100 when filing a renewal of registration as an investment adviser. If the filing results in a denial or withdrawal, the Administrator shall retain the entire fee. (d) The fee for an individual is $50 when filing an application for registration as an investment adviser representative, a fee of $50 when filing a renewal of registration as an investment adviser representative, and a fee of $50 when filing a change of registration as an investment adviser representative. If the filing results in a denial or withdrawal, the Administrator shall retain the entire fee. (e) A federal covered investment adviser required to file a notice under section 635, shall pay an initial notice fee of $100 and an annual notice fee of $50. (f) A person required to pay a filing or notice fee under this section may transmit the fee through or to a designee as a rule or order requires under this chapter. (g) An investment adviser representative who is registered as an agent under section 632 and who represents a person that is both registered as a broker-dealer under section 631 and registered as an investment adviser under section 633 or required as a federal covered investment adviser to make a notice filing under section 635 is not required to pay an initial or annual registration fee for registration as an investment adviser representative. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 101; amended Mar. 5, 2005, No. 6727, § 21(c), (d), Sess. L. 2005, p. 64.

(a) Subject to Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. Section78o(h)) or Section 222 of the Investment Advisers Act of 1940 ( 15 U.S.C. Section 806 -22 ), a rule or order under this chapter may establish minimum financial requirements for broker-dealers registered or required to be registered under this chapter and investment advisers registered or required to be registered under this chapter. (b) Subject to Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. Section78o(h)) or Section 222(b) of the Investment Advisers Act of 1940 ( 15 U.S.C. Section 80b-22 ), a broker-dealer registered or required to be registered under this chapter and an investment adviser registered or required to be registered under this chapter shall file such financial reports as are required by rule or order under this chapter. If the information contained in a record filed under this subsection is or becomes inaccurate or incomplete in any material respect, the registrant shall promptly file a correcting amendment. (c) Subject to Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. Section78o(h)) or Section 222 of the Investment Advisers Act of 1940 ( 15 U.S.C. Section 80b-22 ). (1) a broker-dealer registered or required to be registered under this chapter and an investment adviser registered or required to be registered under this chapter shall make and maintain the accounts, correspondence, memoranda, papers, books, and other records required by the rule adopted or order issued under this chapter; (2) broker-dealer records required to be maintained under paragraph paragraph (1)intained in any form of data storage acceptable under Section 17(a) of the Securities Exchange Act of 1934 (15 U.S.C. Section78q(a)) if they are readily accessible to the Administrator; and (3) investment adviser records required to be maintained under paragraph (1) may be maintained in any form of data storage required by rule or order under this chapter. (d) The records of a broker-dealer registered or required to be registered under this chapter and of an investment adviser registered or required to be registered under this chapter are subject to such reasonable periodic, special, or other audits or inspections by a representative of the Administrator, within or without this State, as the Administrator considers necessary or appropriate in the public interest and for the protection of investors. An audit or inspection may be made at any time and without prior notice. The Administrator may copy and remove for audit or inspection, copies of all records the Administrator reasonably considers necessary or appropriate to conduct the audit or inspection. The Administrator may assess a reasonable charge for conducting an audit or inspection under this subsection. (e) Subject to Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. Section78o(h)) or Section 222 of the Investment Advisers Act of 1940 ( 15 U.S.C. Section 80b-22 ), a rule or order under this chapter may require each broker-dealer and investment adviser that has custody of or discretionary authority over funds or securities of a client to obtain insurance, or post a bond or other satisfactory form of security in an amount established by rule adopted or order issued by the Administrator, but shall not exceed $25,000. The Administrator may determine the requirements of the insurance, bond, or other satisfactory form of security. Insurance or a bond or other satisfactory form of security may not be required of a broker-dealer registered under this chapter whose net capital exceeds or, of an investment adviser registered under this chapter whose minimum financial requirements exceed, the amounts required by rule or order under this chapter. The insurance, bond, or other satisfactory form of security must permit an action by a person to enforce any liability on the insurance, bond, or other satisfactory form of security if commenced within the time limitations in section 659(j)(2). (f) Subject to Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. Section78o(h)) or Section 222 of the Investment Advisers Act of 1940 ( 15 U.S.C. Section 80b-22 ), an agent may not have custody of funds or securities of a customer except under the supervision of a broker-dealer and an investment adviser representative may not have custody over funds or securities of a client except under the supervision of an investment adviser or federal covered investment adviser. A rule or order under this chapter may prohibit, limit, or impose conditions on a broker-dealer regarding custody of funds or securities of a customer and on an investment adviser regarding custody of securities or funds of a client. (g) With respect to an investment adviser registered or required to be registered under this chapter, a rule or order under this chapter may require that information or other record be furnished or disseminated to clients or prospective clients in this State as necessary or appropriate in the public interest and for the protection of investors and advisory clients. (h) A rule or order under this chapter may require any individual registered under section 632 or 634 to participate in a continuing education program approved by the Securities and Exchange Commission and administered by a self-regulatory organization or, in the absence of such a program, a rule or order under this chapter may require continuing education for an individual registered under section 634. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 101.

Restriction, Condition, Or Limitation of Registration (a) If the administrator finds that the order is in the public interest and subsection (d) authorizes the action, an order issued under this chapter may deny an application, or may condition or limit registration of an applicant to be a broker-dealer, agent, investment adviser, or investment adviser representative, and, if the applicant is a broker-dealer or investment adviser, of a partner, officer, director, or person having a similar status or performing similar functions, or a person directly or indirectly in control, of the broker- dealer or investment adviser. (b) If the administrator finds that the order is in the public interest and subsection (d) authorizes the action, an order issued under this chapter may revoke, suspend, condition, or limit the registration of a registrant and, if the registrant is a broker-dealer or investment adviser, of a partner, officer, director, or person having a similar status or performing similar functions, or a person directly or indirectly in control, of the broker-dealer or investment adviser. However, the administrator may not: (1) institute a revocation or suspension proceeding under this subsection based on an order issued under a law of another State that is reported to the administrator or a designee of the administrator more than one year after the date of the order on which it is based; or (2) under subsection (d)(5)(A) or (B), issue an order on the basis of an order issued under the securities act of another State unless the other order was based an conduct for which subsection (d) would authorize the action had the conduct occurred in this State. (c) If the administrator finds that the order is in the public interest and subsection (d)(1) through (6), (8), (9), (10), or (12) and (13) authorizes the action, an order under this chapter may censure, impose a bar, or impose a civil penalty in an amount not to exceed a maximum of $5,000 for a single violation or $50,000 for more than one violation, on a registrant, and, if the registrant is a broker-dealer or investment adviser, a partner, officer, director, or person having a similar status or performing similar functions, or a person directly or indirectly in control, of the broker-dealer or investment adviser. (d) A person may be disciplined under subsections (a) through (c) if the person: (1) has filed an application for registration in this State under this chapter or the predecessor act within the previous 10 years, which, as of the effective date of registration or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained a statement that, in light of the circumstances under which it was made, was false or misleading with respect to a material fact; (2) willfully violated or willfully failed to comply with this chapter or the predecessor act or a rule adopted or order issued under this chapter or the predecessor act within the previous 10 years; (3) has been convicted of a felony or within the previous 10 years has been convicted of a misdemeanor involving a security, a commodity future or option contract, or an aspect of a business involving securities, commodities, investments, franchises, insurance, banking, or finance; (4) is enjoined or restrained by a court of competent jurisdiction in an action instituted by the administrator under this chapter or the predecessor act, a State, the Securities and Exchange Commission, or the United States from engaging in or continuing an act, practice, or course of business involving an aspect of a business involving securities, commodities, investments, franchises, insurance, banking, or finance; (5) is the subject of an order, issued after notice and opportunity for hearing by: (A) the securities, depository institution, insurance, or other financial services regulator of a State or by the Securities and Exchange Commission or other federal agency denying, revoking, barring, or suspending registration as broker-dealer, agent, investment adviser, federal covered investment adviser, or investment adviser representative; (B) the securities regulator of a State or the Securities and Exchange Commission against a broker-dealer, agent, investment adviser, investment adviser representative, or federal covered investment adviser; (C) the Securities and Exchange Commission or a self-regulatory organization suspending or expelling the registrant from membership in the self-regulatory organization; (D) a court adjudicating a United States Postal Service fraud order; (E) the insurance regulator of a State denying, suspending, or revoking registration as an insurance agent; or (F) a depository institution regulator suspending or barring the person from the depository institution business; (6) is the subject of an adjudication or determination, after notice and opportunity for hearing, by the Securities and Exchange Commission, the Commodity Futures Trading Commission; the Federal Trade Commission; a federal depository institution regulator, or a depository institution, insurance, or other financial services regulator of a State that the person willfully violated the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Securities Act of 1933the InSecurities Exchange Act of 1934r the Investment Advisers Act of 1940uritieInvestment Company Act of 1940e, or a federal or Exchange Actder which a business involving investments, franchises, insurance, banking, or finance is regulated; (7) is insolvent, either because the person's liabilities exceed the person's assets or because the person cannot meet the person's obligations as they mature, but the administrator may not enter an order against an applicant or registrant under this paragraph without a finding of insolvency as to the applicant or registrant; (8) refuses to allow or otherwise impedes the administrator from conducting an audit or inspection under section 641(d) or refuses access to a registrant's office to conduct an audit or inspection under section 641(d); (9) has failed to reasonably supervise an agent, investment adviser representative, or other individual, if the agent, investment adviser representative, or other individual was subject to the person's supervision and committed a violation of this [Act] or the predecessor act or rule adopted or order issued under this [Act] or the predecessor act within the previous 10 years; (10) has not paid the proper filing fee within 30 days after having been notified by the administrator of a deficiency, but the administrator shall vacate an order under this paragraph when the deficiency is corrected; (11) after notice and opportunity for a hearing, has been found within the previous 10 years: (A) by a court of competent jurisdiction to have willfully violated the laws of a foreign jurisdiction under which the business of securities, commodities, investment, franchises, insurance, banking, or finance is regulated; (B) to have been the subject of an order of a securities regulator of a foreign jurisdiction denying, revoking, or suspending the right to engage in the business of securities as a broker-dealer, agent, investment adviser, investment adviser representative, or similar person; or (C) to have been suspended or expelled from membership by or participation in a securities exchange or securities association operating under the securities laws of a foreign jurisdiction; (12) is the subject of a cease and desist order issued by the Securities and Exchange Commission or issued under the securities, commodities, investment, franchise, banking, finance, or insurance laws of a State; (13) has engaged in dishonest or unethical practices in the securities, commodities, investment, franchise, banking, finance, or insurance business within the previous 10 years; or (14) is not qualified on the basis of factors such as training, experience, and knowledge of the securities business. However, in the case of an application by an agent for a broker-dealer that is a member of a self-regulatory organization or by an individual for registration as an investment adviser representative, a denial order may not be based on this paragraph if the individual has successfully completed all examinations required by subsection (e). The administrator may require an applicant for registration under section 402 or 404 who has not been registered in a State within the two years preceding the filing of an application in this State to successfully complete an examination. (e) A rule adopted or order issued under this chapter may require that an examination, including an examination developed or approved by an organization of securities regulators, be successfully completed by a class of individuals or all individuals. An order issued under this chapter may waive, in whole or in part, an examination as to an individual and a rule adopted under this chapter may waive, in whole or in part, an examination as to a class of individuals if the administrator determines that the examination is not necessary or appropriate in the public interest and for the protection of investors. (f) The administrator may suspend or deny an application summarily; restrict, condition, limit, or suspend a registration; or censure, bar, or impose a civil penalty on a registrant before final determination of an administrative proceeding. Upon the issuance of an order, the administrator shall promptly notify each person subject to the order that the order has been issued, the reasons for the action, and that within 15 days after the receipt of a request in a record from the person the matter will be scheduled for a hearing. If a hearing is not requested and none is ordered by the administrator within 30 days after the date of service of the order, the order becomes final by operation of law. If a hearing is requested or ordered, the administrator, after notice of and opportunity for hearing to each person subject to the order, may modify or vacate the order or extend the order until final determination. (g) An order issued may not be issued under this section, except under subsection (f), without: (1) appropriate notice to the applicant or registrant; (2) opportunity for hearing; and (3) findings of fact and conclusions of law in a record. (h) A person that controls, directly or indirectly, a person not in compliance with this section may be disciplined by order of the administrator under subsections (a) through (c) to the same extent as the noncomplying person, unless the controlling person did not know, and in the exercise of reasonable care could not have known, of the existence of conduct that is a ground for discipline under this section. (i) The administrator may not institute a proceeding under subsection (a), (b), or (c) based solely on material facts actually known by the administrator unless an investigation or the proceeding is instituted within one year after the administrator actually acquires knowledge of the material facts. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 103.

It is unlawful for a person, in connection with the offer, sale, or purchase of security, directly or indirectly: (1) to employ a device, scheme, or artifice to defraud; (2) to make an untrue statement of a material fact or to omit to state a material fact necessary in order to make the statement made, in the light of the circumstances under which it is made, not misleading; or (3) to engage in an act, practice, or course of business that operates or would operate as a fraud or deceit upon another person. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 107.

(a) It is unlawful for a person that advises others, for compensation, either directly or indirectly, or through publications or writings, as to the value of securities or the advisability of investing in, purchasing or selling securities, or that, for compensation and as part of a regular business, issues or promulgates analyses or reports concerning securities: (1) to employ a device, scheme, or artifice to defraud another person; or (2) to engage in an act, practice, or course of business that operates or would operate as a fraud or deceit upon another person. (b) (1) A rule under this chapter may define an act, practice, or course of business of an investment adviser or an investment adviser representative, other than a supervised person of a federal covered investment adviser, as fraudulent, deceptive, or manipulative, and prescribe means reasonably designed to prevent investment advisers and investment adviser representatives, other than supervised persons of a federal covered investment adviser, from engaging in acts, practices, and courses of business defined as fraudulent, deceptive, or manipulative. (2) A rule under this chapter may specify the contents of an investment advisory contract entered into, extended, or renewed by an investment adviser. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 108.

(a) In a civil action or administrative proceeding under this chapter, a person claiming an exemption, exception, preemption, or exclusion has the burden to prove the applicability of the exemption, exception, preemption, or exclusion. (b) In a criminal proceeding under this chapter, a person claiming an exemption, exception, preemption, or exclusion has the burden of going forward with evidence of the claim. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 108.

(a) Except as otherwise provided in subsection (b), a rule or order under this chapter may require the filing of a prospectus, pamphlet, circular, form letter, advertisement, sales literature, or other advertising communication relating to a security or investment advice, addressed or intended for distribution to prospective investors, including clients or prospective clients of a person registered or required to be registered as an investment adviser under this chapter. (b) This section does not apply to sales and advertising literature specified in subsection (a) relating to a federal covered security, a federal covered investment adviser, or a security or transaction exempted by section 611, 612, or 613 except as required pursuant to section 611(7). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 108.

It is unlawful for a person to make or cause to be made, in a record that is used in an action or proceeding or filed under this chapter, a statement that, at the time and in the light of the circumstances under which it is made, is false or misleading in a material respect, or, in connection with the statement, to omit to state a material fact necessary in order to make the statement made, in the light of the circumstances under which it was made, not false or misleading. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 109.

The filing of an application for registration, a registration statement, a notice filing under this chapter, or the registration of a person, the notice filing by a person, or the registration of a security under this chapter does not constitute a finding by the Administrator that a record filed under this chapter is true, complete, and not misleading. The filing or registration or the availability of an exemption, exception, preemption, or exclusion for a security or a transaction does not mean that the Administrator has passed upon the merits or qualifications of, or recommended or given approval to, a person, security, or transaction. It is unlawful to make, or cause to be made, to a purchaser, customer, client, or prospective customer or client, a representation inconsistent with this section. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 109.

A broker-dealer, agent, investment adviser, federal covered investment adviser, or investment adviser representative is not liable to another broker-dealer, agent, investment adviser, federal covered investment adviser, or investment adviser representative for defamation relating to an alleged untrue statement that is contained in a record required by the Administrator, or designee of the Administrator, the Securities and Exchange Commission, or self-regulatory organization, unless it is proven that the person knew, or should have known at the time that the statement was made, that it was false in a material respect or the person acted in reckless disregard of the statement's truth or falsity. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 109.

(a) A person that willfully violates this chapter, or a rule adopted or order issued under this chapter, except section 654 or the notice filing requirements of section 622 or 635, or that willfully violates section 655 knowing the statement made to be false or misleading in a material respect, upon conviction, shall be fined not more than $1,000,000 or imprisoned not more than 10 years, or both. An individual convicted of violating a rule or order under this chapter may be fined, but may not be imprisoned, if the individual did not have knowledge of the rule or order. (b) The Attorney General with or without a reference from the Administrator, may institute appropriate criminal proceedings under this chapter. (c) This chapter does not limit the power of this State to punish a person for conduct that constitutes a crime under other laws of this State. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 109.

(a) Enforcement of civil liability under this section is subject to the Securities Litigation Uniform Standards Act of 1998. (b) A person is liable to the purchaser if the person sells a security in violation of section 621, or by means of an untrue statement of a material fact or an omission to state a material fact necessary in order to make the statement made, in light of the circumstances under which it is made, not misleading, the purchaser not knowing the untruth or omission, and the seller not sustaining the burden of proof that the seller did not know and, in the exercise of reasonable care, could not have known of the untruth or omission. An action under this subsection is governed by the following: (1) The purchaser may maintain an action at law or in equity to recover the consideration paid for the security, less the amount of any income received on the security, and interest at the legal rate of interest as provided by Title 11, section 951, Virgin Islands Code Virgin Islands Codehe date of the purchase, costs, and reasonable attorneys' fees determined by the court, upon the tender of the security, or for actual damages as provided in paragraph (3). (2) The tender referred to in paragraph paragraph (1)de any time before entry of judgment. Tender requires only notice in a record of ownership of the security and willingness to exchange the security for the amount specified. A purchaser that no longer owns the security may recover actual damages as provided in paragraph (3). (3) Actual damages in an action arising under this subsection are the amount that would be recoverable upon a tender less the value of the security when the purchaser disposed of it, an interest at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the date of purchase, costs, and reasonable attorneys' fees determined by the court. (c) A person is liable to the seller if the person buys a security by means of an untrue statement of a material fact or omission to state a material fact necessary in order to make the statement made, in light of the circumstances under which it is made, not misleading, the seller not knowing of the untruth or omission, and the purchaser not sustaining the burden of proof that the purchaser did not know, and in the exercise of reasonable care, could not have known of the untruth or omission. An action under this subsection is governed by the following: (1) The seller may maintain an action to recover the security, and any income received on the security, costs, and reasonable attorney's fees determined by the court, upon the tender of the purchase price, or for actual damages as provided in paragraph (3). (2) The tender referred to in paragraph paragraph (1)e made any time before entry of judgment. Tender requires only notice in a record of the present ability to pay the amount tendered and willingness to take delivery of the security for the amount specified. If the purchaser no longer owns the security, the seller may recover actual damages as provided in paragraph (3). (3) Actual damages in an action arising under this subsection are the difference between the price at which the security was sold and the value the security would have had at the time of the sale in the absence of the purchaser's conduct causing liability, and interest at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the date of sale of the security, costs, and reasonable attorneys' fees determined by the court. (d) A person acting as a broker-dealer or agent that sells or buys a security in violation of section 631(a), 632(a), or 656 is liable to the customer. The customer, if a purchaser, may maintain an action for recovery of actual damages as specified in subsections (b)(1) through (3); or, if a seller, a remedy as specified in subsections (c)(1) through (3). (e) A person acting as an investment adviser or investment adviser representative that provides investment advice for compensation in violation of section 633(a), 634(a), or 656 is liable to the client. The client may maintain an action to recover the consideration paid for the advice, interest at the legal rate of interest as provided by Title 11, section 951, Virgin Islands Code, from the date of payment, costs, and reasonable attorney's fees determined by the court. (f) A person that receives directly or indirectly any consideration for providing investment advice to another person and that employs a device, scheme, or artifice to defraud the other person or engages in an act, practice, or course of business that operates or would operate as a fraud or deceit on the other person, is liable to the other person. An action under this subsection is governed by the following: (1) The person defrauded may maintain an action to recover the consideration paid for the advice and the amount of any actual damages caused by the fraudulent conduct, interest at the legal rate of interest as provided by Title 11, section 951, Virgin IslVirgin Islands Code date of the fraudulent conduct, costs, and reasonable attorneys' fees determined by the court, less the amount of any income received as a result of the fraudulent conduct. (2) This subsection does not apply to a broker-dealer or its agents if the investment advice provided is solely incidental to transacting business as a broker-dealer and no special compensation is received for the investment advice. (g) The following persons are liable jointly and severally with and to the same extent as persons liable under subsections (b) through (f): (1) a person that directly or indirectly controls a person liable under subsections (b) through (f), unless the controlling person sustains the burden of proof that the person did not know, and in the exercise of reasonable care could not have known, of the existence of the facts by reason of which the liability is alleged to exist; (2) an individual who is a managing partner, executive officer, or director of a person liable under subsections (b) through (f), including each individual having a similar status or performing similar functions, unless the individual sustains the burden of proof that the individual did not know and, in the exercise of reasonable care could not have known, of the existence of the facts by reason of which the liability is alleged to exist; (3) an individual who is an employee of or associated with a person liable under subsections (b) through (f) and who materially aids the conduct giving rise to the liability, unless the individual sustains the burden of proof that the individual did not know and, in the exercise of reasonable care could not have known, of the existence of the facts by reason of which the liability is alleged to exist; and (4) a person that is a broker-dealer, agent, investment adviser, or investment adviser representative that materially aids the conduct giving rise to the liability under subsections (b) through (f), unless the person sustains the burden of proof that the person did not know and, in the exercise of reasonable care could not have known, of the existence of the facts by reason of which liability is alleged to exist. (h) A person liable under this section has a right of contribution as in cases of contract against any other person liable under this section for the same conduct. (i) A cause of action under this section survives the death of an individual who might have been a plaintiff or defendant. (j) A person may not obtain relief: (1) under subsection (b) for violation of section 621, or under subsection (d) or (e), unless the action is commenced within one year after the violation occurred; or (2) under subsection (b), other than for violation of section 621, or under subsection (c) or (f), unless the action is commenced within the earlier of two years after discovery of the facts constituting the violation and five years after such violation. (k) A person that has made or engaged in the performance of a contract in violation of this chapter or a rule adopted or order issued under this chapter, or that has acquired a purported right under the contract with knowledge of the conduct by reason of which its making or performance was in violation of this chapter, may not base an action on the contract. (l) A condition, stipulation, or provision binding a person purchasing or selling a security or receiving investment advice to waive compliance with this chapter or a rule adopted or order issued under this chapter is void. (m) The rights and remedies provided by this chapter are in addition to any other rights or remedies that may exist, but this chapter does not create a cause of action not specified in this section or section 641(e). History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 110.

A purchaser, seller, or recipient of investment advice may not maintain an action under section 659 if: (1) the purchaser, seller, or recipient of investment advice receives in a record, before the action is instituted: (A) an offer stating the respect in which liability under section 659 may have arisen and fairly advising the purchaser, seller, or recipient of investment advice of that person's rights in connection with the offer, and any financial or other information necessary to correct all material misrepresentations or omissions in the information that was required by this chapter to be furnished to that person at the time of the purchase, sale, or investment advice; (B) if the basis for relief under this section may have been a violation of section 659(b), an offer to repurchase the security for cash, payable on delivery of the security, equal to the consideration paid, and interest, at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the date oVirgin Islands Codes the amount of any income received on the security, or, if the purchaser no longer owns the security, an offer to pay the purchaser upon acceptance of the offer damages in an amount that would be recoverable upon a tender, less the value of the security when the purchaser disposed of it, and interest, at the legal rate of interest as provided by Title 11, section 951, Virgin Islands Code from the date of theVirgin Islands Codesh equal to the damages computed in the manner provided in this subsection; (C) if the basis for relief under this section may have been a violation of section 659(c), an offer to tender the security, on payment by the seller of an amount equal to the purchase price paid, less income received on the security by the purchaser and interest, at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the Virgin Islands Coder if the purchaser no longer owns the security, an offer to pay the seller upon acceptance of the offer, in cash, damages in the amount of the difference between the price at which the security was purchased and the value the security would have had at the time of the purchase in the absence of the purchaser's conduct that may have caused liability and interest, at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the date of the sale; (D) if the basis for relief under this section may have been a violation of section 659(d); and if the customer is a purchaser, an offer to pay as specified in subparagraph (B); or, if the customer is a seller, an offer to tender or to pay as specified in subparagraph (C); (E) if the basis for relief under this section may have been a violation of section 659(e), an offer to reimburse in cash the consideration paid for the advice and interest, at the legal rate of interest, as provided by Title 11, section 951, Virgin IslVirgin Islands Code date of payment; or (F) if the basis for relief under this section may have been a violation of section 659(f), an offer to reimburse in cash the consideration paid for the advice, the amount of any actual damages that may have been caused by the conduct, and interest, at the legal rate of interest, as provided by Title 11, section 951, Virgin Islands Code, from the date of the violation causing the loss; (2) the offer under paragraph 1 states that it must be accepted by the purchaser, seller, or recipient of investment advice within 30 days after the date of its receipt by the purchaser, seller, or recipient of investment advice or any shorter period, of not less than three days, that the administrator, by order, specifies; (3) the offeror has the present ability to pay the amount offered or to tender the security under paragraph (1); (4) the offer under paragraph (1) is delivered to the purchaser, seller, or recipient of investment advice, or sent in a manner that ensures receipt by the purchaser, seller, or recipient of investment advice; and (5) the purchaser, seller, or recipient of investment advice that accepts the offer under paragraph (1) in a record within the period specified under paragraph (2) is paid in accordance with the terms of the offer. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 113.

(a) The Administrator shall administer this chapter. (b) It is unlawful for the Administrator or officer, employee or designee of the Administrator to use for personal benefit or the benefit of others records or other information obtained by or filed with the Administrator that are not public under section 667(b). This chapter does not authorize the Administrator or an officer, employee or designee of the Administrator to disclose the record or information, except in accordance with section 662, 667(c), or 668. (c) This chapter does not create or diminish any privilege or exemption that exists at common law, by statute, rule or otherwise. (d) The Administrator may develop and implement investor education initiatives to inform the public about investing in securities, with particular emphasis on the prevention and detection of securities fraud. In developing and implementing these initiatives, the Administrator may collaborate with public and nonprofit organizations with an interest in investor education. The Administrator may accept grants or donations from a person that is not affiliated with the securities industry or from a nonprofit organization, regardless of whether or not the organization is affiliated with the securities industry, to develop and implement investor education initiatives. This subsection does not authorize the Administrator to require participation or monetary contributions of a registrant in an investor education program. (e) There is created a Fund within the Treasury of the Virgin Islands known as the Securities Investor Education and Training Fund to provide funds for the purposes specified in paragraph (d). All monies received by the State by reason of civil penalties pursuant to this chapter shall be deposited in the Securities Investor Education and Training Fund. The Fund shall also consist of monies appropriated thereto by the Legislature. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 114.

(a) The Administrator may: (1) conduct public or private investigations within or outside of this State that the Administrator considers necessary or appropriate to determine whether any person has violated, is violating, or is about to violate this chapter or a rule adopted or order issued under this chapter, or to aid in the enforcement of this chapter or in the adoption of rules and forms under this chapter; (2) require or permit a person to testify, file a statement, or produce a record, under oath or otherwise as the Administrator determines, as to all the facts and circumstances concerning a matter to be investigated or about which an action or proceeding is to be instituted; and (3) publish information concerning an action, proceeding, or an investigation under, or a violation of, this chapter or a rule adopted or order issued under this chapter if the Administrator determines it is necessary or appropriate in the public interest and for the protection of investors. (b) For the purpose of an investigation under this chapter, the Administrator or its designated officer may administer oaths and affirmations, subpoena witnesses, seek compulsion of attendance, take evidence, require the filing of a statement, and require the production of any records that the Administrator considers relevant or material to the investigation. (c) If a person fails to appear or refuses to testify, file a statement, produce records, or otherwise fails to obey a subpoena as required by the Administrator under this chapter, the Administrator may refer the matter to the Attorney General, who may apply to the Superior Court of the Virgin Islands or a court of another state to enforce compliance. The court may: (1) hold the person in contempt; (2) order the person to appear before the Administrator; (3) order the person to testify about the matter under investigation or in question; (4) order the production of records; (5) grant injunctive relief, including restricting or prohibiting the offer or sale of securities or the providing of investment advice; (6) impose a civil penalty not greater than $10,000 for each violation; and (7) grant any other necessary or appropriate relief. (d) This section does not preclude a person from applying to the Superior Court of the Virgin Islands or a court of another State for relief from a request to appear, testify, file a statement, produce records, or obey a subpoena. (e) An individual is not excused from attending, testifying, filing a statement, producing a record or other evidence, or obeying a subpoena of the Administrator under this chapter or in an action commenced or proceeding instituted by the Administrator under this chapter on the ground that the required testimony, statement, record, or other evidence, directly or indirectly, may tend to incriminate the individual or subject the individual to a criminal fine, penalty or forfeiture. If the individual refuses to testify or file a statement, produce a record or other evidence on the basis of the individual's privilege against self- incrimination, the Administrator may apply to the Superior Court of the Virgin Islands to compel the testimony, the filing of the statement, the production of the record or the giving of other evidence. The testimony, record, or other information compelled under such an order may not be used, directly or indirectly, against the individual in a criminal case, except in a prosecution for perjury or contempt or otherwise failing to comply with the order. (f) At the request of the securities regulator of another state or a foreign jurisdiction, the Administrator may provide assistance if the requesting regulator states that it is conducting an investigation to determine whether a person has violated, is violating, or is about to violate a law or rule of the other state or foreign jurisdiction relating to securities matters which the requesting regulator administers or enforces. The Administrator may provide the assistance by using the authority to investigate and the powers conferred by this section as the Administrator determines is necessary or appropriate. The assistance may be provided without regard to whether the facts stated in the request would also constitute a violation of this chapter or other law of this State if occurring in this State. In deciding whether to provide the assistance, the Administrator may consider whether the requesting regulator is permitted and has agreed to provide assistance reciprocally within its state or foreign jurisdiction to the Administrator on securities matters when requested; whether compliance with the request would violate or prejudice the public policy of this State; and the availability of resources and employees of the Administrator to carry out the request for assistance. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 115.

(a) If it appears to the Administrator that a person has engaged, is engaging, or is about to engage in an act, practice, or course of business constituting a violation of this chapter or a rule adopted or order issued under this chapter, or that a person has, is, or is about to engage in an act, practice, or course of business that materially aids a violation of this chapter or a rule adopted or order issued under this chapter, the Administrator may maintain an action in the Superior Court of the Virgin Islands to enjoin the act, practice, or course of business and to enforce compliance with this chapter or a rule adopted or order issued under this chapter. (b) In an action under this section and upon a proper showing, the court may: (1) issue a permanent or temporary injunction, restraining order or a declaratory judgment; (2) issue an order for other appropriate or ancillary relief, which may include: (A) an asset freeze, accounting, writ of attachment, writ of general or specific execution, and an appointment of a receiver or conservator, that may be the Administrator, for the defendant or the defendant's assets; (B) ordering the Administrator to take charge and control of a defendant's property, including investment accounts and accounts in a depository institution, rents, and profits; to collect debts; and to acquire and dispose of property; (C) the imposition of a civil penalty up to a maximum of $10,000 for each violation; an order of rescission, restitution, or disgorgement directed to a person that has engaged in an act, practice, or course of business constituting a violation of this chapter or an rule adopted or order issued under this chapter; and (D) an order for the payment of prejudgment and post judgment interest; or (3) granting other relief that the court considers appropriate. (c) The Administrator may not be required to post a bond in an action or proceeding under this chapter. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 117.

(a) If the Administrator determines that a person has engaged, is engaging, or is about to engage, in an act, practice, or course of business constituting a violation of this chapter or a rule adopted or order issued under this chapter, or that a person has, is, or is about to materially aid an act, practice, or course of business constituting a violation of this chapter or a rule adopted or order issued under this chapter, the Administrator may: (1) issue an order directing the person to cease and desist from engaging in the act, practice, or course of business or to take other action necessary or appropriate to comply with this chapter; (2) issue an order denying, suspending, revoking or conditioning the exemptions for a broker-dealer under section 631(b)(1)(D) or (F) or an investment adviser under section 633(b)(1)(C); or (3) issue an order under section 614. (b) An order under subsection (a) is effective on the date of issuance. Upon issuance of the order, the Administrator shall promptly serve each person subject to the order with a copy of the order and a notice that the order has been entered. The order shall include a statement whether the Administrator will seek a civil penalty or costs of the investigation, a statement of the reasons for the order, and notice that, within 15 days after receipt of a request in a record from the person, the matter will be scheduled for a hearing. If a person subject to the order does not request a hearing and none is ordered by the Administrator within 30 days after the date of service of the order, the order becomes final as to that person. If a hearing is requested or ordered, the Administrator, after notice of and opportunity for hearing to each person subject to the order, may modify or vacate the order or extend it until final determination. (c) If a hearing is requested or ordered pursuant to subsection (b), a hearing shall be held. A final order may not be issued unless the Administrator makes findings of fact and conclusions of law. The final order may make final, vacate, or modify the order issued under subsection (a). (d) In a final order, the Administrator may impose a civil penalty up to a maximum of $5,000 for a single violation or up to $250,000 for more than one violation. (e) In a final order, the Administrator may charge the actual cost of an investigation or proceeding for a violation of this chapter or a rule adopted or order issued under this chapter. (f) If a petition for judicial review of a final order is not filed in accordance with section 669, the Administrator may file a certified copy of the final order with the clerk of a court of competent jurisdiction. The order so filed shall have the same effect as a judgment of the court and may be recorded, enforced, or satisfied in the same manner as a judgment of the court. (g) If a person fails to comply with an order under this section, the Administrator may petition a court of competent jurisdiction to enforce the order. The court may not require the Administrator to post a bond in an action or proceeding under this section. If the court finds, after service and opportunity for hearing, that the person is not in compliance with the order, the court may adjudge the person in civil contempt of the order. The court may impose a further civil penalty against the person for contempt in an amount not greater than $1,000 for each violation, and may grant any other relief the court determines is just and proper in the circumstances. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 118; amended Mar. 5, 2005, No. 6727, § 21(e), (f), Sess. L. 2005, p. 64.

(a) The Administrator may: (1) issue forms and orders, and after notice and comment, may adopt and amend rules pursuant to Title 3, ChapterTitle 3rgin IChapter 35, Virgin Islands Codepriate to carry out this chapter, and may repeal rules, including rules and forms governing registration statements, applications, notice filings, reports, and other records; (2) by rule, define terms, whether or not used in this chapter, but those definitions may not be inconsistent with this chapter; and (3) by rule, classify securities, persons, and transactions and adopt different requirements for different classes. (b) A rule or form may not be adopted or amended, or an order issued or amended under this chapter, unless the Administrator finds that the rule, form, order, or amendment is necessary or appropriate in the public interest or for the protection of investors and is consistent with the purposes intended by this chapter. In adopting, amending, and repealing rules and forms, section 668 applies in order to achieve uniformity among the States and coordination with federal laws in the form and content of registration statements, applications, reports, and other records, including in the adoption of uniform rules, forms, and procedures. (c) Subject to Section 15(h) of the Securities Exchange Act and Section 222 of the Investment Advisers Act of 1940, the Administrator may require that a financial statement filed under this chapter be prepared in accordance with generally accepted accounting principles in the United States and comply with other requirements specified by rule or order under this chapter. A rule or order under this chapter may establish: (1) subject to Section 15(h) ofSection 15(h) of the Securities Exchan222t of the Investment Advisors Investment Advisors Act of 1940nt of financial statements required under this chapter; (2) whether unconsolidated financial statements must be filed; and (3) whether required financial statements must be audited by an independent certified public accountant. (d) The Administrator may provide interpretative opinions or may issue determinations that the Administrator will not institute proceeding or action under this chapter against a specified person for engaging in a specified act, practice, or course of business if the determination is consistent with the purposes intended by this chapter. A rule or order under this chapter may assess a reasonable charge for interpretative opinions or determinations that the Administrator will not institute an action or a proceeding under this chapter. (e) A penalty under this chapter may not be imposed for, and liability does not arise from conduct that is engaged in or omitted in good faith believing it conforms to a rule, form, or order of the Administrator under this chapter. (f) A hearing in an administrative proceeding under this chapter must be conducted in public unless the Administrator for good cause consistent with the purposes intended by this chapter determines that the hearing shall not be so conducted. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 119.

(a) The Administrator shall maintain, or designate a person to maintain, a register of applications for registration of securities; registration statements; notice filings, applications for registration of broker- dealers, agents, investment advisers, and investment adviser representatives; notice filings by federal covered investment advisers that are or have been effective under this chapter; notices of claims of exemption from registration or notice filing requirements contained in a record; orders issued under this chapter; and interpretative opinions or no-action determinations issued under this chapter. (b) The Administrator shall make all rules, forms, interpretative opinions, and orders available to the public. (c) The Administrator shall furnish a copy of a record that is a public record or a certification that the public record does not exist to a person that so requests. A rule under this chapter may establish a reasonable charge for furnishing the record or certification. A copy of the record certified or a certificate of its nonexistence by the Administrator is prima facie evidence of a record or its nonexistence. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 120.

(a) Except as otherwise provided in subsection (b), records obtained by the Administrator or filed under this chapter, including a record contained in or filed with any registration statement, application, notice filing, or report, are public records and are available for public examination. (b) The following records are not public records and are not available for public examination under subsection (a): (1) a record obtained by the Administrator in connection with an audit or inspection under section 641(c) or an investigation under section 662; (2) a part of a record filed in connection with a registration statement under sections 621 and 623 through 625 or a record under section 641(d), that contains trade secrets or confidential information if the person filing the registration statement or report has asserted a claim of confidentiality or privilege that is authorized by law; (3) a record that is not required to be provided to the Administrator or filed under this chapter and is provided to the Administrator only on the condition that the information will not be subject to public examination or disclosure; (4) a nonpublic record received from a person specified in section 668(a); (5) any social security number, residential address, unless used as a business address, and residential telephone number, unless used as a business telephone number, contained in a record that is filed; and (6) a record obtained by the Administrator through a designee of the Administrator that a rule or order under this chapter determines has been: (A) expunged from the Administrator's records by that designee, or (B) determined to be nonpublic or nondisclosable by that designee if the Administrator finds that this is in the public interest and for the protection of investors. (c) If disclosure is for the purpose of a civil, administrative, or criminal investigation, action or proceeding or to a person specified in section 668(a), the Administrator may disclose a record obtained in connection with an audit or inspection under section 641(d) or a record obtained in connection with an investigation under section 662. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 121.

(a) The Administrator shall, in its discretion, cooperate, coordinate, consult, and, subject to section 667, share records and information with the securities regulators of another State, Canada, a Canadian provinces or territory, a foreign jurisdiction; the Securities and Exchange Commission, the United States Department of Justice, the Commodity Futures Trading Commission, the Federal Trade Commission, the Securities Investor Protection Corporation, a self-regulatory organization, a national or international organization of securities regulators, a federal or state banking and insurance regulator, and a governmental law enforcement agency, to effectuate greater uniformity in securities matters among the federal government, self-regulatory organizations, States and foreign governments. (b) In cooperating, coordinating, consulting, and sharing records and information under this section and in acting by rule, order, or waiver under this chapter, the Administrator shall, in the discretion of the Administrator, take into consideration in carrying out the public interest the following general policies: (1) maximizing effectiveness of regulation for the protection of investors; (2) maximizing uniformity in federal and state regulatory standards; and (3) minimizing burdens on the business of capital formation, without adversely affecting essentials of investor protection. (c) The cooperation, coordination, consult[ing] and sharing of records and information authorized by this section includes: (1) establishing or employing one or more designees as a central depository for registration and notice filings under this chapter and for records required or allowed to be maintained under this chapter; (2) developing and maintaining uniform forms; (3) conducting a joint examination or investigation; (4) holding a joint administrative hearing; (5) instituting and prosecuting a joint civil or administrative proceeding; (6) sharing and exchanging personnel; (7) coordinating registrations under sections 621 and 631 through 634 and exemptions under section 613; (8) sharing and exchanging records; subject to section 667. (9) formulating rules, statements of policy, guidelines, forms, and interpretative opinions and releases; (10) formulating common systems and procedures; (11) notifying the public of proposed rules, forms, statements of policy, and guidelines; (12) attending conferences and other meetings among securities regulators, which may include representatives of governmental and private organizations involved in capital formation, deemed necessary or appropriate to promote or achieve uniformity; and (13) developing and maintaining a uniform exemption from registration for small issuers, and taking other steps to reduce the burden of raising investment capital by small businesses. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 121.

Final orders issued by the Administrator and rules adopted under this chapter are subject to judicial review by the Superior Court of the Virgin Islands. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 123.

(a) Sections 621, 622, 631(a), 632(a), 633(a), 634(a), 651, 656, 659 and 660 do not apply to a person that sells or offers to sell a security unless the offer to sell or the sale is made in this State, or the offer to purchase or the purchase is made and accepted in this State. (b) Sections 631(a), 632(a), 633(a), 634(a), 641, 646, 649, and 660 do not apply to a person that purchases or offers to purchase a security unless the offer to purchase or the purchase is made in this State, or the offer to sell or the sale is made and accepted in this State. (c) For the purpose of this section, an offer to sell or to purchase a security is made in this State, whether or not either party is then present in this State, if the offer: (1) originates from this State; or (2) is directed by the offeror to a place in this State and received at the place to which it is directed. (d) For the purpose of this section, an offer to purchase or to sell is accepted in this State, whether or not either party is then present in this State, if the acceptance: (1) is communicated to the offeror in this State and the offeree reasonably believes the offeror to be present in this State and the acceptance is received at the place in this State to which it is directed, and (2) has not previously been communicated to the offeror, orally or in a record, outside this State. (e) An offer to sell or to purchase is not made in this State when a publisher circulates or there is circulated on the publisher's behalf in this State a bona fide newspaper or other publication of general, regular, and paid circulation that is not published in this State, or that is published in this State but has had more than two-thirds of its circulation outside this State during the previous 12 months, or when a radio or television program or other electronic communication originating outside this State is received in this State. A radio, television program, or other electronic communication is considered as having originated in this State if either the broadcast studio or the originating source of transmission is located in this State, unless: (1) the program or communication is syndicated and distributed from outside this State for redistribution to the general public in this State; (2) the program or communication is supplied by a radio, television, or other electronic network with the electronic signal originating from outside this State for redistribution to the general public in this State; (3) the program or communication is an electronic communication that originates outside this State and is captured for redistribution to the general public in this State by a community antenna or cable, radio, cable television, or other electronic system; or (4) the program or communication consists of an electronic communication that originates in this State, but which is not intended for distribution to the general public in this State. (f) Sections 633(a), 634(a), 635(a), 652, 655, and 656 apply to a person if the person engages in an act, practice, or course of business instrumental in effecting prohibited or actionable conduct in this State, whether or not either party is then present in this State. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 123.

(a) A consent to service of process required by this chapter must be signed and filed in the form required by rule or order under this chapter. A consent appointing the Administrator the person's agent for service of process in a noncriminal action or proceeding against the person, or the person's successor, or personal representative under this chapter or a rule adopted or order issued by the Administrator under this chapter after the consent is filed, has the same force and validity as if the service were made personally on the person filing the consent. A person that has filed a consent complying with this subsection in connection with a previous application for registration or notice filing need not file an additional consent. (b) If a person, including a nonresident of this State, engages in an act, practice, or course of business prohibited or made actionable by this chapter or a rule adopted or order issued by the Administrator under this chapter and the person has not filed a consent to service of process under subsection (a), that act, practice, or course of business constitutes the appointment of the Administrator as the person's agent for service of process in a noncriminal action or proceeding against the person, the person's successor, or personal representative. (c) Service pursuant to subsection (a) or (b) may be made by providing a copy of the process to the office of the Administrator, but it is not effective unless: (1) the plaintiff, which may be the Administrator, promptly sends notice of the service and a copy of the process, return receipt requested, to the defendant or respondent at the address set forth in the consent to service of process or, if a consent to service of process has not been filed, at the last known address, or takes other reasonable steps to give notice; and (2) the plaintiff files an affidavit of compliance with this subsection in the action or proceeding on or before the return day of the process, if any, or within the time that the court, or the Administrator in a proceeding before the Administrator, allows. (d) Service as provided in subsection (c) may be used in a proceeding before the Administrator or by the Administrator in a civil action in which the Administrator is the moving party. (e) If the process is served under subsection (c), the court, or the Administrator in a proceeding before the Administrator, shall order continuances as are necessary or appropriate to afford the defendant or respondent reasonable opportunity to defend. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 124.

If any provision of this chapter or its application to any person or circumstances is held invalid, the invalidity does not affect other provisions or applications of this chapter that can be given effect without the invalid provision or application, and to this end the provisions of this chapter are severable. History: Added Aug. 12, 2004, No. 6678, § 1, Sess. L. 2004, p. 125.

In this subchapter: (1) "Beneficiary form" means a registration of a security which indicates the present owner of the security and the intention of the owner regarding the person who will become the owner of the security upon the death of the owner. (2) "Register" including its derivatives, means to issue a certificate showing the ownership of a certificated security or, in the case of an uncertified security, to initiate or transfer an account showing ownership of securities. (3) "Registering entity" means a person who originates or transfers a security title by registration, and includes a broker maintaining security accounts for customers and a transfer agent or other person acting for or as an issuer of securities. (4) "Security" means a share, participation, or other interest in property, in a business, or in an obligation of an enterprise or other issuer, and includes a certificated security, an uncertificated security, and a security account. (5) "Security account" means (i) a reinvestment account associated with a security; a securities account with a broker; a cash balance in a brokerage account; cash, interest, earning, or dividends earned or declared a security in an account; a reinvestment account; or a brokerage account, whether or not credited to the account before the owner's death; or (ii) cash balance or other property held for or due to the owner of a security as a replacement for or product of an account security whether or not credited to the account before the owner's death. (6) "TOD" means transfer on death. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 20, 21.

Only individuals whose registration of a security shows sole ownership by one individual or multiple ownership by two or more with right of survivorship, rather than as tenants in common, may obtain registration in beneficiary form. Multiple owners of a security registered in beneficiary form hold as joint tenants with right of survivorship, as tenants by the entireties, or as owners of community property held in survivorship form and not as tenants in common. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 21.

A security may be registered in beneficiary form if the form is authorized by this or a similar statute of the state of organization of the issuer or registering entity, the location of the registering entity's principal office, the office of its transfer agent or its office making the registration, or by this or a similar statute of the law of the state listed as the owner's address at the time of registration. A registration governed by the law of a jurisdiction in which this or similar legislation is not in force or was not in force when a registration in beneficiary form was made is nevertheless presumed to be valid and authorized as a matter of contract law. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 21.

A security, whether evidenced by certificate or account, is registered in beneficiary form when the registration includes a designation of a beneficiary to take the ownership at the death of the owner or the deaths of all multiple owners. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 22.

Registration in beneficiary form may be shown by the words "transfer on death" or the abbreviation "TOD" or by the words "pay on death" or the abbreviation "POD," after the name of the registered owner and before the name of a beneficiary. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 22.

The designation of a TOD beneficiary on a registration in beneficiary form has no effect on ownership until the owner's death. A registration of a security in beneficiary form may be canceled or changed at any time by the sole owner or all, then surviving owners without the consent of the beneficiary. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 22.

On death of a sole owner or the last to die of all multiple owners, ownership of securities registered in beneficiary form passes to the beneficiary or beneficiaries who survive all owners. On proof of death of all owners and compliance with any applicable requirements of the registering entity, a security registered in beneficiary form may be reregistered in the name of the beneficiary or beneficiaries who survive the death of all owners. Until division of the security after the death of all owners, multiple beneficiaries surviving the death of all owners hold their interests as tenants in common. If no beneficiary survives the death of all owners, the security belongs to the estate of the deceased sole owner or the estate of the last to die of all multiple owners. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 22.

(a) A registering entity is not required to offer or to accept a request for security registration in beneficiary form. If a registration in beneficiary form is offered by a registering entity, the owner requesting registration in beneficiary assents to the protections given to the registering entity by this subchapter. (b) By accepting a request for registration of a security in beneficiary form, the registering entity agrees that the registration will be implemented on death of the deceased owner as provided in this subchapter. (c) A registering entity is discharged from all claims to a security by the estate, creditors, heirs, or devisees of a deceased owner if it registers a transfer of the security in accordance with section 687 and does so in good faith reliance (i) on the registration, (ii) on this subchapter, (iii) on information provided to it by affidavit of the personal representative of the deceased owner, or (iv) by the surviving beneficiary or by the surviving beneficiary's representatives or other information available to the registering entity. The protections of this subchapter do not extend to a reregistration or payment made after a registering entity has received written notice from any claimant to any interest in the security objecting to implementation of a registration in beneficiary form. No other notice or other information available to the registering entity affects its right to protection under this subchapter. (d) The protection provided by this subchapter to the registering entity of a security does not affect the rights of beneficiaries in disputes between themselves and other claimants to ownership of the security transferred or its value or proceeds. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 22, 23.

A transfer on death resulting from a registration in beneficiary form is effective by reason of the contract regarding the registration between the owner and the registering entity and this subchapter and is not testamentary. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 23.

(a) A registering entity offering to accept registrations in beneficiary form may establish the terms and conditions under which it will receive requests (i) for registrations in beneficiary form, and (ii) for implementation of registrations in beneficiary form, including requests for cancellation of previously registered TOD beneficiary designations and requests for reregistration to effect a change of beneficiary. The terms and conditions so established may provide for proving death, avoiding or resolving any problems concerning fractional shares, designating primary and contingent beneficiaries, and substituting a named beneficiary's descendants to take in the place of the named beneficiary in the event of the beneficiary's death. Substitution may be indicated by appending to the name of the primary beneficiary the letters LDPS, standing for "lineal descendants per stirpes." This designation substitutes a deceased beneficiary's descendants who survive the owner for a beneficiary who fails to so survive, the descendants to be identified and to share in accordance with the law of the beneficiary's domicile at the owner's death governing inheritance by descendants of an intestate. Other forms of identifying beneficiaries, who are to take on one or more contingencies, and rules for providing proofs and assurances needed to satisfy reasonable concerns by registering entities regarding conditions and identities relevant to accurate implementation of registrations in beneficiary form, may be contained in a registering entity's terms and conditions. (b) The following are illustrations of registrations in beneficiary form which a registering entity may authorize: (1) Sole owner-sole beneficiary: John S. Brown TOD (or POD) John S. Brown, Jr. (2) Multiple owners-sole beneficiaries: John S. Brown, Mary B. Brown JT TEN TOD John S. Brown, Jr. (3) Multiple owners-primary and secondary (substituted) beneficiaries: John S. Brown, Mary B. Brown, JT TEN TOD John S. Brown, Jr., SUB BENE Peter Q. Brown or John S. Brown, Mary B. Brown, JT TEN TOD John S. Brown, Jr., LDPS. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 23, 24.

(a) This subchapter applies to registrations of securities in beneficiary form made before or after effective date of this subchapter, by decedents dying on or after effective date. (b) This subchapter must be liberally construed and applied to promote its underlying purposes and policy and to make uniform the laws with respect to the subject of this subchapter among the jurisdictions enacting it. (c) Unless displaced by the particular provisions of this subchapter, the principles of law and equity supplement its provisions. History: Added Jan. 1, 2016, No. 7851, § 1, Sess. L. 2016, p. 24.

This chapter may be cited as the "Uniform Prudent Investors Act." History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 148.

(a) Except as otherwise provided in subsection (b), a trustee who invests and manages trust assets owes a duty to the beneficiaries of the trust to comply with the prudent investor rule set forth in this chapter. (b) The prudent investor rule, a default rule, may be expanded, restricted, eliminated, or otherwise altered by the provisions of a trust. A trustee is not liable to a beneficiary to the extent that the trustee acted in reasonable reliance on the provisions of the trust. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 148.

(a) A trustee shall invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution. (b) A trustee's investment and management decisions respecting individual assets must be evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the trust. (c) Among circumstances that a trustee shall consider in investing and managing trust assets are such of the following as are relevant to the trust or its beneficiaries: (1) general economic conditions; (2) the possible effect of inflation or deflation; (3) the expected tax consequences of investment decisions or strategies; (4) the role that each investment or course of action plays within the overall trust portfolio, which may include financial assets, interests in closely held enterprises, tangible and intangible personal property, and real property; (5) the expected total return from income and the appreciation of capital; (6) other resources of the beneficiaries; (7) needs for liquidity, regularity of income, and preservation or appreciation of capital; and (8) an asset's special relationship or special value, if any, to the purposes of the trust or to one or more of the beneficiaries. (d) A trustee shall make a reasonable effort to verify facts relevant to the investment and management of trust assets. (e) A trustee may invest in any kind of property or type of investment consistent with the standards of this chapter. (f) A trustee who has special skills or expertise, or is named trustee in reliance upon the trustee's representation that the trustee has special skills or expertise, has a duty to use those special skills or expertise. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 148.

A trustee shall diversify the investments of the trust unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversifying. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 149.

Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee shall review the trust assets and make and implement decisions concerning the retention and disposition of assets, in order to bring the trust portfolio into compliance with the purposes, terms, distribution requirements, and other circumstances of the trust, and with the requirements of this chapter. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 149.

A trustee shall invest and manage the trust assets solely in the interest of the beneficiaries. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 149.

If a trust has two or more beneficiaries, the trustee shall act impartially in investing and managing the trust assets, taking into account any differing interests of the beneficiaries. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

In investing and managing trust assets, a trustee may only incur costs that are appropriate and reasonable in relation to the assets, the purposes of the trust, and the skills of the trustee. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

Compliance with the prudent investor rule is determined in light of the facts and circumstances existing at the time of a trustee's decision or action and not by hindsight. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

(a) A trustee may delegate investment and management functions that a prudent trustee of comparable skills could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill, and caution in: (1) selecting an agent; (2) establishing the scope and terms of the delegation, consistent with the purposes and terms of the trust; and (3) periodically reviewing the agent's actions in order to monitor the agent's performance and compliance with the terms of the delegation. (b) In performing a delegated function, an agent owes a duty to the trust to exercise reasonable care to comply with the terms of the delegation. (c) A trustee who complies with the requirements of subsection (a) is not liable to the beneficiaries or to the trust for the decisions or actions of the agent to whom the function was delegated. (d) By accepting the delegation of a trust function from the trustee of a trust that is subject to the law of the Virgin Islands, an agent submits to the jurisdiction of the courts of the Virgin Islands. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

The following terms or comparable language in the provisions of a trust, unless otherwise limited or modified, authorizes any investment or strategy permitted under this [Act]: "investments permissible by law for investment of trust funds," "legal investments," "authorized investments," "using the judgment and care under the circumstances then prevailing that persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital," "prudent man rule," "prudent trustee rule," "prudent person rule," and "prudent investor rule." History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

This chapter applies to trusts existing on and created after its effective date. As applied to trusts existing on its effective date, this chapter governs only decisions or actions occurring after that date. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 150.

This chapter shall be applied and construed to effectuate its general purpose to make uniform the law with respect to the subject of this chapter among the States enacting it. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 151.

If any provision of this chapter or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this chapter which can be given effect without the invalid provision or application, and to this end the provisions of this chapter are severable. History: Added Aug. 12, 2004, No. 6678, § 3, Sess. L. 2004, p. 151.

This chapter may be cited as "The International Financial Services Center Regulatory Act." History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(c), Sess. L. 2016, p. 387.

As used in this chapter: (a) "Affiliate" means a corporation partnership, limited liability company business trust, or any other legal organization or entity that controls, is controlled by, or is under common control with any other of these entities. (b) "Bank Secrecy Act (BSA)" means the federal Bank Secrecy Act of 1970, as amended by title III of the USA PATRIOT Act, codified in 31 U.S.C.5311 - 5330, as amended from time to time, to fight money laundering in the United States and require businesses to keep records and file reports that are determined to have a high degree of usefulness in criminal, tax and regulatory matters. (c) "Board" means the Virgin Islands Banking Board. (d) "Domestic Person" means any natural person who is a resident of the Virgin Islands or a person incorporated or organized under the laws of the Virgin Islands, or a person whose principal place of business is located in the Virgin Islands, and the Government or any political subdivision or agency of the Territory of the Virgin Islands. (e) "Foreign Person" means any person who is not a domestic person. (f) "International Financial Services Entity" means any person, other than an individual, incorporated or organized under the laws of the Virgin Islands, the United States, or a foreign country, or a unit of such person, to which a license has been issued pursuant to section 721. International financial services entities include international banking entities licensed before December 14, 2016. (g) "Insolvency" means the financial condition in which an international financial services entity may find itself or the person of which an international financial services entity is a unit, when it is unable to pay its debts when they become due or when its paid-in capital has been reduced to less than one-third (1/3). (h) "License" means permission granted by the Board of the Division of Banking, Insurance and Financial Regulation to operate an international financial services entity (IFSE) under the provisions of this chapter. (i) "Office of Foreign Assets Control (OFAC)" means the Office located within the United States Department of Treasury that administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotic traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States. (j) "Person" means an individual, corporation, partnership, association, unit, trust or estate, syndicate or enterprise of any kind, government or political subdivision or agency thereof. (k) "Regulations of the Board" means the regulations adopted by the Board, under section 717. (l) "Resident of the Virgin Islands" has the meaning that appears in title 26 U.S.C.932 and subsequent regulations enacted by the U.S. Department of the Treasury. (m) "The United States" means the United States of America, any state of the United States, the District of Columbia, and every possession, territory, political subdivision, and agency thereof, excluding the Virgin Islands. (n) "Unit" means a subdivision or branch of any person other than an individual, whose business and operations are segregated from the other business and operations of such person, as required by this chapter. (o) "Virgin Islands" means the territory of the United States as defined in section 2 of the Revised Organic Act and each of its political subdivisions and agencies. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7962, § 8(1), Sess. L. 2016, p. 311; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (d)(1)- (3), Sess. L. 2016, p. 387, 388.

(a) The Board shall: (1) adopt, and may thereafter, from time to time, repeal, amend, or supplement regulations in order to comply with the provisions of this chapter; (2) collect fees for examinations and audits, receive monies and make disbursements according to its budget or as otherwise provided by law or regulations; (3) open and maintain such bank accounts as may be necessary and appropriate to carry out the purposes of this chapter; (4) review and carry out investigations with regard to all applications for licenses to operate international financial services entities; (5) approve, grant conditional approval, or deny applications for permits and licenses to operate international financial services entities; provided, that any person whose applications has been denied or conditionally approved may request a hearing pursuant to the regulations; (6) supervise, inspect, and examine international financial services entities and require from them periodic reports and other information specified in the regulations of the Board; (7) require periodic examination of the accounts of each international banking entity as requested in the Board's discretion, which must include an examination of the financial condition of each international financial services entity, its compliance with the requirements of this chapter and the regulations of the Board, and such other matters as the Board may consider appropriate; (8) ascertain the financial security and operating soundness of international financial services entities and ensure that they comply with applicable laws and regulations and with any other provision or requirement that the Board may require by order or regulation; (9) revoke or suspend a license to operate an international financial services entity or impose any sanctions the Board may consider necessary and convenient pursuant to regulations, subject to the requirements of section 749; and (10) carry out such other activities incidental to the performance of duties under this chapter. (b) The Board may summon witnesses and request the production of such documents as the Board considers necessary to carry out any investigation under this chapter. The information obtained through this process must be kept confidential. (c) If a person fails to comply with a summons issued by the Board, the Board may seek whatever remedy that may be legally applicable, from the Superior Court of the Virgin Islands; and the court may order such person to comply with the summons of the Board, under admonition of contempt of court. (d) Within the term of 90 days after the closing of each fiscal year of the Virgin Islands, the Board shall remit to the Department of Finance, to be covered into the Tap Roots Program, described in section 754, five (5) percent of the net income obtained from his functions related to this chapter for such fiscal year. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (e), Sess. L. 2016, p. 387, 388.

(a) International Financial Services Entities may never bear interest at an interest rate of less than five percentage points above the Federal Home Loan Mortgage Corporation's posted yield on the last business day of the month on thirty-year standard conventional fixed-rate mortgages committed for delivery within sixty days, rounded to the nearest one-fourth percent, which rate shall-take effect (a) on the first day of the immediately subsequent month and continue in effect for the remainder of the month, and (b) apply to all commitments made by a beneficiary during such month. If for any reason, the Federal Home Loan Mortgage Corporation ceases its auction, temporarily or permanently, the index in the preceding sentence must be based on the Federal Home Loan Bank Board's average monthly contract rate. (b) The Board may not establish interest rates to be paid or charged by an international financial services entity. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) An international financial services entity may be: (1) any person, other than an individual, incorporated or organized under the laws of Virgin Islands, of the United States, or of any other country, or (2) constituted as a unit of another person, other than an individual, incorporated or organized under the laws of Virgin Islands, of the United States, or of any other country. (b) The articles of incorporation, the partnership agreement or any other written document establishing an international financial services entity must specify: (1) The name by which it is to be known. (2) The street, number and town where its principal place of business is to be established in the Virgin Islands. (3) (A) In the case of a corporation: (i) the amount of its authorized capital stock, which must not be less than $5,000,000 and of which at least $500,000 must be fully paid at the time the license is issued in accordance with section 721, but the Board may authorize a lesser authorized or paid-in capital, by request of the interested party, when the type of business or power that the international financial services entity intends to exercise or other circumstances thus merits it, in the criterion of the Board; (ii) the number of shares into which it is to be divided and the par value of each share. If the shares are to be issued in series, the date of issue of each series, as well as the manner and term in which payment thereof is to be made. (B) In the case of a person other than an individual or a corporation: (i) the amount of the proposed capital, which must not be less than $5,000,000 and of which at least $500,000 must have been fully paid at the time the license is issued in accordance section 721, but the Board may authorize a lesser proposed or paid-in capital, by request of the interested party, when the type of business or power that the international financial services entity intends to exercise or other circumstances merits it, in the criterion of the Board; and (ii) the name and address of its partners and other owners. (4) The term of its existence, which in the case of a corporation may be perpetual. (5) The purposes for which it is organized. (6) Any other provisions required by the regulations of the Board. (c) An international financial services entity that intends to operate as a unit shall provide certification executed by the person of which it is a unit in the form prescribed by the regulations of the Board, which must specify: (1) The name by which the unit is to be known. (2) The street, number, and town where its principal place of business in the Virgin Islands is to be established. (3) The amount of the authorized or proposed paid-in capital of the person of whom the international financial services entity is to be a unit, whose capital must not be less than $5,000,000, of which at least $500,000 must have been fully paid at the time the license is issued, but the Board may authorize a lesser authorized, proposed, or paid-in capital, by petition of the interested party, when the type of business or power that the international financial services entity intends to exercise or other circumstances thus merits it, in the criterion of the Board; (4) The purposes for which the unit is organized, including a specific limitation of its operations to carry out only those services authorized in section 726; and (5) Such other provisions as may be required by the regulations of the Board. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) Any person, as defined in section 719, may apply to the Board for a permit to organize an international financial services entity. The application must be in writing, in the form specified by the regulations of the Board and must be accompanied by: (1) The proposed articles of incorporation, partnership agreement or other written document establishing the international financial services entity or the certification required by section 719(c); (2) A nonrefundable application fee of $50,000, and; (3) Such other documents as may be specified by the regulations of the Board. (b) Every application must include, in the form required by the regulations of the Board: (1) The identity and business history of the applicants; (2) the city or town in the Virgin Islands and the street and number or any other address where its principal place of business in the Virgin Islands will be maintained; (3) the identity and business and credit history of any person who, directly or indirectly, possesses or controls or intends to possess or control 5 percent or more in the capital of the proposed international financial services entity; (4) a statement of the assets and liabilities of any applicant and of any person who possesses or controls or intends to possess or control 5 percent or more of the interest in the capital of the international financial services entity, or of the person of which the proposed international financial services entity is to be a unit, for each of the three years preceding the application; (5) the identity and background of all proposed directors, and officials or persons who intend to act in a similar capacity in the international financial services entity; (6) proof of the international financial services entity's registration with Financial Crimes Enforcement Network (FINCEN); and (7) such additional information as may be required by the regulations of the Board. (c) Upon receipt of the sworn application, all the required documents and the application fee, the Board shall carry out all the necessary investigations of the applicants and of the application, including a review of: (1) the financial solvency, credit, banking experience and business integrity of the applicants, their directors and officers, or persons who intend to act in a similar capacity in the proposed international financial services entity; (2) the adequacy of the capital available for the operations of the proposed international financial services entity; (3) the adequacy of the articles of incorporation, partnership agreement or other written document belonging to any applicant and, when appropriate, of the articles of incorporation, partnership agreement or other written document establishing the proposed international financial services entity; and (4) a Federal Bureau of Investigations fingerprint-based background check of any person who, directly or indirectly, possesses or controls or intends to possess or control 5 percent or more in the capital of the proposed international financial services entity. (d) In order not to create additional expenses on the Government of the Virgin Islands, the Board shall outsource the investigation to one or more Virgin Islands companies. The expenses incurred by the Board for the investigation required under this section must be paid by the applicants. The Board shall claim the investigation expenses from the applicants up to an amount of $25,000. All contracts awarded under this Act shall be secured utilizing the Virgin Islands Procurement Processes pursuant to title 31 of the Virgin Islands Code and must be awarded to Virgin Islands entities established to do business in the Territory for at least three years prior to this Act. Virgin Islands companies selected to conduct investigations must be vetted to ensure that its owners, officers and/or shareholders have no ties to any applicant or its legal representatives. (e) If the Board determines that the results of the investigation are favorable, and after payment of the investigation expenses as established in subsection (d) of this section, the Board shall issue to the applicants a permit to organize an international financial services entity, subject to such conditions as the Board may establish. If the Board declines to issue a permit to organize the international financial services entity, the applicant has 15 days to appeal the decision to the Lt. Governor who shall issue a decision within 30 days of the appeal. (f) When the Board issues a permit under this section, the interested party shall file with the Division of Corporations and Trademarks of the Lt. Governor's Office of the Virgin Islands, the articles of incorporation, partnership agreement or other written document establishing the proposed international financial services entity or unit, as well as the certification provided for in section 719(c) in the case of a unit and the permit issued by the Board. The Division of Corporations and Trademarks shall issue under its official seal, a certification of the filing of the stipulated documents. The Virgin Islands Division of Corporations and Trademarks shall post all the information regarding an International Financial Services Entity, to include the name of all owners, partners and shareholders, including their interest of ownership on the Lieutenant Governor's website. However the residential address of an IFSE owner or principal may not published or disclosed to the public. The information must be updated within thirty days of any filing, to include change of ownership or status. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (f)(1)-(5), Sess. L. 2016, p. 387, 388.

(a) A person may not commence operations as an international financial services entity before it has been issued a license under this section. (b) The Board may issue to the applicants a license to operate an international financial services entity after receipt of: (1) the certification by the Division of Corporations and Trademarks referred to in section 720 of this title; (2) an initial fee of $75,000 and the payment of $75,000 as an annual fee for the license to operate an international financial services entity. An additional annual fee of $10,000 shall be paid by the IFSE once the IFSE has exceeded $1,000,000 in annual net income; (3) a certified copy of the articles of incorporation, partnership agreement or other written document establishing the international financial services entity or the certification of the person of which the international financial services entity is a unit; (4) a copy of the bylaws or internal governing agreements adopted by the board of directors or similar governing body of the international financial services entity, which must be certified before a notary public by its secretary or an individual acting in a similar capacity; (5) evidence in the form required by the regulations of the Board, that the capital of the international financial services entity has been subscribed to, issued and paid-in, to the extent and under such conditions as the Board may establish at the Board's discretion; (6) a statement in the form required by the regulations of the Board and authenticated before a notary public, by the Secretary of the Board of Directors or the person acting in a similar capacity for the international financial services entity, or for the person of which the international financial services entity is a unit, to the effect that the international financial services entity has complied with the requirements of this chapter and of the regulations of the Board and that it is ready to commence operations. (c) The license must be renewed and the license fee established under this section must be paid annually no later than 15 days following each anniversary date of the issuance of the original license; (d) Subject to section 749, the Board may not issue a license if the Board believes, or has reason to believe, that the applicant has violated the provisions of this chapter or the regulations of the Board. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (g)(1), (2), Sess. L. 2016, p. 387, 388.

(a) The articles of incorporation, partnership agreement or other written document establishing an international financial services entity or to any license executed in accordance with section 721, may not be amended, unless the amendment has been previously approved, in writing, by the Board. (b) After the adoption of any amendment to the articles of incorporation, partnership agreement or other written document establishing an international financial services entity or to any certification executed in accordance with section 719 of this title, the amended document must be filed with the Division of Corporations and Trademarks. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) Every international financial services entity shall possess not less than $300,000 of unencumbered assets or acceptable financial securities, or that lesser sum that, by request of the interested party, the Board authorizes, when the type of business or power that the international financial services entity intends to exercise or other circumstances thus merits it, in the judgment of the Board. The unencumbered assets must be physically located in the Virgin Islands and subject to the requirements regarding them established by the regulations of the Board. (b) Subject to paragraph (3), without the prior written approval of the Board, an international financial services entity may not issue: (1) additional shares of capital stock or other securities convertible into additional shares of capital stock, in the case of a corporation; or (2) additional capital or other securities convertible into additional capital, in the case of a person other than a corporation. (3) In the case of a corporation, an international financial services entity may issue additional shares of capital stock or other securities convertible into shares of capital stock, and in the case of a person other than a corporation, issue additional capital or other securities convertible into additional capital, without the prior written approval of the Board when such additional shares or capital are issued directly to the shareholders of the international financial services entity previously identified pursuant to section 720(b)(3). In such event, the international financial services entity shall notify the Board of all the particulars of such issuance no later than 10 business days following the date of the issue. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

Entity (a) Except as provided in regulations of the Board, a sale, encumbrance, assignment, merger, barter, exchange or other transfer of shares, interest or participation in the capital of an international financial services entity may not be initiated without the previous written authorization of the Board, if by way of such transaction, a person could acquire, directly or indirectly, control of 10 percent or more of any class of stock, interest or participation in the capital of an international financial services entity. (b) Every sale, encumbrance, assignment, merger, barter, exchange or other transfer of shares of capital stock, interest or participation in the capital of an international financial services entity, as set forth in subsection (a) of this section, is void "ab initio" if the written authorization of the Board has not been obtained. The written authorization of the Board may not be unreasonably withheld. (c) The international financial services entity shall notify the Board, 30 days in advance of the transfers referred to in subsection (a), the identity of the transferor and of the transferee and the nature of the transaction. The Board may require such additional information as he considers necessary to determine if the transfer would be detrimental to the security or financial solvency of the international financial services entity or if it would violate any law, rule or regulation governing the international financial services entity, in which case the Board may deny the authorization for such transaction; but any person to whom such authorization is denied shall have the right to request a hearing pursuant to the regulations provided in section 749. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

A license issued under this chapter may not be sold, assigned, transferred, pledged, used as security, or otherwise encumbered, except under the provisions of section 748. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230.

(a) Upon receipt of a license to operate an international financial services entity under section 721, an international financial services entity may: (1) accept transaction-related funds from foreign persons in accounts as well as demand or fixed term deposits and interbank deposit of funds. For purposes of this chapter, "transaction-related funds" means moneys, funds, credits, securities or properties accepted by an international financial services entity in connection with a loan or other transaction, good or service provided by the international financial services entity under this chapter; (2) accept or provide wholesale or retail repurchase agreements, or otherwise borrow money from international financial services entities and from any foreign persons, subject to any regulations adopted by the Board. (3) make, procure, place, arrange, guarantee, secure, bond, or service, loans or other financial undertakings including factoring; provided, that none of such loans or financial undertakings may be granted to a domestic person, except as provided in paragraph (3) of this subsection, and in the case of financial securities for debt, issue transactions in the Virgin Islands; (4) (A) issue, confirm, give notice, negoparagraph (3)nance letters of credit; if the client and the beneficiary requesting the letter of credit is not a domestic person, or (B) issue, confirm, give notice, negotiate, or refinance letters of credit in transactions for the financing of exports, even if the beneficiary is a domestic person. (5) engage in money services, money transmission, payment services, bill-payment services, payment systems, check cashing, sale of instruments or other payment devices, currency exchange, or other financial and business management services, including, without limitation, providing, discounting, rediscounting, dealing or otherwise trading in money orders, stored value, bills of exchange, drafts, or other instruments or payment devices, provided that the purchaser, payee, or beneficiary is not a domestic person. (6) Invest securities of the Government of the Virgin Islands, its public agencies and instrumentalities, its municipalities, and its political subdivisions, or in other local securities, if there exist any, exempted from the payment of taxes in the Virgin Islands; make commercial loans in excess of $1,000,000 made to Virgin Islands borrowers or borrowers in the Virgin Islands that (i) have been rejected by, or not approved within 30 days from the date a written loan application has been made to, any licensed Virgin Islands financial institution; or (ii) bear interest at an interest rate of not less than five percentage points above the Federal Home Loan Mortgage Corporation's posted yield on the last business day of the month on thirty- year standard conventional fixed-rate mortgages committed for delivery within sixty days, rounded to the nearest one-fourth percent, which rate must take effect on the first day of the immediately subsequent month and continue in effect for the remainder of the month, and apply to all commitments made by a beneficiary during such month; make capital contributions in excess of $1,000,000 made to Virgin Islands business entities or business entities in the Virgin Islands; (7) carry out any banking transactions permitted by this chapter in the currency of any country, or in gold or silver, and participate in foreign currency trade. (8) underwrite, issue, distribute, and otherwise deal in securities, notes, debt instruments, drafts, bills of exchange, issued by the international financial services entity, or by a foreign person, for final purchase by a person outside of the Virgin Islands; (9) engage in insurance brokerage for risks or objects that reside, are located or that will be executed outside of the Virgin Islands, subject to regulations established by the Board. (10) underwrite insurance for risks or objects that reside, are located or that will be executed outside of the Virgin Islands, subject to regulations established by the Board. (11) engage in trade financing of import, export, barter and exchange of raw materials and finished products activities with domestic persons, when the Board has determined through regulations or order, that the international aspects of the underlying transaction override any involvement of the local financial and business community, and that such activities would be appropriate for the international financial services entity; (12) engage in advertising, selling, provision or performance, directly or indirectly, by any consumer reporting agency as defined in 15 U.S.C. §1681a(f) of the Fair Credit Reporting Act, 15 U.S.C. §§1681 et seq., or any affiliate 15 U.S.C. §15 of such a consumeFair Credit Reporting Acty 15 U.S.C. §§15service relating to: (1) consumer credit, including, without limitation, maintaining information related to the credit history of consumers, providing to consumers credit reports, credit scores, credit monitoring, credit education, credit enhancement, consumer education and advice for any purpose, including, without limitation, to improve a consumer's credit records, credit history or credit rating; (2) identity theft and fraud protection; and (3) the promotion, offering and provision of consumer credit or other financial products and services, including, in connection with an application for credit by consumers. (13) engage in any activity of a financial nature for clients outside of the Virgin Islands which would be allowed to be done, directly or indirectly, by a bank holding company or by a foreign office or subsidiary of a United States bank under applicable United States law. (14) after obtaining a special permit from the Board, act as fiduciary, executor, administrator, registrar of stocks and bonds, property custodian, assignee, trustee, agent or in any other fiduciary capacity; but, such fiduciary services may not be offered to, nor inure to the benefit of domestic persons; (15) acquire and lease personal property to a person who is a foreign person, including any transactions, at the request of a lessee or seller/lessee who is a foreign person, pursuant to a financial lease agreement, rent-to-own, or sale/leaseback agreement, subject to any regulations adopted by the Board. (16) buy and sell securities and non-life insurance annuities for clients outside the Virgin Islands, and provide investment advice in relation to such transactions or separate therefrom, to such persons, and in addition offer these services and products to the Government of the Virgin Islands and any of its instrumentalities, agencies, and investment vehicles. (17) act as a clearinghouse in relation to financial contracts or instruments of foreign persons, subject to any regulations adopted by the Board. (18) organize, manage and provide management services to international financial entities, such as investment companies and mutual funds, on the condition that the stock or participation in the capital of such companies is not distributed directly by the international financial services entity to domestic persons. (19) engage in such other activities as are expressly authorized by the regulations or order of the Board, or are incidental to the execution of the services authorized by this chapter and the regulations of the Board; (20) participate in the granting and securing of loans that originate or are secured by the Economic Development Authority of the Virgin Islands or for the University of the Virgin Islands Research and Technology Park. (21) (A) establish, with the Board's authorization, branches outside of Virgin Islands, in the United States mainland and its possessions, or in other foreign countries. The Board may provide, through regulations, the procedure to obtain the authorization, and the amount payable for application investigation expenses and annual quota fees for each one of the branches. (B) The International Financial Services Entities are authorized to establish a service unit or office in the Virgin Islands, in which only specific operations related to the services of the international financial services entity are conducted, in the manner and form provided through regulations, but by no means may the service unit or office constitute a branch. (22) With the prior authorization of the Board, provide to other international financial services entities or to foreign persons or entities outside of the Virgin Islands, those services of financial nature, as these are defined and generally accepted in the banking industry of the United States and the Virgin Islands and which are not listed in this section. This paragraph does not apply to activities otherwise authorized by this chapter. (23) The Virgin Islands international financial services entities may conduct their permitted activities on the Internet. If the international financial services entities use a computer server located in the Virgin Islands, the transaction is considered to occur in the Virgin Islands and venue for any disputes must be in the local and federal courts of the Virgin Islands. (b) The international financial services entity may not: (1) accept funds or borrow money from domestic persons, except from the Economic Development Bank of the Virgin Islands, and from other international financial services entities. (2) make, procure, arrange, place, guarantee, secure, bond, or service, loans or other financial undertakings, unless all loan proceeds are to be used outside of the Virgin Islands, with the exception of the cases permitted in paragraphs (20) and (21) of subsection (a) or subsection (e). (3) issue, confirm, or give notice of letters of credit, unless all proceeds of the letter of credit are to be used outside of the Virgin Islands, and that both the issuer and the beneficiary are foreign persons, with the exception of export financing transactions in which the beneficiary is a domestic person. (4) discount bills of exchange, unless all the proceeds of the bills of exchange would be used outside of the Virgin Islands and that both, the drawer and the beneficiary, are foreign persons. (5) purchase or hold any of its own capital stock, or the capital stock of or the interest in the capital of the person of which it is a unit, except when previously authorized by the Board. (6) grant any kind of financing or credit to any of its directors, officers, employees or stockholders, except when previously authorized in writing by the Board. (7) directly or indirectly place, underwrite, insure or reinsure risks or objects that reside, are located or will be executed in the Virgin Islands, or participate in reciprocity or retrocession arrangements or agreements covering or relating to such risks or objects, or assign insurance to, or assume reinsurance from any insurer authorized to do or who is doing insurance business in Virgin Islands. (c) An international financial services entity that is a unit of another person shall segregate and keep separated all transactions made or conducted by the unit, from every other transaction made or conducted by the person of which the international financial services entity is a unit. (d) Each activity authorized by this section includes transactions whether for commercial, business, investment or agricultural purposes, or for personal, family or household purposes. (e) In connection with the making, procuring, placing, arranging, guaranteeing, securing, bonding, or servicing, of any loan or other financial undertaking by an international financial services entity, the international financial services entity may require and accept as security any type of property, whether provided by the borrower or a third person, including, without limitation, any real property or personal property purchased with the proceeds of the loan or other financial undertaking by the international financial services entity, and without requiring any adjustment to the principal balance of the loan or other financial undertaking for interest or other purposes. However, in connection with any loan or financial undertaking in which security for the loan or financial undertaking is purchased or acquired with proceeds of the transaction, the borrower or third person shall provide a written certification that it considers the use of proceeds for purposes of security for the loan or financial undertaking to be beneficial to the borrower or third person. (f) The international financial services entity shall disclose in advance if a certain type of account or service is not insured by providing a notice in language substantially similar to the following: "THIS [SPECIFY TYPE DEPOSIT ACCOUNT OR SERVICE] IS NOT INSURED". (g) In connection with the activities of an international financial services entity under this chapter, the Board may establish reasonable regulations and reporting requirements with respect to an international financial services entity's compliance with any applicable federal anti-money laws of the United States, including, without limitation, the following: the Bank Secrecy Act (31 U.S.C. §5311 et seq.), and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56,115 Stat. 272. In order to limit additional costs to the Virgin Islands Government, the Board shall outsource anti money laundering due diligence compliance programs to Virgin Islands companies, and the international financial services entity is responsible for paying any reasonable costs, as determined by the Board, associated with such compliance. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (h), Sess. L. 2016, p. 387.

(a) The international financial services entity shall employ on a full-time basis a minimum of three persons at its business office or offices in Virgin Islands. However, the Board may authorize a lesser number of employees upon request of the interested party. In considering such authorization the Board shall evaluate factors, such as the powers conferred by the license granted under this chapter, the nature and complexity of its operations in Virgin Islands, and those other criteria established in the regulations of the Board. (b) The full-time employees of a person of which an international financial services entity is a unit which render some services to such entity, are considered to be full-time employees of such entity for purposes of the employment requirements set forth in subsection (a). (c) An international financial services entity may engage other persons to act as its agent in the exercise of the international financial services entity's authorized activities in this chapter whether on or off its premises, and, in connection therewith: (1) Such performance must be treated, and subject to regulation and examination by the Board, to the same extent as if the services were being performed by the international financial services entity itself on its own premises, and (2) The international financial services entity shall notify the Board of the existence of the service relationship no later than 60 days after the making of the service contract or the performance of the service, whichever occurs first. The Board may establish exemptions from the reporting requirement in this paragraph. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) The original of the account books and registers of the international financial services entity must be kept in its main business office in the Virgin Islands and must reflect such details and be kept in such a manner as may be required by the regulations of the Board; a duplicate of the account books and registers may be kept and maintained in entity's country of origin. (b) The account books and registers must be segregated and kept separately from the account books and registers of any other person. (c) The originals of the account books and registers of an international financial services entity are considered as belonging to the international financial services entity regardless of whether the entity is a person or constitutes a unit of another person. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

Every international financial services entity shall submit to the Board all reports as may be required by the regulations of the Board, including an annual financial statement prepared by certified public accountants, licensed to practice in the Virgin Islands, as well as interim financial statements. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) The license issued under section 721 is subject to revocation or suspension by the Board, upon previous notice and hearing pursuant to the regulations under this chapter, if: (1) An international financial services entity or the person of which the international financial services entity is a unit, contravenes or fails to comply with any of the provisions of this chapter, any regulation of the Board, or any of the terms or conditions of the license to operate an international financial services entity. (2) An international financial services entity fails to pay the annual license fee of $75,000. (3) The Board finds that the business or affairs of an international financial services entity are conducted in a manner that is not consistent with the public interest. (b) In all hearings commenced under this chapter, the International Financial Services Entity has the burden of proof, and the standard of proof is by clear and convincing evidence. The Board may not undertake any arbitrary or discriminatory enforcement action. (c) An international financial services entity or the person of which the international financial services entity is a unit, may at any time, and in the manner provided by the regulations of the Board, surrender its license to operate an international financial services entity. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), (i), Sess. L. 2016, p. 387, 389.

The Board may deny the issuance of a license or revoke a license for any one of the following reasons: (1) providing incorrect, misleading, incomplete or materially untrue information in the license application; (2) violating or failing to comply with any financial services or other applicable law, rule, subpoena, consent agreement, or order of the Board; (3) obtaining, maintaining, or attempting to obtain a license through material misrepresentation or fraud; (4) improperly withholding, misappropriating or converting any money or properties received in a fiduciary capacity; (5) intentionally misrepresenting the terms, benefits, value, cost, or effective dates of any financial services permitted transaction; (6) having been convicted of or pleaded guilty or no contest to a felony regardless of whether a judgment of conviction has been entered by the court; (7) having been convicted of or pleaded guilty or no contest to a misdemeanor that involves the misuse or theft of money or property belonging to another, fraud, forgery, dishonest acts, or breach of a fiduciary duty that is based on any act or omission relating to a financial services permitted transaction, or that involves moral turpitude regardless of whether a judgment has been entered by the court; (8) having admitted or been found to have committed any unfair trade act or practice or financial services fraud; (9) using fraudulent, coercive, or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this Territory or elsewhere; (10) having a financial services-permitted transaction license, or equivalent, denied, suspended or revoked in any other country, state, province, district or territory; (11) having been fined or issued an order by another country, state, province, district or territory regulatory authority for a violation of the Currency and Foreign Transactions Act of 1970, the Money Laundering Control Act (1986), the Anti-Drug Abuse Act of 1988, the Annunzio-Wylie Anti-Money Laundering Act (1992), the Money Laundering Suppression Act (1994) or the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001; (12) forging or causing the forgery of another's name to a license application or to any document related to a permitted transaction; (13) failing to pay income taxes in accordance with Virgin Islands and Federal laws or to comply with any administrative or court order directing payment of income or corporate taxes in accordance with Virgin Islands and Federal laws; (14) failing to respond to an order or request of the Board within 15 days after the request; (15) proving to be untrustworthy, or a source of injury and loss to the public or if the Board considers the licensee to be so; (16) performing or attempting to perform permitted transactions allowed under this chapter, but that are outside the scope of the license; (17) performing or attempting to perform transactions prohibited under this chapter; (18) engaging in any activity for which issuance of the license could have been refused had it then existed and been known to the Board; or (19) engaging in any other action as determined by the Board pursuant to the laws and regulations of the Territory that warrants the denial or revocation of a license. History: Added Jan. 20, 2017, No. 7968, § 2(a), Sess. L. 2016, p. 389, 390.

(a) The Board may appoint a receiver and order the dissolution of an international financial services entity if the license of the international financial services entity or of the person of which the international financial services entity is a unit, is revoked or surrendered under section 730. (b) The receiver appointed must be a person of recognized moral qualities, with vast experience in the field of banking or finance, and the receiver's performance with the international financial services entity must be secured by an adequate bond, to be paid by the international financial services entity itself. (c) The receiver shall manage the international financial services entity in accordance with the provisions of this chapter and shall: (1) take possession of the assets and liabilities, books, records, documents and files which belong to the international financial services entity; (2) collect all loans, charges and fees owed to the international financial services entity; (3) pay all obligations and debts of the international financial services entity, after having paid the necessary costs of the receivership; and (4) supervise the dissolution and liquidation of the international financial services entity. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) If any director, official or individual acting in a similar capacity of an international financial services entity or of a person of which the international financial services entity is a unit, violates, or voluntarily or negligently permits any director officer, agent, or employee of the international financial services entity or of the person of which the international financial services entity is a unit, to violate this chapter, the regulations of the Board, or any provision of the certificate of incorporation, partnership agreement or other written document establishing the international financial services entity, the Board shall schedule and summon the interested parties to an administrative hearing pursuant to the regulations provided in section 730 of this title. Once the hearing is held and after the Board determines that a provision mentioned in this subsection has been violated, the Board shall take the corresponding action, including the suspension or dismissal of such director, officer or individual. (b) Any official or employee of an international financial services entity, or of a person of which it is a unit, who on behalf of such international financial services entity receives any funds or contract for a loan with the knowledge that the international financial services entity or the person of which it is a unit is insolvent, is subject to a civil penalty of not less than $5,000 nor more than $10,000 and is also liable to make restitution for any losses suffered by any victim. (c) Any director, official or employee of the international financial services entity or of the person of which the international financial services entity is a unit, who illegally appropriates, embezzles, removes or voluntarily misuses any moneys, funds, credits, securities, or other properties of an international financial services entity, or who, without due authorization, issues or draws any certificate of account, draws any order or bill of exchange, carries out any type of acceptance or assignment of a note, bond, money order, bill of exchange, and any person who, with the same intention, aids or abets any director, official or employee to violate any provision of this section, is subject to a civil penalty of not less than $5,000 nor more than $10,000 and is also liable to make restitution for any losses suffered by any victim. (d) Any director, official, or employee of an international financial services entity or of the person of which the international financial services entity is a unit, who voluntarily misrepresents the financial condition of an international financial services entity or about any transaction to be carried out by, or carried out by the international financial services entity, or who declines to provide information legally requested by the Board, is subject to a civil penalty of not less than $5,000 nor more than $10,000. (e) This section may not be construed in any manner to limit the power of the Board to impose administrative fines for violations of this chapter or the regulations of the Board. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 2(b)(1), (2), Sess. L. 2016, p. 387, 391.

(a) The information that the international financial services entity provides to the Board pursuant to this chapter and the regulations of the Board must be kept confidential, except: (1) when disclosure of such information is required by law or judicial order; or (2) through a formal petition of a domestic or foreign government agency in the course of the exercise of its supervisory function. In such case, the information must be delivered under a binding agreement with the concerned government entity to maintain the confidential nature of the information. However, the exception under this paragraph may under no circumstances be extended to information regarding clients of the international financial services entity unless the client is under investigation or has been convicted in another jurisdiction. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 2(c), Sess. L. 2016, p. 387, 391.

Review All matters related to administrative hearings procedure, adjudicatory proceedings and judicial review must be set forth by regulations promulgated by the Board. The regulations must substantially conform to the principles of the federal Administrative Procedure Act, 5 U.S.C. Sec.551 et seq. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

Neither the provisions of this title, nor chapter 15 of title 11, which fix the maximum interest rates or charges permitted on loans, are applicable to the operations of international financial services entities established under this chapter. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), 2(d), Sess. L. 2016, p. 387, 391.

(a) There is established in the Treasury of the Government of the Virgin Islands a fund designated as the International Financial Services Center Revolving Fund. The Commissioner of Finance shall administer the Fund as a separate and distinct fund in the Treasury of the Government of the Virgin Islands. (b) The Fund consists of an annual appropriations of not less than $75,000 to be used exclusively for the administrative costs and the salary of a qualified financial services examiner whose primary responsibility is to ensure that persons issued a license under this chapter comply with this chapter. The Commissioner of Finance shall disburse monies from the Fund to the Board to pay the salary of the examiner. History: Added Jan. 20, 2017, No. 7968, § 3, Sess. L. 2016, p. 391.

(a) Any international business entity licensed and regulated under this chapter before the effective date of subchapter III, is eligible to receive any tax exemption, tax credit, or tax privilege pursuant to this subchapter. (b) The Board may: (1) review all applications for tax incentive benefits, issue a Certificate of Eligibility for Tax Incentive Benefits to: international financial services entities licensed and regulated under this chapter; (2) determine compliance of the beneficiary with the provisions of this chapter and the regulations issued under this chapter. The expenses of any investigation by the Board to determine compliance by any beneficiary must be borne by the beneficiary; (3) modify, suspend or revoke a certificate of tax incentive benefits, and hold a hearing in which the beneficiary must show cause why its certificate of tax incentive benefits should not be modified, suspended or revoked; (4) in connection with any investigation or hearing required by this chapter or regulations issued pursuant to this chapter, subpoena witnesses, records, books, and administer oaths, and inspect properties and facilities of tax incentive beneficiaries and applicants for tax incentive benefits. (5) request and obtain from the Commissioner of Finance and Board of the Internal Revenue Bureau such auditing services as considered necessary to the proper administration of this chapter, or the Board may outsource the auditing service necessary to this function. Reasonable costs of such outsourcing, as determined by the Board, shall be borne by the international financial services entity. (6) prepare and promulgate, in accordance with title 3, chapter 35 of the Virgin Islands Code, such regtitle 3s chapter 35 of the Virgin Islands Codeprovisions of this chapter; (7) prepare and submit annual reports to the Governor and the Legislature containing data regarding all tax incentive benefits outstanding and the beneficiaries of such tax incentives; (8) in addition to the application fee and annual compliance fees, assess against an applicant or beneficiary any extraordinary costs and expenses to process the application or monitor the beneficiary's performance of the conditions in the certificate, including costs for the services of outside consultants necessitated by the application or compliance investigation; (9) notify the office of the Lieutenant Governor of any corporation, joint venture, limited liability company, partnership of any other entity which have been approved for tax incentive benefits within 60 days of such approval; as well as prepare and submit an annual listing of all entities that are approved for tax incentive benefits whether they are currently operational or not; (10) conduct investigations with respect to all applications for tax incentive benefits; (11) promote the tax incentive program; prepare an annual budget for consideration and approval by the Lieutenant Governor; (12) perform such other acts or functions within the area of responsibility as it may be necessary in furtherance of the purposes of this chapter. (c) Notwithstanding any provision of this chapter, law or regulation, any business organized and licensed pursuant to this chapter and which receives any benefit under this chapter, shall make a yearly contribution of not less than $10,000 to the Virgin Islands Board of Education to be used exclusively as funding for territorial scholarships. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 4(a), Sess. L. 2016, p. 387, 391.

Each certificate granting tax incentive benefits issued under this subchapter is a contract between the Government of the Virgin Islands and the beneficiary. Should the Government adopt any legislation impairing or limiting the obligations going forward, existing contracts must be honored. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 4(b), Sess. L. 2016, p. 391.

(a) The Board may not require an applicant to meet qualifications or requirements in excess of the conditions listed in this subchapter for the granting of an initial certificate. (b) In order to qualify and remain eligible for tax incentive benefits under this chapter, an applicant must fulfill the following qualifications or requirements: (1) Invest at least $50,000, exclusive of inventory, in the business related to banking; (2) Be the actual investor in the enterprise for which tax incentive benefits are sought, and not a contractor, subcontractor, or other person or corporation acting as an agent or a similar capacity to the investor, provided that corporate affiliates who are actual investors may qualify for benefits; (3) Employ at least five full time persons; (4) Comply with all federal and local laws; (5) Agree in writing to employ or contract with Virgin Islands businesses and Virgin Islands residents; (6) Meet any time restraints or deadlines imposed by the Board with respect to the initiation of operations or activity, provided that the Board may extend any such time restraints or deadlines upon good cause shown by the beneficiary; (7) Agree in writing to notify the Virgin Islands Department of Labor as to the availability of employment by it or its subcontractors, the number of employees required, the occupational classification of such workers, and the applicable wage rate; (8) Provide educational assistance to residents of the Virgin Islands which is acceptable to the Board or provide a financial contribution to an educational fund established by the Board or by the Virgin Islands Legislature. As used in this subsection, educational assistance includes all types of educational assistance including vocational and other job training programs, including Taproots, Inc.; (9) Agree in writing to submit plans for a management-training program for approval by the Board. Provide its employees additional leave from work, other than time applied to their annual leave, to participate and represent the Virgin Islands in athletic and sporting events; and (10) Agree in writing and require all contractors retained by it to purchase all insurance from resident insurance companies, agents, or brokers licensed to operate in the Virgin Islands, and if a particular type of insurance is not available in the Virgin Islands, submit to the Board written certification from the Office of Banking and Insurance that the insurance is unavailable. (c) The Board shall establish, by regulation, the requirements for management training programs required by this section, as guidance for all beneficiaries and the reasonable number of Virgin Islands residents to be employed by each beneficiary in accordance with the specific normal requirements of the business involved, and report annually to the Governor the titles and compensation of all trainees who are placed in management positions by beneficiaries. (d) The Board may impose a monetary penalty for delinquent reports as prescribed by law. Any monetary penalty imposed by the Board pursuant to this section must be deposited into the Territorial Scholarship Fund established pursuant to title 17, section 171, of the Virgin Islands Code. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 4(c), Sess. L. 2016, p. 387, 391; amended May 19, 2020, No. 8307, § 1, Sess. L. 2020, p. 52.

If after notice and hearing the Commissioner of Labor finds that the beneficiary or any contractor or any other agent of the beneficiary has willfully practiced discrimination in employment based on age, sex, race, national origin or religion, the Commissioner shall certify the finding to the Board, who shall revoke the beneficiary's certificate upon clear and convincing evidence at a hearing in compliance with local and federal due process requirements. The beneficiary has a right to seek immediate judicial review to the Virgin Islands Superior Court of any adverse decision. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

Entity; Temporary Permits (a) After the third year of operation, an international financial services entity shall have at least 60% of its management, supervisory or technical positions filled by residents of the Virgin Islands as defined in title 29, section 703 of the Virgin Islands Code, unless granted a waiver by the Board. (b) A waiver may be granted only when: (1) The Commissioner of Labor has certified that: (A) The beneficiary has not been able to recruit individuals to fill the positions; or (B) The beneficiary has not been able to train individuals to fill the positions; or (C) The beneficiary has demonstrated to the Commissioner of Labor that the beneficiary's training program has failed to provide the individuals capable of filling the positions and that the beneficiary has made a public effort to recruit personnel for the positions; or (2) The Board has made a finding that the economic position of the beneficiary is such that the beneficiary cannot comply with the requirement without further erosion of its financial position or that the beneficiary cannot comply for such other practical reasons that the Board has established by regulations. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) The Commissioner of Labor shall appoint a qualified and responsible employee of the Department of Labor to administer, supervise and enforce or cause to be enforced the provisions of this section and section 740, and in this context may promulgate necessary regulations, conduct such investigations and institute such remedial action as may be required. Should remedial action be found to be required, the beneficiary would be required to pay for reasonable costs, as determined by the Board, of investigation. (b) Any beneficiary applying for permission to hire nonresidents in accordance with subsection (d)(2) shall submit a specification of the number of nonresident workers required and their occupational classifications and wage rates to the Commissioner of Labor for review prior to any grant of permission to hire a nonresident. Upon receiving the information and material, the Commissioner shall: (1) promptly supply the information and material to all labor unions operating in the Virgin Islands; (2) at the expense of the beneficiary, give public notice of such employment opportunity; and (3) assist the beneficiary in the recruitment of residents. (c) The Commissioner of Labor shall provide an evaluation of those residents available in the labor market with the necessary skills suitable for employment by the beneficiary. All beneficiaries employing nonresidents shall annually prepare and file with the Commissioner of Labor a complete roster of all nonresidents and a detailed description of the positions held by such nonresidents. The Commissioner of Labor shall promulgate specific regulations governing compliance with these requirements. (d) A beneficiary may not employ a person who is not a resident of the Virgin Islands unless: (1) After hiring the nonresident, at least 80 percent of the beneficiary's employees are residents of the Virgin Islands; or (2) The Department of Labor has certified that: (A) The beneficiary requested the Department of Labor's assistance in filling the vacancy; and (B) The Department of Labor was unable, within thirty working days after the beneficiary's request, to refer any qualified applicants to the beneficiary for employment. (e) The Commissioner of Labor shall report all violations of the resident employment provisions of this chapter to the Board. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

(a) Each international financial services entity applicant granted a tax incentive benefit certificate, pursuant to this chapter is exempt from payment of the following taxes: (1) taxes on real property to the extent that properly is used in the business; (2) gross receipt taxes, except that this exemption does not apply to the gross receipts of businesses operated by a concession or rental agreement on the premises of beneficiaries, for which businesses separate licenses are required or which, as determined by the Board, are not ordinarily related to, or do not constitute an essential part of, the operation of the beneficiary, and which businesses are not otherwise eligible for tax incentive benefits as a distinct enterprise; (3) all excise taxes on building materials, tools, pipes, pumps, conveyor belts or other appliances materials and supplies necessary for the use in the construction, alteration, reconstruction or extension of the physical plant or facilities of the applicant; (4) corporate income taxes; (5) personal income taxes as specified in section 743. (b) Each approved international financial services entity eligible for tax incentive benefits provided under this subchapter must be granted one hundred percent benefits for a period of ten years if they remain in compliance with all the requirements of this chapter. Applicants may receive a renewal of benefits for ten years if they remain in compliance with all the requirements of this chapter for their initial benefit period. (c) Tax exemptions and benefits may be granted under this section only if the applicant granted a tax incentive benefit certificate can provide certification from the Bureau of Internal Revenue and the Department of Finance that the applicant has filed and paid all taxes, penalties and interest, and from the Office of the Lieutenant Governor that the applicant has filed its required annual report or has satisfactorily made agreement to pay the taxes or file the required reports. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 4(d), Sess. L. 2016, p. 387, 391.

(a) Each applicant granted a tax incentive benefit certificate shall have its income tax liability for income derived from the business for which the certificate is granted, and income from investment described in this section reduced on a current basis, as provided in this section. (b) All exemptions granted under section 742 must be made available to the applicant. (c) The option to choose the term and percentage of its tax exemptions granted under subsection (e) must be made available to the applicant. (d) An applicant may obtain tax benefits only commencing with the first day of the applicant's taxable year for income tax purposes, or commencing one day after the due date for the payment of an installment of estimated taxes by the applicant. If no payment of an installment of estimated income taxes by the applicant is due, then the date of commencement of the benefits under this section shall be the due date of such a payment if one were due by the applicant. (e) An international financial services entity is entitled to: (1) reduce the amount of each payment of estimated income tax by seventy-five percent if its principal place of business is located on St. Thomas or St. John, and ninety-five percent if its principal place of business is located within the town limits of Christiansted, St. Croix as defined by the Christiansted Town Limits map recorded in the Cadastral Section of the Office of the Tax Assessor, and by one hundred percent for a period of ten years, at which time the beneficiary must apply for renewal, if the principal place of business is located within the town limits of Frederiksted, St. Croix, as defined by the Frederiksted Town Limits map recorded in the Cadastral section of the Office of the Tax Assessor; and (2) reduce its income tax liability shown on its income tax return for the taxable year by seventy-five percent if its principal place of business is located on St. Thomas or St. John, and seventy-five percent if its principal place of business is located within the town limits of Christiansted, St. Croix as defined by the Christiansted Town Limits map recorded in the Cadastral section of the Office of the Tax Assessor, and by one hundred percent for a period of ten years, at which time the beneficiary must apply for renewal, if the principal place of business is located within the town limits of Frederiksted, St. Croix as defined by the Frederiksted Town Limits map recorded in the Cadastral section of the Office of the Tax Assessor for each of the years specified in the tax incentive benefit certificate or renewal thereof. In the case of estimated income taxes, such reduction must be prorated over the quarterly payments due, or constructively due by the applicant, or in the case of the determination of its income tax liability, by the entire amount of the subsidy thus constructively calculated. (f) The reduction of income tax liability on a current basis of, or the reduction of income taxes otherwise payable by, applicants entitled to such reduction is applicable with respect to all of the computations, assessments, and collection of such income taxes, as provided by the 26 U.S.C. section934(b)(1), the Internal Revenue Code of 1986, as amended, as applicable to the Virgin Islands. (g) A corporation that is organized under the laws of the Virgin Islands, a corporation that is organized under the laws of the United States, or one of the states, territories or commonwealths, whose principal office is located in the Virgin Islands is presumed to be continually domiciled in the Virgin Islands for purposes of this section, unless it is established that such domicile has been superseded by a new domicile. (h) This section applies to corporations, limited liability companies, limited liability partnerships, shareholders, members, partners, trusts, individuals or other direct or indirect owners of corporations or other entities. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), Sess. L. 2016, p. 387.

(a) Every person who receives a payment of dividends or interest subject to the tax imposed by section 871(a)(1) or 881 of the Internal Revenue Code, as it applies in the Virgin Islands from an IFSE as hereunder provided, and every such applicant subject to a tax on a dividend equivalent amount imposed by section 884 of the Internal Revenue Code, as it applies to the Virgin Islands, is exempted from the payment of 100% of such tax on interest and of that percentage of such tax on dividends and dividend equivalent amounts as is determined pursuant to subsection (b) of this section, to the extent that such dividends, interest and dividend equivalent amounts are derived from or related to the business or industry for which the certificate has been granted. (b) An applicant granted a tax benefit certificate as hereunder provided is exempted from the requirement to withhold tax pursuant to sections 1441 and 1442 of the Internal Revenue Code, as it applies in the Virgin Islands, with respect to the payments and dividend equivalent amounts referred to in subsection (a) of this section to the extent that such payments and dividend equivalent amounts are exempt from the tax described in said subsection. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), Sess. L. 2016, p. 387.

(a) Applicants for benefits under section 743 may be granted an additional ten years of tax exemption on the initial term of benefits and subsidy at one hundred percent of benefits if the principal place of business of the applicant is located within the town limits of Frederiksted, St. Croix as defined on the Frederiksted Town Limits map recorded in the Office of the Tax Assessor. In all other geographical areas an extension of benefits for a five-year period may be granted by the Board. (b) An applicant granted benefits under this chapter must be allowed the option, to be exercised prior to the issuance of the tax incentive benefit certificate, of determining when any or all of the benefits commence, if all of the benefits commence at some point during the first five years of operation of the beneficiary's enterprise. (c) If the beneficiary owns and operates more than one enterprise in the Virgin Islands, benefits granted under this chapter apply only to activities authorized under subchapter I of this chapter. In addition, international financial services entities may make capital contributions in excess of $1,000,000 to Virgin Islands business entities and are permitted to take the tax benefits permitted by this chapter for any income or profit made from those investments. (d) With respect to a corporation or other legal entity, the Board may review the ownership structure, or the proposed ownership structure, and may, upon review of the applicant's business plan or amended business plan, and consistent with the basis purposes and objectives of this chapter, limit the number of shareholders. The Board may not unreasonably withhold approval of the ownership structure and may not impose additional requirements or limitations on ownership. Once the international financial services entity applicant has furnished all information necessary for review, the Board has 90 days to issue the decision. If the Board does not approve or deny the proposed ownership structure, the ownership structure is deemed to be approved. The Board has the authority to review all ownership interests in excess of five percent of the business. The international financial services entity shall, however, give the Board notice of owners holding less than a five-percent ownership interest in the company. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(a), (b), Sess. L. 2016, p. 387.

(a) Upon proper application or reapplication, public hearing and in compliance with all other relevant provisions of this chapter pertaining to the grant of initial benefits, as determined and required by the Board, any recipient of tax incentive benefits granted under this subchapter may be granted an extension, modification or renewal of those benefits subject to the conditions stated herein. (1) Benefits must be granted pursuant to the provision of this subchapter only, and not pursuant to the provisions of any previous law. (2) The Commissioner of Labor shall certify the applicant's compliance with all labor laws, and regulations prior to any extension, modification or renewal of benefits. (b) Certificate extensions, modifications or renewals are for a period approved by the Board. (c) The Board may grant an extension or modification of benefits under an existing certificate or grant a new certificate if the Board determines that the international financial services entity is helpful to the development of the economy of the Virgin Islands. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (b); 4(e), Sess. L. 2016, p. 387.

(a) Upon receipt of a finding by the Board that tax incentive benefits should be granted, the Board shall then proceed to issue the appropriate certificate. (b) If, after 60 calendar days, excluding Sundays and holidays, have elapsed from the date the Board has concluded his investigation of the applicant, the Board has neither approved nor disapproved the issuance of a tax incentive benefit certificate, the issuance of the certificate must be considered approved, pending final approval by the Lieutenant Governor. The Lieutenant Governor has an additional ten (10) days to approve or deny the license. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

(a) A tax incentive benefit certificate must be issued by the Board in the name of the Government of the Virgin Islands and must bear the signature of the Board. The certificate must specify all of the following: (1) In the case of a non-publicly owned corporation, the names and addresses of all of shareholders holding at least a five percent interest in the stock of the company; (2) The line or lines of businesses for which benefits have been granted; (3) The date by which the required financial investment was completed by the beneficiary; (4) The date or dates upon which benefits commence which may be retroactive to the first date of investment by the beneficiary in the industry or business granted in the certificate, but such date may not be before the effective date of this chapter. (5) The specific commencement and termination dates for the benefits granted under the certificate. (6) Such other conditions as the Board considers appropriate, not inconsistent with the provisions of this chapter or regulations promulgated under this chapter. (b) In addition to the conditions established in subsection (a), the certificate must contain a recital that it is conditioned upon the performance and observance of those conditions by the beneficiary within a period of time specified, and upon the final determination of the Secretary of the Treasury of the United States or the Secretary's delegate, of compliance with the requirement of Internal Revenue Code section 934. Upon failure of the beneficiary to perform or observe the conditions as required by the Board within the specified period or any extension thereof granted for good cause shown to the Board, the certificate is of no force and effect, and the beneficiary shall pay or refund as the case may be to the Government of the Virgin Islands the amount of any benefit actually received under the certificate. Upon a final determination by the Secretary of the Treasury of the United States or his delegate that the beneficiary has not complied with the requirements of the Internal Revenue Code section 934, the beneficiary shall pay or refund, as the case maybe, to the Government of the Virgin Islands, the amount of any subsidy benefits, based on income tax liability, actually received, or the amount of the reduction of income tax liability on a current basis for all the years of non-compliance. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

A tax incentive benefit certificate granted under this subchapter may be transferred, for the unexpired portion of the term of the certificate to another international financial services entity which succeeds the beneficiary in carrying on or in operating the industry or business for which the certificate is granted, upon determination of the Board that such international financial services entity is otherwise qualified to receive such benefits and that the industry or business activity with respect to which the certificate was granted is continued by the international financial services entity. Thereafter the transferor of the certificate loses all tax incentive benefits under this subchapter and is subject to the tax laws of the Virgin Islands. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(b); 4(f), Sess. L. 2016, p. 387, 392.

(a) A tax incentive benefit certificate granted in accordance with this subchapter may be revoked, suspended or modified by the Board, after notice, public hearing, and written findings by the Board that: (1) The beneficiary has failed to maintain compliance with the requirements of this chapter or any regulation hereunder; (2) Upon a finding submitted to the Board by the Lieutenant Governor or the Attorney General of the Virgin Islands that the international financial services entity: (A) has been dissolved; or (B) has filed, or there has been filed against the corporation, a petition in bankruptcy which has been approved; or (3) The beneficiary has failed to file an annual report as required by this chapter; or (4) An officer, shareholder or director acting on behalf of the international financial services entity has been convicted of a felony connected with the operation of the beneficiary's business or industry; or (5) An officer, shareholder or director acting on behalf of the international financial services entity has given or offered, or caused to be given or offered a bribe, or any money, property, or value of any kind or any promise or agreement therefore to a public officer, or to a person executing any of the functions of a public office, or to a person elected, appointed or designated to thereafter execute the same, with intent to influence him with respect to any act, decision, vote, opinion, or other proceeding in the exercise of the powers or functions which he has or may have pertaining in any way to the tax incentive benefit program. (b) In addition to the fine and imprisonment provided in 14 V.I.C. § 406 for this offense, any benefit granted or obtained as a result of an act, decision, vote, opinion or other proceeding under subsection (a)(5) is void as to the briber and recoverable from the briber as the circumstances of the particular case dictates. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(b); 4(g)(1)-(4), (h), Sess. L. 2016, p. 387, 392.

(a) Any official or employee of an international financial services entity, or of a person of which it is a unit who, on behalf of the international financial services entity receives any investor funds with the knowledge that the international financial services entity is insolvent shall be fined not less than $5,000, but not more than $25,000. (b) Any director, official or employee of the international financial services entity or of the person of which the international financial services entity is a unit, who appropriates, embezzles, removes or voluntarily misuses any monies, funds, credits or securities of an international financial services entity, or who, without due authorization, issues or draws any certificate of deposit, draws any order or bill of exchange, carries out any type of acceptance or assignment of a note, bond, money order, bill of exchange, and any person who, with the same intention, aids or abets any director, official or employee shall be fined not less than $5,000, but not more than $25,000 and may be liable to make restitution. (c) Any director, official, or employee of an international financial services entity or of the person of which the international financial services entity is a unit, who voluntarily misrepresents the financial condition of an international financial services entity or the facts about any transaction to be undertaken, or undertaken by the international financial services entity, or who declines to provide information rightfully requested by the Board shall be fined not less than $5,000, but not more than $25,000. (d) Any applicant or beneficiary who willfully makes a false or fraudulent statement or representation as to any fact required or appropriate to the determination of the eligibility of such applicant or beneficiary for benefits under the Code, this chapter, or the regulations for the continuation or extension of the same, or who willfully makes or presents any claim for benefits under the Code, this chapter or the regulations knowing the claim to be false, fictitious or fraudulent shall be fined not more than $25,000. In addition to a fine, the willful making of a false statements on an application may result in the rejection of the application. (e) If an international financial services entity violates any provision of title 29 Virgin Islands Code, chapter 12, or any rule or provision of its tax incentive benefit certificate, or fails or refuses to perform any duty, requirement or lawful order made by the Board, the international financial services entity is subject to a fine not to exceed $25,000 per violation. (f) The Board shall impose a fine of not less than $5,000, but not more than $25,000 for any violation of sections 718(a), 722, 723, 726, 729 or 740(a). (g) The Board shall impose a fine of not less than $10,000, but not more than $25,000 for any violation of sections 724(a) and 727(a). (h) The Board may impose a fine of not less than $5,000, but not more than $25,000 for any violation of this chapter not specifically enumerated in this section. The Board may impose a late fee of $100 per day not to exceed $10,000 per day, for each day the international financial services entity fails to comply with an order or meet a deadline imposed by the Board. (i) Multiple violations of the provisions set forth in this chapter are separate offenses and fines must be independently assessed. (j) The waiver or the failure to assess a fine for any violation is not a waiver of any other future or concurrent violation. (k) In construing or enforcing any provision of this chapter, the act, omission, or failure of any officer, agent, or person acting for or employed by any international financial services entity, acting within the scope of employment are considered an act, omission, or failure of the international financial services entity. (l) In addition to the imposition of a fine, the Board may also impose any other penalty authorized by law or under the regulations. (m) If any international financial services entity violates any provision of this chapter, any regulation promulgated under this chapter, or any provision of the tax incentive benefit certificate, or fails or refuses to perform any duty, requirement or lawful order made by the Board, such international financial services entity, after notice and an opportunity to be heard, must be fined in accordance with the schedule of fines under this section. These fines must be deposited into the General Treasury Fund. (n) The Attorney General of the Virgin Islands shall, at the request of the Board, bring appropriate action to compel adherence to, or enforce any lawful orders of the Board issued pursuant to this chapter, and to recover in the name of the Government of the Virgin Islands the penalties provided in this subchapter. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(b); 4(i)(a)-(c), Sess. L. 2016, p. 387, 392.

Any applicant or beneficiary aggrieved by any action of the Board under the provisions of this subchapter is entitled to judicial review of the action by appealing to the Superior Court under the applicable writ of review provisions no later than 30 days after a final decision by the Board or Lt. Governor. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, § 1(b), Sess. L. 2016, p. 387.

(a) Insofar as the laws of Virgin Islands are not inconsistent with the provisions of this chapter, the laws of the Virgin Islands shall prevail. (b) Insofar as the provisions of this chapter are inconsistent with any other laws of Virgin Islands, the provisions of this chapter shall prevail. (c) The banking-related authority granted to an international financial services entity under the provisions of this chapter are related to the federal banking laws of the United States as applicable to the Virgin Islands. Provided, nothing herein, shall be construed to limit the non-banking-related authority granted to an international financial services entity under the provisions of this chapter. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(a), (4)(j), (l), Sess. L. 2016, p. 387, 394.

History: Repealed. Jan. 20, 2017, No. 7968, § 4(k), Sess. L. 2016, p. 394.

As prescribed in section 717, five percent (5%) of the net income obtained from the Board's functions related to this chapter for any given fiscal year must be remitted to the non-profit foundation, Taproots, Inc., and ten percent (10%) to the Cancer Care Fund administered by the Department of Human Services. The remittance must be made within 30 days of the end of each fiscal year. Taproot is an organization designed to train and educate individuals and families in self-help, self-improvement, and entrepreneurial techniques to render them capable of developing resources for themselves. In the event that Taproots ceases to function or is formally dissolved, the Board shall remit the applicable funds to the Virgin Islands Treasury. History: Added Sept. 11, 2012, No. 7390, § 1(b), Sess. L. 2012, p. 194-230; amended Jan. 20, 2017, No. 7968, §§ 1(b); 4(l), Sess. L. 2016, p. 387, 394.

Notwithstanding anything to the contrary in this subchapter, an international financial services entity that was granted a license under this subchapter before January 20, 2017, and that seeks tax benefits, must apply for the tax benefits available under this subchapter. An international financial services entity that was granted a license under this subchapter after January 20, 2017, and that seeks tax benefits, must apply to the Virgin Islands Economic Development Commission for the tax benefits available and applicable under title 29 Virgin Islands Code. If the applicable requirements have been met, the Commission shall grant the benefits provided for in 29 V.I.C. § 713a without condition. Upon approval of a grant of benefits, the Commission shall proceed promptly to issue the certificate referred to in 29 V.I.C. chapter 25, subchapter II. History: Added Jan. 20, 2017, No. 7968, § 5, Sess. L. 2016, p. 394; amended June 14, 2018, No. 8056, § 15, Sess. L. 2018, p. 95.

This chapter is known and may be cited as "The Virgin Islands Finance Lenders Law". History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 386.

As used in this chapter, the terms have the meaning set forth in this section, unless the context requires otherwise. (a) The terms "accounts," "chattel paper," "documents," "general intangibles," "goods," "instruments," and "security interest," are as defined in the Virgin Islands Uniform Commercial Code, Title 11A, Virgin Islands Code. (b) "Board" means the Virgin Islands Banking Board established in 3 V.I.C. § 42, or the Banking Board's designee. (c) "Branch office license" means a license to engage in business as a finance lender or broker at a location other than the location identified in a finance lender or broker license application or amended application. (d) "Broker" includes any person who is engaged in the business of negotiating or performing any act as broker in connection with loans made by a finance lender. (e) "Depository institution" has the same meaning as in Section 3 of the Federal Deposit Insurance Act and includes any federal credit union as defined in section 262 of this title. (f) "Federal banking agencies" means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation. (g) "Finance lender" includes any person who is engaged in the business of making consumer loans or making commercial loans. The term includes in-house financing, which is a type of seller financing. (1) The terms, "finance lender" and "finance broker" do not include employees regularly employed at the location specified in the license of the finance lender or broker, except that an employee, when acting within the employee's scope employments is exempt from any other law from which the employee's employer is exempt. (2) The business of making consumer loans or commercial loans may include lending money and taking, in the name of the lender, or in any other name, in whole or in part, as security for a loan, any contract or obligation involving the forfeiture of rights in or to personal property, the use and possession of which property is retained by other than the mortgagee or lender, or any lien on, assignment of, or power of attorney relative to wages, salary, earnings, income, or commission. (h) "In-house financing" means a type of financing, which a retailor extends to its customers, allowing the purchaser to purchase its goods or services by obtaining a loan with interest. (i) "Licensee" means any finance lender or broker who receives a license in accordance with this chapter. (j) "Person" means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a joint stock company, a trust, an unincorporated organization, a government, or a political subdivision of a government. (k) "Regulatory ceiling provision" means a statement in a section or subchapter that specifies an original bona fide principal loan amount at or above which that section or subchapter does not apply to a loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 387-388.

(a) This chapter must be liberally construed and applied to promote its underlying purposes and policies, which are: (1) To ensure an adequate supply of credit to borrowers in this territory. (2) To simplify, clarify, and modernize the law governing loans made by finance lenders. (3) To foster competition among finance lenders. (4) To protect borrowers against unfair practices by some lenders, having due regard for the interests of legitimate and scrupulous lenders. (5) To permit and encourage the development of fair and economically sound lending practices. (6) To encourage and foster a sound economic climate in the Territory. (b) To accomplish its underlying purposes and policies, this chapter preserves existing chapters under title 9 of the Virgin Islands Code, which includes statutory law for banking institutions, small loans and pawnbrokers, savings and loans associations, mortgage lenders and brokers, mortgage loan originators and International Financial Services Entities. A finding that any provision of this chapter is invalid with respect to a particular lender or class of lenders does not affect the enforceability of this chapter with respect to any of the foregoing classifications of lenders, which in all events continue to be exempted by this chapter. (c) Consumer loans, as defined in sections 833(4) and 834, are subject to this chapter. All subchapters apply to consumer loans, except subchapter 10. (d) Commercial loans, as defined in section 914(c), are subject to this chapter. All subchapters except for subchapters 5, 6, 7, 8 and 9 apply to commercial loans. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 388-389.

(a) This chapter does not apply to any person doing business under any law of any state or territory or of the United States relating to banks, trust companies, savings and loan associations, insurance premium finance agencies, federal credit unions, small loans and pawnbrokers, mortgage lenders and brokers, mortgage loan originators and International Financial Services Entities when acting under federal law or other state authority. (b) This chapter does not apply to a check casher who holds a valid license issued pursuant to section 521 of this title when acting under the authority of that license. (c) This chapter does not apply to a college or university making a loan for the purpose of permitting a person to pursue a program or course of study leading to a degree or certificate. (d) This chapter does not apply to a broker-dealer acting pursuant to a certificate then in effect and issued pursuant to section 631 of this title. (e) This chapter does not apply to any person who makes five loans or less in a 12-month period, these loans are commercial loans as defined in section 914(c), and the loans are incidental to the business of the person relying upon the exemption. (f) This chapter does not apply to any public corporation, any public entity or any agency of any one or more of the foregoing, when making any loan so long as the public corporation, public entity, or agency of any one or more of the foregoing complies with all applicable federal, state and territorial laws and regulations. (g) This chapter does not apply to the Economic Development Bank, authorized pursuant to chapter 21 of title 29 Virgin Islands Code. (h) This chapter does not apply to any loan that is made or arranged by any person licensed as a real estate broker by the Territory and secured by a lien on real property, or to any licensed real estate broker when making such a loan. A licensed real estate broker may make a loan secured by a lien on real property for sale to a finance lender or arrange for a loan secured by a lien on real property to be made by a Finance lender without obtaining a license under this chapter. (i) In any proceeding under the law the burden of proving an exemption is upon the person claiming it. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 389-390.

This chapter does not apply to the following: (1) Any nonprofit cooperative association that loans or advances money in connection with any activity mentioned in paragraph (2). (2) Any corporation, association, syndicate, joint stock company, or partnership engaged exclusively in the business of marketing agricultural, horticultural, viticultural, dairy, livestock, poultry, or bee products on a cooperative nonprofit basis that loans or advances money to its members or in connection with those businesses. (3) Any corporation securing money or credit from any federal intermediate credit bank organized and existing pursuant to the provisions of an act of Congress entitled "Agricultural Credits Act of 1923" which loans or advances money or credit so secured. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 390.

This chapter does not apply to any loan of credit made by a person not licensed under this chapter pursuant to a plan having all of the following characteristics: (1) Credit cards issued pursuant to a written application and to the plan whereby the organization issuing the cards can acquire those obligations that its members in good standing incur with those persons with whom the organization has entered into written agreements setting forth the plan, and where the obligations are incurred pursuant to those agreements; or whereby the organization issuing the cards can extend credit to its members. (2) The fee for the credit cards is designed to cover the administrative costs of the plan and is imposed upon the issuance of the card and on annual renewal dates thereafter. (3) Any charges, discounts, or fees resulting from the acquisition of the charges paid to the organization issuing the credit cards by the persons, corporations, or associations with whom the organization has entered into written agreements. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 390.

This chapter does not apply to insurance premium financing companies as defined in 22 V.I.C. § 1621(a). History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 390.

A license to act as a broker under this chapter does not authorize the licensee to negotiate or perform any act as a broker in connection with loans made or to be made by a lender not licensed as a finance lender under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 390.

This chapter does not apply to a loan made or arranged by a licensed residential mortgage lender or broker when acting under the authority of that license. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 391.

(a) This chapter does not apply to any nonprofit church extension fund. (b) For purposes of this section: (1) "Nonprofit church extension fund" means a nonprofit organization affiliated with a church, that is formed for the purpose of making loans to that church's congregational organization or organizations for site acquisitions, new facilities, or improvements to existing facilities, purchased for the benefit of the church congregational organization. (2) What constitutes a "church" must be determined from the following criteria, none of which has controlling weight: (A) a distinct legal existence; (B) a recognized creed and form of worship; (C) a definite and distinct ecclesiastical government; (D) a formal code of doctrine and discipline; (E) a distinct religious history; (F) a membership not associated with any other religion or denomination; (G) a complete organization of ordained ministers ministering to their congregations; ordained ministers selected after completing prescribed courses of study; (H) a literature of its own; (I) established places of worship; (J) regular congregations; regular religious services; or (K) schools for the religious instruction of youth; and schools for the preparation of its ministers. (3) "Church congregational organization" means a group of individuals that gathers for the purpose of practicing the religion or manner of worship promulgated by the church with which the organization is affiliated. (4) "Site acquisitions" means purchases of land intended for use by a church congregational organization. (5) "New facilities" means purchases of buildings or structures intended for use by a church congregational organization. (6) "Improvements" means purchases of materials intended to increase the quality of existing religious sites or facilities. (c) For purposes of this section, a nonprofit church extension fund must establish that it is exempt from federal taxation pursuant to Section 501 of Title 26 of the United States Code. (d) For purposes of this section, no individual may be held responsible for the repayment of any loan made by a nonprofit church extension fund. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 391-392.

(a) This chapter does not apply to either of the following: (1) A commercial bridge loan made by a venture capital company to an operating company. (2) A venture capital investment made by a venture capital company in an equity security issued by an operating company. (b) For purposes of this section: (1) "Venture capital company" means a person other than an individual or sole proprietorship that meets all of the following: (A) Engages primarily in the business of promoting economic, business, or industrial development through venture capital investments or the provision of financial or management assistance to operating companies. (B) At all times maintains at least 50 percent of its assets in venture capital investments or commitments to make venture capital investments, and maintains or, assuming consummation of the equity investment to which the commercial bridge loan relates, will maintain a material equity interest in the operating company. (C) Approves each loan made to an operating company through the venture capital company's board of directors, executive committee, or similar policy body, based on a reasonable belief that the loan is appropriate for the operating company after reasonable inquiry concerning the operating company's financing objectives and financial situation. (D) Complies, when making the loan, with all applicable federal and territorial laws and rules or orders governing securities transactions including, but not limited to, the Securities Act of 1933, the SecuritiSecurities Actt of 1934, the InvSecurities Exchange Act of 1934 and Investment Company Act of 1940f 1968. (2) "Operating company" means a person that meets all of the following: (A) Primarily engages, wholly or substantially, directly or indirectly through a majority owned subsidiary or subsidiaries, in the production or sale, or the research or development, of a product or service other than the management or investment of capital. This does not include any of the following: (i) A person that is either an individual or a sole proprietorship. (ii) A person that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies or other entity or person. (B) Uses all of the proceeds of the commercial bridge loan for the operations of its business. (C) Approves each commercial bridge loan through its board of directors, executive committee, or similar policy board, in the exercise of its fiduciary duty, based on a reasonable belief that the loan is appropriate for the operating company after reasonable inquiry concerning the operating company's financing objectives and financial situation. (3) "Commercial bridge loan" means a loan that meets all of the following criteria: (A) A loan of a principal amount of $5,000 or more, or any loan under an open-end credit program, whether secured by personal property or unsecured, the proceeds of which are intended by the operating company for use primarily for other than personal, family, or household purposes. (B) Is made with a maturity date not to exceed three years, and in connection with or in bona fide contemplation of, an equity investment in the operating company. (C) Is secured, if at all, solely by the operating company's business assets, exclusive of any real property. (D) Is subject to the implied covenant of good faith pursuant to 11A V.I.C. § 3-103. (4) For purposes of paragraph paragraph (1) capital investment" is an acquisition of securities in an operating company that a person, an investment adviser of the person, or an affiliated person of either, has or obtains management rights to. (5) "Equity security" has the same meaning as in section 3(a)(11) of the Federal Securities Exchange Act of 1934. (c) For purposes of paragraph (3) of subsection (b), for the purposes of determining whether a loan is a commercial bridge loan, a venture capital company may rely on any written statement of intended purposes signed by the operating company. The statement may be a separate statement signed by the operating company or may be contained in another document signed by the operating company, but in each case, it must be approved by its board of directors, executive committee, or similar policy body. The venture capital company is not required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. (d) For purposes of subsection (b), paragraph (3), subparagraph (A), the principles set forth in section 916 must be used to determine whether the specified amount of a commercial bridge loan is a bona fide principal amount. (e) Nothing in this section is intended to abrogate or diminish the application of any other law that are designed to protect borrowers, including, but not limited to, laws pertaining to licensing, unfair competition, usury, and conflicts of interest. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 392-394.

(a) This chapter does not apply to a franchise loan made by a franchisor to a franchisee or a sub-franchisor or by a sub-franchisor to a franchisee. (b) For purposes of this section: (1) "Franchised business" means a business operated pursuant to a franchise or area franchise by a franchisee or pursuant to a franchise, area franchise or sub-franchise by a sub-franchisor. (2) "Franchise loan" means a commercial loan, as defined in section 914(c), made by a franchisor to a current or prospective franchisee or sub-franchisor or a commercial loan by a sub-franchisor to a current or prospective franchisee for the acquisition, construction, operation, development, equipping, expansion, contraction, consolidation, merger, recapitalization, reorganization, or termination of a franchised business provided that the following conditions are satisfied: (A) The franchisor or sub-franchisor making the franchise loan complies with all applicable federal and state franchise disclosure and registration laws, regulations, rules and orders and the Federal Trade Commission Franchise Rule: Disclosure Requirements and Prohibitions Concerning Franchising and Business Opportunity Ventures 16CFR 436, as amended, in connection with the offer or sale of any franchise, area franchise, or sub-franchise to which the franchise loan relates. (B) The proceeds of the franchise loan are intended by the borrowing franchisee or sub-franchisor for use primarily for other than personal, family, or household purposes. (C) The loan, if secured, is secured solely by the assets of the franchised business to which the franchise loan relates. Property used by the borrower primarily for personal, family, or household purposes, including the borrower's personal residence, may not be taken as security for the loan. (D) The loan is subject to the implied covenant of good faith under section 11A V.I.C. § 3 - 103. (E) The lender fully and clearly discloses to the borrower, at or before the time the loan is made, the rates of interest, charges, and costs of the loan. (c) For purposes of subsection (b), paragraph (2) subparagraph (B), a lending franchisor or sub-franchisor may rely on any written statement of intended purposes by the borrowing franchisee or sub-franchisor. The statement may be a separate statement signed by the borrowing franchisee or sub-franchisor or may be contained in another document signed by the borrowing franchisee or sub-franchisor. The lending franchisor or sub-franchisor may not be required to ascertain that the proceeds of a franchise loan are used in accordance with the statement of intended purposes. (d) Nothing in this section is intended to abrogate or diminish the application of any other laws that are designed to protect borrowers, including, but not limited to, laws pertaining to licensing, unfair competition, usury and conflicts of interest. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 394-395.

(a) This chapter does not apply to the following: (1) A program-related investment defined in subsection (c) of Section 4944 of th4944 of the Internal Revenue Coded StaUnited States Treasury Regulations, Section 53.4944-3ade by a private foundation, tax-exempt organization within the meaning of Section 509(a) of the Internal Revenue Code. (2) A loan, guaranty, or investment made by a public charity, tax-exempt organization within the meaning of paragraph (1), (2), or (3) of subsection (a) of Section 509 of the Internal Revenue Code that meets all of the following requirements: (A) The primary purpose of the loan, guaranty, or investment is to accomplish one or more of the exempt purposes of the public charity making the loan, as described in Section 170(c)(2)(B) of the Internal Revenue Code. (B) Neither the production of income nor the appreciation of property is a significant purpose of the loan, guaranty, or investment. (C) No purpose of the loan, guaranty, or investment is to accomplish one or more of the purposes described in Section 170(c)(2)(D) of the Internal Revenue Code. (b) Subsection (a) does not exempt a tax-exempt organization that is making consumer loans as defined in sections 833(4) and 834. (c) A loan that is secured by any assets owned by an individual is exempt under subsection (a) only if the individual providing the security is an "accredited investor" as defined in paragraph (5) or (6) of subsection (a) of section 230.501 of title 17 of the Code of Federal Regulations. Property held by an individual for personal, family, or household purposes, including an individual's personal residence, may not be taken as security for a loan. (d) A program-related investment by a private foundation, and any loan, guaranty, or investment made by a public charity that is exempt under subsection (a) if it is subject to the implied covenant of good faith under section 3- 103 of title 11A, Virgin Islands Code. (e) Exempt under subsection (a) is (1) a program-related investment by a private foundation, or a loan, guaranty, or investment by a public charity, only if the following conditions are satisfied: (A) The organization making the program-related investment, loan, guaranty, or investment is exempt from federal income taxes under Section 501(c)(3) 501(c) (3) of the Internal Revenue Codeganized and operated exclusively for one or more of the purposes described in Section 501(c)(3) of the Internal Revenue Code; (B) No part of the net earnings of the organization making the program-related investment, loan, guaranty or investment inures to the benefit of a private shareholder or individual; (C) No broker's fee will be paid in connection with the making of the program-related investment, loan, guaranty, or investment or placement of the program-related investment, loan, guaranty or investment; and (2) This subsection does not prohibit the organization making the program-related investment, loan, guaranty, or investment from charging interest on the loan or investment or fees on the guaranty. (f) Subsection (a) exempts from the provisions of this section only a program-related investment by a private foundation or a loan, guaranty, or investment by a public charity that is made for the primary purpose of accomplishing one or more of the organization's exempt purposes described in Section 501(c)(3) of the Internal Revenue Code, and no significant purpose of which is the production of income or the appreciation of property within the meaning of subsection (c) of Section 4944 of the Internal Revenue Code. A recipient shall use all funds received from the private foundation or the public charity only for the charitable purposes for which the program-related investment, loan, guaranty, or investment was made. (g) Only program-related investment by a private foundation or a loan, guaranty, or investment by a public charity is exempt under subsection (a) if the organization consummates not more than 35 loans in a calendar year. In the making and negotiating of these loans, the private foundation or public charity shall take into consideration the financial ability of the recipients to repay the loans in the time and manner provided. (h) Nothing in this section is intended to abrogate or diminish the application of any other applicable laws that are designed to govern the tax-exempt organizations described in subsection (a), including, but not limited to, laws pertaining to recordkeeping and reporting to the Attorney General and the Internal Revenue Service or to protect borrowers, including, but not limited to, laws pertaining to licenses, unfair competition, usury, and conflicts of interest. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 395-397.

In any proceeding under this chapter the burden of proving an exemption is on the person claiming it. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 397.

(a) It is unlawful for any person to engage in the business of a finance lender or broker without obtaining a license from the Board. (b) A finance lender or broker may not make or broker a residential mortgage loan unless that loan is offered by, negotiated by, or applied for through a licensed mortgage loan originator and the finance lender or broker also holds a valid license under chapter 20 of this title. (c) Every licensee that is also a mortgage lender or mortgage broker under chapter 20 of this title engaging in the business of making or brokering residential mortgage loans shall require that every mortgage loan originator employed or compensated by that licensee obtains and maintains a mortgage loan originator license from the Board under chapter 20 of this title. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 397-398.

(a) The finance lender or broker license must state the name of the licensee, and if the licensee is a partnership, the names of its general partners, and if a corporation or an association, the date and place of its incorporation or organization, and the address of the licensee's principal business location. On the approval and licensing of a location pursuant to sections 782 or 787, the Board shall issue an original license endorsed to show the address of the authorized location and, if applicable, the name of the subsidiary corporation licensed to operate the location. The license must state whether the licensee is licensed as a finance lender or a finance broker. (b) An application for a license for a business location outside this Territory constitutes an agreement by the applicant to do all of the following: (1) Make the licensee's books, accounts, papers, records, and files mortgage lender to the Banking Board in this Territory. (2) Pay the reasonable expenses for travel, meals, and lodging of the Board or the Board's representatives incurred during any investigation or examination made at the licensee's location outside this Territory. (c) A licensee located outside this territory is not required to maintain books and records regarding licensed loans separate from those for other loans if the licensed loans can be readily identified. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 398.

Each finance lender and broker and mortgage lender and broker is required to hold a separate license and pay the respective fees for each license, if applicable. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 398.

(a) At the time of filing the application for a finance lender, the applicant shall pay to the Board the sum of $200 as a fee for investigating the application, plus the cost of fingerprint processing and the criminal history record check under section 784 and $300 as an application fee. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn. (b) A finance lender shall pay a licensure fee of $2,500. (c) A finance broker shall pay a licensure fee of $ 1,500. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 398.

(a) An application for a license as a finance lender under this chapter must be in the form and contain the information that the Board may by regulations require and must be filed with the payment of the fees specified in section 781. (b) An applicant who does not hold a license as a finance lender under this chapter shall furnish, the applicant's application, a full set of fingerprints and related information for purposes of the Board's conducting a criminal history record check for the person responsible for lending activities. (c) Nothing in this section may be construed to prevent a licensee from engaging in the business of a finance lender through a subsidiary corporation if the subsidiary corporation is licensed under this chapter. (d) For purposes of this section, "subsidiary corporation" means a corporation that is wholly owned by a licensee. (e) A new application is not be required for a change in the street address of an existing location previously licensed under this chapter. However, the licensee shall comply with the requirements of section 793. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 399.

Principal Officers (a) Upon the filing of an application pursuant to section 782 and the payment of the fees, the Board shall investigate the applicant and its general partners and persons owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any person responsible for the conduct of the applicant's lending activities in this territory, if the applicant is a partnership. If the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the Board shall investigate the applicant, its principal officers, directors, managing members, and persons owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any person responsible for the conduct of the applicant's lending activities in this territory. Upon the filing of an application pursuant to section 782 and the payment of the fees, the Board shall investigate the person responsible for the lending activity of the licensee at the new location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this chapter. If the Board determines that the applicant has satisfied this chapter and does not find facts constituting reasons for denial under section 789, the Board shall issue and deliver a license to the applicant. (b) For the purposes of this section, "principal officers" means the president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicant's lending activities within the Territory. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 399-400.

(a) The Division of Banking, Insurance and Financial Regulation, as designee of the Board shall submit images of fingerprints and related information of any person responsible for the lending activity, as defined by subsection (a) of section 782, for purposes of obtaining information as to the existence and content of a record of state or federal convictions and state or federal arrests. (b) The agency providing background check shall provide its response to the Division of Banking, Insurance and Financial Regulation, as designee of the Board. (c) The Board shall request from the agency subsequent arrest notification service, for license candidates described in subsection (a). (d) The Board shall charge a fee sufficient to cover the costs of processing the fingerprints requests pursuant to this section. (e) Notwithstanding subsections (a) to (e), inclusive, the Board may by regulation require fingerprints submitted by an applicant to be submitted to the Nationwide Mortgage Licensing System and Registry. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 400.

The applicant shall file with the application for a finance lender or broker license audited financial statements prepared in accordance with generally accepted accounting principles and acceptable to the Board which indicate a minimum net worth of at least $100,000 for finance lenders or $25,000 for finance broker. A licensee shall maintain the required net worth at all times. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 400.

(a) A licensee shall maintain a surety bond in accordance with this subsection in a minimum amount of $25,000. The bond must be payable to the Government of the Virgin Islands and issued by an insurer authorized to do business in the Virgin Islands. An original surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, must be filed with the Board not later than 10 days after execution. For licensees with multiple licensed locations, only one surety bond is required. The bond must be used for the recovery of expenses, fines, and fees levied by the Board in accordance with this chapter or for losses or damages incurred by borrowers or consumers as the result of a licensee's noncompliance with the requirements of this chapter. (b) When an action is commenced on a licensee's bond, the Board may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond by 10 days after the recovery on a bond, or by 10 days after notification by the Board that a new bond is required, constitutes sufficient ground for the suspension or revocation of the license. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 400-401.

(a) A finance lender or broker licensee seeking to engage in business at a new location other than the licensee principal place of business shall submit an application for a branch office license to the Board at least 60 days before seeking to engage in business at a new location and pay the fee required by section 781. (b) (1) The Board shall approve or deny the person responsible for the lending activity at the new location in accordance with section 789 and shall notify the licensee of this decision no later than 45 days after the date of receipt of the application. (2) If the Board denies the application, the licensee may submit to the Board not later than 15 days after the date of receipt of notification of the Board's denial a new application designating a different person responsible for the lending activity at the new location. The Board shall approve or deny the different person as provided in paragraph (1). (c) A licensee may not engage in business at a new location in a name other than a name approved by the Board. (d) The Board may adopt regulations to implement the requirements of this section. (e) A branch office license to engage in business at a new location must be issued in accordance with this section. A change of street address of a place of business designated in a license must be made in accordance with section 793 and does not constitute a new location subject to the requirements of this section. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 401.

(a) The Board may require licensees to file, at the times that the Banking Board may specify, information as to changes in the information provided in any application filed with the Boards pursuant to this chapter. (b) The Board may by regulation require a licensee to file information through Nationwide Mortgage Licensing System and Registry. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 401.

Upon reasonable notice and opportunity to be heard, the Board may deny the application for a finance lender or broker license for any of the following reasons: (1) A false statement of a material fact has been made in the application. (2) The applicant or an officer, director, general partner, person responsible for the applicant's lending activities in the Territory, or person owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant has, within the last 10 years, been convicted of or pleaded nolo contendere to a crime, or committed an act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this chapter. (3) The applicant or an officer, director, general partner, person responsible for the applicant's lending activities in the Territory, or person owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant has violated any provision of this chapter or the regulations under this chapter, or any similar regulatory scheme of the Virgin Islands or a foreign jurisdiction. (4) The application is considered withdrawn within the meaning of this section if the applicant fails to respond to a written notification of a deficiency in the application by 30 days after the date of the notification. (5) The Board shall either issue or deny the license not later than 90 days from the filing of a full and complete application for a license with the required fees. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 401-402.

(a) (1) If an applicant does not meet the requirements of licensure under this chapter, the Board shall: (A) notify the applicant in writing of this fact as provided in subsection (b); (B) return the bond filed; and (C) refund the license fee. (2) The Board shall retain the application and investigation fees. (b) No later than 30 days after the Board denies an application, the Board shall issue and send a written decision to the applicant. The written decision must contain: (1) an explanation of the reasons upon which the denial was based; and (2) a statement advising the applicant of a right to a hearing and the procedure for requesting a hearing. (c) An applicant who seeks a hearing on a license application denial shall file a written request not later than 15 days following receipt of the written decision for denial. (d) A hearing date established in response to the filing of a notice under this section may be postponed only once for a period of up to 30 days after the initial hearing date. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 402-403.

(a) The licensee shall post the finance lender license in a conspicuous place at the business authorized. (b) A license is not transferable or assignable. A license issued to a partnership or a limited partnership is not transferred or assigned within the meaning of this section by the death, withdrawal, or admission of a partner, general partner, or limited partner, unless the death, withdrawal, or admission dissolves the partnership to which the license was issued. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 403.

A finance lender or broker licensee shall maintain only one place of business under a duplicate or original license issued pursuant to section 782 or 787. The Board may issue more than one license to the same licensee upon compliance with all the provisions of this chapter governing an original issuance of a license. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 403.

(a) If a finance lender or broker licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide notice to the Board at least 60 days prior to the change. The Board shall notify the licensee not later than 15 days after its decision if the Banking Board disapproves the change. If the Board does not notify the licensee of disapproval within 15 days, the change in address is deemed approved. (b) If notice is not given at least 60 days before the change of a street address of a place of business, as required by subsection (a), or notice is not given at least 60 days before engaging in business at a new location, as required by section 787, the Board may assess a civil or administrative penalty on the licensee not to exceed $500. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 403.

(a) It is unlawful for a licensee to conduct the business of making loans under this chapter within any office, room, or place of business in which any other business is solicited or engaged in, or in association or conjunction therewith, except as is authorized in writing by the Board upon the Board's finding that the character of the other business is such that the granting of the authority would not facilitate evasions of this chapter or of regulations made pursuant to this chapter. An authorization once granted remains in effect until revoked by the Board. (b) The products or services of an affiliated corporation of the licensee that is a supervised financial institution, or a parent or subsidiary of a supervised financial institution that is an affiliate of the licensee, may be provided, offered, or sold at the licensed location of the licensee without authorization by the Board pursuant to subsection (a) if: (1) the activity is not prohibited by, or in violation of, the laws applicable to the affiliate or supervised financial institution, and (2) the products and services are not offered and sold in a manner that restricts the ability of the borrower or customer to individually select or reject a product or service that is offered. (c) The following definitions govern the construction of this section: (1) "Affiliated" or "affiliate" means the following: A corporation is an affiliate of, or a corporation is affiliated with, another specified corporation if it directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the other specified corporation. (2) "Supervised financial institution" means any commercial bank, industrial bank, credit card bank, trust company, savings and loan association, savings bank, federal credit union, Virgin Islands finance lender, residential mortgage lender or servicer, or insurer subject to supervision by an official or agency of the state or territory of the United States. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 403-404.

(a) Except as provided in subsection (b), it is unlawful for any finance lender or broker licensee to transact the business licensed or make any loan provided for by this chapter under any other name or at any other place of business than that named in the license. (b) A licensee may, however, make any loan and engage in any other business provided for by this chapter, other than the business described in subsection (b) of section 794, at a place other than the licensed location under either of the following conditions: (1) The borrower requests, either orally or in writing, that a loan be initiated or made at a location other than the licensee's licensed location. The use by the licensee of a preprinted solicitation form returned to the licensee by the borrower does not constitute a request by the borrower that a loan be initiated or made at a location other than the licensee's licensed location. (2) The licensee makes a solicitation or advertises for, or makes an offer of, a loan displayed on "home pages" or similar methods by the licensee on the Internet, the World Wide Web, or similar proprietary or common carrier electronic systems, and the prospective borrower may transmit information over these electronic systems to the licensee in connection with the licensee's offer to make a loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 404-405.

Finance lenders or broker licensees shall keep and use in their business, books, accounts, and records that will enable the Board to determine if the licensee is complying with this chapter and with the Board's regulations. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 405.

Finance lenders and brokers shall preserve their books, accounts, and records, including cards used in the card system, if any, for at least five years after making the final entry on any loan recorded therein. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 405.

Nothing contained in sections 796 and 797 requires the maintenance or preservation of original records, but any information requested by the Board must be furnished within 48 hours, excluding Saturdays, Sundays, and holidays. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 405.

(a) Finance lenders and broker licensees shall file an audited annual report with the Board, on or before the March 31, giving the relevant information that the Board reasonably requires concerning the business and operations conducted by the licensee within the Territory during the preceding calendar year for each licensed place of business. The individual audited annual reports filed pursuant to this section must be made available to the public for inspection except, upon request in the annual report to the Board, the balance sheet contained in the audited annual report of a sole proprietor or any other nonpublicly traded persons. The report must be made under oath and accompanied by a sworn affidavit and in the form prescribed by the Board. "Nonpublicly traded person" for purposes of this subsection means persons with securities owned by 35 or fewer individuals. (b) The annual reports must include: (1) the number and total dollar amount of loans each fiscal year for which a valid license is maintained by the licensee; (2) the number of loans made in each district in the Virgin Islands; (3) the income level; and (4) the total number of satisfaction of security instruments recorded with the Recorder of Deeds the prior year. (c) A licensee shall submit other special reports that may be required by the Board. History: Added Dec. 31, 2020, No. 8168, § 1, Sess. L. 2018, p. 405; amended Dec. 31, 2020, No. 8396, § 2, Sess. L. 2020, p. 257.

It is unlawful for any person subject to this chapter to do any of the following: (1) Make a materially false or misleading statement or representation to a borrower about the terms or conditions of that borrower's loan, when making or brokering the loan. (2) Advertise, print, display, publish, distribute, or broadcast, or cause or permit to be advertised, printed, displayed, published, distributed, or broadcast in any manner, any statement or representation with regard to the business subject to this chapter, including the rates, terms, or conditions for making or negotiating loans that is false, misleading, or deceptive, or that omits material information that is necessary to make the statements not false, misleading, or deceptive, or in the case of a licensee that refers to the supervision of the business by the Territory or any department or official of the Territory. (3) Knowingly misrepresent, circumvent, or conceal, through subterfuge or device, any material aspect or information regarding a transaction to which the person is a party. (4) Commit an act that constitutes fraud or dishonest dealings. (5) Commit an act that results in a felony conviction and the crime or act is substantially related to the qualifications, functions or duties of a person engaged in business. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 405-406.

It is unlawful for any licensee to place an advertisement disseminated primarily in this Territory for a loan unless the licensee discloses in the printed text of the advertisement, or in the oral text in the case of a radio or television advertisement, the license under which the loan would be made or arranged. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 406.

The Board shall require that rates of charge, if stated by a licensee, be stated fully and clearly in the manner that the Board considers necessary to prevent misunderstanding by prospective borrowers. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 406.

If any person engaged in the business regulated by this chapter refers in any advertising to rates of interest, charges, or cost of loans, the Board shall require that the rates, charges, or costs are stated fully and clearly in the manner that gives adequate information to prospective borrowers. If the rates or costs advertised do not apply to loans of all classes made or negotiated by the person, this fact must be clearly indicated in the advertisement. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 406.

(a) The Board may by order direct any licensee to submit advertising copy to the Board for review prior to use. (b) It is unlawful for any licensee to use an advertising copy after the Board has disapproved its use and notified the licensee in writing of the disapproval. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 406-407.

The Banking Board shall require licensees to maintain a file of all advertising copy for a period of three years from the date of its use. The file must be available to the Board upon request. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 407.

A licensed finance lender may act as a broker as defined in section 765 at its licensed place of business without obtaining an additional license as a broker under this chapter if the licensee has notified the Board of the action in writing. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 407.

(a) The Board may, after appropriate notice and opportunity for hearing, suspend for a period not to exceed 12 months or bar a person from any position of employment with a licensee if the Board finds that the person has willfully used or claimed without authority a designation or certification of special education, practice, or skill that the person has not attained, or willfully held out to the public a confusingly similar designation or certification for the purpose of misleading the public regarding the person's qualifications or experience. (b) Within 15 days from the date of a notice of intention to issue an order pursuant to subsection (a), the person may request a hearing under this chapter and the regulations issued pursuant to this chapter. Upon receiving a request, the matter must be set for hearing to commence within 30 days after receipt unless the person subject to this chapter consents to a later date. If no hearing is requested within 15 days after the mailing or service of the notice and none is ordered by the Board, the failure to request a hearing constitutes a waiver of the right to a hearing. (c) Upon receipt of a notice of intention to issue an order pursuant to subsection (a), the person who is the subject of the proposed order is immediately prohibited from engaging in any activities subject to licensure under this chapter. (d) Persons suspended or barred under this section are prohibited from participating in any business activity of a licensed finance lender or broker, and from engaging in any business activity on the premises where a licensed finance lender or broker, is conducting its business. This subsection may not be construed to prohibit suspended or barred persons from having their personal transactions processed by a licensed finance lender or broker. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 407.

(a) The Board may, after appropriate notice and opportunity for hearing, by order, censure or suspend for a period not exceeding 12 months, or bar from any position of employment, management, or control, any finance lender or broker, or any other person, if the Board finds either of the following: (1) That the censure, suspension, or bar is in the public interest and that the person has committed or caused a violation of this chapter or regulation or order of the Board, and the violation was either known or should have been known by the person committing or causing it or has caused material damage to the finance lender or broker, or to the public. (2) That the person has been convicted of, or pleaded nolo contendere to any crime, or has been held liable in any civil action by final judgment, or any administrative judgment by any public agency, if that crime or civil or administrative judgment involved any offense involving dishonesty, fraud, or deceit, or any other offense reasonably related to the qualifications, functions, or duties of a person engaged in the business in accordance with this chapter. (b) Within 15 days from the date of receipt of order pursuant to subsection (a), the person may request a hearing under this chapter and the regulations issued pursuant to this chapter. Upon receipt of a request, the matter must be set for hearing to commence within 30 days after the receipt unless the person subject to this chapter consents to a later date. If no hearing is requested within 15 days after the mailing or service of the notice and none is ordered by the Board, the failure to request a hearing constitutes a waiver of the right to a hearing. (c) Upon receipt of a notice of intention to issue an order under this section, the person who is the subject of the proposed order is immediately prohibited from engaging in any activities subject to licensure under the law. (d) Persons suspended or barred under this section are prohibited from participating in any business activity of a finance lender, broker, or mortgage loan originator, and from engaging in any business activity on the premises where a finance lender or broker, is conducting business. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 407-408.

(a) It is unlawful for any person to knowingly alter, destroy, mutilate, conceal, cover up, falsify, or make a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the administration or enforcement of any provision of this chapter. (b) It is unlawful for any person to knowingly make an untrue statement to the Board during the course of licensing, investigation, or examination, with the intent to impede, obstruct, or influence the administration or enforcement of any provision of this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 408.

Lenders A finance lender or broker licensee shall adopt and adhere to policies and procedures that are reasonably intended to achieve the objectives set forth in the documents described in this section. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 409.

Fines (a) The Board may do one or more of the following: (1) Deny, suspend, revoke, condition, or decline to renew a finance lender or broker license for a violation of this chapter, or any regulations adopted thereunder. (2) Order restitution against any finance lender or broker licensee for a violation of this chapter. (3) Impose fines on any finance lender or broker licensee. (4) Issue orders or directives to any finance lender or broker under this chapter as follows: (A) Order or direct any finance lender or broker licensee to desist and refrain from conducting business, including immediate temporary orders to desist and refrain. (B) Order or direct any finance lender or broker licensee to cease any harmful activities or violations of this chapter, including immediate temporary orders to desist and refrain. (C) Enter immediate temporary orders to cease business under a license issued pursuant to the authority granted under section 778, if the Board determines that the license was erroneously granted, or finance lender or broker is in violation of this chapter and its continuation of business is to the detriment of the public. (D) Order or direct any other affirmative action as the Board deems necessary. (b) The Board may impose a civil penalty on any finance lender or broker licensee, if the Board finds, on the record after notice and opportunity for hearing, that the finance lender or broker licensee has violated or failed to comply with any requirement of this chapter or any regulation prescribed by the Board under this chapter or order issued under authority of this chapter. (c) The maximum amount of penalty for each act or omission described in subsection (b) is $25,000. (d) Each violation of any directive or order of the Board is a separate and distinct. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 409.

Finance lender and broker licenses issued under this chapter remain in effect until they are surrendered, revoked, or suspended. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

For the purpose of discovering violations of this chapter or securing information required by the Board in the administration and enforcement of this chapter, the Board may at any time investigate the loans and business, and examine the books, accounts, records, and files used in the business, of every person engaged in the business of a finance lender or broker, whether the person acts or claims to act as principal or agent, or under or without the authority of this chapter. For the purpose of examination, the Board has free access during business hours to the offices and places of business, books, accounts, papers, records, files, safes, and vaults of all these persons. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

In making any examination or investigation, the Board may, for a reasonable time not to exceed 60 days, take possession of the books, records, accounts, and other papers pertaining to the business. The Board may place a keeper in exclusive charge and custody of the books, records, accounts, and other papers in the office or place where they are usually kept. During possession, no person may remove or attempt to remove any of the books, accounts, papers, records, files, safes, and vaults, or any part thereof, except in compliance with a court order or written consent of the Banking Board. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

The officers, employees, partners, directors, and stockholders may inspect and examine the books, accounts, papers, records, files, safes, and vaults while they are in the custody of the Board. Employees may make entries in these documents reflecting current operations or transactions. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

The power of investigation and examination by the Board is not terminated by the surrender, suspension, or revocation of any license issued by it. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

Whenever the Board considers it necessary for the general welfare of the public, the Board has continuous authority to exercise the powers set forth in this chapter whether or not an application for a license has been filed with the Board, any license has been issued, or if issued, has been surrendered, suspended, or revoked. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 410.

(a) For any licensee, a disciplinary action taken by the Virgin Islands, another state or territory, an agency of the federal government, or another country for an action substantially related to the activity regulated under this chapter may be grounds for disciplinary action by the Board. A certified copy of the record of the disciplinary action taken against the licensee by the Virgin Islands, other state or territory, agency of the federal government, or other country is conclusive evidence of the events related therein. (b) Nothing in this section precludes the Board from applying a specific statutory provision in this chapter providing for discipline against a licensee as a result of disciplinary action taken against a licensee by the territory of the Virgin Islands, another state or territory, an agency of the federal government, or another country. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 411.

The Board may require the attendance of witnesses and examine under oath all persons whose testimony the Board requires relative to loans or business regulated by this chapter or to the subject matter of any examination, investigation, or hearing. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 411.

(a) The licensee or person examined shall pay the cost of each examination of the licensee or a person subject to this chapter to the Board, and the Board may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of an examination, the Board may use the estimated average hourly cost for all persons performing examinations of licensees or other person or persons subject to this chapter for the fiscal year. (b) When it becomes necessary to examine or investigate the books and records of a licensee required to be licensed under this chapter at a location outside of the Virgin Islands, the licensee is liable for, and shall pay to the Board, no later than 30 days after the expenses are incurred, the actual travel and reasonable living expenses incurred on account of its examination, supervision, and regulation, or shall pay a reasonable per diem rate approved by the Board. (c) For the purpose of this section only, no person other than a licensee may be deemed to be a person subject to this chapter until the person is determined to be a person subject to this chapter by an administrative hearing in accordance with regulations or by a judicial hearing in any court of competent jurisdiction. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 411.

(a) If, upon inspection, examination, or investigation, the Board has cause to believe that a licensee or other person is violating any provision of this chapter or any regulation or order thereunder, the Board, may issue an order to the licensee or person in writing, describing with particularity and the basis of the order. Each order may contain a concise statement of the action taken; the effective date of such action; the designation of the provisions of this title pursuant to which the action is taken; and a concise statement of the findings of the Board in support of the action. Additionally, the Order must contain the action necessary to correct the violation or violations identified and provide a reasonable time period or periods by which the violation or violations must be corrected. In addition, each order may assess an administrative fine not to exceed $10,000 that must be deposited in General Fund. In assessing a fine, the Board shall give due consideration to the appropriateness of the amount of the fine with respect to factors including the gravity of the violation, the good faith of the person or licensees cited, and the history of previous violations. An order issued or a fine assessed pursuant to this section, while constituting punishment for a violation of law, must be instead of other administrative discipline by the Board for the offense or offenses cited, and the order and fine payment thereof by a licensee may not be reported as disciplinary action taken by the Board. (b) Notwithstanding subsection (a), nothing in this section prevents the Board from issuing an order to cease and desist from engaging in a specific business or activity or activities, or an order to suspend all business operations to a person or licensee who is engaged in or who has engaged in continued or repeated violations of this chapter. In any of these circumstances, the sanctions authorized under this section are separate from, and in addition to, all other administrative, civil, or criminal remedies. (c) If, within 15 days from the receipt of the order, the licensee or person cited fails to notify the Board that of an intent to request a hearing as described in subsection (d), the Board shall deem the order final. (d) Any hearing under this section must be conducted in accordance with this chapter and the regulations issued pursuant to this chapter. (e) After the exhaustion of the review procedures provided for in this section, the Board may apply to the appropriate court for a judgment in the amount of the administrative fine and an order compelling the cited licensee or person to comply with the order of the Board. The application, which must include a certified copy of the final order of the Board, constitutes a sufficient showing to warrant the issuance of the judgment and order. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 411-412.

After an examination, investigation, or hearing under this chapter, if the Board considers it of public interest or advantage, the Board may certify a record to the proper prosecuting official of the city, county, or city and county in which the act complained of, examined, or investigated occurred. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 412.

The Board may require the production for examination in the Territory of all books, records, and supporting data used by the licensee in the preparation of its audited annual reports and any other report required to be submitted to the Board. The books, records, and supporting data must be made available for examination to the Board in the Territory no later than five working days after a written demand. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 413.

(a) Notwithstanding any other provisions of this chapter, the Board may upon three days' notice, suspend any license for a period not exceeding 30 days, pending investigation and hearing if the Board finds the continuation of business is to the detriment of the public. (b) Surrender of a license becomes effective 30 days after receipt of an application to surrender the license or within a shorter period of time that the Banking Board or its designee may determine, unless a revocation or suspension proceeding is pending when the application is filed or a proceeding to revoke or suspend or to impose conditions upon the surrender is instituted not later than 30 days after the application is filed. If a proceeding is pending or instituted, surrender of a license becomes effective at the time and upon the conditions that the Banking Board determines. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 413.

Any licensee may surrender any license by delivering to the Board written notice that the licensee surrenders that license. Surrender of the license does not affect the licensee's civil or criminal liability for acts committed prior to surrender of the license. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 413.

(a) Whenever, in the opinion of the Board, any person is engaged in the business as a broker or finance lender, as defined in this chapter, without a license from the Board, or any licensee is violating any provision of this chapter, the Board may order that person or licensee to desist and to refrain from engaging in the business or further violating this chapter. If, within 15 days after the order is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order is rescinded. (b) Notwithstanding subsection (a), if, after an investigation, the Board has reasonable grounds to believe that a person is conducting business in an unsafe or injurious manner, the Board shall, by written order addressed to that person, direct the discontinuance of the unsafe or injurious practices. The order is effective upon the violator's receipt but does not become final except in accordance with the provisions of section 807. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 413.

(a) Whenever the Board believes from evidence satisfactory to the Board that any person has violated or is about to violate a provision of this chapter, or a provision of any order, license, decision, demand, requirement, or any regulation adopted pursuant to this chapter, the Board may, in the Board's discretion, bring an action, or the Board may request the Attorney General to bring an action in the name of the people of the territory of the Virgin Islands, against that person to enjoin that person from continuing that violation or doing any act in furtherance of the violation. Upon a proper showing, a permanent or preliminary injunction, restraining order, or writ of mandate must be granted, and other ancillary relief may be granted as appropriate. (b) If the Board determines that it is in the public interest, the Board may include in any action authorized by subsection (a), a claim for ancillary relief, including, but not limited to, a claim for restitution, disgorgement, or damages on behalf of the persons injured by the act or practice constituting the subject matter of the action. The court has jurisdiction to award additional relief. (c) Any person who willfully violates any provisions of this chapter, or who willfully violates any regulation or order adopted pursuant to this chapter, is liable for a civil penalty not to exceed $25,000 for each violation, which must be assessed and recovered in a civil action brought in the name of the people of the territory of the Virgin Islands by the Board in any court of competent jurisdiction. (d) As applied to the penalties for acts in violation of this chapter, the remedies provided by this section and by other sections of this chapter are not exclusive and may be sought and employed in any combination to enforce the provisions of this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 414.

(a) The Board shall suspend or revoke any license, upon notice and reasonable opportunity to be heard, if the Board finds any of the following: (1) The licensee has failed to comply with any demand, ruling, or requirement of the Board or its design made pursuant to and within the authority of this chapter. (2) The licensee has violated any provision of this chapter or any regulation made by the Board under and within the authority of this chapter. (3) A fact or condition exists that, if it had existed at the time of the original application for the license, reasonably would have warranted the Board in refusing to issue the license originally. (4) There has been repeated failure by the finance lender, when making or negotiating loans, to take into consideration in determining the size and duration of loans, the financial ability of the borrower to repay the loan in the time and manner provided in the loan contract, or to refinance the loan at maturity. (b) A parent company license may not be suspended or revoked pursuant to this section as a result of any action or failure to act by a subsidiary licensee unless grounds exist for the suspension or revocation of the parent company license pursuant to this section. An order suspending or revoking a license or imposing sanctions against a licensee does not affect other licensed locations unless expressly stated in the order. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 414-415.

The Board may by order summarily suspend or revoke the license of any licensee if that person fails to file the audited annual report required by section 799 within 10 days after notice by the Board that the report is due and not filed. If, after an order is made, a request for hearing is filed in writing within 15 days and the hearing is not held within 30 days thereafter, the order is deemed rescinded as of its effective date. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 415.

The revocation, suspension, expiration, or surrender of any license does not impair or affect the obligation of any preexisting lawful contract between the licensee and any borrower. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 415.

(a) Before the Board takes any action by order under this chapter, unless specifically provided otherwise, the Board shall give the licensee an opportunity to request a hearing at least 15 days prior to the effective date of the Order. (b) The hearing notice to the licensee must be sent by certified mail, return receipt requested, to the principal place of business of the licensee at least 30 days before the hearing. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 415.

Every order, decision, license, or other official act of the Board is subject to judicial review of such action in the court of competent jurisdiction. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 415.

(a) As used in this subchapter: (1) "Charges" include the aggregate interest, fees, bonuses, commissions, brokerage, discounts, expenses, and other forms of costs charged, contracted for, or received by a licensee or any other person in connection with the investigating, arranging, negotiating, procuring, guaranteeing, making, servicing, collecting, and enforcing of a loan or forbearance of money, credit, goods, or things in action, or any other service rendered. (2) "Charges" include any profit or advantage of any kind that a licensee may contract for, collect, receive, or obtain by a collateral sale, purchase, or agreement, in connection with negotiating, arranging, making, or otherwise in connection with any loan. (3) "Charges" do not include any of the following: (A) Commissions received as a licensed insurance agent or broker in connection with insurance written as provided in section 848. (B) Amounts not in excess of the amounts in the Virgin IslVirgin Islands Code and regulations paid to holders of possessory liens to release motor vehicles that secure loans subject to this chapter. (C) Court costs, excluding attorney's fees, incurred in a suit and recovered against a debtor who defaults on the loan. (D) Fees paid to a licensee for the privilege of participating in an open-end credit program, which fees are to cover administrative costs and are imposed upon executing the open-end loan agreement and on annual renewal dates or anniversary dates thereafter. (E) Amounts received by a licensee from a seller, from whom the borrower obtains money, goods, labor, or services on credit, in connection with a transaction under an open-end credit program that are paid or deducted from the loan proceeds paid to the seller at the direction of the borrower and which are an obligation of the seller to the licensee for the privilege of allowing the seller to participate in the licensee's open-end credit program. Amounts received by a licensee from a seller pursuant to this subchapter may not exceed 6 percent of the loan proceeds paid to the seller at the direction of the borrower. (F) Actual and necessary fees not exceeding $500 paid in connection with the repossession of a motor vehicle to repossession agencies provided that the licensee complies with sections 866 and 867, and actual fees paid to a licensee is not in an amount that exceeds the amount specified by Virgin IslVirgin Islands Code and regulations. (G) Moneys paid to, and commissions and benefits received by, a licensee for the sale of goods, services, or insurance, whether or not the sale is in connection with a loan, that the buyer by a separately signed authorization acknowledges is optional, if sale of the goods, services, or insurance has been authorized pursuant to section 794. (4) "Consumer loan" means a loan, whether secured by either real or personal property, or both, or unsecured, the proceeds of which are intended by the borrower for use primarily for personal, family, or household purposes. For purposes of determining whether a loan is a consumer loan, the lender may rely on any written statement of intended purposes signed by the borrower. The statement may be a separate statement signed by the borrower or may be contained in a loan application or other document signed by the borrower. The lender is not required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. (b) Nothing in this section authorizes the taking of real property as security, except as specified in section 869. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 415-417.

(a) In addition to the definition of consumer loan in section 833(4), a "consumer loan" also means a loan of a principal amount of less than $50,000, the proceeds of which are intended by the borrower for use primarily for other than personal, family, or household purposes. For purposes of determining whether a loan is or is not a consumer loan, the lender may rely on any written statement of intended purposes signed by the borrower. The statement may be a separate statement signed by the borrower or may be contained in a loan application or other document signed by the borrower. The lender is not required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. (b) A consumer loan under this section is a loan secured in the manner provided for in this chapter if it is secured, in whole or in part, by any lien on, security interest in, assignment of, or power of attorney relative to income arising from the operation of a business by the borrower, such as accounts, and chattel paper, including the right to payment for accounts or chattel paper sold by the borrower prior to or contemporaneously with the making of the loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 417.

A licensee may not directly or indirectly charge, contract for, or receive any interest or charge of any nature unless a loan is made. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 417.

(a) Except as provided otherwise in subsection (b), a licensee may not directly or indirectly charge, contract for, or receive any interest or charge of any nature with respect to a loan of $5,000 or more unless the loan is made. (b) Notwithstanding subsection (a), whenever a loan of $5,000 or more is not consummated because of the borrower's failure to disclose outstanding liens or other information essential to making the loan or solely because of the borrower's failure to complete the loan in accordance with the loan application, a licensee may charge, contract for, and receive an amount equal to the actual expenses incurred by the licensee in connection with the preparation for the loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 417-418.

(a) Section 2-302 of title 11A, Virgin Islands Code applies to the provisions of a loan contract that is subject to this chapter. (b) A loan found to be unconscionable is in violation of this chapter and is subject to the remedies specified in this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 418.

(1) Every licensee who lends any sum of money may contract for and receive charges at a rate not exceeding the sum of the following: (a) Two and one-half percent per month on that part of the unpaid principal balance of any loan up to, including, but not in excess of $225. (b) Two percent per month on that portion of the unpaid principal balance in excess of $225 up to, including, but not in excess of $900. (c) One and one-half percent per month on that part of the unpaid principal balance in excess of $900 up to, including, but not in excess of $ 1,650. (d) One percent per month on any remainder of the unpaid balance in excess of $1,650. (2) This section does not apply to any loan of a bona fide principal amount of $2,500 or more as determined in accordance with section 885. (3) Notwithstanding paragraph (1), the maximum amount of interest rate that is directly or indirectly charged, contracted for, or received by any person seeking a consumer loan in the amount of the consumer lending bona fide principal amount of $50,000 or less must not be in excess of 26 percent. (4) Paragraphs (1) and (2) do not apply to persons seeking in-house financing. No interest rate in excess of 12 percent may be charged to persons seeking in-house financing of consumer auto loans or any other financing transactions where the loan is secured by a finance lender. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 418.

(a) As an alternative to the charges authorized by section 838(1), a licensee may contract for and receive charges at the greater of the following: (1) A rate not exceeding 1.6 percent per month on the unpaid principal balance. (2) A rate not exceeding five-sixths of 1 percent per month plus a percentage per month equal to one- twelfth of the annual rate prevailing on the 25th day of the second month of the quarter preceding the quarter in which the loan is made, as established by the Federal Reserve Bank of New York, on advances to member banks under Sections 13 and 13a of the Federal Reserve Act, as now in effect or hereafter from time to time amended, charges must be calculated on the unpaid principal balance. (b) This section does not apply to any loan of a bona fide principal amount of $2,500 or more as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 418-419.

In addition to the charges authorized by section 838 or 839, a licensee may contract for and receive an administrative fee, that must be fully earned immediately upon making the loan, with respect to a loan of a bona fide principal amount of not more than $2,500 at a rate not in excess of 5 percent of the principal amount, exclusive of the administrative fee, or $50, whichever is less, and with respect to a loan of a bona fide principal amount of $2,500 to $50,000, at an amount not to exceed $75. No administrative fee may be contracted for, or received in connection with the refinancing of a loan unless at least one year has elapsed since the receipt of a previous administrative fee paid by the borrower. Only one administrative fee may be contracted for or received until the loan has been repaid in full. For purposes of this section, "bona fide principal amount" must be determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 419.

No interest rate in excess of 26 percent may be directly or indirectly charged, contracted for, or received by any person seeking a consumer loan, and the total charges of the finance lender and broker and any other person in the aggregate may not exceed the maximum rate provided for in this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 419.

(a) Except as provided in section 840 and with regards to consumer loans, all charges on loans made under this chapter may be computed and paid only as a percentage per month of the unpaid principal balance or portions thereof and must be so expressed in every obligation signed by the borrower. The charges on loans must be computed on the basis of the number of days actually elapsed. For the purpose of these computations, a month is any period of 30 consecutive days. (b) The loan contract must provide for payment of the aggregate amount contracted to be paid in substantially equal periodical installments, the first of which may be due not less than 15 days nor more than one month and 15 days from the date the loan is made. This subchapter does not apply to a loan made to a graduate student at an accredited college or university while the student is actively pursuing a study program leading to a post baccalaureate degree, or to a student loan made by an eligible lender under the Higher Education Act of 1965, as amended, 20 U.S.C. §1070 et seq., or to a student loan made pursuant to the Public Health Service Act, as amended, 42 U.S.C. §294 et seq. (c) This section does not apply to open-end loans. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 419-420.

Notwithstanding section 842, a licensee may contract for and receive charges on the unpaid principal balance at a single annual percentage rate, applied on the basis of the number of days actually elapsed, if the annual rate would produce a finance charge at the maturity of the contract not in excess of the finance charge resulting from the application of the graduated rates specified in section 838, when the loan is paid according to its terms, and charges are computed on the basis that a month is any period of 30 consecutive days, as provided in section 842, but if prepayment in full occurs on or before the third installment date, all charges must be recomputed as a percentage per month of the unpaid principal balance or portions thereof, based on the number of days actually elapsed. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 420.

Except as provided in section 840 and with regards to consumer loans, no charges on loans made pursuant to this chapter may be paid, deducted, or received in advance, or compounded. However, if part or all of the consideration for a new loan contract is the unpaid balance of a prior loan, the principal amount payable under the new loan contract may include any unpaid interest that has accrued on the prior loan. The unpaid principal balance of a precomputed loan is the balance due after refund or credit of unearned interest as provided in section 886. At the time of making the loan, the licensee shall deliver to the borrower, or, at the direction of the borrower, deliver to another person, an amount equal to the face value of the loan and the note evidencing the loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 420.

(a) Except for a rebate or refund pursuant to any administrative, civil, or criminal action, or any act of the Board, a rebate or refund required to be made upon payment in full of a loan pursuant to this chapter need not be made if the aggregate of all rebates or refunds required in connection with a loan is less than $ 1. (b) No licensee may contract for or receive any payment required in connection with a loan for the purpose of avoiding a rebate or refund of less than $1. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 420.

No person in connection with or incidental to the making of any loan regulated by this chapter may require the borrower to contract for purchase, or agree to purchase, any other thing in connection with the loan. A policy of insurance of the type specified in section 848 and credit life and disability insurance is not prohibited by this section. A policy of mortgage guaranty insurance may not be deemed to be a collateral sale, purchase, or agreement within the terms of this section or of section 833(2) or 847. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 420-421.

No person in connection with, or incidental to, the making of a loan may require the borrower to enter into any collateral sales agreements or contracts, other than the contract of pledge, assignment, or mortgage of personal property, or if otherwise permitted by this chapter, the deed of trust, mortgage, or lien on real property, by the borrower to the lender as security for the repayment of the loan and charges on the loan. Private mortgage insurance, mortgage guaranty insurance, credit life insurance, and credit disability insurance are not prohibited by this section. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 421.

(a) Insurance on tangible personal or real property offered as security may not be deemed to be a collateral sale, purchase, or agreement within the terms of sections 833(2), 846, or 847, when all the following requirements are met: (1) The insurance is sold at standard rates through licensed insurance brokers or agents. (2) The property is reasonably insured against loss for a reasonable term, which may be up to the term of the loan. (3) The policy relating to personal property is made payable to the borrower or any member of the borrower's family even though the customary mortgagee clause is attached, or the mortgagee is co- assured. (4) Except in the case of purchase money encumbrances, the amount of title insurance may not exceed the principal amount of the loan that is secured by a deed of trust, mortgage, or lien on the real property that is the subject of the policy of title insurance. (5) The policy of title insurance insures the lender or is made payable jointly to the lender and the borrower as their interests may appear. (6) Title insurance is placed through a title insurance company, duly authorized to do business in the state in which the real property is located, at rates comparable to rates being used by other title insurance companies duly authorized to do business in that state. (7) Title insurance is placed in connection with the renewal or extension of a loan only when the additional cash advance is at least $1,000. (b) This section does not apply to any loan of a bona fide principal amount of $50,000 or more, or to a duly licensed finance lender in connection with the loan or loans as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 421-422.

(a) Credit insurance may not be deemed to be a collateral sale, purchase, or agreement within the terms of section 833(2), section 846, or section 847 when the insurance is provided in accordance with the Virgin Islands Insurance Code and this section. As used in this chapter: (1) "Credit insurance" means credit life, disability, and loss-of-income insurance, or any combination of these coverages. (2) "Credit life insurance" means a life insurance policy designed to pay off a borrower's debt if that borrower dies. The face value of a credit life insurance policy decreases proportionately with an outstanding loan amount as the loan is paid off over time until both reach zero value and "credit disability insurance" is defined as a type of disability insurance policy that makes payments if you become sick or disabled and are unable to work. (3) "Credit loss-of-income insurance" means insurance issued to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is involuntarily unemployed, as defined in the policy. (b) A licensee may provide credit insurance with the borrower's consent, the form to be approved by the Commissioner of Insurance, and a copy, together with evidence of its approval by the Commissioner of Insurance, and a copy of the schedule of rates together with evidence of its approval by the Commissioner, to be filed with the Board prior to the offer or sale of the credit insurance and in an amount not in excess of the amount of the indebtedness, and, with respect to credit life or disability insurance, may collect from the borrower an amount not in excess of that permitted by the Virgin Islands Insurance Code and rules and regulations. (c) If the loan is prepaid in full by cash, a new loan, refinancing, or otherwise, except by credit insurance, before the final installment date, the borrower shall receive a rebate of that amount computed in accordance with the formula approved by the Commissioner. (d) When charges for the loan are precomputed in accordance with section 886, any permitted deferment charge may be computed on the combined total of the precomputed charge and the credit insurance charge. Only one deferment charge may be collected in connection with any loan contract, irrespective of the number of borrowers, and only one borrower need be insured. The amount of the deferment charge may be deducted from the principal of the loan. (e) If life or disability insurance is provided, and if the insured borrower dies or becomes disabled during the term of the loan contract, the insurance must be sufficient to pay the total amount due on the loan, excluding unearned charges, outstanding on the date of death, or all amounts that become due on the loan during the period of disability, as the case may be, without any exception, reservation, or limitation, subject, however, to the provisions of section 850. (f) Any credit insurance provided must be in force as soon as the loan is made. A licensee may not require credit insurance as a condition of making a loan. (g) If a borrower procures credit insurance by or through a licensee, the statement required by section 877 must disclose the cost of the credit insurance to the borrower, and the licensee shall deliver or cause to be delivered to the borrower a copy of the policy, certificate, or other evidence thereof, within a reasonable time. If a licensee provides credit disability or loss-of-income insurance pursuant to this chapter, the licensee shall also deliver an understandable written statement to the borrower detailing the conditions under which the borrower will be entitled to make a claim under the insurance policy and the procedure to be followed in making the claim. This statement must be first approved by the Commissioner of Insurance. (h) The amount charged to the borrower for credit life or disability insurance may not exceed the amount established by the Virgin Islands Insurance Code and regulations. (i) Nothing in this chapter prevents a licensee from selling insurance as other business if authorized by section 794. (j) This section does not apply to any loan of a bona fide principal amount of $50,000 or more, or to a duly licensed finance lender in connection with the loan or loans as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 422-423.

(a) Credit disability insurance written pursuant to section 849 may not provide indemnity against the risk that the borrower will become disabled for a period of less than 14 days. The insurance may provide indemnity for any single period of continuous disability of 14 days or longer, after which the risk may become compensable. The insurance may be offered with retroactive coverage to an earlier date based upon the disability having continued for a period stated in the policy, but if insurance with retroactive coverage is offered, it must also be offered without retroactive coverage, and the premium rate for each coverage must be separately stated in writing to the borrower. (b) If insurance with retroactive coverage is provided, the coverage must provide for a prorated payment based upon the fraction of the month during which the insured is disabled, if the insured is continuously disabled during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage must provide for a prorated payment based upon the fraction of the month during which the insured is disabled, after first excluding the elimination period set forth in the policy. For the purpose of this subsection, a month is any period of 30 consecutive days. (c) Credit disability insurance, if made available by a licensee, must be available on a monthly or annual premium basis, and the premium by the month may not exceed a pro rata relationship to the annual premium. Credit disability insurance need not be offered for a period less than the term of the loan to which it is applicable, and no credit disability insurance may be written for a period in excess of the term of the loan to which it is applicable. (d) The monthly disability benefit payable with respect to an open-end loan may not exceed the monthly payment computed pursuant to section 892 on the outstanding balance at the time disability is incurred. (e) This section does not apply to any loan of a bona fide principal amount of $50,000 or more, as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 423-424.

A licensee may collect the cost of a lot book report purchased in lieu of the title insurance provided for in section 848. The cost is not included in charges as defined in this chapter or in determining the maximum charges that may be made under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 424.

On any loan made that is secured by real property, an appraisal fee not to exceed the actual cost of the appraisal may be charged by the licensee if a written appraisal is provided to the licensee by a qualified appraiser. Only one fee for appraising the same real property may be collected unless the borrower has obtained a new or additional loan and more than one year has elapsed since the prior appraisal. The fee is not included in charges as defined in this chapter or in determining the maximum charges that may be made under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 424.

(a) A licensee may collect a fee for use of an automated valuation model result prepared by a third party not to exceed the actual cost paid to the third party for a written automated valuation model result in lieu of the appraisal provided for in section 852. The borrower may not be charged for both an automated valuation model result and an appraisal as defined in section 852 for the same property in a single transaction. Only one fee for providing an automated valuation model result or an appraisal for the same real property may be collected unless the borrower has obtained a new or additional loan and more than one year has elapsed since the prior delivery of an automated valuation model result or an appraisal. However, if a fee for an automated valuation model result has been paid, an appraisal fee minus the amount that has been paid by the borrower for the automated valuation model result may be charged for an appraisal for the same real property within one year if the borrower has obtained a new or additional loan. The fee is not included in charges as defined in this chapter or in determining the maximum charges that may be made under this chapter. (b) A licensee in a loan transaction secured by real property must provide notice as described in this section to a borrower of the borrower's right to receive a copy of the automated valuation model result, if the borrower has paid the fee for the automated valuation model result. A borrower's written request for a copy of an automated valuation model result must be received by the licensee no later than 90 days after the licensee has provided notice of the action taken on the application, including a notice of incompleteness, or the application has been withdrawn. (c) The licensee shall mail or deliver a copy of an automated valuation model result no later than 15 days after receiving a written request from the borrower, or no later than 15 days after receiving the automated valuation model result, whichever occurs later. (d) If the loan is proposed to be secured by real property, the notice of the borrower's right to a copy of the automated valuation model result must be given in at least 10-point boldface type, as a separate document in a form that the borrower may retain, and not later than 15 days after the licensee receives the written application. The notice must include an address to which the request must be sent and specify that the borrower's request for the automated valuation model result must be in writing and must be received by the licensee not later than 90 days after the licensee provides notice of the action taken on the application or a notice of incompleteness, or in the case of a withdrawn application, 90 days after the withdrawal. The notice must also include the following statement: "An automated valuation model is not an appraisal. It is a computerized property valuation system that is used to derive a property value." Release of the automated valuation model result to the borrower may be conditioned upon payment of the fee. (e) This section does not apply to automated valuation model results obtained by licensees on property owned by the licensee, nor to automated valuation model results obtained by the licensee in anticipation of modifying any existing loan agreement if the licensee does not charge for the use of the automated valuation model result. (f) For purposes of this section, an "automated valuation model" is a computerized property valuation system that is used to derive a real property value. (g) Nothing in this section authorizes the use of an automated valuation model result instead of an appraisal that is required under territorial or federal law. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 424-426.

On any loan secured by real property, a licensee may not do either of the following: (1) Fail to disburse funds in accordance with a commitment to make a loan that is accepted by the applicant; or (2) Intentionally delay the closing of a loan for the sole purpose of increasing interest, costs, fees, or charges payable by the borrower. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 426.

Escrow fee are disallowed under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 426.

On any loan that is secured by real property, the fee to be paid to the trustee for reconveyance of the trust deed may be collected by the licensee for transmittal to the trustee. The fee is not included in charges defined in this chapter or in determining the applicable maximum charges that may be made under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 426.

With respect to a loan under this chapter, a fee not to exceed $40 for the return by a depository institution of a dishonored check, negotiable order of withdrawal, or share draft may be charged and collected by the licensee. The fee is not included in charges defined in this chapter or in determining the applicable maximum charges that may be made under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 426.

(a) A licensee may contract for and receive a delinquency fee not in excess of one of the following amounts: (1) For a period in default of not less than 10 days, an amount not in excess $25. (2) For a period in default of not less than 15 days, an amount not in excess of $35. (b) The delinquency fee may not be collected more than once for the same default and may be collected at the time of the default or at any time after the default. If the delinquency fee is deducted from any payment received after default occurs, and the deduction results in the default of a subsequent installment, no fee may be collected for the resulting default. The delinquency fee under this section is not included in charges defined in this chapter or in determining applicable maximum charges that may be made under this chapter. (c) For open-end loans made under subchapter 8, a licensee may not collect or receive the delinquency fee set forth in subsection (a) unless there is a minimum of 20 days, inclusive, between the monthly billing date and the date upon which the minimum payment is due, exclusive of the applicable grace period provided in subsection (a). (d) This section does not apply to precomputed loans as described in section 886. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 426-427.

Credit loss-of-income insurance provided pursuant to this subchapter is subject to the following conditions: (a) The insurance must provide indemnity in accordance with the terms of the policy after any single period of continuous unemployment of 45 days or less as determined by the policy, after which benefits must commence. The insurance may be offered with retroactive coverage to an earlier date based upon unemployment having continued for the period stated in the policy. (b) The statement required by section 876 must include disclosure of the term of the coverage, the conditions of coverage, the benefits to be paid, and the exclusions from coverage. (c) The borrower shall sign a certificate of voluntary acceptance of any credit loss-of-income insurance purchased. The certificate must state in boldface type that is larger than the type used in the loan contract that purchase of the insurance is not a necessary condition of receiving the loan, and that the insurance may be canceled by the borrower at any time within 15 days after it goes into effect. If the borrower cancels the insurance within 15 days, a full refund must be made of the premium paid. (d) The minimum benefit must be payment up to the agreed amount on not less than four benefit payments, as stated in the policy which accrue during a covered period of unemployment, but during the first 60 days after inception of the policy, the minimum benefit may be payment up to the agreed amount of one-half the number of benefit payments, as stated in the policy, which accrue during a covered period of unemployment. The maximum benefits must be established in the contract of insurance. (e) If combination credit disability and credit loss-of-income coverage is offered, credit disability and credit loss-of-income coverage must also be offered separately. (f) Benefits may not be denied because the insured cannot establish a valid claim for unemployment compensation benefits solely because the former employer was not required to contribute to the Virgin Islands Unemployment Fund. (g) If insurance with retroactive coverage is provided, the coverage must provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, provided that the insured is continuously unemployed during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage must provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, after first excluding the elimination period set forth in the policy. For the purpose of this subchapter, a month is any period of 30 consecutive days. (h) When unemployment continues for a number of months equal to or greater than the maximum number of benefit payments stated in the policy, the final payment must be equal to the difference between a benefit payment and the initial prorated payment. (i) As used in this section, "benefit payment" means payment of an amount equal to a loan repayment installment or a maximum amount established in the contract of insurance, whichever is less. (j) The minimum benefit payment offered may not be less than the amount of a loan repayment installment unless the borrower or borrowers have two or more sources of income. If the maximum benefit payment offered is less than the amount of a loan repayment installment, the borrower must also be offered coverage in which the maximum benefit payment is equal to the amount of a loan repayment installment. (k) This section does not apply to any loan of a bona fide principal amount of $50,000 or more, or to a duly licensed finance lender in connection with the loan or loans as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 427-428.

A loan lawfully made outside the Virgin Islands may be enforced in the Virgin Islands as to the unpaid principal balance of the loan together with the interest, consideration, brokerage, and all other charges, to the extent of but not to exceed the unpaid principal balance and the aggregate amount of interest, consideration, brokerage, and all other charges permitted by this chapter in connection with a loan of the same amount made within the Virgin Islands. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 428.

Territory Any person who collects or attempts to collect in the Virgin Islands the unpaid principal balance of a loan made outside the Virgin Islands and a greater aggregate amount of interest, consideration, brokerage, and all other charges in connection with the loan than is permitted by this chapter in connection with a loan of the same amount made within the Virgin Islands is subject to the provisions of this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 428-429.

Any person who contracts for or negotiates in the Virgin Islands a loan to be made outside the Virgin Islands for the purpose of evading or avoiding the provisions of this chapter is subject to the provisions of this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 429.

Every licensee shall display prominently in each licensed place of business a full and accurate schedule of the charges to be made and the method of computing the charges. The schedule is subject to the approval of the Board. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 429.

No person, except as authorized by this chapter, may directly or indirectly charge, contract for, or receive any interest, discount, or consideration greater than the lender would be permitted by law to charge if the person were not a licensee under this chapter, upon the loan, use, or forbearance of money, goods, or things in action, or upon the loan, use, or sale of credit. This section applies to any person, who by any device, subterfuge, or pretense charges, contracts for, or receives greater interest, consideration, or charges than is authorized by this chapter for any loan, use, or forbearance of money, goods, or things in action or for any loan, use, or sale of credit. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 429.

(a) It is unlawful for any licensee: (1) to knowingly induce any borrower to split up or divide any loan with any other licensee; or (2) to induce or permit any borrower to be or to become obligated directly or indirectly, or both, under more than one contract of loan at the same time with the same licensee for the purpose, or with the result of, obtaining a higher rate of charge than would otherwise be permitted by this chapter, except as otherwise required by the Federal Equal Credit Opportunity Act (15 U.S.C. Sec.1691 et seq.; P.L. 93-495 and Regulation B promulgated by the Board of Governors of the Federal Reserve System 12 C.F.R. 202 et seq. (b) For the purpose of this section, "borrower" includes any husband and wife, whether jointly or severally obligated. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 429.

Repossessed Or Surrendered Vehicle (a) This section applies to a loan secured in whole or in part by a lien on a motor vehicle. (b) Any provision in any loan contract to the contrary notwithstanding, at least 15 days' written notice of intent to dispose of a repossessed or surrendered motor vehicle must be given to all persons liable on the loan. The notice must be personally served or must be sent by certified mail, return receipt requested, or first-class mail, postage prepaid, directed to the last known address of the persons liable on the loan. Except as provided otherwise, a person is liable for any deficiency after disposition of the repossessed or surrendered motor vehicle only if the notice prescribed by this section is given not later than 60 days after repossession or surrender and does all of the following: (1) States that those persons shall have a right to redeem the motor vehicle by paying in full the indebtedness evidenced by the loan note until the expiration of 15 days from the date of giving or mailing the notice, provides an itemization of the loan balance and of any costs and fees authorized by this chapter, and states the computation or estimate of the amount of any credit for unearned finance charges or canceled insurance as of the date of the notice. (2) States either that there is a conditional right to reinstate the loan until the expiration of 15 days from the date of giving or mailing the notice and all the conditions precedent thereto or that there is no right of reinstatement and provides a statement of reasons therefor. (3) States that, upon written request, the licensee shall extend for an additional 10 days the redemption period or, if entitled to the conditional right of reinstatement, both the redemption and reinstatement periods. The licensee shall provide the proper form for applying for these extensions with the substance of the form being limited to the extension request, spaces for the requesting party to sign and date the form, and instructions that it must be personally served or sent by certified or registered mail, return receipt requested, to a person or office and address designated by the licensee and received before the expiration of the initial redemption and reinstatement periods. (4) Discloses the place at which the motor vehicle will be returned to the persons liable on the loan upon redemption or reinstatement. (5) Designates the name and address of the person or office to whom payment must be made. (6) States the licensee's intent to dispose of the motor vehicle upon the expiration of 15 days from the date of giving or mailing the notice, or if by mail and either the place of deposit in the mail or the place of address is outside the Virgin Islands, the period must be 20 days instead of 15 days, and further, that upon written request to extend the redemption period and any applicable reinstatement period for 10 days, the licensee shall, without further notice, extend the period accordingly. (7) Informs the persons liable on the loan that, upon written request, the licensee shall furnish a written accounting regarding the disposition of the motor vehicle as provided for in this subchapter. Advises them that the request must be personally served or sent by first-class mail, postage prepaid, or certified mail, return receipt requested, to a person or office and address designated by the licensee. (8) Includes a notice, in at least 10-point bold type if the notice is printed, reading as follows: "NOTICE: YOU MAY BE SUBJECT TO SUIT AND LIABILITY IF THE AMOUNT OBTAINED UPON DISPOSITION OF THE VEHICLE IS INSUFFICIENT TO PAY THE LOAN BALANCE AND ANY OTHER AMOUNTS DUE." (c) Unless automatically provided to the borrower within 45 days after the disposition of the motor vehicle, the licensee shall provide a written accounting regarding the disposition to any person liable on the loan within 45 days after their written request, if the request is made within one year after the disposition. The accounting must itemize: (1) The gross proceeds of the disposition. (2) The reasonable and necessary costs and fees authorized by this chapter incurred in repossessing the motor vehicle. (3) The satisfaction of indebtedness secured by any subordinate lien or encumbrance on the motor vehicle if written notification of demand therefor is received before distribution of the proceeds is completed. If requested by the licensee, the holder of a subordinate lien or encumbrance shall seasonably furnish reasonable proof of its interest, and unless it does so, the seller or holder need not comply with its demand. (d) In all sales that result in a surplus, the licensee shall furnish an accounting as provided in subsection (c) whether or not requested by the borrower. The surplus must be returned to the borrower no later than 45 days after the sale is conducted. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 430-431.

Amount Due (a) This section applies to a loan secured in whole or in part by a lien on a motor vehicle. (b) In the absence of default in the performance of any of the borrower's obligations under the loan, the licensee may not accelerate the maturity of any part or all of the amount due thereunder or repossess the motor vehicle. (c) If, after default by the borrower, the licensee repossesses or voluntarily accepts surrender of the motor vehicle, any person liable on the loan shall have a right to reinstate the loan and the licensee may not accelerate the maturity of any part or all of the loan prior to the expiration of the right to reinstate, unless the licensee reasonably and in good faith determines that: (1) The borrower or any other person liable on the loan by omission or commission intentionally provided false or misleading information of material importance on the credit application. (2) The borrower or any other person liable on the loan has concealed the motor vehicle or removed it from the territory in order to avoid repossession. (3) The borrower or any other person liable on the loan has committed or threatens to commit acts of destruction or has failed to take care of the motor vehicle in a reasonable manner, so that the motor vehicle has or may become substantially impaired in value. (d) Exercise of the right to reinstate the loan is limited to once in any 12-month period and twice during the term of the loan. (e) This subsection governs the method by which a loan is reinstated with respect to curing events of default which were grounds for repossession or that occurred subsequent to repossession: (1) If the default is the result of the borrower's failure to make any payment due under the loan, the borrower or any other person liable on the loan shall make the defaulted payments and pay any applicable delinquency charges. (2) If the default is the result of the borrower's failure to keep and maintain the motor vehicle free from all encumbrances and liens of every kind, the borrower or any person liable on the loan shall either satisfy all the encumbrances and liens or, if the licensee satisfies the encumbrances and liens, the borrower or any other person liable on the loan shall the licensee for all reasonable costs and expenses incurred therefor. (3) If the default is the result of the borrower's failure to keep and maintain insurance on the motor vehicle, the borrower or any other person liable on the loan shall either obtain the insurance or, if the licensee has obtained the insurance, the borrower or any other person liable on the loan shall reimburse the licensee for premiums paid and all reasonable costs and expenses incurred therefor. (4) If the default is the result of the borrower's failure to perform any other obligation under the loan, unless the licensee has made a good faith determination that the default is so substantial as to be incurable, the borrower or any other person liable on the loan shall reimburse the licensee for all reasonable costs and expenses incurred therefor. (5) Additionally, the borrower or any other person liable on the loan shall reimburse the licensee for actual and necessary fees in an amount not exceeding the amount specified in subsection (a), paragraph (3), subparagraph (F) of section 833 paid in connection with the repossession of a motor vehicle to a repossession agency, and actual fees. (f) If the licensee denies the right to reinstatement under subsection (c) or paragraph (4) of subsection (e), the licensee shall have the burden of proof that the denial was justified in that it was reasonable and made in good faith. If the licensee fails to sustain the burden of proof, the licensee is not entitled to a deficiency. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 432, 433.

A licensee, or the agent of a licensee, that has received a notice of agent, may not make a subsequent assignment to skip trace, locate, or repossess the vehicle without simultaneously, and in the same manner by which the assignment is given, advising the assignee of the assignment of the information contained in the notice. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 433.

No licensee may take a deed of trust, mortgage, or lien upon real property as security for any loan made under this chapter, except any lien as is created by law upon the recording of an abstract of judgment. This section does not apply to any loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 885. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 433.

No licensee may take any confession of judgment or any power of attorney, except a power of attorney taken to effectuate the transfer of the ownership of any motor vehicle or mobile home at the time of making the loan. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 433.

No licensee may take any note or promise to pay that does not accurately disclose the actual amount of the loan, the time for which it is made, and the agreed rate of charge or the annual percentage rate pursuant to Regulation Z promulgated by the Board of Governors of the Federal Reserve System. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 434.

No licensee may take any instrument in which blanks are left to be filled in after execution. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 434.

(a) No licensee may contract for a loan that provides for a scheduled repayment of principal over more than the maximum terms set forth in this section opposite the respective size of loans. Principal amount of loan Maximum term Less than $500 ........................ 24 months and 15 days $500 but less than $1,500 ........................ 36 months and 15 days $1,500 but less than $3,000 ........................ 48 months and 15 days $3,000 but less than $5,000 ........................ 60 months and 15 days (b) This section does not apply to open-end loans, or to a student loan made by an eligible lender under the Higher Education Act of 1965, as amended, 20 U.S.C.§1070 et seq., or to a student loan made pursuant to the Public Health Service Act, as amended 42 U.S.C. §294 et seq. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 434.

The payment by any person in money, credit, goods, or things in action as consideration for any sale or assignment of, or order for, the payment of wages, salary, commissions, or other compensation for services, whether earned or to be earned, is, for the purposes of regulation under this chapter, a loan secured by the assignment. The amount by which the assigned compensation exceeds the amount of the consideration actually paid is interest and charges upon or for the loan, calculated from the date of payment to the date the compensation is payable. This section may not be construed as modifying or affecting existing statutes governing wage assignments in the Territory, or as authorizing those assignments. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 434.

(a) This chapter does not prohibit any licensee from contracting for, collecting, or receiving the following: (1) The statutory fee paid by the licensee to any public officer for acknowledging, filing, recording, or releasing in any public office any instrument securing the loan or executed in connection with the loan. (2) Premiums paid by the licensee of the kind and to the extent described in paragraph (2) of subsection (e) of Section 226.4 of Regulation Z promulgated by the Board of Governors of the Federal Reserve System, 12 C.F.R. 226. (b) These amounts are not included in determining the maximum charges which may be made under this subchapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 434, 435.

(a) A finance lender shall deliver or cause to be delivered to the borrower, or any one thereof, at the time the loan is made, a statement showing in clear and distinct terms the name, address, and license number of the finance lender and the broker, if any. The statement must show the date, amount, and maturity of the loan contract, how and when repayable, the nature of the security for the loan, if any, and the agreed rate of charge or the annual percentage rate pursuant to Regulation Z promulgated by the Board of Governors of the Federal Reserve System 12 C.F.R. 226. (b) A finance lender shall obtain from the borrower a signed statement as to whether any person has performed any act as a broker in connection with the making of the loan. If the statement discloses that a broker or other person has participated, then the finance lender shall obtain a full statement of all sums paid or payable to the broker or other person. The finance lender shall keep these statements for a period of three years from and after the date the loan has been paid in full, or has matured according to its terms, or has been charged off. (c) A finance lender shall permit payment to be made in advance in any amount on any contract of loan at any time. The licensee may apply the payment first to any agreed prepayment penalty, then to all charges due, including charges at the agreed rate or rates up to the date of payment, not to exceed the applicable maximum rate permitted by this chapter. (d) A finance lender shall deliver or cause to be delivered to the person making any cash payment, or to the person who requests a receipt at the time of making any payment, at the time payment is made on account of any loan, a plain and complete receipt showing the total amount received and identifying the loan contract upon which the payment is applied. (e) Upon repayment of any loan in full, a finance lender shall release all security for the loan, endorse and return any certificate of ownership, and cancel or plainly mark "paid" and return to the borrower or person making final payment, any note, mortgage, security agreement, trust deed, assignment, or order signed by the borrower, or an optical image reproduction thereof, except those documents that are a part of the court record in any action, or that have been delivered to a third person for the purpose of carrying out their terms, or a security agreement that secures any other indebtedness of a borrower to the licensee, or original documents otherwise required by law. When a trust deed on real property has been taken as security for a loan that has been subsequently paid in full, a duly executed request for reconveyance must be delivered to the trustor or trustee for the purpose of recording a reconveyance. A termination statement, furnished to the borrower must be deemed a release of the security when a financing statement has been filed pursuant to the Uniform Commercial Code, 11A V.I.C. § 9-501 et seq. For purposes of this subsection, an optical image reproduction shall meet all of the following requirements: (1) The optical image storage media used to store the document must be nonerasable write once, read many (WORM) optical image media that does not allow changes to the stored document. (2) The optical image reproduction must be made consistent with the minimum standards of quality approved by either the National Institute of Standards and Technology or the Association for Information and Image Management. (3) Written authentication identifying the optical image reproduction as an exact unaltered copy of the note, trust deed, mortgage, security agreement, assignment or order must be stamped or printed on the optical image reproduction. (f) A finance lender shall deliver or cause to be delivered to the potential borrower, or any one thereof, at the time the licensee first requires or accepts any signed instrument or the payment of any fee, a statement showing in clear and distinct terms the name, address, and license number of the finance lender and the broker, if any. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 435, 436.

(a) A finance broker shall deliver to the borrower, or any one thereof, at the time the final negotiation or arrangement is made, a statement showing in clear and distinct terms the name, address, and license number of the broker and the finance lender. The statement must show the date, amount, and terms of the agreement with the broker, and all amounts paid or to be paid to the broker and to any person other than the finance lender. (b) A finance broker shall deliver to the finance lender making the loan a copy of the statement referred to and described in subsection (a). (c) A finance broker shall deliver to the person making any payment to the broker to be retained by the broker, a plain and complete receipt for each payment made, at the time it is made, showing the total amount received, and identifying the brokerage agreement and the loan contract upon which the payment is applied. If the payment is made by a person other than the finance lender, a copy of the receipt must be delivered to the finance lender. (d) When the borrower pays the loan in full, the finance lender shall ensure that the finance lender fully complies with subsection (e) of section 876. (e) A finance broker shall deliver to the potential borrower or borrowers, at the time the licensee first requires or accepts any signed instrument or the payment of any fee, a statement showing in clear and distinct terms the name, address, and license number of the broker and finance lender. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 436, 437.

Nothing contained in this chapter may be construed to deny to any licensee under this chapter the right of taking and using a security agreement that, in addition to securing an original obligation, may secure the repayment of sums that may be advanced to, or expenditures that may be made at the direction of, the borrower subsequent to the execution of the security agreement and prior to the satisfaction thereof. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 437.

(a) A licensee may sell promissory notes evidencing the obligation to repay loans made by the licensee pursuant to this chapter or evidencing the obligation to repay loans purchased from and made by another licensee pursuant to this chapter to institutional investors and may make agreements with institutional investors for the collection of payments or the performance of services with respect to those notes. (b) For the purpose of this section, "institutional investor" means the following: (1) The United States or any state, district, territory, or commonwealth of the United States or any city, county, city and county, public district, public authority, public corporation, public entity, or political subdivision of a state, district, territory, or commonwealth of the United States, or any agency or other instrumentality of any one or more of the foregoing. (2) A bank, trust company, savings bank or savings and loan association, federal credit union, industrial bank or industrial loan company, finance lender, residential mortgage lender, or insurance company doing business under the authority of and in accordance with a license, certificate, or charter issued by the United States or any state, district, territory, or commonwealth of the United States. (3) Trustees of pension, profit sharing, or welfare funds, if the pension, profit sharing, or welfare fund has a net worth of not less than $15,000,000, except pension, profit sharing, or welfare funds of a licensee or its affiliate, self-employed individual retirement plans, or individual retirement accounts. (4) A corporation with outstanding securities registered under Section 12 of the SeSection 12 of the Securities Exchange Act of 1934owned subsidiary of that corporation, if the purchaser represents that it is purchasing for its own account for investment and not with a view to, or for sale in connection with any distribution of the promissory note. (5) A syndication or other combination of any of the foregoing that is organized to purchase the promissory note. (6) A trust or other business entity established by an institutional investor for the purpose of issuing or facilitating the issuance of undivided interests in, the right to receive payments from, or that are payable primarily from, a pool of financial assets held by the trust or business entity if all of the following apply: (A) The business entity is not a sole proprietorship. (B) The pool of assets consists of one or more of the following: (i) Interest bearing obligations. (ii) Other contractual obligations representing the right to receive payments from the assets. (iii) Surety bonds, insurance policies, letters of credit, or other instruments providing credit enhancements for these assets. (C) The interests will be either of the following: (i) Rated investment grade by Standard & Poor's Corporation or Moody's Investors Service, Inc. "Investment grade" means that the securities will be rated by Standard & Poor's Corporation as AAA, AA, A, or BBB, or by Moody's Investor Service, Inc., as Aaa, Aa, A, or Baa, including a rating with a "+" or "-" designation or other variations that occur within these ratings. (ii) Sold to an institutional investor as otherwise defined in this section. (D) The offer and sale of the securities is qualified under the Corporate Securities Law of 1968 or is registered under federal securities laws or is exempt from qualification or registration. (c) In the absence of agreement to the contrary by the licensee and the institutional investor, all payments received from the collection of payments must be deposited and maintained in a trust account and must be disbursed from the trust account only in accordance with the instructions of the owner of the promissory note. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 437-439.

(a) A licensee that is a finance lender may sell to an institutional lender, or an institutional investor described in section 879(b)(6), promissory notes evidencing the obligation to repay federally related mortgage loans, as defined in 24 C.F.R. 3500.2 purchased from and made by an institutional lender and may make agreements for the collection of payments and performance of services with respect to those notes. For purposes of this section, "institutional lender" means any bank, trust company, savings bank or savings and loan association, federal credit union, industrial loan company or residential mortgage lender doing business under the authority of and in accordance with a license, certificate or charter issued by the United States or this Territory. (b) In the absence of agreement to the contrary by the licensee and the institutional investor or institutional lender, all payments received from the collection of payments must be deposited and maintained in a trust account and must be disbursed from the trust account only in accordance with the instructions of the owner of the promissory note. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 439.

(a) No licensee may make a loan to refinance a retail installment contract, that is held by the licensee, its subsidiaries, or affiliates, unless all of the following conditions are met: (1) The buyer has been making installment payments required by the retail installment contract for a period of not less than 90 days. The retail installment contract has a term of not less than 180 days and does not provide for any scheduled installment that is more than twice the amount of any other scheduled installment. (2) The loan provides for additional proceeds other than for insurance in an amount not less than the outstanding principal balance of the retail installment contract and provides for payment in full of the retail installment contract. (3) The licensee may not take a security interest in real property that is the principal residence of the borrower unless the loan has a principal amount of $5,000 or more and the following notice written in the same language, for example, Spanish, as used in the loan documents, is incorporated into the statement used to comply with section 877: "WARNING TO BORROWER: IF YOU ACCEPT THIS LOAN YOU WILL BE PUTTING UP YOUR HOME AS SECURITY. THIS MEANS THAT YOUR HOME COULD BE SOLD WITHOUT YOUR PERMISSION AND WITHOUT ANY COURT ACTION IF YOU MISS ANY PAYMENT AS REQUIRED BY THIS LOAN." This notice must be printed in not less than 14-point bold type, must be set apart from the rest of the statement by a border, and must appear directly above a signature block that must be signed by the borrower. A security interest described in this paragraph that is taken without prior notice and the borrower's signature, as required by this paragraph, is be void and unenforceable. (4) The licensee may not sell, attempt to sell, or agree to sell any goods or services to the borrower, other than credit insurance as defined in section 849 and insurance required by the licensee to protect its security interest, until the loan has been in effect for at least 30 days. The amount of insurance required by the licensee to protect its security interest must not exceed the lesser of the principal amount of the loan or the replacement value of the security as determined by the insurer. (5) A licensee that is an assignee of the retail installment contract shall continue to be subject under the loan to all equities and defenses of the borrower against the seller arising out of the sale, notwithstanding an agreement to the contrary. (6) The loan must not provide for any scheduled installment that is more than twice the amount of any other scheduled installment. This paragraph does not apply to a loan of a bona fide principal amount of $50,000 or more. (7) If a loan of a bona fide principal amount of $25,000 or more provides for any scheduled installment that is more than twice the amount of any other scheduled installment, the loan must contain the following provision: "The payment schedule contained in this loan requires that you make a balloon payment of $__________ (amount of balloon payment) which is a payment of more than double the amount of the regular payments. You have an absolute right to obtain a new payment schedule if you default in the payment of any balloon payment." (8) If the borrower defaults in the payment of any balloon payment, the borrower must be given an absolute right to obtain a new payment schedule. Unless agreed to by the borrower, the installment amounts under the new schedule may not be substantially greater than the average of the preceding installments. (b) A loan made pursuant to this section is subject to this chapter. (c) An action by any licensee or borrower on a loan made pursuant to this section must be tried in the judicial division in which the loan was signed by the borrower, in the judicial division in which the borrower resided at the time the loan was entered into, or in the judicial division in which the borrower resides at the commencement of the action. (d) Paragraphs (6) and (7) of subsection (a) do not apply to open-end loans. (e) A security interest provided by any retail installment contract serves as consideration in whole or in part for a loan made under this section. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 439-441.

(a) As used in this section: (1) "Instant loan check" or "live check" means any loan or extension of credit that is made available in the form of a check, draft, or any other negotiable instrument that can be deposited in a bank or used for third-party payments. (2) "Instant loan check" or "live check" does not include a check, draft, or any other negotiable instrument provided in response to an application for credit or as a means of access to an existing loan or extension of credit, including a home equity or personal line of credit. (b) No person may produce, advertise, offer, sell, distribute, or otherwise transfer for use in this Territory any live check unless the document bears the following phrase printed in 12-point type on the front of the document: "THIS IS A LOAN OR AN EXTENSION OF CREDIT. YOU WILL PAY CHARGES." (c) Live checks are negotiable for only a period of 30 days after the date printed on the live check. Printed material accompanying the live check must advise the consumer to void and destroy the live check if it is not going to be negotiated. (d) Loan solicitations must be mailed in envelopes with no indication that a negotiable instrument is contained in the mailing. Envelopes must be marked with "do not forward" instructions to the postal service if the intended addressee is no longer at the location. (e) Any loan solicitation made through a live check must be honored in the full amount by the issuer unless the account on which the solicitation is made is closed by the consumer before the date the check is cashed. (f) If a live check is stolen or incorrectly received by someone other than the intended payee, and the live check is cashed or otherwise negotiated based upon fraud or misrepresentation by someone other than the intended payee, the following safeguards for the consumer apply: (1) The creditor, upon receipt of notification that the consumer did not negotiate the live check and is a victim of identity theft, shall provide, and the consumer may complete, a statement confirming that the consumer did not deposit, cash, or otherwise negotiate the live check. (2) Upon completion of the confirmation statement by the consumer, the consumer who was the intended payee has no liability for the loan obligation, absent any fraud by that consumer. (3) Upon receipt of notification that the consumer did not negotiate the live check and is a victim of identity theft, the creditor shall take appropriate actions. (g) The Board may, after appropriate notice and opportunity for hearing, by order levy administrative penalties against a licensee who violates this section, and the licensee is liable for administrative penalties of no more than $10,000 for each willful violation. Any hearing must be held in accordance with this chapter and the regulations to be promulgated pursuant to this chapter, and the Board has all the powers granted under this chapter. The remedy available under this subsection is in addition to any other remedies available to the Board under this chapter that may be employed to enforce the provisions of this section. (h) Nothing in this section precludes the application of any section or regulation under this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 441, 442.

2007 (a) Any person who violates any provision of Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007, (Public Law 109-364), or any provision of Section 232 of Title 32 of the Code of Federal Regulations, as published on August 31, 2007, in Volume 72 of the Federal Register, violates this chapter. (b) With respect to any consumer loans covered by Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007, (Public Law 109-364), or by Section 232 of Title 32 of the Code of Federal Regulations, as published on August 31, 2007, in Volume 72 of the Federal Register, a person that does not market consumer loans to, or does not extend those loans to, covered borrowers, as that term is defined under Section 232 of Title 32 of the Code of Federal Regulations, as published on August 31, 2007, in Volume 72 of the Federal Register, is not in violation of Section 394 of the Military and Veterans Code. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 442.

and $50,000 Or More (a) The following sections do not apply to any loan of a bona fide principal amount of $50,000 or more, or to a duly licensed finance lender in connection with the loan or loans, if the provisions of this section are not used for the purpose of evading: sections 794, 795, 842, 848, 849, 850, and 889, and the sections enumerated in subsection (b). (b) The following sections do not apply to any loan of a bona fide principal amount of 5,000 or more, or to a duly licensed finance lender in connection with the loan or loans, if the provisions of this section are not used for the purpose of evading: sections 833, 835, 840, 841, 842(a), and sections 844, 858, 860, 861, 863, 864, 865, 873, 880 and 909. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 443.

Any section that refers to this section does not apply to any loan of the bona fide principal amount specified in that section, or more, if that provision is not used for the purpose of evading this chapter. In determining under §§ 884, 838, or 839 or any section that refers to this section whether a loan is a loan of a bona fide principal amount of the amount specified in that section or more and whether the regulatory ceiling provision of that section is used for the purpose of evading this chapter, the following principles apply: (a) If a borrower applies for a loan in a bona fide principal amount of less than the specified amount and a loan to that borrower of a bona fide principal amount of the specified amount or more if made by a licensed finance lender, no adequate economic reason for the increase in the size of the loan exists, and by prearrangement or understanding between the borrower and the licensee a substantial payment is to be made upon the loan with the effect of reducing the bona fide principal amount of the loan to less than the specified amount within a short time after the making of the loan other than by reason of a requirement that the loan be paid in substantially equal periodical installments, then the loan may not be deemed to be a loan of the bona fide principal amount of the specified amount or more, and the regulatory ceiling provisions must be deemed used for the purpose of evading this chapter unless the loan complies with the other provisions of the section that includes the regulatory ceiling provisions. (b) If a loan made by a licensed finance lender is in a bona fide principal amount of the specified amount or more, the fact that the transaction is in the form of a sale of accounts, chattel paper, goods, or instruments or a lease of goods, or in the form of an advance on the purchase price of any of the foregoing, may not be deemed to affect the loan or the bona fides of the amount thereof or to indicate that the regulatory ceiling provisions are used for the purpose of evading this chapter. (c) For the purposes of determining whether the loan amount exceeds a regulatory ceiling, the "bona fide principal amount" must not be comprised of any charges or any other fees or recompense specified in section 833, including, but not limited to, amounts paid for insurance of the types specified in sections 848 and 849, 833, 840, 851, 852, 856, 857, 858 and 875. Nothing in this subsection may be construed to prevent those specified charges, fees, and recompense that have been earned and remain unpaid in an existing loan from being considered as part of the bona fide principal amount of a new loan to refinance that existing loan, if the new loan is not made for the purpose of circumventing a regulatory ceiling provision. This subsection is intended to define the meaning of "bona fide principal amount" as used in this chapter solely for the purposes of determining whether the loan amount exceeds a regulatory ceiling and is not intended to affect the meaning of "principal" for any other purpose. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 443, 444.

This subchapter applies only to loan contracts payable in substantially equal and consecutive monthly installments of principal and charges combined, the first of which is due not less than 15 days nor more than one month and 15 days from the date the loan is made. Instead of computing charges and applying payments as provided in section 842, a licensee may precompute charges and apply payments as follows: (a) The total charges that would be earned if the contract were repaid exactly according to its terms, at the monthly rate stated in the contract, may be precomputed when the loan is made and added to the principal of the loan. For the purpose of computation, a month is that period of time from any date in one month to the corresponding date in the next month, and if there is no corresponding date, then to the last day of the next month. The principal amount of the loan is its face value as referred to in section 844. Every payment may be applied to the combined total of principal and precomputed charges until the contract is fully paid. The acceptance of payment of charges on loans made under this chapter may not be deemed to constitute payment deduction or receipt thereof in advance nor compounding under section 844. Precomputed charges are subject to the following adjustments: (1) The portion of the precomputed charge applicable to any particular monthly installment period must bear the same ratio to the total precomputed charge, excluding any adjustment made for a first period of more than one month, as the balance scheduled to be outstanding during that monthly period bears to the sum of all monthly balances scheduled originally by the loan contract. (2) If the loan contract is paid in full by cash, a new loan, refinancing, or otherwise, the borrower shall receive a rebate of that portion of the precomputed charge that is the difference between the total precomputed charge and the charges at the contract rate computed in accordance with section 842 or 843. The tender, by the borrower or at the borrower's request, of an amount equal to the unpaid balance, less the required rebate, must be accepted by the licensee in full payment of the contract. (3) If three or more, but not all, installments are prepaid in full at any one time, all of the prior charges for the loan must be recalculated and all subsequent charges for the remaining term of the loan must be recalculated by applying each payment first to charges and the remainder to principal in accordance with section 842 or 843. (4) If the payment date of all wholly unpaid installments on which no default charge has been collected is deferred one or more full months and the contract so provides, the licensee may charge and collect a deferment charge. The deferment charge may not exceed the portion of the precomputed charge applicable prior to deferment, to the first deferred monthly installment period multiplied by the number of months the maturity of the contract is deferred. The number of months may not exceed the number of full installments that are in default on the date of deferment or that may become due within 15 days of that date. When a deferment charge is made, no portion of the precomputed charge applies to the installment periods in which no installment payment is required by reason of the deferment. In computing any default charge or required rebate, the portion of the precomputed charge applicable to each deferred balance and installment period following the deferment period and before the deferred maturity must remain the same as that applicable to the balances and periods under the original loan contract. The charge may be collected at the time of deferment or at any time thereafter. Any payment received at the time of deferment may be applied first to the deferment charge and the remainder, if any, applied to the unpaid balance of the contract. However, if the payment is sufficient to pay, in addition to the appropriate deferment charge, any installment that is in default and the applicable default charge, it must be first so applied, and any the installment may not be deferred nor subject to the deferment charge. (5) In the event of default of more than 10 days in the payment of one-half or more of any scheduled installment, the licensee may charge and collect a default charge not exceeding an amount equal to the portion of the precomputed charge applicable to the final installment period. The charge may not be collected more than once for the same default and may be collected at the time of the default or at any time thereafter. If the default charge is deducted from any payment received after default occurs, and the deduction results in the default of a subsequent installment, no charge may be made for the resulting default. (6) A borrower and licensee may agree that the first installment due date may be not more than 15 days more than one month and the amount of the installment may be increased by one-thirtieth of the portion of the precomputed charge applicable to a first installment of one month for each extra day. (b) The statement to be given to the borrower as provided in subsection (a) of section 876 and the contract must disclose in addition to other required information the principal amount of the loan exclusive of charges and the basis for computing the refund of precomputed charges in case of prepayment in full or acceleration of maturity and for computing default and deferment charges. The delivery of a receipt of each payment showing the total amount of each payment complies with subsection (d) of section 876. (c) If the maturity of the contract when the charges are precomputed is accelerated for any reason, the licensee shall make the same refund or credit as would be required if the contract was paid in full on the date of acceleration. The unpaid balance must be treated as the unpaid principal balance, and thereafter the unpaid balance of the contract must bear charges at the agreed rate of charge if the loan contract so provides. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 444-446.

With respect to precomputed loans, licensees are subject to comply only with, and derive authority only from sections 886 and 888, notwithstanding any other provision of law that is not within this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 446.

When charges on a loan of an original bona fide principal amount of $5,000 or more have been precomputed in a manner similar to that provided in section 886, and the loan is prepaid in full by cash, a new loan, refinancing, or otherwise, or the maturity of the loan contract is accelerated for any reason, the borrower shall receive a rebate or credit of that portion of the precomputed charge that is the difference between the total precomputed charge and the charges at the contract rate computed in accordance section 842 or section 843, or on the basis of 12 equal months of 30 days each, on the assumption that all payments were received by the licensee on their respective due dates. This section does not apply to charges paid by the borrower to the lender or others, such as charges computed as a percentage of the loan, that are fully earned upon making the loan, or to charges agreed to be paid by the borrower upon prepayment of a loan secured by a lien upon real property. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 446.

As used in this subchapter, "open-end credit program" means a licensee's plan for making open-end loans pursuant to a loan agreement that sets forth the terms and conditions governing the use of the open-end credit program, expressly stating that the loan is made pursuant to this subchapter, and provides that: (a) The borrower may use the open-end credit program to obtain money, goods, labor, or services on credit. The licensee makes open-end loans to the borrower for the purpose of paying money to or at the direction of the borrower or paying obligations that the borrower creates through use of the open-end credit program. (b) The amount of each advance and the charges and other permitted costs are debited to an account. (c) The charges are computed from time to time on the unpaid balances of the borrower's account, excluding from the computation any unpaid charges other than permitted fees, costs, and expenses. (d) The borrower has the privilege of paying the account in full at any time. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 447.

If an open-end credit program is not primarily for the purpose of purchasing or leasing goods or services from the licensee, then all credit extended through use of the program, including transactions that involve the purchase or lease of goods or services from the licensee, are subject to this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 447.

(a) Subject to the written approval of the Board of the licensee's plan of business for making open-end loans as not being misleading or deceptive and subject to regulations the Board may adopt with respect to open-end loans under section 992, a licensee may make open-end loans pursuant to this subchapter and may contract for and receive thereon charges as set forth in sections 838, 839, and 843. These charges may be calculated on an amount not exceeding the greater of: (1) The actual daily unpaid balances of the open-end account in the billing cycle for which the charge is made, in which case one-thirtieth of the monthly rate may be charged for each day the unpaid balance is outstanding. (2) The average daily unpaid balance of the open-end account in the billing cycle for which the charge is made, which is the sum of the amount unpaid each day during that cycle divided by the number of days in that cycle. The amount unpaid on a day is determined by adding to any balance unpaid as of the beginning of that day all advances and other debits and deducting all payments and other credits made or received as of that day. The billing cycle must be monthly. A billing cycle is monthly if the closing date of the cycle is the same date each month or does not vary by more than four days from the regular date. (b) This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 447, 448.

(a) The minimum monthly payment is determined by any of the following: (1) The amount calculated by multiplying the unpaid principal balance, after an advance and including the advance, by a percent agreed upon by the borrower and the licensee, which may not be less than 2 1/2 percent. The minimum payment must continue at the amount determined pursuant to this paragraph until a subsequent loan advance is made. (2) The amount calculated by multiplying the unpaid balance at the end of each billing cycle by a percent agreed upon by the borrower and the licensee, which may not be less than 5 percent. (3) Any other bona fide amount agreed upon by the borrower and the licensee which may be sufficient to pay all charges and some principal, originally scheduled to be due by the borrower as of each scheduled due date. (b) This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 448.

On open-end loans, the licensee may contract for and receive the fees, costs, and expenses permitted on other loans, including those permitted by subsection (a) paragraphs (1), (2), (3), and (4) of section 848 and subsection (d) of section 849, except that the charge for credit insurance under section 849 must be on a monthly basis and must be actuarially consistent with the premium rate for the same coverage. This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 448.

(a) In lieu of subsections (b), (c), (d), (e), and (f) of section 849, with respect to open-end loans, a licensee may provide credit insurance with the borrower's consent, in a form to be approved by the Board, in an amount not in excess of the amount of the indebtedness. For credit life or disability insurance, the licensee may collect from the borrower any amount established by the Virgin Islands Insurance Code or regulations. (b) If life insurance is provided, and if the insured borrower dies during the term of the loan contract, the insurance must be sufficient to pay the total amount due on the loan outstanding on the date of borrower's death, without any exception, reservation, or limitation. (c) If disability insurance is provided, and if the insured borrower becomes disabled during the term of the loan contract, the insurance must be sufficient to pay all amounts attributable to the loan balance at the time of commencement of disability that subsequently become due on the loan thereafter during the period of disability, in accordance with subsection (d) of section 850, without any exception, reservation, or limitation. (d) If loss-of-income insurance is provided, and if the insured borrower becomes unemployed during the term of the loan contract, the insurance must be sufficient to pay all amounts attributable to the loan balance at the time of commencement of unemployment in accordance with subsection (d) of section 859 without any exception, reservation, or limitation. (e) Any credit insurance that is provided must be in force as soon as the loan is made, or coverage is agreed upon, whichever is later. No credit insurance written in connection with an open-end loan may be canceled by the lender because of delinquency of the borrower in the making of the minimum payments thereon unless one or more of the payments is past due for a period of 90 days or more, and the lender shall advance to the insurer the amounts required to keep the insurance in force during that period, which amounts may be debited to the borrower's account. (f) This section does not apply to any open-end loan of a bona fide principal amount $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 448, 449.

Section 844 applies to open-end loans with the following variations: (a) Section 844 applies to open-end loans with the following variations:To comply with section 844, in the case of open-end loan advances directly to the borrower, the licensee shall deliver to the borrower, at the time of each loan advance, an amount equal to the face value of the advance. (b) To comply with section 844, in the case of an open-end loan advance in the form of a payment by the licensee to a person from whom a borrower obtained money, goods, labor, or services, the licensee shall deliver to that person the amounts necessary to fulfill the borrower's obligation to that person under the transaction. (c) This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 449, 450.

Instead of the requirements of section 871, the open-end loan agreement must contain the name, address, and license number of the finance lender and must disclose the nature of the security taken, the method of determining the minimum payments that will be required to repay the initial advance and any subsequent advances on the loan, and the agreed rate of charge. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 450.

Instead of the requirements of section 876(a), with respect to open-end loans, except in the case of an account that the licensee considers uncollectible, or for which delinquency collection procedures have been instituted, the licensee shall deliver or cause to be delivered to the borrower, or any one thereof, for each billing cycle at the end of which there is an outstanding balance in the account, or to which a finance charge is imposed, a statement setting forth the outstanding balance in the account at the beginning of the billing cycle, the date and amount of any subsequent loan advance during the period, the amounts and dates of crediting to the account during the billing cycle that payments are credited, the amount of any finance charge debited to the account during the billing cycle, the annual percentage rate of finance charge determined under Regulation Z promulgated by the Board of Governors of the Federal Reserve System 12 C.F.R. 226, the balance on which the finance charge was computed, the closing date of the billing cycle, the outstanding balance on that date, and the minimum monthly payment required in the absence of any additional advance. If there is any change in the nature of the security for the loan since the next preceding advance, the statement must contain or be accompanied by a statement of the nature of the security for the loan after that change. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 450.

Subsection (e) of section 876 does not apply to an open-end loan that has no balance outstanding if the open-end loan agreement continues in effect. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 450.

Section 872 does not apply to a change in terms of an open-end loan if notice is given to the borrower in accordance with 12 C.F.R.226.9(c). History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 450.

Sections 791(a), 794, 863, and 876(b) do not apply to a licensee with respect to advances made through an open-end credit program. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 450.

The payment of fees for participation in an open-end credit program, the acceptance by a borrower of the form of the licensee's program, and the borrower's agreement to the licensee's program may not be deemed a collateral sale, purchase, or agreement within the terms of sections 833, 846, or 847. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451.

(a) Nothing in this subchapter limits the authority of the Board to disapprove advertising with respect to open-end loans pursuant to section 804. (b) This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451.

The subchapter does not apply to loans other than open-end loans. This section does not apply to any open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451.

Section 886 does not apply to open-end loans. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451.

An open-end loan is in compliance with section 869, if it is an open-end loan of a bona fide principal amount of $5,000 or more as determined in accordance with section 906. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451.

(a) Any section that refers to this section or that is subject to section 885 does not apply to any open-end loan of the bona fide principal amount specified in the regulatory ceiling provision of that section or more, or to a licensed finance lender in connection with the loan if that provision is not used for the purpose of evading this chapter. (b) In determining whether an open-end loan is an open-end loan of a bona fide principal amount specified in any section in this subchapter or more and whether the regulatory ceiling provision of that section is used for the purpose of evading this chapter, the open-end loan must be deemed to be for that amount or more if both the following criteria are met: (1) The line of credit is equal to or more than the bona fide principal amount of the specified amount. (2) The initial advance was equal to or more than the bona fide principal amount of the specified amount. (c) A subsequent advance of money of less than the specified amount pursuant to the open-end loan agreement between a borrower and a licensed finance lender must be deemed to be a loan of a bona fide principal amount of the specified amount if the criteria of paragraphs (1) and (2) of subsection (b) have been met, even though the actual unpaid balance after the advance or at any other time is less than the bona fide principal amount of the specified amount. (d) Notwithstanding subsections (b) and (c), the amount of the line of credit of an unsecured open-end loan is the criterion to determine whether an unsecured open-end loan is of a bona fide principal amount or more specified in any section in this chapter. (e) For the purposes of determining whether the loan amount exceeds a regulatory ceiling, section 885(c) applies to open-end loans. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 451, 452.

(a) (1) Upon the request of a person who has obtained a police report to initiate an identity theft investigation, a finance lender engaged in the business of making consumer loans shall provide to the person, or to a law enforcement officer specified by the person, copies of all application forms or application information containing the person's name, address, or other identifying information pertaining to the application filed with the finance lender by an unauthorized person. (2) Before providing copies pursuant to paragraph paragraph (1)nce lender shall inform the requesting person of the categories of identifying information that the unauthorized person used to complete the application and shall require the requesting person to provide identifying information in those categories and a copy of the police report. (3) The finance lender shall provide copies of all forms and information required by this section, without charge, no later than 10 business days after receipt of the person's request and submission of the required copy of the police report and identifying information. (b) Before a finance lender provides copies to a law enforcement officer pursuant to paragraph (1) of subsection (a), the finance lender may require the requesting person to provide them with a signed and dated statement by which the person does all of the following: (1) Authorizes disclosure for a stated period. (2) Specifies the name of the agency or department to which the disclosure is authorized. (3) Identifies the type of records that the person authorizes to be disclosed. (c) The finance lender shall include in the statement to be signed by the requesting person a notice that the person has the right at any time to revoke the authorization. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 452, 453.

(a) If any amount other than, or in excess of, the charges permitted by this chapter is willfully charged, contracted for, or received, the contract of loan is void, and no person has any right to collect or receive any principal, charges, or recompense in connection with the transaction. (b) If any provision of this chapter is willfully violated in the making or collection of a loan, whether by a licensee or by an unlicensed person subject to this chapter, the contract of loan is void, and no person has any right to collect or receive any principal, charges, or recompense in connection with the transaction. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 453.

(a) If any amount other than or in excess of the charges permitted by this chapter is charged or contracted for, or received, for any reason other than a willful act of the licensee, the licensee shall forfeit all interest and charges on the loan and may collect or receive only the principal amount of the loan. (b) Subsection (a) does not apply to an error in computation if: (1) the licensee shows by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error, and (2) no later than 15 days after discovering the error the licensee notifies the borrower of the error and makes whatever adjustments in the account are necessary to correct the error. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 453.

Loan (a) If any provision of this chapter is violated in the making or collection of a loan, for any reason other than a willful act of the licensee, the licensee shall forfeit all interest and charges on the loan and may collect or receive only the principal amount of the loan. (b) Subsection (a) does not apply to a violation if (1) the licensee shows by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error, and (2) no later than 15 days after discovering the error the licensee notifies the borrower of the error and rectifies the error by making the appropriate changes in the documents or account and by taking other action necessary to correct the error. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 453, 454.

Any person who willfully violates any provision of this chapter or who willfully violates any regulation or order adopted pursuant to this chapter, must upon conviction, be punished by a fine of not more than $10,000 or by imprisonment for not more than one year, or by both. However, no person may be imprisoned for the violation of any regulation or order unless the person had knowledge of the regulation or order. Conviction, under this section, does not preclude the Board from exercising the authority in section 827. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 454.

No provision imposing liability under this chapter, including the provisions of sections 909(a) and 910(a), apply to any act done or omitted in good faith in conformity with any written general rule, regulation, or specific ruling of the Board, notwithstanding that after the act or omission has occurred, the written general rule, regulation, or specific ruling is amended, rescinded, or determined by judicial or other authority to be invalid for any reason. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 454.

A finance lender or broker licensed under this chapter may not pay any commission, fee, or other compensation to an unlicensed individual for conducting activities that require a license, unless that unlicensed individual is exempt from licensure pursuant to this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 454.

(a) "Charges" include the aggregate interest, fees, bonuses, commissions, brokerage, discounts, expenses, and other forms of costs charged, contracted for, or received by a licensee or any other person in connection with the investigating, arranging, negotiating, procuring, guaranteeing, making, servicing, collecting, and enforcing of a loan or forbearance of money, credit, goods, or things in action, or any other service rendered. (b) "Charges" do not include commissions received as a licensed insurance agent or broker. (c) "Commercial loan" means a loan of a principal amount $5,000 or more, or any loan under an open-end credit program, whether secured by either real or personal property, or both, or unsecured, the proceeds of which are intended by the borrower for use primarily for other than personal, family, or household purposes. For purposes of determining whether a loan is a commercial loan, the lender may rely on any written statement of intended purposes signed by the borrower. The statement may be a separate statement signed by the borrower or may be contained in a loan application or other document signed by the borrower. The lender is not required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 454, 455.

Sections 792, 794, 795, 802, and 803 do not apply to any commercial loan of a bona fide principal amount of $5,000 or more, or to a duly licensed finance lender in connection with any loan or loans, if the provisions of this section are not used for the purpose of evading this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 455.

In determining whether a loan is a loan of a bona fide principal amount of the specified amount or more, the following principles apply: (a) If a borrower applies for a loan in a bona fide principal amount of less than the specified amount and a loan to that borrower of a bona fide principal amount of the specified amount or more is made by a licensed Finance lender, no adequate economic reason for the increase in the size of the loan exists, and by prearrangement or understanding between the borrower and the licensee a substantial payment is to be made upon the loan with the effect of reducing the bona fide principal amount of the loan to less than the specified amount within a short time after the making of the loan other than by reason of a requirement that the loan be paid in substantially equal periodical installments, then the loan may not be deemed to be a loan of the bona fide principal amount of the specified amount or more. (b) A subsequent advance of money of less than a bona fide principal amount of the specified amount pursuant to a revolving or open-end loan agreement or similar agreement between a borrower and a licensed finance lender which gives the borrower the right to draw upon all or any part of the line of credit, or a loan agreement providing for the making of advances to the borrower from time to time up to an aggregate maximum amount which gives the borrower the right to draw all or any part of the total amount, must be considered a loan of a bona fide principal amount of the specified amount or more if the line of credit or the aggregate maximum amount is a bona fide principal amount of the specified amount or more and the initial advance was a bona fide principal amount of the specified amount or more even though the actual unpaid balance after the advance or at any other time is less than a bona fide principal amount of the specified amount. (c) If a loan made by a licensed finance lender has a bona fide principal amount of the specified amount or more, the fact that the transaction is in the form of a sale of accounts, chattel paper, goods, or instruments, or a lease of goods, or in the form of an advance on the purchase price of any of the foregoing, may not be considered to affect the bona fides of the amount thereof. (d) For the purposes of this section, "the specified amount" means $5,000. (e) For the purposes of determining whether the loan amount exceeds a regulatory ceiling, the "bona fide principal amount" may not be comprised of any charges or any other fees or recompense specified in sections 889 and 919. Nothing in this subsection may be construed to prevent those specified charges, fees, and recompense that have been earned and remain unpaid in an existing loan from being considered as part of the bona fide principal amount of a new loan to refinance that existing loan, provided the new loan is not made for the purpose of circumventing a regulatory ceiling provision. This subsection is intended to define the meaning of "bona fide principal amount" as used in this chapter solely for the purposes of determining whether the loan amount exceeds a regulatory ceiling and is not intended to affect the meaning of "principal" for any other purpose. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 455, 456.

(a) A licensee may sell promissory notes evidencing the obligation to repay loans made by the licensee pursuant to this subchapter or evidencing the obligation to repay loans purchased from and made by another licensee pursuant to this subchapter to institutional investors and may make agreements with institutional investors for the collection of payments or the performance of services with respect to those notes. (b) For the purposes of this section, "institutional investor" means the following: (1) The United States or any state, district, territory, or commonwealth thereof, or any city, county, city and county, public district, public authority, public corporation, public entity, or political subdivision of a state, district, territory, or commonwealth of the United States, or any agency or other instrumentality of any one or more of the foregoing. (2) Any bank, trust company, savings bank or savings and loan association, federal credit union, industrial bank or industrial loan company, finance lender, or insurance company doing business under the authority of and in accordance with a license, certificate, or charter issued by the United States or any state, district, territory, or commonwealth of the United States. (3) Trustees of pension, profit sharing, or welfare funds, if the pension, profit sharing, or welfare fund has a net worth of not less than $15,000,000, except pension, profit sharing, or welfare funds of a licensee or its affiliate, self-employed individual retirement plans, or individual retirement accounts. (4) Any corporation with outstanding securities registered under Section 12 of the Securities Exchange Securities Exchange Act of 1934 subsidiary of that corporation; provided, that the purchaser represents that it is purchasing for its own account for investment and not with a view to or for sale in connection with any distribution of the promissory note. (5) Any syndication or other combination of any of the foregoing that is organized to purchase the promissory note. (6) A trust or other business entity established by an institutional investor for the purpose of issuing or facilitating the issuance of undivided interests in, the right to receive payments from, or that are payable primarily from, a pool of Financial assets held by the trust or business entity if all of the following apply: (A) The business entity is not a sole proprietorship. (B) The pool of assets consists of one or more of the following: (i) Interest bearing obligations. (ii) Other contractual obligations representing the right to receive payments from the assets. (iii) Surety bonds, insurance policies, letters of credit, or other instruments providing credit enhancements for these assets. (C) The interests will be either of the following: (i) Rated investment grade by Standard & Poor's Corporation or Moody's Investors Service, Inc. "Investment grade" means that the securities will be rated by Standard & Poor's Corporation as AAA, AA, A, or BBB, or by Moody's Investor Service, Inc., as Aaa, Aa, A, or Baa, including a rating with a "+" or "-" designation or other variations that occur within these ratings. (ii) Sold to an institutional investor as otherwise defined in this section. (D) The offer and sale of the securities is qualified under the Uniform Securities Act, chapter 23, section 60 et seq. of this title, or is registered under federal securities laws, or is exempt from qualification or registration. (c) In the absence of agreement to the contrary by the licensee and the institutional investor, all payments received from the collection of payments must be deposited and maintained in a trust account and must be disbursed from the trust account only in accordance with the instructions of the owner of the promissory note. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 456, 457.

(a) A licensee that is a finance lender may sell to an institutional lender, or an institutional investor described in section 917(b)(6), promissory notes evidencing the obligation to repay real estate secured business purpose loans, as defined in Section 24 CFR 3500.5, purchased from and made by an institutional lender, and may make agreements for the collection of payments and performance of services with respect to those notes. For purposes of this section, "institutional lender" means any bank, trust company, savings bank or savings and loan association, federal credit union, or industrial loan company doing business under the authority of and in accordance with a license, certificate or charter issued by the United States or a state or territory of the United States. (b) In the absence of agreement to the contrary by the licensee and the institutional investor or institutional lender, all payments received from the collection of payments must be deposited and maintained in a trust account and must be disbursed from the trust account only in accordance with the instructions of the owner of the promissory note. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 458.

With respect to a loan under this chapter, a fee not to exceed $40 for the return by a depository institution of a dishonored check, negotiable order of withdrawal, or share draft may be charged and collected by the licensee. The fee is not included in charges as defined in this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 458.

As used in this chapter, "open-end credit program" means a licensee's plan for making open-end loans pursuant to a loan agreement that sets forth the terms and conditions governing the use of the open-end credit program, expressly stating that the loan is made pursuant to this subchapter, and provides that: (a) The borrower may use the open-end credit program to obtain money, goods, labor, or services or credit, and the licensee makes open-end loans to the borrower for the purpose of paying money to, or at the direction of, the borrower or paying obligations that the borrower creates through use of the open-end credit program. (b) The amount of each advance and the charges and other permitted costs are debited to an account. (c) The charges are computed from time to time on the unpaid balances of the borrower's account excluding from the computation any unpaid charges other than permitted fees, costs, and expenses. (d) The borrower has the privilege of paying the account in full at any time. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 458.

Any person who willfully violates any provision of this chapter relating to commercial loans, or who willfully violates any regulation or order adopted under this chapter relating to commercial loans, shall, upon conviction, be punished by a fine of not more than $10,000, by imprisonment not more than one year, or by both fine and imprisonment. However, no person may be imprisoned for the violation of any regulation or order unless the person had knowledge of the regulation or order. Conviction under this section does not preclude the Board from exercising the authority provided in section 827. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 459.

The Board may promulgate regulations and specific rulings, demands, and findings for the enforcement of this chapter, in addition to, and within the general purposes of, this chapter. History: Added Jan. 17, 2019, No. 8168, § 1, Sess. L. 2018, p. 459.