Colorado Expands Its Money Transfer Laws | Orrick, Herrington & Sutcliffe LLP

On June 3, Colorado passed HB 1328 (the “Act”), which will extend the state’s regulations on money transmitters through September 2030. The Act was previously scheduled to go into effect on September 1. The bill would implement the recommendations of the Department of Regulatory Agencies as set forth in the Department’s review of the expiration of regulations relating to money transmitters. Specifically, the bill would (i) authorize the State Banking Board to suspend a money transmitter’s license and issue cease-and-desist orders; (ii) extend the guarantee requirement to cover any transfer of funds rather than any exchange; (iii) increase the maximum penalty for failure to test from $100 to $1,000 per day for continued refusal and for failure to report to $750 per day; and (iv) extending the license exemption to out-of-state banks. The Act will enter into force 90 days after the adjournment of the General Meeting, provided that no referendum motion is submitted.