Relating to the regulation of money services businesses.

Contracts

• Employment Agreements: Amend executive contracts to require immediate disclosure of any civil litigation involving fraud, fiduciary breach, or mismanagement. This protects the company’s license if a "Key Individual" becomes a liability.
• Custodial Agreements: If holding stablecoins as permissible investments, review contracts with third-party custodians. You must ensure they meet the forthcoming Commissioner-approved qualifications.
• M&A Purchase Agreements: For acquisitions of existing licensees, draft agreements to include an attestation that the buyer will not make "material changes" to the business plan. This triggers a streamlined regulatory approval process (Section 152.152).

Hiring/Training

• Background Check Protocols: Update HR workflows immediately. Standard criminal background checks are no longer sufficient. You must now procure independent credit reports and litigation history for all "Key Individuals" (formerly principals).
• Role Definitions: Re-evaluate organizational charts. The shift from "Principal" to "Key Individual" may expand the scope of vetted employees to include regional compliance officers or managers with significant control over funds.

Reporting & Record-Keeping

• Currency Exchange Accounting: Licensees must transition from tax-basis or cash-basis accounting to United States Generally Accepted Accounting Principles (GAAP).
• Key Individual Dossiers: Maintain a specific compliance file for every Key Individual containing their fingerprints, credit report, and litigation history attestation for DOB examination.
• Stablecoin Reserves: If using stablecoins for permissible investments, document proof of "direct" custody or a valid contract with a qualified third-party custodian.

Fees & Costs

• Audit Fees: Currency Exchange licensees not currently using GAAP will face significant one-time and recurring costs to convert financial systems and engage external auditors.
• Vetting Costs: Incremental increase in recruitment costs due to mandated credit reporting and deeper investigatory requirements.