On June 20, the governor of Texas signed into law HB 3805, expanding the Texas Department of Banking’s (TDB) enforcement powers over money services businesses. As stated in the state’s bill analysis, the TDB previously had the authority to prohibit or remove individuals from participating in a company’s affairs it regulates; however, this authority did not extend to money services businesses. The act amends the law to enable TDB to prohibit or remove current individuals from participation in money services businesses if the TDB commissioner determines that such action is warranted.
If the commissioner has grounds for action and finds that a removal or prohibition order is necessary and in the public interest, the commissioner may serve a proposed order on the individual alleged to have committed or participated in the conduct. The bill also establishes procedures for immediate removal or prohibition in response to certain criminal convictions and allows individuals subject to such orders to apply for release from a removal or prohibition order after 10 years. The act goes into effect September 1.
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