SB 86 — An Act relating to the business of money transmission; relating to licenses for money transmission, licensure requirements, and registration through a nationwide multistate licensing system; relating to the use of virtual currency for money transmission; relating to authorized delegates of a licensee; relating to acquisition of control of a license; relating to record retention and reporting requirements; authorizing the Department of Commerce, Community, and Economic Development to cooperate with other states in the regulation of money transmission; relating to permissible investments; relating to violations and enforcement of money transmission laws; relating to exemptions to money transmission licensure requirements; relating to payroll processing services; relating to currency exchange licenses; relating to abandoned virtual currency; amending Rules 79 and 82, Alaska Rules of Civil Procedure; and providing for an effective date.

-7- Enrolled SB 86 (b) Before establishing a relationship with a person, a licensee shall disclose, to the extent applicable to the virtual currency business activity the licensee will undertake with the person, (1) a schedule of fees and charges the licensee may assess, the manner by which fees and charges will be calculated if not set in advance and disclosed, and the timing of the fees and charges;

SB 86 -8- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (B) the person's responsibility to provide notice to the licensee of a virtual currency transfer or virtual currency exchange;

(D) general error resolution rights applicable to a virtual Enrolled SB 86 -8- currency transfer or virtual currency exchange;

and (9) that virtual currency is not money, that other persons are not required to take payment in virtual currency, that the value of virtual currency can change, and that virtual currency is not backed by a governmental agency.

(c) Except as provided in (d) of this section, at the conclusion of a virtual currency transaction with or on behalf of a person, a licensee shall provide to the person a confirmation in a record that contains (1) the name and contact information of the licensee, including information the person may need to ask a question or file a complaint;

and (3) the fee charged for the transaction, including any charge for SB0086A -9- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I conversion of virtual currency to money, bank credit, or another virtual currency.

-9- Enrolled SB 86 Sec.

and (4) considered a permissible investment to the extent specified under thisAS chapter.06.55.502(b)(4).

(c) For five years after the date of virtual currency business activity with or on behalf of a person, a licensee shall maintain a record of (1) each transaction of the licensee with or on behalf of the person or for the licensee's account in this state, including SB 86 -10- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (A) the identity of the person;

and (D)Enrolled theSB account86 number,-10- name,(D) andtheaccountnumber, mailingname,and addressmailingaddressoftheperson of the person, and, to the extent feasible, other parties to the transaction;

(2) the aggregate number of transactions and aggregate value of transactions by the licenseelicenseewith withoronbehalf oroftheperson on behalf of the person and for thethelicensee's licensee's account in this state, expressed in the dollar equivalent of virtual currency for the previous 12 calendar months;

(4) aageneral generalledgerposted ledger posted at least monthly thatthatlists lists all saassets, ets, liabilities, capital, income, and expenses of the licensee;

(a) The provisions of AS 06.55.150 - 06.55.165 do not apply to aactivity virtualby currency(1) exchange, a virtualperson currencythat transfer,contributes virtualonly currencyconnectivity storage,software or computing power to a decentralized virtual currency administrationor to thea extentprotocol thegoverning activityvirtual iscurrency governedtransfer byof 15the U.S.C.digital representation of value;

1693(2) -a 1693rperson (Electronicthat Fundprovides Transferonly Actdata ofstorage 1978),or 15security U.S.C.services for a business engaged in virtual currency business activity and does not otherwise engage in virtual currency business activity on behalf of another person;

78a(3) -a 78qqperson (Securitiesthat Exchangeprovides Actonly ofto 1934),another 7person U.S.C.otherwise exempt from this chapter virtual currency as one or more enterprise solutions used solely between -11- Enrolled SB 86 each other and has no agreement or relationship with a person that is an end user of virtual currency;

1 - 27f (Commodity Exchange Act), or AS 45.56.100 - 45.56.995 (Alaska Securities Act).

SB0086A -11- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (b) The provisions of AS 06.55.150 - 06.55.165 do not apply to activity by (1) a person that contributes only connectivity software or computing power to a decentralized virtual currency or to a protocol governing virtual currency transfer of the digital representation of value;

(2) a person that provides only data storage or security seies for a business engaged in virtual currency business activity and does not otherwise engage in virtual currency business activity on behalf of another person;

(3) a person that provides only to another person otherwise exempt from this chapter virtual currency as one or more enterprise s otions used solely between each other and has no agreement or relationship with a person that is an end user of virtual currency;

SB 86 -12- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (9) a secured creditor under AS 45.29 or creditor with a judicial lien or lien arising by operation of law on collateral that is virtual currency, if the virtual currency business activity of the creditor is limited to enforcement of the security interest in compliance with AS 45.29 or the law applicable to the lien;

or (C) engaging in testing products or services with the person's Enrolled SB 86 -12- own funds.

(c)(b) The department may determine, based on facts particular to the person or class of persons, that a person or class of persons is exempt from this chapter.

SB0086A -13- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (3) requirerequiretheauthorized the authorized delegate totoagreeto agree to comply with all applicable state and federal laws, rules, and regulations pertaining to money transmission, including this chapter and regulations implementing this chapter, relevant provisions of the Bank Secrecy Act, and P.L.

(6) require the authorized delegate to prepare and maintain records as -13- Enrolled SB 86 required by this chapter or regulations implementing this chapter, or as reasonably requested by the department;

If an authorized delegate commingles any funds received from money transmission with any other funds or property owned or controlled by the authorized delegate, all commingled funds and other property shall be considered held itrustin trust in favor of the SB 86 -14- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I licensee in an amount equal to the amount of money net of fees received from money transmission.

(f) InInthissection,"remit"meanstomakedirectpaymentsofmoney thistoalicensee 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 account specified by the licensee.

A person may not engage in the business of money transmission on behalf of a person that is not licensed or exempt [ACT AS AN AUTHORIZED DELEGATE FOR, OR OTHERWISE PROVIDE MONEY SERVICES ON BEHALF OF, A PERSON WHO DOES NOT HOLD A Enrolled SB 86 -14- MONEY SERVICES LICENSE] under this chapter.

106-102 (Gramm-Leach-(Gramm-Leach-Bliley Bliley Act), and P.L.

(3) accept the examination report of another agency of this state, another state, or the federal government,government or a report prepared by an independent accounting firm;

and SB0086A -15- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (4) summon and examine under oath a key individual or employee of a licensee or authorized delegate and require the key individual or employee to produce records regarding any matter related to the condition and business of the licensee or authorized delegate.

(b) A licensee or authorized delegate shall provide, and the department shall have complete access to, all records thenecessary departmentfor reasonablythe requiresdepartment to conduct a complete examination.

The department may use multistate record production standards and examination procedures when the multistate record production standards and examination procedures will reasonably achieve the -15- Enrolled SB 86 requirements of this section.

(c) Unless otherwise directed by the department, a licensee shall pay all costs reasonably incurred in connection with an examination of athe licensee or athe licensee's authorized delegate.

(b) A licensee shall submit a report of the licensee's authorized delegates SB 86 -16- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I within 45 days after the end of each quarter of the calendar yyear. ae.

(7) a trade name or other name used by the individual that inis sotnot the Enrolled SB 86 -16- individual's legal name;

(8) contact personpersonname, name,telephonenumber,and telephone number, and electronic mail address;

SB0086A -17- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (3) the commencement of a proceeding to revoke or suspend its [MONEY SERVICES] license in a state or country in which the [MONEY SERVICES] licensee engages in business or is licensed;

-17- Enrolled SB 86 * Sec.

(a) A personperson, or group of persons acting in concertconcert, seeking to acquire control of a licensee shall obtain the written approval of the department before acquiring control.

An individual is not considered totoacquirecontrolofalicenseewhen acquiretheindividualbecomes controlakeyindividual of a licensee when the individual becomes a key individual in the ordinary course of business.

(d) When an application forforacquisitionofcontrol acquisitionappearstoincludeall of control appears to include all required information and to address all matters required by the department, the application is considered complete, and the department shall notify the applicant in a SB 86 -18- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I record of the date on which the department determines the application is complete.

and (2) the personperson, or group of persons acting in concertconcert, is not prohibited from acquiring control.

Enrolled SB 86 -18- (g) When an application is filed and considered to be complete under (d) of this section, thethedepartment department shall investigateinvestigatethe the financial condition, financial responsibility, financial experience, business experience, competence level, character, and general fitness of the personperson, or group of persons acting in concertconcert, seeking to acquire control.

and (2) the financial condition, financial responsibility, financial experience, business experience, competence level, character, and general fitness of the person, or group of persons acting in concert, seeking to acquire control, and the experience, competence level, character, and general fitness of the key individuals and persons that would be in control of the licensee after the acquisition of controlcontrol, indicate that it is in the public interest to permit the person, or group of persons acting in concert, to control the licensee.

(h) If an applicant for approval to acquire control is subject to a multistate licensing process, the department may SB0086A -19- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (1) accept the investigation results of a lead investigative state for the purposes of (g) of this section;

(i) The department shall issue a formal written notice of a ndenial dieal of an application for approval to acquire control within 30 days after the decision to deny the application.

-19- Enrolled SB 86 (3) a person that acquires control of a licensee as a personal representative, custodian, guardian, conservator, or trustee, or as an officer appointed by a court of competent jurisdiction or by operation of law;

(4) a person that is exempt under AS 06.55.802(4);06.55.802(a)(4);

(l) Before filing an application for approval to acquire control of a licensee, a person may request in writing a determination from the department as to whether the person would be considered a person in control of a licensee upon consummation of a SBproposedtransaction. 86 -20- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I proposed transaction.

IfIfthedepartmentdetermines thethatthepersonwouldnot departmentbeaperson determines that the person would not be a person in control of a licensee, the proposed person and transaction are not subject to the requirements of (a) and (b) of this section.

(m) If a multistate licensing process includes a determination made under (l) of thisthissectionandanapplicantissubjecttothemultistatelicensingprocess,thedepartment section and an applicant is subject to the multistate licensing process, the department may (1) accept the control determination of a lead investigative state;

(n) The requirements of (a) and (b) of this section do not apply to a person that has complied with and received approval to engage in money transmission under this chapter or whothat has identified as a person in control in a previous application filed with and approved by thethedepartment departmentorbyan or by an accredited statestateinaccordancewith inamultistate accordancelicensing withprocess, aif multistateEnrolled licensingSB process,86 if-20- (1) in the previous five years, the person has not had a license revoked or suspended or controlled a licensee that has had a license revoked or suspended while the person was in control of the licensee;

(3) the licensee to be acquired is projected to meet the requirements of this chapter, including AS 06.55.501, 06.55.505, and 06.55.51006.55.510, after the acquisition of control is completed,completed andand, if the person acquiring control is a licensee, the licensee is also projected to meet the requirements of this chapter, including AS 06.55.501, 06.55.505, and 06.55.510, after the acquisition of control is completed;

(4) the licensee to be acquired will not implement any material changes to the licensee's business plan as a result of the acquisition of control,control andand, if the person acquiringacquiringcontrol controlisalicensee,thelicenseealsowillnotimplementanymaterialchanges is a licensee, the licensee also will not implement any material changes to the licensee's business plan as a result of the acquisition of control;

and (5) the person provides notice of the acquisition in cooperation with SB0086A -21- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I the licensee and attests to (1) - (4) of this subsection in a form and in a medium prescribed by the department.

To be a passive investor, a person -21- Enrolled SB 86 (1) may not have the power to elect a majority of key individuals or executive officers, managers, directors, trustees, or other persons exercising managerial authority of a person in control of a licensee;

and (4) shall attest to (1) - (3) of this subsection on a form and in a medium prescribed by the department,department or commit to the requirements of (1) - (3) of this subsection in a written document.

SB 86 -22- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (2) a general ledger posted at least monthly containing all asset, liability, capital, income, and expense accounts;

(d) AllRecords records[ALL RECORDS] maintained by the [MONEY SERVICES] licensee as required in (a) - (c) of this section are open to inspection by the repentdepartment only as permitted under AS 06.55.401.

Enrolled SB 86 -22- * Sec.

(a) Except as [OTHERWISE] provided in (b) of this section, all information or reports obtained by the department from an applicant, [A] licensee, or [AN] authorized delegate, all information contained in or related to an examination, investigation, operating report, or condition report prepared by, on behalf of, or for the use of the department, and financial statements, balance sheets, or authorized delegate information,information are confidential and not subject to disclosure under AS 40.25.100 - 40.25.295 [, INCLUDING SB0086A -23- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (1) ALL INFORMATION CONTAINED IN OR RELATED TO EXAMINATION, INVESTIGATION, OPERATING, OR CONDITION REPORTS PREPARED BY, ON BEHALF OF, OR FOR THE USE OF THE DEPARTMENT;

-23- Enrolled SB 86 (c) This section does not prohibit the department from disclosing to the public a list of [MONEY SERVICES] licensees or the aggregated financial or transactional data concerning those [MONEY SERVICES] licensees.

(f) Information contained in the records of the department that is not SB 86 -24- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I confidential and may, upon request, be made available to the public on the department's Internet website includes (1) the name, business address, telephone number, and unique registry identifier of a licensee;

(4) thethetermsoracopyofanybondfiledby termsalicensee,ifthat or a copy of any bond filed by a licensee, if that confidential information, including the prices and fees for the bond, is redacted;

(a) A licensee shall, within 90 days after the end of the licensee's fiscal year or within anyextendedany extended period that the Enrolled SB 86 -24- department establishes, file with the department (1) an audited financial statement of the licensee for the fiscal year prepared in accordance with generally accepted accounting principles;

(b) TheTheauditedfinancialstatementmustbepreparedbyanindependentcertified audited financial statements must be prepared by an independent certified public accountant or independent public accountant who is satisfactory to the department.

(c) The audited financial statementsstatement must include a certificate of opinion of the independent certified public accountant or independent public accountant that is satisfactory in form and content to the department.

(a) To carry out the purposes of this chapter, subject to AS 06.55.407, the department may (1) enter into an agreement or relationship with a government official SB0086A -25- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I or federal or state regulatory agency or regulatory association to improve efficiency and reduce regulatory burden by standardizing methods or procedures,procedures and sharing resources, records, or related information obtained under this chapter;

(b) The department has broad administrative authority to administer, interpretinterpret, and enforce this chapter, to adopt regulations implementing this chapter, and to recover the cost of administering and enforcing this chapter by imposing and collecting proportionate and equitable fees and costs associated with applications, examinations, -25- Enrolled SB 86 investigations, and other actions required to achieve the purposes of this chapter.

and (2) enterenterinto intowrittencontracts writtenoragreements contracts or agreements with otherotherstateand state and federal regulators for the purposes of cooperating, coordinating, and sharing information with state and federal regulators.

(b) Nothing in this section constitutes a waiver of the department's authority to conduct an examination or investigation or otherwise take independent action to SB 86 -26- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I enforce compliance with applicable state or federal law.

(b) If there is an inconsistency between this chapter and a federal law that governs in accordance with (a) of this section, the department may provide interpretive guidance that (1) identifies the inconsistency;

and Enrolled SB 86 -26- (2) provide the information required under AS 06.55.109 within 45 days after the effective date of the key individual's appointment.

(b) The department may issue a notice of disapproval of a key individual if the department finds thatthat, based on the experience, competence level, character, or integrity of the individualindividual, it would not be in the best interest of the public or the customers of the licensee to permit the individual to be a key individual.

SB0086A -27- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (e) If a multistate licensing process includes a key individual notice review and disapproval process, and the licensee is subject to the multistate licensing process, the department may (1) accept the key individual notice review determination of another state;

(b) Except for permissible investments listed in AS 06.55.502(a), the [THE] department, with respect to any licensee [MONEY SERVICES LICENSEES], may by -27- Enrolled SB 86 regulation or order limit the extent to which a specific [TYPE OF] investment maintained by a licensee within a class of permissible investments may be considered a permissible investment [, EXCEPT FOR MONEY AND CERTIFICATES OF DEPOSIT ISSUED BY A BANK.

(c) Permissible investments, even if commingled with other assets of the [MONEY SERVICES] licensee, are held in trust for the benefit oftheof the purchasers and holders of the [MONEY SERVICES] licensee's outstanding money transmission [PAYMENT INSTRUMENTS AND STORED VALUE] obligations in the event of the licensee's insolvency, bankruptcy, [OR] receivership, or commencement of other judicial or administrative proceedings for its dissolution or reorganization, or in SB 86 -28- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I the event of an action by a creditor against the licensee whothat is not a beneficiary of the statutory trust.

A permissible investment impressed with a trust in accordance with this subsection isisnotsubjectto not subject to attachment, levylevyofexecution, oforsequestration execution, or sequestration by a court, unless the attachment, levy of execution, or sequestration is for a beneficiary of the statutory trust [OF THE MONEY SERVICES LICENSEE].

A statutory trust established under this section shall be terminated upon extinguishment of all of the licensee's outstanding Enrolled SB 86 -28- money transmission obligations.

(1) cash, demand deposits, savings deposits, funds in accounts held for the benefit of a licensee's customers in a federally insured depository financial institution, money market mutual funds rated AAA by an eligible rating service, SB0086A -29- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I certificates [A CERTIFICATE] of deposit, [OR A] senior deotbligationsdebt obligations [OBLIGATION] of a federally [AN] insured depository financial institution, and cash equivalents, including automated clearing house items in transit to the licensee and automated clearing house items or international wires in transit to a payee, cash in transit by armored car, cash in smart safes, cash in licensee-owned locations, and transmissiontransmissionreceivablesowedbyabankandfundedbyadebitcardorcreditcard; receivables owed by a bank and funded by a debit card or credit card;

(3) [(4) AN INVESTMENT SECURITY THAT IS] an obligation of the United States or a commission [DEPARTMENT], agency, or instrumentality of the United States, [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 -29- Enrolled SB 86 a state or a governmental subdivision, agency, or instrumentality of a state;

(5) 100 percent of the surety bond provided for under AS 06.55.505 that exceeds the average daily money transmission liability in this state [(5) RECEIVABLES THAT ARE PAYABLE TO A MONEY SERVICES LICENSEE FROM ITS AUTHORIZED DELEGATES, IN THE ORDINARY COURSE OF BUSINESS, UNDER CONTRACTS THAT ARE NOT PAST DUE OR DOUBTFUL OF COLLECTION IF THE AGGREGATE AMOUNT OF RECEIVABLES UNDER THIS PARAGRAPH DOES NOT EXCEED 20 SB 86 -30- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I PERCENT OF THE TOTAL PERMISSIBLE INVESTMENTS OF A MONEY SERVICES LICENSEE AND THE MONEY SERVICES LICENSEE DOES NOT HOLD AT ONE TIME RECEIVABLES UNDER THIS PARAGRAPH IN ANY ONE PERSON AGGREGATING MORE THAN 10 PERCENT OF THE MONEY SERVICES LICENSEE'S TOTAL PERMISSIBLE INVESTMENTS;

(1) receivables that are payable to a licensee from the licensee's authorized delegates in the ordinary course of business that are less than seven days old and do not exceed 50 percent of the aggregate value of the licensee's total permissible investments;receivables underthisparagraphthatarepayabletoalicenseefromasingle authorized delegate in the ordinary course of business may not exceed 10 percent of the aggregate value of the licensee's total permissible investments;

receivablesEnrolled underSB this86 paragraph-30- that(2) arethefollowinginvestments,nottoexceed20percentforeach payablecategory toand a licenseecombined fromtotal a single authorized delegate in the ordinary course of business50 may not exceed 10 percent of the aggregate value of the licensee's total permissible investments;investments:

(2) the following investments, not to exceed 20 percent for each category and a combined total of 50 percent of the aggregate value of the licensee's total permissible investments:

(D) United States tri-party repurchase agreements collateralized at 100 percent or more by federal government or agency securities, municipal SB0086A -31- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I bonds, or other securities bearing an eligible rating;

and (3) cash held in accounts for the benefit of the licensee's customers at foreign depository financial institutions, not to exceed 10 percent of the aggregate value of the licensee's total permissible investments, if the licensee has received a satisfactory rating in the licensee's most recent examination and the foreign depository financial institution (A) has an eligible rating;

1471-14741471 - 1474 (Foreign Account Tax Compliance Act);

(C) is not located in any country subject to sanctions from the UnitedUnitedStates States Department ofoftheTreasury, theOfficeofForeign Treasury Office of Foreign Assets Control;

and (D) is not located in a high-risk or noncooperative jurisdiction as designated by the Financial Action Task Force.Force;

and (4) virtual currency is a permissible investment only for outstanding money transmission obligations of virtual currency.

(a) The letter of credit permitted under -31- Enrolled SB 86 AS 06.55.502(a)(4) (1) must list the department as the beneficiary;

(3) must be issued by a federally insured depository financial institution orora a foreign bank thatthatbearsan bearseligiblerating an eligible rating and is regulated, supervised, and examined by federal or state regulatory authorities having regulatory authority over banks, credit unions, and trust companies;

(4) must be irrevocable, unconditional, and indicate that the letter of SB 86 -32- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I credit is not subject to any condition or qualifications outside of the letter of credit;

(5) may not contain reference to any other agreements, documentsdocuments, or entities,entities or otherwise provide for any security interest in the licensee;

(6) must contain an issue date and expiration date,date and expressly provide for automatic extension, without a written amendment, for an additional period of one year from the present or each future expiration date, unless the issuer of the letter of credit notifies the department in writing by certified or registered mail, courier mail, or other means of notice that provides a receipt, at least 60 days before an expiration date, that the irrevocable letter of credit will not be extended;

and (7) must provide that the issuer of the letter of credit will honor, at sight, a presentation made by the beneficiary to the issuer oftheof the following documents on or before the expiration date of the letter of credit:

Section 101 - 112 (Bankruptcy Code),Code) for bankruptcy or reorganization;

(ii) the filing of a petition by or against the licensee for receivership, or the commencement of any other judicial or administrative proceeding for the licensee's dissolution or Enrolled SB 86 -32- reorganization;

SB0086A -33- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (b) In the event of any notice of expiration or non-extension of a letter of credit issued under (a) of this section, the licensee shall be required to demonstrate to the satisfaction of the department, 15 days before expiration, that the licensee maintains and willwillmaintainpermissibleinvestmentsinaccordancewithAS maintain06.55.501uponexpiration permissible investments in accordance with AS 06.55.501 upon expiration of the letter of credit.

The department's agent may serve as agent for multiple licensing authorities for a single irrevocable letter of credit if the proceeds of the drawabledrawableamount amountforthepurposesofAS for06.55.502(a)(4)areassigned thetothedepartment. purposes of AS 06.55.502(a)(4) are assigned to the department.

(a) An applicant for a license shall provide, and a licensee at all times shall maintain, security consisting of a surety bond in a form -33- Enrolled SB 86 satisfactory to the department or, with the department's approval, a deposit in accordance with this section.

(c) A licensee that maintains aabond bond in the maximum amount provided for under (b) of this section is not required to calculate its average daily money SB 86 -34- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I transmission liability in this state for purposes of this section.

The department maymaypermit permitalicenseetosubstituteanotherform aofsecurity licenseeacceptableto tothedepartment substitute another form of security acceptable to the department for the security effective at the time the licensee stops providing money transmission in this state.

(b) Tangible net worth must be demonstrated at initial application by the Enrolled SB 86 -34- applicant's most recent audited or unaudited financial statements.

(a) The department maymaysuspendorrevokea suspend[MONEYSERVICES] or revoke a [MONEY SERVICES] license, placeplacea[MONEY a [MONEY SERVICES] licensee in receivership, or order a [MONEY SERVICES] SB0086A -35- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I licensee to revoke the designation of an authorized delegate if (1) the [MONEY SERVICES] licensee violates this chapter or a regulation adopted or an order issued under this chapter;

-35- Enrolled SB 86 (b) In determining whether a [MONEY SERVICES] licensee is engaging in an unsafe or unsound practice, the department may consider the size and condition of the [MONEY SERVICES] 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.

(c) A licensee may apply for relief from a suspension or revocation of the SB 86 -36- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I licensee's license according to procedures prescribed by the department.

(4) thetheauthorized authorized delegate is convicted ofofaviolation aofastateorfederal violation of a state or federal anti-money laundering statute;

(c) An authorized delegate may apply for relief from a suspension or revocation Enrolled SB 86 -36- of designation as an authorized delegate according to procedures prescribed by the department.

(a) IfIfthe the department determines that aaviolation violation of this chapterchapterorof oraregulation of a regulation adopted or an order issued under this chapter by a [MONEY SERVICES] SB0086A -37- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I licensee or authorized delegate is likely to cause immediate and irreparable harm to the [MONEY SERVICES] licensee, its customers, or the public as a result of the violation, or cause insolvency or significant dissipation of assets of the [MONEY SERVICES] licensee, the department may issue an order requiring the [MONEY SERVICES] licensee or authorized delegate to cease and desist from the violation.

(b) TheThedepartmentmayissueanorderagainsta[MONEYSERVICES]licensee department may issue an order against a [MONEY SERVICE S] licensee to cease and desist from providing money transmission [SERVICES] through an authorized delegate who is the subject of a separate order by the department.

The department may assess a civil penalty against a person that [WHO] violates this chapter or a regulation adopted or an order issued under this chapter in an amount not to exceed $1,000$10,000 a [EACH][$1,000 EACH] day for each day the violation is outstanding,outstanding. plus the department's costs and expenses for the investigation and prosecution of the matter, including reasonable attorney fees.

AS 06.55.606(b)06.55.605 is amended by adding a new subsection to read:

(b) A person whothat knowinglyis engagesfound inliable an activity for which a [MONEYcivil SERVICES]penalty licenseunder is(a) requiredof under this chaptersection withoutshall beingalso licensedbe [ASliable Ato MONEYthe SERVICESdepartment LICENSEE]for andthe whodepartment's receivescosts moreand thanexpenses $500for ininvestigating compensationand withinprosecuting athe 30-daymatter, periodincluding fromreasonable thisattorney activityfees. is guilty of a class C felony.

AS 06.55.606(c)06.55.606(b) is amended to read:

(c)-37- Enrolled SB 86 (b) A person who knowingly engages in an activity for which a [MONEY SB 86 -38- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I SERVICES] license is required under this chapter without being [LICENSEDlicensed AS][AS aA [MONEYMONEY SERVICES]SERVICES licenseeLICENSEE] and who receives not [NO] more than $500 in compensation within a 30-day period from this activity is guilty of a class AC misdemeanor.felony.

AS 06.55.606(c) is amended to read:

(c) A person who knowingly engages in an activity for which a [MONEY SERVICES] license is required under this chapter without being [LICENSED AS] a [MONEY SERVICES] licensee and who receives not [NO] more than $500 in compensation within a 30-day period from this activity is guilty of a class A misdemeanor.

* Sec.

41.

41.42.

(e) AApersonthat[WHO]isservedwithanordertoceaseanddesistforviolating person that [WHO] is served with an order to cease and desist for violating AS 06.55.101 [OR 06.55.201] may petition the superior court for a judicial order setting aside, limiting, or suspending the enforcement, operation, or effectiveness of the order pending the completion of an administrative proceeding under AS 06.55.701 and 06.55.702.

42.43.

43.44.

This chapter does not apply to Enrolled SB 86 -38- (1) the United States or a department, [AN] agency, [OR AN] instrumentality, or agent of the United States;

SB0086A -39- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (4) a federally insured depository financial institution, a bank, aabank bank holding company, an office of an international banking corporation, a branch of a foreign bank, a corporation organized under 12 U.S.C.

611 - 633 (Edge Act) under the laws of a state or the United States, an institution regulated by the Farm Credit Association,Administration, or a subsidiary or affiliate of a financial institution if the subsidiary or affiliate is owned and controlled by a depository institution and regulated by a federal banking agency;

(5) electronicelectronicfundstransferofgovernmental funds transfer of governmental benefits forforafederal, a federal, state, or municipal agency or a state political subdivision by a contractor on behalf of (A) the United States or a pdepartment, dertment, an agency, or an instrumentality of the United States;

(6) a board of trade or a person that [WHO], in the ordinary course of business, provides clearance and settlement services for a board of trade, to the extent -39- Enrolled SB 86 of the operation of the person for a board of trade;

SB 86 -40- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (8) aapersonthat[WHO]providesclearanceorsettlementservicesunder person that [WHO] provides clearance or settlement services under a registration as a clearing agency or an exemption from the registration granted under the federal securities laws, to the extent of the person's operation as a provider of clearance or settlement services under a registration as a clearing agency or an exemption from the registration granted under the federal securities laws;

(9) an operator of a payment system to the extent that the retoroperator provides processing, clearing, or settlement services, between or among persons exempted [EXCLUDED] by this section, in connection with wire transfers, credit card transactions,transactions,debitcardtransactions,stored-valuetransactions,automatedclearinghouse debit card transactions, stored-value transactions, automated clearinghouse 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 the person's operation as a securities broker-broker-dealer; dealer;

(12) a person expressly appointed as a third-party service provider to or agent of an entity exempt under (4) of this section,subsection, solely to the extent that (A) the service provider or agent is engaging in money transmission on behalf of and in accordance with a written agreement with the exempt entity that sets out the specific functions that the service provider or agent is to perform;

and (B) the exempt entity assumes all risk of loss and all legal responsibilityresponsibilityforsatisfyingtheoutstandingmoneytransmission for satisfying the outstanding money transmission obligations owed to purchasers and holders of the outstanding money transmission Enrolled SB 86 -40- obligations upon receiving the purchaser's or holder's money or monetary value by the service provider or agent;

(13) a person appointed as an agent of a payee to collect and process a payment from a payor to the payee for goods or services, other than SB0086A -41- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I money transmission services, provided to the payor by the payee, if (A) the payee and the agent have a written agreement directing the agent to collect and process payments from payors on the payee's behalf;

-41- Enrolled SB 86 (16) an attorney, to the extent that the attorney is lawfully authorized to practice law in this state and engages in money transmission as an SB 86 -42- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I ancillary service to the practice of law;

or (17) a person exempt by regulation or order of the department if the department finds that the exemption is in the public interest and that the regulation of the person is not necessary for the purposes of this chapter;chapter [UNDER FEDERAL OR STATE SECURITIES LAWS].

(18) a person providing payroll processing services;

in this paragraph, (A) "payroll processing services" means receiving money for transmission under a contract with a person to deliver wages or salaries, make payment of payroll taxes to state and federal agencies, make payments relating to employee benefit plans, or make distributions of other authorized deductions from wages or salaries;

(B) "receiving money for transmission" means receiving money or monetary value in the United States for transmission within or outside the United States by electronic or other means [UNDER FEDERAL OR STATE SECURITIES LAWS].

44.45.

AS 06.55.802 is amended by adding a new subsection to read:

(b) The department may adopt regulations that exempt a person providing payroll processing services from all or some of the provisions of this chapter when the volume of the money transmissions received by the person are minor compared to the volume of money transmissions generally received by a person licensed under this chapter.

In this subsection, (1) "money transmission" means receiving money or monetary value in the United States for transmission within or outside the United States;

(2) "payroll processing services" means money transmissions received under a contract with a person for the purpose of delivering wages or salaries, making payments of payroll taxes to state and federal agencies, making payments relating to employee benefit plans, or making distributions of other authorized deductions from wages or salaries.

* Sec.

46.

45.47.

and (2) has not designated an authorized delegate to provide money Enrolled SB 86 -42- transmission [SERVICES] on behalf of the [MONEY SERVICES] licensee at the location.

(b) An authorized delegate shall provide customers with notice of how to SB0086A -43- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I file a complaint.

(c) The notice [SIGN] required by (a) or (b) of this sectionmustsection must be in a format and contain information required by the department [SHALL BE DISPLAYED AT ALL TIMES IN FULL VIEW OF PERSONS VISITING THE LOCATION AND SHALL GIVE THE DEPARTMENT'S ADDRESS AND THE DEPARTMENT'S TELEPHONE NUMBER FOR RECEIVING CALLS REGARDING COMPLAINTS AND OTHER CONCERNS ABOUT MONEY SERVICES LICENSEES, AUTHORIZED DELEGATES, AND THE MONEY SERVICES PROVIDED BY MONEY SERVICES LICENSEES AND AUTHORIZED DELEGATES].

46.48.

47.49.

For a transaction requested electronically or by telephone, the provider of money transmission may determine whether the person requesting the transaction is in this state by relying on other information provided by the person regarding the location of the person's residential address or principal place of business or other physical address,address and any records associated with the person that the provider of money transmission may have that indicate the location, including an address associated with an account.

48.50.

(a) Except as provided in (d)(c) of this section, a licensee -43- Enrolled SB 86 or a licensee's authorized delegate shall provide to the sender a receipt for money received for transmission.

The receipt must be in English and in any other SB 86 -44- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I language principally used by the licensee or authorized delegate to advertise, solicit, or negotiate, either orally or in writing, for the transaction conducted.

or (5) a stored-value transaction exempted by the department by regulation Enrolled SB 86 -44- or order.

(d) In this section, "receipt" means a paper receipt, electronic record, or other SB0086A -45- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I written confirmation.

49.51.

(b) If a licensee fails to forward money received for transmission in accordance with this section, the licensee mustshall respond to inquiries by the sender with the reason for the failure unless providing a response would violate a state or federal law, rule, or regulation.

50.52.

(a) Except as provided in (b) of this section, a licensee shall refund to the sender, within 10 days after receipt of the sender's written request for a refund, all money received for transmission unless (1) thethemoneyhas money has been forwarded within 1010days daysafterthe afterdateon the date on which the money was received for transmission;

or (5) the refund request does not -45- Enrolled SB 86 (A) identify the sender's name and (i) address;

or SB 86 -46- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (ii) telephone number;

51.53.

(b) The department shall establish fee levels under (s(a) of this section so that the total amount of fees collected for [BOTH MONEY TRANSMISSION] licenses [AND CURRENCY EXCHANGE LICENSES] under this chapter approximately equals the department's actual total regulatory costs for [BOTH MONEY TRANSMISSION] licenses [AND[ANDCURRENCY CURRENCY EXCHANGE LICENSES.

THETHEDEPARTMENT DEPARTMENT SHALL SET THE FEE LEVELS SO THAT THE FEE LEVELS FOR BOTH MONEY TRANSMISSION LICENSES AND CURRENCY EXCHANGE LICENSES ARE THE SAME].

52.54.

53.55.

54.56.

(3) "control" means (A) the ownership of, or the power to vote, directly or indirectly, at least 10 [25] percent of the outstanding [A CLASS OF] voting shares Enrolled SB 86 -46- [SECURITIES] or voting interests of a [MONEY SERVICES] licensee or of a person that owns or has the power to vote, directly or indirectly, at SB0086A -47- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I least 10 percent of the voting shares or voting interests [IN CONTROL] of a [MONEY SERVICES] licensee unless the person with the power to vote is a passive investor as described in AS 06.55.404(q);

(B) the power to elect or appoint a majority of executive officers, managers, directors, trustees, or other persons exercising managerial authorityauthorityofa[MONEYSERVICES]licenseeorpersonincontrolofa[MONEY of a [MONEY SERVICES] licensee or person in control of a [MONEY SERVICES] licensee;

or (C) the power to exerciseexercise, directly or indirectly, a controlling influence over the management or policies of a [MONEY SERVICES] licensee or person in control of a [MONEY SERVICES] licensee;

55.57.

56.58.

-47- Enrolled SB 86 * Sec.

57.59.

SB 86 -48- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (20) "person" means an individual, general partnership, limited partnership, [A] corporation, [A BUSINESS] trust, [AN ESTATE, A TRUST, A PARTNERSHIP, A] limited liability company, [AN] association, [A] joint stock corporation [VENTURE, A GOVERNMENT, A GOVERNMENTAL SUBDIVISION, AN AGENCY, OR AN INSTRUMENTALITY, A PUBLIC CORPORATION], or any other legal or corporate [COMMERCIAL] entity identified by the department;

58.60.

(22) "state" means a state of the United States, the DistriftDistrict of Columbia, Puerto Rico, the United States Virgin Islands, a United States military installation that is located in a foreign country, or a territory or insular possession subject to the jurisdiction of the United States;

59.61.

(23) "stored value" (A) means (i) monetary value representing a claim against the issuer that is evidenced by an electronic or digital record and that is intended and accepted as a means of redemption for money or monetary value,value or payment for goods or services;

(B) does not mean a paymentinstrumentpayment instrument or a closed-loop stored value,value or a stored value not sold to the public but issued and distributed as part of a loyalty, rewards, or promotional program;

60.62.

Enrolled SB 86 -48- * Sec.

61.63.

SB0086A -49- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (25) "accredited state" means a state agency that is accredited by an organization that the department determines is a nationally recognized association of state bank supervisors and money transmitter regulators for money transmission licensing and supervision;

(26) "acting in concert" means persons knowingly acting together with aacommon common goal ofofjointly jointly acquiring control ofofa alicenseewhetherornot licensee whether or not under an express agreement;

(33) "eligible rating service" means a nationally recognized statistical -49- Enrolled SB 86 rating organization, as determined by the United States Securities and Exchange SB 86 -50- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I Commission, and any other nationally recognized statistical rating organization designated by the department by regulation;

(34) "federally insured depository financial institution" means a bank, credit union, savings and loan association, trust company, savings association, savings bank,bank,industrial industrial bank, ororindustrial industrialloancompanyorganized loanunderthelaws companyoftheUnited organized under the laws of the United States or any state that has federally insured deposits;

(40) "money"moneyreceivedfortransmission"meansmoneyormonetaryvalue received for transmission" means money or monetary value received in the United States for transmission within or outside the United States by electronic or other means;

(42) "outstanding money transmission obligation" means (A) a payment instrument or stored value issued or sold by a licensee to a person located in the United States, or reported as sold by an authorizedauthorizeddelegateofthelicenseetoapersonthatislocatedintheUnitedStates, delegate of the licensee to a person that is located in the United States, that has not yet been paid or refunded by or for the licensee,licensee or escheated in accordance with applicable abandoned property laws;

or (B) money received for transmission by the licensee or an authorized delegate in the United States from a person located in the United States that has not been received by the payee or refunded to the sender,sender or SB0086AEnrolled -51- SB 86 New-50- Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I escheated in accordance with applicable abandoned property laws;

(B) does not mean (i) a transaction in which a merchant grants, as part of an affinity or rewards program, value that cannot be taken from or exchanged with thethemerchant merchantformoney,bank for money, bank credit, ororvirtual virtual currency;

or (ii) aadigitalrepresentationofvalueissuedbyoron digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform;

(47) "virtual currency business activity" means (A) exchanging, transferring, or storing virtual currency or SB 86 -52- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I engaging in virtual currency administration, whether directly or through an -51- Enrolled SB 86 agreement with a virtual currency control services vendor;

or (ii) money or bank credit outside the online game, game platform, or family of games offered by or on behalf of the sesame am publisher from which the original digital representation of value was received;

SB0086A -53- SB 86 New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I * Sec.

62.64.

This chapter may be cited as the Alaska Uniform Enrolled SB 86 -52- Money Transmission Modernization [SERVICES] Act.

63.65.

(b) NotwithstandingNotwithstanding(a)ofthissection,anapplicantforalicenseunderAS (a) of this section, an applicant for a license under AS 06.60 or a person controlling a licensee or an applicant for a license under AS 06.55, seeking to acquire control of a licensee under AS 06.55, or acting as a key individual under AS 06.55 may submit the applicant's fingerprints to the Nationwide Mortgage Licensing System and Registry.

64.66.

AS 34.45 is amended by adding a new section to read:

Sec.

34.45.165.

Virtual currency.

(a) Virtual currency is presumed abandoned five years after the later of the following:

(1) the date on which the holder of the virtual currency last sends a written or electronic communication to the apparent owner that is returned as undeliverable;

or (2) the date on which the apparent owner last exercises an act of ownership in the virtual currency.

(b) The presumption in (a) of this section does not apply if the apparent owner sends a written or electronic communication to the holder of the virtual currency in the preceding five years.

(c) In this section, "an act of ownership in the virtual currency" includes (1) performing a transaction using the virtual currency or account in which the virtual currency is held, including buying or selling the virtual currency or making deposits into or withdrawals from the account;

(2) electronically accessing the virtual currency or account in which the virtual currency is held;

(3) performing an activity using another virtual currency or account in which the virtual currency is held that is owned by the apparent owner if the holder of thevirtual currency or account is also theholderof theothervirtual currency oraccount;

or (4) taking another action that reasonably demonstrates to the holder of the virtual currency or account in which the virtual currency is held that the apparent -53- Enrolled SB 86 owner knows the property exists.

* Sec.

67.

AS 34.45.280(b) is amended to read:

(b) Thereport must bemadeon a form bearing anoticethat statements are made under penalty of unsworn falsification and must include (1) except with respect to traveler's checks and money orders, the name, if known, and last known address, if any, of each person appearing from the records of the holder to be the owner of property, the value of which is $100 or more, presumed abandoned under AS 34.45.110 - 34.45.430 and other statutes specifically made subject to this reporting requirement;

(2) in the case of unclaimed money amounting to $100 or more, held or owing under a life or endowment insurance policy or annuity contract, the full name and last known address of the insured or annuitant and of the beneficiary or other person who is entitled to the proceeds according to the records of the insurance company holding or owing the funds;

(3) in the case of the contents of a safe deposit box or other safekeeping repository or of other tangible personal property, a description of the property and the place where it is held and may be inspected by the department and any amounts owing to the holder;

(4) in the case of virtual currency, the type of virtual currency, quantity of virtual currency, valuation of the virtual currency in dollars on the date that the virtual currency was presumed abandoned, and whether the holder of the virtual currency has full control of the necessary private keys required to transfer the virtual currency;

(5) [(4)] the nature and identifying number, if any, or description of the property and the amount appearing from the records to be due;

items of value under $100 each may be reported in the aggregate;

(6) [(5)] the date the property became payable, demandable, or returnable, and the date of the last transaction with the apparent owner with respect to the property;

and (7) [(6)] other information that the department prescribes by regulation as necessary for the administration of this chapter.

Enrolled SB 86 -54- * Sec.

68.

AS 34.45.320(a) is amended to read:

(a) Except as otherwise provided in (b) or (e) of this section, a person who is required to file a report under AS 34.45.280, shall, at the time of filing the report under that section, pay or deliver to the administrator all of the property shown on the report and remaining unclaimed by the apparent owner.

Upon written request showing good cause, the administrator may postpone the payment or delivery upon the terms or conditions the administrator considers necessary and appropriate.

The property paid or delivered to the administrator must include all interest, dividends, increments, and accretions due, payable, or distributable on the property at the time of filing the report.

If payment or delivery is postponed, the property paid or delivered to the administrator must include all interest, dividends, increments, and accretions due, payable, or distributable on the day that the property is paid or delivered to the administrator.

* Sec.

69.

AS 34.45.320 is amended by adding a new subsection to read:

(e) The holder of a virtual currency shall pay or deliver the virtual currency to the administrator in the native form of the virtual currency.

If the holder is unable to pay or deliver the virtual currency to the administrator, the holder shall maintain possession of the virtual currency until the holder is able to pay or deliver the virtual currency, the requirements under (b) of this section are met, or an election not to receive custody of the virtual currency is made by the department under AS 34.45.410(a).

If payment or delivery of the virtual currency to the administrator is not practical or the administrator holding the virtual currency is uneconomical despite the best efforts of the administrator, the administrator may postpone delivery of the virtual currency upon the terms or conditions the administrator considers necessary and appropriate.

* Sec.

70.

AS 34.45.380 is amended by adding a new subsection to read:

(g) If a holder is in possession of virtual currency because payment or delivery waspostponed underAS 34.45.320(a)or(e),aperson,excluding anotherstate,claiming an interest in the virtual currency may file a claim in the form and bearing the notice required under (a) of this section.

If the claim is allowed and the holder is able to pay or deliver the virtual currency, the holder shall pay or deliver the virtual currency to the claimant upon receiving notice from the department.

If the holder pays or delivers the virtual currency to the claimant in good faith under this subsection and another person -55- Enrolled SB 86 subsequently claims the virtual currency from the holder or another state claims the virtual currency under the laws of the other state relating to escheat or unclaimed property, the department shall defend the holder against the claim and indemnify the holder against liability on the claim upon receiving written notice of the claim.

* Sec.

71.

AS 34.45.390(c) is amended to read:

(c) The department shall require a state, before recovering property under this section, to agree to indemnify this state, this state's [AND ITS] officers and employees, and, if applicable, a holder paying or delivering possession of virtual currency under (d) of this section against liability on a claim for the property.

* Sec.

72.

AS 34.45.390 is amended by adding a new subsection to read:

(d) If a holder is in possession of virtual currency because payment or delivery was postponed under AS 34.45.320(a) or (e), another state may make a claim to recover abandoned virtual currency in the form required under (b) of this section.

The department shall allow the claim if the department determines that the other state is entitled to the abandoned virtual currency under (a) of this section.

If the claim is allowed and the holder is able to pay or deliver the virtual currency, the holder shall pay ordeliverpossession ofthevirtual currency to theotherstateuponreceiving noticefrom the department.

* Sec.

73.

AS 34.45.760(11) is amended to read:

(11) "intangible property" (A) includes (i) money, checks, drafts, warrants, deposits, interest, dividends, [AND] income, and virtual currency;

(ii) credit balances, customer overpayments, gift certificates, security deposits, refunds, credit memos, unpaid wages, and unidentified remittances;

(iii) stocks and other intangible equity interests in business associations;

(iv) money deposited to redeem stocks, bonds, coupons, and other securities, or to make distributions;

(v) amounts due and payable under the terms of Enrolled SB 86 -56- insurance policies;

(vi) amounts distributable from a trust or custodial fund established under a plan to provide health, welfare, pension, vacation, severance, retirement, death, stock purchase, profit-sharing, employee savings, supplemental unemployment insurance, or similar benefits;

and (vii) amounts due and payable as mineral proceeds;

(B) does not include (i) unused airline tickets;

(ii) shares of stock issued by a corporation organized under 43 U.S.C.

1601 et seq.

(Alaska Native Claims Settlement Act) or unclaimed dividends payable on the shares of stock;

or (iii) overpaid contributions by employers to the unemployment compensation fund under AS 23.20.130;

* Sec.

74.

AS 34.45.760 is amended by adding new paragraphs to read:

(20) "blockchain" includes data that is (A) shared across a peer-to-peer network to create a ledger of verified transactions or information among network participants that is linked together using cryptography to maintain the integrity of the ledger and execute other functions;

or (B) distributed among network participants automatically to concurrently update the network participants on the state of a ledger and other functions;

(21) "private key" means a unique element of cryptographic data used for signing transactions on a blockchain and that is known to the owner of the element;

(22) "virtual currency" has the meaning given in AS 06.55.990.

* Sec.

75.

65.76.

-57- Enrolled SB 86 INDIRECT COURT RULE AMENDMENT.

AS 06.55.605,06.55.605(b), asenacted amended by sec.

3738 of this Act, has the effect of changing Rules 79 and 82, Alaska Rules of Civil Procedure, by changing the award of court costs and attorney fees in certain cases.

66.77.

Contracts, rights, liabilities, and obligations created by or under a law repealed or amended by thissecs. Act, and in effect on the day before the effective date of the repeal or amendment, remain in effect notwithstanding this Act taking effect.

1 - 65 and 75 - 78 of this Act, and in effect on the day before the effective date of the repeal or amendment, remain in effect notwithstanding secs.

1 - 65 and 75 - 78 of this Act taking effect.

67.78.

A person that has a valid money services license or approval on DecemberJune 31,30, 2025,2027, may continue to operate under that license or approval until the licensee renews the license under AS 06.55.106, enactedas repealed and reenacted by sec.

5 of this Act, or through July 1, 2027,2028, whichever is later.

In this section, SB 86 -54- SB0086A New Text Underlined [DELETED TEXT BRACKETED] 34-LS0305\I (1) "approval" means approval under AS 06.55.103, as that section read on DecemberJune 31,30, 2025;2027;

(2) "money services licensee" has the meaning given in AS 06.55.990, as that section read on DecemberJune 31,30, 2025.2027.

68.79.

TRANSITION:

REGULATIONS.

(a) The Department of Commerce, Community, and Economic Development may adopt regulations necessary to implement the changes made by secs.

1 - 65 and 75 - 78 of this Act.

The regulations take effect under AS 44.62 (Administrative Procedure Act), but not before the effective date of the law implemented by the regulation.

(b) The Department of Revenue may adopt regulations necessary to implement the changes made by secs.

66 - 74 of this Act.

The regulations take effect under AS 44.62 (Administrative Procedure Act), but not before the effective date of the law implemented by the regulation.

* Sec.

80.

The uncodified law of the State of Alaska is amended by adding a new section to Enrolled SB 86 -58- read:

AS 06.55.605,06.55.605(b),enacted as amended by sec.

3738ofthis of this Act, takes effect only if sec.

6576 of this Act receives the two-thirds majority vote of each house required by art.

69.81.

ThisSection 79 of this Act takes effect Januaryimmediately 1,under 2026.AS 01.10.070(c).

SB0086A* -55-Sec. SB 86 New Text Underlined [DELETED TEXT BRACKETED]

82.

Sections 1 - 65 and 75 - 78 of this Act take effect July 1, 2027.

-59- Enrolled SB 86