Wyoming Money Transmitter Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain Wyoming Money Transmitter Bonds
At a Glance:
- Lowest Cost: 1.5% of the bond amount per year based on the applicant’s credit
- Bond Amount: Between $10,000 to $500,000 (more on this later)
- Who Needs it: All money transmitters operating in Wyoming
- Purpose: To ensure the public will receive compensation for any damages should the money transmitter fail to comply with licensing law
- Who Regulates Money Transmitters in Wyoming: The Wyoming Division of Banking
Wyoming Statute 40-22-105 requires all money transmitters operating in the state to obtain a license with the Division of Banking. The Wyoming legislature enacted the licensing laws and regulations to ensure that money transmitters engage in ethical business practices. To provide financial security for the enforcement of the licensing law, Money Transmitters must purchase and maintain a surety bond to be eligible for licensure.
What is the Purpose of the Wyoming Money Transmitter Bond?
Wyoming requires money transmitters to purchase a surety bond as part of the application process to obtain a business license. The bond ensures that the public will receive compensation for financial harm if the money transmitter fails to comply with the licensing regulations set forth in Wyoming code Title 40 Chapter 22. Specifically, the bond protects the public in the event the money transmitter engages in any acts of fraud or fails to transmit funds owed to consumers. In short, the bond is a type of insurance that protects the public if the money transmitter breaks licensing laws.
How Can an Insurance Agent Obtain a Wyoming Money Transmitter Bond?
BondExchange makes obtaining a Wyoming Money Transmitter surety bond easy. Simply log in to your account and use our keyword search to find the “money” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
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How is the Bond Amount Determined?
Wyoming statute 40-22-106 dictates that the limit on the money transmitter bond must be equal to 2.5 times the money transmitter’s total outstanding payment instruments, or $10,000, whichever is greater.
Is a Credit Check Required for the Wyoming Money Transmitter Bond?
Surety companies will run a credit check on the owners of the money transmission company to determine eligibility and pricing for the Wyoming Money Transmitter Bond. Owners with excellent credit and work experience can expect to receive the best rates. Owners with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the owner’s credit.
How Much Does the Wyoming Money Transmitter Bond Cost?
The Wyoming Money Transmitter surety bond can cost anywhere between 1.5% to 7.5% of the bond amount per year. Insurance companies determine the rate based on a number of factors including your customer’s credit score and experience. The chart below offers a quick reference for the approximate bond cost on a $10,000 bond requirement.
$10,000 Money Transmitter Bond Cost
|Credit Score||Bond Cost (1 year)||Bond Cost (1 month)|
|650 – 799||$200||$20|
|600 – 649||$400||$40|
|550 – 599||$750||$75|
How Does Wyoming Define “Money Transmitter?”
Wyoming statute 40-22-101. defines a money transmitter as any business entity who sells or issues payment instruments or who receives money for transmission.
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How do Money Transmitters Apply for a License in Wyoming?
Money transmitters in Wyoming must navigate several steps to secure their license. Below are the general guidelines, but license applicants should refer to the NMLS’s application guidelines for details on the process.
License Period – The Wyoming Money Transmitter License expires on October 1st of each year and must be renewed before the expiration date
Step 1 – Meet the Net Worth Requirements
Applicants for the Wyoming Money Transmitter License must have a company net worth (assets – liabilities) of at least $25,000. Applicants must submit financial statements, prepared by a CPA, verifying their net worth when submitting their license application.
Step 2 – Purchase a Surety Bond
Money Transmitters must purchase and maintain a surety bond (limits outlined above)
Step 3 – Request an NMLS Account
The Wyoming Money Transmitter License application is submitted electronically through the Nationwide Multistate Licensing System (NMLS). To submit a license application, applicants must first request to obtain an NMLS account.
Step 4 – Complete the Application
All Wyoming Money Transmitter License applications can be completed online through the NMLS. Applicants must complete the entire application, and submit the following items:
- Company financial statements indicating a net worth of at least $25,000
- Locations of all company authorized agents
- Primary company and consumer complaint contact information
- Bank account information for the company’s letter/line of credit, operating, and/or trust primary account(s)
- Disclosure questions
- Company business plan containing the following information:
- Marketing strategies
- Target markets
- Operating structure
- Activities conducted by the company
- History of operations
- Business activities the company will perform in Wyoming
- Certificate of Good Standing
- Samples of all documents used throughout the company’s regular course of business
- Company management and organizational charts
- List of all permissible investments
- Company formation documents
- Copies of all filings made with the Securities and Exchange Commission within the past year
Money transmitters must pay the following fees when submitting their license application:
- $1,500 license fee
- $36.25 background check fee (per person)
- $15 credit report fee (per person)
How Do Wyoming Money Transmitters Renew Their License?
Money transmitters can renew their license online through the NMLS. License holders need to simply login to their account to access their renewal application. The Wyoming Money Transmitter License expires on October 1st of each year and must be renewed before the expiration date.
What Are the Insurance Requirements for the Wyoming Money Transmitter License?
Wyoming does not require money transmitters to purchase any form of liability insurance as a prerequisite to obtaining a business license. Money Transmitters must purchase and maintain a surety bond (limits outlined above).
How Do Wyoming Money Transmitters File Their Bond?
Money transmitters should submit the completed bond form, including the power of attorney, electronically through the NMLS. The surety bond requires signatures from both the surety company that issues the bond and a representative from the money transmission company. The surety company should include the following information on the bond form:
- Legal name and state of incorporation of entity/individual(s) buying the bond
- Surety company’s name and state of incorporation
- Bond amount
- Date the bond goes into effect
- Date the bond is signed
What Can Wyoming Money Transmitters Do to Avoid Claims Against Their Bond?
To avoid claims made against their bond, money transmitters in Wyoming must follow all license regulations in the state. Including some of the most important issues below that tend to cause claims:
- Do not engage in any acts of fraud
- Transmit all funds owed to consumers
What Other Insurance Products Can Agents Offer Money Transmitters in Wyoming?
Wyoming does not require money transmitters to purchase any form of liability insurance as a prerequisite to obtaining a business license. However, most reputable businesses will seek to obtain this insurance anyway. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Wyoming Money Transmitter Customers?
The NMLS conveniently provides a public database to search for active Money Transmitters in Wyoming. The database can be accessed here. Contact BondExchange for help developing a marketing piece. Agents can also leverage our print-mail relationships for discounted mailing services.