.................... moves to amend H.F. No. 1682, the first engrossment, as follows:
Page 3, after line 35, insert:
"Of the general fund amount, $646,000 in fiscal year 2014 and $642,000 in fiscal
1.4year 2015 is to establish the regulation of gold bullion dealers.
Amend the totals and subtotals accordingly
Page 18, after line 4, insert:
1.8REGULATION OF BULLION COIN DEALERS
Section 1. [80G.01] DEFINITIONS.
1.10 Subdivision 1. Scope. For purposes of this chapter, the following terms have the
1.11meanings given to them in this section.
1.12 Subd. 2. Bullion coin. "Bullion coin" means any coin containing more than one
1.13percent by weight of silver, gold, platinum, or other precious metal.
1.14 Subd. 3. Bullion coin dealer. (a) Subject to the exceptions in paragraph (b), a
1.15"bullion coin dealer" means any person who buys, sells, solicits, or markets bullion
1.16coins or investments in bullion coins to consumers and is either incorporated, registered,
1.17domiciled, or otherwise located in this state, or who does business with a consumer
1.18domiciled, residing, or otherwise located in this state.
1.19(b) A "bullion coin dealer" does not include any of the following persons:
1.20(1) a person who engages only in wholesale bullion coin transactions with bullion
1.21coin dealers who sell at retail and are properly registered under this chapter;
1.22(2) a person who engages only in transactions at occasional garage or yard sales
1.23held at the seller's residence, farm auctions held at the seller's residence, or estate sales
1.24held at the decedent's residence;
2.1(3) a person who is properly registered pursuant to chapter 80A, or the federal
2.2Securities Exchange Act of 1934 and rules promulgated thereunder as a securities broker
2.3dealer or broker dealer agent; or
2.4(4) an auctioneer who auctions coins at auction on behalf of an owner, if the
2.5auctioneer does not take title or ownership of the coins.
2.6 Subd. 4. Coin dealer representative. "Coin dealer representative" means any
2.7natural person acting as an employee, contractor, or agent of a bullion coin dealer and who
2.8has interactions with consumers in connection with the buying, selling, solicitation, or
2.9marketing of bullion coins or investments in bullion coins.
2.10 Subd. 5. Commissioner. "Commissioner" means the commissioner of commerce.
2.11 Subd. 6. Owner. "Owner" means any person who has an ownership interest in a
2.12bullion coin dealer, regardless of whether directly or indirectly, of more than one percent.
2.13 Subd. 7. Person. "Person" has the same meaning given in section 325F.68,
2.15 Subd. 8. Precious metal content. "Precious metal content" means the quantity,
2.16measured in grams, of gold, silver, platinum, or other precious metal in a coin and the
2.17percentage that the precious metal constitutes of the total weight of the coin.
Sec. 2. [80G.02] REGISTRATION.
2.19 Subdivision 1. Registration required. Beginning July 1, 2014, it shall be unlawful
2.20for a bullion coin dealer or coin dealer representative to solicit, market, buy, sell, or deliver
2.21bullion coins or investments in bullion coins to a consumer without being registered by the
2.22commissioner as provided for in this chapter, if the bullion coin dealer has engaged in a
2.23bullion coin transaction or transactions with consumers during the 12-month period prior
2.24to July 1, 2014, that exceed $5,000 in the aggregate, as determined by the transactions'
2.25sale prices. If a bullion coin dealer was not required to be registered beginning on July 1,
2.262014, the bullion coin dealer must submit an application to register itself and each of its
2.27coin dealer representatives within 30 days of reaching $5,000 in the aggregate of bullion
2.28coin transactions with consumers in any 12-month period prior to July 1 of any calender
2.29year, as determined by the transactions' sale prices. Once a bullion coin dealer is required
2.30to register itself and its coin dealer representatives, the coin dealer must thereafter renew
2.31its registration and the registration of each of its coin dealer representatives in accordance
2.32with this chapter, regardless of the aggregate amount of transactions, unless the person
2.33ceases to be a bullion coin dealer. A coin dealer representative may not buy, sell, solicit,
2.34or market bullion coins or investments in bullion coins on behalf of a bullion coin dealer
2.35unless the dealer is properly registered with the commissioner under this section.
3.1 Subd. 2. Registration obligations. If a bullion coin dealer must register itself and
3.2each of its coin dealer representatives with the commissioner, the bullion coin dealer shall
3.3certify in its application and the application for each of its coin dealer representatives that
3.4the bullion coin dealer and its coin dealer representatives satisfy the requirements of
3.5sections 80G.03 to 80G.07 Registrations issued or renewed by the commissioner under
3.6this chapter shall expire on June 30 and must be renewed.
3.7 Subd. 3. Registration application and renewal. The application and renewal
3.8forms shall include the following information, as applicable, which shall be considered by
3.9the commissioner in determining whether to issue a registration and whether to thereafter
3.10renew the registration:
3.11(1) the name, assumed names, doing business as names, including caller
3.12identification names, and business addresses of the bullion coin dealer, the name of
3.13each owner and officer, and the name and primary work location of each coin dealer
3.14representative. A bullion coin dealer who desires to carry on business in more than one
3.15location shall identify each address where business is conducted;
3.16(2) if a bullion coin dealer is doing business under any name other than the dealer's
3.17legal name, documentation that the assumed name has been properly filed with the
3.18secretary of state;
3.19(3) the telephone numbers, including cellular phone numbers, electronic mail
3.20addresses, and Web site domain names used or intended to be used by the bullion coin
3.21dealer and its coin dealer representatives to buy, sell, solicit, market, or deliver to
3.22consumers bullion coin or investments in bullion coin;
3.23(4) the disclosure of all criminal convictions by any court within the last ten years
3.24for the bullion coin dealer and each officer and owner of the bullion coin dealer and
3.25for each of its coin dealer representatives;
3.26(5) the disclosure of any civil judgments or government agency orders, including
3.27but not limited to, conciliation court or equivalent judgments against the bullion coin
3.28dealer, its officers and owners, or its coin dealer representatives for violation of consumer
3.29protection laws or unfair trade practice laws or for failure to account to a customer for
3.30money or property received from the consumer;
3.31(6) the disclosure of any settlement or other agreement with any person or any
3.32government entity resolving allegations by the person or government entity that the
3.33bullion coin dealer, its officers and owners, or its coin dealer representatives violated
3.34consumer protection or unfair trade practice laws, or for failure to account to a consumer
3.35for money or property received from the consumer; and
4.1(7) the disclosure of any instance in which the bullion coin dealer, its officers and
4.2owners, and its coin dealer representatives were at any time permanently or temporarily
4.3prohibited by any court of competent jurisdiction or ordered to cease and desist as the
4.4result of a government agency action from engaging in buying, selling, soliciting, or
4.5marketing of bullion coin or investments in bullion coin.
4.6 Subd. 4. Notice of change in registration information. A bullion coin dealer must
4.7provide the commissioner written notice of a change in the dealer's name, assumed names,
4.8doing business as names, business addresses, including all business addresses at which it
4.9or its coin dealer representatives conduct business, owners, electronic mail addresses, Web
4.10site domain names, or telephone numbers used by it or its coin dealer representatives to
4.11buy, sell, solicit, or market to consumers bullion coin or investments in bullion coin no
4.12later than ten days after the change occurs.
4.13 Subd. 5. Registration fee. (a) The fee for each registration under this chapter
4.14shall be as follows:
4.15(1) bullion coin dealers, $25; and
4.16(2) coin dealer representatives, $10.
4.17(b) The commissioner, based on the cost of processing registrations, may adjust the
4.18registration fee on an annual basis as needed.
Sec. 3. [80G.03] REGISTRATION DENIAL, NONRENEWAL, REVOCATION
4.21 Subdivision 1. Authority. The commissioner may, by order, suspend, revoke, or
4.22refuse to issue or renew a bullion coin dealer or coin dealer representative registration for
4.23any one or more of the following causes:
4.24(1) providing incorrect, false, misleading, or incomplete information to the
4.25commissioner or refusing to allow a reasonable inspection of information and documents
4.26in the possession of the bullion coin dealer, coin dealer representative, or a third party or
4.27to allow a reasonable inspection of premises;
4.28(2) obtaining or attempting to obtain a registration through misrepresentation or fraud;
4.29(3) having a bullion coin dealer or coin dealer representative registration or its
4.30equivalent, including licensure under section 325F.73, denied, suspended, or revoked, or
4.31having been the subject of a fine or any other discipline in any locality within the state or
4.32other state, province, district, or territory;
4.33(4) being permanently or temporarily enjoined by any court of competent jurisdiction
4.34or being ordered to cease and desist by a government agency from engaging in or
5.1continuing any conduct or practice involving the buying, selling, soliciting, or marketing
5.2of bullion coins, investments in bullion coins, or precious metal to consumers;
5.3(5) violating any federal, state, or local law or rule related to selling, purchasing,
5.4solicitation, or marketing of bullion coin, investments in bullion coin, or precious metal;
5.5(6) violating the provisions of this chapter or of sections 45.027; 325D.43 to
5.6325D.48; 325F.67; 325F.68 to 325F.69; 325F.694; and 325F.73 to 325F.744, or federal
5.7or state taxation or labor law; or
5.8(7) violating a subpoena or order of the commissioner or a court issued pursuant
5.9to this chapter or sections 45.027; 325D.43 to 325D.48; 325F.67; 325F.68 to 325F.69;
5.10325F.694; 325F.70; and 325F.73 to 325F.744.
5.11 Subd. 2. Bullion coin dealer responsibility for actions of coin dealer
5.12representatives. The commissioner may take action against a bullion coin dealer for any
5.13violations of this chapter by its coin dealer representatives. The commissioner may also
5.14take action against the coin dealer representative.
5.15 Subd. 3. Other authority of the commissioner. If a registration lapses, is
5.16surrendered, withdrawn, terminated, or otherwise becomes ineffective, the commissioner
5.17may institute a proceeding under this subdivision within two years after the registration
5.18was last effective and enter a revocation order as of the last date on which the registration
5.19was in effect, and impose a civil penalty as provided for in section 45.027, subdivision 6.
5.20 Subd. 4. Effect of revocation. A revocation of a registration prohibits the bullion
5.21coin dealer or coin dealer representatives from making a new application for a registration
5.22for at least two years from the effective date of the revocation.
Sec. 4. [80G.04] CRIMINAL CONVICTIONS AND FALSE CERTIFICATIONS.
5.24The commissioner must deny an application for registration or renewal of a coin
5.25dealer representative or a bullion coin dealer, or revoke such registration if the coin dealer
5.26representative, the bullion coin dealer, or its owners or officers have:
5.27(1) within the last ten years been convicted in any court of any financial crime or
5.28other crime involving fraud, theft, dishonesty, or moral turpitude;
5.29(2) been unable to truthfully certify that they have no civil judgments or government
5.30agency orders, including but not limited to, conciliation court or equivalent judgments
5.31against them for violation of consumer protection or unfair trade practices laws or failure
5.32to account to a customer for money or property received from the customer; or
5.33(3) been unable to truthfully certify that they have not entered into a settlement or
5.34other agreement with any person or with any government entity resolving concerns by
6.1the person or government entity that they had violated consumer protection or unfair
6.2trade practices laws.
Sec. 5. [80G.05] SCREENING.
6.4 Subdivision 1. Screening process required. Each bullion coin dealer must
6.5establish procedures to screen each of its owners and officers and each of its coin
6.6dealer representatives prior to submitting the application to the commissioner for initial
6.7registration and at each renewal. The results of such screenings shall be provided to the
6.8commissioner as part of the initial registration and all renewal registrations if requested by
6.10 Subd. 2. Initial screening. The screening process for initial registration must be
6.11done no more than 60 days before the submission of an application for registration. The
6.12process must include a national criminal history record search, a judgment search, and a
6.13county criminal history search for all counties where the owner, officer, or coin dealer
6.14representative has resided within the immediately preceding ten years. Each bullion coin
6.15dealer shall use a vendor that is a member of the National Association of Professional
6.16Background Screeners, or an equivalent vendor, to conduct the background screening
6.17process on its owners, officers, and coin dealer representatives.
6.18 Subd. 3. Renewal screening. The screening process for the renewal of a
6.19registration must include a national criminal history record search, a judgment search, and
6.20county criminal history search for all counties where the owner, officer, or coin dealer
6.21representative has resided since satisfactorily completing the last screening process
6.22conducted pursuant to this section. Screening for renewal of the owner, officer, and coin
6.23dealer representative registrations must take place no more than 60 days before the
6.24submission of an application for renewal of a registration.
Sec. 6. [80G.06] SURETY BOND.
6.26 Subdivision 1. Surety bond requirement. Every bullion coin dealer shall maintain a
6.27current, valid surety bond issued by a surety company admitted to do business in Minnesota
6.28in an amount no less than the transactions (purchases from and sales to consumers at retail)
6.29during the 12-month period prior to registration, or renewal, whichever is applicable. In
6.30no event shall the surety bond required under this subdivision be more than $200,000.
6.31 Subd. 2. Action on bond permitted. A consumer injured in money or property by a
6.32bullion coin dealer's or coin dealer representative's failure to provide bullion coins that
6.33the consumer has paid for or failure to remit money or goods owed to the consumer in
6.34connection with the consumer's sale of bullion coins may file a claim with the surety and
7.1if the claim is not paid, is authorized to bring an action based on the bond and recover
7.2against the surety. The commissioner or attorney general may also file a claim and bring
7.3an action on the bond and recover against the surety on behalf of a consumer so injured.
Sec. 7. [80G.07] PROHIBITED CONDUCT.
7.5 Subdivision 1. Sales practices. No bullion coin dealer or coin dealer representative
7.7(1) prior to a transaction regarding bullion coins, or concurrent with delivery thereof,
7.8fail to provide to the consumer in writing, in a clear and conspicuous manner, the sale
7.9or purchase price and the precious metal content of the bullion coins involved in the
7.10transaction. The written notice shall also include the bullion coin dealer's registration
7.11identification information issued by the commissioner, and the Department of Commerce's
7.12e-mail address and telephone number. A copy of the written notice shall be provided to
7.13the consumer and a copy retained by the bullion coin dealer;
7.14(2) fail to deliver bullion coins to a consumer within the time agreed upon with
7.15the consumer or, if no such agreement exists, within 30 days after the consumer has
7.16paid for the coins;
7.17(3) fail to pay a consumer for purchased bullion coins within the time agreed upon
7.18with the consumer or, if no such agreement exists, within 30 days after the consumer
7.19has provided the coins;
7.20(4) fail to provide a written invoice at the time of the transaction specifically
7.21identifying and describing the bullion coins involved in the transaction, the quantity of
7.22bullion coins involved in the transaction, and the bullion coins' sale or purchase price and
7.23precious metal content. The written invoice shall include the bullion coin dealer registration
7.24identification information issued by the commissioner, and the Department of Commerce's
7.25e-mail address and telephone number. A copy of the transaction documentation shall be
7.26provided to the consumer and a copy retained by the bullion coin dealer;
7.27(5) misrepresent the value of the bullion coins, the delivery date of bullion coins
7.28or payment for bullion coins, or the dealer or representative's professional qualifications,
7.29affiliations, or registration;
7.30(6) misrepresent the manner in which any bullion coins a consumer provides will be
7.31stored or otherwise handled once received;
7.32(7) renegotiate the terms of a sale or purchase after receiving a consumer's payment
7.33or bullion coins without first obtaining the consumer's agreement to renegotiate and
7.34offering the consumer the option to have the payment fully refunded or the entirety of
7.35the bullion coins returned;
8.1(8) fail to respond within three business days to a consumer inquiry about the
8.2delivery status of bullion coins that the consumer has paid for but not yet received or the
8.3status of a payment for bullion coins that the consumer has already provided;
8.4(9) telephone or solicit a consumer, or sell or provide the consumer's name to any
8.5other bullion coin dealer or coin dealer representative after the consumer requests to
8.7(10) violate a subpoena or order of the commissioner or a court;
8.8(11) make any communication to a potential buyer or seller of bullion coins that
8.9misrepresents the relationship, if any, between the bullion coin dealer or coin dealer
8.10representative and any government agency or mint;
8.11(12) improperly withhold, misappropriate, or convert any money or properties
8.12received in the course of buying, selling, soliciting, or marketing bullion coins or
8.13investments in bullion coins to consumers;
8.14(13) misrepresent the terms of an actual or proposed purchase or sale of bullion coins
8.15or investment in bullion coins to a consumer; or
8.16(14) violate any other federal, state, or local law or rule related to selling, purchasing,
8.17soliciting, or marketing of bullion coin, investments in bullion coin, or precious metals, or
8.18any federal, state, or local law related to fraudulent, coercive, or dishonest practices, or
8.19federal, state, or local law related to taxation or labor standards.
8.20 Subd. 2. Application. From August 1, 2013, to June 30, 2014, this section shall
8.21apply to any bullion coin dealer and its coin dealer representatives if the bullion coin
8.22dealer is engaged in a bullion coin transaction or transactions with consumers which
8.23exceed $5,000 in the aggregate, as determined by the transaction sale prices, during the
8.2412-month period prior to August 1, 2013. On or after July 1, 2014, this section shall
8.25apply to any bullion coin dealer and its coin dealer representatives which is or should be
8.26registered in accordance with the provisions of this chapter.
Sec. 8. [80G.08] CONSUMER FRAUD.
8.28A violation of this chapter is a violation of section 325F.69, subdivision 1. The
8.29provisions of section 8.31 apply to this chapter.
Sec. 9. [80G.09] CRIMINAL VIOLATION.
8.31A person who conducts business as a bullion coin dealer or as a coin dealer
8.32representative without having first registered with the commissioner, or who carries on
8.33such business after the revocation, suspension, or expiration of a registration, or who
8.34violates section 80G.07, subdivision 1, clause (2) or (3), is guilty of a misdemeanor.
Sec. 10. [80G.10] OTHER ACTION; LOCAL AUTHORITY.
9.2Nothing in this chapter precludes an action under chapter 80A or preempts local
9.3government authority under section 325F.742.
Sec. 11. [80G.11] INVESTIGATIONS AND CIVIL ENFORCEMENT.
9.5 Subdivision 1. Civil action instituted by commissioner or attorney general. If
9.6the commissioner or attorney general believes that a person has engaged, is engaging, or is
9.7about to engage in an act, practice, or course of business constituting a violation of this
9.8chapter or a rule adopted or order issued under this chapter or that a person has, is, or is
9.9about to engage in an act, practice, or course of business that materially aids a violation
9.10of this chapter or a rule adopted or order issued under this chapter, the commissioner or
9.11attorney general may maintain an action in the district court to enjoin the act, practice,
9.12or course of business and to enforce compliance with this chapter or a rule adopted or
9.13order issued under this chapter.
9.14 Subd. 2. Relief available. In an action under this section and on a proper showing,
9.15the court may:
9.16(1) issue a permanent or temporary injunction, restraining order, or declaratory
9.18(2) order other appropriate or ancillary relief, which may include:
9.19(i) an asset freeze, accounting, writ of attachment, writ of general or specific
9.20execution, and appointment of a receiver or conservator, that may be the commissioner or
9.21attorney general, for the defendant or the defendant's assets;
9.22(ii) ordering the commissioner or attorney general to take charge and control of
9.23a defendant's property, including investment accounts and accounts in a depository
9.24institution, rents, and profits; to collect debts; and to acquire and dispose of property;
9.25(iii) imposing a civil penalty up to $10,000 for each violation; an order of rescission,
9.26restitution, or disgorgement directed to a person that has engaged in an act, practice, or
9.27course of business constituting a violation of this chapter or a rule adopted or order issued
9.28under this chapter or the predecessor act; and
9.29(iv) ordering the payment of prejudgment and post judgment interest; or
9.30(3) order such other relief as the court considers appropriate.
9.31 Subd. 3. No bond required. The commissioner or attorney general may not be
9.32required to post a bond in an action or proceeding under this chapter.
9.33 Subd. 4. Commissioner authority. (a) If the commissioner determines that a
9.34person has engaged, is engaged, or is about to engage in an act, practice, or course of
9.35conduct constituting a violation of this chapter or a rule adopted or order issued under this
10.1chapter or that a person has materially aided, is materially aiding, or is about to materially
10.2aid an act, practice or course of conduct constituting a violation of this chapter or rule
10.3adopted or order issued under this chapter the commissioner may:
10.4(1) issue an order directing the person to cease and desist from engaging in the
10.5act, practice or conduct or to take other action necessary or appropriate to comply with
10.6this chapter; or
10.7(2) issue an order denying, suspending, revoking or conditioning the registration of
10.8bullion coin dealer or coin dealer representative.
10.9(b) Upon issuance of an order, the commissioner shall promptly serve each person
10.10subject to the order with a copy of the order and a notice that the order has been
10.11issued. The order must include a statement of the reasons for the order and whether the
10.12commissioner will seek a civil penalty or costs of the investigation, and notice that the
10.13person must within 30 days of being serviced with the order request in writing a hearing
10.14and that within 15 days after receipt of a written hearing request from the person, the
10.15matter will be scheduled for a hearing. If a person subject to the order does not request a
10.16hearing within 30 days after the date of service of the order, the order becomes final as to
10.17that person by operation of law. If a hearing is requested, the commissioner, after notice of
10.18an opportunity for hearing to each person subject to the order, may modify or vacate the
10.19order or extend it until final determination.
10.20(c) If a hearing is requested pursuant to subsection (b), a hearing must be held under
10.21chapter 14 and a final order may not be issued unless the commissioner makes findings of
10.22fact and conclusions of law in a record according to chapter 14. The final order may make
10.23final, vacate, or modify the order issued under subsection (a).
10.24(d) Filing of certified final order with court; effect of filing. If a petition for judicial
10.25review of a final order is not filed in accordance with chapter 14, the commissioner may
10.26file a certified copy of the final order with the clerk of a court of competent jurisdiction.
10.27The order so filed has the same effect as a judgment of the court and may be recorded,
10.28enforced, or satisfied in the same manner as a judgment of the court.
10.29(e) Enforcement by court; further civil penalty. If a person does not comply with an
10.30order under this section, the commissioner may petition a court of competent jurisdiction
10.31to enforce the order. The court may not require the commissioner to post a bond in an
10.32action or proceeding under this section. If the court finds, after service and opportunity for
10.33hearing, that the person was not in compliance with the order, the court may adjudge the
10.34person in civil contempt of the order. The court may impose a further civil penalty against
10.35the person for contempt in an amount up to $10,000 for each violation and may grant any
10.36other relief the court determines is just and proper in the circumstances.
11.1(f) In addition to the authority granted under this chapter, the commissioner has all
11.2the authority provided under section 45.027 to ensure compliance with this chapter.
Sec. 12. EFFECTIVE DATE.
11.4This article shall be effective August 1, 2013.
Amend the title accordingly