On August 9, the Governor of Illinois signed SB 3412 (the “Act”) into law, creating a new regulatory framework for money transmission. This Act, named the Uniform Money Transmission Modernization Act, replaces the previous Transmitters of Money Act. The Act aims to standardize and modernize the regulation, licensing, and supervision of money transmission activities across states. The Act protects the public from financial crimes, reduces regulatory burdens, and ensures the safety of customer funds. The Act introduces specific licensing requirements, such as applicants providing detailed financial and operational information. It mandates that licensees maintain a tangible net worth and permissible investments to safeguard customer funds. Additionally, it outlines the roles and responsibilities of authorized delegates, ensuring compliance with state and federal laws. 

Licensees must submit regular reports, including audited financial statements and records of money transmission activities. The Act grants the Secretary of Financial and Professional Regulation the authority to conduct compliance examinations. It includes provisions for a transition period, allowing current licensees to continue operating under the new regulations upon license renewal. The Act also establishes the Transmitters of Money Act (TOMA) Consumer Protection Fund to provide restitution to consumers who suffer monetary losses due to violations. The new regulations take effect immediately, with certain provisions becoming effective on January 1, 2026.