[Rev. 11/21/2013 1:03:16
PM--2013]
CHAPTER 669 - TRUST COMPANIES
GENERAL PROVISIONS
NRS 669.010 Declaration
of legislative intent.
NRS 669.020 Definitions.
NRS 669.029 “Business
of a trust company” and “trust company business” defined.
NRS 669.040 “Court
trust” defined.
NRS 669.042 “Family
trust company” defined.
NRS 669.045 “Fiduciary”
defined.
NRS 669.047 “Grandfathered
trust company” defined.
NRS 669.049 “Noncustodial
trust company” defined.
NRS 669.050 “Private
trust” defined.
NRS 669.065 “Retail
trust company” defined.
NRS 669.070 “Trust
company” defined.
NRS 669.080 Applicability
of chapter.
ORGANIZATION AND LICENSING
NRS 669.083 Retail
trust company required to maintain principal office in Nevada.
NRS 669.085 Pre-opening
examination by Commissioner; other requirements.
NRS 669.087 License
as retail trust company not transferable; change in control required to be
reported; application; investigation fee.
NRS 669.090 Unlawful
to engage in business of trust company without license.
NRS 669.092 Unlawful
for retail trust company to engage in business at office outside Nevada without
prior approval.
NRS 669.095 Unlawful
to use or advertise word “trust” as part of name; exceptions.
NRS 669.100 Minimum
stockholders’ equity required for organization and operation.
NRS 669.110 Certain
organizational structure required for domestic trust company; authority to do
business in this State required for foreign trust company.
NRS 669.115 Retail
trust company required to have quarterly meetings.
NRS 669.116 Requirements
concerning management or control of certain trust companies.
NRS 669.117 Directors
and managers: Qualifications.
NRS 669.120 Certain
provisions required in articles of incorporation or organization of domestic
trust company; limitations on use of certain names by foreign trust company.
NRS 669.130 Unlawful
for retail trust company to commence business without authorization of
Commissioner.
NRS 669.150 Application
for license: Contents; fees; regulations; withdrawal of application.
NRS 669.160 Investigation
of applicant; rights of applicant upon denial of license; entry of final order;
judicial review.
NRS 669.190 Payment
of license fees; regulations; deposit in State Treasury.
NRS 669.200 Cancellation
of license if retail trust company fails to open for business or maintain
regular business hours.
POWERS AND MISCELLANEOUS PROVISIONS
NRS 669.210 Powers
of retail trust companies; banking business prohibited.
NRS 669.220 Investments:
General requirements.
NRS 669.225 Investments:
Trust company may invest in securities and provide services to investment trust
or investment company; retail trust company may deposit money held in trust
with affiliate.
NRS 669.230 Discontinuing
business.
NRS 669.240 Fidelity
bonds; insurance.
NRS 669.245 Commissioner
authorized to be signatory.
EXAMINATION; REGULATION
NRS 669.250 Fees
for examination; frequency of examination.
NRS 669.260 Applicability
of other provisions of title.
NRS 669.270 Regulations
of Commissioner.
NRS 669.275 Commissioner
authorized to require audited financial statement; submission of list of
stockholders or members.
DISCIPLINARY ACTION AND REMEDIAL ACTION
NRS 669.280 Authority
of Commissioner to take disciplinary action and to close and liquidate
business.
NRS 669.281 Authority
of Commissioner to remove officer, director, manager or employee of retail
trust company; appeal of removal; hearing; judicial review.
NRS 669.2825 Authority
of Commissioner to take disciplinary action or initiate proceedings to seize property.
NRS 669.283 Authority
of Commissioner to investigate.
NRS 669.2845 Revocation
of license; notice and hearing required.
NRS 669.2846 Authority
of Commissioner to issue cease and desist order; action to enjoin by Attorney
General or Commissioner; appointment of receiver.
NRS 669.2847 Revocation
or suspension of license; notice and hearing required; administrative fines.
NRS 669.285 Confidentiality
of records and documents.
UNLAWFUL ACTS; PENALTIES
NRS 669.286 Failure
to submit required report; fees; regulations.
NRS 669.290 Willful
neglect to perform duties imposed by law or failure to conform to material
lawful requirement made by Commissioner unlawful; penalty.
NRS 669.295 Administrative
fines.
NRS 669.300 Violation
of chapter constitutes gross misdemeanor unless otherwise specified.
_________
GENERAL PROVISIONS
NRS 669.010 Declaration of legislative intent. The
Legislature finds as facts and determines that:
1. There exists in this State a need, for
the protection of the public interest, to regulate companies which are engaged
in the trust company business.
2. Such trust companies should be licensed
and regulated in such manner as to promote the public advantage and
convenience.
3. It is the purpose of this chapter to
bring under public supervision those persons who are engaged in or who desire
to engage in the business of a trust company, not in connection with banking
business, and to insure that there is established in this State an adequate,
efficient and competitive trust company service.
(Added to NRS by 1969, 1184)
NRS 669.020 Definitions. As
used in this chapter and chapter 669A of
NRS, unless the context otherwise requires, the words and terms defined in NRS 669.029 to 669.070,
inclusive, have the meanings ascribed to them in those sections.
(Added to NRS by 1969, 1184; A 1999, 842; 2009, 1146,
1956)
NRS 669.029 “Business of a trust company” and “trust company business”
defined. “Business of a trust
company” or “trust company business” means the holding out by a person, by
advertising, solicitation or other means, that it is available to act as a
fiduciary in this state and undertaking to act as a fiduciary in the regular
course of its business.
(Added to NRS by 1999, 841)
NRS 669.040 “Court trust” defined. “Court
trust” means a fiduciary relationship created by an appointment, order or
decree of any court.
(Added to NRS by 1969, 1184; A 1999, 842)
NRS 669.042 “Family trust company” defined.
1. “Family trust company” means a
corporation or limited-liability company that:
(a) Acts or proposes to act as a fiduciary;
(b) Is organized or qualified to do business in
this State to serve family members; and
(c) Does not:
(1) Transact trust company business with;
(2) Propose to act as a fiduciary for; or
(3) Solicit trust company business from,
Ê a person who
is not a family member.
2. As used in this section:
(a) “Designated relative” means the common
ancestor of the family, who may be either a living or deceased person. With
regard to:
(1) A licensed family trust company or a
family trust company applying to be licensed pursuant to this chapter, the
designated relative is the person who is designated in the application for a
license under this chapter or in the annual renewal of a license.
(2) A family trust company other than a
family trust company described in subsection 1, the designated relative is any
person designated by the family trust company in a letter to the Commissioner
sent by certified mail, return receipt requested.
(b) “Family member” includes, without limitation,
the designated relative and:
(1) Any person within the tenth degree of
lineal kinship to the designated relative;
(2) Any person within the ninth degree of
collateral kinship to the designated relative;
(3) Any nonfamily member who is an
individual beneficiary under a will or trust created by a family member
specified in subparagraph (1) or (2), including the spouse and issue of that
person;
(4) The spouse and any former spouse of
the designated relative or of any person qualifying as a family member under
subparagraph (1) or (2 );
(5) Any person within the fifth degree of
lineal kinship of a spouse or former spouse identified in subparagraph (3) or
(4);
(6) A family affiliate and the officers,
managers and directors of that family affiliate and their immediate families;
(7) An inter vivos or testamentary trust
established by a family member either individually or jointly with a spouse or
third party and any trustee, advisor or other person assisting with
administration of that trust;
(8) An inter vivos or testamentary trust
established by a person who is not a family member if noncharitable
beneficiaries of that trust include family members;
(9) The estate of a family member;
(10) The estate of a nonfamily member if
the noncharitable beneficiaries of that estate include family members; and
(11) A charitable foundation, charitable
trust or charitable entity of which a family member is an organizer,
incorporator, officer, member of the governing board, trustee, major donor or
noncharitable beneficiary and the officers, directors, individual trustees and
managers of that foundation, trust or entity and their immediate families.
3. For the purposes of this section:
(a) A family member is not a member of the
public.
(b) A legally adopted person must be treated as a
natural child of the adoptive parents.
(c) A stepchild must be treated as a natural
child of the family member who is or was the stepparent of that child.
(d) Children of a spouse of a family member must
be treated as natural children of that family member.
(e) Degrees are calculated by adding the number
of steps from the designated relative through each person to the family member
either directly, in the case of lineal kinship, or through the common ancestor,
in the case of collateral kinship. As used in this paragraph:
(1) “Collateral kinship” means a
relationship that is not lineal but stems from a common ancestor.
(2) “Lineal kinship” means a family member
who is in the direct line of ascent or descent from the designated relative.
(Added to NRS by 2009, 1947)
NRS 669.045 “Fiduciary” defined.
1. “Fiduciary” means a trustee, executor,
administrator, guardian of an estate, personal representative, conservator,
assignee for the benefit of creditors, receiver, depositary or person that
receives on deposit money or property from a public administrator under any
provision of this chapter or from another fiduciary.
2. As used in this section, “administrator”
includes servicers or administrators of individual retirement accounts within
the meaning of section 408(a) of the Internal Revenue Code of 1986, 26 U.S.C. §
408(a), where the servicer or administrator holds itself out to the public for
performance of such services and holds or maintains an ownership interest in
the servicing rights of such accounts, or possesses or controls any of the
assets of such accounts, including cash.
(Added to NRS by 1999, 841; A 2009, 1956)
NRS 669.047 “Grandfathered trust company” defined. “Grandfathered
trust company” means a trust company that:
1. Held a license pursuant to this chapter
on March 16, 2009; or
2. Filed an application for a license
pursuant to this chapter with the Commissioner on or before March 16, 2009, and
held such license on October 1, 2009.
(Added to NRS by 2009, 1948)
NRS 669.049 “Noncustodial trust company” defined.
1. “Noncustodial trust company” means a
grandfathered trust company that:
(a) Does not manage, or advise regarding, in the
aggregate, more than $100,000,000 worth of a client’s assets;
(b) Does not have custody or control of clients’
assets that exceed 20 percent of the total assets that the trust company
manages for all clients; and
(c) To the extent that the trust company has
custody or control of a client’s assets, invests such assets pursuant to:
(1) Direction by the client; or
(2) The prudent investor standards of NRS 164.700 to 164.775, inclusive.
2. For the purposes of this section:
(a) “Advise” means to provide investment advice.
(b) “Control” means the ability to invest or
transfer cash or any other asset in a fiduciary or client account to any person
other than:
(1) In the case of an account for which
the trust company acts as fiduciary, the settlor or beneficiary; and
(2) In the case of any other account of a
client, the owner of the account.
(c) “Manage” means the exercise of discretion
regarding investments, whether or not that discretion is delegated to another
person.
(Added to NRS by 2009, 1949)
NRS 669.050 “Private trust” defined. “Private
trust” means a fiduciary relationship other than a court trust.
(Added to NRS by 1969, 1184; A 1999, 843)
NRS 669.065 “Retail trust company” defined. “Retail
trust company” means an entity which is licensed under this chapter.
(Added to NRS by 2009, 1949)
NRS 669.070 “Trust company” defined. “Trust
company” means a corporation or limited-liability company licensed as provided
in this chapter and engaged in a trust company business.
(Added to NRS by 1969, 1184; A 1999, 843)
NRS 669.080 Applicability of chapter.
1. This chapter does not apply to a person
who:
(a) Does business under the laws of this State,
the United States or another state relating to banks, savings banks, savings
and loan associations or thrift companies, but if the trust company business
conducted in this State is not subject to supervision by a regulatory authority
of another jurisdiction, the person must be licensed pursuant to this chapter
before engaging in such business in this State;
(b) Is appointed as a fiduciary pursuant to NRS 662.245;
(c) Is acting in the performance of his or her
duties as an attorney at law;
(d) Acts as a trustee under a deed of trust;
(e) Acts as a registered agent for a domestic or
foreign corporation, limited-liability company, limited partnership or
limited-liability partnership;
(f) Acts as a trustee of a trust holding real
property for the primary purpose of facilitating any transaction with respect
to real estate if he or she is not regularly engaged in the business of acting
as a trustee for such trusts;
(g) Engages in the business of a collection
agency pursuant to chapter 649 of NRS;
(h) Engages in the business of an escrow agency,
escrow agent or escrow officer pursuant to the provisions of chapter 645A or 692A
of NRS;
(i) Acts as a trustee of a trust created for
charitable or nonprofit purposes if he or she is not regularly engaged in the
business of acting as trustee for such trusts;
(j) Receives money or other property as a real
estate broker licensed under chapter 645 of
NRS on behalf of a principal;
(k) Engages in transactions as a broker-dealer or
sales representative pursuant to chapter 90
of NRS;
(l) Acts as a fiduciary under a court trust;
(m) Does business as an insurer authorized to
issue policies of life insurance and annuities or endowment contracts in this
State and is subject to regulation and control of the Commissioner of
Insurance;
(n) Acts as a fiduciary as an individual;
(o) Acts as a family trust company, unless the
family trust company is licensed under this chapter. A family trust company
which is not licensed under the provisions of this chapter shall be deemed not
to be engaged in trust company business for the purposes of this chapter; or
(p) Except as otherwise provided in chapter 669A of NRS, is a family trust
company, as defined in NRS 669A.080.
2. A bank, savings bank, savings and loan
association or thrift company claiming an exemption from this chapter pursuant
to paragraph (a) of subsection 1 must notify the Commissioner of Financial
Institutions of its intention to engage in the business of a trust company in
this State and present proof satisfactory to the Commissioner of Financial
Institutions that its fiduciary activities in this State will be subject to
regulation by another jurisdiction.
(Added to NRS by 1969, 1184; A 1981, 339; 1999, 843; 2007, 2725; 2009, 1146,
1956)
ORGANIZATION AND LICENSING
NRS 669.083 Retail trust company required to maintain principal office in
Nevada.
1. A retail trust company licensed in this
State shall maintain its principal office in this State.
2. The conditions for a retail trust
company to fulfill the requirements of subsection 1 include, but are not
limited to:
(a) A verifiable physical office in this State
that conducts such business operations in this State as are necessary to
administer trusts in this State;
(b) The presence of an employee that is a resident
of Nevada in the principal office who has experience that is satisfactory to
the Commissioner in accepting and administering trusts;
(c) Maintenance of originals or true copies of
all material business records and accounts of the retail trust company which
may be accessed and are readily available for examination by the Division of
Financial Institutions;
(d) Maintenance of any cash as a portion of the
required stockholders’ equity pursuant to NRS 669.100
in accounts with one or more banks or other financial institutions located in
this State;
(e) The provision of services to residents of
this State consistent with the business plan provided by the trust company with
its license application; and
(f) Such other conditions that the Commissioner
may reasonably require to protect the public interest.
(Added to NRS by 2009, 1949;
A 2011,
2590)
NRS 669.085 Pre-opening examination by Commissioner; other requirements.
1. In rendering a decision on an
application for a license as a retail trust company, the Commissioner shall
consider:
(a) The proposed market or markets to be served
and, if they extend outside of this State, any exceptional risk, examination or
supervision concerns associated with such markets;
(b) Whether the proposed organizational and
capital structure and the amount of initial capital appear adequate in relation
to the proposed business and market or markets, including, without limitation,
the average level of assets under management and administration projected for
each of the first 3 years of operation;
(c) Whether the proposed officers and directors
or managers of the proposed retail trust company, as a group, have sufficient
experience, ability, standing and competence and whether each individually has
sufficient trustworthiness and integrity to justify a belief that the proposed
retail trust company will be free from improper or unlawful influence and
otherwise will operate in compliance with the law and applicable fiduciary
duties and that success of the proposed retail trust company is reasonably
probable;
(d) Whether any investment services to trusts,
estates, charities, employee benefit plans and other fiduciary accounts or to
natural persons, partnerships, limited-liability companies and other entities,
including, without limitation, providing investment advice with or without
discretion or selling investments in or investment products of affiliated or
nonaffiliated persons, will be conducted in compliance with all applicable
fiduciary standards, including, without limitation, NRS 164.700 to 164.775, inclusive, the duty of loyalty
and disclosure of material information;
(e) Whether the proposed retail trust company
will be exempt from registration under the Investment Advisers Act of 1940, 15
U.S.C. § 80b-1 et seq., and any similar state laws in each state where it would
otherwise be required to register and, if not, whether it will comply with such
registration requirements before commencing business and thereafter will comply
with all federal and state laws and regulations applicable to it, its employees
and representatives as a registrant under such laws;
(f) Whether the proposed retail trust company
will obtain suitable annual audits by qualified outside auditors of its books
and records and its fiduciary activities under applicable account rules and
standards as well as suitable internal audits; and
(g) Any other factors that the Commissioner may
reasonably require.
2. The Commissioner may require a retail
trust company to maintain capital in excess of the minimum required either
initially or at any subsequent time based on the Commissioner’s assessment of
the risks associated with the retail trust company’s business plan or any other
circumstances revealed in the application, the Commissioner’s investigation of
the application or any examination of or filing by the retail trust company
thereafter, including any examination before the opening of the retail trust
company for business. In making such a determination, the Commissioner may
consider:
(a) The nature and type of business proposed to
be conducted by the retail trust company;
(b) The nature and liquidity of assets proposed
to be held in its own account;
(c) The amount of fiduciary assets projected to
be under management or under administration of the retail trust company;
(d) The type of fiduciary assets proposed to be
held and any proposed depository of such assets;
(e) The complexity of fiduciary duties and degree
of discretion proposed to be undertaken by the retail trust company;
(f) The competence and experience of proposed
management of the retail trust company;
(g) The extent and adequacy of proposed internal
controls;
(h) The proposed presence or absence of annual
audits by an independent certified public accountant, and the scope and
frequency of such audits, whether they result in an opinion of the accountant
and any qualifications to the opinion;
(i) The reasonableness of business plans for
retaining or acquiring additional equity capital;
(j) The existence and adequacy of insurance
proposed to be obtained by the retail trust company for the purpose of
protecting its fiduciary assets;
(k) The success of the retail trust company in
achieving the financial projections submitted with its licensing application;
(l) The fulfillment by the retail trust company
of its representations and its descriptions of its business structures and
methods and management set forth in its licensing application; and
(m) Any other factor that the Commissioner may
require.
(Added to NRS by 2009, 1950;
A 2011,
2591)
NRS 669.087 License as retail trust company not transferable; change in
control required to be reported; application; investigation fee.
1. A license issued pursuant to this
chapter is not transferable or assignable, but upon approval of the Commissioner,
a licensee may merge or consolidate with, or transfer its assets and control
to, another entity that has been issued a license under this chapter. In making
a determination regarding whether to grant such approval, the Commissioner may
consider the factors set forth in paragraphs (a) to (m), inclusive, of
subsection 2 of NRS 669.085.
2. If there is a change in control of any
retail trust company, the chief executive officer or managing member of the
retail trust company shall report the fact and the person obtaining control to
the Commissioner within 5 business days after obtaining knowledge of the
change.
3. A retail trust company shall, within 5
business days after there is a change in the chief executive officer, managing
member or a majority of the directors or managing directors of the retail trust
company, report the change to the Commissioner. The retail trust company shall
include in its report a statement of the past and current business and
professional affiliations of each new chief executive officer, managing member,
director or managing director. A new chief executive officer, managing member,
director or managing director shall furnish to the Commissioner a complete
financial statement on a form prescribed by the Commissioner.
4. A person who intends to acquire control
of a retail trust company shall submit an application to the Commissioner. The
application must be submitted on a form prescribed by the Commissioner. The
Commissioner shall conduct an investigation pursuant to NRS
669.160 to determine whether the person has a good reputation for honesty,
trustworthiness and integrity and is competent to control the trust company in
a manner which protects the interests of the general public.
5. The retail trust company with which the
applicant described in subsection 4 is affiliated shall pay the nonrefundable
cost of the investigation as the Commissioner requires. If the Commissioner
denies the application, the Commissioner may forbid or limit the applicant’s
participation in the business of the trust company.
6. As used in this section, “control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policy of a retail trust company, or a
change in the ownership of at least 25 percent of the outstanding voting stock
of, or participating members’ interest in, a retail trust company.
(Added to NRS by 2009, 1951;
A 2011,
2592)
NRS 669.090 Unlawful to engage in business of trust company without license. It is unlawful for any retail trust company to
engage in the business of a trust company without complying with the provisions
of this chapter and having a license issued by the Commissioner.
(Added to NRS by 1969, 1184; A 1983, 1758; 1987, 1942; 2009, 1957)
NRS 669.092 Unlawful for retail trust company to engage in business at
office outside Nevada without prior approval.
1. It is unlawful for any retail trust
company licensed in this State to engage in trust company business at any
office outside this State without the prior approval of the Commissioner.
2. Before the Commissioner will approve a
branch to be located in another state, the retail trust company must:
(a) Obtain from that state a license as a trust
company; or
(b) Provide proof satisfactory to the
Commissioner that the retail trust company has met all the requirements to do
business as a trust company at an office in that state, including, without
limitation, written documentation from the appropriate state agency that the
retail trust company is authorized to do business in that state.
(Added to NRS by 2009, 1952;
A 2011,
2593)
NRS 669.095 Unlawful to use or advertise word “trust” as part of name;
exceptions.
1. Except as otherwise provided in
subsection 2, no person or organization formed and doing business under the
laws of this State or any other state may:
(a) Use the word “trust” or any direct derivative
of that word as a part of its name.
(b) Advertise or use any sign with the word
“trust” used as a part of its name.
2. The provisions of subsection 1 do not
apply to a person or organization which:
(a) Is supervised by the Commissioner of
Financial Institutions pursuant to this chapter or chapters
657 to 668, inclusive, 673 or 677 of
NRS;
(b) Is doing business under the laws of the
United States or another state relating to banks, savings banks, savings and
loan associations or thrift companies;
(c) Is acting under an appointment pursuant to NRS 662.245;
(d) Is supervised by the Commissioner of
Insurance; or
(e) Is doing business solely as a community land
trust.
3. As used in this section, “community
land trust” has the meaning ascribed to it in NRS 82.106.
(Added to NRS by 1983, 466; A 1985, 357; 1987, 1942; 1999, 844; 2007, 93)
NRS 669.100 Minimum stockholders’ equity required for organization and
operation.
1. No retail trust company may be
organized or operated with a stockholders’ equity of less than $1,000,000, or
in such greater amount as may be required by the Commissioner. The full amount
of the initial stockholders’ equity must be paid in cash, exclusive of all
organization expenses, before the trust company is authorized to commence
business.
2. A retail trust company shall maintain
at least 25 percent of its required stockholders’ equity in cash and at least
an additional 25 percent of its required stockholders’ equity in cash or cash
equivalents comprising certificates of deposit, money market funds or other
insured deposits. Cash equivalents held by a retail trust company pursuant to
this subsection may, upon prior approval by the Commissioner, comprise
investments in treasury bills, government obligations or commercial paper
which, if acquired after October 1, 2011, must mature not later than 3 months
after the date of acquisition by the retail trust company. Any certificate of
deposit, money market fund, insured deposit, commercial paper, treasury bill or
government obligation, other than an obligation of the United States or an
obligation guaranteed by the United States, that is held as a cash equivalent
by a retail trust company pursuant to this subsection must not exceed 10
percent of the total required stockholders’ equity at the time the cash
equivalent is purchased. The remaining amount of the retail trust company’s
required stockholders’ equity may be a different form of readily marketable
securities, or with prior approval by the Commissioner, other liquid, secure
asset, bond, surety or insurance, or some combination of the foregoing. Any
bond or other evidence of indebtedness held by a retail trust company pursuant
to this subsection must have an investment grade credit rating and must have
received a rating within one of the top three rating categories of Moody’s
Investors Service, Inc. or Standard and Poor’s Ratings Services.
3. Any grandfathered trust company other
than a noncustodial trust company that does not have the minimum capital
required by this section as of October 1, 2009, shall:
(a) Except as otherwise determined by the
Commissioner, increase its capital to a minimum of:
(1) By October 1, 2010, $500,000;
(2) By October 1, 2011, $750,000; and
(3) By October 1, 2012, $1,000,000; and
(b) Maintain 25 percent of such minimum capital
in cash on and after October 1, 2010.
4. Any noncustodial trust company that does
not have the minimum capital required by this section as of October 1, 2009,
shall:
(a) Except as otherwise determined by the
Commissioner, increase its capital to a minimum of:
(1) By October 1, 2010, $350,000;
(2) By October 1, 2011, $400,000; and
(3) By October 1, 2012, $500,000; and
(b) Maintain 25 percent of such minimum capital
in cash on and after October 1, 2010.
5. As used in this section, “in cash”
means in depository accounts with one or more banks in this State.
(Added to NRS by 1969, 1185; A 1983, 1758; 1987, 1943; 1997, 1007; 2009, 1957;
2011, 2593)
NRS 669.110 Certain organizational structure required for domestic trust
company; authority to do business in this State required for foreign trust
company. An applicant for a
license to conduct the business of a trust company under this chapter must be
organized as a corporation or limited-liability company under the laws of this
State or authorized to do business in this State as a foreign corporation or foreign
limited-liability company.
(Added to NRS by 1969, 1185; A 1999, 844)
NRS 669.115 Retail trust company required to have quarterly meetings. The Commissioner may direct that the board of
directors or managers of a retail trust company meet at least quarterly in
regular meetings to review the books, records, funds and securities held by the
retail trust company in its individual and fiduciary capacities and maintain a
written record of those meetings for review by the Division.
(Added to NRS by 2009, 1953)
NRS 669.116 Requirements concerning management or control of certain trust
companies.
1. Except as otherwise provided in
subsection 3, the affairs and business of a retail trust company organized as a
corporation under the laws of this State must be managed or controlled by a
board of directors of not less than five in number who must be selected by the
stockholders at the annual meeting of stockholders in such manner as may be
provided by the bylaws of the corporation.
2. Except as otherwise provided in
subsection 3, the affairs and business of a retail trust company organized as a
limited-liability company under the laws of this State must be managed or
controlled by no fewer than five managers selected from the members as provided
in the operating agreement.
3. The Commissioner may authorize a retail
trust company to be managed or controlled by no fewer than three directors or
managers, as appropriate.
4. The board of directors or managers of a
noncustodial trust company must be not less than three in number unless a
smaller number is authorized by the Commissioner.
(Added to NRS by 2009, 1953)
NRS 669.117 Directors and managers: Qualifications.
1. No person is eligible to serve as a
director or manager of any retail trust company unless the person:
(a) Displays the competence and integrity to
transact the business of the retail trust company in a manner which safeguards
the interests of the general public; and
(b) Has a financial status consistent with his or
her responsibilities to the public.
2. The Commissioner may require any or all
new directors or managing directors of a retail trust company to provide such
financial and biographical information and verification thereof as the
Commissioner deems appropriate, including the completion of any forms required
to be completed in connection with the licensing of a retail trust company.
(Added to NRS by 2009, 1953)
NRS 669.120 Certain provisions required in articles of incorporation or
organization of domestic trust company; limitations on use of certain names by
foreign trust company.
1. If a corporation or limited-liability
company that is engaged in trust company business is organized under the laws
of this state, the articles of incorporation or articles of organization must
contain:
(a) The name adopted by the trust company, which
must be such as to distinguish it from any other trust company formed or
incorporated in this state, or engaged in the business of a trust company in
this state; and
(b) The purpose for which it is formed.
2. The provisions of subsection 1 do not
apply to a corporation or limited-liability company engaged in trust company
business that is organized under the laws of another state, but it must use a
name that distinguishes it from any other trust company organized as or
conducting the business of a trust company in this state.
(Added to NRS by 1969, 1185; A 1983, 1759; 1987, 774, 1943; 1997, 1007; 1999, 844)
NRS 669.130 Unlawful for retail trust company to commence business without
authorization of Commissioner. A
retail trust company shall not transact business, except business that is
incidental to its organization, until it is authorized by the Commissioner to
commence the business of a trust company as provided in this chapter.
(Added to NRS by 1969, 1185; A 1983, 1759; 1987, 1944; 1997, 1007; 1999, 845; 2009, 1958)
NRS 669.150 Application for license: Contents; fees; regulations; withdrawal
of application.
1. An applicant must file an application
for a license to transact trust company business with the Commissioner on forms
prescribed by the Commissioner, which must contain or be accompanied by such
information as the Commissioner requires.
2. A nonrefundable fee of not more than
$2,000 must accompany the application. The applicant must also pay such
reasonable additional expenses incurred in the process of investigation as the
Commissioner deems necessary. In addition, a fee of not less than $200 or more
than $500, prorated on the basis of the licensing year as provided by the
Commissioner, must be paid at the time of making the application.
3. Except as otherwise provided in NRS 669.092, a trust company may maintain offices in
this and other states. For every branch location of a trust company organized
under the laws of this State, and every branch location in this State of a
foreign trust company authorized to do business in this State, a request for
approval and licensing must be filed with the Commissioner on such forms as the
Commissioner prescribes. A nonrefundable fee of not more than $500 must
accompany each request. In addition, a fee of not more than $200, prorated on
the basis of the licensing year as provided by the Commissioner, must be paid
at the time of making the request.
4. The Commissioner shall adopt
regulations establishing the amount of the fees required pursuant to this
section. All money received by the Commissioner pursuant to this section must
be placed in the Investigative Account for Financial Institutions created by NRS 232.545.
5. The Commissioner shall consider an
application to be withdrawn if the Commissioner has not received all
information and fees required to complete the application within 12 months
after the date the application is first submitted to the Commissioner or within
such later period as the Commissioner determines in accordance with any
existing policies of joint regulatory partners. If an application is deemed to
be withdrawn pursuant to this subsection or if an applicant otherwise withdraws
an application, the Commissioner may not issue a license to the applicant
unless the applicant submits a new application and pays any required fees.
(Added to NRS by 1969, 1186; A 1983, 1317, 1760; 1987, 1944; 1991, 1809; 1999, 845; 2005, 1849; 2009, 1958)
NRS 669.160 Investigation of applicant; rights of applicant upon denial of
license; entry of final order; judicial review.
1. Within 90 days after the application
for a license is filed, the Commissioner shall investigate the facts of the
application and the other requirements of this chapter to determine:
(a) That the persons who will serve as directors
or officers of the corporation, or the managers or members acting in a
managerial capacity of the limited-liability company, as applicable:
(1) Have a good reputation for honesty,
trustworthiness and integrity and display competence to transact the business
of a trust company in a manner which safeguards the interests of the general
public. The applicant must submit satisfactory proof of these qualifications to
the Commissioner.
(2) Have not been convicted of, or entered
a plea of nolo contendere to, a felony or any crime involving fraud,
misrepresentation or moral turpitude.
(3) Have not made a false statement of
material fact on the application.
(4) Have not been an officer or member of
the board of directors for an entity which had a license issued pursuant to the
provisions of this chapter that was suspended or revoked within the 10 years
immediately preceding the date of the application, and in the reasonable
judgment of the Commissioner, there is evidence that the officer or member of
the board of directors materially contributed to the actions resulting in the
license suspension or revocation.
(5) Have not been an officer or member of
the board of directors for a company which had a license as a trust company
which was issued in any other state, district or territory of the United States
or any foreign country suspended or revoked within the 10 years immediately
preceding the date of the application, and in the reasonable judgment of the
Commissioner, there is evidence that the officer or member of the board of
directors materially contributed to the actions resulting in the license
suspension or revocation.
(6) Have not violated any of the
provisions of this chapter or any regulation adopted pursuant to the provisions
of this chapter.
(b) That the financial status of the directors
and officers of the corporation or the managers or members acting in a
managerial capacity of the limited-liability company is consistent with their
responsibilities and duties.
(c) That the name of the proposed company
complies with the provisions of NRS 657.200.
(d) That the initial stockholders’ equity is not
less than the required minimum.
(e) That the applicant has retained the employee
required by paragraph (b) of subsection 2 of NRS 669.083.
2. After an investigation by the
Commissioner pursuant to subsection 1, if the Commissioner finds any defect or
deficiency in an application for licensure which would constitute grounds for
denial of the application, written notice of such grounds for denial must be
served personally or sent by certified mail to the applicant. The Commissioner
shall allow the applicant an opportunity to cure any defect or deficiency in
the application and, not later than 30 days after receipt of the notice of denial,
to resubmit the application for approval.
3. If a defect or deficiency in an
application is not cured pursuant to subsection 2, written notice of the entry
of an order refusing a license to a trust company must be served personally or
sent by certified mail to the company affected. The company, upon application,
is entitled to a hearing before the Commissioner, but if no such application is
made within 30 days after the entry of an order refusing a license to any
company, the Commissioner shall enter a final order.
4. The order of the Commissioner is final
for the purposes of judicial review.
(Added to NRS by 1969, 1186; A 1983, 1760; 1987, 1945; 1997, 1008; 1999, 846; 2003, 985; 2005, 1850; 2009, 1958;
2011, 2594)
NRS 669.190 Payment of license fees; regulations; deposit in State Treasury.
1. The initial fee to be paid for a retail
trust company license must not be more than $3,000.
2. In addition, every retail trust company
must pay an initial license fee of not more than $500 for each branch office
that is authorized by the Commissioner.
3. Thereafter, every retail trust company
must pay annually on or before April 1 of each year a license fee of not more
than $3,000.
4. The Commissioner shall adopt
regulations establishing the amount of the fees required pursuant to this
section. All money collected under the provisions of this section must be
deposited in the State Treasury pursuant to the provisions of NRS 658.091.
(Added to NRS by 1969, 1187; A 1983, 1317, 1761; 1987, 1945; 1997, 1008; 2003, 3227; 2005, 1851; 2009, 1960)
NRS 669.200 Cancellation of license if retail trust company fails to open
for business or maintain regular business hours. The
Commissioner shall issue an order cancelling a retail trust company’s license:
1. If the proposed retail trust company
fails to open for business within 6 months after the date the license was
issued, or within an additional 6-month extension granted by the Commissioner
upon written application and for good cause shown; or
2. If the retail trust company fails to
maintain regular business hours or otherwise conduct the business of a trust
company for more than 30 days.
(Added to NRS by 1969, 1187; A 1983, 1761; 1987, 1946; 2009, 1960)
POWERS AND MISCELLANEOUS PROVISIONS
NRS 669.210 Powers of retail trust companies; banking business prohibited.
1. Each retail trust company may, in the
conduct of its trust business, within and outside this State, subject to NRS 669.092, as applicable:
(a) Act as indenture trustee or as trustee under
any mortgage or bond of any person or of any municipality or body politic.
(b) Accept and execute any municipal or corporate
or individual trust not inconsistent with the laws of this State.
(c) Act under the order or appointment of any
court as guardian, administrator, receiver or trustee.
(d) Act as executor or trustee under any will.
(e) Act as fiscal or transfer agent of any state,
municipality, body politic or corporation, and in such capacity receive and
disburse money and register, transfer and countersign certificates of stock,
bonds and other evidences of indebtedness.
(f) Act as a registered agent of foreign
corporations.
(g) Accept and execute any trust business
permitted by any law.
(h) Acquire the fiduciary rights, powers, duties
and liabilities of a bank, savings and loan association, thrift company, trust
company or credit union licensed pursuant to titles 55 and 56 of NRS, and upon
the effective date of such an acquisition, the fiduciary rights, powers, duties
and liabilities of the bank, savings and loan association, thrift company,
trust company or credit union vest in and must be performed by the acquiring
trust company.
(i) Act as an agent, advisory agent, assignee,
attorney-in-fact, authenticating agent, bailee, bond or indenture trustee,
conversion agent, curator, custodian, escrow agent, exchange agent, fiscal or
paying agent, financial adviser, investment adviser, investment manager,
managing agent, purchase agent, registrar, safekeeping agent, subscription
agent, warrant agent or in similar capacities generally performed by corporate
trustees, and in so acting, may possess, purchase, sell, invest, reinvest,
safekeep or otherwise manage or administer real or personal property of other
persons.
(j) Exercise the powers of a business corporation
or limited-liability company organized or qualified as a foreign corporation or
limited-liability company under Nevada law and any incidental powers that are
reasonably necessary to enable it to fully exercise, in accordance with
commonly accepted customs and usages, a power conferred in this chapter.
(k) Do and perform all acts necessary to exercise
the powers enumerated in this subsection and authorized by this chapter and any
other applicable laws of this State.
2. A retail trust company may not engage
in any banking business by accepting deposits or making loans.
(Added to NRS by 1969, 1187; A 1989, 2033; 2007, 2725; 2009, 1960)
NRS 669.220 Investments: General requirements.
1. A retail trust company:
(a) Shall keep all trust funds and investments
separate from the assets of the retail trust company, and all investments made
by the retail trust company as a fiduciary must be designated so that the trust
or estate to which the investments belong may be clearly identified.
(b) When it holds trust funds awaiting investment
or distribution, may deposit or leave those funds on deposit with a state or
national bank or credit union. The funds must not be deposited or left with the
same corporation depositing them or leaving them on deposit, or with a
corporation or association holding or owning a majority of the stock of the
retail trust company making or leaving the deposit, unless that corporation or
association first pledges, as security for the deposit, securities eligible for
investment by state banks or credit unions which have a market value equal to
that of the deposited funds. No security is required with respect to any
portion of the deposits that is insured under the provisions of NRS 678.755 or a law of the United States.
(c) When it acts in any capacity under a court
trust or private trust, unless the instrument creating the trust provides
otherwise, may cause any securities or other assets held by it in its
representative capacity to be registered or titled in the name of a nominee or
nominees of the retail trust company.
(d) When acting as depositary or custodian for
the personal representative of a court trust or private trust, unless the
instrument creating the trust provides otherwise, may with the consent of the
personal representative of the trust, cause any securities or other assets held
by it to be registered or titled in the name of a nominee or nominees of the
retail trust company.
2. A trust company is liable for any loss
occasioned by the acts of its nominees with respect to securities registered
under this section.
3. No corporation or the registrar or
transfer agent of the corporation is liable for registering or causing to be
registered on the books of the corporation any securities in the name of any
nominee of a trust company or for transferring or causing to be transferred on
the books of the corporation any securities registered by the corporation in
the name of any nominee of a trust company when the transfer is made on the
authorization of the nominee.
4. The assets forming the capital of a
retail trust company must:
(a) Be cash, governmental obligations or insured
deposits that mature within 3 years after acquisition, readily marketable
securities or other liquid, secure assets, bonds, sureties or insurance, or
some combination of the foregoing in accordance with NRS
669.100.
(b) Have an aggregate market value that equals or
exceeds 100 percent of the company’s required stockholders’ equity.
5. A retail trust company may purchase or
rent real or personal property useful for the conduct of the business and other
activities of the retail trust company.
6. A retail trust company may invest its
money for its own account, other than those required or permitted to be
maintained by subsection 4 or 5 or NRS 669.100, in
any type or character of equity securities, debt securities or other asset,
provided the investment complies with the prudent investor standards of NRS 164.700 to 164.775, inclusive.
(Added to NRS by 1969, 1187; A 1983, 299; 1997, 1009; 1999, 847, 1544; 2009, 1961)
NRS 669.225 Investments: Trust company may invest in securities and provide
services to investment trust or investment company; retail trust company may
deposit money held in trust with affiliate.
1. In addition to the powers of investment
granted to the trust company by the instrument creating the relationship of
fiduciary or agent, a trust company which is acting as a fiduciary or agent
may, in its discretion or at the direction of another person who is authorized
to direct the investment of money held by the trust company as a fiduciary or
agent, invest in the securities of an investment trust or investment company
if:
(a) The investment trust or investment company is
an investment company for the purposes of the Investment Company Act of 1940,
as amended, 15 U.S.C. §§ 80a-1 et seq.;
(b) The portfolio of the investment trust or
investment company consists substantially of investments which are not
prohibited by the instrument creating the fiduciary or agency relationship; and
(c) The relationship of the investment company to
the trust company is disclosed to any person who is currently receiving
statements for the account, by a prospectus, a statement of account or
otherwise.
2. A retail trust company or an affiliate
of the retail trust company that provides services to the investment trust or
investment company, including, without limitation, acting as an adviser,
custodian, transfer agent, registrar, sponsor, distributor or shareholder
serving agent manager, may receive reasonable compensation for the services.
The manner in which the compensation is calculated must be disclosed to any
person who is currently receiving statements for the account by a prospectus, a
statement of account or otherwise.
3. A retail trust company may deposit
money held by the retail trust company as a fiduciary or agent that is awaiting
investment or distribution as provided in the governing instrument for the
account in an affiliated bank. To the extent that the money invested in an
affiliated bank is not insured by the Federal Deposit Insurance Corporation,
the retail trust company shall set aside collateral as security, under the
control of appropriate fiduciary officers and employees, with a market value
that at all times equals or exceeds the amount of the uninsured fiduciary
money.
4. Notwithstanding subsections 1, 2 and 3,
a retail trust company authorized to exercise trust powers in this State which
is acting as a fiduciary shall not purchase for the fiduciary estate any fixed
income or equity security issued by the retail trust company or an affiliate
thereof other than an investment company, unless:
(a) The retail trust company is expressly
authorized to do so by the terms of the instrument creating the trust, a court
order, the written consent of the grantor of the trust or the written consent
of every adult beneficiary of the trust who, at the time the notice is
provided, receives, or is entitled to receive, income under the trust or who
would be entitled to receive a distribution of principal if the trust were
terminated; or
(b) The security is fairly priced and otherwise
complies with the prudent investor standards of NRS 164.700 to 164.775, inclusive, and the terms of the
instrument, judgment, decree, or other document establishing the fiduciary
relationship.
(Added to NRS by 1991, 822; A 1999, 848; 2009, 1962)
NRS 669.230 Discontinuing business. Whenever
any trust company desires to discontinue its trust business, it shall furnish
to the Commissioner satisfactory evidence of its release and discharge from all
the obligations and trusts which it has assumed or which have been imposed by
law. Thereafter, the Commissioner shall enter an order cancelling the trust
company’s license.
(Added to NRS by 1969, 1188; A 1983, 1761; 1987, 1946)
NRS 669.240 Fidelity bonds; insurance.
1. The directors or managers of a trust
company shall require good and sufficient fidelity bonds in the amount of
$25,000 or more on all active officers, managers, members acting in a
managerial capacity and employees, whether or not they receive a salary or
other compensation from the trust company, to indemnify the trust company
against loss because of any dishonest, fraudulent or criminal act or omission
by any of the persons bonded acting alone or in combination with any other
person. The bonds may be in any form and may be paid for by the trust company.
2. The trust company shall obtain suitable
insurance against burglary, robbery, theft and other hazards to which it may be
exposed in the operation of its business.
3. The trust company shall at least
annually prescribe the amount or penal sum of the bonds or policies and designate
the sureties and underwriters thereof, after giving due and careful
consideration to all known elements and factors constituting a risk or hazard.
The action must be recorded in the minutes of the trust company and reported to
the Commissioner.
(Added to NRS by 1969, 1188; A 1983, 300, 1762; 1987, 1946; 1999, 848)
NRS 669.245 Commissioner authorized to be signatory. The Commissioner is authorized to be, on his
or her own behalf and that of the Division of Financial Institutions, a
signatory to the Nationwide Cooperative Agreement for Supervision and
Examination of Multi-State Trust Institutions as adopted by the Conference of
State Bank Supervisors and exercise his or her discretion in the supervision of
multi-state trust institutions consistently with that agreement.
(Added to NRS by 2009, 1952)
EXAMINATION; REGULATION
NRS 669.250 Fees for examination; frequency of examination.
1. For each examination of a trust
company’s books and records required or authorized under this chapter, the
Commissioner shall charge and collect from the trust company a fee for
conducting the examination and in preparing and typing the report of the
examination at the rate established pursuant to NRS 658.101.
2. All money collected under this section
must be deposited in the State Treasury pursuant to the provisions of NRS 658.091.
3. The Commissioner shall examine a
licensee as often as the Commissioner deems necessary.
(Added to NRS by 1969, 1188; A 1983, 1318, 1762; 1987, 1946, 2223; 2003, 3228)
NRS 669.260 Applicability of other provisions of title. In addition to other provisions of this title
which are applicable to this title as a whole or specifically made applicable
to trust companies, the Commissioner may by regulation make applicable to trust
companies any regulatory provision contained in chapters 657 to 667, inclusive,
which can be reasonably applied and which are not inconsistent with the
provisions of this chapter.
(Added to NRS by 1969, 1189; A 1983, 1762; 1987, 1947)
NRS 669.270 Regulations of Commissioner. The
Commissioner may adopt such regulations as may be necessary to carry out the
purposes and provisions of this chapter.
(Added to NRS by 1969, 1189; A 1983, 1762; 1987, 1947)
NRS 669.275 Commissioner authorized to require audited financial statement;
submission of list of stockholders or members.
1. The Commissioner may require a licensee
to provide an audited financial statement prepared by an independent certified
public accountant licensed to do business in this State.
2. On the fourth Monday in January of each
year, each licensee shall submit to the Commissioner a list of stockholders
required to be maintained pursuant to paragraph (c) of subsection 1 of NRS 78.105 or the list of members required
to be maintained pursuant to paragraph (a) of subsection 1 of NRS 86.241, verified by the president or a
manager, as appropriate.
3. The list of members required to be
maintained pursuant to paragraph (a) of subsection 1 of NRS 86.241 must include the percentage of
each member’s interest in the company, in addition to the requirements set
forth in that section.
4. Except as otherwise provided in NRS 239.0115, any document submitted
pursuant to this section is confidential.
(Added to NRS by 2009, 1952)
DISCIPLINARY ACTION AND REMEDIAL ACTION
NRS 669.280 Authority of Commissioner to take disciplinary action and to
close and liquidate business.
1. The violation of any of the provisions
of this chapter by the officers or directors, or the managers or members acting
in a managerial capacity, of any trust company is sufficient cause for the
Commissioner to close the trust company, liquidate its business and revoke its
license.
2. If a trust company or any person
authorized to act on the behalf of the trust company refuses to allow the
Commissioner or the Commissioner’s deputies to inspect all books, records,
papers and effects of the business of the trust company, the Commissioner may
revoke its license and proceed to wind up the affairs of the trust company.
(Added to NRS by 1969, 1189; A 1983, 1762; 1987, 1947; 1999, 849)
NRS 669.281 Authority of Commissioner to remove officer, director, manager
or employee of retail trust company; appeal of removal; hearing; judicial
review.
1. The Commissioner may require the
immediate removal from office of any officer, director, manager or employee of
any retail trust company doing business under this chapter who is found to be
dishonest, incompetent or reckless in the management of the affairs of the
retail trust company, or who persistently violates the laws of this State or
the lawful orders, instructions and regulations issued by the Commissioner.
2. An officer, director, manager or
employee of a retail trust company who is removed from office pursuant to
subsection 1 may appeal his or her removal by filing a written request for a
hearing with the Commissioner within 10 days after the effective date of his or
her removal. The Commissioner shall conduct the hearing after providing at
least 5 days’ written notice to the retail trust company and the officer,
director, manager or employee who is removed from office. Within 5 days after
the hearing, the Commissioner shall enter an order affirming or disaffirming
the removal of the person from office. An order of the Commissioner entered
pursuant to this subsection is final for the purposes of judicial review.
(Added to NRS by 2009, 1954;
A 2011,
2595)
NRS 669.2825 Authority of Commissioner to take disciplinary action or
initiate proceedings to seize property.
1. The Commissioner may institute
disciplinary action or forthwith initiate proceedings to take possession of the
business and property of any retail trust company when it appears that the
retail trust company:
(a) Has violated its charter or any state or
federal laws applicable to the business of a trust company.
(b) Is conducting its business in an unauthorized
or unsafe manner.
(c) Is in an unsafe or unsound condition to
transact its business.
(d) Has an impairment of its stockholders’
equity.
(e) Has refused to pay or transfer account assets
to its account holders as required by the terms of the accounts’ governing
instruments.
(f) Has become insolvent.
(g) Has neglected or refused to comply with the
terms of a lawful order of the Commissioner.
(h) Has refused, upon proper demand, to submit
its records, affairs and concerns for inspection and examination of an
appointed or authorized examiner of the Commissioner.
(i) Has made a voluntary assignment of its assets
to receivers, conservators, trustees or creditors without complying with NRS 669.230.
(j) Has failed to pay a tax as required pursuant
to the provisions of chapter 363A of NRS.
(k) Has materially and willfully breached its
fiduciary duties to its customers.
(l) Has failed to properly disclose all fees,
interest and other charges to its customers.
(m) Has willfully engaged in material conflicts
of interest regarding a customer’s account.
(n) Has made intentional material
misrepresentations regarding any aspect of the services performed or proposed
to be performed by the retail trust company.
2. The Commissioner also may forthwith
initiate proceedings to take possession of the business and property of any
trust company when it appears that the officers of the trust company have
refused to be examined upon oath regarding its affairs.
(Added to NRS by 2009, 1954)
NRS 669.283 Authority of Commissioner to investigate.
1. For the purpose of discovering violations
of this title or of securing information required under this chapter, the
Commissioner or the Commissioner’s duly authorized representatives may at any
time investigate the business and examine the books, accounts, papers and
records used therein of:
(a) Any licensee;
(b) Any other person engaged in an activity for
which a license is required pursuant to the provisions of this chapter; and
(c) Any person that the Commissioner has
reasonable cause to believe is violating or is about to violate any provision
of this chapter, whether or not the person claims to be within the authority or
beyond the scope of this chapter.
2. For the purpose of examination, the
Commissioner or the Commissioner’s authorized representatives must have and be
given free access to the offices and places of business, files, safes and
vaults of such persons.
3. The Commissioner may require the
attendance of any person and examine the person under oath regarding:
(a) Any transaction or business regulated
pursuant to the provisions of this chapter; or
(b) The subject matter of any audit, examination,
investigation or hearing.
(Added to NRS by 2009, 1953)
NRS 669.2845 Revocation of license; notice and hearing required. If the Commissioner finds that probable cause
for revocation of any license exists and that enforcement of the provisions of
this chapter requires immediate suspension of a license pending investigation,
the Commissioner may, upon 5 days’ written notice and a hearing, enter an order
suspending a license for a period not exceeding 20 days, pending a hearing upon
the revocation.
(Added to NRS by 2009, 1954)
NRS 669.2846 Authority of Commissioner to issue cease and desist order;
action to enjoin by Attorney General or Commissioner; appointment of receiver.
1. Whenever the Commissioner has
reasonable cause to believe that any person is violating or is threatening to
or intends to violate any provision of this chapter, the Commissioner may, in
addition to all actions provided for in this chapter and without prejudice
thereto, enter an order requiring the person to desist or to refrain from such
violation.
2. The Attorney General or the
Commissioner may bring an action to enjoin a person from engaging in or
continuing a violation or from doing any act or acts in furtherance thereof. In
any such action, an order or judgment may be entered awarding a preliminary or
final injunction as may be deemed proper.
3. In addition to all other means provided
by law for the enforcement of a restraining order or injunction, the court in
which an action is brought may impound, and appoint a receiver for, the
property and business of the defendant, including books, papers, documents and
records pertaining thereto, or so much thereof as a court may deem reasonably
necessary to prevent violations of this chapter through or by means of the use
of property and business, whether such books, papers, documents and records are
in the possession of the defendant, a registered agent acting on behalf of the
defendant or any other person. A receiver, when appointed and qualified, has
such powers and duties as to custody, collection, administration, winding up
and liquidation of such property and business as may from time to time be
conferred upon the receiver by the court.
4. If a receiver is appointed pursuant to
subsection 3, such receiver shall remit to the owners, members or shareholders
of the retail trust company any amount of equity and capital of the retail
trust company remaining after discharge of the liabilities and payment of the
normal, prudent and reasonable expenses of the receivership.
(Added to NRS by 2009, 1954)
NRS 669.2847 Revocation or suspension of license; notice and hearing
required; administrative fines.
1. If the Commissioner has reason to
believe that grounds for revocation or suspension of a license exist, the
Commissioner shall give at least 20 days’ written notice to the licensee
stating the contemplated action and, in general, the grounds therefor and set a
date for a hearing.
2. At the conclusion of a hearing, the
Commissioner shall:
(a) Enter a written order dismissing the charges,
revoking the license or suspending the license for a period of not more than 60
days, which period must include any prior temporary suspension. The
Commissioner shall send a copy of the order to the licensee by registered or
certified mail.
(b) Impose upon the licensee an administrative
fine of not more than $10,000 for each violation by the licensee of any
provision of this chapter or any regulation adopted pursuant thereto.
(c) If a fine is imposed pursuant to this
section, enter such order as is necessary to recover the costs of the
proceeding, including his or her investigative costs and attorney’s fees.
3. The grounds for revocation or
suspension of a license are that:
(a) The licensee has failed to pay the annual
license fee;
(b) The licensee, either knowingly or without any
exercise of due care to prevent it, has violated any provision of this chapter
or any regulation adopted pursuant thereto or any lawful order of the Division
of Financial Institutions;
(c) The licensee has failed to pay a tax as
required pursuant to the provisions of chapter
363A of NRS;
(d) Any fact or condition exists which would have
justified the Commissioner in denying the licensee’s original application for a
license pursuant to the provisions of this chapter; or
(e) The licensee:
(1) Failed to open an office for the
conduct of the business authorized by his or her license within 180 days after
the date the license was issued; or
(2) Has failed to remain open for the
conduct of the business for a period of 30 days without good cause therefor.
4. An order suspending or revoking a
license becomes effective 5 days after being entered unless the order specifies
otherwise or a stay is granted.
(Added to NRS by 2009, 1955)
NRS 669.285 Confidentiality of records and documents. Except as otherwise provided in NRS 239.0115, any application and
personal or financial records submitted by a person pursuant to the provisions
of this chapter and any personal or financial records or other documents
obtained by the Division of Financial Institutions pursuant to an examination
or audit conducted by the Division are confidential and may be disclosed only
to:
1. The Division, any authorized employee
of the Division and any state or federal agency investigating the activities
covered under the provisions of this chapter; and
2. Any person when the Commissioner, in
the Commissioner’s discretion, determines that the interests of the public that
would be protected by disclosure outweigh the interest of any person in the
confidential information not being disclosed.
(Added to NRS by 2009, 1952)
UNLAWFUL ACTS; PENALTIES
NRS 669.286 Failure to submit required report; fees; regulations.
1. If a trust company fails to submit any
report required pursuant to this chapter or any regulation adopted pursuant
thereto within the prescribed period, the Commissioner may impose and collect a
fee of not more than $10 for each day the report is overdue.
2. The Commissioner shall adopt
regulations establishing the amount of the fee that may be imposed pursuant to
this section.
(Added to NRS by 2005, 1849)
NRS 669.290 Willful neglect to perform duties imposed by law or failure to
conform to material lawful requirement made by Commissioner unlawful; penalty. Each officer, director, manager, member,
employee or agent of a trust company who knowingly or willfully neglects to
perform any duty required by this chapter or other applicable law, or who
knowingly or willfully fails to conform to any material lawful requirement made
by the Commissioner, is subject to removal upon order of the Commissioner, and
is guilty of a category D felony and shall be punished as provided in NRS 193.130.
(Added to NRS by 1969, 1189; A 1983, 1763; 1987, 1947; 1995, 1317; 1999, 849)
NRS 669.295 Administrative fines.
1. In addition to any other remedy or penalty,
the Commissioner may impose an administrative fine of not more than $10,000 per
violation upon a person who:
(a) Without a license, conducts any business or
activity for which a license is required pursuant to the provisions of this
chapter; or
(b) Violates any provision of this chapter or any
regulation adopted pursuant thereto.
2. The maximum total fine that the
Commissioner may impose on any person pursuant to this section with respect to
the same or similar actions or series of actions which constitute the
violations must not exceed the greater of $100,000 or 125 percent of all losses
incurred by the retail trust company and its clients as the direct or indirect
result of such violations.
(Added to NRS by 2005, 1849; A 2009, 1963)
NRS 669.300 Violation of chapter constitutes gross misdemeanor unless
otherwise specified. Where no
other punishment is otherwise provided by law, any person violating any
provision of this chapter is guilty of a gross misdemeanor.
(Added to NRS by 1969, 1189)
