Nebraska Department of Banking and Finance

Overview

Regulator Type: Official State Banking Regulator

Primary Authority: Nebraska Money Transmitters Act (Nebraska Revised Statutes Chapter 8, Article 27-28)

The Nebraska Department of Banking and Finance (NDBF) is the official state banking regulator responsible for licensing, supervising, and enforcing compliance among money transmitters and other financial service providers operating in Nebraska. Under the authority of the Nebraska Money Transmitters Act and the Nebraska Financial Innovation Act, the Department serves as the primary regulatory body overseeing money transmission activities within the state.

The Department is directed by Kelly Lammers, Director, who was appointed by the Governor. The NDBF operates as part of Nebraska's regulatory framework to protect consumers, maintain the integrity of the financial system, and promote financial innovation while ensuring compliance with state and federal requirements.

Key Regulatory Focus Areas:

• Money transmission licensing and oversight
• Digital asset depository institutions (financial innovation)
• Consumer protection and complaint resolution
• Anti-money laundering (AML) and Know Your Customer (KYC) compliance
• Authorized delegate supervision
• Interstate coordination with other state regulators

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

Examination Framework

The NDBF employs a networked supervision approach to regulation:

• Coordination Model: Leverages cooperation with other state agencies and federal regulators
• Information Sharing: Enters into information sharing agreements with other state and federal agencies
• Cost Efficiency: Coordinates examinations to reduce regulatory burden while maintaining oversight
• Joint Reviews: Utilizes cooperative multistate approach for application reviews

Supervision Methodology

The Department:

• Conducts regular examinations of licensed money transmitters
• Reviews authorized delegate operations and compliance
• Monitors financial condition and capital adequacy
• Assesses AML/KYC program effectiveness
• Reviews consumer complaint patterns

Authorized Delegate Oversight

Before a licensee is authorized to conduct business through an authorized delegate, the licensee must:

1. Adopt and Implement written policies and procedures for delegate management
2. Execute written contracts with each authorized delegate
3. Conduct a reasonable, risk-based background investigation of the delegate
4. Maintain ongoing supervision and records of delegate activities
5. Ensure compliance with all applicable laws and regulations

Statutory Consumer Protection Requirements

Money transmitters licensed in Nebraska must comply with the following consumer protection obligations:

1. Fee and Rate Disclosure

• Clearly disclose all fees associated with transmission
• Clearly disclose exchange rates (if applicable)
• Provide disclosures before transaction

1. Transaction Receipts

• Issue receipts for all money transmission transactions
• Receipts must include relevant transaction details
• Requires verification from official sources Specific receipt content requirements Requires verification from official sources

1. Transaction Limits

• Comply with daily transaction limits [UNVERIFIED - specific limits not verified]
• Consumer-protective safeguards for high-value transfers

1. Refund and Dispute Resolution

• Offer refunds for fraudulent transactions
• Provide mechanism for consumer disputes
• Responsive customer service requirements Requires verification from official sources

1. Data Protection

• Comply with Financial Data Protection & Consumer Notification of Data Security Breach Act of 2006
• Secure customer personal information
• Notify customers of data breaches meeting statutory thresholds

Complaint Resolution

The Department:

• Investigates consumer complaints against state-chartered and licensed entities
• Maintains a Consumer Hotline: (877) 471-3445
• Operates online complaint filing system at ndbf.nebraska.gov/consumers/complaints

Regulatory Powers

Available Enforcement Actions

The Director has authority to pursue the following enforcement remedies:

1. Cease and Desist Orders

• Issued to halt violations of the Money Transmitters Act
• Enforceable through court action

1. Consent Orders

• Negotiated settlement agreements
• Often includes corrective action plans and monitoring

1. Administrative Penalties and Fines

• Assessed for violations of the Money Transmitters Act
• Amount determined based on violation severity

1. License Actions

• Denial of applications
• Suspension or revocation of licenses
• Conditions or restrictions on licenses

1. Temporary Restraining Orders (TRO)

• Available against unlicensed persons engaged in money transmission
• Obtained through court proceedings

1. Civil Penalties

• Available for knowingly violating the Act
• Additional liability for damages

Violation Standards

The Director may pursue enforcement when a licensee:

• Violates any provision of the Money Transmitters Act
• Fails to comply with Department orders or rules
• Provides false or misleading information
• Engages in unsafe or unsound practices
• Violates consumer protection requirements

Regulatory Role and Function

Legal Foundation

Primary Statutes and Acts

The NDBF derives its authority from multiple legislative frameworks:

1. Nebraska Money Transmitters Act (Nebraska Revised Statutes Chapter 8, Articles 27-28, §§ 8-2716 to 8-2745)

• Defines money transmission and money transmitter
• Establishes licensing requirements and procedures
• Grants enforcement powers to the Director
• Specifies financial and operational requirements

1. Nebraska Financial Innovation Act (Nebraska Revised Statutes Chapter 8, Article 30, §§ 8-3001 to 8-3031)

• Effective: October 1, 2021
• Creates charter for digital asset depository institutions
• Permits state-chartered banks to operate digital asset divisions
• Amended by LB 92 (effective June 7, 2023)

1. Recent Legislative Updates

• LB 474 (signed May 20, 2025; effective October 1, 2025)
• Updates Nebraska Money Transmitters Act
• Enhances state-to-state regulatory uniformity
• Improves Department's ability to regulate the money transmission industry
• Imposes heightened compliance and documentation requirements

Definition of Money Transmission

Per Nebraska law, money transmission is defined as "the business of the sale or issuance of payment instruments or stored value or of receiving money or monetary value for transmission to a location within or outside the United States by any and all means, including wire, facsimile, or electronic transfer."

This definition extends to:

• Persons providing money transmission services to any Nebraska resident, even without physical presence in the state
• Both intrastate and interstate/international transmission
• Any means of transmission (wire, electronic, etc.)

Director's Authority and Powers

The Director of the Nebraska Department of Banking and Finance is granted broad regulatory and enforcement powers:

• Licensing Authority: Authority to issue, deny, renew, suspend, or revoke money transmitter licenses
• Examination and Supervision: Power to conduct examinations of licensees and authorized delegates
• Rule-Making: Authority to adopt rules and regulations implementing the Money Transmitters Act
• Enforcement: Authority to issue cease and desist orders, consent orders, and pursue penalties
• Legal Relief: Power to obtain temporary restraining orders against unlicensed persons engaged in money transmission
• Administrative Fines: Authority to assess administrative penalties for violations

Licensing and Authorization Relevance

License Requirement

Statutory Requirement: A person shall not engage in money transmission without a license issued pursuant to the Nebraska Money Transmitters Act. This requirement applies to all money transmitters servicing Nebraska residents, regardless of physical location.

Application Process and NMLS

System: Nebraska utilizes the Nationwide Multistate Licensing System (NMLS) for all money transmitter license applications and renewals.

Steps:

1. Register with NMLS (www.nmls.us)
2. Complete NMLS application
3. Submit required documentation
4. Provide surety bond documentation (signed forms and power of attorney)
5. Submit application fee and processing fees
6. Undergo background investigation and review

License Characteristics

• License Term: One (1) year
• Renewal Deadline: December 31 of each calendar year
• Renewal: Online through NMLS
• Status: Non-transferable and non-assignable [UNVERIFIED - statutory requirement]
• Cost: $1,000 application fee (plus surety bond premium and government fees)

Important Renewal Rule

Nebraska does not allow reinstatement of an expired money transmitter license. Licensees must renew before the December 31 expiration date to maintain legal status.

Net Worth Requirement

Minimum Net Worth: $50,000

• Must be demonstrated according to Generally Accepted Accounting Principles (GAAP)
• Applicants must provide audited or unaudited financial statements
• Applies to the principal applicant/licensee

Surety Bond Requirements

Primary Bond: $100,000 minimum

Additional Location Coverage:

• $5,000 per additional location beyond the first
• Maximum aggregate bond requirement: $250,000

Bond Specifications:

• Must be issued by a surety company authorized to conduct business in Nebraska
• Must cover all licensed locations
• Bond documentation must be submitted electronically via NMLS
• Requires signatures from both surety company and licensee representative

Application Costs:

• Application fee: $1,000
• Estimated surety bond premium: $2,500 (varies by insurer and risk assessment)
• Additional government/processing fees apply

Digital Asset Regulatory Framework

The NDBF has taken a leadership role in digital asset regulation through the Nebraska Financial Innovation Act, establishing Nebraska as a hub for blockchain and crypto innovation.

Digital Asset Depository Institutions

Authorization: The Nebraska Financial Innovation Act creates a new charter class for "digital asset depository institutions."

Characteristics:

• State-level charter (distinct from federal OCC charter)
• Permits digital asset custody and management
• Allows associated financial services (lending, deposits, stablecoin issuance)
• Subject to NDBF supervision and examination

First Charter Issued:

• Institution: Telcoin Digital Asset Bank
• Date: Approved by Governor Jim Pillen and Director Kelly Lammers (November 2025)
• Status: First regulated digital asset bank charter in the United States
• Authorized Activities:
• Stablecoin issuance (eUSD)
• Cryptocurrency-linked deposits and loans
• Payment rail connectivity

State-Chartered Bank Digital Asset Divisions

The Act permits existing state-chartered banks to:

• Establish digital asset divisions
• Custody and manage digital assets
• Engage in blockchain-related activities
• Comply with NDBF examination standards

Regulatory Oversight

• Rules and regulations continue to be developed
• AML/CFT and OFAC examination procedures established
• Coordinated with federal authorities where applicable
• Designed to balance innovation with consumer protection

Crypto and Virtual Currency Oversight

Regulatory Approach: [UNVERIFIED - comprehensive virtual currency money transmitter guidance not verified]

• Digital assets may constitute "stored value" under Money Transmitters Act
• Crypto-to-fiat transmission may require money transmitter license
• Department developing specific guidance on crypto-related activities

Contact for Fintech Inquiry:

[email protected]

Payments and Money Movement Relevance

The Nebraska Department of Banking and Finance has the following relevance to payments and money movement in United States:

Payment Systems Governed or Overseen

The Nebraska Department of Banking and Finance does not directly operate payment systems. Its payment-related role includes:

Money transmitters, payment processors, and fintech companies operating in this jurisdiction require licensing or registration with this entity.

Relationship to Other Regulators

Multistate Money Services Businesses Licensing Agreement (MMLA)

Program Status: Nebraska Department of Banking and Finance participates in the MMLA.

Benefits:

• Streamlined multistate licensing process
• Unified application procedures among participating states
• Reduced compliance burden for interstate MSBs
• Coordinated examination frameworks

Eligibility: Particularly beneficial for money transmitters seeking licensure in five (5) or more states.

Federal and State Coordination

The Department:

• Enters into information sharing agreements with other state regulators
• Coordinates with federal agencies (FinCEN, OCC, Federal Reserve)
• Participates in state banking regulatory forums
• Implements uniform standards where appropriate
• Maintains relationships with neighboring state regulators

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Contact Information

Nebraska Department of Banking and Finance

Physical Address:

1526 K Street, Suite 300

Lincoln, NE 68508

Mailing Address:

P.O. Box 95006

Lincoln, NE 68508

Phone Numbers:

• Financial Institutions Division: (402) 471-2171
• Bureau of Securities: (402) 471-3445
• Consumer Hotline: (877) 471-3445

Website:

https://ndbf.nebraska.gov

Email for Digital Assets Inquiries:

[email protected]

Leadership

Director: Kelly Lammers

• Title: Director, Nebraska Department of Banking and Finance
• Appointed by: Governor of Nebraska
• Experience: Nearly four decades in banking and financial services

Key Resources

On Official Website (ndbf.nebraska.gov):

• Money Transmitter License Information: https://ndbf.nebraska.gov/industries/money-transmitter-license
• Money Transmitter Forms: https://ndbf.nebraska.gov/industries/money-transmitter-forms
• Nebraska Money Transmitters Act: https://ndbf.nebraska.gov/industries/nebraska-money-transmitters-act
• Digital Assets: https://ndbf.nebraska.gov/industries/digital-assets
• Consumer Complaints: https://ndbf.nebraska.gov/consumers/complaints
• Guidance Documents: https://ndbf.nebraska.gov/guidance-documents
• News & Publications: https://ndbf.nebraska.gov/about/news-publications

Statutory Resources:

• Nebraska Revised Statutes Chapter 8, Articles 27-28 (Money Transmitters Act)
• Nebraska Revised Statutes Chapter 8, Article 30 (Financial Innovation Act)
• Available via: https://nebraskalegislature.gov

Notes on Naming and Language