Alaska Division of Banking and Securities

Overview

The Alaska Division of Banking and Securities (DBS) is the official state financial regulator operating under Alaska's Department of Commerce, Community, and Economic Development. This division exercises binding regulatory authority over state-chartered banks, credit unions, and money services businesses operating within Alaska. Established prior to Alaska's statehood in 1959 and subsequently reorganized, the DBS provides comprehensive oversight of the state's financial services industry and protects consumers through prudential regulation and enforcement.

Historical Context

The Division of Banking and Securities has roots extending back before Alaska's admission to the Union as a state in 1959. Following statehood, banking regulation was reorganized into the modern Division structure, which consolidated oversight of banking, securities, and consumer finance. The division's history reflects Alaska's commitment to maintaining financial stability and regulatory coordination across all financial service sectors.

Regulatory Authority

Under the Alaska Uniform Money Services Act (Alaska Statutes Title 6, Chapter 55), the DBS exercises binding regulatory authority over money transmitters, money order issuers, stored value card issuers, and currency exchangers—collectively known as money services businesses. This authority encompasses licensing, examination, enforcement, and ongoing supervision of all entities engaged in money transmission within Alaska's jurisdiction.

Basic Identity

Document Type: Official Regulator Profile

Regulatory Authority Level: State (Binding)

Last Updated: April 5, 2025

Data Confidence: 95%

Compiled From: Official regulatory sources, statutory text, and regulatory authority publications

Classification

Inclusion Justification

What This Entity Oversees

Jurisdictional Scope

Geographic Coverage: Entire State of Alaska

Entity Types Overseen: Money transmitters, currency exchangers, money order issuers, stored value card issuers, payment instrument providers

Primary Service Area: Alaska (AK)

Regulatory Authority and Statutes

Primary Governing Statute

Alaska Uniform Money Services Act

• Citation: Alaska Statutes Title 6, Chapter 55 (AS 06.55)
• Effective Date: Comprehensive regulatory framework
• Authority Granted: Full regulatory authority over money transmission activities, licensing, examination, enforcement
• Framework: Adopts substantial portions of the UMSA (Uniform Money Services Act) model

Key Statutory Components

Organization (AS 06.55.001-06.55.050)

• Division of Banking and Securities designated as regulatory authority
• Commissioner/Director appointed by Governor
• Examination and rule-making authority
• Confidentiality requirements for regulatory information

Money Transmission Licenses (AS 06.55.101-06.55.116)

Definitions (AS 06.55.101)

• Money Transmission: Selling or issuing payment instruments; receiving money or monetary value for transmission; engaging in money transmission business
• Payment Instrument: Checks, drafts, money orders, traveler's checks, or similar instruments
• Stored Value: Monetary value stored on medium
• Monetary Value: Any medium of exchange, including virtual currency

License Requirement (AS 06.55.103)

• Person may not engage in money transmission or hold itself out as providing money transmission unless:
• Licensed under this chapter, OR
• Authorized delegate of a licensed person
• Violations subject to civil and criminal penalties

Net Worth (AS 06.55.107)

• Money transmission licensee must maintain net worth of at least $25,000
• Net worth determined under Generally Accepted Accounting Principles (GAAP)
• Documentation required in application and renewal

Surety Bond (AS 06.55.108)

• Licensee must maintain surety bond or letter of credit
• Amount determined by Director
• Minimum coverage for outstanding obligations
• Bond must remain in effect throughout license period

Application Requirements (AS 06.55.104)

• Application submitted via NMLS
• Ownership and control structure information
• Financial statements and net worth documentation
• Business plan and operating procedures
• Authorized delegate agreements
• AML/compliance program documentation
• Background check authorization
• Information on other state licenses
• Disciplinary history disclosure

License Renewal (AS 06.55.109)

• Renewal Date: December 1 (annual)
• Application Deadline: As determined by Commissioner
• Renewal Requirements: Updated financial statements, ownership information, compliance certification, authorized delegate list
• Fee: Determined by administrative rule

Authorized Delegates (AS 06.55.115)

• Licensee may authorize qualified persons to act as agents
• Licensee maintains full responsibility for delegate compliance
• Delegates must meet fitness and propriety standards
• Delegates subject to Commission examination

Consumer Protection and Disclosure (AS 06.55.201-06.55.220)

• Licensee must disclose all fees and terms clearly
• Prohibition on fraud and deception
• Consumer complaint handling procedures
• Restitution authority for violations

Record-Keeping and Reports (AS 06.55.301-06.55.330)

• Maintain records of all money transmission transactions
• Customer identification and transaction documentation
• Retain records minimum 5 years
• Make records available to Commission upon request
• Transaction report requirements
• Customer notification requirements

Permissible Investments (AS 06.55.401-06.55.430)

• Requirements for maintaining customer funds
• Eligible investment vehicles
• Segregation requirements
• Restrictions on use of customer funds

Enforcement (AS 06.55.501-06.55.630)

• Commissioner examination authority
• Cease and desist authority
• License suspension and revocation
• Civil penalty authority
• Criminal penalty authority
• Restitution to consumers

Regulatory Powers

Examination and Supervision

Examination Authority

• Director Authority: Full power to examine money services businesses
• On-Site Examination: Risk-based examination program
• Records Access: Full access to all company records
• Personnel Interviews: Authority to interview employees and agents
• Facility Access: Right to inspect business locations

Examination Frequency

• Risk-Based Approach: Higher-risk entities examined more frequently
• Standard Entities: Annual or bi-annual examination typical
• Complaint-Triggered: Additional examination based on complaints

Examination Standards

• Financial condition and net worth verification
• Compliance program effectiveness
• AML/KYC implementation and effectiveness
• Customer fund protection and segregation
• Authorized delegate compliance
• Consumer complaint handling
• Technology and information security

Enforcement Actions

Cease and Desist Orders

• Authority: Director may issue orders to cease violative conduct
• Scope: Covers any violation of Chapter 55
• Duration: Remains in effect until compliance
• Enforcement: Violation of order subject to penalties

License Suspension

• Duration: Until compliance or revocation
• Grounds: Significant violations or financial issues
• Notification: Written notice to licensee
• Appeal: Administrative appeal available

License Revocation

• Finality: Permanent termination of license
• Timeline: 30+ days after final determination
• Business Cessation: Licensee must cease operations immediately
• Customer Claims: Surety bond available for claims

Civil and Criminal Penalties

• Civil Authority: Director may impose civil penalties
• Criminal Authority: Available for unlicensed operation
• False Statements: Criminal penalties for false information
• Enforcement: Referred to state attorney general

Consumer Complaint Resolution

Complaint Mechanism

• Submission: Online, telephone, or in-person
• Contact: Alaska Division of Banking and Securities
• Anchorage: (907) 269-8140 or (888) 925-2521
• Juneau: (907) 465-2521 or (888) 925-2521
• Process: Investigation and resolution
• Timeline: Timely response

Resolution Authority

• Investigation power over complaints
• Examination authority to investigate
• Restitution authority for affected consumers
• Enforcement action authority

Regulatory Role and Function

The Division of Banking and Securities operates as a division within the Alaska Department of Commerce, Community, and Economic Development and consists of three operational sections:

Banking Section

• Charters and examines state-chartered banks
• Regulates bank holding companies
• Supervises credit unions
• Oversees similar banking institutions

Consumer Finance Section

• Registers and licenses non-depository financial institutions
• Examines consumer finance companies
• Investigates consumer complaints
• Enforces consumer protection standards

Securities Section

• Examines and registers securities offerings
• Registers securities dealers and investment representatives
• Enforces securities laws
• Coordinates enforcement activities

Money Services Business Unit

• Licenses money transmitters and currency exchangers
• Licenses money order and stored value issuers
• Conducts examinations of money services businesses
• Investigates consumer complaints

Legal Foundation

Established by primary legislation enacted by the national legislature. The enabling statute defines the regulatory mandate, scope of authority, governance structure, and enforcement powers.

Licensing and Authorization Relevance

License Overview

License Name: Alaska Money Services Business License

Regulatory Body: Alaska Division of Banking and Securities

License Type: Standard commercial license

Entity Eligibility: Corporations, LLCs, partnerships, individuals

Reciprocity: NMLS multi-state reciprocity system

Application and Licensing Process

Pre-Application Requirements

1. NMLS Account Registration

• Create account in Nationwide Multistate Licensing System
• Obtain NMLS ID
• Complete beneficial ownership (BO) reporting

1. Organization and Compliance

• Establish legal entity in Alaska or jurisdiction of operations
• Develop comprehensive AML/compliance program
• Prepare audited or reviewed financial statements
• Draft operating procedures and authorized delegate agreements

Application Submission

• Method: Electronic submission via NMLS
• Platform: Nationwide Multistate Licensing System
• Required Documents:
• NMLS application form (completed electronically)
• Financial statements (audited for larger entities)
• Proof of net worth ($25,000 minimum)
• Surety bond commitment letter
• Ownership and control documentation
• Fingerprints and background authorization
• AML/compliance program documentation
• Sample customer contracts
• Authorized delegate agreements (if applicable)
• Business address verification

Application Review Timeline

• Standard Review: 30-60 days
• Complete Application: Required to commence review
• Deficiency Notice: If information incomplete
• Approval Decision: Written approval from DBS

Approval and Issuance

• Approval Method: NMLS notification + formal approval letter
• License Effective Date: Date of approval or requested date
• Initial License Term: Extends to December 1 of license year
• License Certificate: Issued via NMLS

Financial Requirements

Net Worth

• Minimum Requirement: $25,000
• Determination Method: Generally Accepted Accounting Principles (GAAP)
• Documentation: Audited financial statements or reviewed statements
• Verification: As part of application and annual renewal
• Ongoing Maintenance: Must maintain minimum at all times

Surety Bond or Letter of Credit

• Minimum Amount: Determined by Director
• Bond Type: Surety bond preferred; letter of credit acceptable
• Surety Provider: Alaska-licensed surety company
• Coverage Period: Throughout license period
• Continuous Requirement: Must maintain throughout operations
• Renewal: Bond must remain in force during renewal period

Alternative Financial Security

• Letter of credit from FDIC-insured bank
• Cash deposit (with Director restrictions)
• Other security acceptable to Director

Operating Requirements

Authorized Delegates

• Permitted: Yes, licensee may appoint authorized delegates
• Licensee Responsibility: Full liability for delegate conduct
• Delegate Fitness: Must meet character and fitness standards
• Delegate Agreement: Written agreement required
• Termination: Must comply with termination procedures

Delegate Reporting

• Initial Reporting: All delegates reported at application
• Status Updates: Reported within 30 days of change
• Annual Update: Confirmed in renewal application

Customer Fund Protection

• Funds received must be held in protected manner
• Segregated account requirement
• Prohibition on using customer funds except for transmission
• Accurate transaction record maintenance

AML and Compliance Program

• Written AML policy and procedures
• Customer Identification Program (CIP) implementation
• Enhanced Due Diligence (EDD) for high-risk customers
• Know Your Customer (KYC) procedures
• Suspicious activity monitoring and reporting
• OFAC sanctions compliance
• Transaction monitoring
• Staff training (annual minimum)

FinCEN Registration

• Form 107 filed with Financial Crimes Enforcement Network
• Required before commencing business
• Annual updates required
• Valid for 2 years

Transaction Records and Reporting

• Maintain minimum 5 years
• Include customer identification, amount, date, method
• Available for Division examination
• Annual compliance certification

License Renewal

Renewal Timeline

• Expiration Date: December 1 (annual)
• Application Deadline: As determined by Director (typically 60 days prior)
• Renewal Period: 1 year (December 2 - December 1)
• Late Application: License expires if not renewed on time

Renewal Documentation

• Updated balance sheet and income statement
• Updated audited financial statements (if applicable)
• Proof of continued net worth ($25,000 minimum)
• Surety bond renewal or continuation
• Authorized delegate updates
• Ownership structure certification
• AML/compliance program certification
• Continuing education documentation

Renewal Approval

• Review Process: Standard administrative review
• Approval Authority: Division of Banking and Securities
• Notification: NMLS and written confirmation
• Effective Date: December 2 of renewal year

Compliance Standards

Examination Standards

• Risk-Based Frequency: Periodic on-site and off-site examinations
• Examination Scope:
• Financial condition and safety
• Compliance program effectiveness
• AML/KYC procedures
• Customer fund protection
• Operational safeguards
• Management quality
• Technology systems

Cybersecurity and Data Protection

• Information security plan required
• Data breach notification procedures
• Incident response planning
• Customer data protection measures
• Disaster recovery and business continuity

Consumer Protection Standards

• Clear fee and term disclosure
• Complaint handling procedures
• Fair and transparent practices
• Fraud prevention
• Restitution authority for violations

Payments and Money Movement Relevance

The Alaska Division of Banking and Securities has the following relevance to payments and money movement in United States:

Payment Systems Governed or Overseen

The Alaska Division of Banking and Securities does not directly operate payment systems. Its role in payment infrastructure is indirect:

The entity's primary payment relevance is through oversight of post-trade infrastructure (clearing, settlement, and custody) rather than direct operation of payment systems.

Relationship to Other Regulators

NMLS Integration

• System Use: All licensing conducted via NMLS
• Multi-State Recognition: License recognized in all NMLS-participating states
• Reciprocal Registration: Simplified application in additional states
• Consumer Access: Public license verification via NMLS Consumer Access

Federal Coordination

• FinCEN Registration: Form 107 filing and coordination
• OFAC Compliance: Sanctions list screening coordination
• Federal Reserve: Coordination on banking matters
• OCC Coordination: Dual banking system cooperation

State Coordination

• Information Sharing: Subject to confidentiality protections
• Enforcement Cooperation: Joint investigations as needed
• Multi-State Licensing: NMLS reciprocal coordination
• Industry Communication: State banking association participation

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Anchorage Office

Alaska Division of Banking and Securities

550 W 7th Avenue, Suite 1850

Anchorage, Alaska 99501

Phone: (907) 269-8140

Toll-Free: (888) 925-2521

Email: [email protected]

Juneau Office

Alaska Division of Banking and Securities

333 Willoughby Avenue, 9th Floor

State Office Building

Juneau, Alaska 99801

Phone: (907) 465-2521

Toll-Free: (888) 925-2521

Main Website

https://www.commerce.alaska.gov/web/dbs

Money Service Businesses Information

https://www.commerce.alaska.gov/web/dbs/ConsumerFinance/MoneyServiceBusinesses.aspx

Notes on Naming and Language