On June 20, the Nevada Secretary of State approved Regulation NAC 604D, LCB File No. R096-23 (the Regulation), issued by the Nevada Department of Business and Industry, Financial Institutions Division, which established provisions to implement SB 290 (the Act) relating to earned wage access (covered by InfoBytes here).

The Regulation established the commissioner’s interpretation of the term “indirectly” as used in the definition of “employer-integrated earned wage access services” in the Act. As the Legislative Counsel’s Digest for the Regulation explained, “S.B. 290 defines employer-integrated earned wage access services to mean the delivery to a user of access to earned but unpaid income determined based on employment, income or attendance data obtained directly or indirectly from an employer.” In this context, the Regulation provided that data obtained “indirectly” from an employer means “verified data of the employment, income, or attendance of the user that is:” (i) “Obtained from an integrated system”; (ii) “Not directly obtained from the system of an employer”; and (iii) “Not directly obtained from the user.” The Regulation further provides that an “owner” was “a person who holds an ownership interest of at least 10 percent or more in an applicant for the issuance of a license as a provider that is a business entity.” The Regulation also clarified that providers are prohibited from charging cancellation fees of any kind.

The Regulation set forth $1,000 fees each for (i) the initial application for a license; (ii)  the initial issuance of a license as a provider; (iii) the annual renewal of such a license; and (iv) the reinstatement of an expired license. Furthermore, the Regulation provided that each application for licensure by a provider that is a business entity must be accompanied by a list consisting of each person who holds an ownership interest in the applicant.

Pursuant to the Regulation, licensees will be required to report specific activity-based information to the state, including, non-exhaustively, the (i) total number and value of fees and expedited delivery fees paid by users within the prior year; (ii) the number of users with outstanding proceeds at the time of reporting and the value of such outstanding proceeds; (iii) the total number of requests for reimbursement of overdraft or NSF fees in the prior year; and (iv) voluntary tips received. Licensees will also be required to submit audited financial statements by April 15 each year (or, if not available, unaudited financial statements by April 15, followed by audited financial statements by June 30 of that same year). Licensees must retain records for at least six years and must not engage in misleading advertising. With respect to supervision, the Regulation establishes an hourly fee of $75 that the commissioner will charge for any supervision, examination, audit, investigation or hearing conducted pursuant to the provisions of the Act and provided that the commissioner can revoke or suspend licenses for any violations and has broad authority to request information during examinations or investigations.

This Regulation will go into effect on July 1.