{"data":{"id":"us-ky/krs-286.9-100","jurisdiction":"us-ky","citation":"KRS 286.9-100","heading":"Procedures to be followed by licensees.","body":"(1) (a) Any fee charged by a licensee for cashing a check or entering into a deferred\ndeposit transaction shall be disclosed in writing to the bearer of the check\nprior to cashing the check or entering into a deferred deposit transaction, and\nthe fee shall be deemed a service fee and not interest.\n(b) A licensee shall not charge a service fee in excess of fifteen dollars ($15) per\none hundred dollars ($100) on the face amount of a deferred deposit check. A\nlicensee shall prorate any fee, based upon the maximum fee of fifteen dollars\n($15) per one hundred dollars ($100). This service fee shall be for a period of\nat least fourteen (14) days.\n(2) Before a licensee shall deposit with any bank or other depository institution a check\ncashed by the licensee, the check shal l be endorsed with the actual name under\nwhich the licensee is doing business.\n(3) A licensee shall not cash a check payable to a payee other than a natural person\nunless the licensee has previously obtained appropriate documentation from the\nboard of dire ctors or similar governing body of the payee clearly indicating the\nauthority of the natural person or persons cashing the check, draft, or money order\non behalf of the payee.\n(4) (a) A licensee shall:\n1. Not indicate through advertising, signs, billhead, or otherwise that\nchecks may be cashed without identification of the bearer of the check;\nand\n2. Require any person seeking to cash a check to submit reasonable\nidentification as prescribed by the commissioner.\n(b) The provisions of this subsection shall not prohibit a licensee from cashing a\ncheck simultaneously with the verification and establishment of the identity of\nthe presenter by means other than the presentation of identification.\n(5) (a) Within two (2) business days after being advised by a financial institution that\na payment instrument has been altered, forged, stolen, obtained through\nfraudulent or illegal means, negotiated without proper legal authority, or\notherwise represents the proceeds of illegal ac tivity, the licensee shall notify\nthe commissioner and the prosecutor or law enforcement authority in the\ncounty in which the check was received.\n(b) If a payment instrument is returned to the licensee by a financial institution\nfor any of the reasons stat ed in paragraph (a) of this subsection, the licensee\nshall not release the payment instrument without the written consent of the\nprosecutor or law enforcement authority or a court order.\n(6) A licensee shall not alter or delete the date on any payment inst rument accepted by\nthe licensee.\n(7) A licensee shall not engage in unfair or deceptive acts, practices, or advertising in\nthe conduct of the licensed business.\n(8) A licensee shall not require a customer to provide security for a deferred deposit\ntransaction or require the customer to provide a guaranty from another person.\n(9) (a) A licensee shall not have more than two (2) deferred deposit transactions from\nany one (1) customer at any one time.\n(b) 1. Except as provided in subparagraph 2. of this paragra ph, the total\nproceeds received by a customer from all open deferred deposit\ntransactions shall not exceed six hundred dollars ($600).\n2. a. Subject to subdivision b. of this subparagraph, the commissioner\nshall, on or before July 1 of each year, issue an order increasing, or\ndecreasing if the percent change is negative, the maximum amount\nof total proceeds permitted under subparagraph 1. of this\nparagraph by the percent change in the nonseasonally adjusted\nannual average Consumer Price Index for all Urban Consumers\n(CPI-U), U.S. City Average, All Items, for the previous calendar\nyear as published by the United States Bureau of Labor Statistics,\nexcept the amount shall be rounded up to the nearest ten dollar\n($10) increment.\nb. The commissioner shall not iss ue an order under subdivision a. of\nthis subparagraph that results in the amount of total proceeds\npermitted under subparagraph 1. of this paragraph exceeding eight\nhundred fifty dollars ($850).\n(10) (a) If the database described in KRS 286.9 -140 is unavai lable due to technical\ndifficulties with the database, as determined by the commissioner, a licensee\nshall utilize the process established in this subsection to verify deferred\ndeposit transactions.\n(b) A licensee shall inquire of any customer seeking to e nter into a deferred\ndeposit transaction, whether the customer has any outstanding deferred\ndeposit transactions from any licensee.\n(c) If the customer represents in writing that the customer has no more than one\n(1) deferred deposit transaction outstandin g to any licensee and that the total\nproceeds received by the customer from the outstanding deferred deposit\ntransaction does not equal or exceed the amount permitted under subsection\n(9)(b) of this section, a licensee may accept a deferred deposit transac tion in\nan amount that, when combined with the customer's other outstanding\ndeferred deposit transaction, does not exceed the amount permitted under\nsubsection (9)(b) of this section.\n(d) If the customer represents in writing that the customer has more tha n one (1)\ndeferred deposit transaction outstanding to licensees or if the total proceeds\nreceived by the customer from the deferred deposit transactions equal or\nexceed the amount permitted under subsection (9)(b) of this section, a licensee\nshall not ente r into another deferred deposit transaction with that customer\nuntil the customer represents to the licensee in writing that the customer\nqualifies to enter into a new deferred deposit transaction under the\nrequirements set forth in this subtitle.\n(11) A l icensee shall not use any device or agreement, including agreements with an\naffiliate of a licensee, with the intent to obtain greater charges than are authorized in\nthis subtitle.\n(12) A licensee shall not agree to hold a deferred deposit transaction for more than sixty\n(60) days.\n(13) (a) Each deferred deposit transaction shall be made according to a written or\nelectronic agreement that is:\n1. Dated and signed by the customer and the licensee or an authorized\nagent of the licensee; and\n2. Made available to the commissioner upon request.\n(b) The customer shall receive a copy of the agreement referenced in paragraph\n(a) of this subsection.\n(c) A customer may enter into an agreement referenced in paragraph (a) of this\nsubsection:\n1. In person at the licensed location; or\n2. If the customer is a citizen of this state, by telephone or other electronic\nmeans.\n(14) A licensee or its affiliate shall not for a fee renew, roll over, or otherwise\nconsolidate a deferred deposit transaction for a customer.\n(15) An individual who enters into a deferred deposit transaction with a licensee shall\nnot be convicted under the provisions of KRS 514.040.\n(16) A licensee who enters into a deferred deposit transaction with an individual shall\nnot prosecute or threaten to prosecute the individual under the provisions of KRS\n514.040.\n(17) Each licensee shall conspicuously display in eac h of its deferred deposit business\nlocations a sign supplied by the commissioner that gives the following notice: \"No\nperson who enters into a post -dated or deferred deposit transaction with this\nbusiness establishment will be prosecuted for or convicted of writing cold checks or\nof theft by deception under the provisions of KRS 514.040.\"\n(18) A licensee shall not enter into a deferred deposit transaction with a customer who\nhas two (2) open deferred deposit transactions.\n(19) A licensee shall verify a cust omer's eligibility to enter into a deferred deposit\ntransaction by doing one (1) of the following, as applicable:\n(a) If the database is not fully operational, as determined by the commissioner,\nthe licensee shall verify that the customer meets the eligibi lity requirements\nfor a deferred deposit transaction under this subtitle. The licensee shall\nmaintain a database of all of the licensee's transactions at all of its locations\nand search that database to meet its obligation under this subtitle; or\n(b) If th e database is fully operational, as determined by the commissioner, the\nlicensee shall promptly and accurately access the database through an internet\nreal-time connection, and verify that the customer meets the eligibility\nrequirements for a deferred deposit transaction under this subtitle.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57586","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:15Z","sha256":"62e009f7dceb8b6e41018d3ae2eeb9e8e3f17b3cf4628ccc7e90c9939486e47f","source_id":"us-ky","stale":false,"prev":"us-ky/krs-286.9-090","next":"us-ky/krs-286.9-102"},"notice":"GroundRules: Original legal text. Not legal advice."}