Colorado § 11-110-1003 - Maintenance of permissible investments - statutory trust - rules.

§ 11-110-1003. Maintenance of permissible investments - statutory trust - rules.

(1) A licensee shall maintain at all times permissible investments that have a market value computed in accordance with United States generally accepted accounting principles of not less than the aggregate amount of all of the licensee's outstanding money transmission obligations.

(2) Except for permissible investments enumerated in section 11-110-1004 (1), the banking board, with respect to a licensee, may by rule or order limit the extent to which a specific investment maintained by a licensee within a class of permissible investments may be considered a permissible investment if the specific investment represents undue risk to customers not reflected in the market value of investments.

(3) Permissible investments, even if commingled with other assets of a licensee, are held in trust for the benefit of the purchasers and holders of the licensee's outstanding money transmission obligations in the event of insolvency; the filing of a petition by or against the licensee under the United States bankruptcy code, 11 U.S.C. secs. 101 to 110, as amended, for bankruptcy or reorganization; the filing of a petition by or against the licensee for receivership; the commencement of any other judicial or administrative proceeding for the licensee's dissolution or reorganization; or an action against the licensee by a creditor that is not a beneficiary of the statutory trust. Permissible investments impressed with a trust pursuant to this section are not subject to attachment, levy of execution, or sequestration by order of any court, except for a beneficiary of the statutory trust.

(4) Upon the establishment of a statutory trust in accordance with subsection (3) of this section or when money is drawn on a letter of credit pursuant to section 11-110-1004 (1)(d), the banking board shall notify the applicable regulator of each state in which the licensee is licensed to engage in money transmission, if any, of the establishment of the trust or the money drawn on the letter of credit, as applicable. Notice is deemed satisfied if performed pursuant to a multistate agreement or through NMLS. Money drawn on a letter of credit, and any other permissible investments held in trust for the benefit of the purchasers and holders of the licensee's outstanding money transmission obligations, is deemed held in trust for the benefit of such purchasers and holders on a pro rata and equitable basis in accordance with statutes pursuant to which permissible investments are required to be held in this state, and other states, as applicable. A statutory trust established pursuant to this section is terminated upon extinguishment of all of the licensee's outstanding money transmission obligations.

(5) The banking board by rule may allow other types of investments that the board determines are of sufficient liquidity and quality to be a permissible investment. The banking board may participate in efforts with other state regulators to determine that other types of investments are of sufficient liquidity and quality to be a permissible investment.

Source: L. 2025: Entire article R&RE, (HB 25-1201), ch. 91, p. 405, § 1, effective August 6.