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OFFICIALS CLASH OVER VETO OF NON-BANK ATM'S

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Lt. Gov. Gerard Luz James II and Sen. David Jones are at loggerheads over whether "money machines" controlled by entities other than banks should be permitted to operate in the territory without falling under the regulatory oversight of the V.I. Banking Board.
Gov. Charles W. Turnbull vetoed a portion of the fiscal year 2000 Omnibus Act that would have allowed the operation of automated teller machines (ATMs) by non-banking businesses that would not be regulated as financial institutions.
James, as chair of the V.I. Banking Board, wrote Jones on Dec. 8 opposing the senator's intention to lobby legislative colleagues to override the veto. The Banking Board considers the dispensing of cash via an ATM to be a financial service and, thus, under the regulatory authority of the board, the lieutenant governor said. He noted that this is also the view taken by various state governments.
If non-bank ATM's are to be allowed into the territory, James said, "their licensing and regulation should fall under the Banking Board."
Jones, in response, issued a response on Saturday saying he would hold a press conference Monday, Dec. 13, to address "the important issue of establishing non-banking ATM machines in the territory." He said the news media had received an "erroneous" message from the banking industry, with "a hidden agenda that could seriously impact the opportunity to benefit the economy of the territory."
The senator said that at the press conference the media would be able to "get the facts, the real facts, on an issue that will be vital to enhancing the Virgin Islands economy and tourism dollars."
As proposed in the vetoed legislation, non-bank ATMs could be registered with the Licensing and Consumer Affairs Department but there would be no regulating of networks, operators or servicing agents. Such a situation, James said, could encourage money-laundering and would preclude the government from deriving any ongoing revenue from the operations.
Licensing and Consumer Affairs declined to issue a license to an applicant for such an ATM operation earlier this year, James said, and instead referred the applicant to the Banking Board as the appropriate entity for licensing and regulating cash-dispensing machines.
In his letter to Jones, James said the senator had been "kept informed" of these matters, including the board's denial of the application and the basis for it.

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