SB 505: Money Transmission Act: authentication.

Official summary

Legislative Counsel’s Digest (official, as of the latest version). Written by nonpartisan legislative staff; reproduced verbatim.

The Money Transmission Act (MTA) prohibits a person from engaging in the business of money transmission in the state, or from advertising, soliciting, or holding itself out as providing money transmission in the state, unless the person is licensed by the Department of Financial Protection and Innovation under the act. The MTA defines “money transmission” to mean, among other things, selling or issuing stored value to a person located in the state and defines “stored value” to mean monetary value representing a claim against the issuer that is stored on an electronic or digital medium and evidenced by an electronic or digital record and that is intended and accepted for use as a means of redemption for money or monetary value or payment for goods or services. The MTA punishes noncompliance with, among other things, a civil penalty, license revocation, and, for certain violations, as a felony, as prescribed.

This bill would prohibit a licensee under the MTA from allowing a user login unless the licensee has implemented specified processes, including 2-factor authentication, multifactor authentication, or other reasonably equivalent or more secure access control, as specified. The bill would provide that its provisions become operative January 1, 2028. By expanding the scope of a crime, this bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Sponsors

Sponsors by party (alphabetical): Democratic 1

“Support” is shown only as formal sponsorship recorded by the legislature. Roll-call votes are available on the official bill page.

Recent official actions

1. September 27, 2026Chaptered by Secretary of State. Chapter 648, Statutes of 2026.
2. September 27, 2026Chaptered by Secretary of State. Chapter 648, Statutes of 2026.
3. September 27, 2026Approved by the Governor.
4. September 27, 2026Approved by the Governor.
5. September 2, 2026Enrolled and presented to the Governor at 3 p.m.
6. September 2, 2026Enrolled and presented to the Governor at 3 p.m.
7. August 27, 2026Assembly amendments concurred in. (Ayes 40. Noes 0. Page 5982.) Ordered to engrossing and enrolling.
8. August 27, 2026Assembly amendments concurred in. (Ayes 39. Noes 0.) Ordered to engrossing and enrolling.
9. August 25, 2026Ordered to special consent calendar.
10. August 25, 2026Ordered to special consent calendar.
11. August 18, 2026In Senate. Concurrence in Assembly amendments pending.
12. August 18, 2026In Senate. Concurrence in Assembly amendments pending.