Bank Note Regulations Act 2025

This second version was passed by the Senate on 16 July 2025, and signed by the President on 17 July 2025.

Author: anaphase_andy

Preamble

Whereas: the bank note has recently been introduced into the SimDem economy via the Mypen-Rocky Bank;

Whereas: bank notes, as a new economic frontier, are currently unregulated;

Whereas: regulations around our financial industry is necessary to ensure that, upon its growth, the financial industry does not do more harm than good;

Article 1: Definitions

§1. “Bank notes,” or “a bank note” shall be defined as any placeholder for tau or monetary currency (i.e cash), and shall refer to all bank notes offered by an institution (i.e a brand of bank notes).

§2. A “foreign exchange” is a type of financial institution that solely facilitates the transferring of monetary value from one currency to another (i.e changing dollars into euros), whether that be directly or via the utilization of bank notes.

§3. A “financial institution” shall be defined as any legal entity that provides services relating to the management of currency, its growth, its expenditure, its security, its exchange, or preventing the loss of currency. Banks are a type of financial institution that accept deposits and offer loans (SDSB regulations may concretize this definition). Casinos shall also be defined as financial institutions and may be referenced as such in other pieces of legislation.<ref name="BEA" />

§4. ”Minting” shall be defined (for the purposes of this bill) as the creation of new bank notes.

Article 2: Record Keeping and Notice Regulations

§1. Any financial institution that mints or distributes bank notes must notify the SimDem State Bank (SDSB) that they provide such a service, and must get subsequent confirmation from the SDSB, which the SDSB must provide immediately upon viewing the aforementioned notice.<ref name="BEA">Banking and Economy Amendments Act passed by the Senate on 9 February 2026, and not vetoed by the President within 72 hours.</ref>

§2. All financial institutions and foreign exchanges must keep a detailed and complete record of all minted bank notes and the rate at which they may be exchanged with the financial institution or foreign exchange between the tau and any other currencies offered for exchange, as well as the time and day they were exchanged and at what rate they were exchanged.

§2.1 Financial institutions must also keep detailed and complete records of all monetary reserves, in tau, held and controlled by the financial institution.

§3. Before minting bank notes, a financial institution or foreign exchange must notify the SDSB of the amount of bank notes being minted, what currencies they may be exchanged for, and all exchange rates.

§4. If a financial institution or foreign exchange wishes to offer an exchange rate for bank notes that was not previously offered at the time of initial minting (the minting of the institution’s first bank note(s)), the financial institution or foreign exchange must notify the SDSB what currency the financial institution or foreign exchange wishes to offer an exchange for, and at what rate prior to offering that exchange. The same must be done if a financial institution or foreign exchange wishes to change the exchange rate between a bank note and a currency, or between two currencies.

§5. All ledgers, records and documentation (including contracts relating to the distribution of bank notes) relating to the minting, distribution, or exchange of bank notes must be available upon request by the SDSB for audit within twenty-four (24) hours of the aforementioned request.

§5.1 If, by the end of the aforementioned twenty-four (24) hours, all documentation relating to the minting and distribution of the financial institution’s bank notes are not made available, then the SDSB may levy a fine of up to ten thousand (10,000) tau via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Obstruction of a Financial Investigation”.

§5.1.1 “Obstruction of a Financial Investigation” shall be added as Article 20a of the Criminal Code 2020, and shall be defined as the following:

    “§1. The crime of obstruction of a financial investigation shall be failing to provide legally mandated documentation within a timeframe subsequently mandated by law after receiving notice from the requesting government official, when the documentation relates to a financial service or service provider; a person also commits this crime when they provide falsified or knowingly inaccurate or incomplete documentation.
    §2. The crime of obstruction of a financial investigation may be punished with a fine of up to 10,000t.”

§5.2 The SDSB, for the purposes of the requirements levied by this article, shall be satisfied when the documentation and records provided account for all known minted bank notes, their exchange rates, the dates minted, and the entity or person(s) they were first distributed to (if applicable).

§6. It shall be the duty of the Central Revenue Bureau to enforce the sections of this article.

§7. The SDSB may set regulations for the specific and narrow purpose of easily accessing the required documentation, and for the enforcement of this article.

Article 3: Bank Note Regulations

§1. No bank note may be exchanged or sold for a value greater than ten (10) tau.

§1.1 Violation §1 shall warrant a fine of up to two-thousand five-hundred (2,500) tau per violation (at the discretion of the SDSB) via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Violation of Bank Note Regulations”.

§1.1.1 The crime of “Violation of Bank Note Regulations” shall be added to the Criminal Code 2020 as Article 52a, and shall read as the following:

    “§1. The crime of violation of bank note regulations shall occur when a person or entity knowingly acts in such a manner as to violate the regulations put in place by Article 3 of the Bank Note Regulations Act 2025.”

§2. A financial institution or foreign exchange may not change the exchange rate nor refuse an exchange between a bank note or a brand of bank notes and any currency, nor between two currencies, without first adhering to article two of this act, and clearly notifying the general public twenty-four (24) hours in advance.

§2.1 Violation of §2 shall warrant a fine of up to ten-thousand (10,000) tau for each violation (at the discretion of the SDSB) via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Violation of Bank Note Regulations”.

§3. A financial institution or foreign exchange may not be contracted, employed, or otherwise compensated for products or services by the SDSB.

§3.1 Violation of §3 shall require a fine of ten-thousand (10,000) on the financial institution or foreign exchange, levied by the Department of the Justice via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the Department of the Treasury under the charge of “Violation of Bank Note Regulations”.

§4. A foreign exchange may not mint bank notes.

§4.1 Violation of §4 shall warrant a fine of up to ten-thousand (10,000) tau per violation, at the discretion of the SDSB, via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Violation of Bank Note Regulations”.

§5. The total value of all bank notes minted and distributed by a financial institution may be worth no more than 150% of reserves, in tau, held by the same financial institution.

§5.1 Violation of §5 shall warrant a fine of up to fifteen-thousand (15,000) tau per 20% the total value of minted and distributed bank notes is over the financial institution’s reserve, at the discretion of the SDSB, via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Violation of Bank Note Regulations”.

§6. Once distributed, a bank note may not be destroyed, unless the bank note is held by the originating financial institution.

§6.1 Violation of §6 shall warrant a fine of double the value, in bank notes destroyed, via a criminal ticket, which may be rejected by the accused, and subsequently brought to court by the SDSB under the charge of “Violation of Bank Note Regulations”.

§7. Once distributed, the exchange rate of a brand of bank notes into and out of tau may never be changed.

§8. The SDSB may set regulations for the specific and narrow purpose of easily accessing the required documentation, and for the enforcement of this article.

Article 4: Enactment

§1. This Act shall come into effect one week after passage, so that the SDSB may have some time to familiarize themselves with this Act, and prepare for proper enforcement.

Citations

Bank Note Regulations Act 2025

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