Guidance and
Advisory Issued on Banking Services for Money Services Businesses Operating in
the United States
The Financial Crimes Enforcement Network (FinCEN), along
with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance
Corporation, the National Credit Union Administration, the Office of the
Comptroller of the Currency, and the Office of Thrift Supervision
(collectively, the Federal Banking Agencies), today issued interpretive
guidance designed to clarify the requirements for, and assist banking
organizations in, appropriately assessing and minimizing risks posed by
providing banking services to money services businesses.
FinCEN also has issued a concurrent advisory to money
services businesses to emphasize their Bank Secrecy Act regulatory obligations
and to notify them of the types of information that they will be expected to
provide to a banking organization in the course of opening or maintaining
account relationships.
While recognizing the importance and diversity of services
provided by money services businesses, the guidance to banking organizations
specifies that FinCEN and the Federal Banking Agencies expect banking
organizations that open and maintain accounts for money services businesses to
apply the requirements of the Bank Secrecy Act, as they do with all
accountholders, on a risk-assessed basis.
Registration with FinCEN, if
required, and compliance with any state licensing requirements represent the
most basic of compliance obligations for money services businesses.
Based on existing Bank Secrecy Act requirements applicable
to banking organizations, the minimum compliance expectations associated with
opening and maintaining accounts for money services businesses are:
q Apply the banking organizations Customer
Identification Program;
q Confirm FinCEN registration, if required;
q Confirm compliance with state or local
licensing requirements, if applicable;
q
Confirm
agent status, if applicable; and
q
Conduct basic risk assessment
to determine the level of risk associated with the account.
Through the
interpretive guidance, FinCEN and the Federal Banking Agencies confirm that
banking organizations have the flexibility to provide banking services to a
wide range of money services businesses while remaining in compliance with the
Bank Secrecy Act. While banking
organizations are expected to manage risk associated with all accounts,
including money services business accounts, banking organizations are not required
to ensure their customers compliance with all applicable federal and state
laws and regulations.
The guidance contains examples that may be indicative of
lower and higher risk within money services business accounts to assist banking
organizations in identifying the risks posed by a money services business
customer and in reporting known or suspected violations of law or suspicious
transactions relevant to possible violations of law or regulation.
In addition, the guidance addresses the recurring question
of the obligation of a banking organization to file a suspicious activity
report on a money services business that has failed to register with FinCEN, if
required to do so, or failed to obtain a license under applicable state law, if
required. The guidance states that a
banking organization should file a suspicious activity report if it becomes
aware that a customer is operating in violation of the registration or state
licensing requirements. This approach
is consistent with long-standing practices of FinCEN and the Federal Banking
Agencies under which banking organizations file suspicious activity reports on
known or suspected violations of law or regulation.
The concurrently issued FinCEN advisory to money services
businesses emphasizes the importance of compliance with Bank Secrecy Act
regulatory requirements by money services businesses. The advisory is designed to assist money services businesses by
outlining the types of information that they should have and be prepared to
provide to a banking organization in the course of opening or maintaining
account relationships. The advisory
also makes clear that money services businesses that fail to comply with the
most basic requirements of the Bank Secrecy Act, such as registration with
FinCEN if required, will be subject to regulatory and law enforcement scrutiny,
and that continued non-compliance will likely result in the loss of banking
services.
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