As a money services business you need to be aware of the federal government regulations surrounding money services. If you are not, you may be putting your business at risk by not fully complying with the law. Here are ten things that retailers should be aware of if they are cashing third party checks and/or providing wire transfer services.
1. Money Service Business (MSB) Registration Requirements (Check Casher permit) – Any business conducting money transactions in amounts over $1,000.00 must register with FinCEN. Also, any business doing wire transfers, regardless of the amount, is automatically considered an MSB and must also register with FinCEN (http://www.fincen.gov/). See my previous Money Service Licensing 101 post for more on registering with FinCEN, as well as any state registration requirements for check cashers.
2. Anti-Money Laundering (AML) Program – This is a requirement of all MSBs. This program must be in writing and provide adequate training, testing and implementation to fight money-laundering and other financial crimes.
3. Bank Secrecy Act – Be aware of these regulations that require all Money Service Businesses to create paper trails by keeping records and filing the proper reports.
4. US Patriot Act – Enforces “know you customer” and requires maintaining a record to prove that these check cashers are not known terrorists.
5. Designation of Compliance Officer – Your business must have a designated compliance officer who is trained and familiar with AML compliance regulations.
6. Currency Transaction Reports (CTR) – Be familiar with these government reporting forms and ensure that you are reporting all applicable transactions.
7. Suspicious Act Reports (SAR) – As with the CTR, be familiar with these government reporting forms and ensure that you are reporting all applicable transactions.
8. Money Order & Money Transfer Logging/ID Requirements – This activity has its own separate set of identification requirements. Make sure you are complying with government regulations by filling them out as necessary.
9. Proper Filing & Proper Record Keeping Requirements – Your business should keep records on file for at least 5 years.
10. Office of Foreign Assets Control (OFAC) Specially Designated Nationals List – Provided by the Office of Homeland Security this list is updated regularly. You should always use the latest version when checking against your check cashing customers
For more on government compliance and implementing an AML program, visit the AllTrust website, or call our compliance hotline at 1-800-683-4214.
