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Common MSB Related Questions

Below are excerpts from several financial institutions covering questions to be asked of Money Service Businesses (MSBs). The examples are in no particular order.

Example 1. General Internal Questions

1. Could the applicant, whether an individual or non-individual, possibly be considered an MSB because of primary or ancillary services they may provide, or activities in which they may engage [e.g. i.) a body shop, bar, liquor store or tienda that cashes a notable volume of checks for its customers; ii) a caterer or travel agent that does the same, but applies for an account as a TIN versus an EIN (i.e. an individual vs. a non-individual)].

In other words, what prompts the front office that Enhanced Due Diligence (EDD) is appropriate if the applicant is not an obvious MSB? (other examples: hotels that cash checks and exchange currency for guests; insurance agents and postal stores that also provide full panoply of money services); all manner of high-volume retail cash flow businesses).

2. Is it appropriate to perform EDD on the principals of the applicant?

3. Do the principals meet minimum CIP requirements?

4. What are the fully disclosed primary and ancillary financial services that the applicant provides its customers?

5. Have you made a site visit? Did you note the agency decals in the windows?

6. Is the applicant an agent of Western Union or MoneyGram (or other MSB principal)? Did you verify their status with the principal (e.g. check their agent network web-sites)?

7. Has the applicant certified that they have an AML program (USA PATRIOT 352 compliant)? Do they meet Section 352 requirements, including an independent program review? The report should be made available as part of EDD. Are you satisfied with the performer and the performance of the review?

8. Can the applicant provide evidence of current state licensing? Has there been a state supervisory examination? (depends on the state, e.g. Texas, Massachusetts, California, NY have exams).

9. Is state licensing consistent with products and services? (e.g. Licensed as a check casher but not as a money transmitter).

10. Can the applicant provide evidence of FinCEN registration (if required)? Western Union or MoneyGram agents (or other) do not have to register independently of the principals if they are agents for those services. However, they may have to register for non-agency services (e.g. if they are also a check casher). If they are an agent, have you checked the principal agency network web-sites for authenticity?

11. Are you collecting enough EDD to enable you to determine expected activity that will enable you to sufficiently monitor against after you have established the relationship and opened the account?

12. Are you reviewing the relationship at least annually to make sure that EDD is up-to-date and to assess whether to continue the relationship? Are the services or activities changing?

13. Are you checking the principals against OFAC and PEP databases?

Example 2. Documentary Requirements for Money Services Businesses

Requirements for all Money Service Businesses:
___ Signed Bank/ MSB Agreement
___ Articles of Incorporation (w/ proof of filing w/ state)
___ List of All Authorized Signers: Names, Addresses, DOB's, TIN's and titles
___ List of All Owners: Names, Addresses, DOB's, TIN's and percentage of ownership interest
___ 2 Forms of Unexpired ID (one primary and one secondary) for each authorized signer and owner of the business (per HUB Acceptable ID List)
___ List of all Employees: Names, Addresses, DOB's, and TIN's
___ Copy of Most Recent Audited Financial Statements
___ Copy of Most Recent Business Tax Return
___ Copy of BSA-AML Compliance Program (policies, procedures, manuals and training materials
___ Copy of Most Recent BSA-AML Compliance Audit
___ Copy of Business Brochure (if one exists)
___ Fee Schedule (if one exists)
___ Reference Letter from Accountant or Attorney

Additional documents for Licensed Money Remitters:
___ Copy of Unexpired State Issued Money Remitter License (for all states)
___ Copy of Current MSB Registration Filed with FinCEN
___ Copy of Current List of Agents by State
___ Copy of Current List of all your Foreign Paying Agents (including country and city of location)
___ Copy of a Sample Agent Agreement
___ Copy of a Sample Agreement with Foreign Paying Agent (for each country)

Additional documents for Agents of Money Remitters:
___ Copy of All Agent Agreements

Additional documents for Check Cashers:
___ Copy of Current MSB Registration Filed with FinCEN
___ Copy of Unexpired State Issued Check Casher License (for all states)
___ List of all Corporate Check Cashing Customers

Additional documents for Currency Exchangers:
___ Copy of Current MSB Registration Filed with FinCEN
___ Copies of All Agent Agreements

Example 3. Questionnaire for Money Services Businesses

Please fill in ALL the sections that apply to your money service business operation(s) and provide all applicable documentation called for on the checklist. 

Name of the Business:
Doing Business As (DBA):
Tax ID Number:
Web Site Address:
Years in Business: 

1. BSA/AML Compliance:
Who is your BSA/AML Compliance Officer? (Name & telephone)
Who conducts your independent BSA/AML compliance audits? (Name, address & telephone #)
Are the BSA/AML compliance audits performed internally or externally?
When was your last independent BSA/AML compliance audit completed?
Have you been subjected to any regulatory action in the past 5 years? If Yes, explain and attach relevant documentation. 

2. Money Remitters:
What is your average monthly transaction volume?
List the five (5) countries that you primarily remit to and the approximate percentage of overall outgoing volume:

Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%
Name of Business: _______________ Tax ID:___________________

List the five (5) countries that you primarily receive wires from and the approximate percentage of overall incoming volume:

Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%

Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%
Country: _______________ Percentage of overall volume: ________%

List the names of all licensed money remitters for whom you serve as an agent.

Are you registered with FinCEN as a Money Service Business?
Do you maintain any business account(s) in foreign countries?
If Yes, list the name of the bank(s) and location(s):
Provide brief description of your customer base:
Do you accept utility payments? 

3. Check Cashers:
Do you have a check-cashing license?
If Yes, list state(s) where you are licensed.
Are you registered with FinCEN as a check casher?
What is the approximate number of checks cashed per month?
What is the approximate dollar amount of checks cashed per month?
What is the maximum check amount(s) that you will cash for any one customer on any day? 

4. Sellers of Monetary Instruments:
Do you sell money orders or traveler's checks?
If Yes, list the names and average monthly volumes:

Issuer Name: ___________________ Monthly volume: $___________
Issuer Name: ___________________ Monthly volume: $___________
Issuer Name: ___________________ Monthly volume: $___________
Name of Business: _______________ Tax ID:____________________

Are you registered with FinCEN as a seller of traveler's checks or money orders? 

5. Sellers of Stored Value Cards (Phone Cards/Debit Cards)
Do you sell stored value cards?
If Yes, list the names and monthly volumes:

Issuer Name: ____________________ Monthly volumes $_____________
Issuer Name: ____________________ Monthly volumes $_____________
Issuer Name: ____________________ Monthly volumes $_____________

6. Foreign Currency Exchangers:
Do you exchange foreign currency?
If Yes, list the primary currencies you deal in:

What is your average monthly exchange volume?
What is the source of your foreign currency inventory?
Are you registered with FinCEN as a Currency Exchanger?
Provide a brief description of your customer base:

Date _____/_____/_____

Signature of Owner, Controlling Person or Authorized Corporate Officer _____________________________________________________

Print Name and Title of Person Signing

Reviewed By: ___________________________________________
Date Reviewed _____/_____/______

_____________________________________________________
Print Name and Title of Person Reviewing

Example 4. Documentary Requirements for Money Services Businesses

These requirements are in addition to the normal account opening requirements and those listed on the EDD Call Report.

Requirements for ALL Money Service Businesses:
___ Signed BANK/ MSB Agreement
___ Copy of BSA/AML Compliance Program (policies, procedures, manuals and training materials)
___ Copy of most recent independent BSA/AML Compliance Audit or Review
___ Copy of business brochure (if one exists)
___ Fee Schedule (if one exists)

Additional Documents for Agents of Money Remitters:
___ Copy of ALL agent agreements

Additional Documents for Check Cashers:
___ Copy of current MSB Registration filed with FinCEN
___ Copy of unexpired State issued Check Casher License (for all states)

Additional Documents for Currency Exchangers:
___ Copy of current MSB Registration filed with FinCEN
___ List of branch locations

Additional Documents for Sellers of Money Orders and Traveler's Checks:
___Copy of all agent agreements

Example 5. Questions at Application Opening for MSB System Program

Does the business expect to:

1. Conduct Cash Trans > $3000 Daily Y/N
2. Send/Receive Domestic Wire Transfers Y/N
3. Send/Receive International Wire Transfers Y/N

Does the business plan to sell/offer these services to its customers:

4. Check Cashing Y/N
5. Monetary Instruments Y/N
6. Wire Transfers Y/N
7. Currency Exchange Y/N
8. Percentage of expected annual revenue from selling these services free text (3 numerical digits)

If there is at least one "Y" response to questions 4 - 7, then question 8 must be answered. The response must be greater than 0.

If the responses to questions 4 - 7 are all "N", then question 8 should default to 0 and the field is locked down (no one can edit the field)

If the response to question 8 is greater than or equal to 50 and all other required fields are completed, the account application should terminate when the user clicks the "Next" button on the Business Information View. If the application is terminated, a dynamic applet will be displayed with scripting.

If the response to question 8 is less than 50, then the application will continue.

We can then monitor the customers who had less than 50% of their revenue coming from the MSB activity to determine if they are engaging in triggering levels...........these would be the 'noncore MSBs'

Example 6. Customer Identification Program (CIP)/Money Services Business (MSB) Certification

In accordance with the Bank Secrecy Act (BSA) of 1970, along with its various amendments, and the USA Patriot Act of 2001, Bank X is required to establish an anti-money laundering (AML) and CIP program meant to identify violations of law and/or suspicious activity conducted by customers/non-customers. As part of the Bank's effort to comply with these laws and to protect the Bank from any risk associated with non-compliance, we are requesting that you complete this Customer Identification Program (CIP)/Money Services Business (MSB) Certification form. This form is an important tool in understanding the source, type, and amount of activity that is flowing through the customer's account(s).

Please answer the questions below in detail. If you are unfamiliar with the customer, please obtain the customer information prior to completing this form. This information is for internal use only and must be kept confidential.

Account Title:
D/B/A, if applicable:
Address:
TIN:
Type of Business:
Primary Business Activities:

Have you contacted the customer at their place of business? Yes _____ No _____
How long has the customer been in business?
Does the customer have multiple locations? Yes _____ No _____

If Yes, please list the locations:

What Bank X services will the customer be using or are they presently using? (Check all that apply)

Checking _____
Loans _____
Night Deposit _____
Money Market _____
Trust _____
Investment Department _____
Savings _____
Safe Deposit _____
eManager _____
CD _____
Wire Transfer _____
VRU _____

Does the customer anticipate making frequent deposits or withdrawals of cash?
Yes _____ No _____

Does the customer perform any of the following Secondary Business Activities/Services? Yes _____ No _____

(If Yes, check all that apply.)

Lottery Ticket Sales _____
Own/Operate an ATM Machine _____

MSB Activities: (Check all that apply)

Provide Money Transfer Services (Western Union, wire transfers, etc.) a/k/a/ "Money Transmitter" _____
Sell Travelers Checks _____
Sell Money Orders _____
Sell Stored Value Cards or Gift Certificates _____
Check Casher _____
Currency Dealer or Exchange _____
Other (please specify): __________________________________________________

Does the customer conduct more than $1,000 in business, with one person, in one or more transactions, on any one day, in one (or more) category(ies) of activity listed under MSB activities above? Yes _____ No _____

If Yes, has the customer registered as an MSB with FinCEN? Yes _____ No _____

If Yes, attach a copy of the MSB's IRS Acknowledgement Letter.

If No, explain why the customer has not registered

NOTE: A business that acts as an agent (as a seller of money orders) for an issuer of money orders, and performs no other services of a nature and amount that would cause the business to be an MSB, is not required to register. This is true even if the business serves as an agent for two or more MSBs. However, the business must register if, in addition to acting as an agent of the money order issuer, it provides check cashing or currency exchange services (other than as an agent for another MSB) in an amount greater than $1,000 for any person, on any day, in one or more transactions.

If the customer is required to register but has not, instruct the customer that they MUST register with FinCEN and provide a copy of their IRS Letter of Acknowledgement form. If this is a new customer, DO NOT open the account. If this is an existing customer, contact the Corporate Security Department.

Account Officer's Name:
Title:
Date:

Account Officer's Signature: