USA Patriot Act/BSA Reference Guide

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NewUSAPatriotAct/BSAReferenceGuide
IMPORTANT INFORMATION
Please Review Contents Immediately!
 Money Laundering Prevention
And Compliance Guide
 How to Setup your Anti-Money
Laundering Procedures Program
IMPORTANTINFORMATION
Nmmm01
 Financial Crimes Enforcement
Network Frequently Asked Questions
for Money Services Business (MSB)
 BSA E-Filing System
Over50YearsofExcellence
MONEYORDERS•BILLPAYMENTSYSTEM
1‐800‐989‐6669
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Re:EnclosedMoneyLaunderingPreventionandComplianceGuide
DearGlobalExpressTrustee:
Asyouknow,GlobalExpressiscommittedtostrictcompliancewiththeanti‐money
launderinglawsandregulationsoftheUnitedStates.Asamoneyorderand/orbill
paymentsalesoutletofGlobalExpress(a“trustee”underthemoneylaundering
laws),youarerequired,bothunderfederallawaswellasGlobalExpressanti‐
moneylaunderingpolicy,tohaveananti‐moneylaunderingcomplianceprogram.
Enclosedisacomplianceguidewhichmeetstheminimumstandardsacceptableto
GlobalExpressfortrusteecompliancewithanti‐moneylaunderinglawsand
regulationsoftheU.S.BankSecrecyAct/USAPatriotAct.
Pleasebeadvisedthatyoushouldadopt,ataminimum,thisguideandthepolicies
setforththerein,butyoumayimplementmorestringentrequirementsifyouwish.
Forexample,aGlobalExpresstrusteeisfreetorequireidentificationofmoney
orderpurchaserswhobuy$500ormoreofmoneyordersinasingleday,even
thoughfederalregulationsdonotsorequire.Theguideisnotlegaladvice.See
yourlawyerifyouneedlegaladvice.
GlobalExpressisvitallyconcernedthatitsmoneyorderswillnotbeutilizedasa
conduitofillicitfundsforterroristactivities.Theguidehasbeendevelopedto
reflectrecentchangesinthelaw.Underthesechanges,eachGlobalExpresssales
outlet(“trustee”)hasanindependentlegaldutytoinsurethatitscompliancewith
theanti‐moneylaunderingobligationsisfullymet.Ifyouhaveanyquestionswith
regardtoanyaspectoftheguide,pleasedonothesitatetocontacttheGlobal
ExpressComplianceOfficeat1(800)989‐6669.
GlobalExpresstakesitsresponsibilityundertheanti‐moneylaunderinglawsvery
seriouslyandthecompanyexpectsallofitstrusteestodemonstratethesamelevel
ofconcern.Pleaserememberthatfailuretomaintaintherequiredcompliance
programandprocedures,recordkeepingandreportingcanresultintheimposition
ofcivilorcriminalsanctionsbytheIRS,aswellastheterminationofthetrust
agreementbyGlobalExpress.
Regards,
GlobalExpress
ComplianceOffice
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GLOBALEXPRESSMONEYORDERS,INC.,
MONEYLAUNDERINGPREVENTIONANDCOMPLIANCEGUIDE
FORTRUSTEES
 Money laundering is an attempt to conceal or disguise the nature,
location,source,ownershiporcontrolofmoney.
 TheU.S.BankSecrecyAct(“BSA”),asamendedbytheUSAPATRIOTAct
of 2001, provides the federal government with the legal authority to
issue the BSA record keeping and reporting regulations designed to
helppreventmoneylaundering.
 Money laundering is not limited to cash transactions. Money
launderingcanandsometimesdoesinvolvemoneyorders.
 Thepurposeofthispamphletistofamiliarizeyouwiththeregulations
thatrequireyourcompliancewiththefederalregulationsdesignedto
preventmoneylaundering.
Global Express strictly adheres to the anti‐money laundering laws and
regulations and it expects that all Global Express money order trustees will
comply with these laws and regulations. Global will not do business with
trusteeswhodonotcomplywiththeseregulations.
GlobalExpresshaspolicies/proceduresineffecttouncoverviolationsofthe
regulations.Thefollowingregulationsaffectyouasasellerofmoneyorders–
a“MoneyServiceBusiness”undertheBSAregulations.Thereareseverecivil
and criminal penalties for not following these reporting and record‐keeping
regulations.Pleasenotethatthisguideisnotasubstitutefortheregulations
published at 31 C.F.R. Chapter 10, nor is this guide legal advice. If you need
legaladviceregardingtheimpactandscopeofthelaworregulations,please
contactyourlawyer.
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COMPLIANCEREQUIREMENTS
A. MoneyOrderLogRequirement
Ifsomeoneusescashtopurchasemoneyorderstotalingatleast$3,000but
notmorethan$10,000(includingfees)ineitheronetransactionoraseriesof
transactions,thetrusteemustkeepdetailedrecordsofthepurchaser(s)and
verifytheidentificationofthepurchaser–thisisthe“log”requirementunder
theBSArules.Theserecordsmustbemaintainedforfive(5)yearsandbe
availabletotheSecretaryoftheTreasuryuponrequest.Asamplemoney
orderlogisincludedattheendofthisComplianceGuide.
Alwaysverifytheidentificationofthepurchaserandobtainthefollowing
information:
1. Formofidentification
2. Nameandaddressofthepurchaser
3. SocialSecuritynumberoralienidentificationnumber
4. Dateofbirthofthepurchaser
5. Dateofpurchase
6. Locationofpurchase
7. Typeofinstrument,serialnumbersandtotalnumberofinstruments
purchased
8. Dollaramountpurchasedandtheamountofeachinstrument
9. Ifthepurchaserisbuyingtheinstrumentsonbehalfofanotherperson,
thesameinformationrequiredforline1through4isalsoneededfor
thatperson
***Anyonewhodoesnotcomplywiththeaboverequirementsmaybe
subjecttopenaltiesassessedbythegovernment.***
B.CurrencyTransactionReport(CTR)
MoneyordertrusteesarerequiredtoreporttotheIRSanycurrency
transactionsover$10,000(includingfees),byelectronicallyfilingaCTR
(FinCENReport112).Thecustomer’sidentitymustbeverifiedbyan
examinationofadocumentnormallyacceptableasameansofidentification
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whencashingchecks(e.g.,adriver’slicensewithaphotograph)andwhich
containsthenameandaddressofthepurchaser.
Wheretofile:
http://bsaefiling.fincen.treas.gov/main.html.NewUsers:select“Becomea
BSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
Whentofile:
Filenolaterthan15calendardaysafterthetransactiondate.
CTRs(andmailingreceipts,ifavailable)mustbemaintainedbyyoufora
periodoffive(5)yearsandmadeavailabletothegovernmentuponrequest,
asinthecaseofaBSAcomplianceexaminationbytheIRS.
C.SuspiciousActivityReport(SAR)
ASAR(FinCENReport111)mustbeelectronicallyfiledwhenevera
transactioninvolvesoraggregatesfundsofatleast$2,000andthetrusteeor
employeesuspectsthatthetransaction:
 Involvesfundsfromillegalactivity
 Isintendedorconductedinordertohideordisguisefundsorassets
derivedfromillegalactivity
 Isdesignedtoevadereportingorrecord‐keepingrequirements;or
 Servesnobusinessorapparentlawfulpurpose
ASARmaybefiledforanysuspicioustransactionoractivityevenifthedollar
amountislessthan$2,000.
Thetrusteeoremployeeshouldattempttoobtainasmuchinformationas
possibleaboutthecustomerandtransaction.
Wheretofile:
http://bsaefiling.fincen.treas.gov/main.html.NewUsers:select“Becomea
BSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
Whentofile:
Filenolaterthan30calendardaysafterdetectingthesuspiciousactivity.
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SARsmustbemaintainedbyyouforaperiodoffive(5)yearsandmade
availabletothegovernmentuponrequest.
Itisacriminaloffensetonotifyanypersoninvolvedinthetransaction
thataSARhasbeenreported.Ifyouhaveanydoubtsaboutatransaction,
erroronthesideofcaution–filetheSAR.
IfarepresentativefromFinCENoranappropriatelawenforcementor
supervisoryagencycomestoinspect,orarequestismadeforinspectionof
SARsupportingdocument(s),hisorhercredentialsmustbepersonally
inspectedtoverifytheiridentity(ies)andagencyauthority.
SuspiciousActivityInvolvingStructuringtoAvoidReports/FalseReports
Moneyorderpurchasersmaytrytostructuretheirtransactionstoavoidthe
reportingrequirements;or,purchasersmayaskyounottofileareportorto
fileafalsereport.YoumustreporttotheIRSifthereisreasonablecauseto
believethatapurchaserhasdoneanyofthefollowing:
a.Caused(orattemptedtocause)areportnottobefiled.
b.Caused(orattemptedtocause)areporttobefiledthatcontainsa
materialomissionormisstatementoffact.Materialomissionor
misstatementincludesafalsename,address,taxpayerIDnumber,or
businessoroccupationbythepurchaserorthemoneyorderagent.
c.Structured(orassistedorattemptedto“structure”atransaction).
Structuringmeansdividingatransaction,whichwouldotherwisebe
reportableintotwoormoretransactions.Forexample,thiscouldinvolve
thesamepersonbuying$2,000worthofmoneyorderseachdayfortwo
orthreedaysinarow.
AdditionalSuspiciousTransactions
Moneyorderpurchasersmaytrytoavoidthecurrencytransactionreports
(CTR)requirementsorthelogrequirements.Inaddition,youmaybelieve
thatthetransactionseems“suspicious”becauseit“servesnobusinessor
apparentlawfulpurpose”orisconsideredunusualforthatcustomeror
involvespotentialcriminalactivity.Forexample,youhavereasontobe
suspiciousofthetransactionif:
a. Severalpurchaserscomeintogetherbutpretendnottoknoweachother.
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b. Thepurchaserprovidesinconsistentanswerstoquestions.
c. Thesamepurchaserbuysmoneyordersmorethanonceinadayortwoor
threeconsecutivedays.
d. Thepurchaseroffersyouatiporbribeorothergift.
e. Thepurchaserbuysmoneyordersatmorethanoneofyourlocationson
thesameday.
f. Thepurchasesarejustbelowthe$3,000threshold.
g. Thepurchaseraskswhetherhispurchasewillbereportedorlogged.
Theseareonlysomeoftheexamplesofsuspiciousactivity;thisisnot
intendedasanallinclusivelist.Ifyouhavedoubts,filethereport!
NOTE:DonottellthepurchaserthatyouwillfileaSAR.
GlobalExpressurgesyoutoreportallsuspiciousactivitiestotheIRS.
EXAMPLESOFREPORTINGACTIVITY
Example1:Jimbringsin$12,000incashononeoccasionandrequestsa
moneyorder.YoumustfileaCTR.
Example2:Billbringsin$3500cashandbuysamoneyorder.Youmustkeep
alogofthetransaction.
Example3:Jimbringsincashonseveralseparateoccasionsduringthesame
dayandrequestsanumberofmoneyorders,whichintheaggregateexceed
$10,000(includingfees).YoumustfileaCTR/SAR
Example4:Jimbringsin$9,400incashandrequestsamoneyorder.The
nextdayJimagainbringsin$9,400incashandrequestsamoneyorder.Jim
maybeattemptingtoavoidthereportingrequirements.Youshouldconsider
whetherastructuredorsuspicioustransactionisoccurring.Ifyouconclude
thatastructuredorsuspicioustransactionisoccurring,youmustfileaSAR.
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Example5:YouseeJimandBillenteringyourpremisestogetherand
speakingwitheachother.Eachgivesyoujustlessthan$10,000incashand
requestsamoneyorder.JimandBillmaybeattemptingtoavoidthe
reportingrequirements.Youshouldconsiderwhetherastructuredor
suspicioustransactionisoccurring.YoumustfileaSAR.
Example6:YouseeJimhandcashtoBillandSusanoutsideyourstore.Bill
andSusangiveyoucashandrequestmoneyorders,eachofwhichislessthan
$10,000.Intheaggregate,themoneyordersrequestedbyBillandSusan
exceed$10,000.Thisappearstobeastructuredorsuspicioustransaction.
Jim,BillandSusanmaybeattemptingtoavoidthereportingrequirements.If
youconcludethatastructuredorsuspicioustransactionisoccurring,you
mustfileaSAR.Evenifyouconcludethatastructuredorsuspicious
transactionhasnotoccurred,ifyoubelievethatBillandSusanareactingon
behalfofJim,youmustfileaCTR.
FinancialInstitutionsHotline
TheU.S.DepartmentoftheTreasuryFinancialCrimesEnforcementNetwork
(FinCEN)hasestablishedaHotline,1‐866‐556‐3974,formoneyservices
businessessuchasmoneyordersellers,tovoluntarilyreporttolaw
enforcementsuspicioustransactionsthatmayrelatetorecentorpotential
terroristfinancialactivity.ThepurposeoftheHotlineistofacilitatethe
immediatetransmittalofthisinformationtolawenforcement.Hotlineuseis
voluntaryanddoesnotnegatetherequirementtotimelyfileaSAR.
SUMMARYOFBSAREQUIREMENTS
 Adetailedlogmustbekeptforanycashtransactionstotaling$3,000to
$10,000perdaytooneindividual.
 Thelogmustbekeptbythetrusteesinacentralizedlocationfora
periodoffive(5)years.
 Trusteesmustreportalltransactionsinvolvingover$10,000.A
CurrencyTransactionReport(CTR)mustbeelectronicallyfiledwith
theIRSwithin15days.
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 Trusteesmustreportallsuspicioustransactionsinvolvingatleast
$2,000ormoreonaSuspiciousActivityReport(SAR),whichmustbe
electronicallyfiledwiththeIRSwithin30days.ASARmaybefiled
evenifthedollaramountislessthan$2,000.
 Potentialmoneylaundering,transactionsthatarestructuredtoavoid
reportingrequirements,fraudandanyotherillegalactivityinvolving
theuseoffunds,comeundertheumbrellaofsuspiciousactivity.
Structuringsalestoavoidreportingorloggingisillegal.
 Atrusteewhosellsmoneyordersknowingthatthefundsusedforthe
purchaseareproceedsofillegalactivities,couldbesubjectto
prosecution.“Knowing”meansbeingsuspiciousandfailingtoask
questions.
 Itisillegaltocompleteatransactionwhichconcealsanimportantfact
i.e.truepurchaser’sname,address,etc.
Thebestpolicyis:
 Knowyourcustomer.
 Watchforrelatedcustomersi.e.membersofthesamefamily,persons
enteringyourbusinessatthesametimeandbuyinglargedollarvalue
moneyorders,etc.
 Watchforcustomersmakinglargedollarpurchaseswithsmaller
denominationsofcurrency($20billsandunder.)
TRAINING,COMPLIANCEOFFICER,ANNUALCOMPLIANCEREVIEW
Underregulationspromulgatedbythegovernment,moneyordersales
outlets,“trustees,”mustnowensurethatthepoliciesandproceduressetforth
areunderstoodandutilizedbythetrusteeanditsmoneyordersales
employees,i.e.,thoseemployeeswhodealwiththepublicinsellingmoney
orders.Also,underthesenewregulations,asatrustee,youmustdesignatea
“complianceofficer”whosefunctionistoensurethattherecordkeepingand
reportingrequirementsareunderstoodandcompliedwithbytrustee’s
employeesinthecourseofmoneyordersalesactivities.Thecompliance
officerhastheresponsibilityoftrainingeachretailsalesemployeeinthe
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courseofmoneyordersalesactivities.Thecomplianceofficerhasthe
responsibilityoftrainingeachretailsalesemployeeconcerningthevarious
recordkeepingandreportingrequirements,assetforthabove,aswellas
providingperiodicreviewsofemployeecompliancewiththeserequirements.
Inparticular,thecomplianceofficermustensurethatthe“log”iscomplete,
suspiciousactivity(SAR)reportsandCTR’sarebeingfiledandeachSARand
CTRisreviewedforcompletenessandaccuracybeforeitisfiled.Inaddition,
thecomplianceofficershouldmaintainupdatedcopiesofthiscompliance
manualandmustensurethatperiodicprogramcompliancereviewsare
conductedatleastannuallyandcorrectiveactionstakenifnecessary.Finally,
thecomplianceofficermustensurethattherecordsrequiredaremaintained
forfiveyearsundertheBankSecrecyActandarekeptsecure–theseinclude
the“logs”andcopiesofCTRsandSARs.
Thecomplianceofficerisalsotheprimarycontactbetweentheagentandthe
stateorfederalofficials,suchastheIRS,duringregulatoryauditsorBSA
complianceexaminations.
Asindicatedabove,itisthecomplianceofficer’sresponsibilitytoensurethat
theannualreviewofthisanti‐moneylaunderingcomplianceprogramis
conductedusingin‐housepersonnel(otherthanthecomplianceofficer),oran
independententityofthetrustee’schoice.
Thescopeoftheannualprogramreview,asmandatedbylaw,istoensure
thateachofthetrustee’ssaleslocationsiscomplyingwiththisanti‐money
launderingcomplianceprogram.Thegoalofthereviewistoassist
managementindeterminingwhetherthepoliciesandproceduresarebeing
followed.Inaddition,theprogramreviewcanhelptoidentifyany
weaknessesinproceduresandtrainingandthatappropriatecorrective
measurescanbeidentifiedandimplemented.Oncetheannualprogram
reviewiscomplete,theresultsandanysuggestedcorrectivemeasureswillbe
reportedtotheappropriatemanagementlevelofficialofthetrustee.
Programreviewresultsmustbemaintainedforfiveyearsintherecordsof
thecompany.
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GLOBALEXPRESSBILLPAYMENTTRUSTEECOMPLIANCEINFORMATION
TrusteesofGlobalExpresswhoacceptBillPaymentsarerequiredtocomply
withtheBankSecrecyACT,(BSA),andPatriotACTof2001.
TherulesforBillPayTrusteesaresimilartotherequirementsforMoney
OrderTrustees.
Themajordifferenceisthatalogmustbecreatedforalltransactionsof
$3,000.00ormore,includingfees,inCASH,CHECK,MONEYORDERorany
othernegotiableinstrument.Thelogmustbekeptfor5years
Cashtransactionsover$10,000.00requireaCurrencyTransactionReport.
CurrencyTransactionReportmustbekeptfor5years
SuspiciousActivityReportsmustalsobefiledforany/alltransactionswhich
mayappearsuspiciousintheamountof$2,000.00ormore.(Seethe
SuspiciousActivitysegmentoftheComplianceGuideforwhatconstitutes
SuspiciousActivity.)
Billpaymentsbyconsumerstocontractedmerchantsarenotconsidered
moneytransmissionsunderthelawsofmoststatesandarenotregulatedby
theBSA,31C.F.R.§1010.100(ff)(5).Toconfirmtherequirementsforyour
state,pleasecontactyourlegaladvisorsoryourappropriatestateagency
whichoverseesBSA/AMLcompliance.
ShouldyouhaveanyquestionsregardingcomplianceforBillPaymentsvisit
theFincen.govsiteorcalltheGlobalExpressComplianceOffice800‐989‐
6669,extension422.
REGISTRATIONOFMSB’S
TheU.S.DepartmentoftheTreasurymayrequireyoutoregisterasaMoney
ServicesBusiness(MSB).TheMSBregistration(FinCENReport107)mustbe
filedelectronically.
Wheretofile:http://bsaefiling.fincen.treas.gov/main.html.NewUsers:select
“BecomeaBSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
SeetheFinancialCrimesEnforcementNetwork“AnswerstoFrequently
AskedQuestionsforMoneyServicesBusinesses”onpage26forguidance.
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OFACREGULATIONS
TheofficeofForeignAssetsControl(OFAC)oftheDepartmentofthe
TreasuryadministersandenforcesU.S.economicandtradesanctionsagainst
targetedforeigncountries,terroristsanddrugcartels.OFACrequires
businessestoidentifyandfreezetheassetsofthedesignatedentities.
OFACregulationsdonotcontainanexceptionfordeminimistransactions.It
isyourresponsibilitytoverifythattheperson/syouaredoingbusinesswith
arenotontheOFAClist.
Uponverificationthattheperson/sisontheOFAClistyoumustnotdo
businesswiththatpersonandmustnotifyOFACimmediately.CalltheOFAC
hotlineat800‐540‐6322.
AlistcalledtheSpeciallyDesignatedNationalsandBlockedEntitiesList
(SDN)identifiesmostindividualsandentitiesagainstwhomtheOFAC
restrictionsapply.Thislistchangesonaregularbasis.Youmayrefertothe
OFACwebsite(WWW.TREASURY.GOV/OFAC)forfurtherinformation.
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Howtosetupyour
Anti‐MoneyLaundering
ProceduresProgram
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DearTrustee:
GlobalExpressFinancialServicesComplianceDepartmentpresentstoyouthis
templateofacompliancepolicytoassistyouinestablishingyourownAnti‐money
LaunderingComplianceProgramasrequiredbytheUSAPatriotActof2001,for
MoneyServicesBusiness.
Thepurposeofthe“PatriotAct”istopreventourfinancialsystemsfrombeingused
forillegalactivities.ThePatriotActmakesitmandatoryforallMoneyServices
Businesstoimplementacomplianceprogram,whichincludesadesignated
complianceofficer,proceduresandpoliciesforinternalcontrols,anemployee
trainingprogramandaprogramaudit.
Thistemplatewillguideyouinansweringthefollowingquestions:
WhataretheresponsibilitiesofaComplianceOfficer?
Whatpolicies,proceduresandinternalcontrolsmustbeimplementedtocomply
withthePatriotAct/BankSecrecyActcoveringcurrencytransactionreporting,
suspiciousactivityreporting,training,compliancemonitoringandexaminationsby
theIRS?
Trainingtheemployeestorecognizewhatconstitutesmoneylaunderingandwhatis
asuspiciousactivity?
Whatshouldtheauditoftheprograminclude?
Thistemplateshouldbeadaptedtofityourownspecialbusinessrequirements.If
yourbusinesshasalreadyestablishedacomplianceprogramyoumayusethis
templatetofurtherrefineorexpandyourprogram.
GlobalExpressneitherwarrantsnorindemnifiestheuseofthisinformation.
Thismaterialdoesnotconstitutelegaladvice.Directyourspecificlegal
questionstoyourattorney.
GlobalExpressMoneyOrders,Inc.
ComplianceOfficer
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COMPLIANCEOFFICERRESPONSIBILITIES
ThecompanyhasestablishedandmaintainsatalltimesadesignatedCompliance
OfficerpositiontooverseeandmonitoritsAnti‐MoneyLaunderingProgramas
requiredbytheUSAPatriotActof2001.Thecompanymanagementhasappointed
thisindividual.
ThedutiesandresponsibilitiesoftheAnti‐MoneyLaunderingComplianceOfficer
positionareoutlinedbelowandmaybeinadditiontootherdutiesand
responsibilitiesoftheappointedindividual.
TheComplianceOfficerhastheoverallresponsibilityforinstitutingandmaintaining
thecompany'sAnti‐MoneyLaunderingComplianceProgram,withthefollowing
responsibilities:
PoliciesandProcedures:
1.Establishesandupdatesinternalpoliciesandproceduresforthecompletion,
review,submissionandretentionofallreportsandrecordsrequiredunderthe
USAPatriotActandBankSecrecyAct.
2.Establishesaninternalreferralprocessandproceduresforcompliance
matterssuchashandlingofsuspicioustransactions,respondingto
Governmentofficials.
3.WorkwiththeCompanymanagementtoimplementpolicies,proceduresand
internalcontrolstocorrectcompliancedeficiencies,enhancecompliance
performanceandadapttoregulatorychanges.
Training:
1.ManagesandupdatestheEmployeeTrainingProgramtoensurethat
employeesreceiveaninitialandannualrefreshertrainingonBSA,Anti‐Money
LaunderingandCurrencyTransactionReportingandSuspiciousActivity
Reporting.
2.Providessupplementaltrainingasneededtoaddresscompliancedeficiencies
notedthroughmonitoringandauditactivities.
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Monitoring:
1. Monitorsdailyreportsandinvestigatesanysignificantdeficiencies.
2. ReviewsallCTRs,SARs,andotherreportsforaccuracyandcompleteness
beforefilingthemwiththeIRS.
3. Monitorsemployeecompliancewithpoliciesandprocedures.
4. Identifiesneedforandimplementscorrectiveaction.
5. Ensuresthatperiodiccomplianceauditsareconductedatleastannuallyand
correctiveactiontakenasneeded.
Record‐Keeping:
1. MaintainscomplianceManualsandprogrammaterial.
2. MaintainsBSArecordsfor5years.
Other:
1. Servesastheprimarycontactbetweenthecompanyandauditors,Stateor
IRSofficialsduringauditsorcomplianceexams.
2. Coordinatestheprocessforidentifyingunusualtransactions,completingand
filingSARsinvolvingsuspectedillegaltransactions.
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COMPLIANCEPOLICIESANDPROCEDURES
ThisCompany’spolicyistostrictlyenforceallapplicablemoneylaunderinglaws
andregulations,includingthoseoftheUSAPatriotActandBankSecrecyAct,andto
takeallstepsnecessarytopreventdetectandreportpossiblemoneylaunderingand
suspiciousactivities.
Cashreceiptsfromorcashpaymentstoacustomeroronbehalfofasinglecustomer
totalingmorethan$10,000.00(includingfees)inadayaredocumentedbythis
CompanyelectronicallyfilingaCTR(FinCENReport112).
1.ACurrencyTransactionReport(CTR)iscompletedbytheComplianceOfficer
oradesignatedemployee.
2.TheComplianceOfficerelectronicallyfilestheCTRonlineat
http://bsaefiling.fincen.treas.gov/main.html.NewUsers:select“Becomea
BSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
3.TheCompanykeepscopiesoftheCTR’sfor5yearsfromthedatefiled.
MONEYORDERLOGPROCEDURE
TheMoneyOrderLogiscompletedby___________________________formoneyorder
purchasesof$3,000to$10,000(includingfees)byoronbehalfofonecustomerina
day.
The“Log”containsthecustomer’sname,address,SocialSecurityNumber,birth
date,transactiondatemoneyordernumbers,amounts,numberofmoneyorders
purchased,customer’stypeofidentificationandclerk’sinitials.
TheCompanykeepstheMoneyOrderLogfor5yearsfromtransactiondate.
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SUSPICIOUSACTIVITYREPORTINGPOLICY
ASARmustbefiledforanytransactionthatis$2,000ormoreandissuspicious.A
SARmaybefiledforanydollaramountifthetransactionlookssuspicious.
Suspiciousactivityincludespossibleattemptstolaundermoney,structuring
transactionstoavoidreportingandrecordkeepingrequirements,transactionsthat
servenobusinessorapparentlawfulpurposeorareconsideredunusualwithno
reasonableexplanation,oranyothertransaction,whichappearstoinvolvecriminal
activity.
Theemployeemustattempttoobtainasmuchinformationaboutthecustomerand
thetransactionaspossibleforthecompletionoftheSAR.
Theemployee,undernocircumstance,shouldinformthecustomerthataSARis
beingfiled.
SARsaretobecompletedby____________________________,andreviewedand
electronicallyfiledbytheComplianceOfficer.
TheComplianceOfficerwillelectronicallyfiletheSAR(FinCENReport111)online
athttp://bsaefiling.fincen.treas.gov/main.htmlwithin30daysofdetectingthe
suspiciousactivity.
EMPLOYEETRAINING
Theemployeesaretrainedonthefollowingcomplianceissues:
1. USA/PatriotAct/BankSecrecyActCompliance.
2. Suspiciousactivityidentificationandreporting.
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PERIODICCOMPLIANCEREPORT
DATE:_____________________
YES(Y)NO(N)
1. CTR'sarecompletedforallcashtransactionsover$10,000.00.________(Y/N)
2. CTR'sarefiledwiththeIRSwithin15daysoftransactions._________(Y/N)
3. Moneyorderlogsarepreparedforalltransactionsof$3,000to$10,000.
_________(Y/N)
4. Moneyorderlogsarecompletedandaccurate._____________(Y/N)
5. SAR'sarebeingcompletedfortransactionsof$2,000ormorethatare
suspiciousandalltransactionsthataresuspiciousregardlessofamount.
________________(Y/N)
6. SAR'sarefiledwithin30daysofdetection._______________(Y/N)
7. NewemployeesarebeingtrainedonAMLcomplianceprocedures.
__________________(Y/N)
Explainallnoresponses.
____________________________________
AuditorSignature
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AnswerstoFrequentlyAskedQuestions(FAQs)forMoneyServices
Businesses(MSBs)
Registration:
1.Question:WhoisrequiredtoregisterasaMoneyServicesBusiness
(MSB)?
AbusinessisanMSBandmustregisterifitconductsmorethan$1,000in
businesswithonepersoninoneormoretransactions(inanycategoryof
activitylistedbelow)onthesamedayinoneormoreofthefollowing
services:
 MoneyOrders
 Traveler’sChecks
 CheckCashing
 CurrencyDealingorExchange
ORthebusinessprovidesMoneyTransferservicesinanyamount.
2.Question:WhenmustanMSBregisterwithFinCEN?
ThedeadlineforfilingtheMSBregistrationform(Fincen107)wasDecember
31,2001.ForthoseentitiesthatbecomeMSBsafterDecember31,2001,the
registrationdeadlineis180daysaftertheMSBisestablished,countingfrom
thedayafterthedateofestablishment.
3.Question:Whoisnotrequiredtoregister?
TheMSBRegistrationrequirementdoesnotapplyto:
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 TheU.S.PostalService;
 AnyagenciesoftheUnitedStates,ofanyState,orofanypolitical
 subdivisionofaState:
 Anissuer,sellerorredeemerofstoredvalue;
 AbusinessthatisanMSBsolelybecauseitservesasanagentof
anotherMSB.However,ifabusinessthatisanagentforanother
MSBalsoengagesinMSBactivitiesonitsownbehalf,suchas
cashingchecksonitsownbehalfforanypersonofover$1,000in
oneormoretransactionsduringaday,thebusinessisrequiredto
register.
 Banks(includingcreditunions)andpersonsregisteredwith,and
regulatedorexaminedbytheSecuritiesandExchangeCommission
orCommodityFuturesTradingCommissionarenotrequiredto
registerbecausetheyarenotMSBs.However,ifsuchanentityhasa
moneyorderdivisionwithagentsoramoneytransmissiondivision
withagents,thoseagentsmayberequiredtoregisterbecausethey
arenotagentsofanMSB.
4.Question:WhenmustanMSBrenewitsregistration?
MSBsthatwereinitiallyrequiredtoberegisteredonorbeforeDecember31,
2001,wererequiredtorenewtheirregistrationforthefirsttimeby
December31,2003.Thereafter,theirrenewalisrequiredevery24months
(onorbeforeDecember31,2005,December31,2007,etc.).MSBsthatcame
intoexistenceafterDecember31,2001,areinitiallyrequiredtoberegistered
within180daysbeginningonthedayafterthebusinessisestablishedasan
MSB.
Theirrenewaldeadlineistheendofthe2‐calendaryearperiodbeginningin
theyeartheyinitiallywererequiredtoberegistered.Forexample,ifanMSB
isrequiredtoberegisteredonOctober15,2002,itmustrenewbyDecember
31,2003.Thereafter,renewalisrequiredevery24months(onorbefore
December31,2005,December31,2007,etc.).IfanMSBisrequiredtobe
registeredonOctober15,2003,itmustrenewbyDecember31,2004,and
every24months(onorbeforeDecember31,2006,December31,2008,etc.).
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ForMSBregistrationrenewal,checkItem2b(2YearUpdate)onthe
RegistrationofMoneyServicesBusinessForm(Fincen107).
5.Question:WhateventswouldrequireanMSBtore‐register?
MSBsmustre‐registerifthereis:
 Changeinownershiporcontrolthatrequiresthebusinesstore‐
registerunderStatelaw;
 Transferofmorethan10percentofthevotingpowerorequity
interests;
 Amorethan50percentincreaseinthenumberofagentsduringthe
registrationperiod.
ForMSBre‐registration,checkItem2c(Refilingbecause:Checkallthat
apply.)ontheRegistrationofMoneyServicesBusinessForm(Fincen107).
6.Question:HowdoIsubmittheMSBregistrationform?
TheMSBRegistrationform(Fincen107)mustbecompletedandfiled
electronically.
Wheretofile:
http://bsaefiling.fincen.treas.gov/main.html.NewUsers:select“Becomea
BSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
Keepacopyoftheregistrationformfor5years.
7.Question:WhatarethedeadlinesforpreparationoftheinitialAgentList
andtherevisedAgentList?
MSBsthatarerequiredtoregistermustprepareandmaintainalistoftheir
agents,ifany,everyJanuary1stforthepreceding12‐monthperiod.Foran
MSBinexistenceonorbeforeDecember31,2001,theinitiallistofagents
mustbepreparedbyJanuary1,2002,andmustberevisedeachJanuary1,for
theimmediatelypreceding12‐monthperiod.ForMSBsestablishedafter
December31,2001,theinitialagentlistmustbepreparedbytheduedateof
theinitialregistrationform,whichis180daysaftertheMSBisestablished,
countingfromthedayafterthedateofestablishment,andmustberevised
eachJanuary1fortheimmediatelypreceding12‐monthperiod.
8.Question:WhatisanAgent?AnIssuer?ARedeemer?
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 ForpurposesoftheMSBregistrationrequirement,anagentisa
businessthatanissuerauthorizes,throughwrittenagreementor
otherwise,tosellitsinstrumentsor,inthecaseoffunds
transmission,tosellitssendandreceivetransferservices.
 Anissuerisabusinessultimatelyresponsibleforpaymentofmoney
ordersortraveler’schecksasthedrawerofsuchinstruments,ora
moneytransmitterthathastheobligationtoguaranteepaymentof
amoneytransfer.
 Aredeemerisabusinessthatacceptsinstrumentsinexchangefor
currencyorotherinstrumentsforwhichitisnottheissuer.For
example,ahotelthatprovidesacustomerwith$1,500incashin
exchangeforthecustomer’s$1,500moneyorder(issuedbyanother
MSB)isaredeemer.TheMSBdefinitionin31CFR103.11(u)(4)
extendsto“redeemers”ofmoneyordersandtraveler’schecksonly
insofarastheinstrumentsinvolvedareredeemedformonetary
value–thatis,forcurrencyormonetaryorothernegotiableor
otherinstruments.Thetakingoftheinstrumentsinexchangefor
goodsorgeneralservicesisnotredemptionunderBSAregulations.
9.Question:Whatisthedifferencebetweenabranchandanagent?ShouldI
completeanMSBRegistrationformforeach?
AbranchisaplaceofoperationthatisownedbytheissueroftheMSB
productorservice.Anissuermayhavenumerousbranches(whichareowned
bytheissuer)throughwhichtheissuersellsitsowninstrumentsortransmits
funds.AnMSBisnotrequiredtoregisterseparatelyeachofitsbranches.For
purposesoftheMSBregistrationrequirement,anagentisaseparatebusiness
entityfromtheissuerofanMSBproductorservice.Theissuerauthorizesits
agents,throughwrittenagreementorotherwise,tosellitsinstrumentsor,in
thecaseoffundstransmission,tosellitssend‐and‐receivetransferservices.
AnMSBagentshouldnotberegisteredifitisanMSBsolelybecauseitisan
agentofanotherMSB;rather,theissuermustlisttheagentontheissuer’s
agentlist.
10.Question:HowdoIgetproofthatIhaveregisteredasanMSB?Ifabank
asksforproofthatIhaveregistered,whatdoIshowthem?
YouwillreceiveanacknowledgementletterfromtheDetroitComputing
Centerwithinfourtosixweeksafteryoufileyourregistration,alongwitha
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facsimileoftheregistrationformyoufiled.Checkthefacsimiletoensurethat
alltheinformationiscorrect;ifso,keepitforyourrecordsfor5years.If
thereareerrors,correctthem,andmailbacktothesameaddressasindicated
intheinstructions.Thisistheonlyproofofregistrationthatyouwillreceive.
Showtheletterandacopyoftheregistrationformyoufiledtothebank.If
youhavenotreceivedanacknowledgementletterwithinareasonable
amountoftime,orifyouhavelostyourletter,writetorequestaletterfrom
theDetroitComputingCenter,Attn:J.McRae,P.O.Box32063,Detroit,MI
48232‐orcall1‐800‐800‐2877.
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ReportingSuspiciousActivity
1.Question:WhichMSBsarerequiredtoreportsuspiciousactivities?
TherequirementthatMSBsfileaSuspiciousActivityReport(SAR)applies
onlytomoneytransmitters,currencydealersorexchangersandissuers,
sellersandredeemersofmoneyordersandtraveler’schecks.Itdoesnot
applytocheckcashersortoissuers,sellers,orredeemersofstored
value.However,anyMSBmayvoluntarilyfileaSARforanysuspicious
transactionthatitbelievesisrelevanttothepossibleviolationofanylawor
regulation,butwhosereportingisnotrequired.Astatutorysafeharborfrom
liabilityforreportingapplieswhetherthefilingisvoluntaryorrequired.
2.Question:WhenmustMSBsbegintoreportsuspiciousactivitiestoFinCEN
andhowaretheytobereported?
Moneytransmittersandissuers,sellers,orredeemersofmoneyordersand
traveler’scheckswererequiredtobeginreportingsuspicioustransactions
occurringafterDecember31,2001.Currencydealersorexchangersare
requiredtofileSARsbeginningonAugust11,2003.MSBsmustfile
electronicallyat:http://bsaefiling.fincen.treas.gov/main.html.NewUsers:
select“BecomeaBSAE‐Filer”.ExistingUsers:select“E‐FilingSystemLog‐In”.
3.Question:WhenisanMSBrequiredtofileaSAR?
AnMSBisrequiredtofileaSARonatransactionorseriesoftransactions
conductedorattemptedby,at,orthroughtheMSBifbothofthefollowing
occur:
 Thetransactionorseriesoftransactionsinvolvesoraggregates
fundsorotherassetsof$2,000ormore,AND
 TheMSBknows,suspects,orhasreasontosuspectthatthe
transaction(orapatternoftransactionsofwhichthetransactionis
apart)fallsintooneormoreofthefollowingcategories:
1. Involvesfundsderivedfromillegalactivityorisintendedor
conductedinordertohideordisguisefundsorassets
derivedfromillegalactivityaspartofaplantoviolateor
evadeanyfederallaworregulationortoavoidany
transactionreportingrequirementunderfederallawor
regulation;or
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2. IsdesignedtoevadeanyBankSecrecyActregulations;or
3. Hasnobusinessorapparentlawfulpurposeorisnotthesort
inwhichtheparticularcustomerwouldnormallybeexpected
toengageandtheMSBknowsofnoreasonableexplanation
forthetransactionafterexaminingtheavailablefacts,
includingthebackgroundandpossiblepurposeofthe
transaction.
4. Involvesuseofthemoneyservicesbusinesstofacilitate
criminalactivity.
Anissuerofmoneyordersortraveler’schecksisrequiredtoreport
atransactionorpatternoftransactionsthatinvolvesoraggregates
fundsorotherassetsof$5,000ormorewhentheidentificationof
thetransactionsassuspiciousisderivedfromareviewofclearance
recordsorothersimilarrecordsofmoneyordersortraveler’s
checksthathavebeensoldorprocessed.
4.Question:WhatisthedeadlineforfilingaSAR?
AnMSBisrequiredtofileeachSARnolaterthan30calendardaysafterthe
dateoftheinitialdetectionbytheMSBoffactsthatmayconstituteabasisfor
filingaSAR.
5.Question:I’mworriedaboutbeingsuedbythecustomerifIfileaSAR.
HowdoIavoidbeingsued?
Federallaw(31U.S.C.5318(g)(3))providesa“safeharbor”orprotection
fromcivilliabilitytofinancialinstitutionsandtheirdirectors,officers,
employeesoragentswhoreportsuspiciousactivitytoFinCENorappropriate
lawenforcementorsupervisoryagencies.Afinancialinstitutionisprohibited
fromnotifyinganypersoninvolvedinthetransactionthatthetransaction
wasreportedonaSAR(31USC5318(g)(2)).Ifyoureceiveasubpoenafora
SAR,orarequestofanykindtoproduceacopyofaSAR(otherthanarequest
byFinCEN,oranappropriatelawenforcementorsupervisoryagency),you
shouldcontactFinCEN’sOfficeofChiefCounselat703‐905‐3590
immediately.
6.Question:I’mworriedaboutdamagingsomeone’sreputationorgetting
someoneintroubleifI’mwrongaboutatransactionbeingsuspicious.What
happenstoSARsaftertheyarefiledandwholooksatthem?
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ASARisnotanaccusationagainstsomeoneoranallegationthattheyhave
committedacrime.ASARindicatesthatatransactionseemssuspicious.SARs
arenotdisseminatedtothepublic;rather,theyareprovidedonlyto
appropriatelawenforcementandfinancialsupervisoryagencies.
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FORMSSECTION
BSAE‐FilingSystem
FinCENReport•RegistrationofMoney
ServicesBusiness
FinCENReport111•SuspiciousActivityReport
byMoneyServicesBusiness
FinCENReport112•CurrencyTransactionReport
MoneyOrderTransactionLog
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