Good Afternoon,
We have TPPP customers (approx 5-6) who initiate ACH files through our bank and we have good documentation & EDD reviews on them. Now, we have a potential customer who contacted us today explaining that he needs business banking services for his new company - which is collecting unpaid debts. He is not new to the area, is known by bank personnel and has done this type of work previously - although he has never had banking services with us.

He will be collecting unpaid debts from businesses inside and outside the US, then wiring the payments to the company who is hiring him - a well known tire / rubber company in Tokyo.

Technically he will be a TPPP, although he is not moving funds via ACH.

What documentation do we need to obtain from him? I am asking for copies of his agreement with this company and have asked him to document and explain how he will be receiving payments whether by check or ACH. I have also instructed the branch to explain that we will be reviewing his activity on at least a quarterly basis and will periodically have to ask him for updated information.

Any further input will be appreciated and also, am I correct that he is a TPPP - he just has only one client.

Thanks.!

Maybe I'm not understanding this. Why would a tire/rubber company domiciled in Tokyo be funding a debt collector in the US?

Can you say money mule?

I knew you could...

Exactly my thoughts. Why would they hire someone on the other side of the world to collect business debts? If they are that large - and the legit company truly is large - surely they have someone on staff (more than one employee) who collects debt.

Thanks guys !

Know this is an old post but what did you do with this customer? We are trying to onboard a similar customer but they perform collections for many large retailers. Trying to determine what to collect before opening account. Thank you!

The most recent official guidance from the FDIC is FIL 41-2014. . It attempts to mask the stink the FDIC put on TPPP's in the past, but still links the previous guidance.

You have exhumed two old threads on the same subject where no real answer was offered. It seems likely that no one in this limited audience makes it a practice to bank TPPP's. If you are thinking about banking a customer that could fairly be labeled as inherently high risk, but have no idea where to start, that's probably the most reliable indicator that you shouldn't do it.

We already bank some TPPPs that are payroll processors but they were all inherited from bank acquisitions. The new potential customer is a debt collector.

Thank you for the guidance!