I should know this but want to ask to be certain.

We have a business that is a hispanic grocery store that does international money transmitting for its customer. Are they required to register as a Money Service Business (MSB)

Thanks

Unless they are acting as an agent of a registered MSB such as Money Gram or Western Union. Even then, you would want to perform some EDD on them. Your state may also have some registration requirements that you should check into.

IF the only MSB activity they perform is the international money transmitting function on behalf of another company, (Money gram, Western Union, etc.) then they do not need to register with FinCEN. They are an agent of the MSB, (Money gram, Western Union, etc.) Check with your state, They may need register there, and obtain a copy of the agent agreement for your ECDD.

beat me to it thomasj

Thanks

In this instance, would this customer be considered an MSB since they are just the agent? If not an MSB, what category do you classify them for doing enhanced due diligence on them?

Also check casher's that cash checks over $1,000 must register and are an MSB, but if they have small limits (like a small mom & pop grocery store with a limit of $100 per person per day), are they still considered to be an MSB?

An agent would be an MSB - they just do not have to separately register.

Mom and pop would not meet the definition of a MSB.

For the mom & pops, expect an examiner to inquire about how you monitor the account to verify that they are not cashing checks in excess of $1,000 (or multiple checks for the same person in excess of $1,000 in a single business day.)

Thanks rlcarey and BrianC. What if mom and pop also sells non-reloadable Gift cards to Amazon, JCPenney, ITunes, etc? Does this make them an MSB? Really confused on the Stored Value Cards too. Thank you for any help!!!

Yes, in the exam manual it states:

MSBs include … (4) providers or sellers of prepaid access;

An Amazon gift card is an example of a closed loop prepaid card. You can find more in the exam manual's section on Prepaid access: https://bsaaml.ffiec.gov/manual/ProductsAndServices/10

I disagree. Sellers of non-reloadable, closed-loop gift cards are not considered an MSB (as long as the cards aren't larger than $2000 - which I've never seen in the gift card end-caps in grocery stores).

https://bsaaml.ffiec.gov/manual/PersonsAndEntities/04

Thanks Justin, looks like you're right.