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#271593 - 11/05/04 03:10 PM MSB - Exceptions
SMQ, CRCM Offline
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Does anyone know if there are any exceptions for being a MSB? For example, if the public school system cashes its paychecks for its employees, could this be an exception? And if so, is it because they are cashing their own paychecks OR would it be because they are public funds?

Any other exceptions you care to share would be appreciated.

Thanks in advance.
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#271594 - 11/05/04 06:16 PM Re: MSB - Exceptions
MagicCity Offline

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Cashing your own payroll checks would not put you into the MSB category.

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#271595 - 11/05/04 06:33 PM Re: MSB - Exceptions
MAG Offline
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I have read that a customer who cashes checks totaling more than $1,000 in one business day would be considered a money service business.

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#271596 - 11/05/04 08:31 PM Re: MSB - Exceptions
MagicCity Offline

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That is correct.
But I do not believe it applies to persons or companies cashing their own checks.

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#271597 - 11/05/04 09:05 PM Re: MSB - Exceptions
SMQ, CRCM Offline
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Thanks Magic. That is what I was thinking too. It is so reassuring when someone (anyone) agrees with you. (That doesn't happen often in this job. Except here )
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#271598 - 11/05/04 09:48 PM Re: MSB - Exceptions
berico Offline
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California
We have also been told by FINCEN that cashing your own payroll checks for your employees does not make you a check casher (or MSB).

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#271599 - 11/06/04 03:29 AM Re: MSB - Exceptions
MagicCity Offline

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LOL SoccerMom !!

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#271600 - 11/08/04 09:46 PM Re: MSB - Exceptions
Runin' Reb Offline
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cute!
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#271601 - 11/23/04 02:59 AM Re: MSB - Exceptions
SMQ, CRCM Offline
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What about a furniture store that runs those tax refund sales? Buy some furniture and we will cash your check for you. They may cash a few checks with over a $1,000 cash back, but this is hardly how they make a living and they are not charging a fee for it. Are you classifying them as an MSB?

Thanks,
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#271602 - 11/23/04 07:50 AM Re: MSB - Exceptions
Princess Romeo Offline

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Quote:

What about a furniture store that runs those tax refund sales? Buy some furniture and we will cash your check for you. They may cash a few checks with over a $1,000 cash back, but this is hardly how they make a living and they are not charging a fee for it. Are you classifying them as an MSB?

Thanks,



They meet the test. I don't see how you can't UNLESS you can prove that the cash back was less than $1,000 (the rest going to the furniture) which is a documentary burden to say the least. I am thinking you will need a policy statement signed by the owners as well as a invoice to check match-up for any 3rd party check in excess of $1,000 in order to show the merchandise was the majority exhange, and cash-back was under $1,000. The cost for this kind of monitoring and audit will most likely make this account not profitable for you.

And I know that these stores will be offended, to say the least, when you tell them they are a Money Services Business and must register.
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#271603 - 11/23/04 08:55 PM Re: MSB - Exceptions
Anonymous
Unregistered

OMG --- another category of customers to watch!

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#271604 - 11/24/04 04:31 PM Re: MSB - Exceptions
Anonymous
Unregistered

This question has been addressed here earlier. When I called FinCen, I was told that the reg does not exclude employers who cash their own payroll checks. Therefore, if they cash a check for over $1000 for their employee, they are a money services business.

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#271605 - 11/24/04 05:59 PM Re: MSB - Exceptions
Princess Romeo Offline

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Quote:

This question has been addressed here earlier. When I called FinCen, I was told that the reg does not exclude employers who cash their own payroll checks. Therefore, if they cash a check for over $1000 for their employee, they are a money services business.




That is counter-intuitive! It would be one thing if the employer cashed checks from ANOTHER company, but they are only providing their own payroll to their employee. It would be no different than if they simply handed the employee the cash for their earned payroll.

I would call FinCEN back and ask them to double check. The purpose of requiring MSB registration is to monitor the activities of those who handle transactions of OTHERS, not transactions of their own.
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#271606 - 11/26/04 05:57 PM Re: MSB - Exceptions
Dolly Nugent Offline
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I disagree with the anonymous poster about a company cashing their employees paychecks. I asked our regulator (FDIC) the same question and I was told that the check cashing service needed to be available to the public. It simply doesn't make sense for to consider this type of check cashing MSB activity.

Sometimes the answer we get is determined by HOW we ask the question. I would call again and speak to another person for their take on this, but you can see from this post that many of us do not agree with this opinion.
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#271607 - 11/29/04 03:35 PM Re: MSB - Exceptions
Elwood P. Dowd Offline
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So far, the score seems to be two to one. FinCEN and FDIC (sources unnamed): "No they are not an MSB." FinCEN (source unnamed), "Yes, they are an MSB."

The MSB regulations don't create exceptions. The only argument you would have is that the employer is not doing business as a check casher and, thus it is not doing business as an MSB. Personally, I believe the interpretation is reasonable, but know that it could be stretched to cover some ridiculous situations. (As someone said here a few days ago in a similar circumstance: This employer is like a dolphin caught in a tuna net.)

My experience with FinCEN's telephone advice has been very positive (once I get to a live person), but on more than one occasion I have talked the respondent into a different answer than the first one I received. FinCEN personnel do not have a separate book with more rules - many times you are getting the opinion of the person who answered the phone. If you are going to rely on their advice it needs to be in writing on FinCEN letterhead.
Last edited by Ken_Pegasus; 11/29/04 03:53 PM.
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#271608 - 12/02/04 05:37 PM Re: MSB
Judy F Offline
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Does anyone have guidelines for how we monitor our customers to determine if they are MSB's?
Thanks!

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#271609 - 12/02/04 08:11 PM Re: MSB
trout22 Offline
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Joined: Nov 2004
Posts: 313
Sorry, I don't, but I am in need of some good guidelines to get me started in LOOKING for any possible MSB's that we have accounts with. If you get some guidelines, would you please share with me too?

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#271610 - 12/02/04 08:34 PM Re: MSB
Dolly Nugent Offline
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First look for businesses that make large cash withdrawals on a regular basis. They need cash to offer check cashing services.

Then get your tellers and operations officers to look at deposits. Look for evidence that your customer is cashing checks for individuals. Then determine if the customer meets the definition of a MSB.
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