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#336706 - 03/21/05 09:48 PM Wal-Mart as a MSB
Princess Leia Offline
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This is an interesting article about Wal-Mart and their desire to expand their financial services presence that was in yesterday's local paper.

Bargain-bin banking grows at Wal-Mart
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#336707 - 03/21/05 10:29 PM Re: Wal-Mart as a MSB
Andy_Z Offline
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I didn't know they were wiring funds. Most of the WalMarts I see have banks in them and they don't generally compete with them. And yes, they have tried to get into banking. And oddly enough, the Walton family owns a bank. Why they don't get some exclusivity I don't know.
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#336708 - 03/21/05 10:32 PM Re: Wal-Mart as a MSB
Princess Leia Offline
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I didn't know they were wiring funds either - maybe it's a regional thing. I sent my mom to check out the Super Walmart in my hometown.

I'm tempted to go there to send a wire to see what kind of OFAC checking they do
Last edited by Princess Leia; 03/21/05 10:33 PM.
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#336709 - 03/21/05 10:42 PM Re: Wal-Mart as a MSB
Elwood P. Dowd Offline
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deppfan noted Wal Mart's MSB status a few weeks ago here. She didn't seem to happy about it.
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#336710 - 03/21/05 10:48 PM Re: Wal-Mart as a MSB
Jokerman Offline
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Quote:

Why they don't get some exclusivity I don't know.




I'm no anti-trust attorney, but that would seem much more anticompetitive that providing a web-browser that's already available for free along with an operating system.

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#336711 - 03/30/05 09:08 PM Re: Wal-Mart as a MSB
Peridot Offline
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I am very confused about this Wal-Mart issue. In looking at the definition of a MSB, it does not include "a person registered with, and regulated or examined by, the Securities and Exchange Commisssion or the Commodity Futures Trading Commission." I took this to mean that if they are a registed entity, which Wal-Mart is, they are excluded from the definition of a money service business? I thought I had this thing figured out, but, apparently not. If we have to monitor our Wal-Mart's cash deposits, this is going to be a nightmare!
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#336712 - 03/31/05 01:28 PM Re: Wal-Mart as a MSB
Anonymous
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Does anyone know what to do if you have an MSB that is publicly traded? I have the Arkansas MSB list printed out that shows what activities Wal-mart does, but don't know what else to do. Since they are publicly traded do we have to do the same MSB monitoring, check for AML procedures, etc. And of course Wal-Mart - being a publicly traded company - is on our exempt list. Now what??

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#336713 - 03/31/05 02:37 PM Re: Wal-Mart as a MSB
Anonymous
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I'd personally like to see Wal-Mart's AML Program. Let them screw up (Can you say Am-South, Riggs, etc.) and we'll see how fast the negative publicity from providing services to a know or suspected terrorist, drug dealer may make them think twice about getting into a business they don't know much about. It's gonna happen (muhahaha) if it's not already happening.

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#336714 - 03/31/05 04:19 PM Re: Wal-Mart as a MSB
Anonymous
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I couldn't have said it better myself. We have contacted the OCC and are waiting their reply on the situation.

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#336715 - 03/31/05 05:17 PM Re: Wal-Mart as a MSB
Anonymous
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I'm glad this thread re-surfaced. Earlier posts prompted me to full down FinCEN's latest MSB list. I was hoping that Wal-Mart would register at the store level. That would have made life relatively easier for me, as I'd hoped that I could at least work at an individual store account level. But nooooo, they registered at the corporate level. I talked to one of our Risk managers, and she suggested that the extent to which Wal-Mart was acting as an agent of another MSB, that would reduce our assessment of the risk. To the extent that they were working on their own, that would increase the risk. Two things I took away to research
(and if anyone knows offhand, please jump in...)
1. Are the money orders branded as "Wal-Mart" or are they someone else's?
2. Is Wal-Mart wiring money directly, or through another MSB (like Moneygram, ACE, or Western Union)? (The risk manager was particularly concerned about this activity.)

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#336716 - 03/31/05 05:44 PM Re: Wal-Mart as a MSB
Anonymous
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1. Their money otrders are branded Walmart
2. They wire up to $3000 a day to one person that can pick the wire up from another Walmart store.

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#336717 - 03/31/05 06:42 PM Re: Wal-Mart as a MSB
Anonymous
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Quote:


2. They wire up to $3000 a day to one person that can pick the wire up from another Walmart store.



Looking behind the curtain (and I haven't gone into the account transactions yet), are they actually doing a wire transfer? or are they doing some kind of store-account to store-account book transfer and calling it a wire?

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#336718 - 03/31/05 06:57 PM Re: Wal-Mart as a MSB
Princess Romeo Offline

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Quote:

Quote:


2. They wire up to $3000 a day to one person that can pick the wire up from another Walmart store.



Looking behind the curtain (and I haven't gone into the account transactions yet), are they actually doing a wire transfer? or are they doing some kind of store-account to store-account book transfer and calling it a wire?



A store account to store-account book transfer? Would that be like a HaWala-Mart?
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#336719 - 03/31/05 07:03 PM Re: Wal-Mart as a MSB
complianceman Offline
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I have completed some research on a local Wal-mart in my community and I think those concerned in this discussion should do the same.

The Wal-Mart in my community does issue Money Orders and does wire funds. But they are an Agent for MoneyGram and are listed on the MoneyGram Web site (www.moneygram.com) as an authorized agent. So in those two situations, they are NOT and MSB. The final determining factor is whether the Wal-Mart cashes checks in excess of $1,000 per person per day. If that is the case, they ARE a money service business and would have to register with FinCEN. But since they are not one of our customers, I haven't inquired about this.

I woudl suggest those who are debating whether a business customer is an MSB, ask question on who they use to Wire Transfers and Money Order issuance. Just because the Money Order is Branded Wal-Mart does not mean they have branding rights as an agent for the actual MSB.
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#336720 - 03/31/05 07:35 PM Re: Wal-Mart as a MSB
Anonymous
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Quote:

Quote:

Quote:


2. They wire up to $3000 a day to one person that can pick the wire up from another Walmart store.



Looking behind the curtain (and I haven't gone into the account transactions yet), are they actually doing a wire transfer? or are they doing some kind of store-account to store-account book transfer and calling it a wire?



A store account to store-account book transfer? Would that be like a HaWala-Mart?



Well, sure, the wire is redeemable in cash, lawn chairs, Snapple, and on Tuesdays, new CDs, DVDs and video games!

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#336721 - 04/01/05 01:48 AM Re: Wal-Mart as a MSB
Anonymous
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My WalMart has a sign that says they will cash checks up to a limit of $1,000 per day

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#336722 - 04/04/05 06:16 PM Re: Wal-Mart as a MSB
Anonymous
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If you go on FinCen they are registered as a MSB....The regional office is out of Arkansas.

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#336723 - 04/05/05 12:18 AM Re: Wal-Mart as a MSB
Anonymous
Unregistered

Quote:

If you go on FinCen they are registered as a MSB....The regional office is out of Arkansas.




That's their corporate headquarters, not a regional office.

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#336724 - 04/05/05 04:18 PM Re: Wal-Mart as a MSB
Anonymous
Unregistered

Regardless if it is regional or corporate.....they are registered as a MSB. Now what does the bank have to do for monitoring purposes?

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#336725 - 04/07/05 10:33 AM Re: Wal-Mart as a MSB
Elwood P. Dowd Offline
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There isn't a standard answer on what you have to do in terms of monitoring any customer. From a prior post:

...there isn't anything that says you can ignore their MSB status just because they are publicly traded. Using Wal Mart as an example, their eligibility for Phase I exemption has no legal effect on their status as an MSB.

However, the cloud that hangs over MSBs is one of presumptive risk; they have not been proven (as a class) to represent actual danger. In my opinion, the fact that a particluar MSB is publicly traded and listed on a major exchange dilutes any presumption of risk; i.e. it justifies a lower level of documentation.

To do anything less than require evidence of a BSA/AML and an OFAC program etc. you are going to have to assume your examiners are sophisticated and are not just marching in lockstep with the examination procedures. Your second assumption has to be that this relationship is profitable and you want to retain it.

If you can clear both hurdles, you might consider the examination procedures in their intended role, as "guidance" rather than as a checklist. Obviously, you can obtain evidence of the company's registration from the MSB web site. You can easily document the services they offer by visiting their local store. You might also contact the company's corporate headquarters and see if they can provide any documentary support for your attempt at flexibility. I'm tempted to say you could also monitor their activity, but if they do not segregate their deposits from MSB activity, I don't think that comment is realistic - there is simply a stream of cash going through your bank and its sources are not discernable. Finally, you should call the EIC from your last examination, verbally test your "light documentation" theory, and document the conversation.


Recent interagency guidance clearly indicates the presumptive risk theory is deteriorating. You may be able to note in your policies and procedures that you impose lesser documentation and monitoring requirements on companies which are publicly traded on a major exchange.

Somewhat cynically, it is worth noting that the folks at Wal Mart would likely call someone in Washington if banks started closing their accounts. Make no mistake, their call would be returned. No examiner with any sense is going to try and make an issue of whether your account with Wal Mart is as is as heavily documented and monitored as the one with "Joe's Check Cashing Service."

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