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#858566 - 11/20/07 09:47 PM Cash Advance-MSB?
ComplianceGurl, CRCM Offline
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Joined: Jul 2007
Posts: 497
I have a business customer who offers cash advances to customers for a $30.00 fee. He also cashes checks and acts as an agent for Western Union. However, he has a contract with WU and he doesn't cash checks or do cash advances for over the threshold limit. Does charging the $30.00 fee though make him an MSB?
Help! THANKS!

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#858577 - 11/20/07 10:01 PM Re: Cash Advance-MSB? ComplianceGurl, CRCM
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
Charging a fee has no bearing on whether the business is a MSB or not. An MSB is defined by the type & dollar amount of activity conducted. Refer to 31 CFR 103.11(uu) for the definition.
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#858585 - 11/20/07 10:06 PM Re: Cash Advance-MSB? David Dickinson
ComplianceGurl, CRCM Offline
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Thanks for such a quick response!

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#858595 - 11/20/07 10:11 PM Re: Cash Advance-MSB? ComplianceGurl, CRCM
Auditor247 Offline
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Auditor247
Joined: Jun 2006
Posts: 140
Depending on the state requirements, they may be need to register or have a check casher license.

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#858719 - 11/21/07 01:16 PM Re: Cash Advance-MSB? Auditor247
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,231
Galveston, TX
Also, if they are doing this as a VISA/MC merchant, charging a cash advance fee is in violation of their merchant agreement.
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#858737 - 11/21/07 01:40 PM Re: Cash Advance-MSB? rlcarey
ComplianceGurl, CRCM Offline
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Joined: Jul 2007
Posts: 497
Basically he is accepting post dated checks and holds the check until that date. When that day arrives they bring him the cash and he returns the check to them. All for a $30.00 fee.

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#858762 - 11/21/07 02:05 PM Re: Cash Advance-MSB? ComplianceGurl, CRCM
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,231
Galveston, TX
That makes him a pay-day lender. You want to review this ruling:

http://www.fincen.gov/fincenruling2002-2.pdf
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#858875 - 11/21/07 03:31 PM Re: Cash Advance-MSB? rlcarey
ComplianceGurl, CRCM Offline
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Joined: Jul 2007
Posts: 497
Thanks RL, that's what I was looking for!

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#858963 - 11/21/07 04:24 PM Re: Cash Advance-MSB? ComplianceGurl, CRCM
WonderWoman Offline
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WonderWoman
Joined: Mar 2007
Posts: 2,108
gone fishin'
Some states (like CA) require you to register.

CALIFORNIA DEFERRED DEPOSIT TRANSACTION LAW
http://www.corp.ca.gov/fsd/fsdfaq.htm#cddtl
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