Thread Starter: Anonymous
Title: Re: used car dealer is an NBFI???
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OP here. Okay but I still think the response ignores the question, which was:
Would you say that is a "loan company" as contemplated in the NBFI rules and monitoring requirements? Why or why not?
This is the FFIEC's NBFI info to which I refer:
RISKS ASSOCIATED WITH MONEY LAUNDERING AND TERRORIST FINANCING
Nonbank Financial Institutions—Overview
Objective. Assess the adequacy of the bank's systems to manage the risks associated with accounts of nonbank financial institutions (NBFI), and management's ability to implement effective monitoring and reporting systems.
NBFIs are broadly defined as institutions other than banks that offer financial services. The USA PATRIOT Act has defined a variety of entities as financial institutions. 277 Common examples of NBFIs include, but are not limited to:
Casinos and card clubs.
Securities and commodities firms (e.g., brokers/dealers, investment advisers, mutual funds, hedge funds, or commodity traders).
Money services businesses (MSB). 278
Insurance companies.
Loan or finance companies. 279
Operators of credit card systems.
Other financial institutions (e.g., dealers in precious metals, stones, or jewels; pawnbrokers).
https://bsaaml.ffiec.gov/manual/RisksAssociatedWithMoneyLaunderingAndTerroristFinancing/25
So I'm not asking if the USC might define auto seller as a "financial institution" but rather whether a car lot that finances its own cars might be a "loan or finance company" from the NBFI list above. My assumption is that if the FFIEC wanted banks focusing on car sellers, then it would be one of the examples listed above. I do see that it says "other" but it also gives several examples of "other."
For those who are just going to revert straight back to the USC definition, please advise: In your shop, do you have every used car lot customer on your list of NBFIs?
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