The Financial Crimes Enforcement Network (“FinCEN”) issued a statement on November 10 clarifying that banks should not terminate the accounts of money transmitters indiscriminately in an effort to comply with the Bank Secrecy Act (“BSA”). According to the statement, which was issued in response to concerns that banks are denying services to money transmitters as a class, banks should assess the risk of serving a money services business based on customer due diligence reviews conducted to establish the risk that each potential customer poses.
Nutter Notes: According to the statement, banks should conduct due diligence commensurate with the risk each potential money services business poses and should understand the customer’s business model and general nature of the customer’s own customer base. FinCEN also stated that banks do not need to know the business’s individual customers to comply with the BSA. The OCC also issued a Statement on Risk Management Associated with Money Services Businesses on November 19, which provides similar guidance to national banks and federal savings associations on supervisory expectations for serving money services businesses.