FIN 2008-R010: Is a Company that Engages in Operations as an Authorized Agent for Collection of Social Security and Veteran Benefits a Money Services Business?

In FIN 2008-R010, the FinCEN (Financial Crimes Enforcement Network) ruled whether a company that engages in certain operations as an authorized agent for collection of social security and veteran benefits is a money services business. According to the ruling, FinCEN:

• Provides through its regulations that each agent, agency, branch, or office within the United States of any person "doing business, whether or not on a regular basis or as an organized business concern" in the capacity of a seller or redeemer of money orders is a "money services business." A "seller or redeemer of money orders" includes any seller or redeemer of money orders "other than a person who does not sell [money orders] in an amount greater than $1,000 in currency or monetary or other instruments to or redeem [money orders] for an amount greater than $1,000 in currency or monetary or other instruments from, any person on any day in one or more transactions."
• Defines the term "check casher" as a person who is "engaged in the business of a check casher," other than a person who does not cash checks "in an amount greater than $1,000 in currency or monetary or other instruments for any person on any day in one or more transactions."
• Defines the term "money transmitter" to include "[a]ny person... who engages as a business in accepting currency, or funds denominated in currency, and transmits the currency or funds, or the value of the currency or funds, by any means through a financial agency or institution... or... [a]ny other person engaged as a business in the transfer of funds."

The company in this case was ruled not required to register as a money services business.

Posted by Min Young Choi, Associate Editor, Wealth Strategies Journal.