Multistate licensing agreement for money service businesses
AML AND COMPLIANCE NEWS |
On Feb. 6, 2018, the Conference of State Bank Supervisors (CSBS) announced a multistate agreement among seven states related to the money service business licensing process. The multistate agreement is being implemented by state regulators to streamline the money service business licensing application process. Under state and federal laws, money service businesses are required to operate with the appropriate license for each state, and register with FinCEN as a money service business. As a result, money service businesses are required to undergo the licensing application process of each state, as applicable to this business. The established multistate agreement will allow for one state to accept another state’s findings during the licensing application process. If one state has reviewed the company’s operations, business plan, background, and compliance with the Bank Secrecy Act and anti-money laundering requirements, then the other participating states can use that state’s findings during the licensing application process. This allows the licensing application process to become more efficient for money service businesses. As of Feb. 6, 2018, the following states have joined the agreement: Georgia, Illinois, Kansas, Massachusetts, Tennessee, Texas and Washington.
The purpose of the multistate licensing process is to create efficiency in the licensing process for money service businesses. Under this new agreement, the due diligence requirements for financial institutions have not changed.