FinCEN Issues Ruling (FIN-2008-R012)on Whether a Money Services Business Must Establish and Maintain Separate Deposit Accounts for its Separate Check Cashing and Money Transmission Lines of Business

Ruling

FIN-2008-R012

Issued: December 11, 2008

Subject: Whether a Money Services Business Must Establish and Maintain

Separate Deposit Accounts for its Separate Check Cashing and Money

Transmission Lines of Business

Dear [ ]:

I am writing in response to your letter of May 7, 2008 to the Financial Crimes

Enforcement Network (“FinCEN”) requesting an administrative ruling as to whether a

money services business (“MSB”) must establish and maintain separate deposit accounts

for its separate check cashing and money transmission lines of business in order to

comply with the Bank Secrecy Act (“BSA”) and its implementing regulations.1 As

explained below, the BSA regulations do not contain any requirement that MSBs

maintain separate deposit accounts for separate check cashing and money transmission

lines of business.

You represent that your client, [ ] (“Client”), is an MSB operating as a money

transmitter in Florida, Georgia, and South Carolina, and as a check casher in Florida.2

Client’s bank, [ ] (“the Bank”), has questioned whether Client may maintain a single

deposit account to hold funds from both its money transmitter and check cashing lines of

business and has requested that Client obtain written permission from a regulatory

authority to maintain a single account for both business lines. Your letter references the

Bank’s concern that Client might “commingle” funds derived from both the money

transmitter and check cashing business lines.

The BSA regulations do not require an MSB to maintain separate bank accounts

for different lines of business, and there is therefore no BSA regulatory requirement

prohibiting Client from mixing funds derived from various legitimate business activities

in a single deposit account. FinCEN notes, however, that the BSA does not prohibit a

financial institution such as the Bank from choosing to adopt policies that address issues

not addressed in BSA regulations, at the financial institution’s discretion

, and there is therefore no BSA regulatory requirement

prohibiting Client from mixing funds derived from various legitimate business activities

in a single deposit account. FinCEN notes, however, that the BSA does not prohibit a

financial institution such as the Bank from choosing to adopt policies that address issues

not addressed in BSA regulations, at the financial institution’s discretion. In addition,

while FinCEN has been delegated the authority to administer the BSA,3 it does not have

1 See 31 U.S.C. § 5311 et seq., 12 U.S.C. § 1829(b), and 18 U.S.C. §§ 1951-59 (Bank Secrecy Act). See

also 31 C.F.R. Part 103 (regulations implementing the Bank Secrecy Act). [ ]

2 See 31 C.F.R. § 103.11(uu)(2), (5) (defining “money services business” to include check cashers and

money transmitters).

3 The Secretary of the Treasury has delegated his authority to administer the BSA and its implementing

regulations to FinCEN. Treas. Dep’t Order No. 180-01 (Sept. 26, 2002).

the authority to administer or enforce any other federal statute. As a result, this guidance

is not intended to be a statement on the existence or applicability of any other laws or

regulations.

This ruling is provided in accordance with the procedures set forth at 31 C.F.R.

§ 103.81. In arriving at our conclusions, we have relied upon the accuracy and

completeness of the representations made in your letter. Nothing precludes FinCEN from

arriving at a different conclusion or from taking other action should circumstances

change, or if any of the information you have provided proves inaccurate or incomplete.

We reserve the right, after redacting your name and address, to publish this letter as

guidance in accordance with our regulations. Please inform us within fourteen (14) days

from the date of this letter of any other information that you believe should be redacted

from this letter and the legal basis for redaction

r if any of the information you have provided proves inaccurate or incomplete.

We reserve the right, after redacting your name and address, to publish this letter as

guidance in accordance with our regulations. Please inform us within fourteen (14) days

from the date of this letter of any other information that you believe should be redacted

from this letter and the legal basis for redaction.

If you have any questions regarding this administrative ruling, please contact

[FinCEN’s regulatory helpline at (800) 949-2732].

Sincerely,

// signed //

Jamal El-Hindi

Associate Director

Regulatory Policy and Programs Division