Mitigating the hazards that MSBs bring to your bank
We ensure that servicing MSBs doesn't put your bank at excessive risk and that you're not inadvertently facilitating financial crimes.
Federal regulators are dead serious about the compliance hazards associated with money service businesses (MSBs).
So are we.
Though including MSBs in your customer base can provide a steady source of fee income, such relationships also mean accepting greater risk and jumping through more regulatory hoops to make certain you're complying with BSA/AML requirements and protecting your bank from financial crimes.
When you service MSBs, you need an experienced, meticulous BSA/AML expert to ensure that such clients aren't endangering your bank.
We're that expert.
Providing guidance about MSBs, helping you adapt to new rules, and ensuring that you're not unwittingly enabling financial crimes through your MSB work are routine parts of our practice.
Our first order of business is thoroughly assessing your appetite for risk to determine whether you even want MSBs in your client mix.
We also conduct a comprehensive BSA/AML/OFAC risk assessment to be sure that your program can accommodate the greater exposure that an MSB brings to your doorstep and identify policy and procedural changes you may need to make.
Our exhaustive vetting process includes:
- Developing custom questions to identify an MSB's activities, services, and the geographic areas it serves.
- Understanding transaction volume, dollar amounts of transactions, and whether an MSB moves money domestically or internationally.
- Reviewing an MSB's history of compliance, its approach to adhering to BSA/AML requirements, and the employee training it has in place.
Based on our findings, we recommend the number and types of MSBs that are safe to do business with, the ones that fit your risk tolerance, and strategies for monitoring clients' risky behavior.
In addition, we consider the time and personnel you must commit to the oversight of each MSB and ways to adapt your systems and procedures to guard against crimes like money laundering and terrorist financing.
Working with MSBs is never a one-and-done, and we're by your side every step of the way.
TCA offers A Better Way for you to vet and manage your MSB clients, control your risk, and understand how to respond to changing regulations.
Key deliverables include:
- Performing enhanced due diligence, confirming that you're not doing business with MSBs involved with financial crimes.
- Establishing comprehensive onboarding procedures that give you a deep look at how a prospective MSB operates and whether it drastically ups your risk.
- Ensuring that you've taken appropriate steps to identify and prevent illicit activity.
- Developing a monitoring strategy to identify and respond to an MSB's questionable behavior.
- Keeping you updated on evolving threats associated with financial crimes and changing regulations.
Money Servicess Businesses
Legislative and Regulatory BSA/AML Changes
Despite the collective efforts of law enforcement and BSA risk managers across the country, the United States is not doing the best job of finding effective and efficient ways to combat money laundering. Regulatory and legislative efforts, which are the truly meaningful actions that could be taken, are currently being worked on in Washington. A […]
Examiners Stress Independent Audit Critical to BSA Success
On July 22, 2019, the prudential regulators issued FIL-43-2019 making a joint statement on BSA/AML risk-based approaches in examinations. TCA’s BAT reviewed the statement and took away three key points: transparency, risk assessment and independent audit. Transparency – The statement states: “This statement is intended to improve transparency into the risk-focused approach used for planning […]
Quality Assurance Monitoring for BSA/AML Compliance Programs
When your institution is examined for compliance with any law or regulation, the measure of your efforts will be based on your ability to self-identify and self-correct any deficiencies. Ongoing monitoring of key processes helps to ensure that any errors or warning flags are identified early. Monitoring is a required element of a compliance management […]
Model Validations—Why Do I Need a GAP Analysis?
The regulators are upping their game and are becoming more familiar with Automated Monitoring Systems. They are starting to push the boundaries of a model validation and their expectations for a “complete” model testing review. Some examiners are more advanced than others, but the word is being spread and soon they’ll all catch on! This […]
Making SAR Narratives Error‐Proof
Each SAR field is entered into FinCEN’s searchable database, so law enforcement can pull information or run inquires to aid investigations into financial and other illicit crimes. That’s why SARs are crucial. The law enforcement agencies are your audience and they need to know the whole “story” since they were not actively involved in the […]
FinCEN Finalizes New SAR
FinCEN announced updates to the Suspicious Activity Report (SAR) filing format in a notice to e‐filers. The announcement says that the revisions adhere to the changes listed in FinCEN’s February 2, 2017 Federal Register notice and will be live in June 2018. In these new filings, batch submissions will have to be made in an […]
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