Regulatory Alerts2015-08-14
Application of FinCEN’s Regulations to Persons Issuing Physical or Digital Negotiable Certificates of Ownership of Precious Metals
FinCEN issued an administrative ruling determining that a company issuing freely transferable digital certificates of ownership for precious metals qualifies as both a money transmitter and a dealer in precious metals. The agency concluded that the unrestricted transfer of value between customers via these digital certificates exceeds the exemption for brokers and dealers, thereby classifying the company as a convertible virtual currency administrator. Consequently, the company must implement anti-money laundering programs and comply with all applicable FinCEN recordkeeping, reporting, and registration requirements.
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