Regulatory Alerts2014-04-29
FinCEN Ruling on Whether a Company Offering Secured Transaction Services is a Money Transmitter
The Financial Crimes Enforcement Network issued an administrative ruling determining that a company providing internet-based secured transaction management services is not a money transmitter under the Bank Secrecy Act. FinCEN concluded that the company's acceptance and transmission of funds are integral to its core service of managing sales between buyers and sellers, rather than constituting a separate money transmission business. Consequently, the company is exempt from money transmitter registration requirements because the fund handling is necessary to facilitate the underlying transaction management and escrow services.
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