Regulatory Alerts2009-01-22
Added
FinCEN Ruling FIN-2009-R001 on Whether Service Provider to Prepaid Stored Value Program Participants is a Money Services Business
The ruling determines that a company acting as a service provider for a prepaid stored value program is not a money services business. The company's activities, including capturing card purchase and reload amounts and transferring funds to the issuing bank, are considered integral parts of the execution and settlement of the stored value sales transaction rather than money transmission. Additionally, the company is not classified as a seller or redeemer of stored value because it acts solely as an intermediary providing back-office services between the program arranger and its sales agents.