MSB rules, answered from the source
Plain-English guides to the federal money services business rules, each checked against the regulations, rulings and Federal Register text it cites. Every guide links its sources so you can read the rule itself.
- Agent of the payee: federal MSB registration or state licensing?
Agent of the payee is a licensing exemption in the model state money transmission act and in some states' laws, not in FinCEN's rules; check each state's own text. Federally, the payment processor test is the closest fit. How the two tests differ.
- Do agents of an MSB have to register with FinCEN?
A business that is an MSB solely because it acts as another MSB's agent does not register with FinCEN; one that also offers MSB services on its own behalf must. Agents that are MSBs still have AML duties, and the principal must keep a detailed agent list and monitor its agents.
- Do crypto and stablecoin businesses need to register as MSBs? What the GENIUS Act changes
Under FinCEN's guidance, exchangers and administrators of convertible virtual currency generally qualify as money transmitters unless a limitation or exemption applies, and users generally do not. Where hosted wallets and stablecoin issuers fit, and what the GENIUS Act changes.
- Do payment facilitators (PayFacs) need to register as MSBs?
FinCEN's rules do not mention PayFacs. Whether one registers turns on its funds flow and the payment processor exemption. State licensing is separate.
- Does a fintech based outside the US need to register as an MSB to serve US customers?
FinCEN's MSB rules reach firms wherever located that do business in substantial part in the US. The test, the exclusions and what registering involves.
- How to register (and renew) as an MSB with FinCEN
MSBs that must register file Form 107 with FinCEN within 180 days of being established, then renew every two years by December 31. Who is excepted, what to file, and when.
- The payment processor exemption: what it is and when it applies
FinCEN's payment processor exemption: the rule text, the four conditions FinCEN applies, and what breaks them. State licensing is a separate question under each state's law.
- What must an MSB AML program contain?
Every MSB needs a written, risk-based AML program with four minimum parts. What each part must cover under 31 CFR 1022.210, and what may change.
- When does an MSB have to re-register with FinCEN?
An MSB must re-register with FinCEN within 180 days of a change in ownership or control that requires re-registration under state law, a transfer of over 10% of equity or votes (unless it must be reported to the SEC), or over 50% more agents in a registration period.
- When must an MSB file a SAR, and what are the deadlines?
MSBs covered by the SAR rule must report transactions of at least $2,000 that they know, suspect or have reason to suspect meet the rule's criteria, within 30 calendar days of initial detection. Issuers of money orders or traveler's checks reviewing clearance records report at $5,000 or more.
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