Examination information, frequently asked questions, and resources for Washington Money Transmitters and Currency Exchangers.
Money Transmitters Entry Letter - Prior To Examination
The entry letter above is sent to the licensee prior to a routine examination.
Common Examination Findings
Maintenance of Permissible Investments
Licensees must maintain a market value of permissible investments that is not less than all outstanding money transmission liability, as required by RCW 19.230.200.
Inaccurate/Incomplete CTR, CMIR, or FBAR filings
Licensees should ensure that all federal reports are completed accurately and completely in order to comply with 31 CFR 103.27(d) as well as RCW 19.230.180.
RCW 19.230.330(3), states in part, that “Every money transmitter licensee and its authorized delegates shall refund to the customer all moneys received for transmittal within ten days of receipt of a written request for a refund.” Licensees should ensure language on Washington receipts does not contradict the refund guidelines set by the Act. See: RCW 19.230.330(3).
Accepting Post Office Boxes and Authorized Delegate Addresses
By accepting PO boxes or AD addresses as consumer addresses, Licensees are at risk of supplying inaccurate information in response to law enforcement requests or filing required reports erroneously. Although the act of accepting these addresses is not a violation, it is in general an industry best practice to not accept PO boxes or AD addresses as consumer addresses.
Maintenance of financial records
Licensees are required to keep, at a minimum, the following financial records: general ledger (posted at least monthly), bank reconciliations, and annual audited financial statements.
Insufficient monitoring for suspicious activity
Licensees must review transactions for potential suspicious or illegal activity and report it to FinCEN on a SAR-MSB (FinCEN Form 109).
Frequently Asked Questions
Where can I find a copy of the Department of Treasury’s Specially Designated Nationals (SDN) list?
A copy of the most recent list can be found on the Office of Foreign Assets Control (OFAC) website. From this site you can also sign-up to receive e-mail updates when any information changes on the SDN list.
What are the regulatory requirements regarding conducting an independent review of our Anti-Money Laundering (AML) Program?
The Financial Crimes Enforcement Network (FinCEN) under the Department of the Treasury has issued guidance to help money services businesses understand the requirements of an independent review. View the Guidance.
As a money transmitter, I am required to have audited annual financial statements. Where can I verify if my accountant is certified and/or find a certified accountant to provide this service?
The American Institute of Certified Public Accountants provides a link to every individual State Board of Accountancy where you can go to search for a specific individual or firm in order to verify certification. Visit the AICPA website.
What is a “risk assessment”? And am I required to have one?
A BSA/AML risk assessment evaluates all risk areas of the company, including areas such as products, services, customers, entities, volume, and geographic locations. The provisions of the Bank Secrecy Act do not require a risk assessment in writing. However, the risks associated with a company must be evaluated to ensure an adequate anti-money laundering program is in place to prevent money laundering and/or terrorist financing.
What financial records am I required to keep?
Money transmitter licensees are required to keep a general ledger (posted at least monthly), bank reconciliations (preferably conducted monthly), and annual audited financial statements. In order to prove compliance, licensees should also maintain a database of all transactions conducted, and records proving.
What should I expect on an examination?
DFI conducts examinations of its money transmitter licensees approximately every 6-24 months, depending on the risk posed by the business. On an examination, licensees undergo an in-depth financial analysis, where asset quality, capital adequacy, earnings performance, net worth, liquidity, and permissible investments are evaluated. In addition, the examiner will review the licensee’s transactions to ensure compliance with federal recordkeeping and reporting requirements. Management will be assessed to ensure they are not running the company in a manner that could prove to be unsafe for Washington consumers. The examiner will also review compliance with various other parts of the Uniform Money Services Act, as well as other applicable state and federal laws. The onsite examination can take anywhere from three days to several weeks, depending on the complexity of the licensee’s operations, willingness to provide requested documentation, and overall level of compliance.
Financial Examiner Supervisor