AML Requirements for Non-Bank Financial Institutions

1
AML Requirements for Non-BankFinancial
Institutions
2
What are Non Bank Financial Institutes (NBFIs)?

• NBFIs are broadly defined as institutions other
  than banks that offer financial services.
• Common examples include

Brokers or Dealers in Securities Insurance Companies Finance/Loan Companies Vehicle Dealers Pawnbrokers Casinos Travel Agents Dealers in Precious Metals, Stones, or Jewels Real Estate Closing and Settlement Services Financial Service Intermediaries such as Investment Advisors Money Service Businesses (remittance providers, cash exchange)







3
MONEY SERVICES BUSINESS(MSB)

• A Subset of the NBFI Universe
• Includes
• Money Transmitters
• Currency Dealers or Exchangers
• Check Cashers
• Issuers, Sellers, or Redeemers of
• Travelers Checks
• Money Orders
• Stored Value
• US Postal Service (Money Orders)

4
NBFI Risk Factors

• There is a higher risk for potential money
  laundering activities with NBFIs because many
  NBFIs
• Maintain limited or inconsistent recordkeeping on
  customers and transactions.
• Engage in frequent currency transactions.
• Are prone to less regulation and often unaware of
  regulations.
• Can quickly enter or exit into business.
• Sometimes operate without proper registration or
  licensing.
• Require minimal or no identification from
  customers.

5
AML Requirements

• NBFIs must have a written BSA/AML policy and
  procedures to establish
• Internal controls
• BSA Officer
• Ongoing BSA training
• Independent testing

6
MSB Regulatory Requirements

• Must register with FinCEN (other than agents)
• Must be licensed in accordance with state and/or
  local laws
• Must file CTRs with no exemptions based on
  customer profiles
• Must file SARs
• Are subject to OFAC requirements

7

• Want to learn more about anti-money laundering,
  the process, how it works and best practices?
  ComplianceOnline webinars and seminars are a
  great training resource. Check out the following
  links
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