4/09/2023 MSB Locations Geo Coded with LAT/LON
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Money Service Business (MSB) Defined
A Money Service Business (MSB) is a financial institution that offers various money-related services such as currency exchange, money transfers, check cashing, and the sale of traveler's checks and money orders. or pre-paid access (formerly stored value) products; for an amount greater than $1,000 per person, per day, in one or more transactions. Reference IRS - Money Services Business (MSB) Information Center
These businesses play a vital role in the global economy, providing essential financial services to millions of people worldwide.
MSBs and Check Cashiers Location Data for BSA, CRA and UDAP Compliance
BSA Compliance - Check cashers, and money services businesses (MSBs), are required by FinCEN to to develop and maintain an effective Bank Secrecy Act (BSA)/Anti Money Laundering (AML) Compliance Programs to prevent their business from facilitating money laundering and terrorist activities. As noted by FINCEN, these Digital access points are prime targets for fraud. Under BSA Compliance regulations, banks and Credit Unions are responsible, for identifying then tracking transaction patterns for customers classified as check cashers or MSBs. This data is available from FINCEN - The Federal Financial Crimes Enforcement Network - US Treasury Department. We make this geocoded MSB file available here for free.
In California, regulatory review for MSB's is handled by the Money Transmitter Division of DFPI licenses and regulates money transmitters, which includes issuers of payment instruments (money orders), traveler’s checks and stored value cards. The California money transmission laws are found in the California Financial Code, Division 1.2, commencing with section 2000. Regulatory reviews can include, among other things: compliance matters such as KYC (know your client), suspicious activity monitoring/reporting and AML (anti-money laundering).
On this page we will outline the various services offered by MSBs, their importance in the financial ecosystem , and the concerns they present for banks and other community advocacy groups.
Services Offered by Money Service Businesses
- 1. Currency Exchange: MSBs facilitate the conversion of one currency into another, providing a crucial service for international travelers, businesses, and individuals who need to make transactions in foreign currencies.
- 2. Money Transfers: MSBs allow customers to transfer funds from one location to another, both domestically and internationally. This service is particularly useful for individuals who need to send money to family members or friends in other countries.
- 3. Check Cashing: MSBs offer check cashing services, allowing customers to convert checks into cash quickly and conveniently.
- 4. Sale of Traveler's Checks and Money Orders: MSBs sell traveler's checks and money orders, which provide a secure and widely accepted method of payment for individuals who may not have access to traditional banking services.
- 5. Payday Loans: Some MSBs also offer payday loans, catering to individuals who may not have access to traditional banking services or need immediate financial assistance.
Importance of Money Service Businesses
MSBs play a vital role in the global financial ecosystem, particularly for individuals who may not have access to traditional banking services. They provide essential financial services to millions of people worldwide, including:
- 1. Immigrants and migrant workers who need to send remittances to their families in their home countries
- 2. Unbanked and under banked individuals who lack access to traditional banking services
- 3. International travelers who require currency exchange and other financial services
CRA and UDAP Compliance
Financial institutions are required, under CRA, to meet the needs of the communities they serve within their assessment areas, especially in low and moderate income (LMI) defined census tracts. Many of the residents in these LMI rely on alternative financial service providers check cashing outlets, payday lenders, pawnshops, rent to own stores, and auto title lenders. While these alternative, nonbank financial service providers offer convenient services and easy access to cash, their services often carry high costs, limiting low income families ability to accumulate assets and establish a credit history.
Alternative financial service providers (like MSB's) are disproportionately located in minority, low-income neighborhoods.
Concerns for the Financial Service Industry
While MSBs provide essential financial services, they also present several risks and concerns for the financial service industry, including:
- 1. Money Laundering and Terrorist Financing: Due to the nature of their operations, MSBs can be used to launder money or finance terrorist activities. To mitigate this risk, banks must closely monitor and report suspicious transactions involving MSBs.
- 2. Regulatory Compliance: MSBs are subject to strict regulations and oversight from various government agencies. Banks that work with MSBs must ensure that these businesses are compliant with all relevant regulations, which can be a time-consuming and costly process.
- 3. Reputational Risk: Association with an MSB that is involved in illegal activities or is non-compliant with regulations can harm a bank's reputation, leading to potential loss of customers and business.
- 4. Operational Risk: MSBs may have weaker internal controls and risk management practices compared to traditional banks, which can expose partnering banks to operational risks, such as fraud.
Geo coded MSB locational data
GISBanker is making this list of geo coded check cashing and MSB businesses available for FREE to help institutions understand, locate and assess the impact these businesses have in your assessment areas.
We also have other data sets available you might be interested in.
Click here to download the 4/9/2023 geocoded MSB XLS file download here
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GISBanker can assist in developing these understandings and addressing the strategies and programs necessary to leverage your position in the market and to take full advantage of your shifting market dynamics and strategic goals.
The MSB location data is based on registration data available from FINCEN.gov.
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