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MTRA INTERMEDIATE EXAMINERS SCHOOL 
3 February 2008 - MTRA is holding an Intermediate Examiners School in Miami, Florida from April 21 - April 25, 2008. This five day, hands-on course will offer the tools to become proficient as an examiner, use MTRA joint examinations procedures to evaluate money transmitters and provide networking opportunities with fellow state examiners. Students are required to bring a lap top since the school will include data mining and computer aided instruction and exercises. The school is limited to the first 30 state regulators who register and will be held at the Hyatt Place Miami Airport West.
The school curriculum has been designed by the MTRA Education Committee. The school will be taught by veteran State regulators: John Bishop, Senior Administrator, Ohio Division of Financial Institutions; Rollin Badal, Financial Examiner, Maryland Office of the Commissioner of Financial Regulation; Bert Gonzalez, Financial Examiner, Texas Department of Banking; and Tom McVey, Jr., Chief Examiner, West Virginia Division of Banking.
Thank you for your overwhelming support. For further information, please contact MTRA Administrator Susan Shermer at info@mtraweb.org or call (717) 545-9991.
SIGUE OF CALIFORNIA SETTLES FOR AML DEFICIENCIES
28 January 2008 - The Financial Crimes Enforcement Network (FinCEN) announced the assessment of a civil money penalty in the amount of $12 million against Sigue Corporation and Sigue, LLC, a money services business headquartered in San Fernando, California, for violations of the Bank Secrecy Act (BSA). Sigue, without admitting or denying the allegations, consented to the civil money penalty. Concurrently, the Department of Justice announced today that Sigue has also entered into a deferred prosecution agreement on charges of failing to maintain an effective anti-money laundering program and will forfeit $15 million to the U.S. government. FinCEN's penalty will be deemed satisfied by a portion of the $15 million payment to the Department of Justice.
Sigue has more than 7,000 agent businesses or "authorized delegates" located throughout the United States, providing money transmission services from the United States to Mexico and Latin America. The authorized delegates, which are typically small businesses and Sigue each, earn a small fee for the transactions conducted through these agents.
FinCEN determined that Sigue failed to establish and implement an anti-money laundering program reasonably designed to ensure compliance with the Bank Secrecy Act which led, in turn, to a failure by management at Sigue to implement measures to respond to continued patterns of suspicious activity, with repeated common characteristics, at certain agent locations. Specifically, on multiple occasions over an extended period of time, 47 agents assisted customers in the structuring of transactions represented to be drug trafficking proceeds to avoid the currency transaction reporting requirements of the Bank Secrecy Act. Sigue's failure to implement effective internal controls, training or independent testing to manage the risk of money laundering was serious, longstanding and systemic.
"Today's enforcement action reinforces our message on the importance of compliance by all the diverse sizes and types of financial institutions subject to the Bank Secrecy Act," said James H. Freis, Jr., Director of the Financial Crimes Enforcement Network. "Principals of money services businesses must exercise effective oversight and control over the authorization, transactional activity and operations of their agents to ensure compliance with the BSA and prevent money
FINCEN DIRECTOR FREIS ADDRESSES MTRA ANNUAL CONFERENCE
October 2007 - The 2007 Annual Conference of the Money Transmitter Regulators Association (MTRA) kicked off on October 9th in Charlotte, North Carolina. Over 200 regulators and industry officials attended the three day event, representing member states and money transmitters across the country. James H. Freis, Jr., Director of the Financial Crimes Enforcement Network (FinCEN) was the keynote speaker.
In his address, Director Freis announced the availability of a new resource to help reduce common errors found on Suspicious Activity Reports (SARs). The activities and transactions reported through SARs provide law enforcement and regulatory authorities with useful information to detect and disrupt potentially illegal activities such as money laundering and terrorist financing. The document was compiled after FinCEN completed an analysis of SARs (http://www.fincen.gov/SAR_Common_Errors_Web_Posting.pdf).
The conferees also heard presentations from academics who shared their research on money transmission. Dr. Dean Yang from the University of Michigan described his theory linking the volume of transmissions with the degree of control held by the remitter over the ultimate use of the funds. The results of his study of money transmission by Salvadoran migrant workers in Washington, D.C., Virginia and Maryland will be completed in 2008. Dr. Manuel Orozco reviewed and analyzed the main dynamics of the $100 billion in annual remittances from U.S. migrants which represent 30% of global flows.
In a separate meeting of regulators, the preliminary results of a MTRA survey of state regulation of money transmission in the U.S. were presented by Nick C. Kyrus and Karen S. Heede. The survey showed that with the exception of Alaska, Montana and South Carolina, 47 states and the District of Columbia require money transmitters to obtain licenses prior to offering services to their residents. Before issuing licenses, most state laws require regulators to make findings about the character and financial responsibility of the applicant and its senior members. Supervision of operations of money transmitters consists of on-site and off-site examinations, review of periodic reports filed by licensees, and resolving consumer complaints.
The regulators elected the following MTRA directors and officers for a two year term: Joseph E. Rooney (MD) President and Director, Randall S. James (TX) Vice President and Director, Robert Venchiarutti (CA) Secretary and Director, Tracy M Hudson (WV) Treasurer and Director, Sonya L. Allen (KS) Director, John Bishop (OH) Director, Reitzel Deaton (NC) Director, Greg Gonzales (TN) Director, Nicholas C. Kyrus (VA) Director, and Regina A. Stone (NY) Director.
President Rooney announced that the 2008 MTRA Annual Conference will be held at the Snow King Resort, Jackson Hole, Wyoming on September 3-5.
MTRA HELD FIRST WEEK-LONG SUCCESSFUL EXAMINERS SCHOOL
2 July 2007 - Twenty-five state examiners attended the first week-long MTRA School for Money Transmitter Examiners held in San Francisco, California on June 18-22, 2007. Attendance was limited to the first 25 registrants and due to high demand, another session of the school will be held in Annapolis, Maryland, August 20-24 at the Historic Inns of Annapolis.
MTRA president Joseph Rooney praised the organizers and school instructors for their hard work and dedication. He stated that the use of veteran examiners as instructors, the careful selection of relevant topics for discussion, and the prevailing informal atmosphere made the school more meaningful and a great success.
Six veteran state examiners made presentations on topics such as planning the exam, analysis of financial statements of money transmitters, data mining, the MTRA core exam, the MTRA rating system, and anti money laundering and OFAC compliance. The instructors were Jeanette Barraza, CAMS, Financial Institutions Supervisor, California; John Bishop, Senior Administrator, OH; Bert Gonzalez, Financial Examiner, TX; Julio Prada, CAMS, Assistant Deputy Commissioner, CA; Julie Vanderslice, CAMS, Financial Examiner Supervisor, WA; Robert Venchiarutti, Deputy Commissioner, California; and Robert Mbama, CAMS, Consultant. The curriculum of the school was developed by the speakers.
MTRA STRATEGIC PLANNING
8 May 2007 - The MTRA Board of Directors had a strategic planning retreat in Austin Texas last month for the purpose of defining MTRA's mission, objectives/ goals, and devise strategies to meet them over the next five years. The meeting was facilitated by J. Keith Hughey of Wilson, Hughey & Yarbrough, LLC, a management consulting firm, and hosted by Texas Banking Commissioner Randall James. The mission of MTRA, as formulated by the Board, is "to advance the efficient and effective regulation of the money transmission industry". It was agreed that the core values needed to meet MTRA's mission are cooperation, integrity, service, and excellence. The Board's vision for the next five years is the establishment of a cooperative state regulatory framework for the benefit of the member states, the industry and the public. Such a regulatory framework will be established by (a) advancing uniform examination standards, reports, forms and ratings that are crucial in providing value to both the membership and the industry; (b) promote a more efficient and less burdensome state regulatory system that has universal respect and credibility; (c) provide quality educational opportunities and certification to participants through a well defined curriculum: (d) collect and disseminate reliable industry specific data , common analytical standards, and best practices: (e) serves as the authority for money transmission issues on a national scale; and (f) partner with state and federal authorities to further efforts in the direction and elimination of illegal activities, including terrorist financing.
JAMES H. FREIS, JR. NAMED DIRECTOR OF FINCEN
5 March 2007 - U.S. Treasury Secretary Henry M. Paulson, Jr. named James H. Freis, Jr. as the new Director of the Financial Crimes Enforcement Network (FinCEN). Freis currently serves as Deputy Assistant General Counsel for Enforcement & Intelligence.
As Deputy Assistant General Counsel, Freis provides legal support to Treasury's Office of Terrorism and Financial Intelligence, including supervising the legal counsel to FinCEN, the Office of Foreign Assets Control, and the Treasury Executive Office for Asset Forfeiture. He is also responsible for developing international financial measures against rogue states.
Before coming to Treasury, Freis served as Senior Counsel in the Legal Service of the Bank for International Settlements in Basel, Switzerland, where he supported the banking and risk control departments in providing financial services to central banks and international organizations for management of monetary reserves. He also had regular interaction with the Basel-based committees of experts setting international financial standards. He previously served in the Federal Reserve Bank of New York's legal department, where he advised on payment and settlement systems issues at wholesale and retail levels, administration of foreign government and central bank accounts, and legislative and regulatory reform. He was part of the successful defense of the Bank before the Iran-U.S. Claims Tribunal in The Hague with respect to the management of Iranian funds during the hostage crisis. Freis also spent one year working in the financial sector in Germany.
Freis earned his Juris Doctorate from Harvard Law School and his bachelors degree from Georgetown University, graduating with honors from each institution. He is an attorney-at-law and a Chartered Financial Analyst (CFA) charterholder. Freis currently resides in Washington, DC with his wife and two children.
Freis replaces Robert Werner, who resigned in December 2006.
MTRA's Response to MSB Account Closings by Banks
John Reich, Chairman, Office of Thrift Supervision
Robert Werner,
Director,
FinCEN
Sheila Bair,
Chairman,
Federal Deposit Insurance Corp.
Scott Alvarez,
General Counsel,
Federal Reserve Board
John Dugan,
Comptroller of the Currency
IRS AND STATES JOIN FORCES TO COMBAT MONEY LAUNDERING
27 April 2006 - The Internal Revenue Service announced today agreements with 33 states and Puerto Rico to begin sharing Bank Secrecy Act (BSA) information. The agreements will allow the IRS and the participating states to share information and leverage their resources to ensure that money services businesses (MSBs) are complying with their federal and state responsibilities to register with the government and report cash transactions and suspicious activities.
"We already work cooperatively with over 40 states to combat abusive tax shelters," said IRS Commissioner Mark W. Everson. "This new agreement will help the federal and state governments leverage resources while attacking illegal money laundering."
The IRS and participating states will share enforcement leads and coordinate their efforts to make sure they are doing all the Bank Secrecy Act examinations on MSBs as required by law without overlapping efforts. The agreements will also help the IRS and the states present a united compliance front to MSBs and their representatives.
Along with Puerto Rico, the following states have signed partnership agreements with the IRS: Alabama, Alaska, Arizona, Arkansas, California, Connecticut, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Nebraska, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Utah, Vermont, Washington, West Virginia, Wisconsin and Wyoming.
Colorado, Hawaii, Montana, New Hampshire, New Mexico and Montana cannot enter into these agreements with the IRS because either state law prohibits them from doing so or they do not regulate the industry.
The information the IRS and the states may share under these agreements is limited to Bank Secrecy Act examination information, not tax information. The IRS has separate, long-standing agreements with the states for the exchange of tax information.
FinCEN NOTICE OF RULE MAKING TO HELP MSB ACCESS TO BANKING SERVICES
March 8, 2006 - The Financial Crimes Enforcement Network (FinCEN) issued an Advance Notice of Proposed Rulemaking seeking comments from both the money services business industry and the banking industry on the issue of money services businesses obtaining appropriate access to banking services. Today's action is part of FinCEN's ongoing efforts to address continued concerns about the ability of money services businesses to open and maintain accounts and obtain other services at banks and depository institutions as well as the caution of the banking industry in dealing with money services businesses.
"Money services businesses play an important role in America's economy by providing valuable financial services to many Americans who do not, or cannot yet, take advantage of typical savings or checking accounts," said Robert W. Werner, FinCEN's Director. "It is critical for the health and safety of the U.S. financial system that MSBs obtain and maintain banking services and not be driven underground."
Money services businesses have run across obstacles to creating or maintaining deposit accounts in banks. FinCEN, in conjunction with subcommittees of the Bank Secrecy Act Advisory Group, aimed to address these concerns and misperceptions by hosting a fact-finding meeting a year ago during which representatives from the money services business and banking industries, along with government regulators, came together to voice their concerns. Based on the facts and recommendations presented during this meeting, FinCEN and the federal banking agencies sought to clarify Bank Secrecy Act compliance expectations for the banking industry in interpretive guidance issued in April 2005. FinCEN also concurrently issued an advisory to MSBs emphasizing their Bank Secrecy Act regulatory obligations.
Despite these steps, FinCEN remains concerned that money services businesses may still face barriers to obtaining appropriate access to banking services. This Advance Notice of Proposed Rulemaking solicits updated facts concerning this situation as well as recommendations regarding the extent to which additional guidance or regulatory action under the Bank Secrecy Act might address these concerns.
Written comments may be submitted for 60 days after publication in the Federal Register.
LIST OF REGISTERED MONEY SERVICES BUSINESS WITH FINCEN
The Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) makes available a new list of registered money services businesses. The list provides information per state/territory and reflects information provided by filers. Each is arranged alphabetically - first, by the selected state, then, by each city within the selected state, and finally, by MSB Registrant name within each city. FinCEN said the list should only be used as a general reference for the public and may contain inaccuracies. The list can be downloaded at: www.msb.gov/guidance/msbstateselector.php.
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