November 18, 2004
Dear [ ]:
Your letter of October 5, 2004 to Steven Barras of this office has been referred to me for review and response. You ask for confirmation by the New York State Banking Department (the "Department") that [ ] does not require licensing as a money transmitter under Article XIII-B of the New York Banking Law (the "Banking Law").
Based on the information provided in your letter, I understand that [ ] is engaged in the transmission of funds from the United States. You indicate that its customers are typically "well-educated, banked individuals with internet access who wish to use the internet to send money to family and friends abroad or to pay for goods and services sold by international merchants." Your letter goes on to indicate that [ ] "allows customers to send money or make payments online to recipients in India, Philippines, Dominican Republic, Jamaica, Hong Kong, Nepal, Sri Lanka, Bangladesh, Argentina, Brazil, Bolivia, Chile, Paraguay, and Uruguay." [ ] has no physical presence in any State other than [ ] and has no agents in New York State. AIso, [ ] does not accept cash from its clients. Rather, its customers cause funds to be transmitted to [ ]through the services of [ ] over the Internet or by credit or debit card or ACH transfers. Customers initiate all of these transactions through [ ] secure website.
Prior to remittance overseas, banking institutions are used to hold customer monies resulting from debit, credit card or ACH transfers to [ ] and hold such funds in accounts entitled " [ ], As Agent for the Benefit of its Customers." These banks are all located outside of this State. Indeed, there is no indication in your letter that banking institutions located in New York State are in any way involved in effecting the transfer of funds for [ ].
Based on the facts as set forth in your letter, I would agree that, under the Department's current interpretations of the Banking Law, [ ]is not required to be licensed as a money transmitter in New York State. However, should the facts surrounding [ ] activities change in any, we would be required to revisit this question.
Should you have any questions in this regard, please forward them to my attention. I trust you will find this response helpful.
Very truly yours,
Gene C. Brooks
cc: Regina Stone