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New Part 417 of the Superintendent's Regulations
(Maintenance of Anti-Money Laundering Compliance Programs by Licensed Check Cashers and Licensed Money Transmitters)

April 9, 2008

Part 417

MAINTENANCE OF ANTI-MONEY LAUNDERING COMPLIANCE PROGRAMS BY LICENSED CHECK CASHERS AND LICENSED MONEY TRANSMITTERS
(Statutory authority: Banking Law Sections 10, 37(3), 39, 44, 371, 646 and 649.)

Sec.
417.1 Covered Entities
417.2 Anti-Money Laundering Programs
417.3 Additional Reports

Sec. 417.1 Covered Entities

This Part shall apply to all Licensed Check Cashers and Licensed Transmitters of Money (each a “Licensee”).

Sec. 417.2 Anti-Money Laundering Programs

Each Licensee, in order to guard against money laundering through their businesses, shall establish and maintain an anti-money laundering program that complies with applicable federal anti-money laundering law (31 U.S.C. Chapter 53, subchapter II)*, including the obligation to file Suspicious Activity Reports (“SARS”) (31 U.S.C. §5318(g))*, and regulations promulgated by the Department of Treasury (31 CFR part 103.125)* (hereinafter referred to as “31 CFR Part 103”), and, when ordered, such entities shall provide within 30 days a written report to the Superintendent of Banks (the “Superintendent”) detailing the extent to which each such institution has established such a program. In addition, the Superintendent seeks to assure compliance with applicable regulations of the Office of Foreign Assets Control promulgated by the United States Department of the Treasury (31 CFR part 500 et seq.)*.          

  1. For purposes of this Part, the required anti-money laundering program shall, at a minimum:
    1. Incorporate policies, procedures, and internal controls reasonably designed to assure compliance with this 31 CFR Part 103, including;
      1. Policies, procedures, internal controls developed and implemented under this section shall include provisions for complying with the requirements of 31 CFR Part 103 including, to the extent applicable to the money services business, requirements for:
        1. Verifying customer identification;
        2. Filing reports;
        3. Creating and retaining records; and
        4. Responding to law enforcement requests.
      2. Every Licensee that has an automated data processing system should integrate its compliance procedures with such systems.
    2. Designate a person to assure day to day compliance with the program and 31 CFR Part 103. The responsibilities of such person shall include assuring that:
      1. The Licensee properly files reports, and creates and retains records, in accordance with applicable requirements of 31 CFR Part 103;
      2. The compliance program is updated as necessary to reflect current requirements of 31 CFR Part 103, and related guidance issued by the Department of the Treasury; and
      3. The Licensee provides appropriate training and education in accordance with 31 CFR Part 103.
    3. Provide education and/or training of appropriate personnel concerning  their responsibilities under the program, including training in the detection of suspicious transactions to the extent that the entity is required to report such transactions under applicable federal law and regulations; and
    4. Provide for independent review to monitor and maintain an adequate program.
  2. The anti-money laundering program shall be in writing and each Licensee shall make copies of the anti-money laundering program available for inspection as appropriate by the Superintendent.
  3. Each Licensee will further be required to demonstrate that it has in place risk-based policies, procedures and practices to ensure, to the maximum extent practicable, that it’s transactions comply with OFAC requirements.
  4. Every Licensee shall file SARS in accordance with applicable federal law and regulations.
  5. Compliance with applicable federal requirements shall constitute compliance with the provisions of this Part.
Sec. 417.3 Additional Reports

Each Licensee shall provide such additional reports regarding its compliance with this Part as shall be directed by the Superintendent.

* For information regarding the United States Code (USC or U.S.C.), the Code of Federal Regulations (CFR) and the Federal Register, see Supervisory Policy G 1.

Explanatory All Institutions Letter

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