Interesting situation (RE: Bank Secrecy Act)

[nrobi]

What is the name of your state? Massachusetts

I'm in an interesting situation. I'm just about to launch a business online as a currency exchanger (hard to get currencies). I've been reading over the BSA and am left with several questions. I've been very diligent in my research but I want to make sure that what I state on on my site is "ok".

My biggest concern is that I intend not to register as money services business (MSB) for some time while I completely research the reporting required among other things. During this time I won't conduct any business that would require me to register as an MSB. Which means I couldn't exchange >= $1000 USD per customer per day, simple enough.

My concern lies in the fact that although I never say I am a registered MSB on my site, I am requiring images of the customer's drivers license (required for some MSB transactions) and, in addition, an image of a utility bill or something similar. So although I'm not a MSB I'm going further than one as far as ID requirements and maintaining records. My original thinking was that it would offer me some protection in case I'm audited. Now I'm not sure if I'm opening myself up to another whole can of worms.

Thanks for your advice.
Sincerely,

Nrobi

 

[tranquility]

Protection from what? If the act covers your actions, there are not partial defenses if the elements are there. The effort and cost of registering is so little, I can't see a reason why you wouldn't do so. Neither will the government if they catch you. If you make a mistake about what the law requires without an effort to register you could be convicted of a felony.

At my work, we're trustees for different trusts. We register as we take in monetary instruments and put them out again. The registration was easy and causes us little difficulty. Why you would consider something so ripe for abuse without the same protection is beyond me.

 

[nrobi]

I will be honest, my brain doesn't make sense, even to myself sometimes. And I dont really know if I explained myself any better here.

I never thought I'd be doing something like this as it is completely different from the coffee store I had been working on. I was talking with someone online two weeks ago, realized how "easy" it was to setup everything and went for it. I've read over the BSA once.

Now that everything is pretty much done except the MSB registration my brain went out and asked all the "what ifs." At that point many things became unclear to me and a great deal of questions popped up. All of which could be answered with many many many hours of me going through the BSA. Time is at a premium (as I assume it is for most people) and I want to get started ASAP. That's essentially the real issue.

So on one hand I have the fear of not properly reporting and recording transactions that should be. My answer to that was to not engage in any such transaction..... which then became don't do any transaction that requires me to register. (I'm not sure why that leap occurred in my brain but it did. Probably because it would ensure the former and is the easiest thing to do.. limit exchanges below $1000 per customer per day.)

On the other hand the thought entered my mind: is it unlawful to give the image that I'm a MSB when I am not. I never state I am a MSB on my website but when looking over the site it is easy to think that I am. I am jumping the customer through a bunch of hoops that they don't have to go through.

What it basically comes down to is that I need to sit down and really go through the BSA with a comb. I want to thank you for your help

-NRobi

In my previous post, in reference to the protection I mentioned, after rereading it it seems to me that it was the ramblings of a sleep deprived person. I'm just doing my best