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AGENCY:
Financial Crimes Enforcement Network (FinCEN), Treasury.
ACTION:
Notice and request for comments.
SUMMARY:
As part of its continuing effort to reduce paperwork and respondent burden, FinCEN invites comments on the proposed renewal, without change, of existing information collection requirements found in Bank Secrecy Act regulations that require financial institutions to maintain records related to the issuance or sale of bank checks and drafts, cashier's checks, money orders, and traveler's checks when the issuance or sale involves the use of currency in an amount between $3,000 and $10,000, inclusive. This request for comments is made pursuant to the Paperwork Reduction Act of 1995.
DATES:
Written comments are welcome and must be received on or before November 18, 2024.
ADDRESSES:
Comments may be submitted by any of the following methods:
- Federal E-rulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. Refer to Docket Number FINCEN-2024-0017 and Office of Management and Budget (OMB) control number 1506-0057.
- Mail: Policy Division, Financial Crimes Enforcement Network, P.O. Box 39, Vienna, VA 22183. Refer to Docket Number FINCEN-2024-0017 and OMB control number 1506-0057.
Please submit comments by one method only. Comments will be reviewed consistent with the Paperwork Reduction Act of 1995 and applicable OMB regulations and guidance. All comments submitted in response to this notice will become a matter of public record. Therefore, you should submit only information that you wish to make publicly available.
FOR FURTHER INFORMATION CONTACT:
FinCEN's Regulatory Support Section at 1-800-767-2825, or electronically at frc@fincen.gov.
SUPPLEMENTARY INFORMATION:
I. Statutory and Regulatory Provisions
The legislative framework generally referred to as the Bank Secrecy Act (BSA) consists of the Currency and Foreign Transactions Reporting Act of 1970, as amended by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act) and other legislation, including the Anti-Money Laundering Act of 2020 (AML Act). The BSA is codified at 12 U.S.C. 1829b, 1951-1960 and 31 U.S.C. 5311-5314, 5316-5336, including notes thereto, with implementing regulations at 31 CFR chapter X.
USA PATRIOT Act, Public Law 107-56, 115 Stat. 272 (2001).
The AML Act was enacted as Division F, sections 6001-6511, of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, Public Law 116-283, 134 Stat. 3388.
The BSA authorizes the Secretary of the Treasury (Secretary) to, inter alia, require financial institutions to keep records and file reports that are determined to have a high degree of usefulness in criminal, tax, or regulatory matters, risk assessments or proceedings, or in the conduct of intelligence or counter-intelligence activities to protect against terrorism, and to implement anti-money laundering/countering the financing of terrorism (AML/CFT) programs and compliance procedures. The authority of the Secretary to administer the BSA has been delegated to the Director of FinCEN.
See31 U.S.C. 5311.
Treasury Order 180-01 (Jan. 14, 2020); see also31 U.S.C. 310(b)(2)(I) (providing that FinCEN Director “[a]dminister the requirements of subchapter II of chapter 53 of this title, chapter 2 of title I of Public Law 91-508, and section 21 of the Federal Deposit Insurance Act, to the extent delegated such authority by the Secretary.”).
The BSA prohibits financial institutions from issuing any “bank check, cashier's check, traveler's check, or money order to any individual in connection with a transaction or group of such contemporaneous transactions which involves United States coins or currency (or such other monetary instruments as the Secretary may prescribe) in amounts or denominations of $3,000 or more” unless the individual either (1) has a verified transaction account with the financial institution; or (2) furnishes the financial institution with the information required by regulations and that information is verified and recorded by the financial institution, along with the method of account verification or the information required to be furnished. To implement these requirements, FinCEN issued a regulation requiring financial institutions to maintain records related to the issuance or sale of bank checks and drafts, cashier's checks, money orders, and traveler's checks. The regulation applies to all financial institutions as defined in 31 CFR 1010.100(t). However, as a practical matter banks and money services businesses (MSBs) are the types of financial institutions most likely to issue or sell bank checks and drafts, cashier's checks, money orders, and traveler's checks.
31 CFR 1010.415. This regulation was originally published in 1990 as 31 CFR 103.29. See Amendment to the Bank Secrecy Act Regulations Relating to Identification Required to Purchase Bank Checks and Drafts, Cashier's Checks, Money Orders and Traveler's Checks, 55 FR 20139 (May 15, 1990). It was modified slightly in 1994. See FinCEN, Amendments to the Bank Secrecy Act Regulations Relating to Identification Required to Purchase Bank Checks and Drafts, Cashier's Checks, Money Orders, and Traveler's Checks,59 FR 52250 (Oct. 17, 1994).
31 CFR 1010.100(t) defines financial institution to include: banks; brokers or dealers in securities; MSBs, telegraph companies; casinos and card clubs; persons subject to supervision by any state or Federal bank supervisory authority; futures commission merchants, introducing brokers in commodities; and mutual funds. It is FinCEN's assessment that banks and MSBs are the only types of financial institutions as defined under 31 CFR 1010.100(t) that are in the business of issuing or selling bank checks and drafts, cashier's checks, money orders, and traveler's checks.
31 CFR 1010.100(ff)(3) defines an MSB that is an issuer or seller of traveler's checks or money orders as a person that issues or sells traveler's checks or money orders in an amount greater than $1,000 to any person on any day in one or more transactions. FinCEN can estimate the number of principal MSBs that report that they are issuers and/or sellers of money orders or traveler's checks on FinCEN Form 107—Registration of Money Services Businesses (RMSB). However, FinCEN cannot estimate the number of agent MSBs that may be issuers and/or sellers of money orders or traveler's checks. FinCEN assesses that given that an MSB is only defined as an issuer and/or seller of traveler's check if it issues or sells money orders and/or traveler's checks that accumulate to greater than $1,000 to any one person on any day in one or more transactions that most agent MSBs are less likely to reach the $1,000 threshold that would warrant compliance with 31 CFR 1010.415. For that reason, the burden estimates to comply with this information collection as described in tables 1 and 2 below only account for principal MSBs that have reported on the RMSB that they are issuers and/or sellers of money orders or traveler's checks. The threshold of between $3,000 and $10,000 to comply with 31 CFR 1010.415 makes it even more unlikely that agent MSBs are engaged in such transactions.
Under 31 CFR 1010.415, financial institutions are required to maintain records of certain information related to the issuance or sale of bank checks and drafts, cashier's checks, money orders, and traveler's checks when the issuance or sale involves currency between $3,000 and $10,000, inclusive, to any individual purchaser of one or more of these instruments. Under 31 CFR 1010.415(a)(1)(i), if the purchaser has a deposit account with the financial institution, the financial institution is required to maintain records of: (A) the name of the purchaser; (B) the date of purchase; (C) the type(s) of instrument(s) purchased; (D) the serial number(s) of each of the instrument(s) purchased; and (E) the amount in dollars of each of the instrument(s) purchased. Under 31 CFR 1010.415(a)(1)(ii), the financial institution must also verify that the individual is a deposit accountholder or must verify the individual's identity.
31 CFR 1010.415(a)(1)(ii) (stating that “[v]erification may be either through a signature card or other file or record at the financial institution provided the deposit accountholder's name and address were verified previously and that information was recorded on the signature card or other file or record; or by examination of a document which is normally acceptable as a means of identification when cashing checks for nondepositors and which contains the name and address of the purchaser. If the deposit accountholder's identity has not been verified previously, the financial institution may only verify the deposit accountholder's identity by examination of a document which is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors and which contains the name and address of the purchaser, and must also record the specific identifying information ( e.g., State of issuance and number of driver's license))”.
Under 31 CFR 1010.415(a)(2)(i), if the purchaser does not have a deposit account with the financial institution, the financial institution must maintain a record of: (A) the name and address of the purchaser; (B) the social security number of the purchaser, or if the purchaser is an alien and does not have a social security number, the alien identification number; (C) the date of birth of the purchaser; (D) the date of the purchase; (E) the type(s) of instrument(s) purchased; (F) the serial number(s) of the instrument(s) purchased; and (G) the amount in dollars of each of the instrument(s) purchased. Under 31 CFR 1010.415(a)(2)(ii), the financial institution must also verify the purchaser's name and address by examination of a document that is normally acceptable as a means of identification when cashing checks for nondepositors and that contains the name and address of the purchaser, and must also record the specific identifying information.
Under 31 CFR 1010.415(b), financial institutions must treat contemporaneous purchases of the same or different types of instruments totaling $3,000 or more as one purchase. Multiple purchases during one business day totaling $3,000 or more must be treated as one purchase if an individual employee, director, officer, or partner of the financial institution has knowledge that these purchases have occurred.
Under 31 CFR 1010.415(c), financial institutions must retain all required records for a period of five years and make those records available to the Secretary upon request at any time.
II. Paperwork Reduction Act of 1995 (PRA)
Public Law 104-13, 109 Stat. 163 (codified at 44 U.S.C. 3506(c)(2)(A)).
Title: Purchases of bank checks and drafts, cashier's checks, money orders, and traveler's checks (31 CFR 1010.415).
OMB Control Number: 1506-0057.
Report Number: Not applicable.
Abstract: FinCEN is issuing this notice to renew the OMB control number for the recordkeeping requirement for the issuance or sale of bank checks and drafts, cashier's checks, money orders, and traveler's checks when the issuance or sale involves the use currency in an amount between $3,000 and 10,000, inclusive.
Affected Public: Businesses or other for-profit institutions, and non-profit institutions.
Type of Review: Renewal without change of a currently approved information collection.
Frequency: As required.
Estimated Number of Respondents: 23,207 financial institutions.
Table 1 below describes the distribution of the types of financial institutions covered by this notice.
Estimated Recordkeeping Burden:
In Part 1 of this analysis, FinCEN describes the distribution of the estimated number of financial institutions by type affected by the regulatory requirements. In Part 2, FinCEN describes the primary characteristics of the regulatory requirements. In addition, in Part 2, FinCEN proposes for review and comment a renewal of the calculation of the annual PRA burden that includes a scope and methodology similar to that used in the 2021 notice to renew these information collection requirements.
See FinCEN, Agency Information Collection Activities; Proposed Renewal; Comment Request; Renewal Without Change of Purchases of Bank Checks and Drafts, Cashier's Checks, Money Orders, and Traveler's Checks,86 FR 6411 (Jan. 21, 2021).
Part 1. Distribution of the Financial Institutions Covered by This Notice
The distribution of financial institutions, by type, covered by this notice is reflected in table 1 below:
Table 1—Distribution of Financial Institutions Covered by This Notice, by Type of Financial Institution
| Type of financial institution | Number of financial institutions |
|---|---|
| Banks | 10,062 |
| Banks with a Federal functional regulator (FFR) | 9,462 |
| Banks lacking an FFR | 600 |
| Principal MSBS—Issuers/Sellers of Money Orders/Traveler's Checks | 13,145 |
| Principal MSBs—Issuers/Sellers of Money Orders Only | 11,764 |
| Principal MSBs—Issuers/Sellers of Money Orders and Traveler's Checks | 1,318 |
| Principal MSBs—Issuers/Sellers of Traveler's Checks Only | 63 |
| Total | 23,207 |
| This estimate of the total number of banks with an FFR, including credit unions, is based on end of year 2023 data as provided by each of the FFRs, respectively. The FFRs are the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the National Credit Union Administration. | |
| This estimate of active entries as of year-end 2023 was derived in consultation with staff from the Internal Revenue Service's Small Business/Self-Employed Division and incorporates data from both public and non-public sources, including: Call Reports; various State banking/financial institution regulators' websites and directories; the Federal Reserve Board of Governors' Master Account and Services database ( https://federalreserve.gov/paymentsystems/master-account-and services-database-exisiting-access.htm ); and data from the Commonwealth of Puerto Rico Oficina del Comisionado de Instituciones Financieras (OCIF). | |
| This number is derived from data as self-reported by MSBs identified as active at year-end 2023 in FinCEN's publicly available MSB registration database. FinCEN, MSB Registrant Search, available at https://www.fincen.gov/msb-state-selector (downloaded Feb. 28, 2024). |
Table 2—Distribution of Estimated Total Annual Burden Hours of Maintaining Recordkeeping Requirements for Issuance/Sale of Bank Checks and Drafts, Cashier's Checks, Money Orders, or Traveler's Checks
| Affected financial institution type | Number of financial institutions | Average annual burden estimate per financial institution in hours | Total annual burden hours |
|---|---|---|---|
| Banks | 10,062 | 7.5 | 75,465 |
| Issuers/sellers of money orders | 11,764 | 7.5 | 88,230 |
| Issuers/sellers of money orders and traveler's checks | 1,318 | 7.5 | 9,885 |
| Issuers/sellers of travel checks | 63 | 7.5 | 473 |
| Total annual burden hours | 174,053 |
Table 3—Estimated Total Cost of Annual PRA Burden
| Regulatory requirement | Burden hours | Wage rate | Total cost |
|---|---|---|---|
| Verifying and maintaining records | 174,053 | $106.30 | $18,501,833.90 |
| Total annual cost | 18,501,833.90 |