MERCHANTS EXPRESS MONEY ORDER COMPANY, INC. (MEMO) AGENT ANTI-MONEY LAUNDERING COMPLIANCE GUIDE

Transcription

1 MERCHANTS EXPRESS MONEY ORDER COMPANY, INC. (MEMO) AGENT ANTI-MONEY LAUNDERING COMPLIANCE GUIDE

2 Table of Contents WHY YOU AND YOUR EMPLOYEES SHOULD READ AND UNDERSTAND THIS GUIDE...1 WHY THIS GUIDE IS IMPORTANT TO YOUR MONEY SERVICES BUSINESS AND BUSINESS LOCATION...3 WHAT IS MONEY LAUNDERING?...4 THE BANK SECRECY ACT...5 MSB Registration...5 Agent List...5 WHAT ARE YOUR BSA REPORTING REQUIREMENTS?...6 WHAT ARE YOUR BSA LOGS AND RECORDS REQUIREMENTS?...8 WHAT IS SUSPICIOUS ACTIVITY AND WHAT ARE YOUR SUSPICIOUS ACTIVITY REPORTING REQUIREMENTS?...9 OFAC OFFICE OF FOREIGN ASSETS CONTROL REGULATION AND OTHER REPORTING REQUIREMENTS...13 Other Reporting Requirements...13 PRIVACY OF CONSUMER FINANCIAL INFORMATION...14 ENCLOSURE 1: CURRENCY TRANSACTION REPORT (EXAMPLE ONLY)...16 ENCLOSURE 2: HIGH DOLLAR TRANSACTION REPORT (EXAMPLE ONLY)...17 ENCLOSURE 3: SUSPICIOUS ACTIVITY REPORT BY MONEY SERVICES BUSINESS (EXAMPLE ONLY)...18 Anti-Money Laundering Agent Compliance Guide i

3 WHY YOU AND YOUR EMPLOYEES SHOULD READ AND UNDERSTAND THIS GUIDE Money Services Businesses (MSBs) are governed and regulated by the U.S. Department of the Treasury and the Bank Secrecy Act (BSA). These laws and regulations make it clear that the terms are meant to apply to virtually anyone who handles money. You are a Money Services Business and subject to the BSA, the USA Patriot Act, Office of Foreign Assets Control (OFAC) and other anti-money laundering laws, if you are doing business in one or more of the following capacities, unless you do not perform any of these services in an amount greater than $1, per day to any one person on any day in one or more transactions. Money Orders Traveler's Checks Check Cashing Currency Dealing Currency Exchanges Stored Value Issuer of money orders Seller of money orders Redeemer of money orders Issuer of traveler's checks Seller of traveler's checks Redeemer of traveler's checks Check Casher Currency Dealer Currency Exchanger Issuer of stored value Seller of stored value Redeemer of stored value If you provide money transfer services in any amount, you are defined as an MSB and subject to anti-money laundering requirements. It is not an option, but an important requirement, that you and your employees understand and comply with all anti-money laundering regulations. For failure to comply with the BSA regulations, you and/or your employees are subject to harsh civil fines, criminal penalties, or forfeiture of assets. Civil and criminal fines can quickly reach the tens or hundreds of thousands of dollars while criminal violations can result in long prison terms. In addition, there is the possibility that your business could be held criminally liable for the criminal acts of your employees. Anti-Money Laundering Agent Compliance Guide 1

4 According to Section 352 of the USA Patriot Act and 31 CFR from the Bank Secrecy Act rule that pertains specifically to MSBs, all MSBs must adopt an antimoney laundering program (AML program) that is designed to prevent money launderers and terrorists from using the financial products you provide. Your program must be in writing and include, at a minimum, the following: Internal anti-money laundering policies, procedures, and controls for verifying customer identification, filing reports, making and preserving records, and responding to law enforcement requests for information. As our agent, you are permitted to use our anti-money laundering program as long as you comply with its requirements. Designation of an individual who is authorized to function as your anti-money laundering compliance officer and to oversee your firm s compliance with your AML program. The rule does not require each MSB to employ a full-time compliance officer. The compliance officer may be assigned other responsibilities. An ongoing employee training program that is given to all employees who have contact with customers or are involved in the selling or processing of money orders. The training program should explain the employees responsibilities under the AML program and provide guidance on how to detect and report suspicious transactions. An independent review of your AML program to ensure it is effectively complying with anti-money laundering requirements. Another employee within your business may conduct the independent review as long as the employee is not responsible for compliance. The government requires that you train your employees on the BSA, its regulations, and the money laundering laws. Employees must be trained thoroughly, be knowledgeable about and capable of conducting all transactions in compliance with the current money laundering laws and regulations. Records should be kept of all training conducted. Your business is directly responsible to ensure that a program exists to keep employees trained. Merchants Express Money Order Company, Inc. and subsidiaries (MEMO) has established and implemented its own comprehensive internal compliance and control procedures and policies concerning money laundering. You may adopt these procedures as your own AML program. It is our policy that all of our agents follow the letter and the spirit of the law and the applicable regulations regarding money laundering prevention. We will not tolerate the use of our money orders in money laundering operations and, further, we will not do business with anyone that we determine is knowingly violating applicable law. Anti-Money Laundering Agent Compliance Guide 2

5 This guide should not be constituted as legal advice. You should contact an attorney with any legal questions regarding money laundering laws and regulations or the information in this guide. You must fully understand that your business location bears the responsibility for compliance and the penalties for non-compliance can be severe. This guide is specifically intended to help you comply with anti-money laundering laws and regulations. Additionally, we will keep you informed of any changes to the laws and regulations that might affect you as an agent of MEMO. WHY THIS GUIDE IS IMPORTANT TO YOUR MONEY SERVICES BUSINESS AND BUSINESS LOCATION The use of money orders by money launderers, regardless of where they are issued, is well documented. Money orders are attractive to money launderers because of the ease by which they are redeemed or negotiated. Money orders are instruments that may be made out to "cash" and operate as virtually the equivalent of cash. The U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) has clearly recognized the targeting and potential vulnerability to money laundering of MSBs, just like your business location that sells money orders. FinCEN estimated that, overall, MSBs conduct over $200 billion in transactions per year through approximately 160,000 locations nationwide. The federal government, through FinCEN, issues written regulations that have as their primary goal, the identification and prevention of money laundering. Specifically, the Bank Secrecy Act (BSA) and its underlying Treasury regulations are the regulatory tools that the Department of the Treasury uses to combat money laundering. Additionally, the BSA has been broadened by the USA Patriot Act of 2001, which was adopted in reaction to the terrorist acts on the United States on September 11, The USA Patriot Act contains 52 amendments to the original BSA. IMPORTANT: This guide contains valuable information for you about the current money laundering laws and regulations in which your business location is required to comply with. Anti-Money Laundering Agent Compliance Guide 3

6 WHAT IS MONEY LAUNDERING? It is important that you and all of your employees understand the definition of money laundering and why criminals launder money. The primary intent of this guide is to help you prevent money orders that your business location sells from being used to launder money. Money laundering is a method used by individuals to try to make illegally gained money appear to be legitimate by passing it through a bank or other financial institution. With few exceptions, criminals are motivated by one thing and that is PROFIT. Greed drives the criminal, and the result is that illegally gained money will be introduced into the nation's legitimate financial systems. Why do criminals launder money? Criminals need to conceal their profits, and by engaging in money laundering activities, the criminal transforms the monetary proceeds derived from criminal activity into funds with an apparently legal source. The success of criminal organizations is based, in large part, upon their ability to launder money. Dirty money can take many routes, some complex, some simple, but all increasingly inventive with the ultimate goal to disguise its source. The money can move through banks, check cashers, money transmitters, businesses, and even be sent overseas to become clean laundered money. Money launderers use complicated financial transactions. The tools of law enforcement to combat money laundering must be at least as sophisticated. Whose business is it? Money laundering is not a victimless crime. Not only are numerous innocent people used or deceived by various schemes, but the underground economy, which is untaxed, continues to grow. The IRS already knows that money laundering is everyone's business. Under the authority of the BSA, the U.S. Department of the Treasury has enacted regulations imposing several currency transaction reporting and record-keeping requirements upon all business locations that meet the previously mentioned criteria that defines a business as an MSB. Anti-Money Laundering Agent Compliance Guide 4

7 THE BANK SECRECY ACT The BSA is the centerpiece of the United States money laundering regulatory effort. It authorizes the U.S. Department of the Treasury to require, among other things, certain duties of a very broad range of U.S. financial businesses, including MSBs. Currently, the BSA regulations list 26 entities as financial institutions. One of these entities is an issuer, redeemer, or casher of traveler s checks, checks, money orders, or similar instruments. In addition to compliance responsibilities, MSBs are also subject to BSA civil penalties and other sanctions that may include serious fines. FinCEN through the information required by the BSA, continuously tries to find ways to create and manage information needed by front-line investigators, prosecutors and policy makers. This effort requires the preservation of information at MSBs, including your business location, and, when appropriate, the reporting of that information. The BSA contains basic sets of authorizing provisions that are put into effect by implementing regulations. MSB Registration Each MSB must register with the Department of the Treasury. If you are only an MSB because you serve as an agent of an MSB, you are not required to register. Check cashing businesses are MSBs and are required to register with the Treasury because of their check cashing activity, even though most such businesses are also agents of MSBs. The registration form must be completed and signed by the controlling person or owner of the business. Registration must be renewed every two (2) years. A copy of the registration and other supporting documents must be retained at a business location in the United States for a period of five (5) years. Agent List Each MSB that is required to register must also prepare and maintain a list of its agents. The list must be maintained in the United States. The list must be revised January 1 of each year and must contain agent information for the immediately preceding 12-month period. Upon request, the list(s) must be made available to FinCEN, its designee or the IRS. A copy of the agent list(s) must be kept for five (5) years. Anti-Money Laundering Agent Compliance Guide 5

8 This registration will enable the government to develop a nationwide listing of MSBs to identify and monitor their activities. The initial registration deadline for MSBs was December 31, The registration is required every two (2) years from the initial registration. The BSA requires the reporting of financial transactions of certain types. The provision authorizes the Secretary of the Treasury to require MSBs, like your business, to retain records to assure that the details of financial transactions can be preserved and thereby traced if investigators need to do so. Additionally, the BSA also requires the reporting of suspicious currency transactions. These reports are often all that is needed to trigger investigations. MSBs that provide money transfer services or provide money order or traveler s check services are subject to Suspicious Activity Report (SAR) requirements. Recently, the Treasury proposed that SAR requirements also be extended to currency exchangers. IMPORTANT: Specific reporting of certain transactions, record-keeping and suspicious activity reporting is discussed in this guide for your reference. WHAT ARE YOUR BSA REPORTING REQUIREMENTS? Currency Transaction Reports (CTRs) The BSA regulations require that certain large currency transactions be reported using the applicable forms and reporting procedures. Business locations are required to file Currency Transaction Reports (CTRs), form 104 (formerly form 4789), for currency transactions greater than $10, and send those reports to the IRS. CTRs track large financial transactions and, therefore, generate a paper trail for transactions that would otherwise be invisible. The value of such a paper trail is very obvious. Criminals cannot hide large transactions in illegal proceeds by conducting the transactions in cash. This can make life very difficult both for the narcotics trafficker trying to get cash proceeds into the banking system and for the proponent of a fraud trying to conceal the nature and source of money in a bank account. CTRs are a vital part of financial investigations and are often used to initiate investigations. It is readily apparent that the requirement to file a CTR affects the behavior of criminals. Criminals cannot take the chance that no one will notice the CTR filed against him. The filing of CTRs is very important and you must fully understand this requirement. Anti-Money Laundering Agent Compliance Guide 6

9 If your business location is considered an MSB, as determined by the previously mentioned criteria, you must file a CTR for the sale of money orders to (or on behalf of) the same person which involves more than $10, in currency. This greater than $10, amount includes both the face amounts of the money orders sold and the fees paid by the purchaser. The CTR must also be filed when a customer receives more than $10, from an MSB. Multiple transactions must be treated as a single transaction if you have knowledge that they are by, or on behalf of, the same person totaling more than $10, during any one business day. For your business location, a business day is a calendar day. Before the completion of the CTR, proper identification by the individual conducting the transaction is required. If the customer is a resident of the United States, documents such as a driver's license, military identification card, or other form of identification with name, address and preferably a photograph are acceptable. If your customer is an alien or is otherwise not a resident of the United States, you should require a passport, nonresident alien identification card or another acceptable official document. Ensure that any document shows the customer's nationality and home address and record this information on the CTR. Regulations specifically require that Part 1 of CTR form 104 (formerly form 4789) must have all information correctly filled in. You should note that in addition to the routine name, address and social security number, the form asks for occupation, date of birth, method of identification used, and other important information. The CTR also requires this same information if two or more persons are conducting the transaction, or if the transaction is on behalf of someone other than the customer in front of you. CTR forms are available from your local IRS office and come with a complete set of instructions. The instructions that come with CTR forms state that you must file the form by the 15th calendar day after the day of the transaction with the IRS Detroit Computing Center (DCC). You should keep a copy of each CTR for five (5) years from the date filed. Enclosure 1 is an example of Currency Transaction Report, form 104 (formerly form 4789). You may also obtain copies of BSA forms through FinCEN s web site at For questions regarding the completion of CTRs and other BSA forms, verification of BSA forms or facsimile approval, call the DCC Help Desk: It is advisable to seek the advice of an attorney if you do not understand how and when to use these forms. Civil and criminal penalties are provided for failure to file a CTR or to supply information and/or for filing a false or fraudulent CTR. Anti-Money Laundering Agent Compliance Guide 7

10 Send the completed CTR form 104 (formerly form 4789) to: IRS Detroit Computing Center ATTN: CTR P.O. Box Detroit, MI WHAT ARE YOUR BSA LOGS AND RECORDS REQUIREMENTS? If your business location is considered an MSB under the BSA regulations, the regulations are very clear on exactly what logs and records must be completed and maintained at your business location for certain transactions that you may conduct. Specifically, no business location may sell money orders to any customer for $3, or more in currency unless it maintains records that must be obtained for each issuance or sale to any individual purchaser that involves currency in amounts of $3, to $10, inclusive. Before you complete any transaction that will require a log entry, the regulation requires that your business shall verify the purchaser's name and address by examination of a document that is normally acceptable within the banking community as a means of identification when cashing checks for non-depositors. This document should contain the name and address of the purchaser, and you should record the specific identifying information, e.g., state of issuance and number of the driver's license. As with CTRs, you also must record the customer s social security or alien identification number, and date of birth. Also, if the customer is conducting the transaction for someone else, you must record that person's name, address, social security number, and taxpayer identification number or alien identification number, if provided. For each transaction, you must record the following information: Purchaser s name and address. Purchaser s social security number. If the purchaser is an alien and does not have a social security number, then record the alien identification number or other official identification document. Purchaser s date of birth. Purchase date. The type(s) of instrument(s) purchased, such as a money order. The serial number(s) of each money order. The amount in dollars of each of the money orders purchased. Enclosure 2 is an example of the current MEMO High Dollar Transaction Report that you can use at your business location to maintain your required log. MEMO developed the High Dollar Transaction Report to assist you with the logging requirements required by the BSA. You can order copies of the High Dollar Transaction Report by contacting MEMO customer service at Anti-Money Laundering Agent Compliance Guide 8

11 IMPORTANT: Multiple purchases in cash during one business day totaling $3, or more shall be treated as one purchase if an individual manager or employee of your business location has knowledge that these purchases were made by, or on behalf of, the same person. Logs should be kept for five (5) years from the date of the last entry. WHAT IS SUSPICIOUS ACTIVITY AND WHAT ARE YOUR SUSPICIOUS ACTIVITY REPORTING REQUIREMENTS? If your business location recognizes or has knowledge of suspicious transactions by a customer, you should immediately report it to your local IRS Criminal Investigation Division. The BSA rules require money transmitters and those in the money order and traveler s check businesses to file Suspicious Activity Report by Money Services Business (SAR-MSB) forms on suspicious activity at or above $2, at the place of sale. You must report suspicious activity by a customer or an employee to the federal government on the form called the Suspicious Activity Report by Money Services Business (SAR-MSB). You must file this SAR-MSB report whenever one or more transactions that add up to $2, or more are conducted or attempted at your location and you know, or have suspicion that the transaction: Involves money obtained from some sort of illegal activity. Has no business or apparent lawful purpose and you know of no reasonable explanation for the transaction. The customer is attempting to keep the transaction from being reported by buying money orders in amounts that would not require them to provide information about the transaction. The customer is providing false or expired identification. Two or more individuals who are together split up the transaction so they do not have to provide information about the transaction. Intentional failure to file a SAR-MSB can constitute a criminal act. SAR-MSB forms must be filed within 30 days of the transaction or attempted transaction. Send the completed SAR-MSB forms to: Detroit Computing Center ATTN: SAR-MSB P.O. Box Detroit, MI Anti-Money Laundering Agent Compliance Guide 9

12 Additionally, if a currency transaction exceeds $10, and is suspicious, the institution should file both a CTR, reporting the currency transaction, and a SAR-MSB, reporting the suspicious or criminal aspects of the transaction. A SAR-MSB should be filed no later than 30 calendar days after the date of initial detection of facts that may constitute a basis for filing a SAR-MSB. Structuring To avoid the filing of a CTR, many illegal organizations smurf or structure transactions to avoid and, in fact, evade the required record-keeping and reporting requirements of your business. Structuring transactions is one of the most frequently used methods of avoiding the CTR requirement. A common example of structuring would be a customer buying $5, worth of money orders on two different days, using two individual transactions instead of buying $11, worth of money orders in one transaction on the same day. The clear intent of this customer is to cause or attempt to cause the failure of your business location to file a CTR. This type of activity should be reported on a SAR-MSB. Multiple transactions are another favorite means to structure currency transactions to avoid required record-keeping and reporting requirements by your business. Examples: An example of another suspicious transaction is a customer using cash to buy money orders several times a day or over a period of several days at your business location. In this example, no one transaction is $3,000.00; however, all transactions total $3, Another example would involve different purchasers using cash to buy money orders several times a day at your business location. The different purchasers are conducting the transactions on behalf of the same person and again no one transaction is $3,000.00; however, all transactions total $3, The important fact when dealing with suspicious multiple transactions are that these transactions must be treated as a single transaction if you have knowledge that they are by or on behalf of any one person. For example, a customer buys $2, worth of money orders in the morning and $2, worth of money orders in the afternoon on the same business day. These transactions must be treated as a single transaction because the same person conducted these on the same business day. Anti-Money Laundering Agent Compliance Guide 10

13 The applicable regulatory reporting and recording requirements for MSBs would be required. When does the law provide that you or your employees have knowledge of multiple transactions? If you know a transaction is part of multiple transactions. If someone tells you about multiple transactions. If you witness multiple transactions. If you know a customer is conducting a transaction for another party whom you know has already conducted a previous transaction, you are considered to have knowledge. If you then conduct these transactions, you may be in violation of existing laws. It is for this reason, if you are suspicious about a transaction, you should consider refusing to complete the transaction. Each business location that is required to file SAR-MSBs should be aware of the legal term Willful Blindness. Willful Blindness is defined as the deliberate avoidance of the facts and means that a business location may be held accountable for not reporting a suspicious activity. Civil and criminal charges could be filed against a business location that is negligent in filing SAR-MSBs. Other examples of suspicious activity specifically concerning your business location may include, but are not limited to: Customer refuses to provide identification or explain the purpose of a transaction. Customer is reluctant to proceed with a transaction after being told it must be reported. Customer has a known criminal background and engages in substantial transactions, without a known, legitimate source of funds. Customer conducts cash transactions when his/her employment or business does not ordinarily generate or require such amount of cash. Customer has no apparent source of income, yet conducts repeated transactions. IMPORTANT: Suspicious Activity Reporting has received considerable focus lately from the federal government because it has been credited with uncovering and/or providing vital evidence to successfully prosecuted cases involving a wide variety of illegal activities, including money laundering. The regulations require the reporting of transactions that are conducted in a way designed to evade any BSA requirement, including the currency transaction reporting rules or the monetary instrument record-keeping rules. Anti-Money Laundering Agent Compliance Guide 11

14 If a customer is dealing in legitimate money, there is no legitimate reason why he or she should want to avoid the filing of a CTR or any other BSA requirement. If for any reason a customer tries to evade any BSA requirements, you should consider it suspicious, complete a SAR-MSB and report it to the proper authorities. Reporting suspicious activity should be done in a timely manner with as much detail as possible. Options include calling the IRS Criminal Investigation Division with a report and/or submitting a written report. The hotline telephone number, , is used for reporting SAR-MSBs linked to terrorism. If you call, it is required that you follow-up with a written SAR-MSB. The mailing address and other important information can be found in the instructions that are included with the report. Your business location should then identify and retain a copy of the SAR-MSB and all original supporting documentation or business record equivalent for five (5) years from the date of the SAR-MSB. The BSA s regulations contain "safe harbor" provisions. Federal law provides complete protection from civil liability for all reports of suspected or known criminal violations and suspicious activities to appropriate authorities, including supporting documentation, regardless of whether such reports are filed pursuant to SAR-MSB instructions or are filed on a voluntary basis. Specifically, the law provides that an MSB, and its directors, officers, employees and agents, that make a disclosure of any possible violation of law or regulation, including in connection with the preparation of SAR-MSBs, shall not be liable to any person under any law or regulation of the United States or any constitution, law, or regulation of any State or political subdivision thereof, for such disclosure or for any failure to notify the person involved in the transaction of such disclosure. However, the reporting of such information to the government is a very serious matter and, therefore, consulting an attorney for legal advice may be advisable. The BSA regulations require that SAR-MSB information be kept confidential. Federal law requires that an MSB, and its directors, officers, employees and agents who, voluntarily or by means of a SAR-MSB, report suspected or known criminal violations or suspicious activities may not notify any person involved in the transaction that the transaction has been reported. In other words, it is illegal for anyone from your business to tell any customer, either directly or indirectly, that a SAR-MSB is being filed. Anti-Money Laundering Agent Compliance Guide 12

15 However, communication to the Compliance Department at MEMO may occur lawfully. Enclosure 3 is an example of a Suspicious Activity Report by Money Services Business (SAR-MSB). To order BSA forms call the IRS National Forms Distribution Center at , or Visit these web sites: IRS Web Site: MSB Web Site: OFAC OFFICE OF FOREIGN ASSETS CONTROL REGULATION AND OTHER REPORTING REQUIREMENTS The Office of Foreign Assets Control ( OFAC ) of the U.S. Department of the Treasury administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction. The OFAC regulations have requirements for businesses to identify and freeze the assets of oppressive governments, terrorists, narcotic traffickers and other specially designated persons. A list of Specially Designated Nationals and Blocked entities (SDN list) is maintained by OFAC. This list identifies individuals and entities that have OFAC restrictions against them. Transactions involving individuals or entities on the SDN list are prohibited as blocked transactions. Some of the countries and groups that are currently targeted by OFAC include Cuba, North Korea, Libya, Iraq, Iran, Syria, Sudan and the Taliban. The range of regulations and the business restrictions vary based on the OFAC economic sanctions program. Further information can be obtained from the OFAC web site at Other Reporting Requirements Some states have anti-money laundering regulations similar to the federal regulations. These states require additional reporting and record-keeping requirements by your business. MEMO will notify you of these requirements. However, you are responsible to fulfill the agent requirements. There could be other reporting duties that you may be subject to under the BSA, the USA Patriot Act and other anti-money laundering laws. Governmental reports could be required if the President issues an Executive Order prompting additional reports to be filed by your business. Anti-Money Laundering Agent Compliance Guide 13

16 PRIVACY OF CONSUMER FINANCIAL INFORMATION In connection with serving as a money order sales agent for Merchants Express Money Order Company, Inc. and/or its affiliates (MEMO Money Order Company, Inc., MEMO Money Order Company of New York, Inc.) you may acquire information about consumers as described in this directive, which you must handle as stated in this directive. All financial institutions are required by law to have policies regarding the collection and limited disclosure of information considered nonpublic personal information. Merchants Express Money Order Company, Inc. and/or its affiliates each is considered a financial institution under such law. 1. Information You Might Collect. As a money order sales agent you may collect nonpublic personal information about a consumer from the following sources: Information received from a consumer to facilitate the completion of a Currency Transaction Report, High Dollar Transaction Report or other forms provided to you that include a name, address, and personal identification information. Information about the consumer s transactions with you (as a money order sales agent), Merchants Express Money Order Company, Inc. and its affiliates, or others (such as the consumer s purchases, and parties to the transaction). Such information may be obtained from information that the consumers provide on the transaction forms. This information is necessary to facilitate the consumer s transaction and in connection with compliance of federal and state (where applicable) laws. Merchants Express Money Order Company, Inc. and its affiliates, and you as a money order sales agent, should not collect nonpublic personal information about money order consumers from any other sources. 2. Information You May Disclose, and To Whom you May Disclose Information. You may not disclose, nor may you reserve the right to disclose, any nonpublic information about money order purchasers, consumers, customers, or former customers to anyone, except to Merchants Express Money Order Company, Inc. and/or its affiliates or as otherwise permitted by law. Any such disclosure may and should be for purposes of facilitating the consumer s requested transactions. Anti-Money Laundering Agent Compliance Guide 14

17 3. Security Procedures. You shall restrict access to nonpublic personal information about money order purchasers, customers or former customers to those employees who need to know that information in order to provide financial services to money order purchasers. You shall maintain security techniques that comply with federal regulations to guard all nonpublic personal information. 4. Changes to This Privacy Policy. We reserve the right to modify or supplement this directive and/or our privacy policy at any time. If we make material changes, we will provide a new notice that describes our practices to consumers and thencurrent customers. Anti-Money Laundering Agent Compliance Guide 15

18 ENCLOSURE 1: Currency Transaction Report (Example only) Anti-Money Laundering Agent Compliance Guide 16

19 ENCLOSURE 2: High Dollar Transaction Report (Example only) Anti-Money Laundering Agent Compliance Guide 17

20 ENCLOSURE 3: Suspicious Activity Report by Money Services Business (Example only) Anti-Money Laundering Agent Compliance Guide 18