Anti-Money Laundering

Compliance Guide

• Reports

MoneyGram • Recordkeeping
Money Orders
• Suspicious
MoneyGram Transactions
Money Transfers
• OFAC

• Patriot Act

© 2002-2006 MoneyGram
 Dear MoneyGram Agent:

The purpose of this guide is to help you and your

employees:
• Detect and prevent money laundering;
WHY YOU • Comply with the Bank Secrecy Act’s
(“BSA”) recordkeeping and reporting
SHOULD requirements;
READ THIS • Comply with the USA Patriot Act;
• Identify suspicious activity; and,
GUIDE • Comply with the requirements of the
Office of Foreign Assets Control
(“OFAC”) and other anti-money laun-
dering regulations.

Your knowledge of the information in this Guide

may help prevent your business from being
victimized by money launderers, and help you
comply with the law. In addition, your compliance
with these requirements may help law enforce-
ment agents in their effort to track down and
capture terrorists who illegally launder money.

It is MoneyGram’s policy to follow the spirit, as

well as the letter of the law. We do not want our
money orders, money transfers and other financial
services to be used for illegal purposes, and we
will not do business with anyone who knowingly
violates the law. Although we cannot take respon-
sibility for you or your employees’ compliance
with the anti-money laundering laws and regula-
tions, we believe this Guide can help you develop
your own effective compliance program.

MoneyGram thanks you for your

shared dedication to the fight against money
laundering and terrorism.

2
 TABLE OF CONTENTS

Businesses and their employees who conduct money order

sales and money transfer transactions must comply with
all anti-money laundering laws and regulations that apply
to them.

Chapter I. Money Laundering Overview (page 5)

Money laundering is the attempt to conceal or disguise
the nature, location, source, ownership, or control of
illegally obtained money. The government requires
businesses like yours to file reports and maintain records.

Chapter II. USA Patriot Act (page 6-9)

You must implement an anti-money laundering program
based on the risks associated with your business, such
as size, location, volume of business, etc.

Chapter III. Recordkeeping (pages 10-11)

You must record information regarding money order
purchases and MoneyGram transactions greater than
$3,000.

Chapter IV. Currency Transaction Report (“CTR”)

(pages 12-14)
You must file a CTR for any transaction greater than
$10,000 in cash.

Chapter V. Structuring (pages 15-16)

Structuring is the illegal act of breaking up a larger
transaction that would normally have to be recorded or
reported into smaller transactions in order to avoid the
recordkeeping or reporting requirements.

Chapter VI. Suspicious Activity Reporting

(pages 17-20)
Suspicious activity involves transactions that appear to
be structured or do not have any legitimate purpose.

3
 You must file a Suspicious Activity Report by Money
Services Business (“SAR-MSB”) whenever suspicious
activity is attempted or occurs and it involves at least
$2,000.

Chapter VII. OFAC and Other Reports (pages 21-22)

The US Treasury Department’s Office of Foreign Assets
Control (“OFAC”) prohibits all US businesses from conduct-
ing business with targeted countries, drug cartels, terrorists
and other specially identified individuals.

All MSBs are required to register with the US Treasury

Department. However, most MoneyGram agents are covered
by MoneyGram’s registration, so they do not have to register
on their own. But all check cashers must register, even if
they are an agent of MoneyGram.

Chapter VIII. Penalties (page 23)

The government can impose severe penalties against
individuals and businesses for violating money laundering
laws and regulations. These penalties can include fines,
imprisonment, and loss of one’s business.

This Guide is not legal advice. If you need legal

advice, you should seek the services of an attorney.

4
 CHAPTER I
MONEY LAUNDERING OVERVIEW

Money laundering is the attempt to conceal or

disguise the nature, location, source, ownership, or
control of illegally obtained money.

This definition covers a wide range of activity. You

need to understand how people launder money so
that you can identify money laundering and know
how to help prevent it.

To help prevent the laundering of cash and to

obtain documentation that may be used to prosecute
money launderers, the government requires
businesses like yours to file specific reports and MSB =
maintain records on certain cash transactions.
MONEY
WHO IS COVERED?

Because you sell money orders and/or money SERVICES

transfers, you are subject to the Bank Secrecy Act
(“BSA”), the USA Patriot Act, OFAC and other
antimoneylaundering laws, and to their reporting and BUSINESS
recordkeeping obligations. The BSA requires
anyone doing business in one or more of the
capacities listed below to comply with these laws:
A. A money transmitter;
B. A seller of money orders, or stored value (other
than a person who never sells such checks or
money orders or stored value in an amount greater
than $1,000 to any person on any day in one or
more transactions);
C. A person engaged in the business of a check
casher (other than a person who never cashes
checks in an amount greater than $1,000 for any
person on any day in one or more transactions).

All entities that are covered by the definitions

above are known as “MSBs” which stands for
Money Services Businesses.
5
 CHAPTER II
ANTI-MONEY LAUNDERING PROGRAM

The USA Patriot Act requires that all MSBs adopt

a written anti-money laundering program that is
reasonably designed to ensure proper
recordkeeping and reporting of certain transactions,
and to prevent your business from being
used to launder money. Your anti-money laundering
program must include, at a minimum, the
following:

A. Internal policies, procedures and controls for:

• Verifying customer identification
• Filing reports
• Creating and retaining records
• Responding to law enforcement requests

B. The designation of a compliance officer who

is responsible for assuring:
• Policies and procedures are followed
• Procedures are updated as needed
• Training and education are provided

C. An ongoing employee training program that:

• Explains policies and procedures
• Teaches how to identify suspicious activity

D. An independent review of your anti-money

laundering program.
• The review should take place as needed and be
as thorough as needed based on the risks
specific to your business
• The review may be performed by one of your
employees but can not be performed by your
compliance officer.

6
The information contained in this Guide will
provide your business with the tools it needs to
build a compliance program that meets the
requirements of the USA Patriot Act. However,
the quality and effectiveness of the program
depends on your commitment to it. The only
opportunity to verify customer information and
identify suspicious activity is at the point of sale.
This can only be done with a knowledgeable,
welltrained staff.

MoneyGram recommends the following steps

in order to satisfy the requirements of the USA
Patriot Act:

First, your business should formally adopt an

anti-money laundering program. This Guide can MSBS
serve as the basis for that program. See Appendix
I for a form that can be used to certify adoption MUST ADOPT
of such a program.

Second, your business must designate a Compli-

COMPLIANCE
ance Officer. The Compliance Officer may be an
employee who has other duties at your business, PROGRAM
but it should be someone in a responsible position.
The Compliance Officer is responsible for
your business’s day-to-day compliance with the
anti-money laundering laws and regulations, and
for ensuring the compliance program is updated
as needed. The Compliance Officer is also
responsible for overseeing your business’s
ongoing education and training program. When
you designate a compliance officer, you should
complete the Designation of Compliance Officer
form contained in Appendix II, and then retain it in
your anti-money laundering compliance files.

7
 Third, your business must establish an em-
ployee-training program for all employees who will
have any involvement with MSB activities. The
education and training should include instruction
on the employees’ responsibilities under the
program, as well as the detection of suspicious
transactions. One good tool for training is this
Guide. All employees should be required to read
this Guide prior to conducting any MSB transac-
tions. In addition, prior to conducting any MSB
transactions, employees should sign a copy of
the form in Appendix III that is then kept in their
personnel file. Employees should also receive
periodic updates to their training, particularly
when there are changes in regulations.

Fourth, your business must subject its anti-

TRAINING IS money laundering program to an independent
review to assure its adequacy. The regulations
state that the scope and frequency of this review
ESSENTIAL should be “commensurate with the risk of the
financial services provided by the money services
FOR AN business.” Such a review should be done
annually, at a minimum. The review may be
conducted by an officer or employee of your
EFFECTIVE business, but it can not be conducted by the
person who is designated as the Compliance
COMPLIANCE Officer. Once again, a form is provided in Appen-
dix IV that can be used to help your business
PROGRAM comply with this requirement.

Finally, it is important that you create

recordkeeping files for your anti-money laundering
program. These files can then be readily ac-
cessed if your business is examined/audited by
state or federal regulators. In addition to files
containing the information described above, you
should have files that are clearly labeled and
contain the following:

8
1. A copy of this Guide in a file labeled “Anti-
Money Laundering Compliance Program” along
with any other compliance guides you may
receive from other vendors, trade associations,
accountants, lawyers, etc. These materials
can serve as the basis for your program. This
file should also contain a copy of the
completed “Certification” form shown in
Appendix I.

2. Multiple copies of the SAR-MSB form shown

in Appendix VII in a file labeled “SAR-MSB”.
This is also where you should maintain copies
of any “SAR-MSBs” that you file with the govern-
ment, along with any supporting materials.
(See Chapter VI for further information on the
SAR-MSB.)

3. For CTRs, money order Logs, and MoneyGram

send and receive forms for transactions of
$3,000 or more do the same as for SAR-MSBs.
(See Chapters III and IV for further information on
Logs and CTRs.)

4. A file for any OFAC reports you may submit, and

any materials you receive regarding OFAC or
Executive Orders. (See page 21.)

5. A file containing any updated information you

receive from regulators or law enforcement
agencies regarding money laundering or
terrorism.

6. A file containing a copy of your business’s MSB

Registration Form, if you were required to
register. (See Chapter VII for further information.)

9
 CHAPTER III
RECORDKEEPING

Recordkeeping for Money Orders:

If a customer purchases money orders, checks or

other monetary instruments, with cash in the
amount of $3,000 to $10,000 certain information
must be obtained and retained. The information
MONEY is to be recorded on a Monetary Instrument Log
(“Log”). Only cash purchases are covered by this
ORDER requirement – purchases by check or credit card
are not, regardless of the amount. Likewise, if a
“LOG” customer makes multiple cash purchases
throughout the same business day that total
between $3000 and $10,000, you must record the
appropriate information on a Log.

$3,000 Appendix V shows a copy of a blank Log. You

may order copies of a Log by contacting your
Account Specialist at 800-257-8418.
TO
Purchases of more than $10,000 require filing a
$10,000 Currency Transaction Report (“CTR”) which is
explained later in these materials.

Verification of Money Order Purchaser’s

Identity. Before completing a transaction that
requires a Log entry, you must verify the name
and address of the individual buying the money
orders by looking at a valid identification docu-
ment, such as a driver’s license, passport or alien
identification card that contains the customer’s
name and address.

You must obtain all of the information required for

the Log before you complete the transaction.

10
Recordkeeping Requirements For Money
Transfers:

Both sending and receiving agents must obtain

and record specific information for money transfers
of $3,000 or more regardless of the method of
payment.

Money Transfer “Sends” and “Receives”: For

money transfer sends and/or receives of $3,000 or
more, you must obtain and record all of the
information requested on both the front and back
of the send/receive form. By completing the front MONEY
and back of the send and receive forms you will
have all of the information that you are required to TRANSFERS
obtain and retain for five years on money transfers
of $3,000 or more.

If you know that the person is sending on

$3,000
behalf of someone else, then you must also
obtain similar information on that other OR MORE
person.

MoneyGram’s Identification Requirements:

1. Before completing any “Send” money transfer

of $900 or more you must verify the customer’s
identity by examining a document that contains
the person’s name, address and preferably
photograph, e.g. driver’s license, passport, alien
identification card or other official document
verifying nationality or residence.

2. MoneyGram requires the same verification

procedure for all “Receives” regardless of the
amount. However, “test” questions are permitted
for money transfers up to $900 if the recipient
does not have acceptable photo identification.
Identification details or the answer to the test
question must be recorded for all receive amounts.

11
 CHAPTER IV
CURRENCY TRANSACTION
REPORTING REQUIREMENTS

A Currency Transaction Report (“CTR”) must be

filed with the federal government for any cash
transaction of $10,000 or more conducted in one
day by any person (or on behalf of another
person). You must treat multiple cash purchases
of money orders or money transfers as a single
transaction if you have knowledge that they are
by (or on behalf of) the same person and total
over $10,000 during one business day. (This
$10,000 amount includes both the face amount of
CTR = the transaction and any fees paid by the cus-
tomer.)
MORE
You must file the CTR report with the Internal
Revenue Service (IRS) on a Currency Transaction
THAN Report - Form 4789, shown in Appendix VI.

$10,000 Identification Requirements for CTRs.

Before conducting any transaction that requires a
CTR you must verify your customer’s name and
IN CASH
address in the following manner:

For U.S. citizens and residents, you must see a

document that banks normally accept when
cashing checks for non-customers, such as a
driver’s license, passport, or a state issued
identification card. For non-resident aliens, you
must see a passport, alien identification card, or
other official document that shows nationality and
home address. In all situations, you should only
accept valid, current identification that contains a
photograph of the customer.

The regulations require that you record your

customer’s name, address and Social Security
number (or taxpayer identification number or
other identifying number) on the CTR. The CTR
form also asks for occupation, date of birth, and
other information.
12
If two or more people are conducting the transac-
tion, or if the transaction is being conducted on
behalf of someone else, you must obtain similar
information for all parties.

You must obtain all of this information before you

complete the transaction.

Identification for Elderly or Disabled Persons.

Elderly or disabled persons may not have identifica-
tion documents, such as a driver’s license or
state-issued identification card. In these cases,
you may accept as appropriate identification a
Social Security, Medicare, Medicaid or other
insurance card presented along with another
document that contains both the name and
address of the individual (e.g., an organization
membership or voter registration card, utility or
real estate tax bill).You must maintain a written
list of the specific types of documents that you or
your employees may accept from elderly or
disabled people.

Filing Requirements for the CTR. You must

prepare and file the CTR within 15 days of the
transaction. The CTR form shows the address
where it is to be filed. Do NOT send CTRs to
TravelersExpress/MoneyGram.

Recordkeeping of CTRs. You must keep a

copy of each CTR for at least five years from the
date of filing.

Question: When do you have knowledge of

multiple transactions conducted by or on
behalf of the same person?
?
A. If you or your employee witness the
multiple transactions;
B. If someone tells you or an employee about
the multiple transactions;
C. If you or an employee know a customer is
conducting a transaction for someone else for
whom you or your employee know has already
conducted another transaction. 13
 ? Question: Do you have to verify the informa-
tion given by the customer?

You must verify the identity of the customer by

viewing an official document that contains the
customer’s name, address and photograph.
Official documents that may be used to verify the
customer’s identity include a driver’s license,
passport, national identification card (i.e., Cedula
card) alien identification card or state-issued
identification card. Although it is not necessary
to verify other information obtained from the
customer, if you believe the information provided
is false, do not complete the transaction and file
CTR an SAR-MSB if applicable.

Exampes of when a CTR must be filed:

EXAMPLES
Example 1: Jim brings in $12,000 in cash and
requests a money transfer or wants to purchase
multiple money orders. You must file a CTR.

Example 2: Jim brings in cash several times

during the same day and requests money
transfers, or purchases money orders which add
up to more than $10,000 (including fees). You
must file a CTR.

Example 3: Jim brings in $11,000 in cash and

requests an $8,000 money transfer and pur-
chases money orders totaling $3,000. You must
file a CTR.

14
 CHAPTER V
STRUCTURING

Many money launderers are familiar with the dollar

threshholds that require recordkeeping and
reporting. Therefore, in order to remain anonymous
and avoid the detection of law enforcement
agents, they will “structure” their transactions so
that the recordkeeping or reporting requirements
will not be triggered. Structuring is the act of
breaking up a potentially large transaction into
several smaller ones.

It is illegal for you or your customer to structure

transactions in order to avoid the recordkeeping or STRUCTURING
reporting requirements. For example, if a cus-
tomer buys $2,000 of money orders with cash in TRANSACTIONS
the morning and $2,000 of money orders with
cash at the end of the day, they may be structur- TO AVOID
ing their purchases in order to avoid the
recordkeeping “Log”.
RECORDKEEPING
AND
Likewise, it is illegal for you or your employees to
assist anyone in structuring transactions in order REPORTING
to avoid recordkeeping or reporting requirements.
For example, you may not tell or even imply to a REQUIREMENTS
customer that they can avoid providing information
by conducting a smaller transaction. Some IS ILLEGAL.
criminals may attempt to trick you or your em-
ployees into allowing them to structure transac-
tions by splitting up transactions with several
accomplices or by trying to “con” you with a
hardluck story. You need to be on the lookout for
structuring so that you can prevent it from occur-
ring.

15
 Question: Are all multiple transactions

? considered structuring?

No. For example, Jim sends two money transfers

to separate receivers, one for $2000 and another
for $1,500. Each transfer is less than $3000 but
the total transaction exceeds $3000. There was
nothing suspicious about the transactions, and
you learn that Jim is sending money to his
children attending two different schools. You
should record the appropriate information on the
back of both send forms in order to fulfill the
recordkeeping requirement and to show there was
no attempt to structure the transactions.

16
 CHAPTER VI
SUSPICIOUS ACTIVITY REPORTING

“Suspicious activity” is a difficult concept to define

because it can vary from one transaction to
another based upon on all of the circumstances
surrounding the transaction, or group of transac-
tions. For example, transactions by one customer
may be normal because of your knowledge
of that customer, while similar transactions by
another customer may be suspicious. Many
factors are involved in determining whether
transactions are suspicious, including the
amount, the location of your business, comments
made by your customer, the customer’s behavior,
etc. That is why it is important for you to read
this Guide in order to help you detect suspicious
activity and structured transactions.

The federal government requires you to file a

Suspicious Activity Report by Money Services
Business (“SAR-MSB”) for any transaction - or
pattern of transactions - that is attempted or
conducted with at least $2,000, that you know,
suspect, or have reason to suspect:

1. Involves funds derived from illegal activity or is

intended to hide funds derived from illegal activity;

2. Is structured to avoid recordkeeping or reporting

requirements; or

3. Has no business or apparent lawful purpose.

You may file an SAR-MSB on suspicious activity

below $2,000, but the regulations do not require it.

17
 Filing the SAR-MSB. You must file an SAR-MSB
with the federal government within 30 days
of the suspicious event. You must keep a copy of
the report and all supporting documentation for at
least five years from the time of filing. Appendix
VII shows the SAR-MSB form and it is also
available at www.treas.gov/fincen, or www.msb.gov
or through the IRS. Do NOT send SAR-MSBs to
TravelersExpress/MoneyGram.

AS OF JULY 1, 2002, THE FEDERAL

GOVERNMENT HAS NOT ISSUED THE NEW
SAR-MSB FORM. THEREFORE, UNTIL IT IS
ISSUED, YOU SHOULD CONTINUE TO USE
THE EXISTING BANK SAR FORM TO
REPORT SUSPICIOUS ACTIVITY.

Federal law provides protection from civil liability

for all reports of suspicious transactions made to
appropriate authorities, including supporting
documentation.

Never Tell Your Customer That You Filed an

SAR-MSB. It is illegal to tell your customer that
you are filing a suspicious transaction report.

If MoneyGram believes that some of your customers

may be misusing its money orders or money trans-
fers, our compliance staff may contact you as part of
an investigation. You must not tell your customer
about such an inquiry.

Question: Should you file supporting documenta-

? tion with the SAR-MSB?

No. You should retain a copy of the SAR-MSB

and all original supporting documentation or
business records (including copies of instruments,
receipts, photographs, surveillance audio
or video tapes, etc.) for five years from the date of
filing the SAR-MSB. All supporting documentation
must be made available to appropriate
authorities upon request. An SAR-MSB report
must be typed or legibly handwritten.
18
Examples of suspicious activity:

Example 1: Jim sends a $4,400 money transfer.

The next day Jim sends $9,400 to the same
person. Jim may be structuring his transactions
in order to avoid the CTR reporting requirements.
You should consider whether a CTR and/or an
SAR-MSB should be filed.

Example 2: Jim purchases money orders with

cash just below $3,000 over the course of several
days. Jim may be structuring his purchases and
you should consider whether an SAR-MSB needs
to be filed, and whether a Log needs to be EXAMPLES
completed.
OF
Example 3: You see Jim hand cash to Bill and
Susan outside your store. Bill and Susan each
SUSPICIOUS
give you cash and purchase money orders that ACTIVITY
total less than $10,000 for each of them. This
appears to be a structured transaction, and may
require the filing of a CTR and/or an SAR-MSB,
and a Log.

Example 4: Jim comes in several times on the

same day to pick up money transfers which add
up to more than $10,000. You must file a CTR if
you paid out more than $10,000 in cash to Jim.
You should also determine whether an SAR-MSB
needs to be filed.

Example 5: Jim and Bill each pick up money

transfers. Neither money transfer alone exceeds
$10,000, but together they exceed $10,000 in
cash. You give Jim and Bill cash in the amount of
their separate money transfers. You then see Jim
and Bill give the cash to Susan. This appears to
be a structured and suspicious transaction. If you
conclude that a structured transaction occurred,
you must file an SAR-MSB. If you conclude that
a structured transaction has not occurred, but you
determine that Jim and Bill are acting on the
behalf of Susan, you must file a CTR. If you are
unable to fully complete the CTR, you must
complete as much as possible and file the CTR. 19
 Example 6: Jim picks up a money transfer
from your location. After Jim has left, you discover
that Jim also picked up money transfers at
some of your other offices on the same day. Jim
may be attempting to avoid the reporting require-
ments. You should consider whether a structured
or suspicious transaction has occurred. If you
conclude that a structured or suspicious transac-
tion has occurred, you must file an SAR-MSB if
the $2,000 (in total) reporting threshold is met. If
the total amount of currency paid to Jim in all
such transactions exceeds $10,000 you must
also file a CTR.

Example 7: Jim says that he wants to send an

$11,000 money transfer that he wants to pay for
with cash. When you tell Jim that you will need to
complete a CTR he says he no longer wants to
do the transaction, or asks how he can avoid
having a CTR filed on the transaction. You must
file an SAR-MSB on the transaction or attempted
transaction.

NOTE: CTRs, SAR-MSBs, AND OTHER

RECORDS AND REPORTS ARE ONLY AS
GOOD AS THE INFORMATION YOU PROVIDE.
THEREFORE, IT IS VERY IMPORTANT THAT
THE INFORMATION YOU PROVIDE ON SUCH
REPORTS IS ACCURATE AND COMPLETE.
THIS IS YOUR RESPONSIBILITY. THE GOV-
ERNMENT AND LAW ENFORCEMENT AGEN-
CIES DEPEND ON THIS INFORMATION AS
THEY FIGHT AGAINST MONEY LAUNDERING
AND TERRORISM.

20
 CHAPTER VII
OFAC AND OTHER REPORTS

The Office of Foreign Assets Control (“OFAC”) of

the Department of the Treasury administers and
enforces U.S. economic and trade sanctions
against targeted foreign countries, terrorists, drug
cartels and others. The OFAC regulations require
all businesses to identify and freeze the assets of
oppressive governments, international terrorists,
narcotic traffickers and other specially designated
persons identified by OFAC.

OFAC maintains a list called the Specially

Designated Nationals and Blocked Entities List
(“SDN List”) that identifies most individuals and
entities against whom the OFAC restrictions
apply. Any type of transaction involving an SDN
is prohibited as a blocked transaction. Some of
the countries and groups that are currently
targeted by OFAC include: Burma, Cuba, Iran,
Iraq, Libya, North Korea, Syria, Sudan, Unita and
the Taliban. The scope of the regulations (and
what businesses may and may not do) varies with
the specific economic sanctions program. Refer
to the OFAC web site (www.ustreas.gov/ofac)
for further information.

OTHER REPORTING REQUIREMENTS

There are other reporting obligations that you may

be subject to under the BSA, the USA Patriot Act
and other anti-money laundering laws. For
example, if the President issues an “Executive
Order” it may also trigger the filing of additional
reports with the government.

Also some states may have specific anti-money

laundering regulations that impose additional
reporting or recordkeeping requirements on your
business.
21
 MSB REGISTRATION

If you engage in MSB activities on your own

behalf - apart from serving as our agent - then you
may be required to register with the U.S. Depart-
ment of Treasury as an MSB. For example, a
supermarket that serves as a money order agent
but performs no other MSB services is not
required to register. However, registration would be
required if the supermarket, in addition to acting
as an agent, also cashes checks in an amount
greater than $1,000 for any person on any day, in
one or more transactions.

The MSB registration must be filed on the form

required by the Department of Treasury and sent
to the address provided on the form.

The MSB must retain a copy of the registration

form and any registration number that may be
assigned to the business for five years.

As this Guide has made clear, it is extremely

important that you and your employees
thoroughly understand the requirements of
SHARE anti-money laundering regulations. We have
provided this Guide to you to help in this
THIS important task. Make sure that all of your
employees read and understand this Guide.
GUIDE
You may obtain additional copies of this Guide
from the MoneyGram website, or by calling your
WITH
Account Specialist at (800) 257-8418.

YOUR If you have any questions about the provision of

the laws and regulations, consult your attorney,
EMPLOYEES as we cannot give you legal advice. The penalties
for non-compliance are severe, and ignorance or
confusion about the regulations and laws is not a
defense.

22
 CHAPTER VIII
CIVIL AND CRIMINAL PENALTIES

The government can impose harsh civil and criminal

penalties against anyone who violates the BSA,
USA Patriot Act, OFAC or other anti-money
laundering laws and regulations. Civil and criminal
fines can quickly reach into the hundreds of
thousands or even millions of dollars. Criminal
violations can result in prison terms. In addition, the
government can seize any property involved in
criminal violations of these laws. This includes your
business, your bank account, or any other assets
the government can link to criminal violations.

Under certain circumstances, the government will

hold businesses criminally liable for the acts of
their employees. It is important that your employ-
ees are trained on anti-money laundering compli-
ance. It is equally important that your business
have a system to ensure that your employees are
complying with the laws and regulations.

The government requires strict compliance with

these laws and regulations. If you do not comply,
you may be subject to large fines, imprisonment,
and possibly the loss of your business or other
assets. MoneyGram will also immediately cancel
the contract of any agent who knowingly or negli-
gently fails to comply with the laws and regula-
tions.

Non-compliance with the law simply is not

worth the risk.

23
 APPENDIX I

CERTIFICATION OF ADOPTION OF
COMPLIANCE PROGRAM

On behalf of this Money Services Business (“MSB”), I

hereby certify, under penalty of perjury, that it has adopted
an anti-money laundering program which complies with all
of the reporting and recordkeeping requirements imposed
by the Bank Secrecy Act, the USA Patriot Act, and any
other applicable anti-money laundering laws or regula-
tions.

Date: _____________________

Signature:______________________________________

Name: _______________________________________

Name of MSB:__________________________________

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 APPENDIX II

DESIGNATION OF COMPLIANCE OFFICER

As of this date, the individual named below is hereby

designated as the Anti-Money Laundering Compliance
Officer (“Compliance Officer”) for this Money Services
Business (“MSB”). The Compliance Officer, as well as
senior management, is responsible for ensuring the
ongoing compliance of this entity with all state and federal
anti-money laundering laws, and for ensuring that all
employees are trained on anti-money laundering require-
ments before conducting any MSB activity, and on an
ongoing basis as needed.

Compliance Officer: ________________________

Date: ________________________

Name of MSB: ________________________

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 APPENDIX III

EMPLOYEE TRAINING

I acknowledge receiving a copy of this Money Services

Business (“MSB”)’s Anti-Money Laundering Compliance
Program. In addition, prior to conducting any transactions
for this MSB, I have received training on the Bank Secrecy
Act reporting and recordkeeping requirements, including
the reporting of suspicious activity.

Employee’s Name: ________________________

Employee’s Signature: ________________________

Date: ___________________

Name of MSB: ________________________

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 APPENDIX IV

CERTIFICATION OF REVIEW

I hereby certify that I have completed an anti-money

laundering compliance review of the Money Services
Business (“MSB”) named herein. I know and understand
the current requirements of the BSA, the USA Patriot Act,
the OFAC regulations and other applicable anti-money
laundering laws. Among other things, this review focused
on the requirements of the USA Patriot Act, which mandates
an anti-money laundering program that includes
policies, procedures and internal controls; employee
training; and the designation of a compliance officer. The
result of my review is that I find this entity’s anti-money
laundering compliance program:

_____Acceptable

_____Acceptable, but recommend the following actions for

improvement: ____________________________________

_____Unacceptable for the following reasons:

_______________________________________________

Signature of Reviewer:______________________

Name of Reviewer:_______________________________

Title of Reviewer: ________________________________

Date:__________________________________________

Name of MSB:__________________________________

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 APPENDIX V

Money Order Log

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 APPENDIX VI

Currency Transaction Report

SAMPLE, NOT ALL PAGES SHOWN 2927

 APPENDIX VII

SAR-MSB

30 SAMPLE, NOT ALL PAGES SHOWN

 ANTI-MONEY LAUNDERING EXPRESS GUIDE

Reporting
• Currency transactions greater than $10,000
(including consumer fees)
Report on CTR – Form 4789
File within 15 days
Follow instructions on form
• Suspicious activity of at least $2,000
Report on SAR-MSB form
File within 30 days
Follow instructions on form
• Structured transactions of at least $2,000
Report as suspicious activity
Report on SAR-MSB form

Recordkeeping
•Transactions of $3,000 or more
(including consumer fees for money orders)

•Verify
Customer’s name and address
Use valid photo i.d. (passport, driver’s license, etc.)
•Record
Customer’s name and address
Type of i.d. provided, i.d. #, and i.d. issuer
Customer’s S.S. # or alien i.d.
Customer’s date of birth
Transaction date
Serial # of money orders or MoneyGram reference #
Amount of transaction
Point of sale address
In addition, for money transfers record:
Receiver’s/Sender’s name and occupation, and
any other information provided about them
If transaction is conducted on behalf of someone else,
record similar information on that other person
• Record information on
“Log” for money orders, or
“Send/Receive” form for money transfers
(any method of payment for money transfers - not just cash)
Maintain copies of all reports and records for 5 years.
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 ANTI-MONEY LAUNDERING EXPRESS GUIDE

USA Patriot Act Requirements for MSBs

•Adopt written anti-money laundering program
•Designate Compliance Officer for their business
•Train employees on anti-money laundering compliance,
including recordkeeping and reporting requirements, as well as
identification of suspicious activity
•Conduct independent review of the compliance program and make
improvements as needed

MSB Registration
•Register with U.S. Treasury on MSB Registration form
•Required for all check cashers, any business that cashes checks for
$1,000 or more, and other independent MSBs.
•Many non-check casher agents are covered by MoneyGram’s
registration
•See Registration form for details

OFAC Sanctions
•U.S. businesses are prohibited from doing business with any country,
entity or person listed on OFAC sanctions list

For Further Information

www.msb.gov
www.treas.gov/fincen
www.treas.gov/ofac
www.temgweb.com

Treasury Department’s Financial Crimes Enforcement Network (FinCEN)

“Hotline” at (800) 949-2732.

Money Transfers at (800) 926-9400

Money Orders at (800) 257-8418

© Copyright MoneyGram 2002-2006.

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