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Bill for States to Regulate Small, Nonbank Financial Businesses Clears Senate

August 4, 2014

Author: Edward Goetz.

On August 1st, a measure allowing the U.S. Department of the Treasury to use state examinations for small, nonbank financial businesses cleared the Senate by a voice vote. Having already been passed by the House in May, the legislation is on its way to the President for signature.

The Money Remittances Improvement Act will make it easier for nonbank institutions, such as currency traders and check cashers, to provide remittances to their customers worldwide because the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) will rely on state examinations, rather than federal reporting requirements, to ensure these institutions comply with laws and regulations. In addition to the reduction in regulatory burden on businesses, it will allow FinCEN to focus on institutions of greater risk.

Treasury Secretary Jack Lew said the bill will enhance the Bank Secrecy Act. The legislation enjoyed strong support from the Conference of State Bank Supervisors and the Money Transmitter Regulators Association.

Crowell & Moring will continue to monitor similar legislation passed by the House designed to cut down on bureaucratic red tape for community banks and credit unions and improve their access to funding. Crowell’s attorneys are available to answer questions firms may have on these financial regulatory issues.
Edward Goetz
Manager, International Trade Services – Washington, D.C.
Phone: +1 202.508.8968