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FinCEN Licensing and Convertible Virtual Currency Guidance

The Financial Crimes Enforcement Network of the US Department of the Treasury has created a guide to the Bank Secrecy Act which requires that businesses engaging with virtual currencies are subject to registration, reporting, recordkeeping and other anti-money laundering requirements. The Guide defines virtual currency as 'a medium of exchange that can operate like currency but does not have all the attributes of ‘real’ currency… including legal tender'. Convertible Virtual Currency (CVC) refers to a type of virtual currency that ‘has an equivalent value as ‘real’ currency, or ‘acts as a substitute for ‘real’ currencies' – like most stablecoins. Under the guidance, whether people are within the regulatory scope depends on their activities. Users who obtain CVCs to purchase goods or services will not fall into the BSA requirements, in contrast to administrators or exchanges of virtual currency that accept, transmit, buy or sell CVCs – qualifying as ‘money service business’.

January 2021 Financial Crimes Enforcement Network (FinCEN)

FinCEN extended the reopened comment period for proposed rulemaking on certain convertible virtual currency and digital asset transactions, to 29 March 2021.

July 2020 Financial Crimes Enforcement Network (FinCEN)

FinCEN issued an advisory for financial institutions about cybercrime and cyber-enabled crime observed during the COVID-19 pandemic. It warned that some phishing emails lure victims by advertising ways to make money, for example by investing in convertible virtual currencies.

July 2020 Financial Crimes Enforcement Network (FinCEN)

FinCEN issued an alert about a high-profile scam exploiting Twitter accounts to solicit fraudulent payments denominated in convertible virtual currency (CVC). Cyber threat actors compromised the accounts of public figures, organisations, and financial institutions to solicit payments to CVC accounts, claiming that any CVC sent to a wallet address would be doubled and returned to the sender.

FinCEN said that it was critical that CVC exchanges and other financial institutions identify and report suspicious transactions associated with this type of activity as quickly as possible.

February 2012 Financial Crimes Enforcement Network (FinCEN)

FinCEN published guidance 'Money Services Business (MSB) Registration'.

On February 24, 2012, the Financial Crimes Enforcement Network (FinCEN) issued a final notice requiring the electronic filing of most FinCEN reports by July 1, 2012. Institutions are encouraged to begin using the BSA E-Filing System as soon as possible. For more information about mandatory E-Filing, see Frequently Asked Questions (FAQs), and the E-Filing webinar.

With few exceptions, each money services business (MSB) must register with the Department of the Treasury. A person that is an MSB solely because that person serves as an agent of another MSB is not required to register.

Registration of an MSB is the responsibility of the owner or controlling person of the MSB and must be filed by the registration deadline. The form, Registration of Money Services Business, FinCEN Form 107, must be completed and signed by the owner or controlling person and filed within 180 days after the date on which the MSB is established.

Registration must be renewed every two years. Re-registration is required in limited circumstances.

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