State Licensing of Money Transmitters

Helping Parties Obtain Money Transmitter Licenses in Every State

If you want to conduct business as a money transmitter in a certain state, your Company may be required to obtain a license in said state. Federal and state regulations are strict regarding all types of monetary transmissions, and you must first obtain the proper license and authority before you can work in this type of business. 

At Bates Group LLC, we assist clients in obtaining their money transmitter license, as well as with compliance following licensure and the start of operations. If you would like to learn more about our services regarding state licensing, please contact our team directly. 

Do You Need a Money Transmitter License?

Every state has its own definition of what constitutes a “money transmitter,” which means it can be difficult to know whether you need a license for your company’s operations. For example, some states exempt digital currency operations from needing a license, while other states do not. We can evaluate your situation and advise whether we believe you need a license for your particular business model. 

Generally speaking, any party that completes transactions over $1,000 in a day can qualify as a money transmitter if the transactions include: 

• Currency exchanging or dealing
• Check cashing
• Money orders
• Traveler’s checks
• Money transfers

To be on the safe side, let us evaluate your licensing requirements for your intended operations.

Meeting Licensing Requirements 

Once you determine that you need a money transmitter license, you must meet specific requirements, which can vary significantly from state to state. Some common requirements in most states may include:

• Submission of a state-specific Money Transmitter Application
• Meeting a Net Worth requirement and presenting a Statement of Net Worth 
• Company’s Good Standing Certificate (State of Formation & State the Company is applying in)
• Background Checks & Fingerprints for Control Persons
• AML Compliance Program
• Internal Policies & Procedures
• Personal Financial Statements for Control Persons
• Paying licensing fees
• Obtaining a Surety Bond or another form of security

Applications also can require a substantial amount of supporting documentation. This can include a detailed business plan that details the financial health and intended operations of the business, financial statements and records for shareholders and directors, and your background check information. In addition, you will need to present your anti-money laundering (AML) policies and procedures that are in line with the requirements enforced by the Financial Crimes Enforcement Network (FinCEN), which is part of the U.S. Department of Treasury.

License Maintenance

In addition to license acquisition, we can also complete all required aspects of the license maintenance process including, but not limited to:

• Staying up-to-date on the license maintenance requirements for all states where the Client holds a license
• Coordinating with the Client on all MSB reporting requirements
• Completion and submission of the Money Services Business (MSB) Call Report every quarter in NMLS
• Completion and submission of all other state MSB Quarterly Reports that are due outside of NMLS
• Completion and submission of all state MSB Annual Reports that are due throughout the year
• Coordinating with state regulators on any questions they have and/or documentation they need related to MSB licensing throughout the year
• Uploading documentation and update relevant information in NMLS if changes within the Client require uploading/updating (Policies & Procedures, Address, Business Plan, Risk Assessments, etc.)
• Submitting the Client’s Annual Financial Statement each year in NMLS and anywhere else that a state may require it to be uploaded for the maintenance of their MSB licenses
• Submitting the Authorized Agent Report each quarter in NMLS (whether the Client uses agents or not, it must be submitted)
• Periodic review of the Client’s NMLS account for any deficiencies identified by state regulators
• Coordinating with Client personnel on any information that is needed to complete required reports, forms, assessments, etc. related to their MSB licenses
• Coordinating with the Client on any MSB licensing-related renewal requirements

Other US Territories/Jurisdictions: MSB Regulators

(GU) Guam Money Transmitter License
Department Website: Guam Department of Revenue and Taxation

(MP) Northern Mariana Islands Money Transmitter License
Department Website: CNMI Department of Commerce

(PR) Puerto Rico Money Transmitter License
Department Website: Commissioner of Financial Institutions of Puerto Rico

(VI) U.S. Virgin Islands Money Transmitter License
Department Website: Virgin Islands Division of Banking and Insurance

Offering Mock State Examinations

In order to obtain and maintain your money transmitter license, your state will likely conduct thorough examinations of your business and all owners, including reviewing detailed financial records of the company. Bates Group LLC, conducts mock state examinations to identify any potential issues that might cause a delay, denial, or suspension of your license. This is a key part of the licensing process that can halt your application if your business affairs are not completely in order. 

Contact Our State Licensing Team for Additional Assistance and Information

If you would like to learn more about how to obtain a state money transmitter license, please speak with our state licensing team at Bates Group LLC. Contact us to discuss your options today.