On De-Risking, Recent Bank Account Closures, The Somalian Remittance Crisis and the loud calls to try
Right at 9 am, in the Cash Room of the Treasury Building last Tuesday, January 13th,, 100+ attendees gathered to participate in the Roundtable.
Bank Discontinuance of MTOs in Australia has been in the news for a couple of
We can’t say that the access to banking accounts problem is new in the Money Transfer Industry, not in the USA or a number of other countries. It was one of the reasons why the NMTA was formed back in 1996, David Landsman, Executive Director, reminds us every now and then. So why is this a such an urgent issue in 2014? I think the answer is that in the last decade a large number of small money transfer companies, with very little capital and minimal compliance structures were the first to go, now is the medium sized, larger companies, well funded, with large investments in technology and compliance the ones that are feeling the brunt. What should the industry do?
Industry In attempting to determine future trends in the payments industry, a good question to
This article was conceived after discussing with colleagues in the industry why the payments world
PART ONE: Cash: Is the payments king dying? or is the king creating its own separate
In my recent visit to Chile, where I traveled to make sure the country would
QUÉ NOS DEJÓ EL 2017 y cómo vemos a la industria en el próximo año. En
We thank our colleague Carlos Grossman, for the report out of Chile where the Antimonopoly
As you recall from the earlier blog, there are many reasons for MSBs to be
Key positive developments in banking for MSBs It’s been a bleak period for money transmitters
De-risking was an acute illness for the Caribbean financial sector in 2015 and 2016. In
Daniel Trías, Consultor y especialista en comercio exterior, banca, finanzas y remesas familiares, fundador de
How De-Risking is changing the face of Financial Services worldwide In July 6th & 8th
Los migrantes mexicanos en los EEUU son los mexicanos de primera clase. Es en general
How the financial crisis, the evolution of Banking and Unbanking and the rise of technology
Update – February 16, 2018 ; New Bill in Oklahoma and Nebraska – Contributed by
Después de una serie de entrevistas a los medios un par de semanas atrás, en
Remesas, impuestos, migración, deportaciones y la construcción del muro
Durante las primarias presidenciales republicanas del año pasado, Donald Trump expuso su propuesta de cómo forzar a México a pagar por el muro de 1,000 millas en la frontera entre Estados Unidos y este país. Los periodistas Bob Woodward y Robert Costa del Washington Post publicaron en Abril 5 de 2016 la noticia (http://wapo.st/2jbWHFn) en la cual Trump manifestaba su intención de amenazar a México con “cortar el suministro de remesas”. Trump envió en esta ocasión un memorando de dos páginas…
On December 12 in São Paulo, Brazil at the 2nd ABRACAM COMPLIANCE DAY an International Commission of Associations of Money Transfers Companies, Non-Bank Financial Services Companies, Foreign Exchange Firms and their Agents, was formed to make a public statement, signed by all the Associations, voicing their extreme concern regarding the negative impacts of “DE-RISKING” in the economic, financial e social areas of several countries in the region. They had met previously in November 11th, as part of IMTC WORLD 2016 “DE-RISKING & BANK DISCONTINUANCE FORUM” that discussed the impact of this practice in the Money Transfer, Remittance and Payment Industry. The termination of correspondent accounts of foreign financial institutions (FFIs) by US Commercial Banks as well as some these US Banks forcing local bank account closures by their corresponding banks in many countries in the region was also discussed at IMTC WORLD in an afternoon round table on Nov. 10, moderated by Daniel Trias.
On November 11th, as part of IMTC WORLD 2016 we will be having a “DE-RISKING & BANK DISCONTINUANCE FORUM” to discuss the impact of this practice in the Money Transfer, Remittance and Payment Industry as well as the U.S. depository institutions termination of correspondent accounts of foreign financial institutions (FFIs) as well as some US Banks forcing local bank account closures by their corresponding banks in many countries in the world.
As we informed all our special Friday Newsletter to subscribers in the UK, the Commonwealth Secretariat invited the International Money Transfer & Payments Industry to the “Disconnecting from Global Finance: A Conversation on De-Risking” meeting that was programmed this past Thursday, August 10th at Marlborough House in London. The meeting was called following the release of the Commonwealth’s report “Disconnecting from Global Finance: The Impact of AML/CFT Regulations in Commonwealth Developing Countries”. Passions ran high at the meeting as money transfer businesses and smaller financial institutions complained about the “detrimental” decline in international banking for many businesses and individuals.
To show how critical MSBs are to the functioning of the U.S. financial system, a 2013 Federal Deposit Insurance Corp. survey found 9.6 million U.S. households did not have bank accounts and 24.8 million households — 20 percent of the U.S. population — were underbanked, meaning they had bank accounts but also used alternative financial services outside of the banking system
Today, MSBs worldwide are caught in a banking crisis showing no signs of relenting. Based on real and imagined enforcement risks, most banks have categorically decided against providing accounts to MSBs, while others have been ordered by regulators to stop serving MSBs. This process of “de-risking,” by which banks terminate relationships with “high-risk” customers, has been brutal for the MSB industry and resulted in unforeseen consequences, including:
The Conference of State Bank Supervisors (CSBS) and the Money Transmitter Regulators Association (MTRA) released an important report on the state of the industry that is a must read for anyone in the industry and a report that all US Money Transmitters should be sending to their banks. The report is entitled “The state of state money services businesses regulation & supervision” and it examines the non-bank financial sector in the US and the bank discontinuance and de-risking challenges the industry faces. But the main objective is to let the banks know of the strict regulations and close supervision the state regulators have on all licensed MSBs.
As I leave Barcelona after IMTC EMEA 2016 this past May 18-20 and I reflect on the industry, I can’t help but feel proud of the work we do at IMTC and the people we serve. Even talking with long-time industry warriors who are tired of the increasing complexity of the sector, I am a positive person and I can’t help but look back on where we started, around 30-35 years ago, and where we are now. Yes, we face many problems: bank discontinuance, regulatory inconsistency, a somewhat tainted image, weak trade groups, just to name a few. But we are a strong and growing sector with new products and services, new client sectors and technology developments that are impressive. Let’s take a partial look at ourselves…
In the past IMTC BRASIL 2016 in Sao Paulo, Leonardo Costa made a presentation available
The Spanish Courts petitioned the European Tribunal for a guidance to clarify Bank Account Closure Cases and the presumption of remittances being high risk
Our IMTC speaker and colleague Antonio Selas from the firm Cremades & Calvo Sotelo in Madrid has been preventing Banks from closing bank accounts of MTOs in Spain by taking to court the banks and convincing judges that Banks are discriminating against their competitors and that their “remittances are high risk” argument has no factual evidence.