Banks Urged to Spell Out AML Compliance Duties in Pacts with Third Parties

By Matt Squire

Banks that use third parties to manage and distribute their stored-value, or prepaid, cards must make sure Bank Secrecy Act compliance responsibilities are clearly designated, anti-money laundering compliance consultants say. Banks introducing these developing products often partner with outside processors, program managers and, in some cases, a distribution network including nonbanking entities. Consultants participating in a seminar on emerging payment products at the American Bankers Association regulatory compliance conference in Atlanta on Tuesday, urged banks to pick their partners carefully before entering into contracts. "You want to be standing with people that you trust and share your same commitment to...