News
U.S. Border Agents to Begin Testing Prepaid Card Readers Ahead of Final Reporting Rules
By Colby Adams
printAmerican officials will begin field-testing prepaid card readers at U.S. border stops next month as part of the lead-up to the Treasury Department regulations governing their cross-border transport, say officials. Three months after finalizing anti-money laundering (AML) rules for stored value providers and sellers in July 2011, the department's Financial Crimes Enforcement Network (FinCEN) separately proposed requiring individuals to declare when they are entering or leaving the United States with more than $10,000 in prepaid cards, just as they must with cash. The field tests will shortly precede FinCEN's expected finalization of the rules in December, said John Tobon, chief...
TO READ THE FULL STORY
Related News
Prompted by signs that criminals are increasingly exploiting prepaid cards, federal and state investigators are turning to a handful of recent legal decisions to justify reading the value held on the instruments, sources say.
An apparent decision by White House officials to postpone the issuance of final rules governing the cross-border transport of prepaid access products has once again drawn criticism from U.S. lawmakers.
A congressionally-mandated plan to require U.S. border crossers to declare funds held on prepaid cards remains stalled at the White House more than a year after its submission for final review.
The rise of online vendors offering to buy bulk gift cards is drawing the attention of investigators who believe the nascent industry may serve as an avenue for money launderers.
The theft of $45 million by cybercriminals exploiting and manipulating stolen prepaid card data highlights weaknesses in how financial institutions monitor the use of stored value products, say security experts.
U.S. lawmakers Thursday criticized federal officials for delays in finalizing anti-money laundering rules and failing to prosecute banks and bankers that facilitate billions of dollars in illicit transactions.
As U.S. officials work to shield American prepaid cards from abuse by financial crooks, foreign-issued stored value products remain a relatively easy avenue to move money into the United States anonymously.
Lobbying by the world's largest stored value payment facilitator has indefinitely delayed, and perhaps permanently blocked, a plan to give customs officials the ability to read prepaid cards, say sources.
Trade-based schemes and bulk cash smuggling are among the most common tactics used by international money launderers, according to Joseph Gallion, the deputy assistant director of the Financial, Narcotics and Special Operations Division for the Homeland Security Investigations (HSI).
Border banks are accepting potentially fraudulent copies of cash declaration forms to justify bulk cash deposits by individuals traveling from Mexico into the United States, say law enforcement officials.
Disputes and confusion over which companies will be responsible for anti-money laundering rules on stored value products has delayed federal registration and oversight of the sector, say industry representatives.
The U.S. Treasury Department Tuesday prescribed new compliance rules on the prepaid product industry, a sector largely unregulated despite concerns about its vulnerability to money launderers.
A dearth of U.S. Treasury Department regulations governing the cross-border transportation of prepaid access products has hamstrung American efforts to combat Mexican drug-trafficking organizations, according to lawmakers.
Senators chastised the U.S. Treasury Department Wednesday for delays in regulating prepaid access products that can be used to smuggle drug proceeds from the United States into Mexico.
The U.S. Treasury Department's proposals to better regulate prepaid access products fail to outline how the new rules will be implemented and enforced, according to a governmental watchdog group.
Several banks are asking the U.S. Treasury Department's financial crimes bureau for the unthinkable: more anti-money laundering compliance responsibilities.
Proposed regulations by the U.S. Treasury Department on the prepaid card industry are raising questions and concerns among anti-money laundering compliance consultants on how the rules can be implemented and enforced.
Money services businesses and sellers of stored value cards will know this summer whether final rules by the U.S. Treasury Department will increase their anti-money laundering compliance duties and costs.
The U.S. Treasury Department will miss a Feb. 22 deadline set by Congress to implement rules subjecting stored value cards to the Bank Secrecy Act, according to consultants and bank lobbyists.