US-based law-compliant exchanges

[Joe200]

What are all the US-based law-compliant exchanges? Whether market or fixed rate.

Are there any good ones? What are their pros and cons?

CampBX could be good, but they have such a low volume. What else is out there?

[1715390419]

1715390419

[1715390419]

1715390419

[1715390419]

1715390419

[zeroblock]

There is none.

[DealMaker]

Campbx is lying about being compliant.  They are currently mishandling my identification and ignoring literally all messages from anyone having a problem with them.  Check out my current on-going thread here -> https://bitcointalk.org/index.php?topic=278973.0

[DeathAndTaxes]

What are all the US-based law-compliant exchanges? Whether market or fixed rate.

Are there any good ones? What are their pros and cons?

CampBX could be good, but they have such a low volume. What else is out there?

Compliance is a big unknown right now.  It also depends on what you believe is required for compliance and no two people have the same opinion.  It doesn't help that FinCEN guidance is about as clear as mud (and contradicts prior guidance).  It also doesn't help that in the US you also have fifty states.  It also doesn't help that regulators generally are not innovators and Bitcoin is something radically new which doesn't fit neatly into an existing box.

Still lets take a look at what you could mean by complaint.

As for registered with FinCEN?  All
AFAIK all US exchanges (market and direct) have registered, even the shutdown bitfloor was register.

As for compliant with BSA procedures? Unknown
 MSB are required to (and this is the brief non-legal version):
* verify customer identification (KYC).
* screen customers against OFAC, SDN and other "bad lists".
* develop, implement, and audit an anti-money laundering program (AML).
* keep records of transactions.
* report cash tx over $10K (cash in this case meaning physical money), supicious transactions (SAR), funds transfers of Americans to foreign banks.
* prevent/block if possible tx which violate AML procedures, involve terrorism/drugs/illegal activity (if known).
* work with other financial institutions to aid overall KYC/AML system (MSB are considered a "financial institution" as are banks).
Really the only thing an outsider can know for sure if an entity verify customers because they can see what the entity requires of them.  Honestly the rest is all internal and you really have no idea if they are compliant or not.  You will know they aren't when the feds take legal/law enforcement action.

As for registered as a money transmitter in all states?  None
There is some uncertainty as to if bitcoin exchanges meet MT definition at the state level and if they do for which states.  For example in most states a fiat currency exchanger (sells USD for EUR) is not a money transmitter, neither is a gold dealer, commodity dealer, broker dealer (equities), FOREX dealer, etc.   To make it more complicated every states has different language.  As an example more than one state specifically uses the wording "currency of the United States or foreign government" which by definition would exclude Bitcoin.  Even if a MT license is required in all other states it likely isn't in a state with language like that (disclaimer this is not legal advice just my personal opinion).   Some states are more open ended language, and some states use such vague language that essentially any financial transaction could be consider money transmission.  Even when the law is clear it doesn't always mean the states will follow it.  In VA & CA they have taken action (notices only) contrary to their own regulation. The "state issue" is going to be a big one and likely will take years to resolve.  However if you are believe a MT license is required in all states for an exchange to be compliant the answer is simple.  There are no Bitcoin exchanges anywhere in the world with a MT license in all fifty states.   

Note these requriements would apply for any foreign exchange accepting tx from US residents too.  IIRC no foreign exchange has even registered with FinCEN so the answer to the above questions would be none, none and one.

[DealMaker]

What are all the US-based law-compliant exchanges? Whether market or fixed rate.

Are there any good ones? What are their pros and cons?

CampBX could be good, but they have such a low volume. What else is out there?

Compliance is a big unknown right now.  It also depends on what you believe is required for compliance and no two people have the same opinion.  It doesn't help that FinCEN guidance is about as clear as mud (and contradicts prior guidance).  It also doesn't help that in the US you also have fifty states.  It also doesn't help that regulators generally are not innovators and Bitcoin is something radically new which doesn't fit neatly into an existing box.

Still lets take a look at what you could mean by complaint.

As for registered with FinCEN? All
AFAIK all US exchanges (market and direct) have registered, even the shutdown bitfloor was register.

As for compliant with BSA procedures? Unknown
 MSB are required to (and this is the brief non-legal version):
* verify customer identification (KYC).
* screen customers against OFAC, SDN and other "bad lists".
* develop, implement, and audit an anti-money laundering program (AML).
* keep records of transactions.
* report cash tx over $10K (cash in this case meaning physical money), supicious transactions (SAR), funds transfers of Americans to foreign banks.
* prevent/block if possible tx which violate AML procedures, involve terrorism/drugs/illegal activity (if known).
* work with other financial institutions to aid overall KYC/AML system (MSB are considered a "financial institution" as are banks).
Really the only thing an outsider can know for sure if an entity verify customers because they can see what the entity requires of them.  Honestly the rest is all internal and you really have no idea if they are compliant or not.  You will know they aren't when the feds take legal/law enforcement action.

As for registered as a money transmitter in all states?  None
There is some uncertainty as to if bitcoin exchanges meet MT definition at the state level and if they do for which states.  For example in most states a fiat currency exchanger (sells USD for EUR) is not a money transmitter, neither is a gold dealer, commodity dealer, broker dealer (equities), FOREX dealer, etc.   To make it more complicated every states has different language.  As an example more than one state specifically uses the wording "currency of the United States or foreign government" which by definition would exclude Bitcoin.  Even if a MT license is required in all other states it likely isn't in a state with language like that (disclaimer this is not legal advice just my personal opinion).   Some states are more open ended language, and some states use such vague language that essentially any financial transaction could be consider money transmission.  Even when the law is clear it doesn't always mean the states will follow it.  In VA & CA they have taken action (notices only) contrary to their own regulation. The "state issue" is going to be a big one and likely will take years to resolve.  However if you are believe a MT license is required in all states for an exchange to be compliant the answer is simple.  There are no Bitcoin exchanges anywhere in the world with a MT license in all fifty states.  

Note these requriements would apply for any foreign exchange accepting tx from US residents too.  IIRC no foreign exchange has even registered with FinCEN so the answer to the above questions would be none, none and one.

100% correct, this vagueness allows also a lot of speculation into that arena as well and the determination of "who's good or bad".  At the moment what's happening on the law enforcement side in the background is that they are actively waiting for complaints.  Without even doing an FOIA request you can see that the FinCEN is not using the regulatory stuff until AFTER they've received complaints on a large scale (100+).  This is also why I was trying so hard to get Campbx to do the right thing because right now they are about to break that complaint level which is going to FORCE the FinCEN to take action against them.  We all know that the FinCEN/whoever will blow this situation up into various criminal charges because they also won't see it from certain perspectives such as "bad customer service".  In fact I can tell you without a single doubt they are monitoring forums just like this to also "hunt" for bad exchanges because when they get in the public eye it's easier to have this bad exchange go down because when you do research all you see is massive amounts of customer complaints building, and building, and building up.  Bitfloor is an example of that, yes I know folks have had good experiences but, when you dig into the situation deeply you see the same type of complaints generated and you see the same pattern that starts the criminal charges.  Notice how the actual exchanges with minimal complaints go down but, typically come back up quickly.  This is also why I and possibly others have tried amicably to work with Campbx and notice how the individal "Keyur @ Campbx" deals with people.  That public display of incompetence, laziness or whatever the problem is will draw the FinCEN like flies to shit.  There's no way to get around that unless Campbx and co. actually do the right thing.  A good example of totally doing the right thing but, in a strict way is Coinbase, yes they generated complaints however notice how they're customer service is EXTREMELY responsive.  Again they are strict though but, that strictness is to avoid being herded into the same shitbag as other companies that do these things.

Moral of the story, do the right thing and the people will be on your side which makes it literally difficult/next to impossible for the govt to mess with you.  Campbx is about to learn this lesson the real hard way which is probably what has to happen for them to realize you can't treat people's money and identification like toys.

[RodeoX]

I like https://www.tradehill.com/ . But as mentioned, no one is sure about the applicable laws yet.