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Author Topic: Is becoming a Western Union Agent a fast track to USA Compliance?  (Read 3834 times)
ibitbuys
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July 29, 2014, 02:14:57 PM
 #1

WU is the biggest money transmitter in the world.

So just by being an agent you share their 'license' to transmit money around the world and receive.

Does anyone know if this satisfies the US Fed rule to be a licensed money transmitter? WU sales material states,

https://www.wu.com/AL/en/faq-become-agent.html

Do I need to have a specific licence and will I be regulated?

Yes, but Western Union will handle this for you.

So technically if you have a business and register with WU as an agent, you fall under their license and should not have to register again to satisfy bs Fed rules.

WU is the established money/wire transmitter around the world, so if you offer as part of a business exchange services, you should be able to take and send money for btc as a licensed agent of WU.

Anyone seeing my point here?

Sure WU is expensive but once you are in the umbrella protection as an 'agent', you can then take checks and money and whatever for btc, and guess what you are an AGENT of the biggest money transmitter in the world.

So WU agent status makes an agent a defacto money transmitter.

IMO

Anyone else seeing this the same way.

I can see WU getting 100K new agents if this is the answer to all the bs regulations going on, you put that WU agent number on your site and you are 100% legit to the feds.

Bitcoin is just a new currency, you can take any type of currency you want around the world as a WU agent, take and receive in USD, GBP, Euro, Yen, whatever right.

So just join WU and be part of the largest network of money transmitters around, then a client can choose, wire me money, send a check, go to WU or send me gold bullion or I'm here bring your cash.

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July 29, 2014, 02:33:58 PM
 #2

I'm really struggling to see your point here. Can you do a condensed tl;dr version?

ibitbuys
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July 29, 2014, 03:11:31 PM
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Lot's of people worried about new regulations for bitcoin, the CRS report calls it a currency.

Fed judges say it is property due to value.

Fed auction legitimized it.

Around a year ago the feds redefined stuff I their code so bitcoin now falls under money transmitter license rules.

So it's regulate already if you are transmitting it over the net or wu or bank wires. Only face to face local deals are probably exempt now.

So if you are inside the USA or want to do biz with people in the USA you need to comply to the money transmitter rules.

So being a WU agent may be the fast track, the alternative, apply for a state level money transmitter license, pay a huge surety bond and then also get a fed license.

The alternative, just grab a WU agent license, then their umbrella license covers you under the fed rules IMO.

So if anyone else is looking into complying to US fed money transmitter rules, which anyone who transmit btc via the internet for anything of value may in fact be under now if you use a broad sweep of the fed rules on money transmitters, they literally have the law now so any business using the net to transmit anything of value for currency or wires or any thing of value is a money transmitter, that's how broad the new fed definition is if you actually read it and discuss it with judges which I have done, discussed it with lawyers and judges I know and they all say the new fed law from last year is TOO OVER SWEEPING, ebay is now a money transmitter and everyone on it is too in some opinions.

So that new rule basically puts the net and anyone inside the usa as a money transmitter now, sure they're saying that's not the 'intent' of the law, if you sell stuff merchants aren't transmitters, NO READ THE LAW they can choose to prosecute who they want now that does any type of business on the Net since the Net is now considered an electronic wire like a bank wire is.

So we have a messed up Fed rule now that can be used according to lawyers and judges to classify any internet 'transaction' as a money transmission, that's the overview of the new law from a year ago, so the US gov can target anyone doing internet transactions now IF THEY WANT, they haven't, but if you do biz in the USA and use the net as ecommerce, you might want to think about acquiring a money transmitter license just to protect yourself.

Now in the micro picture of bitcoin, if you take anything of value even face to face, well you still are using an electronic wire to move btc, so even face to face deals can now be under the new rule, but some thing it's the receipt of something first that triggers it, others say the new rule is both send/receive, so any bitcoin transaction is technically under the new fed law for money transmitters.

The exemptions are accounts inside regulated banks etc.

Otherwise the law would apply to even bank transactions in and out.

Banks and account holders of regulated banks seem to be the only clearly exempted things in the new law.

Until the feds step up and file a complaint on someone using say ebay and paypal for money transmissions the media and people don't realize how BROAD the new law is, that's why lawyers and judges are discussing it now as potential complaints that big brother can bring IF THEY WANT.

So have a money transmitter license or being an agent of a money transmitter service like WU may be the only way to protect yourself and a company from the over reach of the new law the feds have in place.

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July 29, 2014, 03:16:42 PM
 #4

No because your licensed with WU is only for licensed activity and that doesn't include the exchange of virtual currency.   FinCEN isn't saying that Bitcoin exchangers might ALSO be using money transmission they are saying that the very act of exchanging virtual currency for real currency is money transmission.  Even a face to face transaction involving the exchange of virtual currency is considered money transmission under federal law.

If your agent agreement doesn't cover the exchange of virtual currency (which it doesn't) and you engage in it then you are engaging in activity outside the scope of your agreement.

As for your claim that anything involving virtual currencies is money transmission that is completely false.  All the information is publicly available so why not .... READ IT.
http://www.fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html
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July 29, 2014, 03:58:36 PM
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That's not the Code it's 'guidance', the law is pretty simple all money transmitters (which WU is) must be licensed, so the legal question/argument is, does having an agents license of the worlds #1 Money Transmitter cover you?

Facts

48 States have money transmitter rules and if you are a WU agent, you should be compliant, since they hold the master license which WU then fraction into agent agreements.

So as an 'agent' of WU you are a defacto licensed money transmitter under their agent license which is pretty much global in nature.

Now the definition of 'currency' or things of 'value' are in the new fed definition of money transmitters, so any licensed money transmitters and their agents are covered. If a business then gets a 2nd money transmitter license, why would they when their agency agreement complies?

I'm not offering 'legal advice', I'm welcoming legal discourse on IF a WU license can be viewed as compliance.

IMO it does comply, since as an agent you have to agree to the general terms of service of WU which is compliant with money laundering rules and various transaction record keeping rules.

FACT

A WU agent is under the umbrella money transmitter global licenses of WU as a LICENSED MONEY TRANSMITTER AGENT of WU, so that license is not just for US Currency it applies to global currencies and right now the CRS report to congress is saying Bitcoin is a new global currency, it's not traditional fiat currency but it is a new type of currency, so the argument is any currency is exchangeable via WU transfers, a person wherever can transfer to a WU whatever currency they want to be received by the agent who then converts into the currency the receiver wants, so when the 'WU agent' is the company/person/business receiving or sending whatever, they are doing it under a WU license to transmit 'money' and virtual currency is now technically considered 'money' or something of value, so that's why a money transmitter license is needed and when a business wherever obtains an agent right with WU then WU has the license to allow 'money' transmission.

I don't see anything in the actual code stating a business would need to double license a business just to take a virtual currency since all things of value is the new definition so WU agents are licensed agents under the WU master money transmitter license in whatever jurisdiction WU operates in which is pretty much most of the world.

Now if the new codes say you can't use an established money transmitter license to do virtual currency, then a double license would be needed. For example when a business takes WU they need to usually show some type of ID to receive it to the agent, granted minor amounts in some jurisdictions can do so-called password only receipt and no ID, but WU has in place already operational rules that severely limit such transactions.

So from the discussions I've had with lawyers and even judges on this issue is, bitcoin is currency and you need a money transmitter license, so the issue is now does a WU agent license establish compliance? Unless the code says WU is not for virtual currency, you need a different license, then ok, but the rules are saying you need to get a money transmitter license in your area at least and a WU agent license is a money transmitter license, so it should be compliance.

A judge would look at the CODE not the guidance, since precedent is how judges view laws/codes, any cases where WU is considered to not be a money transmitter license? No, so WU and its agents by precedence is a defacto 'money transmitter' so all agents are defacto money transmitters until a judge rules they are not, then that ruling is precedence in that courts jurisdiction. Since district federal courts often come to different conclusions of LAW based upon COURT PRECENDENTS and not some bs guidance opinion, the LAW or JUDGES will eventually be deciding what THE LAW/CODE means, and the code is clear, money transmitter license is required and agents of WU have a valid money transmitter license as a legal agent of WU.

So if you are say in the 3rd Federal District region such as FL and GA, you get involved in a legal proceeding, the judge looks at the LAW/CODE and says ok this business has a duty to be a LICENSED MONEY TRANSMITTER where's your license, they say ask WU I'm an AGENT of their money transmitter license, the judge can look at previous case law and make a ruling, if the judge does what they call bench legislation, where he/she decides a WU agent is not a money transmitter, then the whole WU concept is destroyed.

Or the judge can rule, well the law involves currency and bitcoin is not currency, yet by definition of LAW/CODE anything of value is not subject to money transmitter license so it is technically now currency, just not traditional currency that a government regulates, but the act of having a right to transmit 'currency' by WU does in some legal opinions of lawyers and judges I've spoken to seem to comply.

So a money transmitter license is a right to transmit things of value now as defined by the code/law so an agents right under a master money transmitter license which at this point WU may in fact be a legal right to transmit all currencies or things of value as money is now defined in the CODE/LAW.

So an agents defense is look court I'm an agent of WU and that is the licensed money transmitter license involved so I am compliant.

If a court/judge says no, then that's precedence in their district and they have 13 districts of federal courts and a more sub districts and special districts as well.

So a money transmitter license whether in the name of the business or in the name of the master license holder in this case WU should be in the eyes of the courts/judges a legal right to do any type of 'money' transmission.

The point is in the USA the Feds want businesses LICENSED and WU and its agents are LICENSED MONEY TRANSMITTERS.

The fact is the Feds have put all things of value now as 'money' or currency in the new definition so a WU license is compliance now in the eyes of some lawyers and judges.

Are you a lawyer?

Have you discussed with a lawyer or a judge if a WU agent is not allowed to do transactions that as a side part of the transaction involve bitcoin?

I don't see a new fed law for money transmitters they are using the one already in place and just expanding what they define as money or a thing of value, so by LAW/CODE bitcoin is now something licensed money transmitters already licensed can use to convert whatever came across the wire.

If someone wants bitcoin they can wire you WU money, instead of giving that person traditional currency you just give them bitcoin, something of value and that's why money transmitter licenses are required and as such WU agents should be able to exchange what they receive for anything of value that is legal.





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July 29, 2014, 04:37:34 PM
 #6

I would consult with a lawyer to be honest, if I was going to try to get US compliance for doing something with Bitcoin.  Unfortunately I think because BTC is relatively new it could cost a little more than normal because it's not obvious what the answer is, so the lawyer will have to do some research.  Eventually all this stuff will be available on the internet I think but for now it's a bit of some educated guesswork I think.
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July 29, 2014, 04:48:31 PM
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I posted another thread asking any 'lawyers' in the community to chime into this thread, I think the whole community would benefit as it being a general discussion thread and not isolated to the backwaters of a 'legal' section.

So I hope they don't move this to legal, since any bitcoin user/business should be interested in the general nature of the topic as a whole.

So maybe some lawyers form 'legal' area may chime in, if any lawyers are part of the community, but the topic IMO is of great general interest to the btc community as a whole.

If enough lawyers say YES, if you get an agency right with WU, you are a defacto money transmitter, it could be the fast track to general compliance.

However, a US AG may view it different, but if lawyers and judges look at the code/law and say WU is a money transmitter and there's nothing in the code/law to say its agents are not money transmitters, it may be a simple WU agent right satisfies compliance.

First a business taking a lot in with WU benefits by being an agent as to cost.

Second, WU is a licensed money transmitter in the eyes of the courts, and through long standing court precedence as to agency agreements and master license rights of 'agents' such WU agents should have a valid right to transmit and receive anything of value under the long standing court opinions on 'agency' since anything of value is now the definition of 'money' and why businesses need to be licensed money transmitters, and WU agents are licensed money transmitters through their agent agreements with WU.

Here's an example of a State saying WU is a licensed money transmitter in that state (UT in link).

So WU is a money transmitter, so its agents are acting under their money transmitter license, so that's the legal argument and thus far lawyers and judges I've discussed it with agree, WU agents are money transmitters so no extra license required they have a money transmitters license to well founded agency law precedence.

http://www.dfi.state.ut.us/MonTrans.htm

Another view on how WU is THE MONEY TRANSMITTER MODEL, so its agents are defacto money transmitters. WU is the epitome of what a money transmitter is.

http://www.regblog.org/2013/06/a-call-to-clarify-the-regulatory-scope-of-money-transmitter-laws.html

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July 29, 2014, 05:13:54 PM
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The license WU issues to agents doesn't cover the exchange of virtual currency.  Sure if WU licensed you to exchange virtual currency as their agent then yes you would be "good to go'.  Their license does not however (I and legal counsel have seen a copy).  The federal law is clear on agents engaged in activity outside that which is licensed by the parent MSB.

Quote
Solely because that person serves as an agent of another MSB - A person that is an MSB solely because that person serves as an agent of another MSB is not required to register. However, a person that is an MSB both because it engages in MSB activities on its own behalf and as an agent of another MSB must register.

Example: A supermarket corporation that acts as an agent (as a seller of money orders) for an issuer of money orders, and performs no other services of a nature and amount that would cause the supermarket corporation to be a money services business, is not required to register. The result is the same if the supermarket corporation serves as an agent for two or more MSBs. Thus, if the supermarket corporation serves as an agent both of a money order issuer and of a money transmitter, it is not required to register. However, registration is required if the supermarket corporation --in addition to acting as an agent of a money order issuer --cashed checks or exchanged currency (other than as an agent for another MSB) in an amount greater than $1,000 for any person on any day in one or more transactions.Solely because that person serves as an agent of another MSB - A person that is an MSB solely because that person serves as an agent of another MSB is not required to register. However, a person that is an MSB both because it engages in MSB activities on its own behalf and as an agent of another MSB must register.

Example: A supermarket corporation that acts as an agent (as a seller of money orders) for an issuer of money orders, and performs no other services of a nature and amount that would cause the supermarket corporation to be a money services business, is not required to register. The result is the same if the supermarket corporation serves as an agent for two or more MSBs. Thus, if the supermarket corporation serves as an agent both of a money order issuer and of a money transmitter, it is not required to register. However, registration is required if the supermarket corporation --in addition to acting as an agent of a money order issuer --cashed checks or exchanged currency (other than as an agent for another MSB) in an amount greater than $1,000 for any person on any day in one or more transactions.

The license WU provides agents is very specific.  It clearly defines what business activity is covered and what steps needs to be taken.  It isn't some blanket do whatever you want license.  Any MSB activity outside the license from WU would be no different than if you had no WU license at all. Still it is easy to confirm this yourself.  Call up WU agent number and advise them you would like to become an agent and as a WU agent exchange virtual currency for real currency.  Post back with what you find out.

Someday however WU "may" get into the business of buying and selling virtual currency and if/when they do the agents license would cover that as well.
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July 29, 2014, 06:11:24 PM
 #9

If anyone has a copy of their contract or a link to, please post, seems no links exist right now to a sample of their agent contract.

You read it, ok, can you provide a copy of it?

We're trying to get a copy now.

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July 30, 2014, 01:04:18 AM
 #10

WU is the biggest money transmitter in the world.

So just by being an agent you share their 'license' to transmit money around the world and receive.

Does anyone know if this satisfies the US Fed rule to be a licensed money transmitter? WU sales material states,

https://www.wu.com/AL/en/faq-become-agent.html

Do I need to have a specific licence and will I be regulated?

Yes, but Western Union will handle this for you.

So technically if you have a business and register with WU as an agent, you fall under their license and should not have to register again to satisfy bs Fed rules.

WU is the established money/wire transmitter around the world, so if you offer as part of a business exchange services, you should be able to take and send money for btc as a licensed agent of WU.

Anyone seeing my point here?

Sure WU is expensive but once you are in the umbrella protection as an 'agent', you can then take checks and money and whatever for btc, and guess what you are an AGENT of the biggest money transmitter in the world.

So WU agent status makes an agent a defacto money transmitter.

IMO

Anyone else seeing this the same way.

I can see WU getting 100K new agents if this is the answer to all the bs regulations going on, you put that WU agent number on your site and you are 100% legit to the feds.

Bitcoin is just a new currency, you can take any type of currency you want around the world as a WU agent, take and receive in USD, GBP, Euro, Yen, whatever right.

So just join WU and be part of the largest network of money transmitters around, then a client can choose, wire me money, send a check, go to WU or send me gold bullion or I'm here bring your cash.



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July 31, 2014, 11:24:12 PM
 #11

I would consult with a lawyer to be honest, if I was going to try to get US compliance for doing something with Bitcoin.  Unfortunately I think because BTC is relatively new it could cost a little more than normal because it's not obvious what the answer is, so the lawyer will have to do some research.  Eventually all this stuff will be available on the internet I think but for now it's a bit of some educated guesswork I think.
This is probably the best advice on this thread. Federal AML laws are very complicated, and case law can make them even more complicated. By meeting with a lawyer who is legally required to act in your best interest, you should be able to receive sound legal advice.

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August 01, 2014, 03:49:50 AM
 #12

I would consult with a lawyer to be honest, if I was going to try to get US compliance for doing something with Bitcoin.  Unfortunately I think because BTC is relatively new it could cost a little more than normal because it's not obvious what the answer is, so the lawyer will have to do some research.  Eventually all this stuff will be available on the internet I think but for now it's a bit of some educated guesswork I think.
This is probably the best advice on this thread. Federal AML laws are very complicated, and case law can make them even more complicated. By meeting with a lawyer who is legally required to act in your best interest, you should be able to receive sound legal advice.

Gonna cost you a couple of mil USD to do what you want to do.

Find something else.

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