What Happens if You Do Money Transfer Transactions Without A License?
When you do multiple money transfer transactions without a license, you are not only breaking the law! You’ve already broken the law. If you knowingly do this as a financial intermediary, and you have exceeded the limits as imposed for non-professional vs professional (licensed) transfers, this is something serious to condier.
Many-a-times a would-be customer would call us and explain how they now need a money transfer license (a money transmitter license in the United States), as their volumes are now growing significantly and they need to get every thing “legit“.
Please remember, we record ALL our calls. No exceptions. When you contact us and tell us this, you are essentially admitting to running an unlicensed money transfer service. We also do not delete our call recordings.
Depending on where you are. The penalty for doing this, could be a simple slap on the wrist and saying “Don’t do this again!” or it could be something as severe as a fine and a jail sentence.
The United States is one of the most unforgiving markets for a couple of reasons. Firstly, there is no statute of limitations as to when or how long back you were doing this. You can’t get away with it, if, for example, the incident took place 9 years ago. If a career minded, aggressive law enforcement officer wanted to make an example out of you, they, along with the prosecuting attorney general would make sure that you are positioned as someone who is doing money laundering, terrorism financing, money used for illicit purposes, etc. and your seemingly innocent project lands you in deep trouble.
Secondly, just because you are outside the United States, also does not absolve you. You could be operating out of Nigeria, Kenya, Bangladesh, or Philippines, etc. However, in the eyes of the United States, if you signed up an American customer or delivered funds to an American customer, you would be treated no different as if you were an MSB (Money Services Business) and one that is present inside the United States, hence requiring Money Transmitter Licenses from all the states you are doing business in (Ref: Foreign Located Money Services Businesses)
So, what does this mean when you call us and tell us, you’ve been operating as an unlicensed money transfer operator?
Well, it’s complicated. Seriously, we would NOT like to know about it. You can however, hop on a call and discuss this case as a ‘hypothetical‘ scenario, where if, something like this were to take place, how can we help out?
Would we report this to LEAs (Law Enforcement Agencies)? It depends. We will have to consult with our legal to see. However, please do not incriminate yourself on a telephone call &/or email &/or a form submitted through our website.
Please either seek legal advice &/or legal counsel if you have indicated to us that you are/were running an unlicensed money transfer operation.
This page was last updated on January 4, 2020.