Montana is the only state in the US that does not have a specific money transmitter license. However, this does not mean that money transmitters do not need any licenses in Montana. In fact, the Montana Division of Banking and Financial Institutions (Division) has stated that money transmitters may need to obtain other types of licenses in order to operate in the state, depending on the specific activities they are engaged in.
For example, a money transmitter that offers escrow services would need to obtain an escrow license. A money transmitter that offers consumer loans would need to obtain a consumer finance company license. And a money transmitter that offers retail sales financing would need to obtain a retail sales finance company license.
The Division has also stated that money transmitters may need to register with the Financial Crimes Enforcement Network (FinCEN) as a money services business (MSB).
The official definition of a money transmitter in Montana is not defined in state law. However, the Division uses the FinCEN definition of an MSB, which is “any person doing business in one or more of the following activities: exchanging currency; transferring funds; or issuing payment instruments.”
The following are some examples of activities that would be considered money transmission in Montana:
- Selling or redeeming traveler’s checks or money orders
- Issuing or selling stored-value cards
- Transmitting money through a wire transfer service
- Exchanging virtual currency for fiat currency
If you are unsure whether your business activities require a license in Montana, you should consult with an attorney.
How to operate in the state of Montana without a money transmitter license
If you are a money transmitter and you do not need to obtain a specific license in Montana, you can still operate in the state by registering with FinCEN as an MSB.
To register with FinCEN, you must complete and submit a Form FinCEN-114, Report of Foreign Bank and Financial Accounts (FBAR). You can register online at the FinCEN website.
Once you are registered with FinCEN, you will need to file an annual report, Form FinCEN-114a, Report of Foreign Bank and Financial Accounts (FBAR).
Conclusion
Montana is unique in the United States for not requiring a specific money transmitter license. However, based on their activities, money transmitters in Montana might need to secure other forms of licensing. Additionally, they are required to register with the Financial Crimes Enforcement Network (FinCEN) as a Money Services Business (MSB). If you’re uncertain about the licensing needs for your business in Montana, it’s advisable to consult with an attorney.
The following are some legal sources in the state of Montana that you may need to know about if you are a money transmitter:
- Montana Banking and Financial Institutions Act: This law contains the general provisions governing the Division of Banking and Financial Institutions, including the Division’s authority to license and regulate money transmitters.
- Montana Consumer Finance Act: This law contains the specific provisions governing consumer finance companies, including licensing requirements.
- Montana Retail Sales Finance Act: This law contains the specific provisions governing retail sales finance companies, including licensing requirements.
- Montana Escrow Act: This law contains the specific provisions governing escrow companies, including licensing requirements.
- FinCEN Regulations: FinCEN has issued a number of regulations that apply to MSBs, including regulations on anti-money laundering and counter-terrorism financing.
You can find these legal sources on the websites of the Montana Division of Banking and Financial Institutions and the Financial Crimes Enforcement Network.
In addition to the above legal sources, you may also want to consult with an attorney to discuss your specific situation and to ensure that you are in compliance with all applicable laws and regulations.
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This page was last updated on February 26, 2024.
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