Providers Of Prepaid Card

Regulations define Prepaid access as access to funds or the value of funds that have been paid in advance and can be retrieved or transferred at some point in the future through an electronic device or vehicle, such as a card, code, electronic serial number, mobile identification number or personal identification number..

Financial Crimes Enforcement Network (FinCen) regulations define certain non-bank providers and sellers of prepaid access as money services businesses (MSBs). Without effective controls and adequate compliance programs, providers of prepaid access and prepaid cards, especially open-loop cards with payment networks, can be unwitting participants in money laundering, terrorist financing, and various other criminal activities.

Because these prepaid cards are considered the same as bank accounts from Anti-money laundering/know-your-customer (AML/KYC) compliance standpoint, the same level of customer due diligence must be applied by providers to confirm the identity of their card customers.

Gilbert Reese specializes in implementing BSA/AML risk mitigation solutions that include:

• Conducting appropriate due diligence on any third-party service provider.
• Conducting a risk assessment of the prepaid access product itself including product features and how it is distributed and loaded.
• Implementing transaction monitoring program for unusual or suspicious activity.
• Product features and limits on usage.
• Customer Due Diligence (CDD).