Banking Risks

Banks consider Money Services Businesses to be of higher risk for potential money laundering and terrorist financing transaction activities. The various risks to the bank fall within the following categories:

  • Regulatory and Legal Risks
  • Credit
  • Operational
  • Reputational

Banks actively monitor transactions to better know and understand their customers and thereby identify and report suspicious transaction activity. For MSBs, the bank also needs to understand the business activities performed, confirm that the MSB has met all registration and licensing requirements and assure itself that the MSBs policies and procedures are sufficient to make it an acceptable risk to the bank. Sometimes the bank will determine that activities are suspicious and file a SAR on its MSB customers. See the sub-menu topics for more information.