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The Financial Crimes Enforcement Network explains specific exemptions for money transporters from anti-money laundering requirements in a recent administrative ruling, No. FIN-2014-R010.

The ruling addresses 2011 rule revisions that replaced previous regulatory interpretations issued to currency transporters with a new regulation that, among other things, revised the definition of "money transmission" to clearly exclude activity associated with the traditional currency transporter business model.

To summarize, FinCEN says a transporter of money or value is exempt from AML requirements when:

• a Federal Reserve Bank or federally regulated financial institution contracts for and directs the physical transportation of currency (or other value that substitutes for currency) by the transporter;
• the transporter, without intervention by any third party, picks up value from a person (or shipper acting at that person's direction) and physically delivers the same currency (or value) to the same person at another location or account at a BSA-regulated institution.

Generally, it says AML exemptions apply only when the transporter has no more than a custodial interest in the currency (or other value that substitutes for currency). Where the financial institution is the transporter, FinCEN "will consider the transportation to be a part of the FI's activities, and will consider the FI to be primarily responsible for AML compliance" for that activity.