MoneyGram 2009 Annual Report Download - page 9

Table of Contents
federal and state anti-money laundering laws and regulations; money transfer and payment instrument licensing laws; escheatment laws;
privacy laws; data protection and information security laws; and consumer disclosure and consumer protection laws. Failure to comply
with any applicable laws and regulations could result in restrictions on our ability to provide our products and services, as well as the
potential imposition of civil fines and possibly criminal penalties. See "Risk Factors" for additional discussion regarding potential
impacts of failure to comply. We continually monitor and enhance our global compliance program to stay current with the most recent
legal and regulatory changes. During 2009, we increased our compliance personnel headcount and made investments in our compliance-
related technology and infrastructure.
Anti-Money Laundering Compliance. Our money transfer services are subject to anti-money laundering laws and regulations of the
United States, including the Bank Secrecy Act, as amended by the USA PATRIOT Act, as well as the anti-money laundering laws and
regulations in many of the countries in which we operate, particularly in the European Union. Countries in which we operate may require
one or more of the following:
• reporting of large cash transactions and suspicious activity;
• screening of transactions against the government's watch-lists, including but not limited to, the watch list maintained by the United
States Treasury Department's Office of Foreign Assets Control ("OFAC");
• prohibition of transactions in, to or from certain countries, governments, individuals and entities;
• limitations on amounts that may be transferred by a consumer or from a jurisdiction at any one time or over specified periods of
time, which require the aggregation of information over multiple transactions;
• consumer information gathering and reporting requirements;
• consumer disclosure requirements, including language requirements and foreign currency restrictions;
• notification requirements as to the identity of contracting agents, governmental approval of contracting agents or requirements and
limitations on contract terms with our agents;
• registration or licensing of the Company or our agents with a state or federal agency in the United States or with the central bank or
other proper authority in a foreign country; and
• minimum capital or capital adequacy requirements.
Anti-money laundering regulations are constantly evolving and vary from country to country. We continuously monitor our compliance
with anti-money laundering regulations and implement policies and procedures to make our business practices flexible, so we can comply
with the most current legal requirements.
We offer our money transfer services through third-party agents with whom we contract and do not directly control. As a money services
business, the Company and its agents are required to establish anti-money laundering compliance programs that include: (i) internal
policies and controls; (ii) designation of a compliance officer; (iii) ongoing employee training and (iv) an independent review function.
We have developed an anti-money laundering training manual available in multiple languages and a program to assist with the education
of our agents on the various rules and regulations. We also offer in-person and online training as part of our agent compliance training
program and engage in various agent oversight activities.
Money Transfer and Payment Instrument Licensing. The majority of United States states, the District of Columbia, Puerto Rico and the
United States Virgin Islands and Guam require us to be licensed to conduct business within their jurisdictions. In November 2009, our
primary overseas operating subsidiary, MoneyGram International Ltd, became a licensed payment institution under the European Union
Payment Services Directive. Licensing requirements generally include minimum net worth, provision of surety bonds, compliance with
operational procedures, agent oversight and the maintenance of reserves or "permissible investments" in an amount equivalent to
outstanding payment obligations, as defined by our various regulators. The types of securities that are considered "permissible
investments" vary from state to state, but generally include cash and cash equivalents, United States government securities and other
highly rated debt instruments. Most states and our other regulators require us to file reports on a quarterly or more frequent basis to verify
our compliance with their
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