MoneyGram 2010 Annual Report Download - page 12

Table of Contents
Recent Federal Legislation in the United States — The Dodd-Frank Act was signed into law on July 21, 2010. While the Dodd-Frank Act
will likely impose additional regulatory requirements upon us, it is difficult to gauge the impact on our business because many provisions
of the Dodd-Frank Act require the adoption of rules and further studies. The Dodd-Frank Act creates a new Bureau of Consumer
Financial Protection (the "Bureau"), which issues and enforces consumer protection initiatives governing financial products and services,
including money transfer services, in the United States. We will be required to provide enhanced disclosures to our money transfer
customers, which may require us to modify our systems. In addition, we may be held liable for the failure of our agents to comply with
the Dodd-Frank Act. The enhanced disclosure requirements and the extent of vicarious liability will be determined by rules to be issued
by the Bureau when it becomes operational on or about July 21, 2011.
Other — We sell our MoneyGram-branded prepaid card in the United States, in addition to loading prepaid cards of other card issuers
through our ExpressPayment system. Prepaid card services are generally subject to federal and state laws and regulations, including laws
related to consumer protection, licensing, escheat, anti-money laundering and the payment of wages. These laws are evolving, unclear
and sometimes inconsistent. The extent to which these laws are applicable to us is uncertain and we are currently unable to determine the
impact that any future clarification, changes or interpretation of these laws will have on our services.
Clearing and Cash Management Bank Relationships
Our business involves the movement of money. On average, we move over $1.0 billion daily to settle our payment instruments and make
related settlements with our agents and financial institutions. We generally receive a similar amount on a daily basis from our agents and
financial institutions in connection with our payment service obligations. We move money through a network of clearing and cash
management banks, and our relationships with these clearing banks and cash management banks are a critical component of our ability to
move funds on a global and timely basis.
We rely on two banks to clear our retail money orders. We currently have eight official check clearing banks. We believe these
relationships provide sufficient capacity for our money order and official check outsourcing services.
We maintain contractual relationships with a variety of domestic and international cash management banks for automated clearing house
("ACH") and wire transfer services for the movement of consumer funds and agent settlements. There are a limited number of
international cash management banks with a network large enough to manage cash settlements for our entire agent base. In addition,
some large international banks have opted not to bank money service businesses. As a result, we also utilize regional or country-based
banking partners in addition to large cash management banks.
Intellectual Property
The MoneyGram brand is important to our business. We have registered our MoneyGram trademark in the United States and a majority
of the other countries where we do business. We maintain a portfolio of other trademarks that are also important to our business,
including our ExpressPayment, globe with arrows logo, MoneyGram Rewards, The Power is in Your Hands®, The Power to Change the
Way You Send Money®, FormFree and AgentConnect marks. In addition, we maintain a portfolio of MoneyGram branded domain
names.
We rely on a combination of patent, trademark and copyright laws, and trade secret protection and confidentiality or license agreements
to protect our proprietary rights in products, services, know-how and information. We believe the intellectual property rights in
processing equipment, computer systems, software and business processes held by us and our subsidiaries provide us with a competitive
advantage. We believe we take appropriate measures to protect our intellectual property to the extent such intellectual property can be
protected.
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