Cash America 2012 Annual Report Download - page 46

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employee training program; and (4) an independent audit function to test the program. In addition, the U.S. Treasury
Department’s Office of Foreign Assets Control requires that assets and transactions involving target countries and their
nationals be frozen.
Under the Bank Secrecy Act and regulations of the U.S. Department of the Treasury, the Company must report
transactions occurring in a single day involving currency in an amount greater than $10,000 and also must retain records
for five years for purchases of monetary instruments for cash in amounts from $3,000 to $10,000. In addition, multiple
currency transactions must be treated as single transactions if the financial institution has knowledge that the
transactions are by, or on behalf of, any person or entity and result in either cash in or cash out totaling more than
$10,000 during any one day. In addition, federal regulations require the Company to report suspicious transactions
involving at least $2,000 in a single day to the Financial Crimes Enforcement Network of the Treasury Department
(“FinCEN”). The regulations generally describe three classes of reportable suspicious transactions—one or more related
transactions that the business knows, suspects, or has reason to suspect (1) involve funds derived from illegal activity or
are intended to hide or disguise such funds, (2) are designed to evade the requirements of the Bank Secrecy Act, or (3)
appear to serve no legitimate business or lawful purpose. Certain subsidiaries of the Company are registered as money
services businesses with the U.S. Treasury Department and must re-register with FinCEN at least every two years. The
Company must also maintain a list of names and addresses of, and other information about, the Company’s stores and
must make that list available to any requesting law enforcement agency. The store list must be updated at least annually.
Since October 2007, federal law caps the annual percentage rate that may be imposed on certain loans made to
active duty military personnel or to active members of the National Guard or on active Reserve Duty, as well as their
immediate dependents at 36%. This 36% annual percentage rate cap, which effectively prohibits the Company from
offering certain of its consumer loan products to active members of the military or their dependents, applies to a variety
of loan products, including certain consumer loans, though it does not apply to pawn loans.
The Federal Fair and Accurate Credit Transaction Act requires the Company to adopt written guidance and
procedures for detecting, preventing, and responding appropriately to mitigate, identity theft and to adopt various
coworker policies, procedures, and provide coworker training and materials, that address the importance of protecting
non-public personal information and aid the Company in detecting and responding to suspicious activity, including
suspicious activity that may suggest a possible identity theft red flag, as appropriate.
In addition, the Company is also subject to regulation by the Federal Trade Commission ("FTC") in the United
States. The FTC’s Bureau of Consumer Protection’s mandate is to work to protect consumers against unfair, deceptive,
or fraudulent practices in the marketplace. In furtherance of consumer protection, the FTC provides guidance and
enforces federal laws concerning truthful advertising and marketing practices; fair financial practices in lending, loan
servicing and debt collection; and protection of sensitive consumer information.
The Dodd-Frank Act created the CFPB, which has begun exercising supervisory review over certain non-bank
providers of consumer financial products and services, including providers of consumer loans such as the Company. For
more information about the CFPB, see “Recent Developments—Recent Regulatory and Other Developments—
Consumer Financial Protection Bureau” and “Item 1A. Risk Factors—Risks Related to the Company’s Business and
Industry—The Consumer Financial Protection Bureau could have a significant impact on the Company’s U.S.
consumer loan business.”
The failure to comply with any of the laws, rules or related regulations described in “—Other Regulations
Affecting Lending Operations” could result in, among other things, the issuance of cease and desist orders (which can
include orders for restitution or rescission of contracts, as well as other kinds of affirmative relief), the imposition of
fines or refunds, and other civil and/or criminal penalties, some of which could be significant in the case of knowing or
reckless violations.