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MoFo Reenforcement The Enforcement Blog

Is Payroll Processing Money Transmission? New York May Be Weighing In

Posted in Electronic Payments, Regulatory Developments, State Regulators

It seems like a natural progression for a company that provides any sort of payments-related information processing to migrate from handling data about payments to seeking to handle the payments themselves. But it can be a challenge for any company, particularly a younger one, to determine whether a payments-related service it wishes to offer — even if it is only part of a larger suite of services — is subject to regulation as money transmission. This question is important because nearly every state regulates money transmission under its own state-specific licensing framework, and the statutory definitions of money transmission can be construed broadly to cover any entity that “receives” or “transfers” money.

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