Florida’s New Corporate Check Cashing Regulations: What MSBs Need to Know About Record-Keeping Compliance

In recent years, Florida has implemented significant changes to its regulations governing corporate check cashing, particularly concerning record-keeping requirements for Money Services Businesses (MSBs). These updates aim to enhance transparency, prevent fraudulent activities, and ensure compliance with both state and federal laws.

Key Regulatory Changes

The Florida Office of Financial Regulation has amended Rule 69V-560.704, which outlines the records that check cashers must maintain. Effective March 7, 2024, the rule mandates that check cashers create and maintain a customer file for each entity listed as the payee on corporate payment instruments accepted by the licensee. Each customer file must include, at a minimum, the following information:

1. Documentation from the Secretary of State verifying registration as a corporation or fictitious entity showing the listed officers and FEID registration number. If a sole proprietor uses a fictitious name or is a natural person, then the customer file shall include the social security number of the business owner and documentation of the fictitious name filing with the Secretary of State.
2. Articles of Incorporation or other such documentation which establishes a legal entity in whatever form authorized by law. For purposes of this rule, a sole proprietor operating under a fictitious name registered with the Secretary of State shall not have to present such documentation.
3. Documentation of the business license/occupational license, business tax receipt, or its equivalent from the county where the entity is located.
4. A copy of the search results screen page from the Compliance Proof of Coverage Query Page on the Florida Department of Financial Services – Division of Workers’ Compensation website.
5. If the entity has an active workers’ compensation policy, the licensee must also maintain a copy of the policy declaration page or other document provided by the insurer indicating the payroll amount. For purposes of this rule, payroll may also be identified in the workers’ compensation policy as “annual remuneration.”
6. Documentation of individuals authorized to negotiate payment instruments on the corporation or fictitious entity’s behalf, including corporate resolutions. Payment instruments for insurance claims where there are multiple payees shall be exempt from this provision, provided that the maker of the check is an insurance company and the licensee has obtained and retained documentation as to the identity of the natural person listed as a payee on such payment instrument. For purposes of this rule, the term “individuals authorized” is limited to an officer of the corporate payee named on the instrument’s face.
7. A written corporate customer profile which includes: The full legal name of each beneficial owner, as defined in 31 C.F.R. s. 1010.230(d).
8.  An explanation of the customer’s business model.
9.  Type(s) of services offered.
10.  A written statement signed by the authorized officer of the corporate customer stating under what circumstances the corporate customer is not required or is exempt from obtaining a workers’ compensation policy, if there is no active workers’ compensation policy.

Additionally, all check cashers are required to review and update all active customer files at least every twelve months. The required review and update shall be attested to by the compliance officer or their designee, and such documentation shall be maintained within each customer’s file. For purposes of this rule, it shall not be necessary to update dormant customer files. Should a customer previously identified as being dormant resume transacting business with the licensee, the customer file information shall be updated before accepting any payment instrument.

Implications for MSBs

Compliance with these enhanced record-keeping requirements is crucial for MSBs to avoid penalties and maintain their licenses. The detailed documentation helps regulators monitor transactions effectively and deters illicit activities such as money laundering.

How ComplyCheck Can Assist

Navigating these regulatory changes can be challenging. ComplyCheck offers comprehensive solutions to help MSBs adhere to Florida's updated regulations:

• Automated Record Management: Our platform securely stores copies of all required documentation, ensuring easy retrieval during audits.
• Customer File Maintenance: ComplyCheck assists in creating and managing detailed customer files for entities cashing corporate checks, including necessary documentation like corporate registrations and business licenses.
• Compliance Monitoring: We provide tools to monitor transactions in real-time, ensuring that all record-keeping requirements are met and alerting you to any discrepancies.

By leveraging ComplyCheck's services, MSBs can stay compliant with Florida's evolving regulatory landscape, minimize the risk of non-compliance, and focus on serving their customers effectively.

Staying informed and adapting to regulatory changes is essential for the success and legality of your business. Let ComplyCheck be your partner in compliance, providing the expertise and tools necessary to navigate these complexities with confidence

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