Quote from: greyhawk on June 11, 2013, 11:47:04 AM

I can't tell if you're sublimely sarcastic or just didn't read the thread.

TOS can't violate existing laws. For example I can't put in a TOS by using the service you agree to transfer all property to xyz corp and then go into court and say "see he agreed give me the deed to his house". A company can refuse to do business but they can't refuse to do business and "hang on to" another persons assets. The honest and clear thing to do would be for the service provider to have client complete any requirements first and then accept funds. For example if the service provider is worried about ACH fraud they could send a random small amount of funds to the clients account to verify it. If they need any docs they can design the site such that the client can't send funds until verified.

Nothing in MSB regulations requires or even allows a company to just keep client funds. The purpose of AML is to prevent the TRANSFER of suspicious funds not to deprive criminals of them (note not saying the OP is a criminal just pointing out the purpose of AML programs is to prevent not seize). Seizure of assets is a law enforcement activity pursuant to a warrant by a judge. The company has no authority to seize funds of clients under any circumstances. If funds are returned then there is no transfer. In the event of a "suspicious transaction" the proper procedure is to file a SAR with FinCEN. If the company had completed mandatory AML training and had a written AML compliance program as required by a MSB they would already know the proper response. Companies doing stupid shit like seizing the property of another person is why money transmission is so heavily regulated at the state level. State regulation and licensing has nothing to do with AML, it is about protecting clients from illegal actions of companies. Illegal actions like seizing without due process the property of another person.

I mean you are a logical person, obviously if was the case that a company could just keep funds based on vague terms of service it would be a good way to turn a profit doing nothing. Sorry before we can complete this transactions we need a copy of your DL ... now we also need a copy of your utility bill ... sorry we also need three personal references ... sorry we need your SSN and written permission to access your credit report .... sorry we also need a notarized copy of your high school diploma ... what you are refusing to comply well we will just keep these funds then.

http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&SID=017335056cf96e754794b9fe7336e17c&rgn=div5&view=text&node=31:3.1.6.1.6&idno=31#31:3.1.6.1.6.3.5.8

Quote

Every money services business described in § 1010.100(ff)(1), (3), (4), (5), (6), and (7) of this chapter, shall file with the Treasury Department, to the extent and in the manner required by this section, a report of any suspicious transaction relevant to a possible violation of law or regulation. Any money services business may also file with the Treasury Department, by using the form specified in paragraph (b)(1) of this section, or otherwise, a report of any suspicious transaction that it believes is relevant to the possible violation of any law or regulation but whose reporting is not required by this section.

(2) A transaction requires reporting under the terms of this section if it is conducted or attempted by, at, or through a money services business, involves or aggregates funds or other assets of at least $2,000 (except as provided in paragraph (a)(3) of this section), and the money services business knows, suspects, or has reason to suspect that the transaction (or a pattern of transactions of which the transaction is a part):

(i) Involves funds derived from illegal activity or is intended or conducted in order to hide or disguise funds or assets derived from illegal activity (including, without limitation, the ownership, nature, source, location, or control of such funds or assets) as part of a plan to violate or evade any Federal law or regulation or to avoid any transaction reporting requirement under Federal law or regulation;

(ii) Is designed, whether through structuring or other means, to evade any requirements of this chapter or of any other regulations promulgated under the Bank Secrecy Act; or

(iii) Serves no business or apparent lawful purpose, and the reporting money services business knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction.

(iv) Involves use of the money services business to facilitate criminal activity.