4 ms·

Why can't a (possibly new) armored car company offer that service? Strictly speaking, they wouldn't be in the business of settling accounts at banks. They woul

Why can't a (possibly new) armored car company offer that service? Strictly speaking, they wouldn't be in the business of settling accounts at banks. They would be in the business of selling securities for cash. I could drive around in a car and provide the same service, only I'd want the security of an armored car to transport the cash. I would drive the cash to the bank and deposit it in my perfectly legitimate business account. One thing I don't understand: what kind of securities would these be? They would have to be sold on the spot, yet somehow more secure than cash.

gloverkcn 13y ago
When someone hands you cash and you are giving them something not a product/service (i.e. can't be a monetary instrument or a promise of in anyway providing the money back to the customer) then you are acting as a bank. So a new company can offer the service, but the aren't an armored car company they are a banking company and are required to get a banking charter. You can try create services that somehow skate the line (which is what all of the check cashing, payday advance, and title loan companies do, but they are classified as MSBs), but an AG (Attorney General) in any state where you are operating can come after you. The feds will also come after you if they think you are illegally taking deposits which can involve criminal charges.
- rahimnathwani 13y ago
  FWIW, in the UK: - There is an important difference between MSBs and banks: banks can take deposits. - Loan companies (e.g. payday advance, as you mention) are different: they need a Consumer Credit Licence and are regulated by the OFT/FCA. To your main point: I don't understand how (even in the US) my accepting cash in exchange for 'not a product/service' would mean I'm acting as a bank. Would I be breaking the law if I were to sell you a single share of, e.g. Google stock, in exchange for cash?

gloverkcn 13y ago

When someone hands you cash and you are giving them something not a product/service (i.e. can't be a monetary instrument or a promise of in anyway providing the money back to the customer) then you are acting as a bank. So a new company can offer the service, but the aren't an armored car company they are a banking company and are required to get a banking charter. You can try create services that somehow skate the line (which is what all of the check cashing, payday advance, and title loan companies do, but they are classified as MSBs), but an AG (Attorney General) in any state where you are operating can come after you. The feds will also come after you if they think you are illegally taking deposits which can involve criminal charges.

rahimnathwani 13y ago
FWIW, in the UK: - There is an important difference between MSBs and banks: banks can take deposits. - Loan companies (e.g. payday advance, as you mention) are different: they need a Consumer Credit Licence and are regulated by the OFT/FCA. To your main point: I don't understand how (even in the US) my accepting cash in exchange for 'not a product/service' would mean I'm acting as a bank. Would I be breaking the law if I were to sell you a single share of, e.g. Google stock, in exchange for cash?