USA Law and Practice Contributed by: Margo H. K. Tank, Michael Fluhr, Deborah Meshulam, Kristin Boggiano, David Stier, Liz S. M. Caires, Adam Dubin, Emily Honsa Hicks, Meghan Carey, Kathleen Birrane and Eric Hall, DLA Piper LLP
payee acceptance of the new payment network serves to limit the development of new payment networks. 5.2 Regulation of Cross-Border Payments and Remittances Cross-border payments and remittances are subject to a US financial regulatory framework which addresses consumer protection, AML/ CTF, and/or commercial efficiencies. Federal consumer protection laws such as the EFTA and Regulation E, as well as state law equivalents, generally require a cross-border or remittance transfer provider to comply with certain obligations, such as providing clear and accurate disclosures prior to payment regarding the fees to be charged and the ultimate timing of delivery to the intended recipient. A remittance provider must also provide receipts with similar disclosures for consumer retention. Additionally, state laws require money services businesses to obtain a licence, meet certain net worth and bonding requirements, and retain permissible assets to support their activities. Remittance transfer providers may be a subset of money services business required to adopt AML/CTF compliance programmes under the BSA which require the provider to conduct due diligence on their customers (KYC), engage in ongoing transaction monitoring for suspicious transmissions or money movement involving illegal activity, and meet transaction reporting requirements. See 2.15 Financial Action Task Force Standards . State laws such as Article 4A of the UCC pro - vide a legal framework for the efficient payment and transmission of money on a commercially reasonable basis. These laws set default rules governing the administration and role of various
parties involved in the transfer of funds for busi - ness-to-business or commercial purposes (and do not involve transactions to/from consumer accounts). 6. Marketplaces, Exchanges and Trading Platforms 6.1 Permissible Trading Platforms Fintech marketplaces offer a wide array of finan - cial offerings, such as: • loans and credit; • investments and wealth management; • insurance; and • payment solutions (eg, digital wallets and P2P platforms). Fintech marketplaces aim to simplify access to financial products and services by aggregating offerings from multiple providers in one place. They can enhance transparency, competition, and choice in the financial industry. All fintech marketplaces must ensure they com - ply with all laws and regulations applicable to the services and products offered. 6.2 Regulation of Different Asset Classes See 10. Blockchain . 6.3 Impact of the Emergence of Cryptocurrency Exchanges Engaging in the business of selling or exchang - ing cryptocurrency constitutes money trans - mission under US federal and state regulation. Money transmission regulations treat cryptocur - rency similarly to fiat currency and often require that the exchange obtain a money transmission licence. Custodying customer funds may also trigger licensing. If the asset is deemed a securi -
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