I've hit so many roadblocks since day 1 in this business that it doesn't come as a surprise to me anymore when I hear this line: "We can't work with you because you are in the financial industry and are a Money Service Business."
I can't help but think that the big boys are influencing the regulations so that the growing businesses like PeerFX, that actually want to do something for the everyday consumer instead of ripping them off, cease to be on the playing field.
Of course, I still think rules were made to be broken :)
I've spent most of my morning trying to get on board with some potential new partners with no luck. I keep hearing that damned line - "We can't work with you because you are a Money Service Business".
After being in the industry for 2 years now it's FRUSTRATING! Seriously, the rules you put in place lock out everybody EXCEPT the criminals. Would a real criminal tell you that they are a forex broker or that they are trying to launder money? I don't think so.
If they do then they should be on the show World's Dumbest Criminals. Plus, we know that the "successful" criminals cannot be barred out by these regulations anyway, so who are we kidding?
Hitting 5000 walls has not stopped me from building this business and though this wall seems larger than the ones before, I'm determined to break you down.
1 comment:
Hi. I am also in the foreign exchange industry and I liked your post very much. Unfortunately, it's not only the big boys (RBC and BMO) who are influencing the regulators. It is the regulators - FINTRAC - themselves (as you pointed out) who have caused a mess in Canada's foreign exchange market by even allowing criminal to open up shop.
It is FINTRAC who ultimately allows anyone off the street to open up an MSB and it is the banks that respond negatively when some of these little guys are up to no good and are caught money laundering - runing the reputation of all of us.
You are very right that it makes it very tough in the industry for all of us and the forex market in Canada is dying. Possibly, this is what the big banks want. After all, their spreads are ridiculously high.
Having said that, the worse of the "big boys" are both RBC and BMO. It was RBC a few years ago that spearheaded the whole thing, but it is BMO who got a bad wrap because most MSB's were with BMO as it was easier to deal with BMO. This event was well known in this industry and we were all waiting for it and it came as promised.
The only thing one can do is to ensure they have a rigorous AML Compliance Regime and Risk Management Policies in place and have it auduted by an external auditor (between $5,000 to $10,000 in most cases) to prove compliance for the bank.
In Vancouver, there are ONLY (yes only) 4 major banknote foreign exchange dealers that have not lost their bank account. I am not sure about companies like yours because I am in banknotes, but, am assuming that most electronic forex changers are still ok with their accounts.
Difficult times for foreign exchange in Canada and according to FINTRAC, the next ten years (known as phase 2 by FINTRAC) will be even stricter with even more challenges for all of us.
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