Leawood, Kan. – March 25, 2025: The U.S. Department of Treasury’s Financial Crime Enforcement Network (“FinCEN”) issued a Geographic Targeting Order (“GTO”) targeted at illicit activities and money laundering of Mexico-based drug cartels and other criminal actors along the southwest border of the United States. The terms of the GTO are effective beginning on April 14, 2025, and ending on September 9, 2025.
The GTO will require certain Covered Businesses to file Currency Transaction Reports (“CTR”) with FinCEN for Covered Transactions. “’Covered Transactions’ means each deposit, withdrawal, exchange of currency, or other payment or transfer by, through, or to the Covered Business which involves a transaction in currency, of more than $200 but not more than $10,000.” See, Issuance of a Geographic Targeting Order Imposing Additional Recordkeeping and Reporting Requirements on Certain Money Services Businesses Along Southwest Board, 90 Fed. Reg. 12,106 at 12,107 (March 14, 2025). Covered Businesses are defined as those Money Services Business as defined in 31 CFR 1010.100(ff) located in the Covered Geographic Area. Id. Money Services Businesses are defined as dealers in the following: (1) foreign exchange, (2) check casher, (3) issuer or seller of traveler’s checks or money orders, (4) providers of prepaid access, (5) money transmitter, (6) U.S. Post Office, or (7) sellers of prepaid access. 31 CFR 1010.100(ff)(1)-(7). Specifically exempted from the definition of Money Service Businesses is a bank or foreign bank. 31 CFR 1010.100(ff)(8)(1).
The GTO is limited in geographical scope to those money service businesses located in the Covered Geographic Area which means the counties in the following zip codes across California and Texas:
- Imperial County, California: 92231, 92249, 92281, 92283
- San Diego County, California: 91910, 92101, 92113, 92117, 92126, 92154, 92173
- Cameron County, Texas: 78520, 78521
- El Paso County, Texas: 79901, 79902, 79903, 79905, 79907, 79935
- Hidalgo County, Texas: 78503, 78557, 78572, 78577, 78596
- Maverick County, Texas: 78852
- Webb County, Texas: 78040, 78041, 78043, 78045, 78046
Therefore, money service businesses located outside this geographical scope are also exempt from the GTO. See, Issuance of a Geographic Targeting Order Imposing Additional Recordkeeping and Reporting Requirements on Certain Money Services Businesses Along Southwest Board, 90 Fed. Reg. 12,106 at 12,107 (March 14, 2025).
Some view the GTO as not applying to gift cards that are exempt from the FinCEN regulation under the closed-loop exemption or the open-loop exemption. Inquiries have been made to FinCEN for clarification on this subject. We will continue to monitor the application and interpretation of this GTO to prepaid access programs and provide updates if any additional information becomes available.
To read the press release and the GTO click here: FinCEN GTO March 11, 2025.
About the Compliance Libraries:
The Compliance Libraries provide a one stop location for comprehensive information on the laws, rules and standards regulating gift cards. Its range includes federal and state laws, GAAP accounting standards and tax rules along with other helpful items.
For more information visit www.compliancelibraries.com.
CARD Alerts are distributed by Compliance Libraries which is maintained by Card Issuance & Management, Inc., a subsidiary of Card Compliant, LLC.