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FIAT - DASH Compliance / ATM Compliance

Discussion in 'Project Updates' started by Minotaur, Jan 10, 2017.

  1. Minotaur

    Minotaur Well-known Member
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    Another aspect that requires some legal research is what are the compliance requirements to facilitate Dash FIAT exchange. This can be in the form of running ATM kiosks or using other mechanisms to personally offer DASH to FIAT exchange services.


    For this purpose we hired Cogent Law who have a lot of experience working in compliance for digital money services. They are putting together a compliance program that will be shared with anyone launching a Dash service if they require it. This includes:

    • A finCEN BSA compliant written Principal MSB/KYC AML Program designed to prevent the Principal MSB from being used to facilitate money laundering and the financing of terrorist activities

    • A comprehensive risk based assessment by a third party compliance consultant expert

    Our lawyer for this project is Adella Toulon-Foerster who has extensive experience in this field including:


    • Banking Secrecy Act (BSA), Anti-Money Laundering (AML), and Know Your Customer (KYC) regulations

    • FinCEN requirements and guidance

    • Written and on-going AML compliance programs

    • State-by-state money transmitter laws and licensure requirements


    There was an initial delay funding the law firm’s retainer in September. We were attempting to pay with Bitcoin, but their account with BitPay was not functioning, and it took several weeks to resolve. The project finally funded in October.


    We have had several meetings with the lawyers clarifying different aspects of Dash. The law firm is now nearly completed with the work to establish the compliance program requirements. We expect final delivery this month and will share this information with the community. It has not been determined yet if the documentation will be put online for anyone to download or do it by request, since it is valuable legal research. We are in the process of checking on this with counsel. We expect this information to be valuable for community members that are looking to start a Dash business.


    Phase II of the compliance program - which has not yet been approved / funded - would aim to run a pilot program with a limited number of ATM operators in a few pre-selected states. This pilot program would require operators to share data on usage and profitability to determine if a wider-scale program could be self-sustaining or even provide a profit back to the network.
     
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  2. Minotaur

    Minotaur Well-known Member
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    Today we have received full documentation of the compliance program from Cogent Law. This program should be useful for Dash enthusiasts wanting to launch a Dash service that includes exchanging coins for FIAT e.g. Crypto ATM kiosks, high profile Local Bitcoins type sellers, brokerage, etc.

    The package includes:

    - BSA AML Compliance training

    - KYC CDD Policy

    - AML Program

    - Risk Assessment

    - Surveillance and Monitoring Policy

    - Different Reports to file in different situations

    The documents have a format as if they were created for the fictional company “Initech” and then the interested Dash entrepreneur would have to replace it with their real corporation. We believe that some counsel would still be advisable for an investor launching a service but this will really help them get a good understanding of the requirements and let’s say 80% of the way. This should also be highly educational and help the Dash investor be more at ease as it enlightens a typically obscure topic for most crypto enthusiasts.

    Please give us a few days to digest all this, we still have a meeting scheduled for this week with the lawyers so they can explain the steps in which the program should be implemented and we still need to understand it and put it into a format that could be shared with the interested Dash investors.

    One thing that has not been completely decided yet is how to share this information, one option is to make it available upon request by Dash investors truly interested in running a service another option is consulting with the lawyers to see to what extent the documentation could just be publicly shared on the website, one drawback of just posting it online is it would be difficult to keep it within the Dash network. We are still not sure about what approach is best on this and would benefit from feedback from the community, so we will soon be consulting the community on this and trying to arrive at a good solution. Thanks for the support.

    This program is directed at Dash investors that are interested in running a compliant service in regulated markets. If some users prefer to run services without a compliance program or don't need one, we completely respect that too.
     
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  3. Minotaur

    Minotaur Well-known Member
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