Financial Institution Definition | (2024)

Financial Institution- A "financial institution" includes anypersondoing business in one or more of the following capacities:

(1) bank (except bank credit card systems);
(2) broker or dealer in securities;
(3) money services business;
(4) telegraph company;
(5) casino;
(6) card club;
(7) a person subject to supervision by any state or federal bank supervisory authority.

For the regulatory definition of "financial institution," see 31 CFR 1010.100(t) (formerly 31 CFR 103.11(n)).

Financial Institution Definition | (2024)


What is a financial institution under 31 CFR? ›

It includes but is not limited to depository institutions, banks, savings banks, money service businesses, trust companies, insurance companies, securities brokers and dealers, commodity futures and options brokers and dealers, forward contract and foreign exchange merchants, securities and commodities exchanges, ...

What is the legal definition of a financial institution? ›

A financial Institution is defined in 18 U.S. Code § 20 as an entity, national or international, that deals primarily in business related to financial or/and monetary transactions, namely loans, deposits, investments, currency exchange, or any other transaction of similar nature.

What is a financial institution under FinCEN? ›

Financial Institution - §1010.100(t) Each agent, agency, branch, or office within the United States of any person doing business, whether or not on a regular basis or as an organized business concern, in one or more of the capacities listed below:(1) A bank (except bank credit card systems); (2)A broker or dealer in ...

What is the definition of a financial institution? ›

A financial institution (FI) is a company engaged in the business of dealing with financial and monetary transactions such as deposits, loans, investments, and currency exchange. Financial institutions are vital to a functioning capitalist economy in matching people seeking funds with those who can lend or invest it.

What is the definition of a bank in the CFR? ›

As used in this part, unless the context requires otherwise: (a) Bank means an insured depository institution, as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813), and includes an insured national bank, state bank, District bank, or savings association, and an insured branch of a foreign bank.

What is the definition of account in 31 CFR 103.121 A )( 1? ›

(a) Definitions. For purposes of this section: (1)(i) Account means a formal bank- ing relationship established to provide or engage in services, dealings, or other financial transactions including a de- posit account, a transaction or asset account, a credit account, or other ex- tension of credit.

What is the difference between a bank and a financial institution? ›

Banks manage customers' deposits and facilitate transactions, while finance broadly encompasses the management of funds, whether for individuals, corporations, or governments. Credit and Loans: Both sectors provide loans and credit services.

What is an example of a financial institution? ›

Types of financial institutions include: Banks. Credit unions.

What is a financial institution in Black's Law Dictionary? ›

Definition & Citations:

An organization that is a channel between the parties involved in funds transfer between fund savers and fund borrowres. They are depository or nondepository insurance companies. Depository banks pay interest on a deposit from the interest on loans.

What does FinCEN request of financial institutions? ›

FinCEN requests that financial institutions select the appropriate characterization of suspicious activity in the Suspicious Activity Information section of the SAR form and include the term "elder financial exploitation" in the narrative portion of all relevant SARs filed.

What are FinCEN requirements? ›

Specifically, the regulations implementing the BSA require financial institutions to, among other things, keep records of cash purchases of negotiable instruments, file reports of cash transactions exceeding $10,000 (daily aggregate amount), and to report suspicious activity that might signify money laundering, tax ...

What is another term for financial institution? ›

bank, banking company, banking concern, depository financial institution.

What is the difference between a financial institution and a non financial institution? ›

A financial company / financial institution is one whose core business involved in borrowing, lending and at times subject to certain considerations even raising money for a non-financial company. A non-financial company is a business engaged in anything other than what a financial company does.

What are the three types of financial institutions? ›

They are commercial banks, thrifts (which include savings and loan associations and savings banks) and credit unions. These three types of institutions have become more like each other in recent decades, and their unique identities have become less distinct.

What makes a financial institution a bank? ›

Banks are intermediaries between depositors (who lend money to the bank) and borrowers (to whom the bank lends money). The amount banks pay for deposits and the income they receive on their loans are both called interest.

What are the mandatory requirements of a financial institution under the Bank Secrecy Act? ›

Under the Bank Secrecy Act (BSA), financial institutions are required to assist U.S. government agencies in detecting and preventing money laundering, such as: Keep records of cash purchases of negotiable instruments, File reports of cash transactions exceeding $10,000 (daily aggregate amount), and.

Which federal law requires financial institutions to have CIP? ›

identification program requirements implementing section 326 of the USA PATRIOT Act, 31 U.S.C. 5318(l), for loans extended by banks (and their subsidiaries) subject to the jurisdiction of the Federal Banking Agencies to all customers to facilitate purchases of property and casualty insurance policies.”

What is a financial institution as defined in the Federal Deposit Insurance Corporation Improvement Act of 1991? ›

--For purposes of this paragraph, the term "financial institution" means a broker or dealer, a depository institution, a futures commission merchant, or any other institution, as determined by the Corporation by regulation to be a financial institution, and the term "clearing organization" has the same meaning as in ...

Are all financial institutions required to have a written AML compliance program? ›

The Bank Secrecy Act, among other things, requires financial institutions, including broker-dealers, to develop and implement AML compliance programs. Members are also governed by the anti-money laundering rule in FINRA Rule 3310.

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