Proposed Statutory Framework
Purpose:
At the Arizona level the funds could be used to create a specialized Section under the Criminal Division within the Arizona Attorney General’s Office or AZ Department of Public Safety to specifically combat Money Laundering and illicit wire transmissions of various forms statewide. The unit will consist of a specialized team of prosecutors and investigators to directly combat various forms of money laundering. Having such a specialized team would allow for proactive and extremely complicated investigations being totally funded by one of the most common mechanisms utilized to transport illicit funds, person to person wire transfers. Specific language in this Initiative protects legitimate person to business wire transfers to protect legitimate commerce in and out of Arizona.
At the national level, the fee could be used to combat transnational criminal organizations and to bolster security along the United States Mexico border.
Wire transmitter fee:
The Arizona proposal would assess a fee against licensees on each money transmission transaction initiated at a location of any licensee or its delegate of a money transmitter or wire transmitter business within the state of Arizona. ADOR shall transfer the collected funds to the Arizona Attorney General’s Office or AZ Department of Public Safety quarterly.
A per transaction fee assessed to each transaction for money transmitters such as Western Union, Walmart, MoneyGram and even BitCoin.
Amounts:
The fee shall be assessed on the amount of the money transmission, exclusive of fees and costs. The amount of the fee shall be determined as follows:
Domestic non-commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
(2) For each transaction in the amount of One Hundred Dollars ($100.00) or more, the fee is Two Dollars ($2.00) plus one percent (1%) of the amount in excess of One Hundred Dollars ($100.00).
International non-commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
(2) For each transaction in the amount of One Hundred Dollars ($100.00) or more, the fee is Two Dollars ($2.00) plus one percent (1%) of the amount in excess of One Hundred Dollars ($100.00).
Domestic and International commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
Proposed Statutory Framework
Purpose:
At the National level the funds could be used to combat transnational criminal organizations and to bolster security along the United States Mexico border.
Wire transmitter fee:
The basic concept is as follows; there is a fee levied against licensees by this Initiative on each money transmission transaction initiated at a location of any licensee or its delegate of a money transmitter or wire transmitter business within the United States or its territories. A per transaction fee assessed to each transaction for money transmitters such as Western Union, Walmart, MoneyGram and even BitCoin.
Amounts:
The fee shall be assessed on the amount of the money transmission, exclusive of fees and costs. The amount of the fee shall be determined as follows:
Domestic non-commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
(2) For each transaction in the amount of One Hundred Dollars ($100.00) or more, the fee is Two Dollars ($2.00) plus one percent (1%) of the amount in excess of One Hundred Dollars ($100.00).
International non-commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
(2) For each transaction in the amount of One Hundred Dollars ($100.00) or more, the fee is Two Dollars ($2.00) plus one percent (1%) of the amount in excess of One Hundred Dollars ($100.00).
Domestic and International commercial transactions:
(1) For each transaction not in excess of One Hundred Dollars ($100.00), the fee is Two Dollars ($2.00).
o.
Estimated Revenue
In 2015 I explored the Western Union data to examine the number of person to person money transmissions that originated inside the state of Arizona. The number was very close to the population of Arizona, around 6 million.
Using the state model, revenue for an Arizona fee would be around $12-14M.
Using the same model nationally for person to person transmissions, the estimate would be over $600M.
Both calculations would increase dramatically using the additional fee-triggers such as money transmitted out of the country and a flat fee for commercial transactions. These additional fee-triggers could easily push the revenue nationally over $1 Billion dollars annually. Arizona would see a much more modest increase to around $16M.
Disclaimer on estimates:
The ability to collect exact figures is rather difficult. The 2015 data was from an analysis of Western Union and a couple other money transmitters operating within Arizona. Since the 2015 analysis, Walmart and other large companies have entered the money transmitter industry. As a result, the analysis can best be described as a snapshot of 2015 Arizona Money Transmitters. Extrapolation to the national level using the untested model is far from being highly a confidant prediction.