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California Corner: New FinCEN Geographic Targeting Order Impacts California Border Region Money Services Businesses

Last week, the Financial Crimes Enforcement Network (FinCEN) issued a significant Geographic Targeting Order (GTO) that will directly impact money services businesses (MSBs) operating in California’s border counties. This new order represents an important development for tax professionals advising clients in the affected regions.

What California Tax Professionals Need to Know

The GTO, released on March 11, 2025, dramatically lowers the Currency Transaction Report (CTR) threshold to just $200 for MSBs operating in specific ZIP codes along the southwest border. This represents a substantial change from the standard $10,000 CTR reporting requirement that most financial institutions follow.

For California tax professionals, this order specifically impacts clients operating in:

Imperial County:

  • 92231 (Calexico)
  • 92249 (Heber)
  • 92281 (Westmorland)
  • 92283 (Winterhaven)

San Diego County:

  • 91910 (Chula Vista)
  • 92101 (Downtown San Diego)
  • 92113 (Logan Heights/Barrio Logan)
  • 92117 (Clairemont)
  • 92126 (Mira Mesa)
  • 92154 (Otay Mesa)
  • 92173 (San Ysidro)

Implementation Timeline

The GTO will take effect 30 days after its publication in the Federal Register and remain in force for 179 days. This means MSBs in the affected ZIP codes should prepare now for implementation by mid-April.

The Following Types Of Businesses Are Likely To Be Affected

  1. Money Services Businesses (MSBs) specifically mentioned in the order:
    • Currency exchangers/money exchangers
    • Check cashers
    • Money transfer businesses (like Western Union, MoneyGram)
    • Money order issuers and sellers
    • Prepaid access providers and sellers

  2. Other financial service providers in the affected ZIP codes:
    • Convenience stores offering money transfer services
    • Grocery stores with check cashing or money order services
    • Small independent financial service providers
    • Mobile payment service providers with cash-in/cash-out capabilities

Compliance Implications

For tax professionals with clients operating MSBs in these areas, immediate action is recommended:

  1. Notify all affected clients about this significant change in reporting requirements
  2. Review and update client compliance procedures to accommodate the new $200 threshold
  3. Ensure client staff are trained on the updated reporting standards
  4. Consider potential impacts on client operations, as this may significantly increase reporting volume

Broader Context

The current action is specifically aimed at curtailing money laundering activities in border regions. While it also affects numerous ZIP codes in Texas (detailed in the full FinCEN release), the California impact is substantial, covering major border crossing areas and nearby communities.

Next Steps

Tax professionals with clients in the affected areas should immediately begin preparing for implementation. The drastically lower reporting threshold will likely result in a significant increase in filing requirements for MSBs in these regions.

For the complete list of affected ZIP codes, including those in Texas, and further details, refer to the original FinCEN release. Questions about the GTO should be directed to FinCEN through their website.