Interagency third-party risk guidance (OCC 2023-17, FDIC FIL-29-2023, FRB SR 23-4) expects banks to diligence, contract, monitor, and exit fintech partners with evidence. Crypto and stablecoin partners add MSB/MTL status, Travel Rule at $3,000, wallet screening, reserves and custody, and GENIUS Act readiness ahead of January 18, 2027.
Due diligence checklist
Licensing and MSB status
- FinCEN MSB registration current, with change notices filed when required (31 CFR 1022.380).
- State money transmitter licenses (or pending applications) in every state where customers are served.
- NMLS call reports, renewals, net worth, and surety bond evidence current.
- Clarity on whether the partner is (or will be) a permitted payment stablecoin issuer under the GENIUS Act.
BSA/AML and Travel Rule
- Written AML program with CIP/CDD, independent testing, training, and a named BSA officer.
- Travel Rule collection and transmission for transfers at or above $3,000, with exception handling.
- SAR investigation and filing evidence for a recent sample period.
- For payment stablecoin activity: gap analysis against the FinCEN/OFAC April 2026 NPRM (AML/CFT, CDD, SAR, U.S. AML officer, block/freeze, sanctions).
Sanctions and wallet screening
- OFAC screening at onboarding and on an ongoing cadence, with documented hit disposition.
- Wallet / blockchain analytics for sanctioned, mixer-linked, or high-risk addresses.
- Policy for unhosted / self-hosted wallet transfers where applicable.
- Periodic re-screening of the existing customer and wallet base.
Reserves, custody, and GENIUS Act status
- Reserve composition, segregation, and custody arrangements (and how they map to 12 CFR part 15 if OCC-supervised).
- Redemption procedures, SLAs, and recent performance evidence.
- Attestations, audits, and capital/operational-backstop documentation.
- Written plan to be ready by the GENIUS Act effective date of January 18, 2027.
Third-party risk and ongoing monitoring
- Due diligence aligned to OCC 2023-17, FDIC FIL-29-2023, and FRB SR 23-4 across the relationship lifecycle.
- Contractual rights to information, audit, remediation, and orderly exit.
- Ongoing monitoring cadence by risk tier, with findings tracked to validated closure.
- Board or committee reporting that shows the partner's exam-readiness evidence, not just policy attestations.
Download the printable due diligence checklist
Email unlocks a print-ready version you can attach to a credit memo or partner committee packet.
Proof points
Canarie is SOC 2 Type II certified. Review the Trust Center. Partner enablement includes Role Fintech for compliant card, payments, and stablecoin programs.
FAQ
- What should a sponsor bank check before onboarding a crypto or stablecoin fintech?
- Confirm MSB/MTL status, BSA/AML and Travel Rule operating evidence, sanctions and wallet screening, reserves and custody where relevant, GENIUS Act readiness for payment stablecoin activity, and third-party risk controls that match interagency guidance (OCC 2023-17, FDIC FIL-29-2023, FRB SR 23-4).
- How does the GENIUS Act change sponsor-bank diligence?
- For payment stablecoin partners, banks should ask whether the partner will be a permitted payment stablecoin issuer, how it meets (or plans to meet) OCC 12 CFR part 15 standards effective January 18, 2027, and how it is tracking FinCEN/OFAC's still-proposed AML/sanctions requirements. Diligence should demand evidence, not a slide deck.
- Does every crypto partner need a money transmitter license?
- Activity that transmits money or monetary value typically triggers FinCEN MSB registration and state MTL requirements. Structure, custody model, and state definitions matter. Require counsel-backed licensing opinions and current NMLS evidence rather than assuming a bank charter covers the fintech's own activity.
- What ongoing monitoring should continue after onboarding?
- Risk-tiered reporting, sample testing of Travel Rule and sanctions controls, reserve/redemption evidence where applicable, issue tracking to closure, and annual (or more frequent) partner reviews with refresh of licensing and GENIUS Act status.
Walk through a crypto partner evidence pack
See how sponsor-bank teams keep licensing, Travel Rule, and GENIUS Act items owned between exams.