By April 24, 2002 - every financial institution is required to
have adopted policies, procedures and controls to detect and prevent money
By July 23, 2002
- every financial institution is required to
have adopted special due diligence procedures for correspondent
accounts and private banking accounts maintained by non-U.S.
By October 26, 2002
- every financial institution is required to have implemented "know
your customer" procedures for opening customers accounts.
THE UNITING AND STRENGTHENING
AMERICA BY PROVIDING APPROPRIATE TOOLS REQUIRED TO INTERCEPT AND OBSTRUCT
TERRORISM ACT OF 2001- The USA Patriot Act (the "Act")- was
signed on October 26, 2001 to amend the Bank Secrecy Act and other legislation
to require that financial institutions establish anti-money laundering
programs which are intended to fight terrorism and other criminal activities.
The Act places new or additional
requirements on financial institutions. Some of the new requirements include:
- Having appropriate controls reasonably designed to detect and report
instances of money laundering
- Ensuring that U.S.
correspondent accounts for foreign banks are not used to indirectly
provide banking services to foreign "shell" banks- banks that have no
physical presence in any country
- Identifying accounts
maintained by senior foreign political figures, their immediate families
or close associates
procedures for identifying customers opening accounts, including procedures
to verify customer identity and maintaining records of information used
to verify identity
- Designating a compliance
officer, conducting ongoing employee training and establishing an independent
auditing function to test the anti-money laundering programs in place
Institutions and the USA Patriot Act