Topic: Bank Secrecy Act & Anti-Money Laundering (BSA/AML)
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Aside from filing a SAR, is there any other reporting we are obliged to do if we receive a mortgage loan application with what we believe to be fraudulent information — falsified tax returns, bank statements, etc.?
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We believe your bank should file the SAR, and management should report the filing to your Board of Directors. The FDIC's rules state the following about additional reporting at 12 CFR 353.3(b)(2) and 353.3(c), as follows: (b)(2) In situations involving violations requiring immediate attention, such as when a reportable violation is ongoing, the bank shall…
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What requirements would apply if we were to allow a high school foreign exchange student to open a checking account?
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Below are some of the issues we would consider before opening an account for a high school foreign exchange student. BSA/AML Requirements We recommend looking at your customer identification program (CIP) policies and considering what information you would like to collect from the student. The CIP regulations require you to collect the following information from…
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Some of our customers have video poker machines or other gaming systems on their premises. Are there any BSA/AML issues we should be aware of?
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A customer that operates a video poker game will require some extra attention. We recommend monitoring the customer for compliance with the registration requirements and many other requirements in the Video Gaming Act, 230 ILCS 40, and in the Illinois Gaming Board’s regulations, 11 Ill. Adm. Code 1800. For example, Illinois law requires video game…
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What requirements apply when a customer opens a “doing business as” (d/b/a) account?
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Your procedures may differ for “unregistered businesses” (such as sole proprietorships and certain partnerships) that use an assumed name compared to registered business entities (corporations, limited liability companies, etc.) that use an assumed name. Unregistered businesses are not required to register with the Secretary of State, including sole proprietorships and general partnerships. Types of business entities…
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Are we required to comply with an administrative subpoena from an out of state agency that asks for supporting documentation on SARs and CTRs?
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While we cannot offer any specific advice as to the subpoena that the bank received, we can provide general guidance: Information regarding the filing of a suspicious activity report (SAR) — or the fact that a SAR was or was not filed — should not be disclosed by a bank or any officer, employee or…
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What is the record retention period for BSA 314 reports?
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There are no specific record retention requirements as to retaining records related to 314(a) requests. However, the FFIEC BSA/AML Examination Manual states that “documentation that all required searches were performed is essential.” It recommends printing off “search self-verification document for each 314(a) subject list transmission” and a “Subject Response List.” It also notes a financial…
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Are you aware of any risks (besides Regulation GG if applicable and BSA/AML considerations) in allowing a customer to open a video poker account?
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A customer that operates a video poker game will require some extra attention. We would recommend monitoring the customer for compliance with the registration requirements and many other provisions in the Video Gaming Act, 230 ILCS 40/1 et seq. Further, note that the FFIEC’s 2005 “Money Laundering Threat Assessment” publication identified video poker games as…
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When should we check customers’ identities against the OFAC lists?
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There are no laws or regulations that specify when you should check for OFAC-specified customers. Instead, there are penalties for failing to block, reject, or report a transaction with an OFAC-specified country, entity, or individual. See Economic Sanctions Enforcement Guidelines, Appendix A to 31 CFR Part 501 (under which a bank’s OFAC compliance program can…