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|May 23, 2002
Treasury Department Issues Proposed Regulation Implementing Section 312 of the USA PATRIOT Act
The Treasury Department today issued and sent to the Federal Register for publication a proposed rule implementing Section 312 of the USA PATRIOT Act.
Section 312 requires certain U.S. financial institutions to take prescribed anti-money laundering measures with respect to correspondent and private banking accounts that they establish or maintain for non-U.S. persons.
Under the proposed rule, certain U.S. financial institutions would be required to establish a due diligence program for correspondent accounts they maintain for certain foreign financial institutions designed to detect and report money laundering, and to conduct enhanced due diligence for accounts maintained for foreign banks from certain jurisdictions considered of higher risk for money laundering.
In addition, these U.S. financial institutions must take reasonable steps to determine the owners of, and source of funds deposited into, private banking accounts they maintain for non-U.S. persons, and conduct enhanced scrutiny of such accounts maintained for senior foreign political figures in order to detect and report transactions involving the proceeds of foreign corruption.
The proposed rule is open to public comment for 30 days after it is published in the Federal Register, which is expected to occur next week.