PARTS 1000–1009[RESERVED] 1010.440 Person outside the United States. Subpart E—Special Information Sharing PART 1010—GENERAL PROVISIONS Procedures To Deter Money Laun- dering and Terrorist Activity Subpart A—General Definitions 1010.500 General. Sec. 1010.505 Definitions. 1010.100 General definitions. 1010.520 Information sharing between gov- ernment agencies and financial institu- Subpart B—Programs tions. 1010.530 [Reserved] 1010.200 General. 1010.540 Voluntary information sharing 1010.205 Exempted anti-money laundering among financial institutions. programs for certain financial institu- tions. Subpart F—Special Standards of Diligence; 1010.210 Anti-money laundering programs. Prohibitions; and Special Measures 1010.220 Customer identification program 1010.600 General. requirements. SPECIAL DUE DILIGENCE FOR CORRESPONDENT Subpart C—Reports Required To Be Made ACCOUNTS AND ACCOUNTS

1010.300 General. 1010.605 Definitions. 1010.610 Due diligence programs for cor- 1010.301 Determination by the Secretary. respondent accounts for foreign financial 1010.305 [Reserved] institutions. 1010.306 Filing of reports. 1010.620 Due diligence programs for private 1010.310 Reports of transactions in currency. banking accounts. 1010.311 Filing obligations for reports of 1010.630 Prohibition on correspondent ac- transactions in currency. counts for foreign shell ; records 1010.312 Identification required. concerning owners of foreign banks and 1010.313 Aggregation. agents for service of legal process. 1010.314 Structured transactions. 1010.640 [Reserved] 1010.315 Exemptions for non- financial SPECIAL MEASURES UNDER SECTION 311 OF THE institutions. USA PATRIOT ACT AND LAW ENFORCEMENT 1010.320 Reports of suspicious transactions. ACCESS TO FOREIGN BANK RECORDS 1010.330 Reports relating to currency in ex- cess of $10,000 received in a trade or busi- 1010.651 Special measures against Burma. ness. 1010.652 Special measures against Myanmar 1010.340 Reports of transportation of cur- Mayflower Bank and Asia Wealth Bank. 1010.653 Special measures against Commer- rency or monetary instruments. cial Bank of . 1010.350 Reports of foreign financial ac- 1010.654 Special measures against VEF counts. Bank. 1010.360 Reports of transactions with for- 1010.655 Special measures against Banco eign financial agencies. Delta Asia. 1010.370 Reports of certain domestic coin 1010.670 Summons or subpoena of foreign and currency transactions. bank records; termination of cor- respondent relationship. Subpart D—Records Required To Be Maintained Subpart G—Administrative Rulings

1010.400 General. 1010.710 Scope. 1010.401 Determination by the Secretary. 1010.711 Submitting requests. 1010.405 [Reserved] 1010.712 Nonconforming requests. 1010.410 Records to be made and retained by 1010.713 Oral communications. financial institutions. 1010.714 Withdrawing requests. 1010.715 Issuing rulings. 1010.415 Purchases of bank checks and 1010.716 Modifying or rescinding rulings. drafts, cashier’s checks, money orders 1010.717 Disclosing information. and traveler’s checks. 1010.420 Records to be made and retained by Subpart H—Enforcement; Penalties; and persons having financial interests in for- Forfeiture eign financial accounts. 1010.430 Nature of records and retention pe- 1010.810 Enforcement. riod. 1010.820 Civil penalty.

585

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00595 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.100 31 CFR Ch. X (7–1–11 Edition)

1010.830 Forfeiture of currency or monetary transports, mails, ships or receives; is instruments. about to or attempts to transport, mail 1010.840 Criminal penalty. or ship; or causes the transportation, 1010.850 Enforcement authority with respect to transportation of currency or mone- mailing, shipment or receipt of mone- tary instruments. tary instruments, is deemed to do so ‘‘at one time’’ if: Subpart I—Summons (1) That person either alone, in con- junction with or on behalf of others; 1010.911 General. (2) Transports, mails, ships or re- 1010.912 Persons who may issue summons. 1010.913 Contents of summons. ceives in any manner; is about to 1010.914 Service of summons. transport, mail or ship in any manner; 1010.915 Examination of witnesses and or causes the transportation, mailing, records. shipment or receipt in any manner of; 1010.916 Enforcement of summons. (3) Monetary instruments; 1010.917 Payment of expenses. (4) Into the United States or out of Subpart J—Miscellaneous the United States; (5) Totaling more than $10,000; 1010.920 Access to records. (6)(i) On one calendar day; or 1010.930 Rewards for informants. (ii) If for the purpose of evading the 1010.940 Photographic or other reproduc- reporting requirements of § 1010.340, on tions of Government obligations. 1010.950 Availability of information. one or more days. 1010.960 Disclosure. (c) Attorney General. The Attorney 1010.970 Exceptions, exemptions, and re- General of the United States. ports. (d) Bank. Each agent, agency, branch 1010.980 Dollars as including foreign cur- or office within the United States of rency. any person doing business in one or AUTHORITY: 12 U.S.C. 1829b and 1951–1959; 31 more of the capacities listed below: U.S.C. 5311–5314, 5316–5332; title III, sec. 314, (1) A or trust com- Pub. L. 107–56, 115 Stat. 307. pany organized under the laws of any SOURCE: 75 FR 65812, Oct. 26, 2010, unless State or of the United States; otherwise noted. (2) A private bank; (3) A savings and association or Subpart A—General Definitions a building and loan association orga- nized under the laws of any State or of § 1010.100 General definitions. the United States; When used in this chapter and in (4) An insured institution as defined forms prescribed under this chapter, in section 401 of the National Housing where not otherwise distinctly ex- Act; pressed or manifestly incompatible (5) A savings bank, industrial bank or with the intent thereof, terms shall other thrift institution; have the meanings ascribed in this sub- (6) A credit union organized under part. Terms applicable to a particular the law of any State or of the United type of financial institution or specific States; part or subpart of this chapter are lo- (7) Any other organization (except a cated in that part or subpart. Terms money services business) chartered may have different meanings in dif- under the banking laws of any state ferent parts or subparts. and subject to the supervision of the (a) Accept. A receiving financial insti- bank supervisory authorities of a tution, other than the recipient’s fi- State; nancial institution, accepts a trans- (8) A bank organized under foreign mittal order by executing the trans- law; mittal order. A recipient’s financial in- (9) Any national banking association stitution accepts a transmittal order or corporation acting under the provi- by paying the recipient, by notifying sions of section 25(a) of the Act of Dec. the recipient of the receipt of the order 23, 1913, as added by the Act of Dec. 24, or by otherwise becoming obligated to 1919, ch. 18, 41 Stat. 378, as amended (12 carry out the order. U.S.C. 611–32). (b) At one time. For purposes of (e) Bank Secrecy Act. The Currency § 1010.340 of this part, a person who and Foreign Transactions Reporting

586

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00596 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.100

Act, its amendments, and the other ficial foreign bank notes that are cus- statutes relating to the subject matter tomarily used and accepted as a me- of that Act, have come to be referred to dium of exchange in a foreign country. as the Bank Secrecy Act. These stat- (n) Deposit account. Deposit accounts utes are codified at 12 U.S.C. 1829b, 12 include transaction accounts described U.S.C. 1951–1959, 18 U.S.C. 1956, 18 in paragraph (ccc) of this section, sav- U.S.C. 1957, 18 U.S.C. 1960, and 31 U.S.C. ings accounts, and other time deposits. 5311–5314 and 5316–5332 and notes there- (o) Domestic. When used herein, refers to. to the doing of business within the (f) Beneficiary. The person to be paid United States, and limits the applica- by the beneficiary’s bank. bility of the provision where it appears (g) Beneficiary’s bank. The bank or to the performance by such institu- foreign bank identified in a payment tions or agencies of functions within order in which an account of the bene- the United States. ficiary is to be credited pursuant to the (p) Established customer. A person order or which otherwise is to make with an account with the financial in- payment to the beneficiary if the order stitution, including a loan account or does not provide for payment to an ac- deposit or other asset account, or a count. person with respect to which the finan- (h) Broker or dealer in securities. A cial institution has obtained and main- broker or dealer in securities, reg- tains on file the person’s name and ad- istered or required to be registered dress, as well as taxpayer identifica- with the Securities and Exchange Com- tion number (e.g., social security or mission under the Securities Exchange employer identification number) or, if Act of 1934, except persons who register none, alien identification number or pursuant to section 15(b)(11) of the Se- passport number and country of curities Exchange Act of 1934. issuance, and to which the financial in- (i) Business day. As used in this chap- stitution provides re- ter with respect to banks, business day lying on that information. means that day, as normally commu- (q) Execution date. The day on which nicated to its depository customers, on the receiving financial institution may which a bank routinely posts a par- properly issue a transmittal order in ticular transaction to its customer’s execution of the sender’s order. The account. execution date may be determined by (j) Commodity. Any good, article, instruction of the sender but cannot be service, right, or interest described in earlier than the day the order is re- section 1a(4) of the Commodity Ex- ceived, and, unless otherwise deter- change Act (‘‘CEA’’), 7 U.S.C. 1a(4). mined, is the day the order is received. (k) Common carrier. Any person en- If the sender’s instruction states a pay- gaged in the business of transporting ment date, the execution date is the individuals or goods for a fee who holds payment date or an earlier date on himself out as ready to engage in such which execution is reasonably nec- transportation for hire and who under- essary to allow payment to the recipi- takes to do so indiscriminately for all ent on the payment date. persons who are prepared to pay the fee (r) Federal functional regulator. for the particular service offered. (1) The Board of Governors of the (l) Contract of sale. Any sale, agree- Federal Reserve System; ment of sale, or agreement to sell as described in section 1a(7) of the CEA, 7 (2) The Office of the Comptroller of U.S.C. 1a(7). the Currency; (m) Currency. The coin and paper (3) The Board of Directors of the Fed- money of the United States or of any eral Deposit Insurance Corporation; other country that is designated as (4) The Office of Thrift Supervision; legal tender and that circulates and is (5) The National Credit Union Admin- customarily used and accepted as a me- istration; dium of exchange in the country of (6) The Securities and Exchange issuance. Currency includes U.S. silver Commission; or certificates, U.S. notes and Federal Re- (7) The Commodity Futures Trading serve notes. Currency also includes of- Commission.

587

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00597 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.100 31 CFR Ch. X (7–1–11 Edition)

(s) FinCEN. FinCEN means the Fi- (6)(i) Card club. A card club, gaming nancial Crimes Enforcement Network, club, card room, gaming room, or simi- a bureau of the Department of the lar gaming establishment that is duly Treasury. licensed or authorized to do business as (t) Financial institution. Each agent, such in the United States, whether agency, branch, or office within the under the laws of a State, of a Terri- United States of any person doing busi- tory or Insular Possession of the ness, whether or not on a regular basis United States, or of a political subdivi- or as an organized business concern, in sion of any of the foregoing, or under one or more of the capacities listed the Indian Gaming Regulatory Act or below: other Federal, State, or tribal law or (1) A bank (except bank arrangement affecting Indian lands (in- systems); cluding, without limitation, an estab- (2) A broker or dealer in securities; lishment operating on the assumption (3) A money services business as de- or under the view that no such author- fined in paragraph (ff) of this section; ization is required for operation on In- (4) A telegraph company; dian lands for an establishment of such (5)(i) Casino. A casino or gambling ca- type), and that has gross annual gam- sino that: Is duly licensed or author- ing revenue in excess of $1,000,000. The ized to do business as such in the term includes the principal head- United States, whether under the laws quarters and every domestic branch or of a State or of a Territory or Insular place of business of the establishment. Possession of the United States, or The term ‘‘casino,’’ as used in this under the Indian Gaming Regulatory chapter shall include a reference to Act or other Federal, State, or tribal ‘‘card club’’ to the extent provided in law or arrangement affecting Indian paragraph (t)(5)(iii) of this section. lands (including, without limitation, a (ii) For purposes of this paragraph casino operating on the assumption or (t)(6), ‘‘gross annual gaming revenue’’ under the view that no such authoriza- means the gross revenue derived from tion is required for casino operation on or generated by customer gaming ac- Indian lands); and has gross annual tivity (whether in the form of per-game gaming revenue in excess of $1 million. or per-table fees, however computed, The term includes the principal head- rentals, or otherwise) and received by quarters and every domestic branch or an establishment, during either the es- place of business of the casino. tablishment’s previous business year or (ii) For purposes of this paragraph its current business year. A card club (t)(5), ‘‘gross annual gaming revenue’’ that is a financial institution for pur- means the gross gaming revenue re- poses of this chapter solely because its ceived by a casino, during either the gross annual revenue exceeds $1,000,000 previous business year or the current during its current business year, shall business year of the casino. A casino or not be considered a financial institu- gambling casino which is a casino for tion for purposes of this chapter prior purposes of this chapter solely because to the time in its current business year its gross annual gaming revenue ex- when its gross annual revenue exceeds ceeds $1,000,000 during its current busi- $1,000,000; ness year, shall not be considered a ca- (7) A person subject to supervision by sino for purposes of this chapter prior any state or Federal bank supervisory to the time in its current business year authority; that its gross annual gaming revenue (8) A futures commission merchant; exceeds $1,000,000. (9) An introducing broker in com- (iii) Any reference in this chapter, modities; or other than in this paragraph (t)(5) and (10) A mutual fund. in paragraph (t)(6) of this section, to a (u) Foreign bank. A bank organized casino shall also include a reference to under foreign law, or an agency, branch a card club, unless the provision in or office located outside the United question contains specific language States of a bank. The term does not in- varying its application to card clubs or clude an agent, agency, branch or of- excluding card clubs from its applica- fice within the United States of a bank tion; organized under foreign law.

588

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00598 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.100

(v) Foreign financial agency. A person registered as an introducing broker acting outside the United States for a with the CFTC under the CEA, except person (except for a country, a mone- persons who register pursuant to sec- tary or financial authority acting as a tion 4f(a)(2) of the CEA, 7 U.S.C. monetary or financial authority, or an 6f(a)(2). international financial institution of (cc) Investment security. An instru- which the United States Government is ment which: a member) as a financial institution, (1) Is issued in bearer or registered bailee, depository trustee, or agent, or form; acting in a similar way related to (2) Is of a type commonly dealt in money, credit, securities, gold, or a upon securities exchanges or markets transaction in money, credit, securi- or commonly recognized in any area in ties, or gold. which it is issued or dealt in as a me- (w) Funds transfer. The series of dium for investment; transactions, beginning with the origi- (3) Is either one of a class or series or nator’s payment order, made for the by its terms is divisible into a class or purpose of making payment to the ben- series of instruments; and eficiary of the order. The term includes (4) Evidences a share, participation any payment order issued by the origi- or other interest in property or in an nator’s bank or an intermediary bank enterprise or evidences an obligation of intended to carry out the originator’s the issuer. payment order. A funds transfer is (dd) Monetary instruments. (1) Mone- completed by acceptance by the bene- tary instruments include: ficiary’s bank of a payment order for (i) Currency; the benefit of the beneficiary of the (ii) Traveler’s checks in any form; originator’s payment order. Funds (iii) All negotiable instruments (in- transfers governed by the Electronic cluding personal checks, business Fund Transfer Act of 1978 (Title XX, checks, official bank checks, cashier’s Pub. L. 95–630, 92 Stat. 3728, 15 U.S.C. checks, third-party checks, promissory 1693, et seq.), as well as any other funds notes (as that term is defined in the transfers that are made through an Uniform Commercial Code), and money automated clearinghouse, an auto- orders) that are either in bearer form, mated teller machine, or a point-of- endorsed without restriction, made out sale system, are excluded from this def- to a fictitious payee (for the purposes inition. of § 1010.340), or otherwise in such form (x) Futures commission merchant. Any that title thereto passes upon delivery; person registered or required to be reg- (iv) Incomplete instruments (includ- istered as a futures commission mer- ing personal checks, business checks, chant with the Commodity Futures official bank checks, cashier’s checks, Trading Commission (‘‘CFTC’’) under third-party checks, promissory notes the CEA, except persons who register (as that term is defined in the Uniform pursuant to section 4f(a)(2) of the CEA, Commercial Code), and money orders) 7 U.S.C. 6f(a)(2). signed but with the payee’s name omit- (y) Indian Gaming Regulatory Act. The ted; and Indian Gaming Regulatory Act of 1988, (v) Securities or stock in bearer form codified at 25 U.S.C. 2701–2721 and 18 or otherwise in such form that title U.S.C. 1166–68. thereto passes upon delivery. (z) Intermediary bank. A receiving (2) Monetary instruments do not in- bank other than the originator’s bank clude warehouse receipts or bills of lad- or the beneficiary’s bank. ing. (aa) Intermediary financial institution. (ee) [Reserved] A receiving financial institution, other (ff) Money services business. Each than the transmittor’s financial insti- agent, agency, branch, or office within tution or the recipient’s financial insti- the United States of any person doing tution. The term intermediary finan- business, whether or not on a regular cial institution includes an inter- basis or as an organized business con- mediary bank. cern, in one or more of the capacities (bb) Introducing broker-commodities. listed in paragraphs (ff)(1) through Any person registered or required to be (ff)(6) of this section. Notwithstanding

589

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00599 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.100 31 CFR Ch. X (7–1–11 Edition)

the preceding sentence, the term (B) Any other person engaged as a ‘‘money services business’’ shall not in- business in the transfer of funds. clude a bank, nor shall it include a per- (ii) Facts and circumstance: Limitation. son registered with, and regulated or Whether a person ‘‘engages as a busi- examined by, the Securities and Ex- ness’’ in the activities described in change Commission or the Commodity paragraph (ff)(5)(i) of this section is a Futures Trading Commission. matter of facts and circumstances. (1) Currency dealer or exchanger. A Generally, the acceptance and trans- currency dealer or exchanger (other mission of funds as an integral part of than a person who does not exchange the execution and settlement of a currency in an amount greater than transaction other than the funds trans- $1,000 in currency or monetary or other mission itself (for example, in connec- instruments for any person on any day tion with a bona fide sale of securities in one or more transactions). or other property), will not cause a per- (2) Check casher. A person engaged in son to be a money transmitter within the business of a check casher (other the meaning of paragraph (ff)(5)(i) of than a person who does not cash checks this section. in an amount greater than $1,000 in (6) U.S. Postal Service. The United currency or monetary or other instru- States Postal Service, except with re- ments for any person on any day in one spect to the sale of postage or phila- or more transactions). telic products. (gg) Mutual fund. An ‘‘investment (3) Issuer of traveler’s checks, money or- company’’ (as the term is defined in ders, or stored value. An issuer of trav- section 3 of the Investment Company eler’s checks, money orders, or, stored Act (15 U.S.C. 80a–3)) that is an ‘‘open- value (other than a person who does end company’’ (as that term is defined not issue such checks or money orders in section 5 of the Investment Com- or stored value in an amount greater pany Act (15 U.S.C. 80a–5)) that is reg- than $1,000 in currency or monetary or istered or is required to register with other instruments to any person on the Commission under section 8 of the any day in one or more transactions). Investment Company Act (15 U.S.C. (4) Seller or redeemer of traveler’s 80a–8). checks, money orders, or stored value. A (hh) Option on a commodity. Any seller or redeemer of traveler’s checks, agreement, contract, or transaction de- money orders, or stored value (other scribed in section 1a(26) of the CEA, 7 than a person who does not sell such U.S.C. 1a(26). checks or money orders or stored value (ii) Originator. The sender of the first in an amount greater than $1,000 in payment order in a funds transfer. currency or monetary or other instru- (jj) Originator’s bank. The receiving ments to or redeem such instruments bank to which the payment order of for an amount greater than $1,000 in the originator is issued if the origi- currency or monetary or other instru- nator is not a bank or foreign bank, or ments from, any person on any day in the originator if the originator is a one or more transactions). bank or foreign bank. (5) Money transmitter—(i) In general. (kk) Payment date. The day on which Money transmitter: the amount of the transmittal order is (A) Any person, whether or not li- payable to the recipient by the recipi- censed or required to be licensed, who ent’s financial institution. The pay- engages as a business in accepting cur- ment date may be determined by in- rency, or funds denominated in cur- struction of the sender, but cannot be rency, and transmits the currency or earlier than the day the order is re- funds, or the value of the currency or ceived by the recipient’s financial in- funds, by any means through a finan- stitution and, unless otherwise pre- cial agency or institution, a Federal scribed by instruction, is the date the Reserve Bank or other facility of one order is received by the recipient’s fi- or more Federal Reserve Banks, the nancial institution. Board of Governors of the Federal Re- (ll) Payment order. An instruction of a serve System, or both, or an electronic sender to a receiving bank, transmitted funds transfer network; or orally, electronically, or in writing, to

590

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00600 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.100

pay, or to cause another bank or for- tion 3(a)(10) of the Securities Exchange eign bank to pay, a fixed or deter- Act of 1934, 15 U.S.C. 78c(a)(10). minable amount of money to a bene- (tt) Self-regulatory organization: ficiary if: (1) Shall have the same meaning as (1) The instruction does not state a provided in section 3(a)(26) of the Secu- condition to payment to the bene- rities Exchange Act of 1934 (15 U.S.C. ficiary other than time of payment; 78c(a)(26)); and (2) The receiving bank is to be reim- (2) Means a ‘‘registered entity’’ or a bursed by debiting an account of, or ‘‘registered futures association’’ as pro- otherwise receiving payment from, the vided in section 1a(29) or 17, respec- sender; and tively, of the Commodity Exchange Act (3) The instruction is transmitted by (7 U.S.C. 1a(29), 21). the sender directly to the receiving (uu) Sender. The person giving the in- bank or to an agent, funds transfer sys- struction to the receiving financial in- tem, or communication system for stitution. transmittal to the receiving bank. (vv) State. The States of the United (mm) Person. An individual, a cor- States and, wherever necessary to poration, a partnership, a trust or es- carry out the provisions of this chap- tate, a joint stock company, an asso- ter, the District of Columbia. ciation, a syndicate, joint venture, or (ww) Stored value. Funds or monetary other unincorporated organization or value represented in digital electronics group, an Indian Tribe (as that term is format (whether or not specially defined in the Indian Gaming Regu- encrypted) and stored or capable of latory Act), and all entities cognizable storage on electronic media in such a as legal personalities. way as to be retrievable and transfer- (nn) Receiving bank. The bank or for- able electronically. eign bank to which the sender’s in- (xx) Structure (structuring). For pur- struction is addressed. poses of § 1010.314, a person structures a (oo) Receiving financial institution. transaction if that person, acting The financial institution or foreign fi- alone, or in conjunction with, or on be- nancial agency to which the sender’s half of, other persons, conducts or at- instruction is addressed. The term re- tempts to conduct one or more trans- ceiving financial institution includes a actions in currency, in any amount, at receiving bank. one or more financial institutions, on (pp) Recipient. The person to be paid one or more days, in any manner, for by the recipient’s financial institution. the purpose of evading the reporting The term recipient includes a bene- requirements under §§ 1010.311, 1010.313, ficiary, except where the recipient’s fi- 1020.315, 1021.311 and 1021.313 of this nancial institution is a financial insti- chapter. ‘‘In any manner’’ includes, but tution other than a bank. is not limited to, the breaking down of (qq) Recipient’s financial institution. a single sum of currency exceeding The financial institution or foreign fi- $10,000 into smaller sums, including nancial agency identified in a trans- sums at or below $10,000, or the conduct mittal order in which an account of the of a transaction, or series of currency recipient is to be credited pursuant to transactions at or below $10,000. The the transmittal order or which other- transaction or transactions need not wise is to make payment to the recipi- exceed the $10,000 reporting threshold ent if the order does not provide for at any single financial institution on payment to an account. The term re- any single day in order to constitute cipient’s financial institution includes structuring within the meaning of this a beneficiary’s bank, except where the definition. beneficiary is a recipient’s financial in- (yy) Taxpayer Identification Number. stitution. Taxpayer Identification Number (rr) Secretary. The Secretary of the (‘‘TIN’’) is defined by section 6109 of Treasury or any person duly authorized the Internal Revenue Code of 1986 (26 by the Secretary to perform the func- U.S.C. 6109) and the Internal Revenue tion mentioned. Service regulations implementing that (ss) Security. Security means any in- section (e.g., social security number or strument or interest described in sec- employer identification number).

591

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00601 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.100 31 CFR Ch. X (7–1–11 Edition)

(zz) Territories and Insular Possessions. cludes any transmittal order issued by The Commonwealth of Puerto Rico, the the transmittor’s financial institution United States Virgin Islands, Guam, or an intermediary financial institu- the Commonwealth of the Northern tion intended to carry out the Mariana Islands, and all other terri- transmittor’s transmittal order. The tories and possessions of the United term transmittal of funds includes a States other than the Indian lands and funds transfer. A transmittal of funds the District of Columbia. is completed by acceptance by the re- (aaa) [Reserved] cipient’s financial institution of a (bbb) Transaction. (1) Except as pro- transmittal order for the benefit of the vided in paragraph (bbb)(2) of this sec- recipient of the transmittor’s trans- tion, transaction means a purchase, mittal order. Funds transfers governed sale, loan, pledge, gift, transfer, deliv- by the Electronic Fund Transfer Act of ery, or other disposition, and with re- 1978 (Title XX, Pub. L. 95–630, 92 Stat. spect to a financial institution includes 3728, 15 U.S.C. 1693, et seq.), as well as a deposit, withdrawal, transfer between any other funds transfers that are accounts, exchange of currency, loan, made through an automated clearing- extension of credit, purchase or sale of house, an automated teller machine, or any stock, bond, certificate of deposit, a point-of-sale system, are excluded or other monetary instrument, secu- from this definition. rity, contract of sale of a commodity (eee) Transmittal order. The term for future delivery, option on any con- transmittal order includes a payment tract of sale of a commodity for future order and is an instruction of a sender delivery, option on a commodity, pur- to a receiving financial institution, chase or redemption of any money transmitted orally, electronically, or order, payment or order for any money in writing, to pay, or cause another fi- remittance or transfer, purchase or re- nancial institution or foreign financial demption of casino chips or tokens, or agency to pay, a fixed or determinable other gaming instruments or any other amount of money to a recipient if: payment, transfer, or delivery by, (1) The instruction does not state a through, or to a financial institution, condition to payment to the recipient by whatever means effected. other than time of payment; (2) For purposes of §§ 1010.311, 1010.313, (2) The receiving financial institu- 1020.315, 1021.311, 1021.313, and other tion is to be reimbursed by debiting an provisions of this chapter relating sole- account of, or otherwise receiving pay- ly to the report required by those sec- ment from, the sender; and tions, the term ‘‘transaction in cur- (3) The instruction is transmitted by rency’’ shall mean a transaction in- the sender directly to the receiving fi- volving the physical transfer of cur- nancial institution or to an agent or rency from one person to another. A communication system for transmittal transaction which is a transfer of funds to the receiving financial institution. by means of bank check, bank draft, (fff) Transmittor. The sender of the wire transfer, or other written order, first transmittal order in a transmittal and which does not include the phys- of funds. The term transmittor in- ical transfer of currency, is not a cludes an originator, except where the transaction in currency for this pur- transmittor’s financial institution is a pose. financial institution or foreign finan- (ccc) Transaction account. Trans- cial agency other than a bank or for- action accounts include those accounts eign bank. described in 12 U.S.C. 461(b)(1)(C), (ggg) Transmittor’s financial institu- money market accounts and similar tion. The receiving financial institu- accounts that take deposits and are tion to which the transmittal order of subject to withdrawal by check or the transmittor is issued if the other negotiable order. transmittor is not a financial institu- (ddd) Transmittal of funds. A series of tion or foreign financial agency, or the transactions beginning with the transmittor if the transmittor is a fi- transmittor’s transmittal order, made nancial institution or foreign financial for the purpose of making payment to agency. The term transmittor’s finan- the recipient of the order. The term in- cial institution includes an originator’s

592

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00602 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.220

bank, except where the originator is a cerning the establishment of anti- transmittor’s financial institution money laundering programs: other than a bank or foreign bank. (i) Pawnbroker; (hhh) United States. The States of the (ii) Loan or finance company; United States, the District of Colum- (iii) Travel agency; bia, the Indian lands (as that term is (iv) Telegraph company; defined in the Indian Gaming Regu- (v) Seller of vehicles, including auto- latory Act), and the Territories and In- mobiles, airplanes, and boats; sular Possessions of the United States. (vi) Person involved in real estate (iii) U.S. person. (1) A United States closings and settlements; citizen; or (2) A person other than an (vii) Private banker; individual (such as a corporation, part- (viii) Commodity pool operator; nership or trust), that is established or (ix) Commodity trading advisor; or organized under the laws of a State or (x) Investment company. the United States. Non-U.S. person (2) Subject to the provisions of para- means a person that is not a U.S. per- graphs (c) and (d) of this section, a son. bank (as defined in § 1010.100(d)) that is (jjj) U.S. Postal Service. The United not subject to regulation by a Federal States Postal Service, except with re- functional regulator (as defined in spect to the sale of postage or phila- § 1010.100(r)) is exempt from the require- telic products. ment in 31 U.S.C. 5318(h)(1) concerning the establishment of anti-money laun- Subpart B—Programs dering programs. (3) Subject to the provisions of para- § 1010.200 General. graphs (c) and (d) of this section, a per- Each financial institution (as defined son described in § 1010.100(t)(7) is ex- in 31 U.S.C. 5312(a)(2) or (c)(1)) should empt from the requirement in 31 U.S.C. refer to subpart B of its chapter X Part 5318(h)(1) concerning the establishment for any additional program require- of anti-money laundering programs. ments. Unless otherwise indicated, the (c) Limitation on exemption. The ex- program requirements contained in emptions described in paragraph (b) of this subpart B apply to all financial in- this section shall not apply to any fi- stitutions (as defined in 31 U.S.C. nancial institution that is otherwise 5312(a)(2) or (c)(1)). required to establish an anti-money laundering program by this chapter. § 1010.205 Exempted anti-money laun- (d) Compliance obligations of deferred dering programs for certain finan- financial institutions. Nothing in this cial institutions. section shall be deemed to relieve an (a) Exempt financial institutions. Sub- exempt financial institution from its ject to the provisions of paragraphs (c) responsibility to comply with any and (d) of this section, the following fi- other applicable requirement of law or nancial institutions (as defined in 31 regulation, including title 31 of the U.S.C. 5312(a)(2) or (c)(1)) are exempt U.S.C. and this chapter. from the requirement in 31 U.S.C. 5318(h)(1) concerning the establishment § 1010.210 Anti-money laundering pro- of anti-money laundering programs: grams. (1) An agency of the United States Each financial institution (as defined Government, or of a State or local gov- in 31 U.S.C. 5312(a)(2) or (c)(1)) should ernment, carrying out a duty or power refer to subpart B of its chapter X part of a business described in 31 U.S.C. for any additional anti-money laun- 5312(a)(2); and dering program requirements. (2) [Reserved] (b) Temporary exemption for certain fi- § 1010.220 Customer identification pro- nancial institutions. (1) Subject to the gram requirements. provisions of paragraphs (c) and (d) of Each financial institution (as defined this section, the following financial in- in 31 U.S.C. 5312(a)(2) or (c)(1)) should stitutions (as defined in 31 U.S.C. refer to subpart B of its chapter X part 5312(a)(2) or (c)(1)) are exempt from the for any additional customer identifica- requirement in 31 U.S.C. 5318(h)(1) con- tion program requirements.

593

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00603 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.300 31 CFR Ch. X (7–1–11 Edition)

Subpart C—Reports Required To parting from the United States, may be Be Made filed by mail on or before the date of entry, departure, mailing or shipping. § 1010.300 General. All reports required by § 1010.340(b) may Each financial institution (as defined also be filed by mail. Reports filed by in 31 U.S.C. 5312(a)(2) or (c)(1)) should mail shall be addressed to the Commis- refer to its chapter X part for any addi- sioner of Customs and Border Protec- tional reporting requirements. Unless tion, Attention: Currency Transpor- otherwise indicated, the reporting re- tation Reports, Washington, DC 20229. quirements contained in this subpart C (c) Reports required to be filed by apply to all financial institutions. § 1010.350 shall be filed with the Com- missioner of Internal Revenue on or be- § 1010.301 Determination by the Sec- fore June 30 of each calendar year with retary. respect to foreign financial accounts The Secretary hereby determines exceeding $10,000 maintained during that the reports required by this chap- the previous calendar year. ter have a high degree of usefulness in (d) Reports required by § 1010.311, criminal, tax, or regulatory investiga- § 1010.313, § 1010.340, § 1010.350, § 1020.315, tions or proceedings. § 1021.311 or § 1021.313 of this chapter § 1010.305 [Reserved] shall be filed on forms prescribed by the Secretary. All information called § 1010.306 Filing of reports. for in such forms shall be furnished. (a)(1) A report required by § 1010.311 (e) Forms to be used in making the or § 1021.311, shall be filed by the finan- reports required by § 1010.311, § 1010.313, cial institution within 15 days fol- § 1010.350, § 1020.315, § 1021.311 or § 1021.313 lowing the day on which the reportable of this chapter may be obtained from transaction occurred. the Internal Revenue Service. Forms to (2) A copy of each report filed pursu- be used in making the reports required ant to §§ 1010.311, 1010.313, 1020.315, by § 1010.340 may be obtained from the 1021.311 and 1021.313, shall be retained U.S. Customs and Border Protection. by the financial institution for a period of five years from the date of the re- § 1010.310 Reports of transactions in port. currency. (3) All reports required to be filed by §§ 1010.311, 1010.313, 1020.315, 1021.311 and Sections 1010.310 through 1010.314 set 1021.313, shall be filed with the Com- forth the rules for the reporting by fi- missioner of Internal Revenue, unless nancial institutions of transactions in otherwise specified. currency. Unless otherwise indicated, (b)(1) A report required by the transactions in currency reporting § 1010.340(a) shall be filed at the time of requirements in §§ 1010.310 through entry into the United States or at the 1010.314 apply to all financial institu- time of departure, mailing or shipping tions. Each financial institution should from the United States, unless other- refer to subpart C of its chapter X part wise specified by the Commissioner of for any additional transactions in cur- Customs and Border Protection. rency reporting requirements. (2) A report required by § 1010.340(b) shall be filed within 15 days after re- § 1010.311 Filing obligations for re- ceipt of the currency or other mone- ports of transactions in currency. tary instruments. Each financial institution other than (3) All reports required by § 1010.340 a casino shall file a report of each de- shall be filed with the Customs officer posit, withdrawal, exchange of cur- in charge at any port of entry or depar- rency or other payment or transfer, by, ture, or as otherwise specified by the through, or to such financial institu- Commissioner of Customs and Border tion which involves a transaction in Protection. Reports required by § 1010.340(a) for currency or other mone- currency of more than $10,000, except tary instruments not physically ac- as otherwise provided in this section. companying a person entering or de- In the case of the U.S. Postal Service,

594

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00604 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.320

the obligation contained in the pre- in currency reporting requirements in ceding sentence shall not apply to pay- this chapter. ments or transfers made solely in con- (b) Multiple transactions. In the case nection with the purchase of postage or of financial institutions other than ca- philatelic products. sinos, for purposes of the transactions in currency reporting requirements in § 1010.312 Identification required. this chapter, multiple currency trans- Before concluding any transaction actions shall be treated as a single with respect to which a report is re- transaction if the financial institution quired under § 1010.311, § 1010.313, has knowledge that they are by or on § 1020.315, § 1021.311 or § 1021.313 of this behalf of any person and result in ei- chapter, a financial institution shall ther cash in or cash out totaling more verify and record the name and address than $10,000 during any one business of the individual presenting a trans- day (or in the case of the U.S. Postal action, as well as record the identity, Service, any one day). Deposits made account number, and the social secu- at night or over a weekend or holiday rity or taxpayer identification number, shall be treated as if received on the next business day following the de- if any, of any person or entity on whose posit. behalf such transaction is to be ef- fected. Verification of the identity of § 1010.314 Structured transactions. an individual who indicates that he or she is an alien or is not a resident of No person shall for the purpose of the United States must be made by evading the transactions in currency passport, alien identification card, or reporting requirements of this chapter other official document evidencing na- with respect to such transaction: (a) Cause or attempt to cause a do- tionality or residence (e.g., a Provin- mestic financial institution to fail to cial driver’s license with indication of file a report required under the trans- home address). Verification of identity actions in currency reporting require- in any other case shall be made by ex- ments of this chapter; amination of a document, other than a (b) Cause or attempt to cause a do- bank signature card, that is normally mestic financial institution to file a re- acceptable within the banking commu- port required under the transactions in nity as a means of identification when currency reporting requirements of cashing checks for nondepositors (e.g., this chapter that contains a material a driver’s license or credit card). A omission or misstatement of fact; or bank signature card may be relied upon (c) Structure (as that term is defined only if it was issued after documents in § 1010.100(xx)) or assist in struc- establishing the identity of the indi- turing, or attempt to structure or as- vidual were examined and notation of sist in structuring, any transaction the specific information was made on with one or more domestic financial in- the signature card. In each instance, stitutions. the specific identifying information (i.e., the account number of the credit § 1010.315 Exemptions for non-bank fi- card, the driver’s license number, etc.) nancial institutions. used in verifying the identity of the A non-bank financial institution is customer shall be recorded on the re- not required to file a report otherwise port, and the mere notation of ‘‘known required by § 1010.311 with respect to a customer’’ or ‘‘bank signature card on transaction in currency between the file’’ on the report is prohibited. institution and a commercial bank.

§ 1010.313 Aggregation. § 1010.320 Reports of suspicious trans- (a) Multiple branches. A financial in- actions. stitution includes all of its domestic Each financial institution (as defined branch offices, and any recordkeeping in 31 U.S.C. 5312(a)(2) or (c)(1)) should facility, wherever located, that con- refer to subpart C of its financial insti- tains records relating to the trans- tution part in this chapter for any ad- actions of the institution’s domestic ditional suspicious transaction report- offices, for purposes of the transactions ing requirements.

595

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00605 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.330 31 CFR Ch. X (7–1–11 Edition)

§ 1010.330 Reports relating to currency of the currency within 15 days in a cur- in excess of $10,000 received in a rency transaction (the ‘‘second cur- trade or business. rency transaction’’) which is reportable (a) Reporting requirement—(1) Report- under section 5312 of title 31, or 31 able transactions—(i) In general. Any U.S.C. 5331 and this section, and who person (solely for purposes of section discloses the name, address, and TIN of 5331 of title 31, United States Code and the principal to the recipient in the this section, ‘‘person’’ shall have the second currency transaction need not same meaning as under 26 report the initial receipt of currency U.S.C.7701(a)(1)) who, in the course of a under this section. An agent will be trade or business in which such person deemed to have met the disclosure re- is engaged, receives currency in excess quirements of this paragraph (a)(3)(ii) of $10,000 in 1 transaction (or 2 or more if the agent discloses only the name of related transactions) shall, except as the principal and the agent knows that otherwise provided, make a report of the recipient has the principal’s ad- information with respect to the receipt dress and taxpayer identification num- of currency. This section does not ber. apply to amounts received in a trans- (iii) Example. The following example action reported under 31 U.S.C. 5313 and illustrates the application of the rules § 1010.311, § 1010.313, § 1020.315, § 1021.311 in paragraphs (a)(3)(i) and (ii) of this or § 1021.313 of this chapter. section: (ii) Certain financial transactions. Sec- Example. B, the principal, gives D, an at- tion 6050I of title 26 of the United torney, $75,000 in currency to purchase real States Code requires persons to report property on behalf of B. Within 15 days D information about financial trans- purchases real property for currency from E, actions to the IRS, and 31 U.S.C. 5331 a real estate developer, and discloses to E, requires persons to report similar in- B’s name, address, and taxpayer identifica- tion number. Because the transaction quali- formation about certain transactions fies for the exception provided in paragraph to FinCEN. This information shall be (a)(3)(ii) of this section, D need not report reported on the same form as pre- with respect to the initial receipt of cur- scribed by the Secretary. rency under this section. The exception does (2) Currency received for the account of not apply, however, if D pays E by means another. Currency in excess of $10,000 other than currency, or effects the purchase received by a person for the account of more than 15 days following receipt of the another must be reported under this currency from B, or fails to disclose B’s name, address, and taxpayer identification section. Thus, for example, a person number (assuming D does not know that E who collects delinquent accounts re- already has B’s address and taxpayer identi- ceivable for an automobile dealer must fication number), or purchases the property report with respect to the receipt of from a person whose sale of the property is currency in excess of $10,000 from the not in the course of that person’s trade or collection of a particular account even business. In any such case, D is required to though the proceeds of the collection report the receipt of currency from B under are credited to the account of the auto- this section. mobile dealer (i.e., where the rights to (b) Multiple payments. The receipt of the proceeds from the account are re- multiple currency deposits or currency tained by the automobile dealer and installment payments (or other similar the collection is made on a fee-for-serv- payments or prepayments) relating to ice basis). a single transaction (or two or more re- (3) Currency received by agents— (i) lated transactions), is reported as set General rule. Except as provided in forth in paragraphs (b)(1) through (b)(3) paragraph (a)(3)(ii) of this section, a of this section. person who in the course of a trade or (1) Initial payment in excess of $10,000. business acts as an agent (or in some If the initial payment exceeds $10,000, other similar capacity) and receives the recipient must report the initial currency in excess of $10,000 from a payment within 15 days of its receipt. principal must report the receipt of (2) Initial payment of $10,000 or less. If currency under this section. the initial payment does not exceed (ii) Exception. An agent who receives $10,000, the recipient must aggregate currency from a principal and uses all the initial payment and subsequent

596

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00606 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.330

payments made within one year of the which circulate in and are customarily initial payment until the aggregate used and accepted as money in the amount exceeds $10,000, and report with country in which issued; and respect to the aggregate amount with- (ii) A cashier’s check (by whatever in 15 days after receiving the payment name called, including ‘‘treasurer’s that causes the aggregate amount to check’’ and ‘‘bank check’’), bank draft, exceed $10,000. traveler’s check, or money order hav- (3) Subsequent payments. In addition ing a face amount of not more than to any other required report, a report $10,000— must be made each time that pre- (A) Received in a designated report- viously unreportable payments made ing transaction as defined in paragraph within a 12-month period with respect (c)(2) of this section (except as provided to a single transaction (or two or more in paragraphs (c)(3), (4), and (5) of this related transactions), individually or in the aggregate, exceed $10,000. The re- section), or port must be made within 15 days after (B) Received in any transaction in receiving the payment in excess of which the recipient knows that such $10,000 or the payment that causes the instrument is being used in an attempt aggregate amount received in the 12- to avoid the reporting of the trans- month period to exceed $10,000. (If more action under section 5331 and this sec- than one report would otherwise be re- tion. quired for multiple currency payments (2) Designated reporting transaction. A within a 15-day period that relate to a designated reporting transaction is a single transaction (or two or more re- retail sale (or the receipt of funds by a lated transactions), the recipient may broker or other intermediary in con- make a single combined report with re- nection with a retail sale) of— spect to the payments. The combined (i) A consumer durable, report must be made no later than the (ii) A collectible, or date by which the first of the separate (iii) A travel or entertainment activ- reports would otherwise be required to ity. be made.) (3) Exception for certain . A cash- (4) Example. The following example il- ier’s check, bank draft, traveler’s lustrates the application of the rules in check, or money order received in a paragraphs (b)(1) through (b)(3) of this designated reporting transaction is not section: treated as currency pursuant to para- Example. On January 10, Year 1, M receives graph (c)(1)(ii)(A) of this section if the an initial payment in currency of $11,000 instrument constitutes the proceeds of with respect to a transaction. M receives a loan from a bank. The recipient may subsequent payments in currency with re- rely on a copy of the loan document, a spect to the same transaction of $4,000 on February 15, Year 1, $6,000 on March 20, Year written statement from the bank, or 1, and $12,000 on May 15, Year 1. M must similar documentation (such as a writ- make a report with respect to the payment ten lien instruction from the issuer of received on January 10, Year 1, by January the instrument) to substantiate that 25, Year 1. M must also make a report with the instrument constitutes loan pro- respect to the payments totaling $22,000 re- ceeds. ceived from February 15, Year 1, through May 15, Year 1. This report must be made by (4) Exception for certain installment May 30, Year 1, that is, within 15 days of the sales. A cashier’s check, bank draft, date that the subsequent payments, all of traveler’s check, or money order re- which were received within a 12-month pe- ceived in a designated reporting trans- riod, exceeded $10,000. action is not treated as currency pur- (c) Meaning of terms. The following suant to paragraph (c)(1)(ii)(A) of this definitions apply for purposes of this section if the instrument is received in section— payment on a promissory note or an in- (1) Currency. Solely for purposes of 31 stallment sales contract (including a U.S.C. 5331 and this section, currency lease that is considered to be a sale for means— Federal income tax purposes). How- (i) The coin and currency of the ever, the preceding sentence applies United States or of any other country, only if—

597

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00607 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.330 31 CFR Ch. X (7–1–11 Edition)

(i) Promissory notes or installment a cashier’s check payable to E and Q in the sales contracts with the same or sub- amount of $9,500. The cashier’s check con- stantially similar terms are used in the stitutes the proceeds of a loan from the bank ordinary course of the recipient’s trade issuing the check. The origin of the proceeds is evident from provisions inserted by the or business in connection with sales to bank on the check that instruct the dealer ultimate consumers; and to cause a lien to be placed on the vehicle as (ii) The total amount of payments security for the loan. The sale of the auto- with respect to the sale that are re- mobile is a designated reporting transaction. ceived on or before the 60th day after However, under paragraph (c)(3) of this sec- the date of the sale does not exceed 50 tion, because E has furnished Q documentary percent of the purchase price of the information establishing that the cashier’s sale. check constitutes the proceeds of a loan (5) Exception for certain down payment from the bank issuing the check, the cash- ier’s check is not treated as currency pursu- plans. A cashier’s check, bank draft, ant to paragraph (c)(1)(ii)(A) of this section. traveler’s check, or money order re- Example 3. F, an individual, purchases an ceived in a designated reporting trans- item of jewelry from S, a retail jeweler, for action is not treated as currency pur- $12,000. F gives S traveler’s checks totaling suant to paragraph (c)(1)(ii)(A) of this $2,400 and pays the balance with a personal section if the instrument is received check payable to S in the amount of $9,600. pursuant to a payment plan requiring Because the sale is a designated reporting one or more down payments and the transaction, the traveler’s checks are treat- payment of the balance of the purchase ed as currency for purposes of section 5331 and this section. However, because the per- price by a date no later than the date sonal check is not treated as currency for of the sale (in the case of an item of purposes of section 5331 and this section, S travel or entertainment, a date no has not received more than $10,000 in cur- later than the earliest date that any rency in the transaction and no report is re- item of travel or entertainment per- quired to be filed under section 5331 and this taining to the same trip or event is fur- section. nished). However, the preceding sen- Example 4. G, an individual, purchases a tence applies only if— boat from T, a boat dealer, for $16,500. G pays (i) The recipient uses payment plans T with a cashier’s check payable to T in the amount of $16,500. The cashier’s check is not with the same or substantially similar treated as currency because the face amount terms in the ordinary course of its of the check is more than $10,000. Thus, no trade or business in connection with report is required to be made by T under sec- sales to ultimate consumers; and tion 5331 and this section. (ii) The instrument is received more Example 5. H, an individual, arranges with than 60 days prior to the date of the W, a travel agent, for the chartering of a pas- sale (in the case of an item of travel or senger aircraft to transport a group of indi- entertainment, the date on which the viduals to a sports event in another city. H final payment is due). also arranges with W for hotel accommoda- tions for the group and for admission tickets (6) Examples. The following examples to the sports event. In payment, H tenders to illustrate the definition of ‘‘currency’’ W money orders which H had previously pur- set forth in paragraphs (c)(1) through chased. The total amount of the money or- (c)(5) of this section: ders, none of which individually exceeds $10,000 in face amount, exceeds $10,000. Be- Example 1. D, an individual, purchases gold cause the transaction is a designated report- coins from M, a coin dealer, for $13,200. D ing transaction, the money orders are treat- tenders to M in payment United States cur- ed as currency for purposes of section 5331 rency in the amount of $6,200 and a cashier’s and this section. Therefore, because W has check in the face amount of $7,000 which D had purchased. Because the sale is a des- received more than $10,000 in currency with ignated reporting transaction, the cashier’s respect to the transaction, W must make the check is treated as currency for purposes of report required by section 5331 and this sec- 31 U.S.C. 5331 and this section. Therefore, be- tion. cause M has received more than $10,000 in (7) Consumer durable. The term con- currency with respect to the transaction, M sumer durable means an item of tan- must make the report required by 31 U.S.C. gible personal property of a type that 5331 and this section. Example 2. E, an individual, purchases an is suitable under ordinary usage for automobile from Q, an automobile dealer, for personal consumption or use, that can $11,500. E tenders to Q in payment United reasonably be expected to be useful for States currency in the amount of $2,000 and at least 1 year under ordinary usage,

598

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00608 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.330

and that has a sales price of more than Additionally, transactions conducted $10,000. Thus, for example, a $20,000 between a payer (or its agent) and a automobile is a consumer durable currency recipient during a period of (whether or not it is sold for business more than 24 hours are related if the use), but a $20,000 dump truck or a recipient knows or has reason to know $20,000 factory machine is not. that each transaction is one of a series (8) Collectible. The term collectible of connected transactions. means an item described in paragraphs (iii) The following examples illus- (A) through (D) of section 408 (m)(2) of trate the definition of paragraphs title 26 of the United States Code (de- (c)(12)(i) and (ii) of this section: termined without regard to section 408 Example 1. A person has a tacit agreement (m)(3) of title 26 of the United States with a gold dealer to purchase $36,000 in gold Code). bullion. The $36,000 purchase represents a (9) Travel or entertainment activity. single transaction under paragraph (c)(12)(i) The term travel or entertainment activity of this section and the reporting require- means an item of travel or entertain- ments of this section cannot be avoided by ment (within the meaning of 26 CFR recasting the single sales transaction into 4 separate $9,000 sales transactions. 1.274–2(b)(1)) pertaining to a single trip Example 2. An attorney agrees to represent or event where the aggregate sales a client in a criminal case with the attor- price of the item and all other items ney’s fee to be determined on an hourly pertaining to the same trip or event basis. In the first month in which the attor- that are sold in the same transaction ney represents the client, the bill for the at- (or related transactions) exceeds torney’s services comes to $8,000 which the $10,000. client pays in currency. In the second month in which the attorney represents the client, (10) Retail sale. The term retail sale the bill for the attorney’s services comes to means any sale (whether for resale or $4,000, which the client again pays in cur- for any other purpose) made in the rency. The aggregate amount of currency course of a trade or business if that paid ($12,000) relates to a single transaction trade or business principally consists as defined in paragraph (c)(12)(i) of this sec- of making sales to ultimate consumers. tion, the sale of legal services relating to the (11) Trade or business. The term trade criminal case, and the receipt of currency must be reported under this section. or business has the same meaning as Example 3. A person intends to contribute a under section 162 of title 26, United total of $45,000 to a trust fund, and the trust- States Code. ee of the fund knows or has reason to know (12) Transaction. (i) Solely for pur- of that intention. The $45,000 contribution is poses of 31 U.S.C. 5331 and this section, a single transaction under paragraph the term transaction means the under- (c)(12)(i) of this section and the reporting re- lying event precipitating the payer’s quirement of this section cannot be avoided transfer of currency to the recipient. In by the grantor’s making five separate $9,000 contributions of currency to a single fund or this context, transactions include (but by making five $9,000 contributions of cur- are not limited to) a sale of goods or rency to five separate funds administered by services; a sale of real property; a sale a common trustee. of intangible property; a rental of real Example 4. K, an individual, attends a one or personal property; an exchange of day auction and purchases for currency two currency for other currency; the estab- items, at a cost of $9,240 and $1,732.50 respec- lishment or maintenance of or con- tively (tax and buyer’s premium included). tribution to a custodial, trust, or es- Because the transactions are related trans- actions as defined in paragraph (c)(12)(ii) of crow arrangement; a payment of a pre- this section, the auction house is required to existing debt; a conversion of currency report the aggregate amount of currency re- to a negotiable instrument; a reim- ceived from the related sales ($10,972.50), bursement for expenses paid; or the even though the auction house accounts sep- making or repayment of a loan. A arately on its books for each item sold and transaction may not be divided into presents the purchaser with separate bills for multiple transactions in order to avoid each item purchased. reporting under this section. Example 5. F, a coin dealer, sells for cur- rency $9,000 worth of gold coins to an indi- (ii) The term related transactions vidual on three successive days. Under para- means any transaction conducted be- graph (c)(12)(ii) of this section the three tween a payer (or its agent) and a re- $9,000 transactions are related transactions cipient of currency in a 24-hour period. aggregating $27,000 if F knows, or has reason

599

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00609 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.330 31 CFR Ch. X (7–1–11 Edition)

to know, that each transaction is one of a se- there is no requirement to report with ries of connected transactions. respect to a currency transaction if the (13) Recipient. (i) The term recipient entire transaction occurs outside the means the person receiving the cur- United States (the fifty states and the rency. Except as provided in paragraph District of Columbia). An entire trans- (c)(13)(ii) of this section, each store, di- action consists of both the transaction vision, branch, department, head- as defined in paragraph (c)(12)(i) of this quarters, or office (‘‘branch’’) (regard- section and the receipt of currency by less of physical location) comprising a the recipient. If, however, any part of portion of a person’s trade or business an entire transaction occurs in the shall for purposes of this section be Commonwealth of Puerto Rico or a deemed a separate recipient. possession or territory of the United (ii) A branch that receives currency States and the recipient of currency in payments will not be deemed a sepa- that transaction is subject to the gen- rate recipient if the branch (or a cen- eral jurisdiction of the Internal Rev- tral unit linking such branch with enue Service under title 26 of the other branches) would in the ordinary United States Code, the recipient is re- course of business have reason to know quired to report the transaction under the identity of payers making currency this section. payments to other branches of such (ii) Example. The following example person. illustrates the application of the rules (iii) Examples. The following exam- in paragraph (d)(1)(i) of this section: ples illustrate the application of the rules in paragraphs (c)(13)(i) and (ii) of Example. W, an individual engaged in the trade or business of selling aircraft, reaches this section: an agreement to sell an airplane to a U.S. Example 1. N, an individual, purchases reg- citizen living in Mexico. The agreement, no ulated futures contracts at a cost of $7,500 portion of which is formulated in the United and $5,000, respectively, through two dif- States, calls for a purchase price of $125,000 ferent branches of Commodities Broker X on and requires delivery of and payment for the the same day. N pays for each purchase with airplane to be made in Mexico. Upon delivery currency. Each branch of Commodities of the airplane in Mexico, W receives $125,000 Broker X transmits the sales information re- in currency. W is not required to report garding each of N’s purchases to a central under 31 U.S.C. 5331 or this section because unit of Commodities Broker X (which settles the exception provided in paragraph (d)(1)(i) the transactions against N’s account). Under of this section (‘‘foreign transaction excep- paragraph (c)(13)(ii) of this section the sepa- tion’’) applies. If, however, any part of the rate branches of Commodities Broker X are agreement to sell had been formulated in the not deemed to be separate recipients; there- United States, the foreign transaction excep- fore, Commodities Broker X must report tion would not apply and W would be re- with respect to the two related regulated fu- quired to report the receipt of currency tures contracts sales in accordance with this under 31 U.S.C. 5331 and this section. section. Example 2. P, a corporation, owns and oper- (2) Receipt of currency not in the course ates a racetrack. P’s racetrack contains 100 of the recipient’s trade or business. The betting windows at which pari-mutuel wa- receipt of currency in excess of $10,000 gers may be made. R, an individual, places by a person other than in the course of currency wagers of $3,000 each at five sepa- the person’s trade or business is not re- rate betting windows. Assuming that in the portable under 31 U.S.C. 5331. Thus, for ordinary course of business each betting win- example, F, an individual in the trade dow (or a central unit linking windows) does not have reason to know the identity of per- or business of selling real estate, sells sons making wagers at other betting win- a motorboat for $12,000, the purchase dows, each betting window would be deemed price of which is paid in currency. F to be a separate currency recipient under did not use the motorboat in any trade paragraph (c)(13)(i) of this section. As no in- or business in which F was engaged. F dividual recipient received currency in ex- is not required to report under 31 cess of $10,000, no report need be made by P U.S.C. 5331 or this section because the under this section. exception provided in this paragraph (d) Exceptions to the reporting require- (d)(2) applies. ments of 31 U.S.C. 5331—(1) Receipt is (e) Time, manner, and form of report- made with respect to a foreign currency ing—(1) In general. The reports required transaction—(i) In general. Generally, by paragraph (a) of this section must

600

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00610 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.340

be made by filing a Form 8300, as speci- been transported, mailed, or shipped to fied in 26 CFR 1.6050I–1(e)(2). The re- such person from any place outside the ports must be filed at the time and in United States with respect to which a the manner specified in 26 CFR 1.6050I– report has not been filed under para- 1(e)(1) and (3) respectively. graph (a) of this section, whether or (2) Verification. A person making a re- not required to be filed thereunder, port of information under this section shall make a report thereof, stating must verify the identity of the person the amount, the date of receipt, the from whom the reportable currency is form of monetary instruments, and the received. Verification of the identity of person from whom received. a person who purports to be an alien (c) This section shall not require re- must be made by examination of such ports by: person’s passport, alien identification (1) A Federal Reserve; card, or other official document evi- (2) A bank, a foreign bank, or a dencing nationality or residence. broker or dealer in securities, in re- Verification of the identity of any spect to currency or other monetary other person may be made by examina- instruments mailed or shipped through tion of a document normally accept- the postal service or by common car- able as a means of identification when rier; cashing or accepting checks (for exam- (3) A commercial bank or trust com- ple, a driver’s license or a credit card). pany organized under the laws of any In addition, a report will be considered State or of the United States with re- incomplete if the person required to spect to overland shipments of cur- make a report knows (or has reason to rency or monetary instruments shipped know) that an agent is conducting the to or received from an established cus- transaction for a principal, and the re- tomer maintaining a deposit relation- turn does not identify both the prin- ship with the bank, in amounts which cipal and the agent. the bank may reasonably conclude do (3) Retention of reports. A person re- not exceed amounts commensurate quired to make a report under this sec- with the customary conduct of the tion must keep a copy of each report business, industry or profession of the filed for five years from the date of fil- customer concerned; ing. (4) A person who is not a citizen or resident of the United States in respect § 1010.340 Reports of transportation of to currency or other monetary instru- currency or monetary instruments. ments mailed or shipped from abroad (a) Each person who physically trans- to a bank or broker or dealer in securi- ports, mails, or ships, or causes to be ties through the postal service or by physically transported, mailed, or common carrier; shipped, or attempts to physically (5) A common carrier of passengers in transport, mail or ship, or attempts to respect to currency or other monetary cause to be physically transported, instruments in the possession of its mailed or shipped, currency or other passengers; monetary instruments in an aggregate (6) A common carrier of goods in re- amount exceeding $10,000 at one time spect to shipments of currency or mon- from the United States to any place etary instruments not declared to be outside the United States, or into the such by the shipper; United States from any place outside (7) A travelers’ check issuer or its the United States, shall make a report agent in respect to the transportation thereof. A person is deemed to have of travelers’ checks prior to their de- caused such transportation, mailing or livery to selling agents for eventual shipping when he aids, abets, counsels, sale to the public; commands, procures, or requests it to (8) By a person with respect to a re- be done by a financial institution or strictively endorsed traveler’s check any other person. that is in the collection and reconcili- (b) Each person who receives in the ation process after the traveler’s check U.S. currency or other monetary in- has been negotiated; struments in an aggregate amount ex- (9) Nor by a person engaged as a busi- ceeding $10,000 at one time which have ness in the transportation of currency,

601

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00611 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.350 31 CFR Ch. X (7–1–11 Edition)

monetary instruments and other com- of ‘‘United States’’ in 26 CFR mercial papers with respect to the 301.7701(b)–1(c)(2)(ii); and transportation of currency or other (3) An entity, including but not lim- monetary instruments overland be- ited to, a corporation, partnership, tween established offices of banks or trust, or limited liability company cre- brokers or dealers in securities and for- ated, organized, or formed under the eign persons. laws of the United States, any State, (d) A transfer of funds through nor- the District of Columbia, the Terri- mal banking procedures which does not tories and Insular Possessions of the involve the physical transportation of United States, or the Indian Tribes. currency or monetary instruments is (c) Types of reportable accounts. For not required to be reported by this sec- purposes of this section— tion. This section does not require that (1) Bank account. The term ‘‘bank ac- more than one report be filed covering count’’ means a savings deposit, de- a particular transportation, mailing or mand deposit, checking, or any other shipping of currency or other monetary account maintained with a person en- instruments with respect to which a gaged in the business of banking. complete and truthful report has been (2) Securities account. The term ‘‘se- filed by a person. However, no person curities account’’ means an account required by paragraph (a) or (b) of this with a person engaged in the business section to file a report shall be excused of buying, selling, holding or trading from liability for failure to do so if, in stock or other securities. fact, a complete and truthful report (3) Other financial account. The term has not been filed. ‘‘other financial account’’ means— (i) An account with a person that is § 1010.350 Reports of foreign financial in the business of accepting deposits as accounts. a financial agency; (a) In general. Each United States (ii) An account that is an insurance person having a financial interest in, or annuity policy with a cash value; or signature or other authority over, a (iii) An account with a person that bank, securities, or other financial ac- acts as a broker or dealer for futures or count in a foreign country shall report options transactions in any commodity such relationship to the Commissioner on or subject to the rules of a com- of Internal Revenue for each year in modity exchange or association; or which such relationship exists and (iv) An account with— shall provide such information as shall (A) Mutual fund or similar pooled fund. be specified in a reporting form pre- A mutual fund or similar pooled fund scribed under 31 U.S.C. 5314 to be filed which issues shares available to the by such persons. The form prescribed general public that have a regular net under section 5314 is the Report of For- asset value determination and regular eign Bank and Financial Accounts redemptions; or (TD–F 90–22.1), or any successor form. (B) Other investment fund. [Reserved] See paragraphs (g)(1) and (g)(2) of this (4) Exceptions for certain accounts. (i) section for a special rule for persons An account of a department or agency with a financial interest in 25 or more of the United States, an Indian Tribe, accounts, or signature or other author- or any State or any political subdivi- ity over 25 or more accounts. sion of a State, or a wholly-owned enti- (b) United States person. For purposes ty, agency or instrumentality of any of of this section, the term ‘‘United the foregoing is not required to be re- States person’’ means— ported. In addition, reporting is not re- (1) A citizen of the United States; quired with respect to an account of an (2) A resident of the United States. A entity established under the laws of resident of the United States is an indi- the United States, of an Indian Tribe, vidual who is a resident alien under 26 of any State, or of any political sub- U.S.C. 7701(b) and the regulations division of any State, or under an thereunder but using the definition of intergovernmental compact between ‘‘United States’’ provided in 31 CFR two or more States or Indian Tribes, 1010.100(hhh) rather than the definition that exercises governmental authority

602

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00612 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.350

on behalf of the United States, an In- (i) A person acting as an agent, nomi- dian Tribe, or any such State or polit- nee, attorney or in some other capacity ical subdivision. For this purpose, an on behalf of the United States person entity generally exercises govern- with respect to the account; mental authority on behalf of the (ii) A corporation in which the United States, an Indian Tribe, a United States person owns directly or State, or a political subdivision only if indirectly more than 50 percent of the its authorities include one or more of voting power or the total value of the the powers to tax, to exercise the shares, a partnership in which the power of eminent domain, or to exer- United States person owns directly or cise police powers with respect to mat- indirectly more than 50 percent of the ters within its jurisdiction. interest in profits or capital, or any (ii) An account of an international fi- other entity (other than an entity in nancial institution of which the United paragraphs (e)(2)(iii) through (iv) of States government is a member is not this section) in which the United required to be reported. States person owns directly or indi- (iii) An account in an institution rectly more than 50 percent of the vot- known as a ‘‘United States military ing power, total value of the equity in- banking facility’’ (or ‘‘United States terest or assets, or interest in profits; military finance facility’’) operated by (iii) A trust, if the United States per- a United States financial institution son is the trust grantor and has an designated by the United States Gov- ownership interest in the trust for ernment to serve United States govern- United States Federal tax purposes. See ment installations abroad is not re- 26 U.S.C. 671–679 and the regulations quired to be reported even though the thereunder to determine if a grantor United States military banking facil- has an ownership interest in the trust ity is located in a foreign country. for the year; or (iv) Correspondent or nostro accounts (iv) A trust in which the United that are maintained by banks and used States person either has a present ben- solely for bank-to-bank settlements eficial interest in more than 50 percent are not required to be reported. of the assets or from which such person (d) Foreign country. A foreign country receives more than 50 percent of the includes all geographical areas located current income. outside of the United States as defined (3) Anti-avoidance rule. A United in 31 CFR 1010.100(hhh). States person that causes an entity, in- (e) Financial interest. A financial in- cluding but not limited to a corpora- terest in a bank, securities or other fi- tion, partnership, or trust, to be cre- nancial account in a foreign country ated for a purpose of evading this sec- means an interest described in this tion shall have a financial interest in paragraph (e): any bank, securities, or other financial (1) Owner of record or holder of legal account in a foreign country for which title. A United States person has a fi- the entity is the owner of record or nancial interest in each bank, securi- holder of legal title. ties or other financial account in a for- (f) Signature or other authority—(1) In eign country for which he is the owner general. Signature or other authority of record or has legal title whether the means the authority of an individual account is maintained for his own ben- (alone or in conjunction with another) efit or for the benefit of others. If an to control the disposition of money, account is maintained in the name of funds or other assets held in a financial more than one person, each United account by direct communication States person in whose name the ac- (whether in writing or otherwise) to count is maintained has a financial in- the person with whom the financial ac- terest in that account. count is maintained. (2) Other financial interest. A United (2) Exceptions—(i) An officer or em- States person has a financial interest ployee of a bank that is examined by in each bank, securities or other finan- the Office of the Comptroller of the cial account in a foreign country for Currency, the Board of Governors of which the owner of record or holder of the Federal Reserve System, the Fed- legal title is— eral Deposit Insurance Corporation,

603

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00613 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.350 31 CFR Ch. X (7–1–11 Edition)

the Office of Thrift Supervision, or the registered) under section 12(g) of the National Credit Union Administration Securities Exchange Act need not re- need not report that he has signature port that he has signature or other au- or other authority over a foreign finan- thority over the foreign financial ac- cial account owned or maintained by counts of such entity or if he has no fi- the bank if the officer or employee has nancial interest in the accounts. no financial interest in the account. (g) Special rules—(1) Financial interest (ii) An officer or employee of a finan- in 25 or more foreign financial accounts. cial institution that is registered with A United States person having a finan- and examined by the Securities and Ex- cial interest in 25 or more foreign fi- change Commission or Commodity Fu- nancial accounts need only provide the tures Trading Commission need not re- number of financial accounts and cer- port that he has signature or other au- thority over a foreign financial ac- tain other basic information on the re- count owned or maintained by such fi- port, but will be required to provide de- nancial institution if the officer or em- tailed information concerning each ac- ployee has no financial interest in the count when so requested by the Sec- account. retary or his delegate. (iii) An officer or employee of an Au- (2) Signature or other authority over 25 thorized Service Provider need not re- or more foreign financial accounts. A port that he has signature or other au- United States person having signature thority over a foreign financial ac- or other authority over 25 or more for- count owned or maintained by an in- eign financial accounts need only pro- vestment company that is registered vide the number of financial accounts with the Securities and Exchange Com- and certain other basic information on mission if the officer or employee has the report, but will be required to pro- no financial interest in the account. vide detailed information concerning ‘‘Authorized Service Provider’’ means each account when so requested by the an entity that is registered with and Secretary or his delegate. examined by the Securities and Ex- (3) Consolidated reports. An entity change Commission and that provides that is a United States person and services to an investment company which owns directly or indirectly more registered under the Investment Com- than a 50 percent interest in one or pany Act of 1940. more other entities required to report (iv) An officer or employee of an enti- ty with a class of equity securities list- under this section will be permitted to ed (or American depository receipts file a consolidated report on behalf of listed) on any United States national itself and such other entities. securities exchange need not report (4) Participants and beneficiaries in cer- that he has signature or other author- tain retirement plans. Participants and ity over a foreign financial account of beneficiaries in retirement plans under such entity if the officer or employee sections 401(a), 403(a) or 403(b) of the has no financial interest in the ac- Internal Revenue Code as well as own- count. An officer or employee of a ers and beneficiaries of individual re- United States subsidiary of a United tirement accounts under section 408 of States entity with a class of equity se- the Internal Revenue Code or Roth curities listed on a United States na- IRAs under section 408A of the Internal tional securities exchange need not file Revenue Code are not required to file a report concerning signature or other an FBAR with respect to a foreign fi- authority over a foreign financial ac- nancial account held by or on behalf of count of the subsidiary if he has no fi- the retirement plan or IRA. nancial interest in the account and the (5) Certain trust beneficiaries. A bene- United States subsidiary is included in ficiary of a trust described in para- a consolidated report of the parent graph (e)(2)(iv) of this section is not re- filed under this section. quired to report the trust’s foreign fi- (v) An officer or employee of an enti- ty that has a class of equity securities nancial accounts if the trust, trustee of registered (or American depository re- the trust, or agent of the trust is a ceipts in respect of equity securities United States person that files a report

604

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00614 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.360

under this section disclosing the (2) Transmittal orders received by a trust’s foreign financial accounts. respondent financial institution from a foreign financial agency or sent by re- [76 FR 10245, Feb. 24, 2011, as amended at 76 FR 37000, June 24, 2011] spondent financial institution to a for- eign financial agency, including all in- § 1010.360 Reports of transactions with formation maintained by that institu- foreign financial agencies. tion pursuant to §§ 1010.410 and 1020.410. (a) Promulgation of reporting require- (3) Loans made by respondent finan- ments. The Secretary, when he deems cial institution to or through a foreign appropriate, may promulgate regula- financial agency—including the fol- tions requiring specified financial in- lowing information: stitutions to file reports of certain (i) Name of borrower; transactions with designated foreign fi- (ii) Name of person acting for bor- nancial agencies. If any such regula- rower; tion is issued as a final rule without (iii) Date and amount of loan; notice and opportunity for public com- (iv) Terms of repayment; ment, then a finding of good cause for (v) Name of guarantor; dispensing with notice and comment in (vi) Rate of interest; accordance with 5 U.S.C. 553(b) will be (vii) Method of disbursing proceeds; included in the regulation. If any such (viii) Collateral for loan. regulation is not published in the FED- (4) Commercial paper received or ERAL REGISTER, then any financial in- shipped by the respondent financial in- stitution subject to the regulation will stitution—including the following in- be named and personally served or oth- formation: erwise given actual notice in accord- (i) Name of maker; ance with 5 U.S.C. 553(b). If a financial (ii) Date and amount of paper; institution is given notice of a report- (iii) Due date; ing requirement under this section by (iv) Certificate number; means other than publication in the (v) Amount of transaction. FEDERAL REGISTER, the Secretary may (5) Stocks received or shipped by re- prohibit disclosure of the existence or spondent financial institution—includ- provisions of that reporting require- ing the following information: ment to the designated foreign finan- (i) Name of corporation; cial agency or agencies and to any (ii) Type of stock; other party. (iii) Certificate number; (b) Information subject to reporting re- (iv) Number of shares; quirements. A regulation promulgated (v) Date of certificate; pursuant to paragraph (a) of this sec- (vi) Name of registered holder; tion shall designate one or more of the (vii) Amount of transaction. following categories of information to (6) Bonds received or shipped by re- be reported: spondent financial institution—includ- (1) Checks or drafts, including trav- ing the following information: eler’s checks, received by respondent (i) Name of issuer; financial institution for collection or (ii) Bond number; credit to the account of a foreign finan- (iii) Type of bond series; cial agency, sent by respondent finan- (iv) Date issued; cial institution to a foreign country for (v) Due date; collection or payment, drawn by re- (vi) Rate of interest; spondent financial institution on a for- (vii) Amount of transaction; eign financial agency, drawn by a for- (viii) Name of registered holder. eign financial agency on respondent fi- (7) Certificates of deposit received or nancial institution—including the fol- shipped by respondent financial insti- lowing information. tution—including the following infor- (i) Name of maker or drawer; mation: (ii) Name of drawee or drawee finan- (i) Name and address of issuer; cial institution; (ii) Date issued; (iii) Name of payee; (iii) Dollar amount; (iv) Date and amount of instrument; (iv) Name of registered holder; (v) Names of all endorsers. (v) Due date;

605

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00615 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.370 31 CFR Ch. X (7–1–11 Edition)

(vi) Rate of interest; ject of an investigation for possible (vii) Certificate number; violation of any other Federal law. (viii) Name and address of issuing (3) The Secretary may issue a regula- agent. tion pursuant to paragraph (a) of this (c) Scope of reports. In issuing regula- section requiring a financial institu- tions as provided in paragraph (a) of tion to report transactions completed this section, the Secretary will pre- prior to the date it received notice of scribe: the reporting requirement. However, (1) A reasonable classification of fi- with respect to completed trans- nancial institutions subject to or ex- actions, a financial institution may be empt from a reporting requirement; required to provide information only (2) A foreign country to which a re- from records required to be maintained porting requirement applies if the Sec- pursuant to the requirements of this retary decides that applying the re- chapter, or any other provision of state quirement to all foreign countries is or Federal law, or otherwise main- unnecessary or undesirable; tained in the regular course of busi- (3) The magnitude of transactions ness. subject to a reporting requirement; and (4) The kind of transaction subject to § 1010.370 Reports of certain domestic or exempt from a reporting require- coin and currency transactions. ment. (a) If the Secretary of the Treasury (d) Form of reports. Regulations issued finds, upon the Secretary’s own initia- pursuant to paragraph (a) of this sec- tive or at the request of an appropriate tion may prescribe the manner in Federal or State law enforcement offi- which the information is to be re- ported. However, the Secretary may cial, that reasonable grounds exist for authorize a designated financial insti- concluding that additional record- tution to report in a different manner keeping and/or reporting requirements if the institution demonstrates to the are necessary to carry out the purposes Secretary that the form of the required of this chapter and to prevent persons report is unnecessarily burdensome on from evading the reporting/record- the institution as prescribed; that a re- keeping requirements of this chapter, port in a different form will provide all the Secretary may issue an order re- the information the Secretary deems quiring any domestic financial institu- necessary; and that submission of the tion or group of domestic financial in- information in a different manner will stitutions in a geographic area and any not unduly hinder the effective admin- other person participating in the type istration of this chapter. of transaction to file a report in the (e) Limitations. (1) In issuing regula- manner and to the extent specified in tions under paragraph (a) of this sec- such order. The order shall contain tion, the Secretary shall consider the such information as the Secretary may need to avoid impeding or controlling describe concerning any transaction in the export or import of monetary in- which such financial institution is in- struments and the need to avoid bur- volved for the payment, receipt, or dening unreasonably a person making a transfer of United States coins or cur- transaction with a foreign financial rency (or such other monetary instru- agency. ments as the Secretary may describe in (2) The Secretary shall not issue a such order) the total amounts or de- regulation under paragraph (a) of this nominations of which are equal to or section for the purpose of obtaining in- greater than an amount which the Sec- dividually identifiable account infor- retary may prescribe. mation concerning a customer, as de- (b) An order issued under paragraph fined by the Right to Financial Privacy (a) of this section shall be directed to Act (12 U.S.C. 3401 et seq.), where that the Chief Executive Officer of the fi- customer is already the subject of an nancial institution and shall designate ongoing investigation for possible vio- one or more of the following categories lation of the Currency and Foreign of information to be reported: Each de- Transactions Reporting Act, or is posit, withdrawal, exchange of cur- known by the Secretary to be the sub- rency or other payment or transfer, by,

606

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00616 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.410

through or to such financial institu- United States, and/or political subdivi- tion specified in the order, which in- sion or subdivisions thereof, as speci- volves all or any class of transactions fied in an order issued pursuant to in currency and/or monetary instru- paragraph (a) of this section. ments equal to or exceeding an amount to be specified in the order. Subpart D—Records Required To (c) In issuing an order under para- graph (a) of this section, the Secretary Be Maintained will prescribe: § 1010.400 General. (1) The dollar amount of transactions subject to the reporting requirement in Each financial institution (as defined the order; in 31 U.S.C. 5312(a)(2) or (c)(1)) should (2) The type of transaction or trans- refer to its chapter X part for any addi- actions subject to or exempt from a re- tional recordkeeping requirements. Un- porting requirement in the order; less otherwise indicated, the record- (3) The appropriate form for report- keeping requirements contained in this ing the transactions required in the subpart D apply to all financial institu- order; tions. (4) The address to which reports re- quired in the order are to be sent or § 1010.401 Determination by the Sec- from which they will be picked up; retary. (5) The starting and ending dates by The Secretary hereby determines which such transactions specified in that the records required to be kept by the order are to be reported; this chapter have a high degree of use- (6) The name of a Treasury official to fulness in criminal, tax, or regulatory be contacted for any additional infor- investigations or proceedings. mation or questions; (7) The amount of time the reports § 1010.405 [Reserved] and records of reports generated in re- sponse to the order will have to be re- § 1010.410 Records to be made and re- tained by the financial institution; and tained by financial institutions. (8) Any other information deemed Each financial institution shall re- necessary to carry out the purposes of tain either the original or a microfilm the order. or other copy or reproduction of each (d)(1) No order issued pursuant to of the following: paragraph (a) of this section shall pre- (a) A record of each extension of scribe a reporting period of more than credit in an amount in excess of $10,000, 60 days unless renewed pursuant to the except an extension of credit secured requirements of paragraph (a). by an interest in real property, which (2) Any revisions to an order issued record shall contain the name and ad- under this section will not be effective until made in writing by the Secretary. dress of the person to whom the exten- (3) Unless otherwise specified in the sion of credit is made, the amount order, a bank receiving an order under thereof, the nature or purpose thereof, this section may continue to use the and the date thereof; exemptions granted under § 1020.315 of (b) A record of each advice, request, this chapter prior to the receipt of the or instruction received or given regard- order, but may not grant additional ex- ing any transaction resulting (or in- emptions. tended to result and later canceled if (4) For purposes of this section, the such a record is normally made) in the term geographic area means any area in transfer of currency or other monetary one or more States of the United instruments, funds, checks, investment States, the District of Columbia, the securities, or credit, of more than Commonwealth of Puerto Rico, the $10,000 to or from any person, account, United States Virgin Islands, Guam, or place outside the United States. the Commonwealth of the Northern (c) A record of each advice, request, Mariana Islands, American Samoa, the or instruction given to another finan- Trust Territory of the Pacific Islands, cial institution or other person located the territories and possessions of the within or without the United States,

607

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00617 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.410 31 CFR Ch. X (7–1–11 Edition)

regarding a transaction intended to re- signed by the person placing the trans- sult in the transfer of funds, or of cur- mittal order. rency, other monetary instruments, (ii) For each transmittal order that checks, investment securities, or cred- it accepts as an intermediary financial it, of more than $10,000 to a person, ac- institution, a financial institution count or place outside the United shall retain either the original or a States. microfilm, other copy, or electronic (d) A record of such information for record of the transmittal order. such period of time as the Secretary (iii) For each transmittal order that may require in an order issued under it accepts as a recipient’s financial in- § 1010.370(a), not to exceed five years. stitution, a financial institution shall (e) Nonbank financial institutions. retain either the original or a micro- Each agent, agency, branch, or office film, other copy, or electronic record of located within the United States of a the transmittal order. financial institution other than a bank (2) Transmittors other than established is subject to the requirements of this customers. In the case of a transmittal paragraph (e) with respect to a trans- order from a transmittor that is not an mittal of funds in the amount of $3,000 established customer, in addition to or more: obtaining and retaining the informa- (1) Recordkeeping requirements. (i) For tion required in paragraph (e)(1)(i) of each transmittal order that it accepts this section: as a transmittor’s financial institu- (i) If the transmittal order is made in tion, a financial institution shall ob- person, prior to acceptance the tain and retain either the original or a transmittor’s financial institution microfilm, other copy, or electronic shall verify the identity of the person record of the following information re- placing the transmittal order. If it ac- lating to the transmittal order: cepts the transmittal order, the (A) The name and address of the transmittor’s financial institution transmittor; shall obtain and retain a record of the (B) The amount of the transmittal name and address, the type of identi- order; fication reviewed, and the number of (C) The execution date of the trans- the identification document (e.g., driv- mittal order; er’s license), as well as a record of the (D) Any payment instructions re- person’s taxpayer identification num- ceived from the transmittor with the ber (e.g., social security or employer transmittal order; identification number) or, if none, (E) The identity of the recipient’s fi- alien identification number or passport nancial institution; number and country of issuance, or a (F) As many of the following items as notation in the record of the lack are received with the transmittal thereof. If the transmittor’s financial order: 1 institution has knowledge that the per- son placing the transmittal order is (1) The name and address of the re- cipient; not the transmittor, the transmittor’s financial institution shall obtain and (2) The account number of the recipi- retain a record of the transmittor’s ent; and taxpayer identification number (e.g., (3) Any other specific identifier of the social security or employer identifica- recipient; and tion number) or, if none, alien identi- (G) Any form relating to the trans- fication number or passport number mittal of funds that is completed or and country of issuance, if known by the person placing the order, or a nota- 1 For transmittals of funds effected tion in the record of the lack thereof. through the Federal Reserve’s Fedwire funds (ii) If the transmittal order accepted transfer system by a domestic broker or by the transmittor’s financial institu- dealers in securities, only one of the items is tion is not made in person, the required to be retained, if received with the transmittal order, until such time as the transmittor’s financial institution bank that sends the order to the Federal Re- shall obtain and retain a record of the serve Bank completes its conversion to the name and address of the person placing expanded Fedwire message format. the transmittal order, as well as the

608

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00618 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.410

person’s taxpayer identification num- person receiving the proceeds, or a no- ber (e.g., social security or employer tation in the record of the lack thereof. identification number) or, if none, (ii) If the proceeds are delivered alien identification number or passport other than in person, the recipient’s fi- number and country of issuance, or a nancial institution shall retain a copy notation in the record of the lack of the check or other instrument used thereof, and a copy or record of the to effect payment, or the information method of payment (e.g., check or cred- contained thereon, as well as the name it card transaction) for the transmittal and address of the person to which it of funds. If the transmittor’s financial was sent. institution has knowledge that the per- (4) Retrievability. The information son placing the transmittal order is that a transmittor’s financial institu- not the transmittor, the transmittor’s tion must retain under paragraphs financial institution shall obtain and (e)(1)(i) and (e)(2) of this section shall retain a record of the transmittor’s be retrievable by the transmittor’s fi- taxpayer identification number (e.g., nancial institution by reference to the social security or employer identifica- name of the transmittor. If the tion number) or, if none, alien identi- transmittor is an established customer fication number or passport number of the transmittor’s financial institu- and country of issuance, if known by tion and has an account used for trans- the person placing the order, or a nota- mittals of funds, then the information tion in the record of the lack thereof. also shall be retrievable by account number. The information that a recipi- (3) Recipients other than established ent’s financial institution must retain customers. For each transmittal order under paragraphs (e)(1)(iii) and (e)(3) of that it accepts as a recipient’s finan- this section shall be retrievable by the cial institution for a recipient that is recipient’s financial institution by ref- not an established customer, in addi- erence to the name of the recipient. If tion to obtaining and retaining the in- the recipient is an established cus- formation required in paragraph tomer of the recipient’s financial insti- (e)(1)(iii) of this section: tution and has an account used for (i) If the proceeds are delivered in transmittals of funds, then the infor- person to the recipient or its represent- mation also shall be retrievable by ac- ative or agent, the recipient’s financial count number. This information need institution shall verify the identity of not be retained in any particular man- the person receiving the proceeds and ner, so long as the financial institution shall obtain and retain a record of the is able to retrieve the information re- name and address, the type of identi- quired by this paragraph, either by ac- fication reviewed, and the number of cessing transmittal of funds records di- the identification document (e.g., driv- rectly or through reference to some er’s license), as well as a record of the other record maintained by the finan- person’s taxpayer identification num- cial institution. ber (e.g., social security or employer (5) Verification. Where verification is identification number) or, if none, required under paragraphs (e)(2) and alien identification number or passport (e)(3) of this section, a financial insti- number and country of issuance, or a tution shall verify a person’s identity notation in the record of the lack by examination of a document (other thereof. If the recipient’s financial in- than a customer signature card), pref- stitution has knowledge that the per- erably one that contains the person’s son receiving the proceeds is not the name, address, and photograph, that is recipient, the recipient’s financial in- normally acceptable by financial insti- stitution shall obtain and retain a tutions as a means of identification record of the recipient’s name and ad- when cashing checks for persons other dress, as well as the recipient’s tax- than established customers. payer identification number (e.g., so- Verification of the identity of an indi- cial security or employer identification vidual who indicates that he or she is number) or, if none, alien identifica- an alien or is not a resident of the tion number or passport number and United States may be made by pass- country of issuance, if known by the port, alien identification card, or other

609

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00619 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.410 31 CFR Ch. X (7–1–11 Edition)

official document evidencing nation- (iv) The execution date of the trans- ality or residence (e.g., a foreign driv- mittal order; er’s license with indication of home ad- (v) The identity of the recipient’s fi- dress). nancial institution; (6) Exceptions. The following trans- (vi) As many of the following items mittals of funds are not subject to the as are received with the transmittal requirements of this section: order: 2 (i) Transmittals of funds where the (A) The name and address of the re- transmittor and the recipient are any cipient; of the following: (B) The account number of the recipi- (A) A bank; ent; (B) A wholly-owned domestic sub- (C) Any other specific identifier of sidiary of a bank chartered in the the recipient; and United States; (vii) Either the name and address or (C) A broker or dealer in securities; numerical identifier of the (D) A wholly-owned domestic sub- transmittor’s financial institution. sidiary of a broker or dealer in securi- (2) A receiving financial institution ties; that acts as an intermediary financial (E) A futures commission merchant institution, if it accepts a transmittal or an introducing broker in commod- order, shall include in a corresponding ities; transmittal order at the time it is sent (F) A wholly-owned domestic sub- to the next receiving financial institu- sidiary of a futures commission mer- tion, the following information, if re- chant or an introducing broker in com- ceived from the sender: modities; (i) The name and the account number (G) The United States; of the transmittor; (H) A state or local government; or (I) A Federal, State or local govern- (ii) The address of the transmittor, ment agency or instrumentality; or except for a transmittal order through (J) A mutual fund; and Fedwire until such time as the bank (ii) Transmittals of funds where both that sends the order to the Federal Re- the transmittor and the recipient are serve Bank completes its conversion to the same person and the transmittor’s the expanded Fedwire format; financial institution and the recipi- (iii) The amount of the transmittal ent’s financial institution are the same order; broker or dealer in securities. (iv) The execution date of the trans- (f) Any transmittor’s financial insti- mittal order; tution or intermediary financial insti- (v) The identity of the recipient’s fi- tution located within the United nancial institution; States shall include in any transmittal (vi) As many of the following items order for a transmittal of funds in the as are received with the transmittal amount of $3,000 or more, information order: 3 as required in this paragraph (f): (1) A transmittor’s financial institu- 2 For transmittals of funds effected tion shall include in a transmittal through the Federal Reserve’s Fedwire funds order, at the time it is sent to a receiv- transfer system by a financial institution, ing financial institution, the following only one of the items is required to be in- cluded in the transmittal order, if received information: with the sender’s transmittal order, until (i) The name and, if the payment is such time as the bank that sends the order ordered from an account, the account to the Federal Reserve Bank completes its number of the transmittor; conversion to the expanded Fedwire message (ii) The address of the transmittor, format. except for a transmittal order through 3 For transmittals of funds effected Fedwire until such time as the bank through the Federal Reserve’s Fedwire funds that sends the order to the Federal Re- transfer system by a financial institution, only one of the items is required to be in- serve Bank completes its conversion to cluded in the transmittal order, if received the expanded Fedwire format; with the sender’s transmittal order, until (iii) The amount of the transmittal such time as the bank that sends the order order; to the Federal Reserve Bank completes its

610

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00620 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.415

(A) The name and address of the re- (A) Includes in the transmittal order, cipient; at the time it is sent to the receiving (B) The account number of the recipi- financial institution, the information ent; specified in paragraphs (f)(2)(iii) (C) Any other specific identifier of through (f)(2)(vi) of this section, to the the recipient; and extent that such information has been (vii) Either the name and address or received by the intermediary financial numerical identifier of the institution; and transmittor’s financial institution. (B) Provides the information speci- (3) Safe harbor for transmittals of funds fied in paragraphs (f)(2)(i), (ii) and (vii) prior to conversion to the expanded of this section, to the extent that such Fedwire message format. The following information has been received by the provisions apply to transmittals of intermediary financial institution, to a funds effected through the Federal Re- financial institution that acted as an serve’s Fedwire funds transfer system intermediary financial institution or or otherwise by a financial institution recipient’s financial institution in con- before the bank that sends the order to nection with the transmittal order, the Federal Reserve Bank or otherwise within a reasonable time after any completes its conversion to the ex- such financial institution makes a re- panded Fedwire message format. quest therefor in connection with the (i) Transmittor’s financial institution. A requesting financial institution’s re- transmittor’s financial institution will ceipt of a lawful request for such infor- be deemed to be in compliance with the mation from a Federal, State, or local provisions of paragraph (f)(1) of this law enforcement or regulatory agency, section if it: or in connection with the requesting fi- (A) Includes in the transmittal order, nancial institution’s own Bank Secrecy at the time it is sent to the receiving Act compliance program. financial institution, the information (iii) Obligation of requesting financial specified in paragraphs (f)(1)(iii) institution. Any information requested through (v), and the information speci- under paragraph (f)(3)(i)(B) or fied in paragraph (f)(1)(vi) of this sec- (f)(3)(ii)(B) of this section shall be tion to the extent that such informa- treated by the requesting institution, tion has been received by the financial once received, as if it had been in- institution, and cluded in the transmittal order to (B) Provides the information speci- which such information relates. fied in paragraphs (f)(1)(i), (ii) and (vii) of this section to a financial institu- (4) Exceptions. The requirements of tion that acted as an intermediary fi- this paragraph (f) shall not apply to nancial institution or recipient’s finan- transmittals of funds that are listed in cial institution in connection with the paragraph (e)(6) of this section or transmittal order, within a reasonable § 1020.410(a)(6) of this chapter. time after any such financial institu- tion makes a request therefor in con- § 1010.415 Purchases of bank checks and drafts, cashier’s checks, money nection with the requesting financial orders and traveler’s checks. institution’s receipt of a lawful request for such information from a Federal, (a) No financial institution may issue State, or local law enforcement or fi- or sell a bank check or draft, cashier’s nancial regulatory agency, or in con- check, money order or traveler’s check nection with the requesting financial for $3,000 or more in currency unless it institution’s own Bank Secrecy Act maintains records of the following in- compliance program. formation, which must be obtained for (ii) Intermediary financial institution. each issuance or sale of one or more of An intermediary financial institution these instruments to any individual will be deemed to be in compliance purchaser which involves currency in with the provisions of paragraph (f)(2) amounts of $3,000–$10,000 inclusive: of this section if it: (1) If the purchaser has a deposit ac- count with the financial institution: conversion to the expanded Fedwire message (i)(A) The name of the purchaser; format. (B) The date of purchase;

611

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00621 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.420 31 CFR Ch. X (7–1–11 Edition)

(C) The type(s) of instrument(s) pur- within the banking community as a chased; means of identification when cashing (D) The serial number(s) of each of checks for nondepositors and which the instrument(s) purchased; and contains the name and address of the (E) The amount in dollars of each of purchaser, and shall record the specific the instrument(s) purchased. identifying information (e.g., State of (ii) In addition, the financial institu- issuance and number of driver’s li- tion must verify that the individual is cense). a deposit accountholder or must verify (b) Contemporaneous purchases of the individual’s identity. Verification the same or different types of instru- may be either through a signature card ments totaling $3,000 or more shall be or other file or record at the financial treated as one purchase. Multiple pur- institution provided the deposit accountholder’s name and address were chases during one business day totaling verified previously and that informa- $3,000 or more shall be treated as one tion was recorded on the signature card purchase if an individual employee, di- or other file or record; or by examina- rector, officer, or partner of the finan- tion of a document which is normally cial institution has knowledge that acceptable within the banking commu- these purchases have occurred. nity as a means of identification when (c) Records required to be kept shall cashing checks for nondepositors and be retained by the financial institution which contains the name and address for a period of five years and shall be of the purchaser. If the deposit made available to the Secretary upon accountholder’s identity has not been request at any time. verified previously, the financial insti- tution shall verify the deposit § 1010.420 Records to be made and re- accountholder’s identity by examina- tained by persons having financial tion of a document which is normally interests in foreign financial ac- acceptable within the banking commu- counts. nity as a means of identification when Records of accounts required by cashing checks for nondepositors and § 1010.350 to be reported to the Commis- which contains the name and address sioner of Internal Revenue shall be re- of the purchaser, and shall record the tained by each person having a finan- specific identifying information (e.g., cial interest in or signature or other State of issuance and number of driv- authority over any such account. Such er’s license). records shall contain the name in (2) If the purchaser does not have a which each such account is main- deposit account with the financial in- tained, the number or other designa- stitution: tion of such account, the name and ad- (i)(A) The name and address of the dress of the foreign bank or other per- purchaser; son with whom such account is main- (B) The social security number of the tained, the type of such account, and purchaser, or if the purchaser is an the maximum value of each such ac- alien and does not have a social secu- count during the reporting period. rity number, the alien identification number; Such records shall be retained for a pe- (C) The date of birth of the pur- riod of 5 years and shall be kept at all chaser; times available for inspection as au- (D) The date of purchase; thorized by law. In the computation of (E) The type(s) of instrument(s) pur- the period of 5 years, there shall be dis- chased; regarded any period beginning with a (F) The serial number(s) of the in- date on which the taxpayer is indicted strument(s) purchased; and or information instituted on account of (G) The amount in dollars of each of the filing of a false or fraudulent Fed- the instrument(s) purchased. eral income tax return or failing to file (ii) In addition, the financial institu- a Federal income tax return, and end- tion shall verify the purchaser’s name ing with the date on which final dis- and address by examination of a docu- position is made of the criminal pro- ment which is normally acceptable ceeding.

612

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00622 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.505

§ 1010.430 Nature of records and reten- to a person outside the United States, tion period. except that, unless otherwise directed (a) Wherever it is required that there by the Secretary, this section shall not be retained either the original or a apply to a transaction on the books of microfilm or other copy or reproduc- a domestic financial institution involv- tion of a check, draft, monetary instru- ing the account of a customer of such ment, investment security, or other institution whose address is within ap- similar instrument, there shall be re- proximately 50 miles of the location of tained a copy of both front and back of the institution, or who is known to be each such instrument or document, ex- temporarily outside the United States. cept that no copy need be retained of the back of any instrument or docu- ment which is entirely blank or which Subpart E—Special Information contains only standardized printed in- Sharing Procedures To Deter formation, a copy of which is on file. Money Laundering and Ter- (b) Records required by this chapter rorist Activity to be retained by financial institutions may be those made in the ordinary § 1010.500 General. course of business by a financial insti- Sections 1010.505 through 1010.540 of tution. If no record is made in the ordi- this subpart E were issued pursuant to nary course of business of any trans- the requirements of section 314 of the action with respect to which records USA PATRIOT Act. Each financial in- are required to be retained by this chapter, then such a record shall be stitution (as defined in 31 U.S.C. prepared in writing by the financial in- 5312(a)(2) or (c)(1)) should refer to its stitution. chapter X part for any additional spe- (c) The rules and regulations issued cial information sharing procedures. by the Internal Revenue Service under 26 U.S.C. 6109 determine what con- § 1010.505 Definitions. stitutes a taxpayer identification num- For purposes of this subpart E, the ber and whose number shall be ob- following definitions apply: tained in the case of an account main- (a) Account means a formal banking tained by one or more persons. or business relationship established to (d) All records that are required to be provide regular services, dealings, and retained by this chapter shall be re- other financial transactions, and in- tained for a period of five years. cludes, but is not limited to, a demand Records or reports required to be kept deposit, savings deposit, or other trans- pursuant to an order issued under action or asset account and a credit ac- § 1010.370 of this chapter shall be re- count or other extension of credit. tained for the period of time specified (b) means an activ- in such order, not to exceed five years. Money laundering All such records shall be filed or stored ity criminalized by 18 U.S.C. 1956 or in such a way as to be accessible within 1957, or an activity that would be a reasonable period of time, taking criminalized by 18 U.S.C. 1956 or 1957 if into consideration the nature of the it occurred in the United States. record, and the amount of time expired (c) Terrorist activity means an act of since the record was made. domestic terrorism or international terrorism as those terms are defined in § 1010.440 Person outside the United 18 U.S.C. 2331. States. (d) Transaction. (1) Except as provided For the purposes of this chapter, a in paragraph (d)(2) of this section, the remittance or transfer of funds, or of term ‘‘transaction’’ shall have the currency, other monetary instruments, same meaning as provided in checks, investment securities, or credit § 1010.100(bbb). to the domestic account of a person (2) For purposes of § 1010.520, a trans- whose address is known by the person action shall not mean any transaction making the remittance or transfer, to conducted through an account. be outside the United States, shall be deemed to be a remittance or transfer

613

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00623 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.520 31 CFR Ch. X (7–1–11 Edition)

§ 1010.520 Information sharing be- (2) Requests from FinCEN. FinCEN tween government agencies and fi- may solicit, on its own behalf and on nancial institutions. behalf of appropriate components of (a) Definitions. For purposes of this the Department of the Treasury, section: whether a financial institution or a (1) Financial institution means any fi- group of financial institutions main- nancial institution described in 31 tains or has maintained accounts for, U.S.C. 5312(a)(2). or has engaged in transactions with, (2) Law enforcement agency means a any specified individual, entity, or or- Federal, State, local, or foreign law en- ganization. Before an information re- forcement agency with criminal inves- quest under this section is made to a fi- tigative authority, provided that in the nancial institution, FinCEN or the ap- case of a foreign law enforcement agen- propriate Treasury component shall cy, such agency is from a jurisdiction certify in writing in the same manner that is a party to a treaty that pro- as a requesting law enforcement agen- vides, or in the determination of cy that each individual, entity or orga- FinCEN is from a jurisdiction that oth- nization about which FinCEN or the erwise allows, law enforcement agen- appropriate Treasury component is cies in the United States reciprocal ac- seeking information is engaged in, or is cess to information comparable to that reasonably suspected based on credible obtained under this section. evidence of engaging in, terrorist ac- (b) Information requests based on cred- tivity or money laundering. The cer- ible evidence concerning terrorist activity tification also must include enough or money laundering—(1) In general. A specific identifiers, such as date of law enforcement agency investigating birth, address, and social security num- terrorist activity or money laundering ber, that would permit a financial in- may request that FinCEN solicit, on stitution to differentiate between com- the investigating agency’s behalf, cer- mon or similar names, and identify one tain information from a financial insti- person at FinCEN or the appropriate tution or a group of financial institu- Treasury component who can be con- tions. When submitting such a request tacted with any questions relating to to FinCEN, the law enforcement agen- its request. cy shall provide FinCEN with a written (3) Obligations of a financial institution certification, in such form and manner receiving an information request—(i) as FinCEN may prescribe. At a min- Record search. Upon receiving an infor- imum, such certification must: State mation request from FinCEN under that each individual, entity, or organi- this section, a financial institution zation about which the law enforce- shall expeditiously search its records ment agency is seeking information is to determine whether it maintains or engaged in, or is reasonably suspected has maintained any account for, or has based on credible evidence of engaging engaged in any transaction with, each in, terrorist activity or money laun- individual, entity, or organization dering; include enough specific identi- named in FinCEN’s request. A financial fiers, such as date of birth, address, and institution may contact the law en- social security number, that would per- forcement agency, FinCEN or request- mit a financial institution to differen- ing Treasury component representa- tiate between common or similar tive, or U.S. law enforcement attache´ names; and identify one person at the in the case of a request by a foreign agency who can be contacted with any law enforcement agency, which has questions relating to its request. Upon been named in the information request receiving the requisite certification provided to the institution by FinCEN from the requesting law enforcement with any questions relating to the agency, FinCEN may require any fi- scope or terms of the request. Except nancial institution to search its as otherwise provided in the informa- records to determine whether the fi- tion request, a financial institution nancial institution maintains or has shall only be required to search its maintained accounts for, or has en- records for: gaged in transactions with, any speci- (A) Any current account maintained fied individual, entity, or organization. for a named suspect;

614

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00624 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.520

(B) Any account maintained for a (1) Reporting to FinCEN as provided named suspect during the preceding in this section; twelve months; and (2) Determining whether to establish (C) Any transaction, as defined by or maintain an account, or to engage § 1010.505(d), conducted by or on behalf in a transaction; or of a named suspect, or any transmittal (3) Assisting the financial institution of funds conducted in which a named in complying with any requirement of suspect was either the transmittor or this chapter. the recipient, during the preceding six (B)(1) A financial institution shall months that is required under law or not disclose to any person, other than regulation to be recorded by the finan- FinCEN or the requesting Treasury cial institution or is recorded and component, the law enforcement agen- maintained electronically by the insti- cy on whose behalf FinCEN is request- tution. ing information, or U.S. law enforce- (ii) Report to FinCEN. If a financial ment attache´ in the case of a request institution identifies an account or by a foreign law enforcement agency, transaction identified with any indi- which has been named in the informa- vidual, entity, or organization named tion request, the fact that FinCEN has in a request from FinCEN, it shall re- requested or has obtained information port to FinCEN, in the manner and in under this section, except to the extent the time frame specified in FinCEN’s necessary to comply with such an in- request, the following information: formation request. (2) Notwithstanding paragraph (A) The name of such individual, en- (b)(3)(iv)(B)(1) of this section, a finan- tity, or organization; cial institution authorized to share in- (B) The number of each such account, formation under § 1010.540 may share or in the case of a transaction, the date information concerning an individual, and type of each such transaction; and entity, or organization named in a re- (C) Any Social Security number, tax- quest from FinCEN in accordance with payer identification number, passport the requirements of such section. How- number, date of birth, address, or other ever, such sharing shall not disclose similar identifying information pro- the fact that FinCEN has requested in- vided by the individual, entity, or orga- formation concerning such individual, nization when each such account was entity, or organization. opened or each such transaction was (C) Each financial institution shall conducted. maintain adequate procedures to pro- (iii) Designation of contact person. tect the security and confidentiality of Upon receiving an information request requests from FinCEN for information under this section, a financial institu- under this section. The requirements of tion shall designate one person to be this paragraph (b)(3)(iv)(C) shall be the point of contact at the institution deemed satisfied to the extent that a regarding the request and to receive financial institution applies to such in- similar requests for information from formation procedures that the institu- FinCEN in the future. When requested tion has established to satisfy the re- by FinCEN, a financial institution quirements of section 501 of the shall provide FinCEN with the name, Gramm-Leach-Bliley Act (15 U.S.C. title, mailing address, e-mail address, 6801), and applicable regulations issued telephone number, and facsimile num- thereunder, with regard to the protec- ber of such person, in such manner as tion of its customers’ nonpublic per- FinCEN may prescribe. A financial in- sonal information. stitution that has provided FinCEN (v) No other action required. Nothing with contact information must in this section shall be construed to re- promptly notify FinCEN of any quire a financial institution to take changes to such information. any action, or to decline to take any (iv) Use and security of information re- action, with respect to an account es- quest. (A) A financial institution shall tablished for, or a transaction engaged not use information provided by in with, an individual, entity, or orga- FinCEN pursuant to this section for nization named in a request from any purpose other than: FinCEN, or to decline to establish an

615

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00625 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.530 31 CFR Ch. X (7–1–11 Edition)

account for, or to engage in a trans- tirely of financial institutions as de- action with, any such individual, enti- fined in paragraph (a)(1) of this section. ty, or organization. Except as other- (b) Voluntary information sharing wise provided in an information re- among financial institutions—(1) In gen- quest under this section, such a request eral. Subject to paragraphs (b)(2), (b)(3), shall not require a financial institution and (b)(4) of this section, a financial in- to report on future account opening ac- stitution or an association of financial tivity or transactions or to treat a sus- institutions may, under the protection pect list received under this section as of the safe harbor from liability de- a government list for purposes of sec- scribed in paragraph (b)(5) of this sec- tion 326 of Public Law 107–56. tion, transmit, receive, or otherwise (4) Relation to the Right to Financial share information with any other fi- Privacy Act and the Gramm-Leach-Bliley nancial institution or association of fi- Act. The information that a financial nancial institutions regarding individ- institution is required to report pursu- uals, entities, organizations, and coun- ant to paragraph (b)(3)(ii) of this sec- tries for purposes of identifying and, tion is information required to be re- where appropriate, reporting activities ported in accordance with a Federal that the financial institution or asso- statute or rule promulgated there- ciation suspects may involve possible under, for purposes of subsection terrorist activity or money laundering. 3413(d) of the Right to Financial Pri- (2) Notice requirement. A financial in- vacy Act (12 U.S.C. 3413(d)) and sub- stitution or association of financial in- section 502(e)(8) of the Gramm-Leach- stitutions that intends to share infor- Bliley Act (15 U.S.C. 6802(e)(8)). mation as described in paragraph (b)(1) (5) No effect on law enforcement or reg- of this section shall submit to FinCEN ulatory investigations. Nothing in this a notice described on FinCEN’s Inter- subpart affects the authority of a Fed- net Web site, http://www.fincen.gov. Each notice provided pursuant to this eral, State, or local law enforcement paragraph (b)(2) shall be effective for agency or officer, or FinCEN or an- the one year period beginning on the other component of the Department of date of the notice. In order to continue the Treasury, to obtain information di- to engage in the sharing of information rectly from a financial institution. after the end of the one year period, a § 1010.530 [Reserved] financial institution or association of financial institutions must submit a § 1010.540 Voluntary information shar- new notice. Completed notices may be ing among financial institutions. submitted to FinCEN by accessing FinCEN’s Internet Web site, http:// (a) Definitions. For purposes of this www.fincen.gov., and entering the ap- section: propriate information as directed, or, if (1) Financial institution. (i) Except as a financial institution does not have provided in paragraph (a)(1)(ii) of this Internet access, by mail to: FinCEN, section, the term ‘‘financial institu- P.O. Box 39, Vienna, VA 22183. tion’’ means any financial institution (3) Verification requirement. Prior to described in 31 U.S.C. 5312(a)(2) that is sharing information as described in required under this chapter to estab- paragraph (b)(1) of this section, a finan- lish and maintain an anti-money laun- cial institution or an association of fi- dering program, or is treated under nancial institutions must take reason- this chapter as having satisfied the re- able steps to verify that the other fi- quirements of 31 U.S.C. 5318(h)(1). nancial institution or association of fi- (ii) For purposes of this section, a fi- nancial institutions with which it in- nancial institution shall not mean any tends to share information has sub- institution included within a class of mitted to FinCEN the notice required financial institutions that FinCEN has by paragraph (b)(2) of this section. A fi- designated as ineligible to share infor- nancial institution or an association of mation under this section. financial institutions may satisfy this (2) Association of financial institutions paragraph (b)(3) by confirming that the means a group or organization the other financial institution or associa- membership of which is comprised en- tion of financial institutions appears

616

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00626 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.600

on a list that FinCEN will periodically (c) Information sharing between finan- make available to financial institu- cial institutions and the Federal Govern- tions or associations of financial insti- ment. If, as a result of information tutions that have filed a notice with it, shared pursuant to this section, a fi- or by confirming directly with the nancial institution knows, suspects, or other financial institution or associa- has reason to suspect that an indi- tion of financial institutions that the vidual, entity, or organization is in- requisite notice has been filed. volved in, or may be involved in ter- (4) Use and security of information. (i) rorist activity or money laundering, Information received by a financial in- and such institution is subject to a sus- stitution or an association of financial picious activity reporting requirement institutions pursuant to this section under this chapter or other applicable shall not be used for any purpose other regulations, the institution shall file a than: Suspicious Activity Report in accord- (A) Identifying and, where appro- ance with those regulations. In situa- priate, reporting on money laundering tions involving violations requiring or terrorist activities; immediate attention, such as when a (B) Determining whether to establish reportable violation involves terrorist or maintain an account, or to engage activity or is ongoing, the financial in- in a transaction; or stitution shall immediately notify, by (C) Assisting the financial institution telephone, an appropriate law enforce- in complying with any requirement of ment authority and financial institu- this chapter. tion supervisory authorities in addi- (ii) Each financial institution or as- tion to filing timely a Suspicious Ac- sociation of financial institutions that tivity Report. A financial institution engages in the sharing of information that is not subject to a suspicious ac- pursuant to this section shall maintain adequate procedures to protect the se- tivity reporting requirement is not re- curity and confidentiality of such in- quired to file a Suspicious Activity Re- formation. The requirements of this port or otherwise to notify law enforce- paragraph (b)(4)(ii) shall be deemed sat- ment of suspicious activity that is de- isfied to the extent that a financial in- tected as a result of information shared stitution applies to such information pursuant to this section. Such a finan- procedures that the institution has es- cial institution is encouraged, however, tablished to satisfy the requirements of to voluntarily report such activity to section 501 of the Gramm-Leach-Bliley FinCEN. Act (15 U.S.C. 6801), and applicable reg- (d) No effect on financial institution re- ulations issued thereunder, with regard porting obligations. Nothing in this sub- to the protection of its customers’ non- part affects the obligation of a finan- public personal information. cial institution to file a Suspicious Ac- (5) Safe harbor from certain liability— tivity Report pursuant to this chapter (i) In general. A financial institution or or any other applicable regulations, or association of financial institutions to otherwise contact directly a Federal that shares information pursuant to agency concerning individuals or enti- paragraph (b) of this section shall be ties suspected of engaging in terrorist protected from liability for such shar- activity or money laundering. ing, or for any failure to provide notice of such sharing, to an individual, enti- Subpart F—Special Standards of ty, or organization that is identified in such sharing, to the full extent pro- Diligence; Prohibitions; and vided in subsection 314(b) of Public Law Special Measures 107–56. § 1010.600 General. (ii) Limitation. Paragraph (b)(5)(i) of this section shall not apply to a finan- Each financial institution (as defined cial institution or association of finan- in 31 U.S.C. 5312(a)(2) or (c)(1)) should cial institutions to the extent such in- refer to its Chapter X Part for any ad- stitution or association fails to comply ditional special standards of diligence; with paragraphs (b)(2), (b)(3), or (b)(4) prohibitions; and special measures re- of this section. quirements.

617

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00627 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.605 31 CFR Ch. X (7–1–11 Edition)

SPECIAL DUE DILIGENCE FOR COR- (B) Includes a demand deposit, sav- RESPONDENT ACCOUNTS AND PRIVATE ings deposit, or other transaction or BANKING ACCOUNTS asset account and a credit account or other extension of credit; § 1010.605 Definitions. (ii) As applied to brokers or dealers Except as otherwise provided, the fol- in securities (as set forth in paragraph lowing definitions apply for purposes of (e)(1)(viii) of this section) means any §§ 1010.610 through 1010.630 and § 1010.670: formal relationship established with a (a) Beneficial owner of an account broker or dealer in securities to pro- means an individual who has a level of vide regular services to effect trans- control over, or entitlement to, the actions in securities, including, but not funds or assets in the account that, as limited to, the purchase or sale of secu- a practical matter, enables the indi- rities and securities loaned and bor- vidual, directly or indirectly, to con- rowed activity, and to hold securities trol, manage or direct the account. The or other assets for safekeeping or as ability to fund the account or the enti- collateral; tlement to the funds of the account (iii) As applied to futures commission alone, however, without any cor- merchants and introducing brokers (as responding authority to control, man- set forth in paragraph (e)(1)(ix) of this age or direct the account (such as in section) means any formal relationship the case of a minor child beneficiary), established by a futures commission does not cause the individual to be a merchant to provide regular services, beneficial owner. including, but not limited to, those es- tablished to effect transactions in con- (b) Certification and recertification tracts of sale of a commodity for future mean the certification and recertifi- delivery, options on any contract of cation forms regarding correspondent sale of a commodity for future deliv- accounts for foreign banks located on ery, or options on a commodity; and FinCEN’s Internet Web site, http:// (iv) As applied to mutual funds (as www.fincen.gov. set forth in paragraph (e)(1)(x) of this (c) (1) The Correspondent account. section) means any contractual or term means: correspondent account other business relationship established (i) For purposes of § 1010.610(a), (d) between a person and a mutual fund to and (e), an account established for a provide regular services to effect trans- foreign financial institution to receive actions in securities issued by the mu- deposits from, or to make payments or tual fund, including the purchase or other disbursements on behalf of, the sale of securities. foreign financial institution, or to han- (d) Correspondent relationship has the dle other financial transactions related same meaning as correspondent ac- to such foreign financial institution; count for purposes of §§ 1010.630 and and 1010.670. (ii) For purposes of §§ 1010.610(b) and (e) Covered financial institution means: (c), 1010.630 and 1010.670, an account es- (1) For purposes of § 1010.610 and tablished for a foreign bank to receive 1010.620: deposits from, or to make payments or (i) An insured bank (as defined in sec- other disbursements on behalf of, the tion 3(h) of the Federal Deposit Insur- foreign bank, or to handle other finan- ance Act (12 U.S.C. 1813(h))); cial transactions related to such for- (ii) A commercial bank; eign bank. (iii) An agency or branch of a foreign (2) For purposes of this definition, bank in the United States; the term account: (iv) A federally insured credit union; (i) As applied to banks (as set forth (v) A savings association; in paragraphs (e)(1)(i) through (vii) of (vi) A corporation acting under sec- this section): tion 25A of the Federal Reserve Act (12 (A) Means any formal banking or U.S.C. 611 et seq.); business relationship established by a (vii) A trust bank or trust company bank to provide regular services, deal- that is federally regulated and is sub- ings, and other financial transactions; ject to an anti-money laundering pro- and gram requirement;

618

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00628 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.605

(viii) A broker or dealer in securities of such person in the United States) registered, or required to be registered, that is engaged in the business of, and with the Securities and Exchange Com- is readily identifiable as: mission under the Securities Exchange (A) A currency dealer or exchanger; Act of 1934 (15 U.S.C. 78a et seq.), except or persons who register pursuant to sec- (B) A money transmitter. tion 15(b)(11) of the Securities Ex- (2) For purposes of paragraph change Act of 1934; (f)(1)(iv) of this section, a person is not (ix) A futures commission merchant ‘‘engaged in the business’’ of a cur- or an introducing broker registered, or rency dealer, a currency exchanger or a required to be registered, with the money transmitter if such transactions Commodity Futures Trading Commis- are merely incidental to the person’s sion under the Commodity Exchange business. Act (7 U.S.C. 1 et seq.), except persons (g) Foreign shell bank means a foreign who register pursuant to section bank without a physical presence in 4(f)(a)(2) of the Commodity Exchange any country. Act; and (h) Non-United States person or non- (x) A mutual fund; U.S. person means a natural person who (2) For purposes of §§ 1010.630 and is neither a United States citizen nor is 1010.670: accorded the privilege of residing per- (i) An insured bank (as defined in sec- manently in the United States pursu- tion 3(h) of the Federal Deposit Insur- ant to title 8 of the United States Code. ance Act (12 U.S.C. 1813(h))); For purposes of this paragraph (h), the (ii) A commercial bank or trust com- definition of person in § 1010.100(mm) pany; does not apply, notwithstanding para- (iii) A private banker; graph (k) of this section. (iv) An agency or branch of a foreign (i) Offshore banking license means a li- bank in the United States; cense to conduct banking activities (v) A credit union; that prohibits the licensed entity from (vi) A savings association; conducting banking activities with the (vii) A corporation acting under sec- citizens of, or in the local currency of, tion 25A of the Federal Reserve Act (12 the jurisdiction that issued the license. U.S.C. 611 et seq.); and (j) Owner. (1) The term owner means (viii) A broker or dealer in securities any person who, directly or indirectly: registered, or required to be registered, with the Securities and Exchange Com- (i) Owns, controls, or has the power mission under the Securities Exchange to vote 25 percent or more of any class Act of 1934 (15 U.S.C. 78a et seq.), except of voting securities or other voting in- persons who register pursuant to sec- terests of a foreign bank; or tion 15(b)(11) of the Securities Ex- (ii) Controls in any manner the elec- change Act of 1934. tion of a majority of the directors (or (f) Foreign financial institution. (1) The individuals exercising similar func- term foreign financial institution means: tions) of a foreign bank. (i) A foreign bank; (2) For purposes of this definition: (ii) Any branch or office located out- (i) Members of the same family shall side the United States of any covered be considered to be one person. financial institution described in para- (ii) The term same family means par- graphs (e)(1)(viii) through (x) of this ents, spouses, children, siblings, uncles, section; aunts, grandparents, grandchildren, (iii) Any other person organized first cousins, stepchildren, stepsiblings, under foreign law (other than a branch parents-in-law, and spouses of any of or office of such person in the United the foregoing. States) that, if it were located in the (iii) Each member of the same family United States, would be a covered fi- who has an ownership interest in a for- nancial institution described in para- eign bank must be identified if the graphs (e)(1)(viii) through (x) of this family is an owner as a result of aggre- section; and gating the ownership interests of the (iv) Any person organized under for- members of the family. In determining eign law (other than a branch or office the ownership interests of the same

619

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00629 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.610 31 CFR Ch. X (7–1–11 Edition)

family, any voting interest of any fam- (i) Affiliate means a foreign bank that ily member shall be taken into ac- is controlled by, or is under common count. control with, a depository institution, (iv) Voting securities or other voting in- credit union, or foreign bank. terests means securities or other inter- (ii) Control means: ests that entitle the holder to vote for (A) Ownership, control, or power to or to select directors (or individuals vote 50 percent or more of any class of exercising similar functions). voting securities or other voting inter- (k) Person has the meaning provided ests of another company; or in § 1010.100(mm). (B) Control in any manner the elec- (l) Physical presence means a place of tion of a majority of the directors (or business that: individuals exercising similar func- (1) Is maintained by a foreign bank; tions) of another company. (2) Is located at a fixed address (other (o) Secretary means the Secretary of than solely an electronic address or a the Treasury. post-office box) in a country in which (p) Senior foreign political figure. (1) the foreign bank is authorized to con- The term senior foreign political figure duct banking activities, at which loca- means: tion the foreign bank: (i) A current or former: (i) Employs one or more individuals (A) Senior official in the executive, on a full-time basis; and legislative, administrative, military, (ii) Maintains operating records re- or judicial branches of a foreign gov- lated to its banking activities; and ernment (whether elected or not); (3) Is subject to inspection by the (B) Senior official of a major foreign banking authority that licensed the political party; or foreign bank to conduct banking ac- (C) Senior executive of a foreign gov- tivities. ernment-owned commercial enterprise; (ii) A corporation, business, or other (m) Private banking account means an entity that has been formed by, or for account (or any combination of ac- the benefit of, any such individual; counts) maintained at a covered finan- (iii) An immediate family member of cial institution that: any such individual; and (1) Requires a minimum aggregate (iv) A person who is widely and pub- deposit of funds or other assets of not licly known (or is actually known by less than $1,000,000; the relevant covered financial institu- (2) Is established on behalf of or for tion) to be a close associate of such in- the benefit of one or more non-U.S. dividual. persons who are direct or beneficial (2) For purposes of this definition: owners of the account; and (i) Senior official or executive means an (3) Is assigned to, or is administered individual with substantial authority or managed by, in whole or in part, an over policy, operations, or the use of officer, employee, or agent of a covered government-owned resources; and financial institution acting as a liaison (ii) Immediate family member means between the covered financial institu- spouses, parents, siblings, children and tion and the direct or beneficial owner a spouse’s parents and siblings. of the account. (n) Regulated affiliate. (1) The term § 1010.610 Due diligence programs for regulated affiliate means a foreign shell correspondent accounts for foreign bank that: financial institutions. (i) Is an affiliate of a depository in- (a) In general. A covered financial in- stitution, credit union, or foreign bank stitution shall establish a due diligence that maintains a physical presence in program that includes appropriate, spe- the United States or a foreign country, cific, risk-based, and, where necessary, as applicable; and enhanced policies, procedures, and con- (ii) Is subject to supervision by a trols that are reasonably designed to banking authority in the country regu- enable the covered financial institu- lating such affiliated depository insti- tion to detect and report, on an ongo- tution, credit union, or foreign bank. ing basis, any known or suspected (2) For purposes of this definition: money laundering activity conducted

620

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00630 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.610

through or involving any cor- the United States for a foreign bank respondent account established, main- described in paragraph (c) of this sec- tained, administered, or managed by tion, the due diligence program re- such covered financial institution in quired by paragraph (a) of this section the United States for a foreign finan- shall include enhanced due diligence cial institution. The due diligence pro- procedures designed to ensure that the gram required by this section shall be covered financial institution, at a min- a part of the anti-money laundering imum, takes reasonable steps to: program otherwise required by this (1) Conduct enhanced scrutiny of chapter. Such policies, procedures, and such correspondent account to guard controls shall include: against money laundering and to iden- (1) Determining whether any such tify and report any suspicious trans- correspondent account is subject to actions in accordance with applicable paragraph (b) of this section; law and regulation. This enhanced (2) Assessing the money laundering scrutiny shall reflect the risk assess- risk presented by such correspondent ment of the account and shall include, account, based on a consideration of all as appropriate: relevant factors, which shall include, (i) Obtaining and considering infor- as appropriate: mation relating to the foreign bank’s (i) The nature of the foreign financial anti-money laundering program to as- institution’s business and the markets sess the risk of money laundering pre- it serves; sented by the foreign bank’s cor- (ii) The type, purpose, and antici- respondent account; pated activity of such correspondent (ii) Monitoring transactions to, from, account; or through the correspondent account (iii) The nature and duration of the in a manner reasonably designed to de- covered financial institution’s rela- tect money laundering and suspicious tionship with the foreign financial in- activity; and stitution (and any of its affiliates); (iii)(A) Obtaining information from (iv) The anti-money laundering and the foreign bank about the identity of supervisory regime of the jurisdiction any person with authority to direct that issued the charter or license to transactions through any cor- the foreign financial institution, and, respondent account that is a payable- to the extent that information regard- through account, and the sources and ing such jurisdiction is reasonably beneficial owner of funds or other as- available, of the jurisdiction in which sets in the payable-through account. any company that is an owner of the (B) For purposes of paragraph foreign financial institution is incor- (b)(1)(iii)(A) of this section, a payable- porated or chartered; and through account means a correspondent (v) Information known or reasonably account maintained by a covered finan- available to the covered financial insti- cial institution for a foreign bank by tution about the foreign financial in- means of which the foreign bank per- stitution’s anti-money laundering mits its customers to engage, either di- record; and rectly or through a subaccount, in (3) Applying risk-based procedures banking activities usual in connection and controls to each such cor- with the business of banking in the respondent account reasonably de- United States. signed to detect and report known or (2) Determine whether the foreign suspected money laundering activity, bank for which the correspondent ac- including a periodic review of the cor- count is established or maintained in respondent account activity sufficient turn maintains correspondent accounts to determine consistency with informa- for other foreign banks that use the tion obtained about the type, purpose, foreign correspondent account estab- and anticipated activity of the ac- lished or maintained by the covered fi- count. nancial institution and, if so, take rea- (b) Enhanced due diligence for certain sonable steps to obtain information foreign banks. In the case of a cor- relevant to assess and mitigate money respondent account established, main- laundering risks associated with the tained, administered, or managed in foreign bank’s correspondent accounts

621

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00631 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.610 31 CFR Ch. X (7–1–11 Edition)

for other foreign banks, including, as gence or enhanced due diligence with appropriate, the identity of those for- respect to a correspondent account, in- eign banks. cluding when the covered financial in- (3)(i) Determine, for any cor- stitution should refuse to open the ac- respondent account established or count, suspend transaction activity, maintained for a foreign bank whose file a suspicious activity report, or shares are not publicly traded, the close the account. identity of each owner of the foreign (e) Applicability rules for general due bank and the nature and extent of each diligence. The provisions of paragraph owner’s ownership interest. (a) of this section apply to covered fi- (ii) For purposes of paragraph (b)(3)(i) nancial institutions as follows: of this section: (1) General rules—(i) Correspondent ac- (A) Owner means any person who di- counts established on or after July 5, 2006. rectly or indirectly owns, controls, or Effective July 5, 2006, the requirements has the power to vote 10 percent or of paragraph (a) of this section shall more of any class of securities of a for- apply to each correspondent account eign bank. For purposes of this para- established on or after that date. graph (b)(3)(ii)(A): (ii) Correspondent accounts established (1) Members of the same family shall before July 5, 2006. Effective October 2, be considered to be one person; and 2006, the requirements of paragraph (a) (2) Same family has the meaning pro- of this section shall apply to each cor- vided in § 1010.605(j)(2)(ii). respondent account established before (B) Publicly traded means shares that July 5, 2006. are traded on an exchange or an orga- (2) Special rules for certain banks. nized over-the-counter market that is Until the requirements of paragraph (a) regulated by a foreign securities au- of this section become applicable as set thority as defined in section 3(a)(50) of forth in paragraph (e)(1) of this section, the Securities Exchange Act of 1934 (15 the due diligence requirements of 31 U.S.C. 78c(a)(50)). U.S.C. 5318(i)(1) shall continue to apply (c) Foreign banks to be accorded en- to any covered financial institution hanced due diligence. The due diligence listed in § 1010.605(e)(1)(i) through (vi). procedures described in paragraph (b) (3) Special rules for all other covered fi- of this section are required for any cor- nancial institutions. The due diligence respondent account maintained for a requirements of 31 U.S.C. 5318(i)(1) foreign bank that operates under: shall not apply to a covered financial (1) An offshore banking license; institution listed in § 1010.605(e)(1)(vii) (2) A banking license issued by a for- through (x) until the requirements of eign country that has been designated paragraph (a) of this section become as non-cooperative with international applicable as set forth in paragraph anti-money laundering principles or (e)(1) of this section. procedures by an intergovernmental (f) Applicability rules for enhanced due group or organization of which the diligence. The provisions of paragraph United States is a member and with (b) of this section apply to covered fi- which designation the U.S. representa- nancial institutions as follows: tive to the group or organization con- (1) General rules—(i) Correspondent ac- curs; or counts established on or after February 5, (3) A banking license issued by a for- 2008. Effective February 5, 2008, the re- eign country that has been designated quirements of paragraph (b) of this sec- by the Secretary as warranting special tion shall apply to each correspondent measures due to money laundering con- account established on or after such cerns. date. (d) Special procedures when due dili- (ii) Correspondent accounts established gence or enhanced due diligence cannot before February 5, 2008. Effective May 5, be performed. The due diligence pro- 2008, the requirements of paragraph (b) gram required by paragraphs (a) and (b) of this section shall apply to each cor- of this section shall include procedures respondent account established before to be followed in circumstances in February 5, 2008. which a covered financial institution (2) Special rules for certain banks. cannot perform appropriate due dili- Until the requirements of paragraph (b)

622

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00632 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.620

of this section become applicable as set (2) Ascertain whether any person forth in paragraph (f)(1) of this section, identified under paragraph (b)(1) of this the enhanced due diligence require- section is a senior foreign political fig- ments of 31 U.S.C. 5318(i)(2) shall con- ure; tinue to apply to any covered financial (3) Ascertain the source(s) of funds institutions listed in § 1010.605(e)(1)(i) deposited into a private banking ac- through (vi). count and the purpose and expected use (3) Special rules for all other covered fi- of the account; and nancial institutions. The enhanced due (4) Review the activity of the account diligence requirements of 31 U.S.C. to ensure that it is consistent with the 5318(i)(2) shall not apply to a covered fi- information obtained about the client’s nancial institution listed in source of funds, and with the stated § 1010.605(e)(1)(vii) through (x) until the purpose and expected use of the ac- requirements of paragraph (b) of this count, as needed to guard against section become applicable, as set forth money laundering, and to report, in ac- in paragraph (f)(1) of this section. cordance with applicable law and regu- (g) Exemptions—(1) Exempt financial lation, any known or suspected money institutions. Except as provided in this laundering or suspicious activity con- section, a financial institution defined ducted to, from, or through a private in 31 U.S.C. 5312(a)(2) or (c)(1), or banking account. § 1010.100(t) is exempt from the require- (c) Special requirements for senior for- ments of 31 U.S.C. 5318(i)(1) and (i)(2) eign political figures. (1) In the case of a pertaining to correspondent accounts. private banking account for which a senior foreign political figure is a (2) Other compliance obligations of fi- nominal or beneficial owner, the due nancial institutions unaffected. Nothing diligence program required by para- in paragraph (g) of this section shall be graph (a) of this section shall include construed to relieve a financial institu- enhanced scrutiny of such account that tion from its responsibility to comply is reasonably designed to detect and re- with any other applicable requirement port transactions that may involve the of law or regulation, including title 31, proceeds of foreign corruption. United States Code, and this chapter. (2) For purposes of this paragraph (c), the term proceeds of foreign corruption § 1010.620 Due diligence programs for private banking accounts. means any asset or property that is ac- quired by, through, or on behalf of a (a) In general. A covered financial in- senior foreign political figure through stitution shall maintain a due dili- misappropriation, theft, or embezzle- gence program that includes policies, ment of public funds, the unlawful con- procedures, and controls that are rea- version of property of a foreign govern- sonably designed to detect and report ment, or through acts of bribery or ex- any known or suspected money laun- tortion, and shall include any other dering or suspicious activity conducted property into which any such assets through or involving any private bank- have been transformed or converted. ing account that is established, main- (d) Special procedures when due dili- tained, administered, or managed in gence cannot be performed. The due dili- the United States by such financial in- gence program required by paragraph stitution. The due diligence program (a) of this section shall include proce- required by this section shall be a part dures to be followed in circumstances of the anti-money laundering program in which a covered financial institution otherwise required by this chapter. cannot perform appropriate due dili- (b) Minimum requirements. The due gence with respect to a private banking diligence program required by para- account, including when the covered fi- graph (a) of this section shall be de- nancial institution should refuse to signed to ensure, at a minimum, that open the account, suspend transaction the financial institution takes reason- activity, file a suspicious activity re- able steps to: port, or close the account. (1) Ascertain the identity of all nomi- (e) Applicability rules. The provisions nal and beneficial owners of a private of this section apply to covered finan- banking account; cial institutions as follows:

623

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00633 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.630 31 CFR Ch. X (7–1–11 Edition)

(1) General rules—(i) Private banking account in the United States for, or on accounts established on or after July 5, behalf of, a foreign shell bank. 2006. Effective July 5, 2006, the require- (ii) A covered financial institution ments of this section shall apply to shall take reasonable steps to ensure each private banking account estab- that any correspondent account estab- lished on or after such date. lished, maintained, administered, or (ii) Private banking accounts estab- managed by that covered financial in- lished before July 5, 2006. Effective Oc- stitution in the United States for a for- tober 2, 2006, the requirements of this eign bank is not being used by that for- section shall apply to each private eign bank to indirectly provide bank- banking account established before ing services to a foreign shell bank. July 5, 2006. (iii) Nothing in paragraph (a)(1) of (2) Special rules for certain banks and this section prohibits a covered finan- for brokers or dealers in securities, futures cial institution from providing a cor- commission merchants, and introducing respondent account or banking services brokers. Until the requirements of this to a regulated affiliate. section become applicable as set forth (2) Records of owners and agents. (i) in paragraph (e)(1) of this section, the Except as provided in paragraph requirements of 31 U.S.C. 5318(i)(3) (a)(2)(ii) of this section, a covered fi- shall continue to apply to a covered fi- nancial institution that maintains a nancial institution listed in correspondent account in the United § 1010.605(e)(1)(i) through (vi), (viii), or States for a foreign bank shall main- (ix). tain records in the United States iden- (3) Special rules for federally regulated tifying the owners of each such foreign trust banks or trust companies, and mu- bank whose shares are not publicly tual funds. Until the requirements of traded and the name and street address this section become applicable as set of a person who resides in the United forth in paragraph (e)(1) of this section, States and is authorized, and has the requirements of 31 U.S.C. 5318(i)(3) agreed to be an agent to accept service shall not apply to a covered financial of legal process for records regarding institution listed in § 1010.605(e)(1)(vii) each such account. or (x). (ii) A covered financial institution (4) Exemptions—(i) Exempt financial in- need not maintain records of the own- stitutions. Except as provided in this ers of any foreign bank that is required section, a financial institution defined to have on file with the Federal Re- in 31 U.S.C. 5312(a)(2) or (c)(1) or serve Board a Form FR Y–7 that identi- § 1010.100(t) is exempt from the require- fies the current owners of the foreign ments of 31 U.S.C. 5318(i)(3) pertaining bank as required by such form. to private banking accounts. (iii) For purposes of paragraph (ii) Other compliance obligations of fi- (a)(2)(i) of this section, publicly traded nancial institutions unaffected. Nothing refers to shares that are traded on an in paragraph (e)(4) of this section shall exchange or on an organized over-the- be construed to relieve a financial in- counter market that is regulated by a stitution from its responsibility to foreign securities authority as defined comply with any other applicable re- quirement of law or regulation, includ- in section 3(a)(50) of the Securities Ex- ing title 31, United States Code, and change Act of 1934 (15 U.S.C. 78c(a)(50)). this chapter. (b) Safe harbor. Subject to paragraphs (c) and (d) of this section, a covered fi- § 1010.630 Prohibition on cor- nancial institution will be deemed to respondent accounts for foreign be in compliance with the require- shell banks; records concerning ments of paragraph (a) of this section owners of foreign banks and agents with respect to a foreign bank if the for service of legal process. covered financial institution obtains, (a) Requirements for covered financial at least once every three years, a cer- institutions—(1) Prohibition on cor- tification or recertification from the respondent accounts for foreign shell foreign bank. banks. (i) A covered financial institu- (c) Interim verification. If at any time tion shall not establish, maintain, ad- a covered financial institution knows, minister, or manage a correspondent suspects, or has reason to suspect, that

624

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00634 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.630

any information contained in a certifi- transactions necessary to close the ac- cation or recertification provided by a count. foreign bank, or otherwise relied upon (3) Verification of previously provided by the covered financial institution for information. In the case of a foreign purposes of this section, is no longer bank with respect to which the covered correct, the covered financial institu- financial institution undertakes to tion shall request that the foreign verify information pursuant to para- bank verify or correct such informa- graph (c) of this section, if the covered tion, or shall take other appropriate financial institution has not obtained, measures to ascertain the accuracy of from the foreign bank or otherwise, the information or to obtain correct in- verification of the information or cor- formation, as appropriate. See para- rected information within 90 calendar graph (d)(3) of this section for addi- days after the date of undertaking the tional requirements if a foreign bank verification, the covered financial in- fails to verify or correct the informa- stitution shall close all correspondent tion or if a covered financial institu- accounts with such foreign bank within tion cannot ascertain the accuracy of a commercially reasonable time, and the information or obtain correct in- shall not permit the foreign bank to es- formation. tablish any new positions or execute (d) Closure of correspondent accounts— any transaction through any such ac- (1) Accounts existing on October 28, 2002. count, other than transactions nec- In the case of any correspondent ac- essary to close the account. count that was in existence on October (4) Reestablishment of closed accounts 28, 2002, if the covered financial institu- and establishment of new accounts. A tion has not obtained a certification covered financial institution shall not (or recertification) from the foreign reestablish any account closed pursu- bank, or has not otherwise obtained ant to this paragraph (d), and shall not documentation of the information re- establish any other correspondent ac- quired by such certification (or recer- count with the concerned foreign bank, tification), on or before March 31, 2003, until it obtains from the foreign bank and at least once every three years the certification or the recertification, thereafter, the covered financial insti- as appropriate. tution shall close all correspondent ac- counts with such foreign bank within a (5) Limitation on liability. A covered fi- commercially reasonable time, and nancial institution shall not be liable shall not permit the foreign bank to es- to any person in any court or arbitra- tablish any new positions or execute tion proceeding for terminating a cor- any transaction through any such ac- respondent account in accordance with count, other than transactions nec- this paragraph (d). essary to close the account. (e) Recordkeeping requirement. A cov- (2) Accounts established after October ered financial institution shall retain 28, 2002. In the case of any cor- the original of any document provided respondent account established after by a foreign bank, and the original or October 28, 2002, if the covered finan- a copy of any document otherwise re- cial institution has not obtained a cer- lied upon by the covered financial in- tification (or recertification), or has stitution, for purposes of this section, not otherwise obtained documentation for at least 5 years after the date that of the information required by such the covered financial institution no certification (or recertification) within longer maintains any correspondent 30 calendar days after the date the ac- account for such foreign bank. A cov- count is established, and at least once ered financial institution shall retain every three years thereafter, the cov- such records with respect to any for- ered financial institution shall close eign bank for such longer period as the all correspondent accounts with such Secretary may direct. foreign bank within a commercially (f) Special rules concerning information reasonable time, and shall not permit requested prior to October 28, 2002—(1) the foreign bank to establish any new Definition. For purposes of this para- positions or execute any transaction graph (f) the term ‘‘Interim Guidance’’ through any such account, other than means:

625

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00635 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.640 31 CFR Ch. X (7–1–11 Edition)

(i) The Interim Guidance of the De- fined in section 5 of the Investment partment of the Treasury dated No- Company Act (15 U.S.C. 80a–5)) and vember 20, 2001 and published in the that is registered, or required to reg- FEDERAL REGISTER on November 27, ister, with the Securities and Exchange 2001; or Commission pursuant to that Act. (ii) The guidance issued in a docu- (b) Requirements for covered financial ment published in the FEDERAL REG- institutions—(1) Prohibition on cor- ISTER on December 28, 2001. respondent accounts. A covered financial (2) Use of Interim Guidance certifi- institution shall terminate any cor- cation. In the case of a correspondent respondent account that is established, account in existence on October 28, maintained, administered, or managed 2002, the term ‘‘certification’’ as used in the United States for, or on behalf in paragraphs (b), (c), (d)(1), and (d)(3) of, a Burmese banking institution. of this section shall also include the (2) Prohibition on indirect cor- certification appended to the Interim respondent accounts. (i) If a covered fi- Guidance, provided that such certifi- nancial institution has or obtains cation was requested prior to October knowledge that a correspondent ac- 28, 2002 and obtained by the covered fi- count established, maintained, admin- nancial institution on or before Decem- istered, or managed by that covered fi- ber 26, 2002. nancial institution in the United (3) Recordkeeping requirement. Para- States for a foreign bank is being used graph (e) of this section shall apply to by the foreign bank to provide banking any document provided by a foreign services indirectly to a Burmese bank- bank, or otherwise relied upon by a ing institution, the covered financial covered financial institution, for pur- institution shall ensure that the cor- poses of the Interim Guidance. respondent account is no longer used to provide such services, including, where § 1010.640 [Reserved] necessary, terminating the cor- SPECIAL MEASURES UNDER SECTION 311 respondent account; and OF THE USA PATRIOT ACT AND LAW (ii) A covered financial institution ENFORCEMENT ACCESS TO FOREIGN required to terminate an account pur- BANK RECORDS suant to paragraph (b)(2)(i) of this sec- tion: § 1010.651 Special measures against (A) Shall do so within a commer- Burma. cially reasonable time, and shall not (a) Definitions. For purposes of this permit the foreign bank to establish section: any new positions or execute any (1) Burmese banking institution means transactions through such account, any foreign bank, as that term is de- other than those necessary to close the fined in § 1010.100(u), chartered or li- account; and censed by Burma, including branches (B) May reestablish an account and offices located outside Burma. closed pursuant to this paragraph if it (2) Correspondent account has the determines that the account will not same meaning as provided in be used to provide banking services in- § 1010.605(c). directly to a Burmese banking institu- (3) Covered financial institution has tion. the same meaning as provided in (3) Exception. The provisions of para- § 1010.605(e)(2) and also includes the fol- graphs (b)(1) and (2) of this section lowing: shall not apply to a correspondent ac- (i) A futures commission merchant or count provided that the operation of an introducing broker registered, or re- such account is not prohibited by Exec- quired to register, with the Commodity utive Order 13310 and the transactions Futures Trading Commission under the involving Burmese banking institu- Commodity Exchange Act (7 U.S.C. 1 et tions that are conducted through the seq.); and correspondent account are limited (ii) An investment company (as de- solely to transactions that are exempt- fined in section 3 of the Investment ed from, or otherwise authorized by Company Act of 1940 (15 U.S.C. 80a–5)) regulation, order, directive, or license that is an open-end company (as de- pursuant to, Executive Order 13310.

626

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00636 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.653

(4) Reporting and recordkeeping not re- States for a foreign bank is being used quired. Nothing in this section shall re- by the foreign bank to provide banking quire a covered financial institution to services indirectly to Myanmar maintain any records, obtain any cer- Mayflower Bank or Asia Wealth Bank, tification, or report any information the covered financial institution shall not otherwise required by law or regu- ensure that the correspondent account lation. is no longer used to provide such serv- ices, including, where necessary, termi- § 1010.652 Special measures against nating the correspondent account; and Myanmar Mayflower Bank and Asia Wealth Bank. (ii) A covered financial institution required to terminate an account pur- (a) Definitions. For purposes of this suant to paragraph (b)(2)(i) of this sec- section: tion: (1) Asia Wealth Bank means all head- (A) Shall do so within a commer- quarters, branches, and offices of Asia cially reasonable time, and shall not Wealth Bank operating in Burma or in permit the foreign bank to establish any jurisdiction. any new positions or execute any (2) Correspondent account has the same meaning as provided in transactions through such account, § 1010.605(c). other than those necessary to close the (3) Covered financial institution has account; and the same meaning as provided in (B) May reestablish an account § 1010.605(e)(2) and also includes the fol- closed pursuant to this paragraph if it lowing: determines that the account will not (i) A futures commission merchant or be used to provide banking services in- an introducing broker registered, or re- directly to Myanmar Mayflower Bank quired to register, with the Commodity or Asia Wealth Bank. Futures Trading Commission under the (3) Reporting and recordkeeping not re- Commodity Exchange Act (7 U.S.C. 1 et quired. Nothing in this section shall re- seq.); and quire a covered financial institution to (ii) An investment company (as de- maintain any records, obtain any cer- fined in section 3 of the Investment tification, or to report any information Company Act of 1940 (15 U.S.C. 80a–5)) not otherwise required by law or regu- that is an open-end company (as de- lation. fined in section 5 of the Investment Company Act (15 U.S.C. 80a–5)) and § 1010.653 Special measures against that is registered, or required to reg- Commercial Bank of Syria. ister, with the Securities and Exchange (a) Definitions. For purposes of this Commission pursuant to that Act. section: (4) Myanmar Mayflower Bank means (1) Commercial Bank of Syria means all headquarters, branches, and offices any branch, office, or subsidiary of of Myanmar Mayflower Bank operating Commercial Bank of Syria operating in in Burma or in any jurisdiction. Syria or in any other jurisdiction, in- (b) Requirements for covered financial cluding Syrian Lebanese Commercial institutions—(1) Prohibition on cor- Bank. respondent accounts. A covered financial (2) Correspondent account has the institution shall terminate any cor- same meaning as provided in respondent account that is established, § 1010.605(c)(1)(ii). maintained, administered, or managed (3) Covered financial institution in- in the United States for, or on behalf cludes: of, Myanmar Mayflower Bank or Asia Wealth Bank. (i) An insured bank (as defined in sec- (2) Prohibition on indirect cor- tion 3(h) of the Federal Deposit Insur- respondent accounts. (i) If a covered fi- ance Act (12 U.S.C. 1813(h))); nancial institution has or obtains (ii) A commercial bank; knowledge that a correspondent ac- (iii) An agency or branch of a foreign count established, maintained, admin- bank in the United States; istered, or managed by that covered fi- (iv) A federally insured credit union; nancial institution in the United (v) A savings association;

627

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00637 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.654 31 CFR Ch. X (7–1–11 Edition)

(vi) A corporation acting under sec- Bank of Syria with access to the cov- tion 25A of the Federal Reserve Act (12 ered financial institution; and U.S.C. 611 et seq.); (B) Taking reasonable steps to iden- (vii) A trust bank or trust company tify any indirect use of its cor- that is federally regulated and is sub- respondent accounts by Commercial ject to an anti-money laundering pro- Bank of Syria, to the extent that such gram requirement; indirect use can be determined from (viii) A broker or dealer in securities transactional records maintained in registered, or required to be registered, the covered financial institution’s nor- with the Securities and Exchange Com- mal course of business. mission under the Securities Exchange (ii) A covered financial institution Act of 1934 (15 U.S.C. 78a et seq.), except shall take a risk-based approach when persons who register pursuant to sec- deciding what, if any, additional due tion 15(b)(11) of the Securities Ex- diligence measures it should adopt to change Act of 1934; guard against the indirect use of its (ix) A futures commission merchant correspondent accounts by Commercial or an introducing broker registered, or Bank of Syria. required to be registered, with the (iii) A covered financial institution Commodity Futures Trading Commis- that obtains knowledge that a cor- sion under the Commodity Exchange respondent account is being used by Act (7 U.S.C. 1 et seq.), except persons the foreign bank to provide indirect ac- who register pursuant to section cess to Commercial Bank of Syria shall 4(f)(a)(2) of the Commodity Exchange take all appropriate steps to prevent Act; and such indirect access, including, where (x) A mutual fund, which means an necessary, terminating the cor- investment company (as defined in sec- respondent account. tion 3(a)(1) of the Investment Company (iv) A covered financial institution Act of 1940 ((‘‘Investment Company required to terminate a correspondent Act’’) (15 U.S.C. 80a–3(a)(1))) that is an account pursuant to paragraph open-end company (as defined in sec- (b)(2)(iii) of this section: tion 5(a)(1) of the Investment Company (A) Should do so within a commer- Act (15 U.S.C. 80a–5(a)(1))) and that is cially reasonable time, and should not registered, or is required to register permit the foreign bank to establish with the Securities and Exchange Com- any new positions or execute any mission pursuant to the Investment transaction through such cor- Company Act. respondent account, other than those (4) Subsidiary means a company of necessary to close the correspondent which more than 50 percent of the vot- account; and ing stock or analogous equity interest (B) May reestablish a correspondent is owned by another company. account closed pursuant to this para- (b) Requirements for covered financial graph if it determines that the cor- institutions—(1) Prohibition on direct use respondent account will not be used to of correspondent accounts. A covered fi- provide banking services indirectly to nancial institution shall terminate any Commercial Bank of Syria. correspondent account that is open or (3) Recordkeeping and reporting. (i) A maintained in the United States for, or covered financial institution is re- on behalf of, Commercial Bank of quired to document its compliance Syria. with the notice requirement set forth (2) Due diligence of correspondent ac- in paragraph (b)(2)(i)(A) of this section. counts to prohibit indirect use. (i) A cov- (ii) Nothing in this section shall re- ered financial institution shall apply quire a covered financial institution to due diligence to its correspondent ac- report any information not otherwise counts that is reasonably designed to required to be reported by law or regu- guard against their indirect use by lation. Commercial Bank of Syria. At a min- imum, that due diligence must include: § 1010.654 Special measures against (A) Notifying correspondent account VEF Bank. holders that the correspondent account (a) Definitions. For purposes of this may not be used to provide Commercial section:

628

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00638 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.654

(1) Correspondent account has the branches or offices, are included in the same meaning as provided in definition. § 1010.605(c)(1)(ii). (b) Requirements for covered financial (2) Covered financial institution in- institutions—(1) Prohibition on direct use cludes: of correspondent accounts. A covered fi- (i) An insured bank (as defined in sec- nancial institution shall terminate any tion 3(h) of the Federal Deposit Insur- correspondent account that is opened ance Act (12 U.S.C. 1813(h))); or maintained in the United States for, (ii) A commercial bank; or on behalf of, VEF Bank. (iii) An agency or branch of a foreign (2) Due diligence of correspondent ac- bank in the United States; counts to prohibit indirect use. (i) A cov- (iv) A federally insured credit union; (v) A savings association; ered financial institution shall apply (vi) A corporation acting under sec- due diligence to its correspondent ac- tion 25A of the Federal Reserve Act (12 counts that is reasonably designed to U.S.C. 611 et seq.); guard against their indirect use by (vii) A trust bank or trust company VEF Bank. At a minimum, that due that is federally regulated and is sub- diligence must include: ject to an anti-money laundering pro- (A) Notifying correspondent gram requirement; accountholders that the correspondent (viii) A broker or dealer in securities account may not be used to provide registered, or required to be registered, VEF Bank with access to the covered with the U.S. Securities and Exchange financial institution; and Commission under the Securities Ex- (B) Taking reasonable steps to iden- change Act of 1934 (15 U.S.C. 78a et tify any indirect use of its cor- seq.), except persons who register pur- respondent accounts by VEF Bank, to suant to section 15(b)(11) of the Securi- the extent that such indirect use can ties Exchange Act of 1934; be determined from transactional (ix) A futures commission merchant records maintained in the covered fi- or an introducing broker registered, or nancial institution’s normal course of required to be registered, with the business. Commodity Futures Trading Commis- (ii) A covered financial institution sion under the Commodity Exchange Act (7 U.S.C. 1 et seq.), except persons shall take a risk-based approach when who register pursuant to section deciding what, if any, additional due 4(f)(a)(2) of the Commodity Exchange diligence measures it should adopt to Act; and guard against the indirect use of its (x) A mutual fund, which means an correspondent accounts by VEF Bank. investment company (as defined in sec- (iii) A covered financial institution tion 3(a)(1) of the Investment Company that obtains knowledge that a cor- Act of 1940 ((‘‘Investment Company respondent account is being used by Act’’) (15 U.S.C. 80a–3(a)(1))) that is an the foreign bank to provide indirect ac- open-end company (as defined in sec- cess to VEF Bank shall take all appro- tion 5(a)(1) of the Investment Company priate steps to prevent such indirect Act (15 U.S.C. 80a–5(a)(1))) and that is access, including, where necessary, ter- registered, or is required to register minating the correspondent account. with the Securities and Exchange Com- (iv) A covered financial institution mission pursuant to the Investment required to terminate a correspondent Company Act. account pursuant to paragraph (3) Subsidiary means a company of (b)(2)(iii) of this section: which more than 50 percent of the vot- (A) Should do so within a commer- ing stock or analogous equity interest cially reasonable time, and should not is owned by another company. (4) VEF Bank means any branch, of- permit the foreign bank to establish fice, or subsidiary of joint stock com- any new positions or execute any pany VEF Banka operating in the Re- transaction through such cor- public of Latvia or in any other juris- respondent account, other than those diction. The one known VEF Bank sub- necessary to close the correspondent sidiary, Veiksmes lzings, and any account; and

629

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00639 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.655 31 CFR Ch. X (7–1–11 Edition)

(B) May reestablish a correspondent under the Commodity Exchange Act (7 account closed pursuant to this para- U.S.C. 1 et seq.), except persons who graph if it determines that the cor- register pursuant to section 4(f)(a)(2) of respondent account will not be used to the Commodity Exchange Act; and provide banking services indirectly to (x) A mutual fund, which means an VEF Bank. investment company (as defined in sec- (3) Recordkeeping and reporting. (i) A tion 3(a)(1) of the Investment Company covered financial institution is re- Act of 1940 ((‘‘Investment Company quired to document its compliance Act’’) (15 U.S.C. 80a–3(a)(1))) that is an with the notice requirement set forth open-end company (as defined in sec- in paragraph (b)(2)(i)(A) of this section. tion 5(a)(1) of the Investment Company (ii) Nothing in this section shall re- Act (15 U.S.C. 80a–5(a)(1))) and that is quire a covered financial institution to registered, or is required to register report any information not otherwise with the Securities and Exchange Com- required to be reported by law or regu- mission pursuant to the Investment lation. Company Act. (4) Subsidiary means a company of § 1010.655 Special measures against which more than 50 percent of the vot- Banco Delta Asia. ing stock or analogous equity interest (a) Definitions. For purposes of this is owned by another company. section: (b) Requirements for covered financial (1) Banco Delta Asia means all institutions—(1) Prohibition on direct use branches, offices, and subsidiaries of of correspondent accounts. A covered fi- Banco Delta Asia operating in any ju- nancial institution shall terminate any risdiction, including its subsidiaries correspondent account that is estab- Delta Asia Credit Limited and Delta lished, maintained, administered, or Asia Insurance Limited. managed in the United States for, or (2) Correspondent account has the on behalf of, Banco Delta Asia. same meaning as provided in (2) Due diligence of correspondent ac- § 1010.605(c)(1)(ii). counts to prohibit indirect use. (i) A cov- (3) Covered financial institution in- ered financial institution shall apply cludes: due diligence to its correspondent ac- (i) An insured bank (as defined in sec- counts that is reasonably designed to tion 3(h) of the Federal Deposit Insur- guard against their indirect use by ance Act (12 U.S.C. 1813(h))); Banco Delta Asia. At a minimum, that (ii) A commercial bank; due diligence must include: (iii) An agency or branch of a foreign (A) Notifying correspondent bank in the United States; accountholders the correspondent ac- (iv) A federally insured credit union; count may not be used to provide (v) A savings association; Banco Delta Asia with access to the (vi) A corporation acting under sec- covered financial institution; and tion 25A of the Federal Reserve Act (12 (B) Taking reasonable steps to iden- U.S.C. 611 et seq.); tify any indirect use of its cor- (vii) A trust bank or trust company respondent accounts by Banco Delta that is federally regulated and is sub- Asia, to the extent that such indirect ject to an anti-money laundering pro- use can be determined from trans- gram requirement; actional records maintained in the cov- (viii) A broker or dealer in securities ered financial institution’s normal registered, or required to be registered, course of business. with the U.S. Securities and Exchange (ii) A covered financial institution Commission under the Securities Ex- shall take a risk-based approach when change Act of 1934 (15 U.S.C. 78a et deciding what, if any, additional due seq.), except persons who register pur- diligence measures it should adopt to suant to section 15(b)(11) of the Securi- guard against the indirect use of its ties Exchange Act of 1934; correspondent accounts by Banco Delta (ix) A futures commission merchant Asia. or an introducing broker registered, or (iii) A covered financial institution required to register, with the Com- that obtains knowledge that a cor- modity Futures Trading Commission respondent account is being used by

630

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00640 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.711

the foreign bank to provide indirect ac- (c) Issuance to covered financial insti- cess to Banco Delta Asia shall take all tutions. Upon receipt of a written re- appropriate steps to prevent such indi- quest from a Federal law enforcement rect access, including, where necessary, officer for information required to be terminating the correspondent ac- maintained by a covered financial in- count. stitution under paragraph (a)(2) of (iv) A covered financial institution § 1010.630, the covered financial institu- required to terminate a correspondent tion shall provide the information to account pursuant to paragraph the requesting officer not later than 7 (b)(2)(iii) of this section: days after receipt of the request. (A) Should do so within a commer- (d) Termination upon receipt of notice. cially reasonable time, and should not A covered financial institution shall permit the foreign bank to establish terminate any correspondent relation- ship with a foreign bank not later than any new positions or execute any 10 business days after receipt of writ- transaction through such cor- ten notice from the Secretary or the respondent account, other than those Attorney General (in each case, after necessary to close the correspondent consultation with the other) that the account; and foreign bank has failed: (B) May reestablish a correspondent (1) To comply with a summons or account closed pursuant to this para- subpoena issued under paragraph (b) of graph if it determines that the cor- this section; or respondent account will not be used to (2) To initiate proceedings in a provide banking services indirectly to United States court contesting such Banco Delta Asia. summons or subpoena. (3) Recordkeeping and reporting. (i) A (e) Limitation on liability. A covered fi- covered financial institution is re- nancial institution shall not be liable quired to document its compliance to any person in any court or arbitra- with the notice requirement set forth tion proceeding for terminating a cor- in paragraph (b)(2)(i)(A) of this section. respondent relationship in accordance (ii) Nothing in this section shall re- with paragraph (d) of this section. quire a covered financial institution to (f) Failure to terminate relationship. report any information not otherwise Failure to terminate a correspondent required to be reported by law or regu- relationship in accordance with this lation. section shall render the covered finan- cial institution liable for a civil pen- § 1010.670 Summons or subpoena of alty of up to $10,000 per day until the foreign bank records; termination correspondent relationship is so termi- of correspondent relationship. nated. (a) Definitions. The definitions in § 1010.605 apply to this section. Subpart G—Administrative Rulings (b) Issuance to foreign banks. The Sec- retary or the Attorney General may § 1010.710 Scope. issue a summons or subpoena to any This subpart provides that the Direc- foreign bank that maintains a cor- tor, FinCEN, or his designee, either respondent account in the United unilaterally or upon request, may issue States and may request records related administrative rulings interpreting the to such correspondent account, includ- application of this chapter. ing records maintained outside of the United States relating to the deposit of § 1010.711 Submitting requests. funds into the foreign bank. The sum- (a) Each request for an administra- mons or subpoena may be served on the tive ruling must be in writing and con- foreign bank in the United States if the tain the following information: foreign bank has a representative in (1) A complete description of the sit- the United States, or in a foreign coun- uation for which the ruling is re- try pursuant to any mutual legal as- quested, sistance treaty, multilateral agree- (2) A complete statement of all mate- ment, or other request for inter- rial facts related to the subject trans- national law enforcement assistance. action,

631

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00641 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.712 31 CFR Ch. X (7–1–11 Edition)

(3) A concise and unambiguous ques- cause by FinCEN, shall be treated as tion to be answered, though it were withdrawn. (4) A statement certifying, to the best of the requestor’s knowledge and § 1010.713 Oral communications. belief, that the question to be answered (a) The Director of FinCEN or his is not applicable to any ongoing state designee will not issue administrative or Federal investigation, litigation, rulings in response to oral requests. grand jury proceeding, or proceeding Oral opinions or advice by Treasury, before any other governmental body in- Customs and Border Protection, the In- volving either the requestor, any other ternal Revenue Service, the Office of party to the subject transaction, or the Comptroller of the Currency, or any other party with whom the re- any other bank supervisory agency per- questor has an agency relationship, sonnel, regarding the interpretation (5) A statement identifying any infor- and application of this chapter, do not mation in the request that the re- bind FinCEN and carry no precedential questor considers to be exempt from value. disclosure under the Freedom of Infor- (b) A person who has made a ruling mation Act, 5 U.S.C. 552, and the rea- request in conformity with § 1010.711 son therefor, may request an opportunity for oral (6) If the subject situation is hypo- discussion of the issues presented in thetical, a statement justifying why the request. The request should be the particular situation described war- made to the Director, FinCEN, and any rants the issuance of a ruling, decision to grant such a conference is (7) The signature of the person mak- wholly within the discretion of the Di- ing the request, or rector. Personal conferences or tele- (8) If an agent makes the request, the phone conferences may be scheduled signature of the agent and a statement only for the purpose of affording the re- certifying the authority under which quester an opportunity to discuss free- the request is made. ly and openly the matters set forth in (b) A request filed by a corporation the administrative ruling request. Ac- shall be signed by a corporate officer cordingly, the conferees will not be and a request filed by a partnership bound by any argument or position ad- shall be signed by a partner. vocated or agreed to, expressly or (c) A request may advocate a par- impliedly, during the conference. Any ticular proposed interpretation and new arguments or facts put forth by may set forth the legal and factual the requester at the meeting must be basis for that interpretation. reduced to writing by the requester and (d) Requests shall be addressed to: submitted in conformity with § 1010.711 Director, Financial Crimes Enforce- before they may be considered in con- ment Network, P.O. Box 39, Vienna, VA nection with the request. 22183. (e) The requester shall advise the Di- § 1010.714 Withdrawing requests. rector, FinCEN, immediately in writ- A person may withdraw a request for ing of any subsequent change in any an administrative ruling at any time material fact or statement submitted before the ruling has been issued. with a ruling request in conformity with paragraph (a) of this section. § 1010.715 Issuing rulings. The Director, FinCEN, or his des- § 1010.712 Nonconforming requests. ignee may issue a written ruling inter- The Director, FinCEN, or his des- preting the relationship between this ignee shall notify the requester if the chapter and each situation for which ruling request does not conform with such a ruling has been requested in the requirements of § 1010.711. The no- conformity with § 1010.711. A ruling tice shall be in writing and shall de- issued under this section shall bind scribe the requirements that have not FinCEN only in the event that the re- been met. A request that is not brought quest describes a specifically identified into conformity with such require- actual situation. A ruling issued under ments within 30 days from the date of this section shall have precedential such notice, unless extended for good value, and hence may be relied upon by

632

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00642 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.810

others similarly situated, only if to any fact or statement in the original FinCEN makes it available to the pub- request, or lic through publication on the FinCEN (3) A party to the original request Web site under the heading ‘‘Adminis- acted in bad faith when relying upon trative rulings’’ or other appropriate the ruling. forum. All rulings with precedential value will be available by mail to any § 1010.717 Disclosing information. person upon written request specifi- (a) Any part of any administrative cally identifying the ruling sought. ruling, including names, addresses, or FinCEN will make every effort to re- spond to each requestor within 90 days information related to the business of receiving a request. transactions of private parties, may be disclosed pursuant to a request under (Approved by the Office of Management and the Freedom of Information Act, 5 Budget under control number 1506–0009) U.S.C. 552. If the request for an admin- istrative ruling contains information § 1010.716 Modifying or rescinding rul- ings. which the requestor wishes to be con- sidered for exemption from disclosure (a) The Director, FinCEN, or his des- under the Freedom of Information Act, ignee may modify or rescind any ruling the requestor should clearly identify made pursuant to § 1010.715: such portions of the request and the (1) When, in light of changes in the reasons why such information should statute or regulations, the ruling no be exempt from disclosure. longer sets forth the interpretation of the Director, FinCEN with respect to (b) A requestor claiming an exemp- the described situation, tion from disclosure will be notified, at (2) When any fact or statement sub- least 10 days before the administrative mitted in the original ruling request is ruling is issued, of a decision not to ex- found to be materially inaccurate or empt any of such information from dis- incomplete, or closure so that the underlying request (3) For other good cause. for an administrative ruling can be (b) Any person may submit to the Di- withdrawn if the requestor so chooses. rector, FinCEN a written request that an administrative ruling be modified or Subpart H—Enforcement; rescinded. The request should conform Penalties; and Forfeiture to the requirements of § 1010.711, ex- plain why rescission or modification is § 1010.810 Enforcement. warranted, and refer to any reasons in (a) Overall authority for enforcement paragraph (a) of this section that are and compliance, including coordination relevant. The request may advocate an and direction of procedures and activi- alternative interpretation and may set ties of all other agencies exercising forth the legal and factual basis for delegated authority under this chapter, that interpretation. is delegated to the Director, FinCEN. (c) FinCEN shall modify an existing administrative ruling by issuing a new (b) Authority to examine institutions ruling that rescinds the relevant prior to determine compliance with the re- ruling. Once rescinded, an administra- quirements of this chapter is delegated tive ruling shall no longer have any as follows: precedential value. (1) To the Comptroller of the Cur- (d) An administrative ruling may be rency with respect to those financial modified or rescinded retroactively institutions regularly examined for with respect to one or more parties to safety and soundness by national bank the original ruling request if the Direc- examiners; tor, FinCEN, determines that: (2) To the Board of Governors of the (1) A fact or statement in the origi- Federal Reserve System with respect nal ruling request was materially inac- to those financial institutions regu- curate or incomplete, larly examined for safety and sound- (2) The requestor failed to notify in ness by Federal Reserve bank exam- writing FinCEN of a material change iners;

633

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00643 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.820 31 CFR Ch. X (7–1–11 Edition)

(3) To the Federal Deposit Insurance of any of the requirements of this chap- Corporation with respect to those fi- ter may be submitted to the Director, nancial institutions regularly exam- FinCEN at any time. ined for safety and soundness by FDIC (f) The Director, FinCEN or his dele- bank examiners; gate, and any agency to which compli- (4) To the Federal Home Loan Bank ance has been delegated under para- Board with respect to those financial graph (b) of this section, may examine institutions regularly examined for any books, papers, records, or other safety and soundness by FHLBB bank data of domestic financial institutions examiners; relevant to the recordkeeping or re- (5) To the Chairman of the Board of porting requirements of this chapter. the National Credit Union Administra- (g) The authority to enforce the pro- tion with respect to those financial in- visions of 31 U.S.C. 5314 and §§ 1010.350 stitutions regularly examined for safe- and 1010.420 of this chapter has been re- ty and soundness by NCUA examiners. delegated from FinCEN to the Commis- (6) To the Securities and Exchange sioner of Internal Revenue by means of Commission with respect to brokers a Memorandum of Agreement between and dealers in securities and invest- FinCEN and IRS. Such authority in- ment companies as that term is defined cludes, with respect to 31 U.S.C. 5314 in the Investment Company Act of 1940 and 1010.350 and 1010.420 of this chapter, (15 U.S.C. 80–1 et seq.); the authority to: assess and collect (7) To the Commissioner of Customs civil penalties under 31 U.S.C. 5321 and and Border Protection with respect to 31 CFR 1010.820; investigate possible §§ 1010.340 and 1010.830; civil violations of these provisions (in (8) To the Commissioner of Internal addition to the authority already pro- Revenue with respect to all financial vided at paragraph (c)(2)) of this sec- institutions, except brokers or dealers tion); employ the summons power of in securities, mutual funds, futures subpart I of this part 1010; issue admin- commission merchants, introducing istrative rulings under subpart G of brokers in commodities, and com- this part 1010; and take any other ac- modity trading advisors, not currently tion reasonably necessary for the en- examined by Federal bank supervisory forcement of these and related provi- agencies for soundness and safety; and sions, including pursuit of injunctions. (9) To the Commodity Futures Trad- ing Commission with respect to futures § 1010.820 Civil penalty. commission merchants, introducing (a) For any willful violation, com- brokers in commodities, and com- mitted on or before October 12, 1984, of modity trading advisors. any reporting requirement for financial (c) Authority for investigating crimi- institutions under this chapter or of nal violations of this chapter is dele- any recordkeeping requirements of gated as follows: §§ 1010.311, 1010.313, 1020.315, 1021.311 or (1) To the Commissioner of Customs 1021.313, the Secretary may assess upon and Border Protection with respect to any domestic financial institution, and § 1010.340; upon any partner, director, officer, or (2) To the Commissioner of Internal employee thereof who willfully partici- Revenue except with respect to pates in the violation, a civil penalty § 1010.340. not to exceed $1,000. (d) Authority for the imposition of (b) For any willful violation com- civil penalties for violations of this mitted after October 12, 1984 and before chapter lies with the Director of October 28, 1986, of any reporting re- FinCEN. quirement for financial institutions (e) Periodic reports shall be made to under this chapter or of the record- the Director, FinCEN by each agency keeping requirements of § 1010.420, the to which compliance authority has Secretary may assess upon any domes- been delegated under paragraph (b) of tic financial institution, and upon any this section. These reports shall be in partner, director, officer, or employee such a form and submitted at such in- thereof who willfully participates in tervals as the Director, FinCEN may the violation, a civil penalty not to ex- direct. Evidence of specific violations ceed $10,000.

634

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00644 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.840

(c) For any willful violation of any to be provided with respect to such ac- recordkeeping requirement for finan- count, a civil penalty not to exceed the cial institutions, except violations of greater of the amount (not to exceed § 1010.420, under this chapter, the Sec- $100,000) equal to the balance in the ac- retary may assess upon any domestic count at the time of the violation, or financial institution, and upon any $25,000. partner, director, officer, or employee (h) For each negligent violation of thereof who willfully participates in any requirement of this chapter, com- the violation, a civil penalty not to ex- mitted after October 27, 1986, the Sec- ceed $1,000. retary may assess upon any financial (d) For any failure to file a report re- institution a civil penalty not to ex- quired under § 1010.340 or for filing such ceed $500. a report containing any material omis- sion or misstatement, the Secretary § 1010.830 Forfeiture of currency or may assess a civil penalty up to the monetary instruments. amount of the currency or monetary Any currency or other monetary in- instruments transported, mailed or struments which are in the process of shipped, less any amount forfeited any transportation with respect to under § 1010.830. which a report is required under (e) For any willful violation of § 1010.340 are subject to seizure and for- § 1010.314 committed after January 26, feiture to the United States if such re- 1987, the Secretary may assess upon port has not been filed as required in any person a civil penalty not to ex- § 1010.360, or contains material omis- ceed the amount of coins and currency sions or misstatements. The Secretary involved in the transaction with re- may, in his sole discretion, remit or spect to which such penalty is imposed. mitigate any such forfeiture in whole The amount of any civil penalty as- or in part upon such terms and condi- sessed under this paragraph shall be re- tions as he deems reasonable. duced by the amount of any forfeiture to the United States in connection § 1010.840 Criminal penalty. with the transaction for which the pen- (a) Any person who willfully violates alty was imposed. any provision of Title I of Public Law (f) For any willful violation com- 91–508, or of this chapter authorized mitted after October 27, 1986, of any re- thereby may, upon conviction thereof, porting requirement for financial insti- be fined not more than $1,000 or be im- tutions under this chapter (except prisoned not more than 1 year, or both. § 1010.350, § 1010.360 or § 1010.420), the Such person may in addition, if the Secretary may assess upon any domes- violation is of any provision authorized tic financial institution, and upon any by Title I of Public Law 91–508 and if partner, director, officer, or employee the violation is committed in further- thereof who willfully participates in ance of the commission of any viola- the violation, a civil penalty not to ex- tion of Federal law punishable by im- ceed the greater of the amount (not to prisonment for more than 1 year, be exceed $100,000) involved in the trans- fined not more than $10,000 or be im- action or $25,000. prisoned not more than 5 years, or (g) For any willful violation com- both. mitted after October 27, 1986, of any re- (b) Any person who willfully violates quirement of § 1010.350, § 1010.360 or any provision of Title II of Public Law § 1010.420, the Secretary may assess 91–508, or of this chapter authorized upon any person, a civil penalty: thereby, may, upon conviction thereof, (1) In the case of a violation of be fined not more than $250,000 or be § 1010.360 involving a transaction, a imprisoned not more than 5 years, or civil penalty not to exceed the greater both. of the amount (not to exceed $100,000) (c) Any person who willfully violates of the transaction, or $25,000; and any provision of Title II of Public Law (2) In the case of a violation of 91–508, or of this chapter authorized § 1010.350 or § 1010.420 involving a failure thereby, where the violation is either to report the existence of an account or (1) Committed while violating an- any identifying information required other law of the United States, or

635

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00645 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.850 31 CFR Ch. X (7–1–11 Edition)

(2) Committed as part of a pattern of Subpart I—Summons any illegal activity involving more than $100,000 in any 12-month period, § 1010.911 General. may, upon conviction thereof, be fined For any investigation for the purpose not more than $500,000 or be imprisoned of civil enforcement of violations of not more than 10 years, or both. the Bank Secrecy Act, or any regula- (d) Any person who knowingly makes tion issued pursuant to the Bank Se- any false, fictitious or fraudulent crecy Act, the Secretary or delegate of statement or representation in any re- the Secretary may summon a financial port required by this chapter may, institution or an officer or employee of upon conviction thereof, be fined not a financial institution (including a more than $10,000 or be imprisoned not former officer or employee), or any per- more than 5 years, or both. son having possession, custody, or care of any of the records and reports re- § 1010.850 Enforcement authority with quired under the Bank Secrecy Act or respect to transportation of cur- this chapter to appear before the Sec- rency or monetary instruments. retary or his delegate, at a time and place named in the summons, and to (a) If a customs officer has reason- give testimony, under oath, and be ex- able cause to believe that there is a amined, and to produce such books, pa- monetary instrument being trans- pers, records, or other data as may be ported without the filing of the report relevant or material to such investiga- required by §§ 1010.340 and 1010.360 of tion. this chapter, he may stop and search, without a search warrant, a vehicle, § 1010.912 Persons who may issue sum- vessel, aircraft, or other conveyance, mons. envelope or other container, or person For purposes of this chapter, the fol- entering or departing from the United lowing officials are hereby designated States with respect to which or whom as delegates of the Secretary who are the officer reasonably believes is trans- authorized to issue a summons under porting such instrument. § 1010.911, solely for the purposes of (b) If the Secretary has reason to be- civil enforcement of this chapter: lieve that currency or monetary in- (a) FinCEN. The Director, FinCEN. (b) Internal Revenue Service. Except struments are in the process of trans- with respect to § 1010.340 of this chap- portation and with respect to which a ter, the Commissioner, the Deputy report required under § 1010.340 has not Commissioner, or a delegate of either been filed or contains material omis- official, and, for the purposes of per- sions or misstatements, he may apply fecting seizures and forfeitures related to any court of competent jurisdiction to civil enforcement of this chapter, for a search warrant. Upon a showing the Chief (Criminal Investigation) or a of probable cause, the court may issue delegate. a warrant authorizing the search of (c) Customs and Border Protection. any or all of the following: With respect to § 1010.340 of this chap- (1) One or more designated persons. ter, the Commissioner, the Deputy (2) One or more designated or de- Commissioner, the Assistant Commis- scribed places or premises. sioner (Enforcement), Regional Com- (3) One or more designated or de- missioners, Assistant Regional Com- scribed letters, parcels, packages, or missioners (Enforcement), and Special other physical objects. Agents in Charge. (4) One or more designated or de- § 1010.913 Contents of summons. scribed vehicles. Any application for a search warrant pursuant to this section (a) Summons for testimony. Any sum- shall be accompanied by allegations of mons issued under § 1010.911 of this chapter to compel the appearance and fact supporting the application. testimony of a person shall state: (c) This section is not in derogation (1) The name, title, address, and tele- of the authority of the Secretary under phone number of the person before any other law or regulation. whom the appearance shall take place

636

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00646 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.915

(who may be a person other than the agent, or any other agent authorized to persons who are authorized to issue receive service of process. such a summons under § 1010.912 of this (c) Certificate of service. The summons chapter); shall contain a certificate of service to (2) The address to which the person be signed by the server of the sum- summoned shall report for the appear- mons. On the hearing of an application ance; for enforcement of the summons, the (3) The date and time of the appear- certificate of service signed by the per- ance; and son serving the summons shall be evi- (4) The name, title, address, and tele- dence of the facts it states. phone number of the person who has issued the summons. § 1010.915 Examination of witnesses (b) Summons of books, papers, records, and records. or data. Any summons issued under (a) General. Any delegate of the Sec- § 1010.911 of this chapter to require the retary authorized under § 1010.912 of production of books, papers, records, or this chapter to issue a summons, or other data shall describe the materials any officer or employee of the Treasury to be produced with reasonable speci- Department or any component thereof ficity, and shall state: who is designated by that person (1) The name, title, address, and tele- (whether in the summons or other- phone number of the person to whom wise), is hereby authorized to receive the materials shall be produced (who evidence and to examine witnesses pur- may be a person other than the persons suant to the summons. Any person au- who are authorized to issue such a thorized by law may administer any summons under § 1010.912 of this chap- oaths and affirmations that may be re- ter); quired under this subpart. (2) The address at which the person (b) Testimony taken under oath. Testi- summoned shall produce the materials, mony of any person under this chapter not to exceed 500 miles from any place may be taken under oath, and shall be where the financial institution oper- taken down in writing by the person ates or conducts business in the United examining the person summoned or States; shall be otherwise transcribed. After (3) The specific manner of produc- the testimony of a witness has been tion, whether by personal delivery, by transcribed, a copy of that transcript mail, or by messenger service; shall be made available to the witness (4) The date and time for production; upon request, unless for good cause the and person issuing the summons deter- (5) The name, title, address, and tele- mines, under 5 U.S.C. 555, that a copy phone number of the person who has should not be provided. If such a deter- issued the summons. mination has been made, the witness shall be limited to inspection of the of- § 1010.914 Service of summons. ficial transcript of the testimony. (a) Who may serve. Any delegate of (c) Disclosure of summons, testimony, or the Secretary authorized under records. Unless the Secretary or a dele- § 1010.912 of this chapter to issue a sum- gate of the Secretary listed under mons, or any other person authorized § 1010.912(a) of this chapter so author- by law to serve summonses or other izes in writing, or it is otherwise re- process, is hereby authorized to serve a quired by law, no delegate of the Sec- summons issued under this chapter. retary listed under § 1010.912 (b) or (c) of (b) Manner of service. Service of a this chapter or other officer or em- summons may be made— ployee of the Treasury Department or (1) Upon any person, by registered any component thereof shall— mail, return receipt requested, directed (1) Make public the name of any per- to the person summoned; son to whom a summons has been (2) Upon a natural person by personal issued under this chapter, or release delivery; or any information to the public con- (3) Upon any other person by delivery cerning that person or the issuance of to an officer, managing or general a summons to that person prior to the

637

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00647 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.916 31 CFR Ch. X (7–1–11 Edition)

time and date set for that person’s ap- thereof. All process in any case under pearance or production of records; or this section may be served in any judi- (2) Disclose any testimony taken (in- cial district in which such person may cluding the name of the witness) or be found. material presented pursuant to the summons, to any person other than an § 1010.917 Payment of expenses. officer or employee of the Treasury De- Persons summoned under this chap- partment or of any component thereof. ter shall be paid the same fees and Nothing in the preceding sentence shall preclude a delegate of the Secretary, or mileage for travel in the United States other officer or employee of the Treas- that are paid witnesses in the courts of ury Department or any component the United States. The United States thereof, from disclosing testimony shall not be liable for any other ex- taken, or material presented pursuant pense incurred in connection with the to a summons issued under this chap- production of books, papers, records, or ter, to any person in order to obtain other data under this chapter. necessary information for investigative purposes relating to the performance of Subpart J—Miscellaneous official duties, or to any officer or em- ployee of the Department of Justice in § 1010.920 Access to records. connection with a possible violation of Except as provided in §§ 1020.410(b)(1), Federal law. 1021.410(a), and 1023.410(a)(1), and except § 1010.916 Enforcement of summons. for the purpose of assuring compliance with the recordkeeping and reporting In the case of contumacy by, or re- requirements of this chapter, this fusal to obey a summons issued to, any person under this chapter, the Sec- chapter does not authorize the Sec- retary or any delegate of the Secretary retary or any other person to inspect listed under § 1010.912 of this chapter or review the records required to be shall refer the matter to the Attorney maintained by this chapter. Other in- General or delegate of the Attorney spection, review or access to such General (including any United States records is governed by other applicable Attorney or Assistant United States law. Attorney, as appropriate), who may bring an action to compel compliance § 1010.930 Rewards for informants. with the summons in any court of the (a) If an individual provides original United States within the jurisdiction information which leads to a recovery of which the investigation which gave of a criminal fine, civil penalty, or for- rise to the summons being or has been feiture, which exceeds $50,000, for a vio- carried on, the jurisdiction in which lation of the provisions of the Bank Se- the person summoned is a resident, or crecy Act or of this chapter, the Sec- the jurisdiction in which the person retary may pay a reward to that indi- summoned carries on business or may vidual. be found. When a referral is made by a (b) The Secretary shall determine the delegate of the Secretary other than a delegate named in § 1010.912(a) of this amount of the reward to be paid under chapter, prompt notification of the re- this section; however, any reward paid ferral must be made to the Director, may not be more than 25 percent of the FinCEN. The court may issue an order net amount of the fine, penalty or for- requiring the person summoned to ap- feiture collected, or $150,000, whichever pear before the Secretary or delegate is less. of the Secretary to produce books, pa- (c) An officer or employee of the pers, records, or other data, to give tes- United States, a State, or a local gov- timony as may be necessary in order to ernment who provides original infor- explain how such material was com- mation described in paragraph (a) in piled and maintained, and to pay the the performance of official duties is costs of the proceeding. Any failure to not eligible for a reward under this sec- obey the order of the court may be tion. punished by the court as a contempt

638

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00648 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 Financial Crimes Enforcement Network, Treasury § 1010.970

§ 1010.940 Photographic or other re- (e) Any information made available productions of Government obliga- under this section to other department tions. or agencies of the United States, any Nothing herein contained shall re- state or local government, or any for- quire or authorize the microfilming or eign government shall be received by other reproduction of: them in confidence, and shall not be (a) Currency or other obligation or disclosed to any person except for offi- security of the United States as defined cial purposes relating to the investiga- in 18 U.S.C. 8, or tion, proceeding or matter in connec- tion with which the information is (b) Any obligation or other security sought. of any foreign government, the repro- (f) The Secretary may require that a duction of which is prohibited by law. State or local government department § 1010.950 Availability of information. or agency requesting information under paragraph (b) of this section pay (a) The Secretary may within his dis- fees to reimburse the Department of cretion disclose information reported the Treasury for costs incidental to under this chapter for any reason con- such disclosure. The amount of such sistent with the purposes of the Bank fees will be set in accordance with the Secrecy Act, including those set forth statute on fees for government serv- in paragraphs (b) through (d) of this ices, 31 U.S.C. 9701. section. (b) The Secretary may make any in- § 1010.960 Disclosure. formation set forth in any report re- All reports required under this chap- ceived pursuant to this chapter avail- ter and all records of such reports are able to another agency of the United specifically exempted from disclosure States, to an agency of a state or local under section 552 of Title 5, United government or to an agency of a for- States Code. eign government, upon the request of the head of such department or agency § 1010.970 Exceptions, exemptions, and made in writing and stating the par- reports. ticular information desired, the crimi- (a) The Secretary, in his sole discre- nal, tax or regulatory purpose for tion, may by written order or author- which the information is sought, and ization make exceptions to or grant ex- the official need for the information. emptions from the requirements of this (c) The Secretary may make any in- chapter. Such exceptions or exemp- formation set forth in any report re- tions may be conditional or uncondi- ceived pursuant to this chapter avail- tional, may apply to particular persons able to the Congress, or any committee or to classes of persons, and may apply or subcommittee thereof, upon a writ- to particular transactions or classes of ten request stating the particular in- transactions. They shall, however, be formation desired, the criminal, tax or applicable only as expressly Stated in regulatory purpose for which the infor- the order of authorization, and they mation is sought, and the official need shall be revocable in the sole discretion for the information. of the Secretary. (d) The Secretary may make any in- (b) The Secretary shall have author- formation set forth in any report re- ity to further define all terms used ceived pursuant to this chapter avail- herein. able to any other department or agen- (c)(1) The Secretary may, as an alter- cy of the United States that is a mem- native to the reporting and record- ber of the Intelligence Community, as keeping requirements for casinos in defined by Executive Order 12333 or any §§ 1010.306(a), 1021.311, and 1021.410, succeeding executive order, upon the grant exemptions to the casinos in any request of the head of such department State whose regulatory system sub- or agency made in writing and stating stantially meets the reporting and rec- the particular information desired, the ordkeeping requirements of this chap- national security matter with which ter. the information is sought and the offi- (2) In order for a State regulatory cial need therefor. system to qualify for an exemption on

639

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00649 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150 § 1010.980 31 CFR Ch. X (7–1–11 Edition)

behalf of its casinos, the State must Subpart B—Programs provide: 1020.200 General. (i) That the Treasury Department be 1020.210 Anti-money laundering program re- allowed to evaluate the effectiveness of quirements for financial institutions reg- the State’s regulatory system by peri- ulated only by a Federal functional regu- odic oversight review of that system; lator, including banks, savings associa- (ii) That the reports required under tions, and credit unions. the State’s regulatory system be sub- 1020.220 Customer identification programs mitted to the Treasury Department for banks, savings associations, credit within 15 days of receipt by the State; unions, and certain non-Federally regu- lated banks. (iii) That any records required to be maintained by the casinos relevant to Subpart C—Reports Required To Be Made any matter under this chapter and to by Banks which the State has access or main- tains under its regulatory system be 1020.300 General. made available to the Treasury Depart- 1020.310 Reports of transactions in currency. 1020.311 Filing obligations. ment within 30 days of request; 1020.312 Identification required. (iv) That the Treasury Department 1020.313 Aggregation. be provided with periodic status re- 1020.314 Structured transactions. ports on the State’s compliance efforts 1020.315 Transactions of exempt persons. and findings; 1020.320 Reports by banks of suspicious (v) That all but minor violations of transactions. the State requirements be reported to Subpart D—Records Required To Be Treasury within 15 days of discovery; Maintained by Banks and (vi) That the State will initiate com- 1020.400 General. pliance examinations of specific insti- 1020.410 Records to be made and retained by tutions at the request of Treasury banks. within a reasonable time, not to exceed 90 days where appropriate, and will Subpart E—Special Information Sharing provide reports of these examinations Procedures To Deter Money Laun- to Treasury within 15 days of comple- dering and Terrorist Activity tion or periodically during the course 1020.500 General. of the examination upon the request of 1020.520 Special information sharing proce- the Secretary. If for any reason the dures to deter money laundering and ter- State were not able to conduct an in- rorist activity for banks. vestigation within a reasonable time, 1020.530 [Reserved] the State will permit Treasury to con- 1020.540 Voluntary information sharing among financial institutions. duct the investigation. (3) Revocation of any exemption Subpart F—Special Standards of Diligence; under this subsection shall be in the Prohibitions, and Special Measures for sole discretion of the Secretary. Banks § 1010.980 Dollars as including foreign 1020.600 General. currency. 1020.610 Due diligence programs for cor- respondent accounts for foreign financial Wherever in this chapter an amount institutions. is Stated in dollars, it shall be deemed 1020.620 Due diligence programs for private to mean also the equivalent amount in banking accounts. any foreign currency. 1020.630 Prohibition on correspondent ac- counts for foreign shell banks; records concerning owners of foreign banks and PARTS 1011–1019 [Reserved] agents for service of legal process. 1020.640 [Reserved] PART 1020—RULE FOR BANKS 1020.670 Summons or subpoena of foreign bank records; termination of cor- respondent relationship. Subpart A—Definitions AUTHORITY: 12 U.S.C. 1829b and 1951–1959; 31 Sec. U.S.C. 5311–5314 and 5316–5332; title III, sec. 1020.100 Definitions. 314, Pub. L. 107–56, 115 Stat. 307.

640

VerDate Mar<15>2010 15:19 Sep 23, 2011 Jkt 223123 PO 00000 Frm 00650 Fmt 8010 Sfmt 8010 Q:\31\31V3.TXT ofr150 PsN: PC150