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The Anti-Money Laundering Association is proud to announce a partnership with TAMLO International Inc. We are extremely excited about working with TAMLO as they bring a fresh new training perspective to the industry. TAMLO is a designer of highly engaging and fully interactive online training for anti-money laundering (AML) and counter-terrorist financing (CTF) compliance. They have an award-winning creative team that uses video, animation and real-life examples to teach employees about their roles and responsibilities. The course content is reviewed and tested by AML experts.
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Director, Sales and Customer Service
Phone: 1-888-998-2650 Ext 104
FinCEN Clarifies Money Services Businesses Definitions Rule Includes Foreign-Located MSBs Doing Business in U.S.
VIENNA, Va. - The Financial Crimes Enforcement Network (FinCEN) today released a final rule, Definitions and Other Regulations Relating to Money Services Businesses, that more clearly defines which businesses qualify as Money Services Businesses (MSBs) and are therefore subject to anti-money laundering rules under the Bank Secrecy Act (BSA).
"This rule will enable entities to determine in a more predictable and straightforward way whether they are operating as money service businesses subject to BSA rules," said FinCEN Director James H. Freis, Jr. "In addition, the rule requires foreign entities conducting these activities in the United States as MSBs to register. This addresses the global nature of financial crimes."
One key element of the definition of an MSB (other than a money transmitter) under the existing regulation that if the MSB conducts $1,000 worth of transactions per person per day, the enterprise must comply with anti-money laundering rules required under the BSA. The rule issued today maintains this threshold for all categories of MSBs other than money transmitters. An entity that engages in money transmission in any amount is subject to the BSA rules. The rule also ensures that certain foreign-located persons engaging in MSB activities within the United States are subject to the BSA rules.
The final rule also clarifies several provisions, among them:
Importantly, whether a person is subject to regulation as an MSB does not depend on factors such as whether the person is licensed as a business, has employees, or is engaged in a for-profit venture. This rule clarifies that it is the activities performed that cause a person to be categorized as an MSB subject to anti-money laundering rules.
In addition, an entity qualifies as an MSB based on its activity within the United States, not the physical presence of one or more of its agents, agencies, branches, or offices in the United States. This requirement arose out of the recognition that the Internet and other technological advances make it increasingly possible for persons to offer MSB services in the United States from foreign locations. FinCEN seeks to ensure that the BSA rules apply to all persons engaging in covered activities within the United States, regardless of their physical location.
FinCEN also today announced that the current version of the Registration of Money Services Business form (RMSB or FinCEN Form 107) is now available for electronic filing. The form is being updated to reflect changes made necessary by this final rule.
This rule will be effective 60 days from publication in the Federal Register. The compliance with the registration requirement will not be required until 6 months from publication in the Federal Register to allow time for the form to be updated.
Regulatory Compliance Update
June & July 2011
Fincen: What's New http://www.fincen.gov/whatsnew.html
Enforcement Actions: BSA/AML
FinCEN: None Listed for June and July 2011
Recent OFAC Actions (Visit OFAC Link) Moved to the AMLA OFAC Forum section.
OFAC Recent Actions
07/29/2011 Somalia Designations
07/28/2011 Anti-terrorism Designations
07/25/2011 Cuba Travel Advisory
07/25/2011 Transnational Criminal Organizations Executive Order
07/15/2011 Routine update of list of Travel and Carrier Service Providers and Remittance Forwarders
07/11/2011 Routine update of list of Travel and Carrier Service Providers and Remittance Forwarders
07/01/2011 New Libyan Sanctions Regulations, 31 CFR part 570
06/30/2011 Alphabetical Listings: Specially Designated Nationals and Blocked Persons; Blocked Vessels; Persons Determined to be the Government of Iran
06/30/2011 Amendment of Western Balkans Stabilization Regulations and Removal of Former Yugoslavia Regulations
06/29/2011 Release of OFAC Civil Penalties Information
06/29/2011 Syria Designations; Iran Human Rights Designations
06/24/2011 General License No. 4, under the Weapons of Mass Destruction Proliferators Sanctions Regulations
06/23/2011 Anti-terrorism Designations; Non-proliferation Designations; Iran Revolutionary Guard Corps Related Designations
06/21/2011 Anti-terrorism Designations; Libya Identifications; Libya Designation Removals; Zimbabwe Designation Removals; Libya General License
06/20/2011 OFAC Guidance on the Donations of Food and Medicine to Iran and the Non-Specified Areas of Sudan
06/20/2011 North Korea Regulatory Update: Amendment of North Korea Sanctions Regulations; Removal of Foreign Assets Control Regulations and Regulations Prohibiting Transactions Involving the Shipment of Certain Merchandise between Foreign Countries (Transaction Control Regulations)
06/20/2011 Non-proliferation Designations
06/16/2011 Anti-terrorism Designations
06/10/2011 Release of updated list of authorized providers of air, travel, and remittance forwarding services to Cuba
06/09/2011 Iran Human Rights Designations; Iran Revolutionary Guard Corps Designations; Non-proliferation Designations
06/03/2011 Release of quarterly TSRA report
06/01/2011 Kingpin Act Designations
June 2011 ENTITIES – 31 CFR 501.805(d)(1)(i) Gen Re Settles Iranian Transactions Regulations Allegations:General Reinsurance Corporation ("Gen Re"), a Delaware corporation with principal offices located in Stamford, Connecticut, has remitted $59,130 to settle liability for apparent violations of the Iranian Transactions Regulations, 31 C.F.R. part 560, that occurred in July and August 2005. The apparent violations consist of two reinsurance claim payments to the Steamship Mutual Underwriting Association Limited ("Steamship Mutual") for losses arising from vessel operations of the National Iranian Tanker Company. Gen Re made the excess of loss claim payments pursuant to its facultative reinsurance obligation to Steamship Mutual for the coverage period June 16, 1998, to February 20, 2002. The combined amount of the two reinsurance claim payments was $309,740.65. The base penalty for the apparent violations was $131,424. Gen Re voluntarily disclosed this matter to OFAC and the transactions do not constitute an egregious case. The settlement amount reflects OFAC’s consideration of the following: Gen Re is the largest U.S. reinsurer and one of the largest reinsurers in the world; the apparent violations resulted from activities of certain claims personnel, including a Vice President for Claims, that were contrary to Gen Re sanctions compliance policies and procedures; Gen Re subsequently installed enhanced sanctions compliance software and implemented training programs for personnel who have a high probability of encountering sanctioned transactions; Gen Re substantially cooperated with OFAC by signing a tolling agreement and promptly responding to all requests for information; and Gen Re has not previously been the subject of OFAC penalties or other OFAC administrative actions.
Gen Re Settles Iranian Transactions Regulations Allegations:
General Reinsurance Corporation ("Gen Re"), a Delaware corporation with principal offices located in Stamford, Connecticut, has remitted $59,130 to settle liability for apparent violations of the Iranian Transactions Regulations, 31 C.F.R. part 560, that occurred in July and August 2005. The apparent violations consist of two reinsurance claim payments to the Steamship Mutual Underwriting Association Limited ("Steamship Mutual") for losses arising from vessel operations of the National Iranian Tanker Company. Gen Re made the excess of loss claim payments pursuant to its facultative reinsurance obligation to Steamship Mutual for the coverage period June 16, 1998, to February 20, 2002. The combined amount of the two reinsurance claim payments was $309,740.65. The base penalty for the apparent violations was $131,424. Gen Re voluntarily disclosed this matter to OFAC and the transactions do not constitute an egregious case. The settlement amount reflects OFAC’s consideration of the following: Gen Re is the largest U.S. reinsurer and one of the largest reinsurers in the world; the apparent violations resulted from activities of certain claims personnel, including a Vice President for Claims, that were contrary to Gen Re sanctions compliance policies and procedures; Gen Re subsequently installed enhanced sanctions compliance software and implemented training programs for personnel who have a high probability of encountering sanctioned transactions; Gen Re substantially cooperated with OFAC by signing a tolling agreement and promptly responding to all requests for information; and Gen Re has not previously been the subject of OFAC penalties or other OFAC administrative actions.
FinCEN Withdraws Section 311 Actions Against Latvia's VEF Banka
The Financial Crimes Enforcement Network (FinCEN) has submitted a document to the Federal Register that withdraws its April 2005 finding under Section 311 of the USA PATRIOT ACT, which determined VEF Banka to be a financial institution of primary money laundering concern. FinCEN is also withdrawing the final rule against VEF Banka that imposed a special measure that prohibited U.S. financial institutions from—directly or indirectly—opening or maintaining correspondent accounts in the U.S. for VEF Banka.
At the time of the final rule issuance in July 2006, FinCEN had then determined that VEF, one of the smallest of Latvia’s 23 banks, was a banking resource for illicit shell companies in financial fraud rings. VEF had permitted ATM withdrawals in significant amounts, which is an essential component of the execution of large financial fraud schemes.
Since that time, there have been significant steps taken by Latvian authorities to liquidate the bank that have led FinCEN to determine that VEF no longer poses a significant money laundering threat to the United States. In May 2010, VEF Banka’s operating license was revoked by the Latvian banking regulator. The revocation of VEF Banka’s license was later confirmed by the Senate of Latvia’s Supreme Court, resulting in the termination of the bank’s ability to operate as a financial institution under Latvian law. In November 2010, the Riga District Court issued a non-appealable order to begin liquidating the bank. The liquidation process is expected to be complete in one to two years and will result in the disposition of all of VEF Banka’s assets, including its subsidiary, Veiksmes lizings.
The U.S. Department of State’s most recent International Narcotics Control Strategy Report describes Latvia as a growing regional financial center that has a large number of commercial banks with a sizeable nonresident deposit base. Sources of laundered money in Latvia primarily involve tax evasion, but also include counterfeiting, corruption, and other illicit activity. Since 2008, Latvia has made important strides in strengthening its anti-money laundering/counter-financing of terrorism (AML/CFT) regime, including passing legislation and adopting regulations to significantly tighten controls, establishing an national AML/CFT coordination body chaired by the Prime Minister, and increasing penalties on money laundering activity.
The withdrawal of these actions will be effective upon publication in the Federal Register.
FinCEN Issues Prepaid Access Final Rule Balancing the Needs of Law Enforcement and Industry
VIENNA, Va. – The Financial Crimes Enforcement Network (FinCEN) today issued its final rule that amends Bank Secrecy Act Regulations – Definitions and Other Regulations Relating to Prepaid Access, amending the money services businesses (MSB) rules and establishing a more comprehensive regulatory approach for prepaid access.
The rule puts in place suspicious activity reporting, and customer and transactional information collection requirements on providers and sellers of certain types of prepaid access similar to other categories of MSBs.
The final rule:
A “Provider” of “Prepaid Access” for a prepaid access program can be designated by agreement among the participants in the program or will be determined by their degree of its oversight and control over the program – including organizing, offering, and administering the program. Providers are required to register with FinCEN.
Sellers are retailers of prepaid access devices. While sellers are not required to register with FinCEN (just as no MSB that operates solely as an agent for another MSB is required to register), they must maintain an anti-money laundering program if the prepaid access product offered is covered by the rule and can be used without a later activation process that includes customer identification; or if a retailer sells prepaid access products (regardless of whether offered under a prepaid program) providing a portal to funds that exceed $10,000 to any person during any one day.
The prepaid access final rule is mandated under the Credit Card Accountability, Responsibility and Disclosure Act of 2009. “Prepaid Access” under the final rule covers prepaid devices such as plastic cards, mobile phones, electronic serial numbers, key fobs and/or other mechanisms that provide a portal to funds that have been paid for in advance and are retrievable and transferable.
This rule will be effective 60 days from publication in the Federal Register. The compliance with the registration requirement will not be required until six months from publication in the Federal Register to allow time for the registration form to be updated.
VIENNA, Va. – The Financial Crimes Enforcement Network (FinCEN) today issued its final rule that amends Bank Secrecy Act Regulations – Definitions and Other Regulations Relating to Prepaid Access, amending the money services businesses (MSB) rules and establishing a more comprehensive regulatory approach for prepaid access. The rule puts in place suspicious activity reporting, and customer and transactional information collection requirements on providers and sellers of certain types of prepaid access similar to other categories of MSBs.
“The final rule addresses regulatory gaps that have resulted from the proliferation of prepaid access innovations over the last 12 years and their increasing use as an accepted payment method,” said FinCEN Director James H. Freis, Jr. “FinCEN prepaid access regulations also provide a balance to empower law enforcement with the information needed to attack money laundering, terrorist financing, and other illicit transactions through the financial system while preserving innovation and the many legitimate uses and societal benefits offered by prepaid access.”
To date, the 314(a) process already has proved to be successful, as illustrated below. Results have yielded productive leads for both terrorist financing and money laundering investigations. The immediate matches have, for example, led to the identification of new accounts, transactions, indictments, etc. and enabled law enforcement to efficiently direct its use of legal processes to promptly obtain critical evidence in numerous cases. Examples of 314(a) requests, based on money laundering, include:
Hawala operation involving a sanctioned country
Alien smuggling resulting in fatalities
Nationwide investment fraud with many victims
International criminal network involved in identity theft and wire fraud
Multi-agency investigation of drug trafficking rings
Click on link to read entire stats
FinCEN E-Filing Informational Webinar Announced
The Financial Crimes Enforcement Network (FinCEN) is announcing that it will hold an informational Webinar on Wednesday, August 10, 2011, at 2:00 p.m. Eastern Time that will highlight to money services businesses (MSBs) the benefits of the Bank Secrecy Act Electronic Filing System (BSA E-Filing) and instruct MSBs on the simple process of signing up and using E-Filing.
On July 18, 2011, FinCEN announced that MSBs can now use the BSA E-Filing System to electronically submit initial registrations, renewals, corrections, and re-registrations electronically. MSBs can also electronically submit currency transaction reports and suspicious activity reports. Because E-Filing reduces the processing times, MSBs that file electronically will receive acknowledgement letters more quickly than do those that file on paper. .
Electronically filing BSA information increases the timeliness of BSA data availability, reduces the cost of paper processing, streamlines BSA report submissions, improves both data quality and data security, and provides users with enhanced audit and recordkeeping capabilities. The BSA E-Filing system is a free, Web-based system that is user-ID and password protected. Financial institutions may use the system to electronically file a variety of BSA forms through a FinCEN secure network. More importantly, when an institution submits a form through the E-Filing system, it is more quickly available to, and searchable by, law enforcement.
During this Webinar, FinCEN representatives will discuss the following topics:
FinCEN strongly encourages MSBs that are still filing any paper forms to register for this Webinar. FinCEN's recent enhancements to BSA E-Filing support the U.S. Department of the Treasury's initiative of moving toward a paperless Agency, referred to in the Department's Open Government Plan. FinCEN is committed to making efficient use of technology, such as webinars, to better inform financial professionals and the public about its activities designed to better protect the financial system from criminal abuse.
BSA E-Filing 101 Webinar Date: Wednesday, August 10, 2011 Time: 2:00 p.m. ET After registering you will receive a confirmation email containing information about joining the Webinar. PC-based attendees will require: Windows® 7, Vista, XP, 2003 Server or 2000 Macintosh®-based attendees will require: Mac OS® X 10.4.11 (Tiger® or newer Space is limited, so sign up now at https://www2.gotomeeting.com/register/612718611
DON’T miss this event --- Friday, August 12, in Orlando.
We will not teach you the regulatory requirements; we will not explain how many days you have to file a SAR, what records you need to keep, or what your BSA program should include.
We WILL teach you what the bad guys are doing to hide from you and from law enforcement, to help PINPOINT YOUR RESOURCES for a more successful AML program.
The cost is only $125 per person for the full-day. Easy registration and payment at http://www.saltmarshcpa.com/seminars/nForm.asp.
SPECIFIC DETAILS: 8 CPE credit hours from our co-sponsors, The Anti-Money Laundering Association (www.theamla.com) or the Association of Certified Fraud Examiners (the www.acfe.com).
Fairwinds Credit Union
3087 N. Alafaya TrailOrlando, FL 32820
Session is 8:00 a.m. to 5:30 p.m. -- Doors Open at 7:45 a.m. for registration and seating. Refreshments will be served, but lunch is “on your own”.
On June 29, 2011, the White House released the National Strategy for Counterterrorism as part of the President’s National Security Strategy. The principal focus of the counterterrorism strategy is on the network that poses the most direct and significant threat to the United States—al-Qa’ida, its affiliates, and its adherents. One of the specific goals of the strategy most closely tied to the counter-terrorist financing component of FinCEN’s mission is the U.S. Government’s efforts to deprive al-Qa’ida and its affiliates of their enabling means, including illicit financing.
August 22, 2011
Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network,and the State of Florida Office of Financial Regulation Assess Civil Money PenaltiesAgainst Ocean Bank AFederal Deposit Insurance Corporation, the Financial Crimes Enforcement Network,and the State of Florida Office of Financial Regulation Assess Civil Money PenaltiesAgainst Ocean Bank
WASHINGTON, DC - The Federal Deposit Insurance Corporation (FDIC), the Treasury's Financial Crimes Enforcement Network (FinCEN), and the State of Florida Office of Financial Regulation (OFR) today announced the assessment of concurrent civil money penalties of $10.9 million against Ocean Bank, Miami, Florida, for violations of federal and state Bank Secrecy Act (BSA) and anti-money (AML) laundering laws and regulations. Ocean Bank, without admitting or denying the allegations, consented to payment of the civil money penalties, which was satisfied by a single payment to the U.S. Government.
In taking these actions, the FDIC, FinCEN, and OFR determined that the bank failed to implement an effective BSA/AML Compliance Program with internal controls reasonably designed to detect and report money laundering and other suspicious activity in a timely manner. The bank failed to conduct adequate independent testing, particularly with respect to suspicious activity reporting requirements. In addition, the bank failed to sufficiently staff the BSA compliance function with appropriately trained staff to ensure compliance with BSA requirements.
"Effective Bank Secrecy Act/anti-money laundering programs commensurate with the risk profile of the institution is paramount in protecting our financial system and individual banks from harm," said Sandra L. Thompson, Director, Division of Risk Management Supervision. "This penalty underscores the significance for banks to have strong internal systems and controls to detect and report suspicious activity and ensure compliance with Bank Secrecy Act requirements."
"The Bank failed to recognize and mitigate risks and report transaction activity often associated with money laundering involving direct foreign account relationships in high-risk jurisdictions, particularly Venezuela," noted FinCEN Director James H. Freis, Jr. "The Bank's failure to respond to such risk with commensurate systems and controls was both systemic and longstanding. The civil money penalties and forfeiture concludes joint investigations by FinCEN, the Drug Enforcement Administration, Internal Revenue Service-Criminal Investigation and the United States Attorney's Office for the Southern District of Florida, and parallel examinations conducted by the Federal Deposit Insurance Corporation and the Florida Office of Financial Regulation."
"The OFR will continue to monitor Ocean Bank's efforts to enhance its BSA/AML program," said Tom Cardwell, Commissioner of the Florida Office of Financial Regulation. "We are confident the bank is committed to be in full compliance with the letter and spirit of the Consent Order and Agreement."
Federal Deposit Insurance Corporation [Order to Pay Civil Money Penalty]
Financial Crimes Enforcement Network [Assessment of Civil Money Penalty]
State of Florida Office of Financial Regulation [Order to Pay Civil Money Penalty]
IMPORTANT NOTICE FOR MSBs
August 24, 2011
REMINDER - In a letter dated April 27, 2011, the Financial Crimes Enforcement Network (FinCEN) requested the list of agents from money services businesses (MSBs), who reported, in Part IV, Item 29 of the registration form that they have one or more agents authorized to conduct business on their behalf. The letters were sent to the Owner or Controlling Person, as reported to FinCEN, on its most current Form 107, Registration of Money Services Business (RMSB). Pursuant to our authority contained in 31 CFR § 1022.380(d), MSBs were required to send their agent list to FinCEN, by June 20, 2011. If an MSB reported it has agents on its RMSB and has not provided a list of its agents to FinCEN, please provide your list using the following template http://www.fincen.gov/financial_institutions/msb/agentrequest.html and email it to firstname.lastname@example.org.
If an MSB inaccurately filed its most current RMSB and does not have agents, we request that you respond, via email to email@example.com noting that you do not have agents. You must also file a corrected RMSB. FinCEN recently announced that MSBs can now file RMSBs electronically. Accordingly, as the response due date for this request has passed, MSBs are strongly encouraged to file their corrected RMSBs electronically. The electronic RMSB can be used to file not only initial registrations, but also renewals, re-registrations, and corrections.
To file a correction, you will need the Document Control Number (DCN) that is noted in your original registration acknowledgement letter. DCNs can also be obtained by calling the IRS's Enterprise Computing Center at 866-270-0733. To file a corrected RMSB, access the BSA E-Filing System's website, at http://bsaefiling.fincen.treas.gov, complete the RMSB form in its entirety, paying particular attention to Part I of the form, by checking box "c" and either a, b, or d, as appropriate. Complete Part IV item 29 by recording a zero in each box where you previously reported agents. E-Filers will receive electronic notification of the transmission and receipt of the submission.
MSBs required to register with FinCEN must maintain a list of agents, and make the list of agents available to FinCEN, upon request. See 31 U.S.C. § 5330(c) and 31 CFR § 1022.380(d). Failure to comply with agent list obligations is a violation of money services businesses registration requirements of the Bank Secrecy Act (BSA) and its implementing regulations. See 31 U.S.C. § 5330(e) and 31 CFR § 1022.380(e). As administrator of the BSA, FinCEN may impose civil money penalties for failure to comply with BSA registration requirements, in an amount up to $5,000 per violation. Each day a violation continues constitutes a separate violation. See 31 U.S.C. § 5330(e) and 31 CFR § 1022.380(e).
If you have already responded to the above request, we appreciate your attention to this matter and there is no follow-up action necessary.