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Meeting the AML Challenge: Protecting Our Clients and Our Business in Today’s Environment


AML Regulatory Requirements 

It’s the Law! 

The Bank Secrecy Act as amended by the International Money Laundering and Anti-Terrorism Financial Act of 2001 (Title III of The USA PATRIOT ACT) 

Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism

Failure to comply could result in severe regulatory sanctions, possible criminal penalties and damage to the Company’s reputation


Recent Enforcement Actions and Penalties 

Bank of New York - $38 million for failure to report suspicious activity and conduce adequate due diligence on customers ABN AMRO - $80 million for systemic defects in internal controls and failure to monitor transaction activity AmSouth Bank - $50 million for failure to detect suspicious activity and to file Suspicious Activity Reports in connection with a Ponzi scheme Riggs Bank - $43 million for failure to implement an AML program and to monitor foreign embassy account activity


BSA Compliance

AML Program

Customer Identification Program

Customer Due Diligence (Risk Assessment)

Suspicious activity monitoring and reporting


BSA Compliance - AML Program

The BSA/AML compliance program includes the following elements: 

A system of internal controls to ensure ongoing compliance

Independent testing of BSA/AML compliance

Designated individual responsible for managing BSA compliance Training for appropriate personnel


BSA Compliance - CIP

Customer Identification Program (“CIP”) 

Required Information – Name, Residential Address, Social Security Number, Date of Birth

Verification/Fraud Check

Comparison with Government Lists


BSA Compliance – Customer Due Diligence

Customer Due Diligence 

Risk Assessment

Enhanced Due Diligence for High-Risk Customers


BSA Compliance – Suspicious Activity 

Identification 

Research 

Transaction Monitoring Escalation Procedures

Reporting 

30 day deadline

Confidential


Protecting our clients’ assets…

From fraud: disbursement controls and other internal controls From identity thieves: Protection of personal information Maintaining a culture of compliance – training, continuing education.


Sally Stubbs May 11 06