BSA/AML Examination Manual - ffiec

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• Conduct onsite visits. Non-Bank Financial Institutions — Overview • Review list of agents, including locations, within or outside the United States, that will be receiving services directly or indirectly through the MSB account. • Review written agent management and termination practices for the MSB. • Review written employee screening practices for the MSB. FinCEN and the federal banking agencies do not expect banks to uniformly require any or all of the actions identified above for all MSBs. FFIEC BSA/AML Examination Manual 280 8/24/2007
Non-Bank Financial Institutions — Examination Procedures Examination Procedures Non-Bank Financial Institutions Objective. Assess the adequacy of the bank’s systems to manage the risks associated with accounts of non-bank financial institutions (NBFIs), and management’s ability to implement effective monitoring and reporting systems. 1. Determine the extent of the bank’s relationships with NBFIs and, for banks with significant relationships with NBFIs, review the bank’s risk assessment of this activity. 2. Review the policies, procedures, and processes related to NBFI accounts. Evaluate the adequacy of the policies, procedures, and processes given the bank’s NBFI activities and the risks they represent. Assess whether the controls are adequate to reasonably protect the bank from money laundering and terrorist financing. 3. From review of management information systems (MIS) and internal risk rating factors, determine whether the bank effectively identifies and monitors NBFI accounts. 4. Determine whether the bank’s system for monitoring NBFI accounts for suspicious activities, and for reporting of suspicious activities, is adequate given the nature of the bank’s customer relationships. Money Services Businesses 5. Consistent with the interagency guidance released on April 26, 2005, determine whether the bank has policies, procedures, and processes in place for accounts opened or maintained for money services businesses (MSBs) to: Confirm FinCEN registration, if required. Note: registration must be renewed every two years. Confirm state licensing, if applicable. Confirm agent status, if applicable. Conduct a risk assessment to determine the level of risk associated with each account and whether further due diligence is required. 6. Determine whether the bank’s policies, procedures, and processes to assess risks posed by MSB customers effectively identify higher-risk accounts and the amount of further due diligence necessary. FFIEC BSA/AML Examination Manual 281 8/24/2007
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Bank Secrecy Act / Anti-Money Laund
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Table of Contents EXPANDED EXAMINAT
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INTRODUCTION Introduction This Fede
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Background Introduction In 1970, Co
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Introduction institutions, such as
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Introduction proliferation of weapo
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Introduction Although the motivatio
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Scoping and Planning — Overview C
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Scoping and Planning — Overview T
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Scoping and Planning — Examinatio
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Scoping and Planning — Examinatio
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BSA/AML Risk Assessment — Overvie
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Analysis of Specific Risk Categorie
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BSA/AML Risk Assessment — Examina
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BSA/AML Compliance Program — Over
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BSA/AML Compliance Program — Exam
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Developing Conclusions and Finalizi
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Developing Conclusions and Finalizi
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Customer Identification Program —
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Customer Information Required Custo
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Transaction Testing Customer Identi
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Customer Due Diligence — Overview
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Customer Due Diligence — Examinat
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Suspicious Activity Reporting — O
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Law Enforcement Inquiries and Reque
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Timing of a SAR Filing Suspicious A
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Suspicious Activity Reporting — E
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Suspicious Activity Reporting — E
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Currency Transaction Reporting —
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Currency Transaction Reporting —
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Currency Transaction Reporting Exem
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• Operating a pawn brokerage. Cur
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Currency Transaction Reporting Exem
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Information Sharing — Overview In
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Information Sharing — Overview su
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Information Sharing — Overview es
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Copies of section 314(a) requests.
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Purchase and Sale of Monetary Instr
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Funds Transfers Recordkeeping — O
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Funds Transfers Recordkeeping — O
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Responsibilities of Beneficiary’s
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Funds Transfers Recordkeeping — E
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Foreign Correspondent Account Recor
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Private Banking Due Diligence Progr
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Special Measures — Overview minim
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Examination Procedures Special Meas
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Foreign Bank and Financial Accounts
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International Transportation of Cur
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Office of Foreign Assets Control
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Enterprise-Wide BSA/AML Compliance
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Corporate management. Enterprise-Wi
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Foreign Branches and Offices of U.S
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Examination Procedures Parallel Ban
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Correspondent Accounts (Domestic)
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Correspondent Accounts (Foreign)
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Correspondent Accounts (Foreign)
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U.S. Dollar Drafts — Overview U.S
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U.S. Dollar Drafts — Examination
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Payable Through Accounts — Overvi
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Payable Through Accounts — Examin
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Payable Through Accounts — Examin
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Risk Mitigation Pouch Activities
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Pouch Activities — Examination Pr
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Electronic Banking — Overview lin
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Examination Procedures Electronic B
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Funds Transfers — Overview and on
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Funds Transfers — Overview busine
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Examination Procedures Funds Transf
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Automated Clearing House Transactio
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Transaction Testing Automated Clear
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Electronic Cash — Overview Using
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Third-Party Payment Processors —
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Third-Party Payment Processors —
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Brokered Deposits — Overview Brok
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Examination Procedures Brokered Dep
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Privately Owned Automated Teller Ma
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• Expected account activity, incl
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Privately Owned ATMs — Examinatio
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Nondeposit Investment Products —
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Nondeposit Investment Products —
Page 233 and 234: − Holdings in excess of the custo
Page 235 and 236: Insurance — Overview its insuranc
Page 237 and 238: Examination Procedures Insurance In
Page 239 and 240: Concentration Accounts — Overview
Page 241 and 242: Concentration Accounts — Examinat
Page 243 and 244: Lending Activities — Overview bus
Page 245 and 246: Trade Finance Activities — Overvi
Page 247 and 248: Risk Mitigation Trade Finance Activ
Page 249 and 250: Trade Finance Activities — Overvi
Page 251 and 252: Private Banking — Overview Privat
Page 253 and 254: Customer Risk Assessment Private Ba
Page 255 and 256: Private Banking — Overview determ
Page 257 and 258: Offshore entities. Cash-intensive b
Page 259 and 260: Trust and Asset Management Services
Page 261 and 262: • The type of trust or agency acc
Page 263 and 264: Transaction Testing Trust and Asset
Page 265 and 266: Nonresident Aliens and Foreign Indi
Page 267 and 268: Nonresident Aliens and Foreign Indi
Page 269 and 270: Politically Exposed Persons — Ove
Page 271 and 272: Politically Exposed Persons — Ove
Page 273 and 274: Politically Exposed Persons — Exa
Page 275 and 276: Embassy and Foreign Consulate Accou
Page 277 and 278: Embassy and Foreign Consulate Accou
Page 279 and 280: Non-Bank Financial Institutions —
Page 281 and 282: Non-Bank Financial Institutions —
Page 283: Non-Bank Financial Institutions —
Page 287 and 288: Professional Service Providers —
Page 289 and 290: Professional Service Providers —
Page 291 and 292: Non-Governmental Organizations and
Page 293 and 294: Non-Governmental Organizations and
Page 295 and 296: Business Entities (Domestic and For
Page 297 and 298: Risk Factors Business Entities (Dom
Page 303 and 304: Cash-Intensive Businesses — Overv
Page 305 and 306: Appendix A: BSA Laws and Regulation
Page 311 and 312: Appendix B: BSA/AML Directives Appe
Page 313 and 314: Web Sites Appendix C: BSA/AML Refer
Page 315 and 316: Appendix C: BSA/AML References •
Page 317 and 318: Appendix D: Statutory Definition of
Page 319 and 320: Appendix E: International Organizat
Page 321 and 322: Appendix F: Money Laundering and Te
Page 325 and 326: Privately Owned Automated Teller Ma
Page 329 and 330: Funds Transfers Appendix F: Money L
Page 331 and 332: Appendix G: Structuring However, tw
Page 333 and 334: Appendix H: Request Letter Items (C
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Appendix H: Request Letter Items (C
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Expanded Examination Procedures App
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Parallel Banking _ List any paralle
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Appendix I: Risk Assessment Link to
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Appendix J: Quantity of Risk Matrix
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Appendix K: Customer Risk versus Du
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When did the suspicious activity ta
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Low No history of OFAC actions. No
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Appendix O: Examiner Tools for Tran
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Appendix O: Examiner Tools for Tran
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Signature Cards Appendix P: BSA Rec
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Name and address of the beneficiary
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Appendix P: BSA Record Retention Re
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Acronym or abbreviation Full name E
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Acronym or abbreviation Full name N
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Appendix R: Enforcement Guidance Ap
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Appendix R: Enforcement Guidance As
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Appendix R: Enforcement Guidance ex
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Appendix R: Enforcement Guidance FF
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Backfiling. See Currency Transactio
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overview, 165-167 request letter it
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money services businesses, 279 nond
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Export Administration Act of 1979,
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Index 314(a) record searches, 88 Cu
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Index for a BSA/AML compliance prog
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guidance on providing banking servi
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247, 253, H-15 Offshore Financial C
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trade finance activities, H-14 trus
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enterprise-wide, 149-150, 152, 153
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U United Nations, 7, 137 Updating O
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