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31 USC CHAPTER 53 - MONETARY TRANSACTIONS 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
.
-HEAD-
CHAPTER 53 - MONETARY TRANSACTIONS
-MISC1-
SUBCHAPTER I - CREDIT AND MONETARY EXPANSION
Sec.
5301. Buying obligations of the United States Government.
5302. Stabilizing exchange rates and arrangements.
5303. Reserved coins and currencies of foreign countries.
5304. Regulations.
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
5311. Declaration of purpose.
5312. Definitions and application.
5313. Reports on domestic coins and currency transactions.
5314. Records and reports on foreign financial agency transactions.
5315. Reports on foreign currency transactions.
5316. Reports on exporting and importing monetary instruments.
5317. Search and forfeiture of monetary instruments.
5318. Compliance, exemptions, and summons authority.
5318A. Special measures for jurisdictions, financial institutions,
or international transactions of primary money laundering
concern.
5319. Availability of reports.
5320. Injunctions.
5321. Civil penalties.
5322. Criminal penalties.
5323. Rewards for informants.
5324. Structuring transactions to evade reporting requirement
prohibited.
5325. Identification required to purchase certain monetary
instruments.
5326. Records of certain domestic coin and currency transactions.
(5327. Repealed.)
5328. Whistleblower protections.
5329. Staff commentaries.
5330. Registration of money transmitting businesses.
5331. Reports relating to coins and currency received in
nonfinancial trade or business.
5332. Bulk cash smuggling into or out of the United States.
SUBCHAPTER III - MONEY LAUNDERING AND RELATED FINANCIAL CRIMES
5340. Definitions.
PART 1 - NATIONAL MONEY LAUNDERING AND RELATED FINANCIAL CRIMES
STRATEGY
5341. National money laundering and related financial crimes
strategy.
5342. High-risk money laundering and related financial crime areas.
PART 2 - FINANCIAL CRIME-FREE COMMUNITIES SUPPORT PROGRAM
5351. Establishment of financial crime-free communities support
program.
5352. Program authorization.
5353. Information collection and dissemination with respect to
grant recipients.
5354. Grants for fighting money laundering and related financial
crimes.
5355. Authorization of appropriations.
AMENDMENTS
2001 - Pub. L. 107-56, title III, Sec. 365(c), Oct. 26, 2001, 115
Stat. 335, which directed the amendment of chapter 53 analysis by
inserting item 5331 after the item relating to section 5332 (as
added by section 112 of this title), was executed by inserting item
5331 after item 5330 to reflect the probable intent of Congress.
Pub. L. 107-56, title III, Sec. 311(b), 371(c), Oct. 26, 2001,
115 Stat. 304, 338, added items 5318A and 5332.
1998 - Pub. L. 105-310, Sec. 2(b), Oct. 30, 1998, 112 Stat. 2948,
added subchapter III heading, parts 1 and 2 headings, and items
5340 to 5355.
1996 - Pub. L. 104-208, div. A, title II, Sec. 2223(2), Sept.
30, 1996, 110 Stat. 3009-415, struck out item 5327 ''Identification
of financial institutions''.
1994 - Pub. L. 103-325, title III, Sec. 311(b), title IV, Sec.
408(d), Sept. 23, 1994, 108 Stat. 2221, 2252, added items 5329 and
5330.
1992 - Pub. L. 102-550, title XV, Sec. 1511(c), 1563(b), Oct. 28,
1992, 106 Stat. 4057, 4073, added items 5327 and 5328.
1988 - Pub. L. 100-690, title VI, Sec. 6185(f), Nov. 18, 1988,
102 Stat. 4357, added items 5325 and 5326.
1986 - Pub. L. 99-570, title I, Sec. 1354(b), 1356(d), Oct. 27,
1986, 100 Stat. 3207-22, 3207-25, substituted ''Compliance,
exemptions, and summons authority'' for ''Compliance and
exemptions'' in item 5318 and added item 5324.
1984 - Pub. L. 98-473, title II, Sec. 901(f), Oct. 12, 1984, 98
Stat. 2136, added item 5323.
-SECREF-
CHAPTER REFERRED TO IN OTHER SECTIONS
This chapter is referred to in section 9703 of this title; title
18 section 1510; title 19 sections 1431, 1613b.
-CITE-
31 USC SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY
INSTRUMENTS TRANSACTIONS 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
.
-HEAD-
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-SECREF-
SUBCHAPTER REFERRED TO IN OTHER SECTIONS
This subchapter is referred to in section 310 of this title;
title 12 sections 1464, 1786, 1817, 1818, 1829b, 3401, 3413; title
15 sections 78q, 6802; title 18 sections 1952, 1956, 1961; title 22
section 2714.
-CITE-
31 USC Sec. 5311 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5311. Declaration of purpose
-STATUTE-
It is the purpose of this subchapter (except section 5315) to
require certain reports or records where they have a high degree of
usefulness in criminal, tax, or regulatory investigations or
proceedings, or in the conduct of intelligence or
counterintelligence activities, including analysis, to protect
against international terrorism.
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 995; Pub. L. 107-56,
title III, Sec. 358(a), Oct. 26, 2001, 115 Stat. 326.)
-MISC1-
Historical and Revision Notes
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Revised Section Source (U.S. Code) Source (Statutes at
Large)
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5311 31:1051. Oct. 26, 1970, Pub.
L. 91-508, Sec.
202, 84 Stat. 1118.
-------------------------------
AMENDMENTS
2001 - Pub. L. 107-56 inserted '', or in the conduct of
intelligence or counterintelligence activities, including analysis,
to protect against international terrorism'' before period at end.
EFFECTIVE AND TERMINATION DATES OF 2001 AMENDMENT
Amendments by title III of Pub. L. 107-56 to terminate effective
on and after the first day of fiscal year 2005 if Congress enacts a
joint resolution that such amendments no longer have the force of
law, see section 303 of Pub. L. 107-56, set out as a Four-Year
Congressional Review; Expedited Consideration note under this
section.
Amendment by Pub. L. 107-56 applicable with respect to reports
filed or records maintained on, before, or after Oct. 26, 2001, see
section 358(h) of Pub. L. 107-56, set out as a note under section
1829b of Title 12, Banks and Banking.
SHORT TITLE
This subchapter and chapter 21 (Sec. 1951 et seq.) of Title 12,
Banks and Banking, are each popularly known as the ''Bank Secrecy
Act''. See Short Title note set out under section 1951 of Title 12.
INTERNATIONAL MONEY LAUNDERING ABATEMENT AND FINANCIAL
ANTI-TERRORISM ACT OF 2001; FINDINGS AND PURPOSES
Pub. L. 107-56, title III, Sec. 302, Oct. 26, 2001, 115 Stat.
296, provided that:
''(a) Findings. - The Congress finds that -
''(1) money laundering, estimated by the International Monetary
Fund to amount to between 2 and 5 percent of global gross
domestic product, which is at least $600,000,000,000 annually,
provides the financial fuel that permits transnational criminal
enterprises to conduct and expand their operations to the
detriment of the safety and security of American citizens;
''(2) money laundering, and the defects in financial
transparency on which money launderers rely, are critical to the
financing of global terrorism and the provision of funds for
terrorist attacks;
''(3) money launderers subvert legitimate financial mechanisms
and banking relationships by using them as protective covering
for the movement of criminal proceeds and the financing of crime
and terrorism, and, by so doing, can threaten the safety of
United States citizens and undermine the integrity of United
States financial institutions and of the global financial and
trading systems upon which prosperity and growth depend;
''(4) certain jurisdictions outside of the United States that
offer 'offshore' banking and related facilities designed to
provide anonymity, coupled with weak financial supervisory and
enforcement regimes, provide essential tools to disguise
ownership and movement of criminal funds, derived from, or used
to commit, offenses ranging from narcotics trafficking,
terrorism, arms smuggling, and trafficking in human beings, to
financial frauds that prey on law-abiding citizens;
''(5) transactions involving such offshore jurisdictions make
it difficult for law enforcement officials and regulators to
follow the trail of money earned by criminals, organized
international criminal enterprises, and global terrorist
organizations;
''(6) correspondent banking facilities are one of the banking
mechanisms susceptible in some circumstances to manipulation by
foreign banks to permit the laundering of funds by hiding the
identity of real parties in interest to financial transactions;
''(7) private banking services can be susceptible to
manipulation by money launderers, for example corrupt foreign
government officials, particularly if those services include the
creation of offshore accounts and facilities for large personal
funds transfers to channel funds into accounts around the globe;
''(8) United States anti-money laundering efforts are impeded
by outmoded and inadequate statutory provisions that make
investigations, prosecutions, and forfeitures more difficult,
particularly in cases in which money laundering involves foreign
persons, foreign banks, or foreign countries;
''(9) the ability to mount effective counter-measures to
international money launderers requires national, as well as
bilateral and multilateral action, using tools specially designed
for that effort; and
''(10) the Basle Committee on Banking Regulation and
Supervisory Practices and the Financial Action Task Force on
Money Laundering, of both of which the United States is a member,
have each adopted international anti-money laundering principles
and recommendations.
''(b) Purposes. - The purposes of this title (see Short Title of
2001 Amendment note set out under section 5301 of this title) are -
''(1) to increase the strength of United States measures to
prevent, detect, and prosecute international money laundering and
the financing of terrorism;
''(2) to ensure that -
''(A) banking transactions and financial relationships and
the conduct of such transactions and relationships, do not
contravene the purposes of subchapter II of chapter 53 of title
31, United States Code, section 21 of the Federal Deposit
Insurance Act (12 U.S.C. 1829b), or chapter 2 of title I of
Public Law 91-508 (84 Stat. 1116) (12 U.S.C. 1951 et seq.), or
facilitate the evasion of any such provision; and
''(B) the purposes of such provisions of law continue to be
fulfilled, and such provisions of law are effectively and
efficiently administered;
''(3) to strengthen the provisions put into place by the Money
Laundering Control Act of 1986 (18 U.S.C. 981 note) (see Short
Title of 1986 Amendment note set out under section 981 of Title
18, Crimes and Criminal Procedure), especially with respect to
crimes by non-United States nationals and foreign financial
institutions;
''(4) to provide a clear national mandate for subjecting to
special scrutiny those foreign jurisdictions, financial
institutions operating outside of the United States, and classes
of international transactions or types of accounts that pose
particular, identifiable opportunities for criminal abuse;
''(5) to provide the Secretary of the Treasury (in this title
referred to as the 'Secretary') with broad discretion, subject to
the safeguards provided by the Administrative Procedure Act under
title 5, United States Code (5 U.S.C. 551 et seq., 701 et seq.),
to take measures tailored to the particular money laundering
problems presented by specific foreign jurisdictions, financial
institutions operating outside of the United States, and classes
of international transactions or types of accounts;
''(6) to ensure that the employment of such measures by the
Secretary permits appropriate opportunity for comment by affected
financial institutions;
''(7) to provide guidance to domestic financial institutions on
particular foreign jurisdictions, financial institutions
operating outside of the United States, and classes of
international transactions that are of primary money laundering
concern to the United States Government;
''(8) to ensure that the forfeiture of any assets in connection
with the anti-terrorist efforts of the United States permits for
adequate challenge consistent with providing due process rights;
''(9) to clarify the terms of the safe harbor from civil
liability for filing suspicious activity reports;
''(10) to strengthen the authority of the Secretary to issue
and administer geographic targeting orders, and to clarify that
violations of such orders or any other requirement imposed under
the authority contained in chapter 2 of title I of Public Law
91-508 (12 U.S.C. 1951 et seq.) and subchapters II and III of
chapter 53 of title 31, United States Code, may result in
criminal and civil penalties;
''(11) to ensure that all appropriate elements of the financial
services industry are subject to appropriate requirements to
report potential money laundering transactions to proper
authorities, and that jurisdictional disputes do not hinder
examination of compliance by financial institutions with relevant
reporting requirements;
''(12) to strengthen the ability of financial institutions to
maintain the integrity of their employee population; and
''(13) to strengthen measures to prevent the use of the United
States financial system for personal gain by corrupt foreign
officials and to facilitate the repatriation of any stolen assets
to the citizens of countries to whom such assets belong.''
FOUR-YEAR CONGRESSIONAL REVIEW; EXPEDITED CONSIDERATION
Pub. L. 107-56, title III, Sec. 303, Oct. 26, 2001, 115 Stat.
298, provided that:
''(a) In General. - Effective on and after the first day of
fiscal year 2005, the provisions of this title (see Short Title of
2001 Amendment note set out under section 5301 of this title) and
the amendments made by this title shall terminate if the Congress
enacts a joint resolution, the text after the resolving clause of
which is as follows: 'That provisions of the International Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001, and
the amendments made thereby, shall no longer have the force of
law.'
''(b) Expedited Consideration. - Any joint resolution submitted
pursuant to this section should be considered by the Congress
expeditiously. In particular, it shall be considered in the Senate
in accordance with the provisions of section 601(b) of the
International Security Assistance and Arms Control Act of 1976
(Pub. L. 94-329, 90 Stat. 765).''
COOPERATIVE EFFORTS TO DETER MONEY LAUNDERING
Pub. L. 107-56, title III, Sec. 314, Oct. 26, 2001, 115 Stat.
307, provided that:
''(a) Cooperation Among Financial Institutions, Regulatory
Authorities, and Law Enforcement Authorities. -
''(1) Regulations. - The Secretary (of the Treasury) shall,
within 120 days after the date of enactment of this Act (Oct. 26,
2001), adopt regulations to encourage further cooperation among
financial institutions, their regulatory authorities, and law
enforcement authorities, with the specific purpose of encouraging
regulatory authorities and law enforcement authorities to share
with financial institutions information regarding individuals,
entities, and organizations engaged in or reasonably suspected
based on credible evidence of engaging in terrorist acts or money
laundering activities.
''(2) Cooperation and information sharing procedures. - The
regulations adopted under paragraph (1) may include or create
procedures for cooperation and information sharing focusing on -
''(A) matters specifically related to the finances of
terrorist groups, the means by which terrorist groups transfer
funds around the world and within the United States, including
through the use of charitable organizations, nonprofit
organizations, and nongovernmental organizations, and the
extent to which financial institutions in the United States are
unwittingly involved in such finances and the extent to which
such institutions are at risk as a result;
''(B) the relationship, particularly the financial
relationship, between international narcotics traffickers and
foreign terrorist organizations, the extent to which their
memberships overlap and engage in joint activities, and the
extent to which they cooperate with each other in raising and
transferring funds for their respective purposes; and
''(C) means of facilitating the identification of accounts
and transactions involving terrorist groups and facilitating
the exchange of information concerning such accounts and
transactions between financial institutions and law enforcement
organizations.
''(3) Contents. - The regulations adopted pursuant to paragraph
(1) may -
''(A) require that each financial institution designate 1 or
more persons to receive information concerning, and to monitor
accounts of individuals, entities, and organizations
identified, pursuant to paragraph (1); and
''(B) further establish procedures for the protection of the
shared information, consistent with the capacity, size, and
nature of the institution to which the particular procedures
apply.
''(4) Rule of construction. - The receipt of information by a
financial institution pursuant to this section shall not relieve
or otherwise modify the obligations of the financial institution
with respect to any other person or account.
''(5) Use of information. - Information received by a financial
institution pursuant to this section shall not be used for any
purpose other than identifying and reporting on activities that
may involve terrorist acts or money laundering activities.
''(b) Cooperation Among Financial Institutions. - Upon notice
provided to the Secretary, 2 or more financial institutions and any
association of financial institutions may share information with
one another regarding individuals, entities, organizations, and
countries suspected of possible terrorist or money laundering
activities. A financial institution or association that transmits,
receives, or shares such information for the purposes of
identifying and reporting activities that may involve terrorist
acts or money laundering activities shall not be liable to any
person under any law or regulation of the United States, any
constitution, law, or regulation of any State or political
subdivision thereof, or under any contract or other legally
enforceable agreement (including any arbitration agreement), for
such disclosure or for any failure to provide notice of such
disclosure to the person who is the subject of such disclosure, or
any other person identified in the disclosure, except where such
transmission, receipt, or sharing violates this section or
regulations promulgated pursuant to this section.
''(c) Rule of Construction. - Compliance with the provisions of
this title (see Short Title of 2001 Amendment note set out under
section 5301 of this title) requiring or allowing financial
institutions and any association of financial institutions to
disclose or share information regarding individuals, entities, and
organizations engaged in or suspected of engaging in terrorist acts
or money laundering activities shall not constitute a violation of
the provisions of title V of the Gramm-Leach-Bliley Act (Public Law
106-102) (15 U.S.C. 6801 et seq.).
''(d) Reports to the Financial Services Industry on Suspicious
Financial Activities. - At least semiannually, the Secretary shall
-
''(1) publish a report containing a detailed analysis
identifying patterns of suspicious activity and other
investigative insights derived from suspicious activity reports
and investigations conducted by Federal, State, and local law
enforcement agencies to the extent appropriate; and
''(2) distribute such report to financial institutions (as
defined in section 5312 of title 31, United States Code).''
REPORT AND RECOMMENDATION ON LEGISLATIVE ACTION ON INTERNATIONAL
COUNTER MONEY LAUNDERING PROVISIONS
Pub. L. 107-56, title III, Sec. 324, Oct. 26, 2001, 115 Stat.
316, provided that: ''Not later than 30 months after the date of
enactment of this Act (Oct. 26, 2001), the Secretary (of the
Treasury), in consultation with the Attorney General, the Federal
banking agencies (as defined at section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813)), the National Credit Union
Administration Board, the Securities and Exchange Commission, and
such other agencies as the Secretary may determine, at the
discretion of the Secretary, shall evaluate the operations of the
provisions of this subtitle (subtitle A (Sec. 311-330) of title III
of Pub. L. 107-56, enacting section 5318A of this title, amending
sections 5312 and 5318 of this title, sections 1828 and 1842 of
Title 12, Banks and Banking, sections 981, 983, and 1956 of Title
18, Crimes and Criminal Procedure, section 853 of Title 21, Food
and Drugs, and sections 2466 and 2467 of Title 28, Judiciary and
Judicial Procedure, and enacting provisions set out as notes under
this section and section 5318 of this title, sections 1828 and 1842
of Title 12, and section 983 of Title 18) and make recommendations
to Congress as to any legislative action with respect to this
subtitle as the Secretary may determine to be necessary or
advisable.''
INTERNATIONAL COOPERATION ON IDENTIFICATION OF ORIGINATORS OF WIRE
TRANSFERS
Pub. L. 107-56, title III, Sec. 328, Oct. 26, 2001, 115 Stat.
319, provided that: ''The Secretary (of the Treasury) shall -
''(1) in consultation with the Attorney General and the
Secretary of State, take all reasonable steps to encourage
foreign governments to require the inclusion of the name of the
originator in wire transfer instructions sent to the United
States and other countries, with the information to remain with
the transfer from its origination until the point of
disbursement; and
''(2) report annually to the Committee on Financial Services of
the House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate on -
''(A) progress toward the goal enumerated in paragraph (1),
as well as impediments to implementation and an estimated
compliance rate; and
''(B) impediments to instituting a regime in which all
appropriate identification, as defined by the Secretary, about
wire transfer recipients shall be included with wire transfers
from their point of origination until disbursement.''
CRIMINAL PENALTIES
Pub. L. 107-56, title III, Sec. 329, Oct. 26, 2001, 115 Stat.
319, provided that: ''Any person who is an official or employee of
any department, agency, bureau, office, commission, or other entity
of the Federal Government, and any other person who is acting for
or on behalf of any such entity, who, directly or indirectly, in
connection with the administration of this title (see Short Title
of 2001 Amendment note set out under section 5301 of this title),
corruptly demands, seeks, receives, accepts, or agrees to receive
or accept anything of value personally or for any other person or
entity in return for -
''(1) being influenced in the performance of any official act;
''(2) being influenced to commit or aid in the committing, or
to collude in, or allow, any fraud, or make opportunity for the
commission of any fraud, on the United States; or
''(3) being induced to do or omit to do any act in violation of
the official duty of such official or person,
shall be fined in an amount not more than 3 times the monetary
equivalent of the thing of value, or imprisoned for not more than
15 years, or both. A violation of this section shall be subject to
chapter 227 of title 18, United States Code, and the provisions of
the United States Sentencing Guidelines.''
REPORT ON INVESTMENT COMPANIES
Pub. L. 107-56, title III, Sec. 356(c), Oct. 26, 2001, 115 Stat.
324, provided that:
''(1) In general. - Not later than 1 year after the date of
enactment of this Act (Oct. 26, 2001), the Secretary (of the
Treasury), the Board of Governors of the Federal Reserve System,
and the Securities and Exchange Commission shall jointly submit a
report to the Congress on recommendations for effective regulations
to apply the requirements of subchapter II of chapter 53 of title
31, United States Code, to investment companies pursuant to section
5312(a)(2)(I) of title 31, United States Code.
''(2) Definition. - For purposes of this subsection, the term
'investment company' -
''(A) has the same meaning as in section 3 of the Investment
Company Act of 1940 (15 U.S.C. 80a-3); and
''(B) includes any person that, but for the exceptions provided
for in paragraph (1) or (7) of section 3(c) of the Investment
Company Act of 1940 (15 U.S.C. 80a-3(c)), would be an investment
company.
''(3) Additional recommendations. - The report required by
paragraph (1) may make different recommendations for different
types of entities covered by this subsection.
''(4) Beneficial ownership of personal holding companies. - The
report described in paragraph (1) shall also include
recommendations as to whether the Secretary should promulgate
regulations to treat any corporation or business or other grantor
trust whose assets are predominantly securities, bank certificates
of deposit, or other securities or investment instruments (other
than such as relate to operating subsidiaries of such corporation
or trust) and that has 5 or fewer common shareholders or holders of
beneficial or other equity interest, as a financial institution
within the meaning of that phrase in section 5312(a)(2)(I) and
whether to require such corporations or trusts to disclose their
beneficial owners when opening accounts or initiating funds
transfers at any domestic financial institution.''
REPORT ON NEED FOR ADDITIONAL LEGISLATION RELATING TO INFORMAL
MONEY TRANSFER SYSTEMS
Pub. L. 107-56, title III, Sec. 359(d), Oct. 26, 2001, 115 Stat.
329, provided that: ''Not later than 1 year after the date of
enactment of this Act (Oct. 26, 2001), the Secretary of the
Treasury shall report to Congress on the need for any additional
legislation relating to persons who engage as a business in an
informal money transfer system or any network of people who engage
as a business in facilitating the transfer of money domestically or
internationally outside of the conventional financial institutions
system, counter money laundering and regulatory controls relating
to underground money movement and banking systems, including
whether the threshold for the filing of suspicious activity reports
under section 5318(g) of title 31, United States Code should be
lowered in the case of such systems.''
UNIFORM STATE LICENSING AND REGULATION OF CHECK CASHING, CURRENCY
EXCHANGE, AND MONEY TRANSMITTING BUSINESSES
Pub. L. 103-325, title IV, Sec. 407, Sept. 23, 1994, 108 Stat.
2247, provided that:
''(a) Uniform Laws and Enforcement. - For purposes of preventing
money laundering and protecting the payment system from fraud and
abuse, it is the sense of the Congress that the several States
should -
''(1) establish uniform laws for licensing and regulating
businesses which -
''(A) provide check cashing, currency exchange, or money
transmitting or remittance services, or issue or redeem money
orders, travelers' checks, and other similar instruments; and
''(B) are not depository institutions (as defined in section
5313(g) of title 31, United States Code); and
''(2) provide sufficient resources to the appropriate State
agency to enforce such laws and regulations prescribed pursuant
to such laws.
''(b) Model Statute. - It is the sense of the Congress that the
several States should develop, through the auspices of the National
Conference of Commissioners on Uniform State Laws, the American Law
Institute, or such other forum as the States may determine to be
appropriate, a model statute to carry out the goals described in
subsection (a) which would include the following:
''(1) Licensing requirements. - A requirement that any business
described in subsection (a)(1) be licensed and regulated by an
appropriate State agency in order to engage in any such activity
within the State.
''(2) Licensing standards. - A requirement that -
''(A) in order for any business described in subsection
(a)(1) to be licensed in the State, the appropriate State
agency shall review and approve -
''(i) the business record and the capital adequacy of the
business seeking the license; and
''(ii) the competence, experience, integrity, and financial
ability of any individual who -
''(I) is a director, officer, or supervisory employee of such
business; or
''(II) owns or controls such business; and
''(B) any record, on the part of any business seeking the
license or any person referred to in subparagraph (A)(ii), of -
''(i) any criminal activity;
''(ii) any fraud or other act of personal dishonesty;
''(iii) any act, omission, or practice which constitutes a
breach of a fiduciary duty; or
''(iv) any suspension or removal, by any agency or
department of the United States or any State, from
participation in the conduct of any federally or State
licensed or regulated business,
may be grounds for the denial of any such license by the
appropriate State agency.
''(3) Reporting requirements. - A requirement that any business
described in subsection (a)(1) -
''(A) disclose to the appropriate State agency the fees
charged to consumers for services described in subsection
(a)(1)(A); and
''(B) conspicuously disclose to the public, at each location
of such business, the fees charged to consumers for such
services.
''(4) Procedures to ensure compliance with federal cash
transaction reporting requirements. - A civil or criminal penalty
for operating any business referred to in paragraph (1) without
establishing and complying with appropriate procedures to ensure
compliance with subchapter II of chapter 53 of title 31, United
States Code (relating to records and reports on monetary
instruments transactions).
''(5) Criminal penalties for operation of business without a
license. - A criminal penalty for operating any business referred
to in paragraph (1) without a license within the State after the
end of an appropriate transition period beginning on the date of
enactment of such model statute by the State.
''(c) Study Required. - The Secretary of the Treasury shall
conduct a study of -
''(1) the progress made by the several States in developing and
enacting a model statute which -
''(A) meets the requirements of subsection (b); and
''(B) furthers the goals of -
''(i) preventing money laundering by businesses which are
required to be licensed under any such statute; and
''(ii) protecting the payment system, including the
receipt, payment, collection, and clearing of checks, from
fraud and abuse by such businesses; and
''(2) the adequacy of -
''(A) the activity of the several States in enforcing the
requirements of such statute; and
''(B) the resources made available to the appropriate State
agencies for such enforcement activity.
''(d) Report Required. - Not later than the end of the 3-year
period beginning on the date of enactment of this Act (Sept. 23,
1994) and not later than the end of each of the first two 1-year
periods beginning after the end of such 3-year period, the
Secretary of the Treasury shall submit a report to the Congress
containing the findings and recommendations of the Secretary in
connection with the study under subsection (c), together with such
recommendations for legislative and administrative action as the
Secretary may determine to be appropriate.
''(e) Recommendations in Cases of Inadequate Regulation and
Enforcement by States. - If the Secretary of the Treasury
determines that any State has been unable to -
''(1) enact a statute which meets the requirements described in
subsection (b);
''(2) undertake adequate activity to enforce such statute; or
''(3) make adequate resources available to the appropriate
State agency for such enforcement activity,
the report submitted pursuant to subsection (d) shall contain
recommendations of the Secretary which are designed to facilitate
the enactment and enforcement by the State of such a statute.
''(f) Federal Funding Study. -
''(1) Study required. - The Secretary of the Treasury shall
conduct a study to identify possible available sources of Federal
funding to cover costs which will be incurred by the States in
carrying out the purposes of this section.
''(2) Report. - The Secretary of the Treasury shall submit a
report to the Congress on the study conducted pursuant to
paragraph (1) not later than the end of the 18-month period
beginning on the date of enactment of this Act (Sept. 23,
1994).''
ANTI-MONEY LAUNDERING TRAINING TEAM
Pub. L. 102-550, title XV, Sec. 1518, Oct. 28, 1992, 106 Stat.
4060, provided that: ''The Secretary of the Treasury and the
Attorney General shall jointly establish a team of experts to
assist and provide training to foreign governments and agencies
thereof in developing and expanding their capabilities for
investigating and prosecuting violations of money laundering and
related laws.''
ADVISORY GROUP ON REPORTING REQUIREMENTS
Pub. L. 102-550, title XV, Sec. 1564, Oct. 28, 1992, 106 Stat.
4073, provided that:
''(a) Establishment. - Not later than 90 days after the date of
the enactment of this Act (Oct. 28, 1992), the Secretary of the
Treasury shall establish a Bank Secrecy Act Advisory Group
consisting of representatives of the Department of the Treasury,
the Department of Justice, and the Office of National Drug Control
Policy and of other interested persons and financial institutions
subject to the reporting requirements of subchapter II of chapter
53 of title 31, United States Code, or section 6050I of the
Internal Revenue Code of 1986 (26 U.S.C. 6050I).
''(b) Purposes. - The Advisory Group shall provide a means by
which the Secretary -
''(1) informs private sector representatives, on a regular
basis, of the ways in which the reports submitted pursuant to the
requirements referred to in subsection (a) have been used;
''(2) informs private sector representatives, on a regular
basis, of how information regarding suspicious financial
transactions provided voluntarily by financial institutions has
been used; and
''(3) receives advice on the manner in which the reporting
requirements referred to in subsection (a) should be modified to
enhance the ability of law enforcement agencies to use the
information provided for law enforcement purposes.
''(c) Inapplicability of Federal Advisory Committee Act. - The
Federal Advisory Committee Act (5 App. U.S.C.) shall not apply to
the Bank Secrecy Act Advisory Group established pursuant to
subsection (a).''
GAO FEASIBILITY STUDY OF FINANCIAL CRIMES ENFORCEMENT NETWORK
Pub. L. 102-550, title XV, Sec. 1565, Oct. 28, 1992, 106 Stat.
4074, provided that:
''(a) Study Required. - The Comptroller General of the United
States shall conduct a feasibility study of the Financial Crimes
Enforcement Network (popularly referred to as 'Fincen') established
by the Secretary of the Treasury in cooperation with other agencies
and departments of the United States and appropriate Federal
banking agencies.
''(b) Specific Requirements. - In conducting the study required
under subsection (a), the Comptroller General shall examine and
evaluate -
''(1) the extent to which Federal, State, and local
governmental and nongovernmental organizations are voluntarily
providing information which is necessary for the system to be
useful for law enforcement purposes;
''(2) the extent to which the operational guidelines
established for the system provide for the coordinated and
efficient entry of information into, and withdrawal of
information from, the system;
''(3) the extent to which the operating procedures established
for the system provide appropriate standards or guidelines for
determining -
''(A) who is to be given access to the information in the
system;
''(B) what limits are to be imposed on the use of such
information; and
''(C) how information about activities or relationships which
involve or are closely associated with the exercise of
constitutional rights is to be screened out of the system; and
''(4) the extent to which the operating procedures established
for the system provide for the prompt verification of the
accuracy and completeness of information entered into the system
and the prompt deletion or correction of inaccurate or incomplete
information.
''(c) Report to Congress. - Before the end of the 1-year period,
beginning on the date of the enactment of this Act (Oct. 28, 1992),
the Comptroller General of the United States shall submit a report
to the Congress containing the findings and conclusions of the
Comptroller General in connection with the study conducted pursuant
to subsection (a), together with such recommendations for
legislative or administrative action as the Comptroller General may
determine to be appropriate.''
REPORTS ON USES MADE OF CURRENCY TRANSACTION REPORTS
Pub. L. 101-647, title I, Sec. 101, Nov. 29, 1990, 104 Stat.
4789, provided that: ''Not later than 180 days after the effective
date of this section (Nov. 29, 1990), and every 2 years for 4
years, the Secretary of the Treasury shall report to the Congress
the following:
''(1) the number of each type of report filed pursuant to
subchapter II of chapter 53 of title 31, United States Code (or
regulations promulgated thereunder) in the previous fiscal year;
''(2) the number of reports filed pursuant to section 6050I of
the Internal Revenue Code of 1986 (26 U.S.C. 6050I) (regarding
transactions involving currency) in the previous fiscal year;
''(3) an estimate of the rate of compliance with the reporting
requirements by persons required to file the reports referred to
in paragraphs (1) and (2);
''(4) the manner in which the Department of the Treasury and
other agencies of the United States collect, organize, analyze
and use the reports referred to in paragraphs (1) and (2) to
support investigations and prosecutions of (A) violations of the
criminal laws of the United States, (B) violations of the laws of
foreign countries, and (C) civil enforcement of the laws of the
United States including the provisions regarding asset
forfeiture;
''(5) a summary of sanctions imposed in the previous fiscal
year against persons who failed to comply with the reporting
requirements referred to in paragraphs (1) and (2), and other
steps taken to ensure maximum compliance;
''(6) a summary of criminal indictments filed in the previous
fiscal year which resulted, in large part, from investigations
initiated by analysis of the reports referred to in paragraphs
(1) and (2); and
''(7) a summary of criminal indictments filed in the previous
fiscal year which resulted, in large part, from investigations
initiated by information regarding suspicious financial
transactions provided voluntarily by financial institutions.''
INTERNATIONAL CURRENCY TRANSACTION REPORTING
Pub. L. 100-690, title IV, Sec. 4701, Nov. 18, 1988, 102 Stat.
4290, stated Congressional findings concerning success of cash
transaction and money laundering control statutes in United States
and desirability of United States playing a leadership role in
development of similar international system, urged United States
Government to seek active cooperation of other countries in
enforcement of such statutes, urged Secretary of the Treasury to
negotiate with finance ministers of foreign countries to establish
an international currency control agency to serve as central source
of information and database for international drug enforcement
agencies to collect and analyze currency transaction reports filed
by member countries, and encouraged adoption, by member countries,
of uniform cash transaction and money laundering statutes, prior to
repeal by Pub. L. 102-583, Sec. 6(e)(1), Nov. 2, 1992, 106 Stat.
4933.
RESTRICTIONS ON LAUNDERING OF UNITED STATES CURRENCY
Pub. L. 100-690, title IV, Sec. 4702, Nov. 18, 1988, 102 Stat.
4291, as amended by Pub. L. 103-447, title I, Sec. 103(b), Nov. 2,
1994, 108 Stat. 4693, provided that:
''(a) Findings. - The Congress finds that international currency
transactions, especially in United States currency, that involve
the proceeds of narcotics trafficking fuel trade in narcotics in
the United States and worldwide and consequently are a threat to
the national security of the United States.
''(b) Purpose. - The purpose of this section is to provide for
international negotiations that would expand access to information
on transactions involving large amounts of United States currency
wherever those transactions occur worldwide.
''(c) Negotiations. - (1) The Secretary of the Treasury
(hereinafter in this section referred to as the 'Secretary') shall
enter into negotiations with the appropriate financial supervisory
agencies and other officials of any foreign country the financial
institutions of which do business in United States currency.
Highest priority shall be attached to countries whose financial
institutions the Secretary determines, in consultation with the
Attorney General and the Director of National Drug Control Policy,
may be engaging in currency transactions involving the proceeds of
international narcotics trafficking, particularly United States
currency derived from drug sales in the United States.
''(2) The purposes of negotiations under this subsection are -
''(A) to reach one or more international agreements to ensure
that foreign banks and other financial institutions maintain
adequate records of large United States currency transactions,
and
''(B) to establish a mechanism whereby such records may be made
available to United States law enforcement officials.
In carrying out such negotiations, the Secretary should seek to
enter into and further cooperative efforts, voluntary information
exchanges, the use of letters rogatory, and mutual legal assistance
treaties.
''(d) Reports. - Not later than 1 year after the date of
enactment of this Act (Nov. 18, 1988), the Secretary shall submit
an interim report to the Committee on Banking, Finance and Urban
Affairs of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate on progress in
the negotiations under subsection (c). Not later than 2 years after
such enactment, the Secretary shall submit a final report to such
Committees and the President on the outcome of those negotiations
and shall identify, in consultation with the Attorney General and
the Director of National Drug Control Policy, countries -
''(1) with respect to which the Secretary determines there is
evidence that the financial institutions in such countries are
engaging in currency transactions involving the proceeds of
international narcotics trafficking; and
''(2) which have not reached agreement with United States
authorities on a mechanism for exchanging adequate records on
international currency transactions in connection with narcotics
investigations and proceedings.
''(e) Authority. - If after receiving the advice of the Secretary
and in any case at the time of receipt of the Secretary's report,
the Secretary determines that a foreign country -
''(1) has jurisdiction over financial institutions that are
substantially engaging in currency transactions that effect
(affect) the United States involving the proceeds of
international narcotics trafficking;
''(2) such country has not reached agreement on a mechanism for
exchanging adequate records on international currency
transactions in connection with narcotics investigations and
proceedings; and
''(3) such country is not negotiating in good faith to reach
such an agreement,
the President shall impose appropriate penalties and sanctions,
including temporarily or permanently -
''(1) prohibiting such persons, institutions or other entities
in such countries from participating in any United States dollar
clearing or wire transfer system; and
''(2) prohibiting such persons, institutions or entities in
such countries from maintaining an account with any bank or other
financial institution chartered under the laws of the United
States or any State.
Any penalties or sanctions so imposed may be delayed or waived upon
certification of the President to the Congress that it is in the
national interest to do so. Financial institutions in such
countries that maintain adequate records shall be exempt from such
penalties and sanctions.
''(f) Definitions. - For the purposes of this section -
''(1) The term 'United States currency' means Federal Reserve
Notes and United States coins.
''(2) The term 'adequate records' means records of United
States' currency transactions in excess of $10,000 including the
identification of the person initiating the transaction, the
person's business or occupation, and the account or accounts
affected by the transaction, or other records of comparable
effect.''
INTERNATIONAL INFORMATION EXCHANGE SYSTEM; STUDY OF FOREIGN
BRANCHES OF DOMESTIC INSTITUTIONS
Pub. L. 99-570, title I, Sec. 1363, Oct. 27, 1986, 100 Stat.
3207-33, required the Secretary of the Treasury to initiate
discussions with the central banks or other appropriate
governmental authorities of other countries and propose that an
information exchange system be established to reduce international
flow of money derived from illicit drug operations and other
criminal activities and to report to Congress before the end of the
9-month period beginning Oct. 27, 1986. The Secretary of the
Treasury was also required to conduct a study of (1) the extent to
which foreign branches of domestic institutions are used to
facilitate illicit transfers of or to evade reporting requirements
on transfers of coins, currency, and other monetary instruments
into and out of the United States; (2) the extent to which the law
of the United States is applicable to the activities of such
foreign branches; and (3) methods for obtaining the cooperation of
the country in which any such foreign branch is located for
purposes of enforcing the law of the United States with respect to
transfers, and reports on transfers, of such monetary instruments
into and out of the United States and to report to Congress before
the end of the 9-month period beginning Oct. 27, 1986.
-CITE-
31 USC Sec. 5312 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5312. Definitions and application
-STATUTE-
(a) In this subchapter -
(1) ''financial agency'' means a person acting for a person
(except for a country, a monetary or financial authority acting
as a monetary or financial authority, or an international
financial institution of which the United States Government is a
member) as a financial institution, bailee, depository trustee,
or agent, or acting in a similar way related to money, credit,
securities, gold, or a transaction in money, credit, securities,
or gold.
(2) ''financial institution'' means -
(A) an insured bank (as defined in section 3(h) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(h)));
(B) a commercial bank or trust company;
(C) a private banker;
(D) an agency or branch of a foreign bank in the United
States;
(E) any credit union;
(F) a thrift institution;
(G) a broker or dealer registered with the Securities and
Exchange Commission under the Securities Exchange Act of 1934
(15 U.S.C. 78a et seq.);
(H) a broker or dealer in securities or commodities;
(I) an investment banker or investment company;
(J) a currency exchange;
(K) an issuer, redeemer, or cashier of travelers' checks,
checks, money orders, or similar instruments;
(L) an operator of a credit card system;
(M) an insurance company;
(N) a dealer in precious metals, stones, or jewels;
(O) a pawnbroker;
(P) a loan or finance company;
(Q) a travel agency;
(R) a licensed sender of money or any other person who
engages as a business in the transmission of funds, including
any person who engages as a business in an informal money
transfer system or any network of people who engage as a
business in facilitating the transfer of money domestically or
internationally outside of the conventional financial
institutions system;
(S) a telegraph company;
(T) a business engaged in vehicle sales, including
automobile, airplane, and boat sales;
(U) persons involved in real estate closings and settlements;
(V) the United States Postal Service;
(W) an agency of the United States Government or of a State
or local government carrying out a duty or power of a business
described in this paragraph;
(X) a casino, gambling casino, or gaming establishment with
an annual gaming revenue of more than $1,000,000 which -
(i) is licensed as a casino, gambling casino, or gaming
establishment under the laws of any State or any political
subdivision of any State; or
(ii) is an Indian gaming operation conducted under or
pursuant to the Indian Gaming Regulatory Act other than an
operation which is limited to class I gaming (as defined in
section 4(6) of such Act);
(Y) any business or agency which engages in any activity
which the Secretary of the Treasury determines, by regulation,
to be an activity which is similar to, related to, or a
substitute for any activity in which any business described in
this paragraph is authorized to engage; or
(Z) any other business designated by the Secretary whose cash
transactions have a high degree of usefulness in criminal, tax,
or regulatory matters.
(3) ''monetary instruments'' means -
(A) United States coins and currency;
(B) as the Secretary may prescribe by regulation, coins and
currency of a foreign country, travelers' checks, bearer
negotiable instruments, bearer investment securities, bearer
securities, stock on which title is passed on delivery, and
similar material; and
(C) as the Secretary of the Treasury shall provide by
regulation for purposes of sections 5333 (FOOTNOTE 1) and 5316,
checks, drafts, notes, money orders, and other similar
instruments which are drawn on or by a foreign financial
institution and are not in bearer form.
(FOOTNOTE 1) So in original. This title does not contain a
section 5333.
(4) Nonfinancial trade or business. - The term ''nonfinancial
trade or business'' means any trade or business other than a
financial institution that is subject to the reporting
requirements of section 5313 and regulations prescribed under
such section.
(5) ''person'', in addition to its meaning under section 1 of
title 1, includes a trustee, a representative of an estate and,
when the Secretary prescribes, a governmental entity.
(6) ''United States'' means the States of the United States,
the District of Columbia, and, when the Secretary prescribes by
regulation, the Commonwealth of Puerto Rico, the Virgin Islands,
Guam, the Northern Mariana Islands, American Samoa, the Trust
Territory of the Pacific Islands, a territory or possession of
the United States, or a military or diplomatic establishment.
(b) In this subchapter -
(1) ''domestic financial agency'' and ''domestic financial
institution'' apply to an action in the United States of a
financial agency or institution.
(2) ''foreign financial agency'' and ''foreign financial
institution'' apply to an action outside the United States of a
financial agency or institution.
(c) Additional Definitions. - For purposes of this subchapter,
the following definitions shall apply:
(1) (FOOTNOTE 2) Certain institutions included in definition. -
The term ''financial institution'' (as defined in subsection (a))
includes the following:
(FOOTNOTE 2) So in original. No par. (2) has been enacted.
(A) (FOOTNOTE 3) Any futures commission merchant, commodity
trading advisor, or commodity pool operator registered, or
required to register, under the Commodity Exchange Act.
(FOOTNOTE 3) So in original. No subpar. (B) has been enacted.
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 995; Pub. L. 99-570,
title I, Sec. 1362, Oct. 27, 1986, 100 Stat. 3207-33; Pub. L.
100-690, title VI, Sec. 6185(a), (g)(1), Nov. 18, 1988, 102 Stat.
4354, 4357; Pub. L. 103-325, title IV, Sec. 405, 409, Sept. 23,
1994, 108 Stat. 2247, 2252; Pub. L. 107-56, title III, Sec. 321(a),
(b), 359(a), 365(c)(1), (2)(A), Oct. 26, 2001, 115 Stat. 315, 328,
335.)
-MISC1-
Historical and Revision Notes
---------------------------------------------------------------------
Revised Section Source (U.S. Code) Source (Statutes at
Large)
---------------------------------------------------------------------
5312(a)(1) 31:1052(a), (b), Oct. 26, 1970, Pub.
(g), (i). L. 91-508, Sec.
203(a)-(i), (l), 84
Stat. 1118.
5312(a)(2) 31:1052(e).
5312(a)(3) 31:1052(l).
5312(a)(4) 31:1052(c).
5312(a)(5) 31:1052(d).
5312(b) 31:1052(f), (h).
-------------------------------
In subsection (a)(1), the text of 31:1052(a) is omitted as
unnecessary. The text of 31:1052(b) is omitted because of the
restatement. The text of 31:1052(i) is omitted as unnecessary
because the source provision is restated where necessary in the
revised subchapter.
In subsection (a)(2), (3), (4), and (5), the words ''the
Secretary . . . prescribes'' are substituted for ''specified by the
Secretary by regulation'', ''as the Secretary may by regulation
specify'', ''specified by the Secretary'', and ''the Secretary
shall by regulation specify'' for consistency.
In subsection (a)(2) and (3), the words ''for the purposes of the
provision of this chapter to which the regulation relates'' are
omitted as surplus.
In subsection (a)(2), before subclause (A), the words ''any
person which does business in any one or more of the following
capacities'' are omitted as surplus. In subclause (F), the words
''savings bank, building and loan association, credit union,
industrial bank, or other'' are omitted as surplus. In subclause
(T), the words ''agency of the United States Government or of a
State or local government'' are substituted for ''Federal, State,
or local government institution'' for consistency. In subclause
(U), the words ''type of'' are omitted as surplus. The word
''agency'' is substituted for ''institution'' for consistency.
In subsection (a)(3)(B)-(5), the word ''prescribe'' is
substituted for ''specify'' for consistency in the revised title
and with other titles of the United States Code.
In subsection (a)(3)(B), the words ''in addition'', and ''and
such types of'' are omitted as surplus. The words ''similar
material'' are substituted for ''the equivalent thereof'' for
clarity.
In subsection (a)(4), the words ''in addition to its meaning
under section 1 of title 1'' are substituted for ''natural persons,
partnerships, . . . associations, corporations, and all entities
cognizable as legal personalities'' for consistency because 1:1 is
applicable to all laws unless otherwise provided. The words ''a
trustee, a representative of an estate'' are substituted for
''trusts, estates'', and the word ''entity'' is substituted for
''department or agency'', for consistency. The words ''either for
the purpose of this chapter generally or any particular requirement
thereunder'' are omitted as surplus.
In subsection (a)(5), the words ''used in a geographic sense''
are omitted because of the restatement. The words ''either for the
purposes of this chapter generally or any particular requirement
thereunder'' are omitted as surplus. The words ''territory or''
are added for consistency.
Subsection (b) is substituted for 31:1052(f) and (h) to eliminate
unnecessary words and for consistency.
-REFTEXT-
REFERENCES IN TEXT
The Securities Exchange Act of 1934, referred to in subsec.
(a)(2)(G), is act June 6, 1934, ch. 404, 48 Stat. 881, as amended,
which is classified principally to chapter 2B (Sec. 78a et seq.) of
Title 15, Commerce and Trade. For complete classification of this
Act to the Code, see section 78a of Title 15 and Tables.
The Indian Gaming Regulatory Act, referred to in subsec.
(a)(2)(X)(ii), is Pub. L. 100-497, Oct. 17, 1988, 102 Stat. 2467,
as amended, which is classified principally to chapter 29 (Sec.
2701 et seq.) of Title 25, Indians. Section 4(6) of the Act is
classified to section 2703(6) of Title 25. For complete
classification of this Act to the Code, see Short Title note set
out under section 2701 of this title and Tables.
The Commodity Exchange Act, referred to in subsec. (c)(1)(A), is
act Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended, which is
classified generally to chapter 1 (Sec. 1 et seq.) of Title 7,
Agriculture. For complete classification of this Act to the Code,
see section 1 of Title 7 and Tables.
-COD-
CODIFICATION
Another section 365(c) of Pub. L. 107-56 amended the table of
sections at the beginning of this chapter.
-MISC3-
AMENDMENTS
2001 - Subsec. (a)(2)(E). Pub. L. 107-56, Sec. 321(a), which
directed the general amendment of par. (2)(E) of this section, was
executed to subsec. (a)(2)(E) of this section to reflect the
probable intent of Congress. Prior to amendment, subsec. (a)(2)(E)
read as follows: ''an insured institution (as defined in section
401(a) of the National Housing Act (12 U.S.C. 1724(a)));''.
Subsec. (a)(2)(R). Pub. L. 107-56, Sec. 359(a), amended subpar.
(R) generally. Prior to amendment, subpar. (R) read as follows:
''a licensed sender of money;''.
Subsec. (a)(3)(C). Pub. L. 107-56, Sec. 365(c)(2)(A), substituted
''sections 5333 and 5316,'' for ''section 5316,''.
Subsec. (a)(4) to (6). Pub. L. 107-56, Sec. 365(c)(1), added par.
(4) and redesignated former pars. (4) and (5) as (5) and (6),
respectively.
Subsec. (c). Pub. L. 107-56, Sec. 321(b), added subsec. (c).
1994 - Subsec. (a)(2)(X) to (Z). Pub. L. 103-325, Sec. 409, added
subpar. (X) and redesignated former subpars. (X) and (Y) as (Y) and
(Z), respectively.
Subsec. (a)(3)(C). Pub. L. 103-325, Sec. 405, added subpar. (C).
1988 - Subsec. (a)(2)(T) to (Y). Pub. L. 100-690, Sec. 6185(a),
added subpars. (T) to (Y) and struck out former subpars. (T) and
(U) which read as follows:
''(T) an agency of the United States Government or of a State or
local government carrying out a duty or power of a business
described in this clause (2), including the United States Postal
Service; or
''(U) another business or agency carrying out a similar, related,
or substitute duty or power the Secretary of the Treasury
prescribes.''
Subsec. (a)(5). Pub. L. 100-690, Sec. 6185(g)(1), inserted a
comma after ''Puerto Rico'' and struck out second comma after
''Pacific Islands''.
1986 - Subsec. (a)(2)(T). Pub. L. 99-570, Sec. 1362(a), which
directed that the Postal Service be included within United States
agencies by amending subsec. (a)(2)(U) of this section by inserting
before the semicolon at the end thereof the following '', including
the United States Postal Service'', was executed to subsec.
(a)(2)(T) of this section as the probable intent of Congress,
because subsec. (a)(2)(U) does not contain a semicolon and subsec.
(a)(2)(T) relates to United States agencies.
Subsec. (a)(5). Pub. L. 99-570, Sec. 1362(b), inserted ''the
Virgin Islands, Guam, the Northern Mariana Islands, American Samoa,
the Trust Territory of the Pacific Islands,'' after ''Puerto
Rico''.
TERMINATION DATE OF 2001 AMENDMENT
Amendments by title III of Pub. L. 107-56 to terminate effective
on and after the first day of fiscal year 2005 if Congress enacts a
joint resolution that such amendments no longer have the force of
law, see section 303 of Pub. L. 107-56, set out as a Four-Year
Congressional Review; Expedited Consideration note under section
5311 of this title.
-TRANS-
TERMINATION OF TRUST TERRITORY OF THE PACIFIC ISLANDS
For termination of Trust Territory of the Pacific Islands, see
note set out preceding section 1681 of Title 48, Territories and
Insular Possessions.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 5318, 5331, 5340 of this
title; title 12 section 1953; title 18 sections 986, 1956, 2339B;
title 19 sections 1401, 1607; title 26 section 6050I; title 50
section 438.
-CITE-
31 USC Sec. 5313 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5313. Reports on domestic coins and currency transactions
-STATUTE-
(a) When a domestic financial institution is involved in a
transaction for the payment, receipt, or transfer of United States
coins or currency (or other monetary instruments the Secretary of
the Treasury prescribes), in an amount, denomination, or amount and
denomination, or under circumstances the Secretary prescribes by
regulation, the institution and any other participant in the
transaction the Secretary may prescribe shall file a report on the
transaction at the time and in the way the Secretary prescribes. A
participant acting for another person shall make the report as the
agent or bailee of the person and identify the person for whom the
transaction is being made.
(b) The Secretary may designate a domestic financial institution
as an agent of the United States Government to receive a report
under this section. However, the Secretary may designate a
domestic financial institution that is not insured, chartered,
examined, or registered as a domestic financial institution only if
the institution consents. The Secretary may suspend or revoke a
designation for a violation of this subchapter or a regulation
under this subchapter (except a violation of section 5315 of this
title or a regulation prescribed under section 5315), section 411
(FOOTNOTE 1) of the National Housing Act (12 U.S.C. 1730d), or
section 21 of the Federal Deposit Insurance Act (12 U.S.C. 1829b).
(FOOTNOTE 1) See References in Text note below.
(c)(1) A person (except a domestic financial institution
designated under subsection (b) of this section) required to file a
report under this section shall file the report -
(A) with the institution involved in the transaction if the
institution was designated;
(B) in the way the Secretary prescribes when the institution
was not designated; or
(C) with the Secretary.
(2) The Secretary shall prescribe -
(A) the filing procedure for a domestic financial institution
designated under subsection (b) of this section; and
(B) the way the institution shall submit reports filed with it.
(d) Mandatory Exemptions From Reporting Requirements. -
(1) In general. - The Secretary of the Treasury shall exempt,
pursuant to section 5318(a)(6), a depository institution from the
reporting requirements of subsection (a) with respect to
transactions between the depository institution and the following
categories of entities:
(A) Another depository institution.
(B) A department or agency of the United States, any State,
or any political subdivision of any State.
(C) Any entity established under the laws of the United
States, any State, or any political subdivision of any State,
or under an interstate compact between 2 or more States, which
exercises governmental authority on behalf of the United States
or any such State or political subdivision.
(D) Any business or category of business the reports on which
have little or no value for law enforcement purposes.
(2) Notice of exemption. - The Secretary of the Treasury shall
publish in the Federal Register at such times as the Secretary
determines to be appropriate (but not less frequently than once
each year) a list of all the entities whose transactions with a
depository institution are exempt under this subsection from the
reporting requirements of subsection (a).
(e) Discretionary Exemptions From Reporting Requirements. -
(1) In general. - The Secretary of the Treasury may exempt,
pursuant to section 5318(a)(6), a depository institution from the
reporting requirements of subsection (a) with respect to
transactions between the depository institution and a qualified
business customer of the institution on the basis of information
submitted to the Secretary by the institution in accordance with
procedures which the Secretary shall establish.
(2) Qualified business customer defined. - For purposes of this
subsection, the term ''qualified business customer'' means a
business which -
(A) maintains a transaction account (as defined in section
19(b)(1)(C) of the Federal Reserve Act) at the depository
institution;
(B) frequently engages in transactions with the depository
institution which are subject to the reporting requirements of
subsection (a); and
(C) meets criteria which the Secretary determines are
sufficient to ensure that the purposes of this subchapter are
carried out without requiring a report with respect to such
transactions.
(3) Criteria for exemption. - The Secretary of the Treasury
shall establish, by regulation, the criteria for granting and
maintaining an exemption under paragraph (1).
(4) Guidelines. -
(A) In general. - The Secretary of the Treasury shall
establish guidelines for depository institutions to follow in
selecting customers for an exemption under this subsection.
(B) Contents. - The guidelines may include a description of
the types of businesses or an itemization of specific
businesses for which no exemption will be granted under this
subsection to any depository institution.
(5) Annual review. - The Secretary of the Treasury shall
prescribe regulations requiring each depository institution to -
(A) review, at least once each year, the qualified business
customers of such institution with respect to whom an exemption
has been granted under this subsection; and
(B) upon the completion of such review, resubmit information
about such customers, with such modifications as the
institution determines to be appropriate, to the Secretary for
the Secretary's approval.
(6) 2-year phase-in provision. - During the 2-year period
beginning on the date of enactment of the Money Laundering
Suppression Act of 1994, this subsection shall be applied by the
Secretary on the basis of such criteria as the Secretary
determines to be appropriate to achieve an orderly implementation
of the requirements of this subsection.
(f) Provisions Applicable to Mandatory and Discretionary
Exemptions. -
(1) Limitation on liability of depository institutions. - No
depository institution shall be subject to any penalty which may
be imposed under this subchapter for the failure of the
institution to file a report with respect to a transaction with a
customer for whom an exemption has been granted under subsection
(d) or (e) unless the institution -
(A) knowingly files false or incomplete information to the
Secretary with respect to the transaction or the customer
engaging in the transaction; or
(B) has reason to believe at the time the exemption is
granted or the transaction is entered into that the customer or
the transaction does not meet the criteria established for
granting such exemption.
(2) Coordination with other provisions. - Any exemption granted
by the Secretary of the Treasury under section 5318(a) in
accordance with this section, and any transaction which is
subject to such exemption, shall be subject to any other
provision of law applicable to such exemption, including -
(A) the authority of the Secretary, under section 5318(a)(6),
to revoke such exemption at any time; and
(B) any requirement to report, or any authority to require a
report on, any possible violation of any law or regulation or
any suspected criminal activity.
(g) Depository Institution Defined. - For purposes of this
section, the term ''depository institution'' -
(1) has the meaning given to such term in section 19(b)(1)(A)
of the Federal Reserve Act; and
(2) includes -
(A) any branch, agency, or commercial lending company (as
such terms are defined in section 1(b) of the International
Banking Act of 1978);
(B) any corporation chartered under section 25A of the
Federal Reserve Act; and
(C) any corporation having an agreement or undertaking with
the Board of Governors of the Federal Reserve System under
section 25 of the Federal Reserve Act.
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 996; Pub. L. 103-325,
title IV, Sec. 402(a), Sept. 23, 1994, 108 Stat. 2243.)
-MISC1-
Historical and Revision Notes
---------------------------------------------------------------------
Revised Section Source (U.S. Code) Source (Statutes at
Large)
---------------------------------------------------------------------
5313(a) 31:1081. Oct. 26, 1970, Pub.
L. 91-508, Sec. 221-
223, 84 Stat. 1122.
31:1082.
5313(b) 31:1083(a).
5313(c) 31:1083(b).
-------------------------------
In subsection (a), the words ''coins or'' are added, and the
words ''prescribe'' and ''prescribes'' are substituted for
''specify'' in 31:1081, and ''require'', for consistency. The
words ''other parties thereto or'' in 31:1082 are omitted as
surplus. The words ''to the Secretary'' in 31:1081 are omitted as
unnecessary and for clarity. The words ''in such detail'' are
omitted as surplus. The words ''A participant acting for another
person shall make the report as the agent or bailee of the person
and identify the person for whom the transaction is being made''
are substituted for 31:1082(last sentence) for clarity and to
eliminate unnecessary words.
In subsection (b), the words ''in his discretion'' and
''individually or by class'' are omitted as surplus. The word
''Government'' is added for consistency. The words ''or a
regulation under this subchapter'', are added because of the
restatement. The words ''(except a violation of section 5315 of
this title or a regulation prescribed under section 5315)'' are
added because 31:1141-1143 was not enacted as a part of the
Currency and Foreign Transactions Reporting Act that is restated in
this subchapter.
In subsection (c)(1), clause (A) is substituted for ''with
respect to a domestic financial institution . . . with that
institution'' for clarity. Clause (C) is substituted for ''any
such person may, at his election and in lieu of filing the report
in the manner hereinabove prescribed, file the report with the
Secretary'' to eliminate unnecessary words.
-REFTEXT-
REFERENCES IN TEXT
Section 411 of the National Housing Act, referred to in subsec.
(b), which was classified to section 1730d of Title 12, Banks and
Banking, was repealed by Pub. L. 101-73, title IV, Sec. 407, Aug.
9, 1989, 103 Stat. 363.
Section 19(b)(1)(A) and (C) of the Federal Reserve Act, referred
to in subsecs. (e)(2)(A) and (g)(1), is classified to section
461(b)(1)(A) and (C) of Title 12.
The date of enactment of the Money Laundering Suppression Act of
1994, referred to in subsec. (e)(6), is the date of enactment of
title IV of Pub. L. 103-325, which was approved Sept. 23, 1994.
Section 1(b) of the International Banking Act of 1978, referred
to in subsec. (g)(2)(A), is classified to section 3101 of Title 12.
Sections 25 and 25A of the Federal Reserve Act, referred to in
subsec. (g)(2)(B), (C), are classified to subchapters I (Sec. 601
et seq.) and II (Sec. 611 et seq.), respectively, of chapter 6 of
Title 12.
-MISC2-
AMENDMENTS
1994 - Subsecs. (d) to (g). Pub. L. 103-325 added subsecs. (d) to
(g).
EFFICIENT USE OF CURRENCY TRANSACTION REPORT SYSTEM
Pub. L. 107-56, title III, Sec. 366, Oct. 26, 2001, 115 Stat.
335, provided that:
''(a) Findings. - The Congress finds the following:
''(1) The Congress established the currency transaction
reporting requirements in 1970 because the Congress found then
that such reports have a high degree of usefulness in criminal,
tax, and regulatory investigations and proceedings and the
usefulness of such reports has only increased in the years since
the requirements were established.
''(2) In 1994, in response to reports and testimony that excess
amounts of currency transaction reports were interfering with
effective law enforcement, the Congress reformed the currency
transaction report exemption requirements to provide -
''(A) mandatory exemptions for certain reports that had
little usefulness for law enforcement, such as cash transfers
between depository institutions and cash deposits from
government agencies; and
''(B) discretionary authority for the Secretary of the
Treasury to provide exemptions, subject to criteria and
guidelines established by the Secretary, for financial
institutions with regard to regular business customers that
maintain accounts at an institution into which frequent cash
deposits are made.
''(3) Today there is evidence that some financial institutions
are not utilizing the exemption system, or are filing reports
even if there is an exemption in effect, with the result that the
volume of currency transaction reports is once again interfering
with effective law enforcement.
''(b) Study and Report. -
''(1) Study required. - The Secretary shall conduct a study of
-
''(A) the possible expansion of the statutory exemption
system in effect under section 5313 of title 31, United States
Code; and
''(B) methods for improving financial institution utilization
of the statutory exemption provisions as a way of reducing the
submission of currency transaction reports that have little or
no value for law enforcement purposes, including improvements
in the systems in effect at financial institutions for regular
review of the exemption procedures used at the institution and
the training of personnel in its effective use.
''(2) Report required. - The Secretary of the Treasury shall
submit a report to the Congress before the end of the 1-year
period beginning on the date of enactment of this Act (Oct. 26,
2001) containing the findings and conclusions of the Secretary
with regard to the study required under subsection (a), and such
recommendations for legislative or administrative action as the
Secretary determines to be appropriate.''
REPORT REDUCTION GOAL; STREAMLINED CURRENCY TRANSACTION REPORTS
Section 402(b), (c) of Pub. L. 103-325 provided that:
''(b) Report Reduction Goal; Reports. -
''(1) In general. - In implementing the amendment made by
subsection (a) (amending this section), the Secretary of the
Treasury shall seek to reduce, within a reasonable period of
time, the number of reports required to be filed in the aggregate
by depository institutions pursuant to section 5313(a) of title
31, United States Code, by at least 30 percent of the number
filed during the year preceding the date of enactment of this Act
(Sept. 23, 1994).
''(2) Interim report. - The Secretary of the Treasury shall
submit a report to the Congress not later than the end of the
180-day period beginning on the date of enactment of this Act on
the progress made by the Secretary in implementing the amendment
made by subsection (a).
''(3) Annual report. - The Secretary of the Treasury shall
submit an annual report to the Congress after the end of each of
the first 5 calendar years which begin after the date of
enactment of this Act on the extent to which the Secretary has
reduced the overall number of currency transaction reports filed
with the Secretary pursuant to section 5313(a) of title 31,
United States Code, consistent with the purposes of such section
and effective law enforcement.
''(c) Streamlined Currency Transaction Reports. - The Secretary
of the Treasury shall take such action as may be appropriate to -
''(1) redesign the format of reports required to be filed under
section 5313(a) of title 31, United States Code, by any financial
institution (as defined in section 5312(a)(2) of such title) to
eliminate the need to report information which has little or no
value for law enforcement purposes; and
''(2) reduce the time and effort required to prepare such
report for filing by any such financial institution under such
section.''
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 5312, 5317, 5324, 5330,
5331 of this title; title 12 section 3420; title 26 section 6103;
title 28 section 524.
-CITE-
31 USC Sec. 5315 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5315. Reports on foreign currency transactions
-STATUTE-
(a) Congress finds that -
(1) moving mobile capital can have a significant impact on the
proper functioning of the international monetary system;
(2) it is important to have the most feasible current and
complete information on the kind and source of capital flows,
including transactions by large United States businesses and
their foreign affiliates; and
(3) additional authority should be provided to collect
information on capital flows under section 5(b) of the Trading
With the Enemy Act (50 App. U.S.C. 5(b)) and section 8 of the
Bretton Woods Agreement Act (22 U.S.C. 286f).
(b) In this section, ''United States person'' and ''foreign
person controlled by a United States person'' have the same
meanings given those terms in section 7(f)(2)(A) and (C),
respectively, of the Securities and Exchange Act of 1934 (15 U.S.C.
78g(f)(2)(A), (C)).
(c) The Secretary of the Treasury shall prescribe regulations
consistent with subsection (a) of this section requiring reports on
foreign currency transactions conducted by a United States person
or a foreign person controlled by a United States person. The
regulations shall require that a report contain information and be
submitted at the time and in the way, with reasonable exceptions
and classifications, necessary to carry out this section.
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 997.)
-MISC1-
Historical and Revision Notes
---------------------------------------------------------------------
Revised Section Source (U.S. Code) Source (Statutes at
Large)
---------------------------------------------------------------------
5315(a) 31:1141. Sept. 21, 1973, Pub.
L. 93-110, Sec.
201, 202, 87 Stat.
353.
5315(b), (c) 31:1142.
-------------------------------
In subsection (a)(3), the words ''it is desirable to emphasize
this objective . . . existing legal'' are omitted as unnecessary.
In subsection (c), the words ''(hereafter referred to as the
'Secretary')'' are omitted because of the restatement. The words
''under the authority of this subchapter and any other authority
conferred by law'' are omitted as surplus. The word ''prescribe''
is substituted for ''supplement'' for clarity. The words ''the
statement of findings under'' and ''the submission of'' are omitted
as surplus. The words ''Reports required under this subchapter
shall cover foreign currency transactions'' are omitted because of
the restatement. The words ''such terms are'' and ''the policy
of'' are omitted as surplus.
-REFTEXT-
REFERENCES IN TEXT
Section 5(b) of the Trading With the Enemy Act, referred to in
subsec. (a)(3), is also classified to section 95a of Title 12,
Banks and Banking.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 5311, 5313, 5318, 5321,
5322 of this title.
-CITE-
31 USC Sec. 5318 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5318. Compliance, exemptions, and summons authority
-STATUTE-
(a) General Powers of Secretary. - The Secretary of the Treasury
may (except under section 5315 of this title and regulations
prescribed under section 5315) -
(1) except as provided in subsection (b)(2), delegate duties
and powers under this subchapter to an appropriate supervising
agency and the United States Postal Service;
(2) require a class of domestic financial institutions or
nonfinancial trades or businesses to maintain appropriate
procedures to ensure compliance with this subchapter and
regulations prescribed under this subchapter or to guard against
money laundering;
(3) examine any books, papers, records, or other data of
domestic financial institutions or nonfinancial trades or
businesses relevant to the recordkeeping or reporting
requirements of this subchapter;
(4) summon a financial institution or nonfinancial trade or
business, an officer or employee of a financial institution or
nonfinancial trade or business (including a former officer or
employee), or any person having possession, custody, or care of
the reports and records required under this subchapter, to appear
before the Secretary of the Treasury or his delegate at a time
and place named in the summons and to produce such books, papers,
records, or other data, and to give testimony, under oath, as may
be relevant or material to an investigation described in
subsection (b);
(5) exempt from the requirements of this subchapter any class
of transactions within any State if the Secretary determines that
-
(A) under the laws of such State, that class of transactions
is subject to requirements substantially similar to those
imposed under this subchapter; and
(B) there is adequate provision for the enforcement of such
requirements; and
(6) prescribe an appropriate exemption from a requirement under
this subchapter and regulations prescribed under this
subchapter. The Secretary may revoke an exemption under this
paragraph or paragraph (5) by actually or constructively
notifying the parties affected. A revocation is effective during
judicial review.
(b) Limitations on Summons Power. -
(1) Scope of power. - The Secretary of the Treasury may take
any action described in paragraph (3) or (4) of subsection (a)
only in connection with investigations for the purpose of civil
enforcement of violations of this subchapter, section 21 of the
Federal Deposit Insurance Act, section 411 (FOOTNOTE 1) of the
National Housing Act, or chapter 2 of Public Law 91-508 (12
U.S.C. 1951 et seq.) or any regulation under any such provision.
(FOOTNOTE 1) See References in Text note below.
(2) Authority to issue. - A summons may be issued under
subsection (a)(4) only by, or with the approval of, the Secretary
of the Treasury or a supervisory level delegate of the Secretary
of the Treasury.
(c) Administrative Aspects of Summons. -
(1) Production at designated site. - A summons issued pursuant
to this section may require that books, papers, records, or other
data stored or maintained at any place be produced at any
designated location in any State or in any territory or other
place subject to the jurisdiction of the United States not more
than 500 miles distant from any place where the financial
institution or nonfinancial trade or business operates or
conducts business in the United States.
(2) Fees and travel expenses. - Persons summoned under this
section shall be paid the same fees and mileage for travel in the
United States that are paid witnesses in the courts of the United
States.
(3) No liability for expenses. - The United States shall not be
liable for any expense, other than an expense described in
paragraph (2), incurred in connection with the production of
books, papers, records, or other data under this section.
(d) Service of Summons. - Service of a summons issued under this
section may be by registered mail or in such other manner
calculated to give actual notice as the Secretary may prescribe by
regulation.
(e) Contumacy or Refusal. -
(1) Referral to attorney general. - In case of contumacy by a
person issued a summons under paragraph (3) or (4) of subsection
(a) or a refusal by such person to obey such summons, the
Secretary of the Treasury shall refer the matter to the Attorney
General.
(2) Jurisdiction of court. - The Attorney General may invoke
the aid of any court of the United States within the jurisdiction
of which -
(A) the investigation which gave rise to the summons is being
or has been carried on;
(B) the person summoned is an inhabitant; or
(C) the person summoned carries on business or may be found,
to compel compliance with the summons.
(3) Court order. - The court may issue an order requiring the
person summoned to appear before the Secretary or his delegate to
produce books, papers, records, and other data, to give testimony
as may be necessary to explain how such material was compiled and
maintained, and to pay the costs of the proceeding.
(4) Failure to comply with order. - Any failure to obey the
order of the court may be punished by the court as a contempt
thereof.
(5) Service of process. - All process in any case under this
subsection may be served in any judicial district in which such
person may be found.
(f) Written and Signed Statement Required. - No person shall
qualify for an exemption under subsection (a)(5) (FOOTNOTE 2)
unless the relevant financial institution or nonfinancial trade or
business prepares and maintains a statement which -
(FOOTNOTE 2) See References in Text note below.
(1) describes in detail the reasons why such person is
qualified for such exemption; and
(2) contains the signature of such person.
(g) Reporting of Suspicious Transactions. -
(1) In general. - The Secretary may require any financial
institution, and any director, officer, employee, or agent of any
financial institution, to report any suspicious transaction
relevant to a possible violation of law or regulation.
(2) Notification prohibited. -
(A) In general. - If a financial institution or any director,
officer, employee, or agent of any financial institution,
voluntarily or pursuant to this section or any other authority,
reports a suspicious transaction to a government agency -
(i) the financial institution, director, officer, employee,
or agent may not notify any person involved in the
transaction that the transaction has been reported; and
(ii) no officer or employee of the Federal Government or of
any State, local, tribal, or territorial government within
the United States, who has any knowledge that such report was
made may disclose to any person involved in the transaction
that the transaction has been reported, other than as
necessary to fulfill the official duties of such officer or
employee.
(B) Disclosures in certain employment references. -
(i) Rule of construction. - Notwithstanding the application
of subparagraph (A) in any other context, subparagraph (A)
shall not be construed as prohibiting any financial
institution, or any director, officer, employee, or agent of
such institution, from including information that was
included in a report to which subparagraph (A) applies -
(I) in a written employment reference that is provided in
accordance with section 18(w) of the Federal Deposit
Insurance Act in response to a request from another
financial institution; or
(II) in a written termination notice or employment
reference that is provided in accordance with the rules of
a self-regulatory organization registered with the
Securities and Exchange Commission or the Commodity Futures
Trading Commission,
except that such written reference or notice may not disclose
that such information was also included in any such report,
or that such report was made.
(ii) Information not required. - Clause (i) shall not be
construed, by itself, to create any affirmative duty to
include any information described in clause (i) in any
employment reference or termination notice referred to in
clause (i).
(3) Liability for disclosures. -
(A) In general. - Any financial institution that makes a
voluntary disclosure of any possible violation of law or
regulation to a government agency or makes a disclosure
pursuant to this subsection or any other authority, and any
director, officer, employee, or agent of such institution who
makes, or requires another to make any such disclosure, shall
not be liable to any person under any law or regulation of the
United States, any constitution, law, or regulation of any
State or political subdivision of any State, or under any
contract or other legally enforceable agreement (including any
arbitration agreement), for such disclosure or for any failure
to provide notice of such disclosure to the person who is the
subject of such disclosure or any other person identified in
the disclosure.
(B) Rule of construction. - Subparagraph (A) shall not be
construed as creating -
(i) any inference that the term ''person'', as used in such
subparagraph, may be construed more broadly than its ordinary
usage so as to include any government or agency of
government; or
(ii) any immunity against, or otherwise affecting, any
civil or criminal action brought by any government or agency
of government to enforce any constitution, law, or regulation
of such government or agency.
(4) Single designee for reporting suspicious transactions. -
(A) In general. - In requiring reports under paragraph (1) of
suspicious transactions, the Secretary of the Treasury shall
designate, to the extent practicable and appropriate, a single
officer or agency of the United States to whom such reports
shall be made.
(B) Duty of designee. - The officer or agency of the United
States designated by the Secretary of the Treasury pursuant to
subparagraph (A) shall refer any report of a suspicious
transaction to any appropriate law enforcement, supervisory
agency, or United States intelligence agency for use in the
conduct of intelligence or counterintelligence activities,
including analysis, to protect against international terrorism.
(C) Coordination with other reporting requirements. -
Subparagraph (A) shall not be construed as precluding any
supervisory agency for any financial institution from requiring
the financial institution to submit any information or report
to the agency or another agency pursuant to any other
applicable provision of law.
(h) Anti-Money Laundering Programs. -
(1) In general. - In order to guard against money laundering
through financial institutions, each financial institution shall
establish anti-money laundering programs, including, at a minimum
-
(A) the development of internal policies, procedures, and
controls;
(B) the designation of a compliance officer;
(C) an ongoing employee training program; and
(D) an independent audit function to test programs.
(2) Regulations. - The Secretary of the Treasury, after
consultation with the appropriate Federal functional regulator
(as defined in section 509 of the Gramm-Leach-Bliley Act), may
prescribe minimum standards for programs established under
paragraph (1), and may exempt from the application of those
standards any financial institution that is not subject to the
provisions of the rules contained in part 103 of title 31, of the
Code of Federal Regulations, or any successor rule thereto, for
so long as such financial institution is not subject to the
provisions of such rules.
(3) Concentration accounts. - The Secretary may prescribe
regulations under this subsection that govern maintenance of
concentration accounts by financial institutions, in order to
ensure that such accounts are not used to prevent association of
the identity of an individual customer with the movement of funds
of which the customer is the direct or beneficial owner, which
regulations shall, at a minimum -
(A) prohibit financial institutions from allowing clients to
direct transactions that move their funds into, out of, or
through the concentration accounts of the financial
institution;
(B) prohibit financial institutions and their employees from
informing customers of the existence of, or the means of
identifying, the concentration accounts of the institution; and
(C) require each financial institution to establish written
procedures governing the documentation of all transactions
involving a concentration account, which procedures shall
ensure that, any time a transaction involving a concentration
account commingles funds belonging to 1 or more customers, the
identity of, and specific amount belonging to, each customer is
documented.
(i) Due Diligence for United States Private Banking and
Correspondent Bank Accounts Involving Foreign Persons. -
(1) In general. - Each financial institution that establishes,
maintains, administers, or manages a private banking account or a
correspondent account in the United States for a non-United
States person, including a foreign individual visiting the United
States, or a representative of a non-United States person shall
establish appropriate, specific, and, where necessary, enhanced,
due diligence policies, procedures, and controls that are
reasonably designed to detect and report instances of money
laundering through those accounts.
(2) Additional standards for certain correspondent accounts. -
(A) In general. - Subparagraph (B) shall apply if a
correspondent account is requested or maintained by, or on
behalf of, a foreign bank operating -
(i) under an offshore banking license; or
(ii) under a banking license issued by a foreign country
that has been designated -
(I) as noncooperative with international anti-money
laundering principles or procedures by an intergovernmental
group or organization of which the United States is a
member, with which designation the United States
representative to the group or organization concurs; or
(II) by the Secretary of the Treasury as warranting
special measures due to money laundering concerns.
(B) Policies, procedures, and controls. - The enhanced due
diligence policies, procedures, and controls required under
paragraph (1) shall, at a minimum, ensure that the financial
institution in the United States takes reasonable steps -
(i) to ascertain for any such foreign bank, the shares of
which are not publicly traded, the identity of each of the
owners of the foreign bank, and the nature and extent of the
ownership interest of each such owner;
(ii) to conduct enhanced scrutiny of such account to guard
against money laundering and report any suspicious
transactions under subsection (g); and
(iii) to ascertain whether such foreign bank provides
correspondent accounts to other foreign banks and, if so, the
identity of those foreign banks and related due diligence
information, as appropriate under paragraph (1).
(3) Minimum standards for private banking accounts. - If a
private banking account is requested or maintained by, or on
behalf of, a non-United States person, then the due diligence
policies, procedures, and controls required under paragraph (1)
shall, at a minimum, ensure that the financial institution takes
reasonable steps -
(A) to ascertain the identity of the nominal and beneficial
owners of, and the source of funds deposited into, such account
as needed to guard against money laundering and report any
suspicious transactions under subsection (g); and
(B) to conduct enhanced scrutiny of any such account that is
requested or maintained by, or on behalf of, a senior foreign
political figure, or any immediate family member or close
associate of a senior foreign political figure that is
reasonably designed to detect and report transactions that may
involve the proceeds of foreign corruption.
(4) Definition. - For purposes of this subsection, the
following definitions shall apply:
(A) Offshore banking license. - The term ''offshore banking
license'' means a license to conduct banking activities which,
as a condition of the license, prohibits the licensed entity
from conducting banking activities with the citizens of, or
with the local currency of, the country which issued the
license.
(B) Private banking account. - The term ''private banking
account'' means an account (or any combination of accounts)
that -
(i) requires a minimum aggregate deposits of funds or other
assets of not less than $1,000,000;
(ii) is established on behalf of 1 or more individuals who
have a direct or beneficial ownership interest in the
account; and
(iii) is assigned to, or is administered or managed by, in
whole or in part, an officer, employee, or agent of a
financial institution acting as a liaison between the
financial institution and the direct or beneficial owner of
the account.
(j) Prohibition on United States Correspondent Accounts With
Foreign Shell Banks. -
(1) In general. - A financial institution described in
subparagraphs (A) through (G) of section 5312(a)(2) (in this
subsection referred to as a ''covered financial institution'')
shall not establish, maintain, administer, or manage a
correspondent account in the United States for, or on behalf of,
a foreign bank that does not have a physical presence in any
country.
(2) Prevention of indirect service to foreign shell banks. - A
covered financial institution shall take reasonable steps to
ensure that any correspondent account established, maintained,
administered, or managed by that covered financial institution in
the United States for a foreign bank is not being used by that
foreign bank to indirectly provide banking services to another
foreign bank that does not have a physical presence in any
country. The Secretary of the Treasury shall, by regulation,
delineate the reasonable steps necessary to comply with this
paragraph.
(3) Exception. - Paragraphs (1) and (2) do not prohibit a
covered financial institution from providing a correspondent
account to a foreign bank, if the foreign bank -
(A) is an affiliate of a depository institution, credit
union, or foreign bank that maintains a physical presence in
the United States or a foreign country, as applicable; and
(B) is subject to supervision by a banking authority in the
country regulating the affiliated depository institution,
credit union, or foreign bank described in subparagraph (A), as
applicable.
(4) Definitions. - For purposes of this subsection -
(A) the term ''affiliate'' means a foreign bank that is
controlled by or is under common control with a depository
institution, credit union, or foreign bank; and
(B) the term ''physical presence'' means a place of business
that -
(i) is maintained by a foreign bank;
(ii) is located at a fixed address (other than solely an
electronic address) in a country in which the foreign bank is
authorized to conduct banking activities, at which location
the foreign bank -
(I) employs 1 or more individuals on a full-time basis;
and
(II) maintains operating records related to its banking
activities; and
(iii) is subject to inspection by the banking authority
which licensed the foreign bank to conduct banking
activities.
(k) Bank Records Related to Anti-Money Laundering Programs. -
(1) Definitions. - For purposes of this subsection, the
following definitions shall apply:
(A) Appropriate federal banking agency. - The term
''appropriate Federal banking agency'' has the same meaning as
in section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813).
(B) Incorporated term. - The term ''correspondent account''
has the same meaning as in section 5318A(f)(1)(B).
(2) 120-hour rule. - Not later than 120 hours after receiving a
request by an appropriate Federal banking agency for information
related to anti-money laundering compliance by a covered
financial institution or a customer of such institution, a
covered financial institution shall provide to the appropriate
Federal banking agency, or make available at a location specified
by the representative of the appropriate Federal banking agency,
information and account documentation for any account opened,
maintained, administered or managed in the United States by the
covered financial institution.
(3) Foreign bank records. -
(A) Summons or subpoena of records. -
(i) In general. - The Secretary of the Treasury or the
Attorney General may issue a summons or subpoena to any
foreign bank that maintains a correspondent account in the
United States and request records related to such
correspondent account, including records maintained outside
of the United States relating to the deposit of funds into
the foreign bank.
(ii) Service of summons or subpoena. - A summons or
subpoena referred to in clause (i) may be served on the
foreign bank in the United States if the foreign bank has a
representative in the United States, or in a foreign country
pursuant to any mutual legal assistance treaty, multilateral
agreement, or other request for international law enforcement
assistance.
(B) Acceptance of service. -
(i) Maintaining records in the united states. - Any covered
financial institution which maintains a correspondent account
in the United States for a foreign bank shall maintain
records in the United States identifying the owners of such
foreign bank and the name and address of a person who resides
in the United States and is authorized to accept service of
legal process for records regarding the correspondent
account.
(ii) Law enforcement request. - Upon receipt of a written
request from a Federal law enforcement officer for
information required to be maintained under this paragraph,
the covered financial institution shall provide the
information to the requesting officer not later than 7 days
after receipt of the request.
(C) Termination of correspondent relationship. -
(i) Termination upon receipt of notice. - A covered
financial institution shall terminate any correspondent
relationship with a foreign bank not later than 10 business
days after receipt of written notice from the Secretary or
the Attorney General (in each case, after consultation with
the other) that the foreign bank has failed -
(I) to comply with a summons or subpoena issued under
subparagraph (A); or
(II) to initiate proceedings in a United States court
contesting such summons or subpoena.
(ii) Limitation on liability. - A covered financial
institution shall not be liable to any person in any court or
arbitration proceeding for terminating a correspondent
relationship in accordance with this subsection.
(iii) Failure to terminate relationship. - Failure to
terminate a correspondent relationship in accordance with
this subsection shall render the covered financial
institution liable for a civil penalty of up to $10,000 per
day until the correspondent relationship is so terminated.
(l) (FOOTNOTE 3) Identification and Verification of
Accountholders. -
(FOOTNOTE 3) So in original. Two subsecs. (l) have been
enacted.
(1) In general. - Subject to the requirements of this
subsection, the Secretary of the Treasury shall prescribe
regulations setting forth the minimum standards for financial
institutions and their customers regarding the identity of the
customer that shall apply in connection with the opening of an
account at a financial institution.
(2) Minimum requirements. - The regulations shall, at a
minimum, require financial institutions to implement, and
customers (after being given adequate notice) to comply with,
reasonable procedures for -
(A) verifying the identity of any person seeking to open an
account to the extent reasonable and practicable;
(B) maintaining records of the information used to verify a
person's identity, including name, address, and other
identifying information; and
(C) consulting lists of known or suspected terrorists or
terrorist organizations provided to the financial institution
by any government agency to determine whether a person seeking
to open an account appears on any such list.
(3) Factors to be considered. - In prescribing regulations
under this subsection, the Secretary shall take into
consideration the various types of accounts maintained by various
types of financial institutions, the various methods of opening
accounts, and the various types of identifying information
available.
(4) Certain financial institutions. - In the case of any
financial institution the business of which is engaging in
financial activities described in section 4(k) of the Bank
Holding Company Act of 1956 (including financial activities
subject to the jurisdiction of the Commodity Futures Trading
Commission), the regulations prescribed by the Secretary under
paragraph (1) shall be prescribed jointly with each Federal
functional regulator (as defined in section 509 of the
Gramm-Leach-Bliley Act, including the Commodity Futures Trading
Commission) appropriate for such financial institution.
(5) Exemptions. - The Secretary (and, in the case of any
financial institution described in paragraph (4), any Federal
agency described in such paragraph) may, by regulation or order,
exempt any financial institution or type of account from the
requirements of any regulation prescribed under this subsection
in accordance with such standards and procedures as the Secretary
may prescribe.
(6) Effective date. - Final regulations prescribed under this
subsection shall take effect before the end of the 1-year period
beginning on the date of enactment of the International Money
Laundering Abatement and Financial Anti-Terrorism Act of 2001.
(l) (FOOTNOTE 3) Applicability of Rules. - Any rules promulgated
pursuant to the authority contained in section 21 of the Federal
Deposit Insurance Act (12 U.S.C. 1829b) shall apply, in addition to
any other financial institution to which such rules apply, to any
person that engages as a business in the transmission of funds,
including any person who engages as a business in an informal money
transfer system or any network of people who engage as a business
in facilitating the transfer of money domestically or
internationally outside of the conventional financial institutions
system.
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 999; Pub. L. 99-570,
title I, Sec. 1356(a), (b), (c)(2), Oct. 27, 1986, 100 Stat.
3207-23, 3207-24; Pub. L. 100-690, title VI, Sec. 6185(e), 6469(c),
Nov. 18, 1988, 102 Stat. 4357, 4377; Pub. L. 102-550, title XV,
Sec. 1504(d)(1), 1513, 1517(b), Oct. 28, 1992, 106 Stat. 4055,
4058, 4059; Pub. L. 103-322, title XXXIII, Sec. 330017(b)(1), Sept.
13, 1994, 108 Stat. 2149; Pub. L. 103-325, title IV, Sec. 403(a),
410, 413(b)(1), Sept. 23, 1994, 108 Stat. 2245, 2252, 2254; Pub. L.
107-56, title III, Sec. 312(a), 313(a), 319(b), 325, 326(a), 351,
352(a), 358(b), 359(c), 365(c)(2)(B), Oct. 26, 2001, 115 Stat. 304,
306, 312, 317, 320, 322, 326, 328, 335.)
-MISC1-
Historical and Revision Notes
---------------------------------------------------------------------
Revised Section Source (U.S. Code) Source (Statutes at
Large)
---------------------------------------------------------------------
5318 31:1054(a), (b)(1st Oct. 26, 1970, Pub.
sentence). L. 91-508, Sec.
205(a), (b)(1st
sentence), 206, 84
Stat. 1120.
31:1055.
-------------------------------
In the section, before clause (1), the words ''have the
responsibility to assure compliance with the requirements of this
chapter'' in 31:1054(a) are omitted as unnecessary because of
section 321 of the revised title. The words ''(except under
section 5315 of this title and regulations prescribed under section
5315)'' are added because 31:1141-1143 was not enacted as a part of
the Currency and Foreign Transactions Reporting Act that is
restated in this subchapter. In clause (1), the words ''duties and
powers'' are substituted for ''responsibilities'' for consistency
in the revised title and with other titles of the United States
Code. The words ''bank supervisory agency, or other'' are omitted
as surplus. In clause (2), the words ''by regulation'' and ''as he
may deem'' are omitted as surplus. The words ''and regulations
prescribed under this subchapter'' are added because of the
restatement. In clause (3), the word ''prescribe'' is substituted
for ''make'' in 31:1055 for consistency in the revised title and
with other titles of the Code. The words ''otherwise imposed'',
31:1055(1st sentence), and the words ''in his discretion'' are
omitted as surplus.
-REFTEXT-
REFERENCES IN TEXT
Section 21 of the Federal Deposit Insurance Act, referred to in
subsecs. (b)(1) and (l), is classified to section 1829b of Title
12, Banks and Banking.
Section 411 of the National Housing Act, referred to in subsec.
(b)(1), which was classified to section 1730d of Title 12, was
repealed by Pub. L. 101-73, title IV, Sec. 407, Aug. 9, 1989, 103
Stat. 363.
Chapter 2 of Public Law 91-508 (12 U.S.C. 1951 et seq.), referred
to in subsec. (b)(1), probably means chapter 2 (Sec. 121 to 129) of
title I of Pub. L. 91-508, Oct. 26, 1970, 84 Stat. 1116, which is
classified generally to chapter 21 (Sec. 1951 et seq.) of Title 12.
For complete classification of chapter 2 to the Code, see Tables.
Subsection (a)(5), referred to in subsec. (f), was redesignated
subsection (a)(6) by section 410(a)(2) of Pub. L. 103-325.
Section 18(w) of the Federal Deposit Insurance Act, referred to
in subsec. (g)(2)(B)(i)(I), is classified to section 1828(w) of
Title 12, Banks and Banking.
Section 509 of the Gramm-Leach-Bliley Act, referred to in
subsecs. (h)(2) and (l)(4), is classified to section 6809 of Title
15, Commerce and Trade.
Section 4(k) of the Bank Holding Company Act of 1956, referred to
in subsec. (l)(4), is classified to section 1843(k) of Title 12,
Banks and Banking.
The date of enactment of the International Money Laundering
Abatement and Financial Anti-Terrorism Act of 2001, referred to in
subsec. (l)(6), is the date of enactment of title III of Pub. L.
107-56, which was approved Oct. 26, 2001.
-COD-
CODIFICATION
Another section 365(c) of Pub. L. 107-56 amended the table of
sections at the beginning of this chapter.
-MISC3-
AMENDMENTS
2001 - Subsec. (a)(2), (3). Pub. L. 107-56, Sec.
365(c)(2)(B)(ii), inserted ''or nonfinancial trades or businesses''
after ''financial institutions''.
Subsec. (a)(4). Pub. L. 107-56, Sec. 365(c)(2)(B)(i), inserted
''or nonfinancial trade or business'' after ''financial
institution'' in two places.
Subsec. (c)(1). Pub. L. 107-56, Sec. 365(c)(2)(B)(i), inserted
''or nonfinancial trade or business'' after ''financial
institution''.
Subsec. (f). Pub. L. 107-56, Sec. 365(c)(2)(B)(i), inserted ''or
nonfinancial trade or business'' after ''financial institution'' in
introductory provisions.
Subsec. (g)(2). Pub. L. 107-56, Sec. 351(b), reenacted heading
without change and amended text generally. Prior to amendment,
text read as follows: ''A financial institution, and a director,
officer, employee, or agent of any financial institution, who
voluntarily reports a suspicious transaction, or that reports a
suspicious transaction pursuant to this section or any other
authority, may not notify any person involved in the transaction
that the transaction has been reported.''
Subsec. (g)(3). Pub. L. 107-56, Sec. 351(a), reenacted heading
without change and amended text generally. Prior to amendment,
text read as follows: ''Any financial institution that makes a
disclosure of any possible violation of law or regulation or a
disclosure pursuant to this subsection or any other authority, and
any director, officer, employee, or agent of such institution,
shall not be liable to any person under any law or regulation of
the United States or any constitution, law, or regulation of any
State or political subdivision thereof, for such disclosure or for
any failure to notify the person involved in the transaction or any
other person of such disclosure.''
Subsec. (g)(4)(B). Pub. L. 107-56, Sec. 358(b), substituted '',
supervisory agency, or United States intelligence agency for use in
the conduct of intelligence or counterintelligence activities,
including analysis, to protect against international terrorism''
for ''or supervisory agency''.
Subsec. (h). Pub. L. 107-56, Sec. 352(a), reenacted heading
without change and amended text of subsec. (h) generally. Prior to
amendment, text read as follows:
''(1) In general. - In order to guard against money laundering
through financial institutions, the Secretary may require financial
institutions to carry out anti-money laundering programs, including
at a minimum
''(A) the development of internal policies, procedures, and
controls,
''(B) the designation of a compliance officer,
''(C) an ongoing employee training program, and
''(D) an independent audit function to test programs.
''(2) Regulations. - The Secretary may prescribe minimum
standards for programs established under paragraph (1).''
Subsec. (h)(3). Pub. L. 107-56, Sec. 325, which directed
amendment of subsec. (h) of this section, ''as amended by section
202 of this title'', by adding par. (3), was executed by adding
par. (3) to subsec. (h) of this section, as amended by section 352
of title III of Pub. L. 107-56, to reflect the probable intent of
Congress.
Subsec. (i). Pub. L. 107-56, Sec. 312(a), added subsec. (i).
Subsec. (j). Pub. L. 107-56, Sec. 313(a), added subsec. (j).
Subsec. (k). Pub. L. 107-56, Sec. 319(b), added subsec. (k).
Subsec. (l). Pub. L. 107-56, Sec. 359(c), added subsec. (l)
relating to applicability of rules.
Pub. L. 107-56, Sec. 326(a), added subsec. (l) relating to
identification and verification of accountholders.
1994 - Subsec. (a)(5). Pub. L. 103-325, Sec. 410(a), added par.
(5). Former par. (5) redesignated (6).
Subsec. (a)(6). Pub. L. 103-325, Sec. 410(b), inserted ''under
this paragraph or paragraph (5)'' after ''revoke an exemption'' in
penultimate sentence.
Pub. L. 103-325, Sec. 410(a)(2), redesignated par. (5) as (6).
Subsec. (g). Pub. L. 103-322, Sec. 330017(b)(1), and Pub. L.
103-325, Sec. 413(b)(1), amended directory language of Pub. L.
102-550, Sec. 1517(b), identically. See 1992 Amendment note below.
Subsec. (g)(4). Pub. L. 103-325, Sec. 403(a), added par. (4).
Subsec. (h). Pub. L. 103-322, Sec. 330017(b)(1), and Pub. L.
103-325, Sec. 413(b)(1), amended directory language of Pub. L.
102-550, Sec. 1517(b), identically. See 1992 Amendment note below.
1992 - Subsec. (a)(1). Pub. L. 102-550, Sec. 1504(d)(1),
substituted ''supervising agency and the United States Postal
Service'' for ''supervising agency or the Postal Inspection Service
and the Postal Service''.
Subsec. (a)(2). Pub. L. 102-550, Sec. 1513, inserted before
semicolon ''or to guard against money laundering''.
Subsecs. (g), (h). Pub. L. 102-550, Sec. 1517(b), as amended by
Pub. L. 103-322, Sec. 330017(b)(1), and Pub. L. 103-325, Sec.
413(b)(1), added subsecs. (g) and (h).
1988 - Subsec. (a)(1). Pub. L. 100-690, Sec. 6469(c), inserted
''or the Postal Inspection Service'' after ''appropriate
supervising agency''.
Pub. L. 100-690, Sec. 6185(e), inserted ''and the Postal
Service'' after ''appropriate supervising agency''.
1986 - Pub. L. 99-570, Sec. 1356(c)(2), substituted ''Compliance,
exemptions, and summons authority'' for ''Compliance and
exemptions'' in section catchline.
Subsec. (a). Pub. L. 99-570, Sec. 1356(a)(1)-(5), designated
existing provisions as subsec. (a), added subsec. heading, inserted
''except as provided in subsection (b)(2),'' in par. (1), added
pars. (3) and (4), and redesignated former par. (3) as (5).
Subsecs. (b) to (e). Pub. L. 99-570, Sec. 1356(a)(6), added
subsecs. (b) to (e).
Subsec. (f). Pub. L. 99-570, Sec. 1356(b), added subsec. (f).
EFFECTIVE AND TERMINATION DATES OF 2001 AMENDMENT
Amendments by title III of Pub. L. 107-56 to terminate effective
on and after the first day of fiscal year 2005 if Congress enacts a
joint resolution that such amendments no longer have the force of
law, see section 303 of Pub. L. 107-56, set out as a Four-Year
Congressional Review; Expedited Consideration note under section
5311 of this title.
Pub. L. 107-56, title III, Sec. 312(b)(2), Oct. 26, 2001, 115
Stat. 306, provided that: ''Section 5318(i) of title 31, United
States Code, as added by this section, shall take effect 270 days
after the date of enactment of this Act (Oct. 26, 2001), whether or
not final regulations are issued under paragraph (1) (set out
below), and the failure to issue such regulations shall in no way
affect the enforceability of this section (amending this section
and enacting provisions set out as a note below) or the amendments
made by this section. Section 5318(i) of title 31, United States
Code, as added by this section, shall apply with respect to
accounts covered by that section 5318(i), that are opened before,
on, or after the date of enactment of this Act.''
Pub. L. 107-56, title III, Sec. 313(b), Oct. 26, 2001, 115 Stat.
307, provided that: ''The amendment made by subsection (a)
(amending this section) shall take effect at the end of the 60-day
period beginning on the date of enactment of this Act (Oct. 26,
2001).''
Pub. L. 107-56, title III, Sec. 352(b), Oct. 26, 2001, 115 Stat.
322, provided that: ''The amendment made by subsection (a)
(amending this section) shall take effect at the end of the 180-day
period beginning on the date of enactment of this Act (Oct. 26,
2001).''
Amendment by section 358(b) of Pub. L. 107-56 applicable with
respect to reports filed or records maintained on, before, or after
Oct. 26, 2001, see section 358(h) of Pub. L. 107-56, set out as a
note under section 1829b of Title 12, Banks and Banking.
EFFECTIVE DATE OF 1994 AMENDMENT
Section 330017(b)(1) of Pub. L. 103-322 and section 413(b)(1) of
Pub. L. 103-325 provided that the identical amendments made by
those sections are effective Oct. 28, 1992.
REGULATIONS
Pub. L. 107-56, title III, Sec. 312(b)(1), Oct. 26, 2001, 115
Stat. 305, provided that: ''Not later than 180 days after the date
of enactment of this Act (Oct. 26, 2001), the Secretary (of the
Treasury), in consultation with the appropriate Federal functional
regulators (as defined in section 509 of the Gramm-Leach-Bliley Act
(15 U.S.C. 6809)) of the affected financial institutions, shall
further delineate, by regulation, the due diligence policies,
procedures, and controls required under section 5318(i)(1) of title
31, United States Code, as added by this section.''
Pub. L. 107-56, title III, Sec. 352(c), Oct. 26, 2001, 115 Stat.
322, provided that: ''Before the end of the 180-day period
beginning on the date of enactment of this Act (Oct. 26, 2001), the
Secretary (of the Treasury) shall prescribe regulations that
consider the extent to which the requirements imposed under this
section (amending this section and enacting provisions set out as a
note above) are commensurate with the size, location, and
activities of the financial institutions to which such regulations
apply.''
GRACE PERIOD
Pub. L. 107-56, title III, Sec. 319(c), Oct. 26, 2001, 115 Stat.
314, provided that: ''Financial institutions shall have 60 days
from the date of enactment of this Act (Oct. 26, 2001) to comply
with the provisions of section 5318(k) of title 31, United States
Code, as added by this section.''
''FEDERAL FUNCTIONAL REGULATOR'' INCLUDES COMMODITY FUTURES TRADING
COMMISSION
Pub. L. 107-56, title III, Sec. 321(c), Oct. 26, 2001, 115 Stat.
315, provided that: ''For purposes of this Act (probably should be
''title'', see Short Title of 2001 Amendment note set out under
section 5301 of this title) and any amendment made by this Act to
any other provision of law, the term 'Federal functional regulator'
includes the Commodity Futures Trading Commission.''
REPORTING OF SUSPICIOUS ACTIVITIES BY SECURITIES BROKERS AND
DEALERS; INVESTMENT COMPANY STUDY
Pub. L. 107-56, title III, Sec. 356(a), (b), Oct. 26, 2001, 115
Stat. 324, provided that:
''(a) Deadline for Suspicious Activity Reporting Requirements for
Registered Brokers and Dealers. - The Secretary (of the Treasury),
after consultation with the Securities and Exchange Commission and
the Board of Governors of the Federal Reserve System, shall publish
proposed regulations in the Federal Register before January 1,
2002, requiring brokers and dealers registered with the Securities
and Exchange Commission under the Securities Exchange Act of 1934
(15 U.S.C. 78a et seq.) to submit suspicious activity reports under
section 5318(g) of title 31, United States Code. Such regulations
shall be published in final form not later than July 1, 2002.
''(b) Suspicious Activity Reporting Requirements For Futures
Commission Merchants, Commodity Trading Advisors, and Commodity
Pool Operators. - The Secretary, in consultation with the Commodity
Futures Trading Commission, may prescribe regulations requiring
futures commission merchants, commodity trading advisors, and
commodity pool operators registered under the Commodity Exchange
Act (7 U.S.C. 1 et seq.) to submit suspicious activity reports
under section 5318(g) of title 31, United States Code.''
REPORTS
Section 403(b) of Pub. L. 103-325 provided that:
''(1) Reports required. - The Secretary of the Treasury shall
submit an annual report to the Congress at the times required under
paragraph (2) on the number of suspicious transactions reported to
the officer or agency designated under section 5318(g)(4)(A) of
title 31, United States Code, during the period covered by the
report and the disposition of such reports.
''(2) Time for submitting reports. - The 1st report required
under paragraph (1) shall be filed before the end of the 1-year
period beginning on the date of enactment of the Money Laundering
Suppression Act of 1994 (Sept. 23, 1994) and each subsequent report
shall be filed within 90 days after the end of each of the 5
calendar years which begin after such date of enactment.''
DESIGNATION REQUIRED TO BE MADE EXPEDITIOUSLY
Section 403(c) of Pub. L. 103-325 provided that: ''The initial
designation of an officer or agency of the United States pursuant
to the amendment made by subsection (a) (amending this section)
shall be made before the end of the 180-day period beginning on the
date of enactment of this Act (Sept. 23, 1994).''
IMPROVEMENT OF IDENTIFICATION OF MONEY LAUNDERING SCHEMES
Section 404 of Pub. L. 103-325 provided that:
''(a) Enhanced Training, Examinations, and Referrals by Banking
Agencies. - Before the end of the 6-month period beginning on the
date of enactment of this Act (Sept. 23, 1994), each appropriate
Federal banking agency shall, in consultation with the Secretary of
the Treasury and other appropriate law enforcement agencies -
''(1) review and enhance training and examination procedures to
improve the identification of money laundering schemes involving
depository institutions; and
''(2) review and enhance procedures for referring cases to any
appropriate law enforcement agency.
''(b) Improved Reporting of Criminal Schemes by Law Enforcement
Agencies. - The Secretary of the Treasury and each appropriate law
enforcement agency shall provide, on a regular basis, information
regarding money laundering schemes and activities involving
depository institutions to each appropriate Federal banking agency
in order to enhance each agency's ability to examine for and
identify money laundering activity.
''(c) Report to Congress. - The Financial Institutions
Examination Council shall submit a report on the progress made in
carrying out subsection (a) and the usefulness of information
received pursuant to subsection (b) to the Congress by the end of
the 1-year period beginning on the date of enactment of this Act.
''(d) Definition. - For purposes of this section, the term
'appropriate Federal banking agency' has the same meaning as in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).''
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 5313, 5318A, 5321, 5322
of this title; title 18 section 981.
-CITE-
31 USC Sec. 5318A 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5318A. Special measures for jurisdictions, financial
institutions, or international transactions of primary money
laundering concern
-STATUTE-
(a) International Counter-Money Laundering Requirements. -
(1) In general. - The Secretary of the Treasury may require
domestic financial institutions and domestic financial agencies
to take 1 or more of the special measures described in subsection
(b) if the Secretary finds that reasonable grounds exist for
concluding that a jurisdiction outside of the United States, 1 or
more financial institutions operating outside of the United
States, 1 or more classes of transactions within, or involving, a
jurisdiction outside of the United States, or 1 or more types of
accounts is of primary money laundering concern, in accordance
with subsection (c).
(2) Form of requirement. - The special measures described in -
(A) subsection (b) may be imposed in such sequence or
combination as the Secretary shall determine;
(B) paragraphs (1) through (4) of subsection (b) may be
imposed by regulation, order, or otherwise as permitted by law;
and
(C) subsection (b)(5) may be imposed only by regulation.
(3) Duration of orders; rulemaking. - Any order by which a
special measure described in paragraphs (1) through (4) of
subsection (b) is imposed (other than an order described in
section 5326) -
(A) shall be issued together with a notice of proposed
rulemaking relating to the imposition of such special measure;
and
(B) may not remain in effect for more than 120 days, except
pursuant to a rule promulgated on or before the end of the
120-day period beginning on the date of issuance of such order.
(4) Process for selecting special measures. - In selecting
which special measure or measures to take under this subsection,
the Secretary of the Treasury -
(A) shall consult with the Chairman of the Board of Governors
of the Federal Reserve System, any other appropriate Federal
banking agency, as defined in section 3 of the Federal Deposit
Insurance Act, the Secretary of State, the Securities and
Exchange Commission, the Commodity Futures Trading Commission,
the National Credit Union Administration Board, and in the sole
discretion of the Secretary, such other agencies and interested
parties as the Secretary may find to be appropriate; and
(B) shall consider -
(i) whether similar action has been or is being taken by
other nations or multilateral groups;
(ii) whether the imposition of any particular special
measure would create a significant competitive disadvantage,
including any undue cost or burden associated with
compliance, for financial institutions organized or licensed
in the United States;
(iii) the extent to which the action or the timing of the
action would have a significant adverse systemic impact on
the international payment, clearance, and settlement system,
or on legitimate business activities involving the particular
jurisdiction, institution, or class of transactions; and
(iv) the effect of the action on United States national
security and foreign policy.
(5) No limitation on other authority. - This section shall not
be construed as superseding or otherwise restricting any other
authority granted to the Secretary, or to any other agency, by
this subchapter or otherwise.
(b) Special Measures. - The special measures referred to in
subsection (a), with respect to a jurisdiction outside of the
United States, financial institution operating outside of the
United States, class of transaction within, or involving, a
jurisdiction outside of the United States, or 1 or more types of
accounts are as follows:
(1) Recordkeeping and reporting of certain financial
transactions. -
(A) In general. - The Secretary of the Treasury may require
any domestic financial institution or domestic financial agency
to maintain records, file reports, or both, concerning the
aggregate amount of transactions, or concerning each
transaction, with respect to a jurisdiction outside of the
United States, 1 or more financial institutions operating
outside of the United States, 1 or more classes of transactions
within, or involving, a jurisdiction outside of the United
States, or 1 or more types of accounts if the Secretary finds
any such jurisdiction, institution, or class of transactions to
be of primary money laundering concern.
(B) Form of records and reports. - Such records and reports
shall be made and retained at such time, in such manner, and
for such period of time, as the Secretary shall determine, and
shall include such information as the Secretary may determine,
including -
(i) the identity and address of the participants in a
transaction or relationship, including the identity of the
originator of any funds transfer;
(ii) the legal capacity in which a participant in any
transaction is acting;
(iii) the identity of the beneficial owner of the funds
involved in any transaction, in accordance with such
procedures as the Secretary determines to be reasonable and
practicable to obtain and retain the information; and
(iv) a description of any transaction.
(2) Information relating to beneficial ownership. - In addition
to any other requirement under any other provision of law, the
Secretary may require any domestic financial institution or
domestic financial agency to take such steps as the Secretary may
determine to be reasonable and practicable to obtain and retain
information concerning the beneficial ownership of any account
opened or maintained in the United States by a foreign person
(other than a foreign entity whose shares are subject to public
reporting requirements or are listed and traded on a regulated
exchange or trading market), or a representative of such a
foreign person, that involves a jurisdiction outside of the
United States, 1 or more financial institutions operating outside
of the United States, 1 or more classes of transactions within,
or involving, a jurisdiction outside of the United States, or 1
or more types of accounts if the Secretary finds any such
jurisdiction, institution, or transaction or type of account to
be of primary money laundering concern.
(3) Information relating to certain payable-through accounts. -
If the Secretary finds a jurisdiction outside of the United
States, 1 or more financial institutions operating outside of the
United States, or 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States to be of
primary money laundering concern, the Secretary may require any
domestic financial institution or domestic financial agency that
opens or maintains a payable-through account in the United States
for a foreign financial institution involving any such
jurisdiction or any such financial institution operating outside
of the United States, or a payable through account through which
any such transaction may be conducted, as a condition of opening
or maintaining such account -
(A) to identify each customer (and representative of such
customer) of such financial institution who is permitted to
use, or whose transactions are routed through, such
payable-through account; and
(B) to obtain, with respect to each such customer (and each
such representative), information that is substantially
comparable to that which the depository institution obtains in
the ordinary course of business with respect to its customers
residing in the United States.
(4) Information relating to certain correspondent accounts. -
If the Secretary finds a jurisdiction outside of the United
States, 1 or more financial institutions operating outside of the
United States, or 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States to be of
primary money laundering concern, the Secretary may require any
domestic financial institution or domestic financial agency that
opens or maintains a correspondent account in the United States
for a foreign financial institution involving any such
jurisdiction or any such financial institution operating outside
of the United States, or a correspondent account through which
any such transaction may be conducted, as a condition of opening
or maintaining such account -
(A) to identify each customer (and representative of such
customer) of any such financial institution who is permitted to
use, or whose transactions are routed through, such
correspondent account; and
(B) to obtain, with respect to each such customer (and each
such representative), information that is substantially
comparable to that which the depository institution obtains in
the ordinary course of business with respect to its customers
residing in the United States.
(5) Prohibitions or conditions on opening or maintaining
certain correspondent or payable-through accounts. - If the
Secretary finds a jurisdiction outside of the United States, 1 or
more financial institutions operating outside of the United
States, or 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States to be of
primary money laundering concern, the Secretary, in consultation
with the Secretary of State, the Attorney General, and the
Chairman of the Board of Governors of the Federal Reserve System,
may prohibit, or impose conditions upon, the opening or
maintaining in the United States of a correspondent account or
payable-through account by any domestic financial institution or
domestic financial agency for or on behalf of a foreign banking
institution, if such correspondent account or payable-through
account involves any such jurisdiction or institution, or if any
such transaction may be conducted through such correspondent
account or payable-through account.
(c) Consultations and Information To Be Considered in Finding
Jurisdictions, Institutions, Types of Accounts, or Transactions To
Be of Primary Money Laundering Concern. -
(1) In general. - In making a finding that reasonable grounds
exist for concluding that a jurisdiction outside of the United
States, 1 or more financial institutions operating outside of the
United States, 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States, or 1 or
more types of accounts is of primary money laundering concern so
as to authorize the Secretary of the Treasury to take 1 or more
of the special measures described in subsection (b), the
Secretary shall consult with the Secretary of State and the
Attorney General.
(2) Additional considerations. - In making a finding described
in paragraph (1), the Secretary shall consider in addition such
information as the Secretary determines to be relevant, including
the following potentially relevant factors:
(A) Jurisdictional factors. - In the case of a particular
jurisdiction -
(i) evidence that organized criminal groups, international
terrorists, or both, have transacted business in that
jurisdiction;
(ii) the extent to which that jurisdiction or financial
institutions operating in that jurisdiction offer bank
secrecy or special regulatory advantages to nonresidents or
nondomiciliaries of that jurisdiction;
(iii) the substance and quality of administration of the
bank supervisory and counter-money laundering laws of that
jurisdiction;
(iv) the relationship between the volume of financial
transactions occurring in that jurisdiction and the size of
the economy of the jurisdiction;
(v) the extent to which that jurisdiction is characterized
as an offshore banking or secrecy haven by credible
international organizations or multilateral expert groups;
(vi) whether the United States has a mutual legal
assistance treaty with that jurisdiction, and the experience
of United States law enforcement officials and regulatory
officials in obtaining information about transactions
originating in or routed through or to such jurisdiction; and
(vii) the extent to which that jurisdiction is
characterized by high levels of official or institutional
corruption.
(B) Institutional factors. - In the case of a decision to
apply 1 or more of the special measures described in subsection
(b) only to a financial institution or institutions, or to a
transaction or class of transactions, or to a type of account,
or to all 3, within or involving a particular jurisdiction -
(i) the extent to which such financial institutions,
transactions, or types of accounts are used to facilitate or
promote money laundering in or through the jurisdiction;
(ii) the extent to which such institutions, transactions,
or types of accounts are used for legitimate business
purposes in the jurisdiction; and
(iii) the extent to which such action is sufficient to
ensure, with respect to transactions involving the
jurisdiction and institutions operating in the jurisdiction,
that the purposes of this subchapter continue to be
fulfilled, and to guard against international money
laundering and other financial crimes.
(d) Notification of Special Measures Invoked by the Secretary. -
Not later than 10 days after the date of any action taken by the
Secretary of the Treasury under subsection (a)(1), the Secretary
shall notify, in writing, the Committee on Financial Services of
the House of Representatives and the Committee on Banking, Housing,
and Urban Affairs of the Senate of any such action.
(e) Definitions. - Notwithstanding any other provision of this
subchapter, for purposes of this section and subsections (i) and
(j) of section 5318, the following definitions shall apply:
(1) Bank definitions. - The following definitions shall apply
with respect to a bank:
(A) Account. - The term ''account'' -
(i) means a formal banking or business relationship
established to provide regular services, dealings, and other
financial transactions; and
(ii) includes a demand deposit, savings deposit, or other
transaction or asset account and a credit account or other
extension of credit.
(B) Correspondent account. - The term ''correspondent
account'' means an account established to receive deposits
from, make payments on behalf of a foreign financial
institution, or handle other financial transactions related to
such institution.
(C) Payable-through account. - The term ''payable-through
account'' means an account, including a transaction account (as
defined in section 19(b)(1)(C) of the Federal Reserve Act),
opened at a depository institution by a foreign financial
institution by means of which the foreign financial institution
permits its customers to engage, either directly or through a
subaccount, in banking activities usual in connection with the
business of banking in the United States.
(2) Definitions applicable to institutions other than banks. -
With respect to any financial institution other than a bank, the
Secretary shall, after consultation with the appropriate Federal
functional regulators (as defined in section 509 of the
Gramm-Leach-Bliley Act), define by regulation the term
''account'', and shall include within the meaning of that term,
to the extent, if any, that the Secretary deems appropriate,
arrangements similar to payable-through and correspondent
accounts.
(3) Regulatory definition of beneficial ownership. - The
Secretary shall promulgate regulations defining beneficial
ownership of an account for purposes of this section and
subsections (i) and (j) of section 5318. Such regulations shall
address issues related to an individual's authority to fund,
direct, or manage the account (including, without limitation, the
power to direct payments into or out of the account), and an
individual's material interest in the income or corpus of the
account, and shall ensure that the identification of individuals
under this section does not extend to any individual whose
beneficial interest in the income or corpus of the account is
immaterial.
(4) Other terms. - The Secretary may, by regulation, further
define the terms in paragraphs (1), (2), and (3), and define
other terms for the purposes of this section, as the Secretary
deems appropriate.
-SOURCE-
(Added Pub. L. 107-56, title III, Sec. 311(a), Oct. 26, 2001, 115
Stat. 298.)
-REFTEXT-
REFERENCES IN TEXT
Section 3 of the Federal Deposit Insurance Act, referred to in
subsec. (a)(4)(A), is classified to section 1813 of Title 12, Banks
and Banking.
Section 19(b)(1)(C) of the Federal Reserve Act, referred to in
subsec. (e)(1)(C), is classified to section 461(b)(1)(C) of Title
12, Banks and Banking.
Section 509 of the Gramm-Leach-Bliley Act, referred to in subsec.
(e)(2), is classified to section 6809 of Title 15, Commerce and
Trade.
-MISC2-
TERMINATION DATE
Amendments by title III of Pub. L. 107-56 to terminate effective
on and after the first day of fiscal year 2005 if Congress enacts a
joint resolution that such amendments no longer have the force of
law, see section 303 of Pub. L. 107-56, set out as a Four-Year
Congressional Review; Expedited Consideration note under section
5311 of this title.
''FEDERAL FUNCTIONAL REGULATOR'' INCLUDES COMMODITY FUTURES TRADING
COMMISSION
For purposes of Pub. L. 107-56 and any amendment by Pub. L.
107-56, the term ''Federal functional regulator'' includes the
Commodity Futures Trading Commission, see section 321(c) of Pub. L.
107-56, set out as a note under section 5318 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 5318, 5321, 5322 of this
title.
-CITE-
31 USC Sec. 5321 01/22/02
-EXPCITE-
TITLE 31 - MONEY AND FINANCE
SUBTITLE IV - MONEY
CHAPTER 53 - MONETARY TRANSACTIONS
SUBCHAPTER II - RECORDS AND REPORTS ON MONETARY INSTRUMENTS
TRANSACTIONS
-HEAD-
Sec. 5321. Civil penalties
-STATUTE-
(a)(1) A domestic financial institution or nonfinancial trade or
business, and a partner, director, officer, or employee of a
domestic financial institution or nonfinancial trade or business,
willfully violating this subchapter or a regulation prescribed or
order issued under this subchapter (except sections 5314 and 5315
of this title or a regulation prescribed under sections 5314 and
5315), or willfully violating a regulation prescribed under section
21 of the Federal Deposit Insurance Act or section 123 of Public
Law 91-508, is liable to the United States Government for a civil
penalty of not more than the greater of the amount (not to exceed
$100,000) involved in the transaction (if any) or $25,000. For a
violation of section 5318(a)(2) of this title or a regulation
prescribed under section 5318(a)(2), a separate violation occurs
for each day the violation continues and at each office, branch, or
place of business at which a violation occurs or continues.
(2) The Secretary of the Treasury may impose an additional civil
penalty on a person not filing a report, or filing a report
containing a material omission or misstatement, under section 5316
of this title or a regulation prescribed under section 5316. A
civil penalty under this paragraph may not be more than the amount
of the monetary instrument for which the report was required. A
civil penalty under this paragraph is reduced by an amount
forfeited under section 5317(b) of this title.
(3) A person not filing a report under a regulation prescribed
under section 5315 of this title or not complying with an
injunction under section 5320 of this title enjoining a violation
of, or enforcing compliance with, section 5315 or a regulation
prescribed under section 5315, is liable to the Government for a
civil penalty of not more than $10,000.
(4) Structured Transaction Violation. -
(A) Penalty authorized. - The Secretary of the Treasury may
impose a civil money penalty on any person who violates any
provision of section 5324.
(B) Maximum amount limitation. - The amount of any civil money
penalty imposed under subparagraph (A) shall not exceed the
amount of the coins and currency (or such other monetary
instruments as the Secretary may prescribe) involved in the
transaction with respect to which such penalty is imposed.
(C) Coordination with forfeiture provision. - The amount of any
civil money penalty imposed by the Secretary under subparagraph
(A) shall be reduced by the amount of any forfeiture to the
United States in connection with the transaction with respect to
which such penalty is imposed.
(5) Foreign Financial Agency Transaction Violation. -
(A) Penalty authorized. - The Secretary of the Treasury may
impose a civil money penalty on any person who willfully violates
or any person willfully causing any violation of any provision of
section 5314.
(B) Maximum amount limitation. - The amount of any civil money
penalty imposed under subparagraph (A) shall not exceed -
(i) in the case of violation of such section involving a
transaction, the greater of -
(I) the amount (not to exceed $100,000) of the transaction;
or
(II) $25,000; and
(ii) in the case of violation of such section involving a
failure to report the existence of an account or any
identifying information required to be provided with respect to
such account, the greater of -
(I) an amount (not to exceed $100,000) equal to the balance
in the account at the time of the violation; or
(II) $25,000.
(6) Negligence. -
(A) In general. - The Secretary of the Treasury may impose a
civil money penalty of not more than $500 on any financial
institution or nonfinancial trade or business which negligently
violates any provision of this subchapter or any regulation
prescribed under this subchapter.
(B) Pattern of negligent activity. - If any financial
institution or nonfinancial trade or business engages in a
pattern of negligent violations of any provision of this
subchapter or any regulation prescribed under this subchapter,
the Secretary of the Treasury may, in addition to any penalty
imposed under subparagraph (A) with respect to any such
violation, impose a civil money penalty of not more than $50,000
on the financial institution or nonfinancial trade or business.
(7) Penalties for international counter money laundering
violations. - The Secretary may impose a civil money penalty in an
amount equal to not less than 2 times the amount of the
transaction, but not more than $1,000,000, on any financial
institution or agency that violates any provision of subsection (i)
or (j) of section 5318 or any special measures imposed under
section 5318A.
(b) Time Limitations for Assessments and Commencement of Civil
Actions. -
(1) Assessments. - The Secretary of the Treasury may assess a
civil penalty under subsection (a) at any time before the end of
the 6-year period beginning on the date of the transaction with
respect to which the penalty is assessed.
(2) Civil actions. - The Secretary may commence a civil action
to recover a civil penalty assessed under subsection (a) at any
time before the end of the 2-year period beginning on the later
of -
(A) the date the penalty was assessed; or
(B) the date any judgment becomes final in any criminal
action under section 5322 in connection with the same
transaction with respect to which the penalty is assessed.
(c) The Secretary may remit any part of a forfeiture under
subsection (c) or (d) (FOOTNOTE 1) of section 5317 of this title or
civil penalty under subsection (a)(2) of this section.
(FOOTNOTE 1) So in original. Section 5317 does not contain a
subsec. (d).
(d) Criminal Penalty Not Exclusive of Civil Penalty. - A civil
money penalty may be imposed under subsection (a) with respect to
any violation of this subchapter notwithstanding the fact that a
criminal penalty is imposed with respect to the same violation.
(e) Delegation of Assessment Authority to Banking Agencies. -
(1) In general. - The Secretary of the Treasury shall delegate,
in accordance with section 5318(a)(1) and subject to such terms
and conditions as the Secretary may impose in accordance with
paragraph (3), any authority of the Secretary to assess a civil
money penalty under this section on depository institutions (as
defined in section 3 of the Federal Deposit Insurance Act) to the
appropriate Federal banking agencies (as defined in such section
3).
(2) Authority of agencies. - Subject to any term or condition
imposed by the Secretary of the Treasury under paragraph (3), the
provisions of this section shall apply to an appropriate Federal
banking agency to which is delegated any authority of the
Secretary under this section in the same manner such provisions
apply to the Secretary.
(3) Terms and conditions. -
(A) In general. - The Secretary of the Treasury shall
prescribe by regulation the terms and conditions which shall
apply to any delegation under paragraph (1).
(B) Maximum dollar amount. - The terms and conditions
authorized under subparagraph (A) may include, in the
Secretary's sole discretion, a limitation on the amount of any
civil penalty which may be assessed by an appropriate Federal
banking agency pursuant to a delegation under paragraph (1).
-SOURCE-
(Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 999; Pub. L. 98-473,
title II, Sec. 901(a), Oct. 12, 1984, 98 Stat. 2135; Pub. L.
99-570, title I, Sec. 1356(c)(1), 1357(a)-(f), (h), Oct. 27, 1986,
100 Stat. 3207-24 - 3207-26; Pub. L. 100-690, title VI, Sec.
6185(g)(2), Nov. 18, 1988, 102 Stat. 4357; Pub. L. 102-550, title
XV, Sec. 1511(b), 1525(b), 1535(a)(2), 1561(a), Oct. 28, 1992, 106
Stat. 4057, 4065, 4066, 4071; Pub. L. 103-322, title XXXIII, Sec.
330017(a)(1), Sept. 13, 1994, 108 Stat. 2149; Pub. L. 103-325,
title IV, Sec. 406, 411(b), 413(a)(1), Sept. 23, 1994, 108 Stat.
2247, 2253, 2254; Pub. L. 104-208, div. A, title II, Sec. 2223(3),
Sept. 30, 1996, 110 Stat. 3009-415; Pub. L. 107-56, title III, Sec.
353(a), 363(a), 365(c)(2)(B)(i), Oct. 26, 2001, 115 Stat. 322, 332,
335.)
-MISC1-
Historical and Revision Notes
---------------------------------------------------------------------
Revised Section Source (U.S. Code) Source (Statutes at
Large)
---------------------------------------------------------------------
5321(a)(1) 31:1054(b)(last Oct. 26, 1970, Pub.
sentence related to L. 91-508, Sec.
civil penalties). 205(b)(last
sentence related to
civil penalties),
207, 233, 234, 84
Stat. 1120, 1123.
31:1056(a).
5321(a)(2) 31:1103.
5321(a)(3) 31:1143(a), Sept. 21, 1973, Pub.
(b)(words after L. 93-110, Sec.
last comma). 203(a), (b)(words
after last comma),
87 Stat. 353.
5321(b) 31:1056(b).
5321(c) 31:1104.
-------------------------------
In subsection (a)(1), the words ''or a regulation prescribed
under this subchapter'' are added because of the restatement. The
words ''(except section 5315 of this title or a regulation
prescribed under section 5315)'' are added because 31:1141-1143 was
not enacted as a part of the Currency and Foreign Transactions
Reporting Act that is restated in this subchapter. The words ''is
liable to the United States Government for'' are substituted for
''the Secretary may assess upon'' in 31:1056(a) for consistency in
the revised title and with other titles of the United States Code.
The words ''the purposes of both civil and criminal penalties for''
in 31:1054(b)(last sentence)(related to civil penalties) are
omitted, and the words ''or a regulation prescribed under section
5318(2)'' are added, because of the restatement. The words ''the
violation continues'' are added for consistency in the revised
title and with other titles of the Code. The word ''separate''
before ''office'' is omitted as surplus.
In subsection (a)(2), the word ''impose'' is substituted for
''assess'' for consistency in the revised title and with other
titles of the Code. The word ''additional'' is substituted for
31:1103(last sentence words before last comma) to eliminate
unnecessary words. The words ''or a regulation prescribed under
section 5316'' are added because of the restatement. The words
''amount of this'', ''to be filed'', and ''actually'' are omitted
as surplus.
Subsection (a)(3) is substituted for 31:1143(a) and (b)(words
after last comma) for clarity and consistency and because of the
restatement.
In subsection (b), the words ''in the discretion of'', ''in the
name of the United States'', and ''of any person'' are omitted as
surplus.
In subsection (c), the words ''in his discretion'' and ''upon
such terms and conditions as he deems reasonable and just'' are
omitted as surplus. The word ''civil'' is added for clarity.
-REFTEXT-
REFERENCES IN TEXT
Sections 3 and 21 of the Federal Deposit Insurance Act, referred
to in subsecs. (a)(1) and (e)(1), are classified to sections 1813
and 1829b, respectively, of Title 12, Banks and Banking.
Section 123 of Public Law 91-508, referred to in subsec. (a)(1),
is classified to section 1953 of Title 12, Banks and Banking.
-COD-
CODIFICATION
Another section 365(c) of Pub. L. 107-56 amended the table of
sections at the beginning of this chapter.
-MISC3-
AMENDMENTS
2001 - Subsec. (a)(1). Pub. L. 107-56, Sec. 353(a),
365(c)(2)(B)(i), inserted ''or nonfinancial trade or business''
after ''financial institution'' in two places, ''or order issued''
after ''subchapter or a regulation prescribed'', and '', or
willfully violating a regulation prescribed under section 21 of the
Federal Deposit Insurance Act or section 123 of Public Law
91-508,'' after ''sections 5314 and 5315)''.
Subsec. (a)(6). Pub. L. 107-56, Sec. 365(c)(2)(B)(i), inserted
''or nonfinancial trade or business'' after ''financial
institution'' wherever appearing.
Subsec. (a)(7). Pub. L. 107-56, Sec. 363(a), added par. (7).
1996 - Subsec. (a)(7). Pub. L. 104-208 struck out par. (7) which
read as follows:
''(7) Financial institution identification violations. -
''(A) Penalty authorized. - The Secretary may impose a civil
money penalty on any person who willfully violates any provision
of section 5327 or any regulation prescribed under such section.
''(B) Maximum amount limitation. - The amount of any civil
money penalty imposed under subparagraph (A) shall not exceed
$10,000 per day for each day during which a report remains
unfiled or a report containing a material omission or
misstatement of fact remains uncorrected.''
1994 - Subsec. (a)(4)(A). Pub. L. 103-325, Sec. 411(b), struck
out ''willfully'' before ''violates''.
Subsec. (a)(5)(A). Pub. L. 103-322, Sec. 330017(a)(1) and Pub. L.
103-325, Sec. 413(a)(1), amended subpar. (A) identically, inserting
''any violation of'' after ''causing''.
Subsec. (e). Pub. L. 103-325, Sec. 406, added subsec. (e).
1992 - Subsec. (a)(4)(C). Pub. L. 102-550, Sec. 1525(b), struck
out ''under section 5317(d)'' after ''forfeiture to the United
States''.
Subsec. (a)(5)(A). Pub. L. 102-550, Sec. 1535(a)(2), inserted
''or any person willfully causing'' after ''willfully violates''.
Subsec. (a)(6). Pub. L. 102-550, Sec. 1561(a), amended par. (6)
generally. Prior to amendment, par. (6) read as follows:
''Negligence. - The Secretary of the Treasury may impose a civil
money penalty of not more than $500 on any financial institution
which negligently violates any provision of this subchapter or any
regulation prescribed under this subchapter.''
Subsec. (a)(7). Pub. L. 102-550, Sec. 1511(b), added par. (7).
1988 - Subsec. (a)(1). Pub. L. 100-690 inserted ''(if any)''
after ''transaction''.
1986 - Subsec. (a)(1). Pub. L. 99-570, Sec. 1356(c)(1), 1357(b),
substituted ''sections 5314 and 5315'' for ''section 5315'' in two
places, substituted ''5318(a)(2)'' for ''5318(2)'' in two places,
and substituted ''the greater of the amount (not to exceed
$100,000) involved in the transaction or $25,000'' for ''$10,000''.
Subsec. (a)(4). Pub. L. 99-570, Sec. 1357(a), added par. (4).
Subsec. (a)(5). Pub. L. 99-570, Sec. 1357(c), added par. (5).
Subsec. (a)(6). Pub. L. 99-570, Sec. 1357(d), added par. (6).
Subsec. (b). Pub. L. 99-570, Sec. 1357(e), amended subsec. (b)
generally. Prior to amendment, subsec. (b) read as follows: ''The
Secretary may bring a civil action to recover a civil penalty under
subsection (a)(1) or (2) of this section that has not been paid.''
Subsec. (c). Pub. L. 99-570, Sec. 1357(h), substituted
''subsection (c) or (d) of section 5317'' for ''section 5317(b)''.
Subsec. (d). Pub. L. 99-570, Sec. 1357(f), added subsec. (d).
1984 - Subsec. (a)(1). Pub. L. 98-473 substituted ''$10,000'' for
''$1,000''.
TERMINATION DATE OF 2001 AMENDMENT
Amendments by title III of Pub. L. 107-56 to terminate effective
on and after the first day of fiscal year 2005 if Congress enacts a
joint resolution that such amendments no longer have the force of
law, see section 303 of Pub. L. 107-56, set out as a Four-Year
Congressional Review; Expedited Consideration note under section
5311 of this title.
EFFECTIVE DATE OF 1992 AMENDMENT
Section 1561(b) of Pub. L. 102-550 provided that: ''The amendment
made by subsection (a) (amending this section) shall apply with
respect to violations committed after the date of the enactment of
this Act (Oct. 28, 1992).''
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by section 1357(a) of Pub. L. 99-570, applicable with
respect to violations committed after the end of the 3-month period
beginning Oct. 27, 1986, see section 1364(b) of Pub. L. 99-570, set
out as a note under section 5317 of this title.
Section 1364(c) of Pub. L. 99-570 provided that: ''The amendments
made by section 1357 (other than subsection (a) of such section)
(amending sections 5321 and 5322 of this title) shall apply with
respect to violations committed after the date of the enactment of
this Act (Oct. 27, 1986).''
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in section 5330 of this title; title
12 section 1829b.
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