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New Bank Secrecy Act Examination Procedures Relating to USA PATRIOT Act
October 22, 2003
Circular No. 11550
To All Depository Institutions and Others Concerned in the Second Federal Reserve District:
In a supervisory letter (SR 03-17) dated October 20, 2003, the Federal Reserve and other federal banking agencies announced that new Bank Secrecy Act (BSA) examination procedures have been developed.
The procedures were updated in compliance with the USA PATRIOT Act (Act) that established new and enhanced measures to prevent, detect and prosecute money laundering and terrorism. Most of the measures directly affecting banking organizations are implemented through regulations issued by the U.S. Department of the Treasury (31 CFR Part 103) and set forth as amendments to the BSA. Since Treasury issued regulations to implement the requirements of sections 313, 314, and 319 of the Act, the federal banking agencies have updated their BSA examination procedures.
The Federal Reserve developed these procedures in consultation with the Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, Office of Thrift Supervision, and National Credit Union Administration to evaluate the compliance of banking organizations with the new regulations. These procedures are designed to help banking organizations implement the new BSA requirements and to facilitate a consistent supervisory approach among the financial institutions supervisory agencies.
The Federal Reserve is incorporating these procedures into an update to its overall Bank Secrecy Act/Anti-Money Laundering examination procedures. As other provisions of the Act are implemented through new regulations, additional procedures will be issued.