Upon identifying specific weaknesses in your AML program that there is not ample time to correct or strengthen prior to an upcoming BSA/AML exam, what action should a BSA Officer take relative to the Board of Directors?
Your Treasury Management (TM) department’s procedures indicate that clients who repeatedly exceed their daily remote deposit capture (RDC) limits are reviewed and reported/referred to BSA. Has your BSA department ever received an internal referral from TM regarding exceeded RDC daily limits?
What is the key to identifying and understanding the bank’s risk exposure and developing the necessary policies, procedures, systems and controls to mitigate BSA/AML risk?
Technology can be a key factor in the success of an AML program. What should be performed on your AML software prior to your next exam?
Is there a regulatory requirement for a bank to have a SAR Committee that reviews and approves every suspicious activity report prior to filing?
What factors should be considered when exiting existing account relationships?
From your review of the new beneficial ownership rule, in your opinion, will both prongs of this rule apply to our customer's customer?
My community bank was cited during a regulatory examination for not providing annual BSA training during the previous calendar year. I am concerned other types of mandatory training may be inadvertently overlooked. What other training are bank employees required to receive annually? Is a master list available somewhere?
Based on the following, it sounds as though we only have to worry about collecting beneficial ownership information for trustees of statutory trusts created by a filing with a Secretary of State or similar office. Does that sound accurate to you?
Here is the specific language I found regarding Trusts.
If a trust owns directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, 25 percent or more of the equity interests of a legal entity customer, the beneficial owner shall mean the trustee.
The definition of a “legal entity customer” would also not include trusts (other than statutory trusts created by a filing with a Secretary of State or similar office). This is because, unlike the legal entities that are subject to the final rule, a trust is a contractual arrangement between the person who provides the funds or other assets and specifies the terms (i.e., the grantor or settlor) and the person with control over the assets (i.e., the trustee), for the benefit of those named in the trust deed (i.e., the beneficiaries). Formation of a trust does not generally require any action by the state. As FinCEN noted in the NPRM, identifying a “beneficial owner” from among these parties, based on the definition in the proposed or final rule, would not be possible. FinCEN emphasizes that this does not and should not supersede existing obligations and practices regarding trusts generally.
The preamble to each of the CIP rules notes that, while financial institutions are not required to look through a trust to its beneficiaries, they “may need to take additional steps to verify the identity of a customer that is not an individual, such as obtaining information about
persons with control over the account.” Moreover, as FinCEN noted in the proposal, it is our understanding that where trusts are direct customers of financial institutions, financial institutions generally also identify and verify the identity of trustees, because trustees will necessarily be signatories on trust accounts (which in turn provides a ready source of information for law enforcement in the event of an investigation).
Furthermore, under supervisory guidance for banks, “in certain circumstances involving revocable trusts, the bank may need to gather information about the settlor, grantor, trustee, or other persons with the authority to direct the trustee, and who thus have authority or control over the account, in order to establish the true identity of the customer.” We reiterate our understanding that, consistent with existing obligations, financial institutions are already taking a risk based approach to collecting information with respect to various persons associated with trusts in order to know their customer, and that we expect financial institutions continue these practices as part of their overall efforts to safeguard against money laundering and terrorist financing.
I need to find out the methodology of BSA audit quality control. Is there a check list to ensure my audit firm is doing a good audit job? (basically evaluate the quality of audit, including scope, procedures and work papers).