Since InvesTrust is a Nationally Chartered Bank, we must comply with all aspects of the Bank Secrecy Act and the Anti-Money Laundering Act. Here is a brief history of these rules:
In 1970, Congress passed the Currency and Foreign Transactions Reporting Act commonly known as the “Bank Secrecy Act,” which established requirements for recordkeeping and reporting by private individuals, banks, and other financial institutions. The BSA was designed to help identify the source, volume, and movement of currency and other monetary instruments transported or transmitted into or out of the United States or deposited in financial institutions. The statute sought to achieve that objective by requiring individuals, banks, and other financial institutions to file currency reports with the U.S. Department of the Treasury (U.S. Treasury), properly identify persons conducting transactions, and maintain a paper trail by keeping appropriate records of financial transactions. These records enable law enforcement and regulatory agencies to pursue investigations of criminal, tax, and regulatory violations, if warranted, and provide evidence useful in prosecuting money laundering and other financial crimes.
The Money Laundering Control Act of 1986 augmented the BSA’s effectiveness by adding sections to the Federal Deposit Insurance Act (FDIA) and the Federal Credit Union (FCUA), which apply equally to banks of all charters. The Money Laundering Control Act of 1986 precludes circumvention of the BSA requirements by imposing criminal liability on a person or financial institution that knowingly assists in the laundering of money, or that structures transactions to avoid reporting them. The 1986 statute directed banks to establish and maintain procedures reasonably designed to ensure and monitor compliance with the reporting and recordkeeping requirements of the BSA. As a result, on January 27, 1987, all federal banking agencies issued essentially similar regulations requiring banks to develop programs for BSA compliance.
In response to the September 11, 2001, terrorist attacks, Congress passed the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act). Title III of the USA PATRIOT Act is the International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001. The USA PATRIOT Act is arguably the single most significant AML law that Congress has enacted since the BSA itself. Among other things, the USA PATRIOT Act criminalized the financing of terrorism and augmented the existing BSA framework by strengthening customer identification procedures; prohibiting financial institutions from engaging in business with foreign shell banks; requiring financial institutions to have due diligence procedures and, in some cases, enhanced due diligence (EDD) procedures for foreign correspondent and private banking accounts; and improving information sharing between financial institutions and the U.S. government.
We take our responsibilities under these acts seriously and devote time and resources to ensuring our compliance with them. Please contact InvesTrust if you have any questions about how this relates to your account.