Core Examination Procedures for Regulatory Requirements and Related Topics
Objective. Assess the bank’s compliance with statutory and regulatory requirements for special measures issued under section 311 of the USA PATRIOT Act.
1. Determine the extent of the bank’s international banking activities and the foreign jurisdictions in which the bank conducts transactions and activities, with particular emphasis on foreign correspondent banking and payable through accounts.
2. As applicable, determine whether the bank has established policies, procedures, and processes to respond to specific special measures imposed by FinCEN that are applicable to its operations. Evaluate the adequacy of the policies, procedures, and processes for detecting accounts or transactions with jurisdictions, financial institutions, or transactions subject to final special measures.
3. Determine, through discussions with management and review of the bank’s documentation, whether the bank has taken action in response to final special measures.
4. Determine all final special measures issued by FinCEN under section 311 that are applicable to the bank (refer to FinCEN Web site).
5. For any of the first four types of special measures, determine whether the bank obtained, recorded, or reported the information required by each particular special measure.
6. For the fifth special measure (prohibition), determine whether the bank complied with the prohibitions or restrictions required by each particular special measure, and complied with any other actions required by the special measures.
7. As necessary, search the bank’s MIS and other appropriate records for accounts or transactions with jurisdictions, financial institutions, or transactions subject to final special measures.
8. On the basis of examination procedures completed, including transaction testing, form a conclusion about the ability of policies, procedures, and processes to meet regulatory requirements associated with special measures.
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Foreign Bank and Financial Accounts Reporting