A B C D E F H I L M N O P R S T U
A
Accept - §1010.100(a) A receiving financial institution, other than the recipient's financial institution, accepts a transmittal order by executing the transmittal order. A recipient's financial institution accepts a transmittal order by paying the recipient, by notifying the recipient of the receipt of the order or by otherwise becoming obligated to carry out the order.
Account -§1020.100(a) For purposes of §1020.220 (CIP)and §1010.230 (beneficial ownership)(1) Accountmeans a formal banking relationship established to provide or engage in services, dealings, or other financial transactions including a deposit account, a transaction or asset account, a credit account, or other extension of credit. Accountalso includes a relationship established to provide a safety deposit box or other safekeeping services, or cash management, custodian, and trust services. (2)Accountdoes not include: (i)A product or service where a formal banking relationship is not established with a person, such as check-cashing, wire transfer, or sale of a check or money order; (ii)An account that the bank acquires through an acquisition, merger, purchase of assets, or assumption of liabilities; or (iii)An account opened for the purpose of participating in an employee benefit plan established under the Employee Retirement Income Security Act of 1974.
Anti-Money Laundering Program Requirements - §1020.210 A financial institution regulated by a Federal functional regulator that is not subject to the regulations of a self-regulatory organization shall be deemed to satisfy the requirements of 31 U.S.C. 5318(h)(1) if the financial institution implements and maintains an anti-money laundering program that: (a)Complies with the requirements of §§1010.610 and 1010.620 of this chapter; (b)Includes, at a minimum: (1)A system of internal controls to assure ongoing compliance; (2)Independent testing for compliance to be conducted by bank personnel or by an outside party; (3) Designation of an individual or individuals responsible for coordinating and monitoring day-to-day compliance; (4)Training for appropriate personnel; and (5)Appropriate risk-based procedures for conducting ongoing customer due diligence, to include, but not be limited to: (i) Understanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile; and (ii) Conducting ongoing monitoring to identify and report suspicious transactions and, on a risk basis, to maintain and update customer information. For purposes of this paragraph (b)(5)(ii), customer information shall include information regarding the beneficial owners of legal entity customers (as defined in §1010.230); and(c) Complies with the regulation of its Federal functional regulator governing such programs.
Association of Financial Institutions - §1010.540(a)(2) A group or organization the membership of which is comprised entirely of financial institutions as defined in paragraph §1010.540(a)(1).
At One Time - §1010.100(b) For purposes of §1010.340 (reports of transportation of currency or monetary instruments) a person who transports, mails, ships or receives; is about to or attempts to transport, mail or ship; or causes the transportation, mailing, shipment or receipt of monetary instruments, is deemed to do so “at one time” if: (1) That person either alone, in conjunction with or on behalf of others; (2) Transports, mails, ships or receives in any manner; is about to transport, mail or ship in any manner; or causes the transportation, mailing, shipment or receipt in any manner of; (3) Monetary instruments; (4) Into the United States or out of the United States; (5) Totaling more than $10,000; (6)(i) On one calendar day; or (ii) If for the purpose of evading the reporting requirements of §1010.340, on one or more days.
Attorney General (AG) - §1010.100(c) The Attorney General of the United States.
B
Bank - §1010.100(d) Each agent, agency, branch or office within the United States of any person doing business in one or more of the capacities listed below: (1)A commercial bank or trust company organized under the laws of any State or of the United States; (2)A private bank; (3)A savings and loan association or a building and loan association organized under the laws of any State or of the United States;(4)An insured institution as defined in section 401 of the National Housing Act; (5)A savings bank, industrial bank or other thrift institution; (6)A credit union organized under the law of any State or of the United States; (7)Any other organization (except a money services business) chartered under the banking laws of any state and subject to the supervision of the bank supervisory authorities of a State;(8)A bank organized under foreign law; (9)Any national banking association or corporation acting under the provisions of section 25(a) of the Act of Dec. 23, 1913, as added by the Act of Dec. 24, 1919, ch. 18, 41 Stat. 378, as amended (12 U.S.C. 611-32).
Bank -§1020.220(1) A bank, as that term is defined in §1010.100(d), that is subject to regulation by a Federal functional regulator; and (2)A credit union, private bank, and trust company, as set forth in §1010.100(d)of this chapter, that does not have a Federal functional regulator.
Bank Secrecy Act (BSA)- §1010.100(e) The Currency and Foreign Transactions Reporting Act, its amendments, and the other statutes relating to the subject matter of that Act, have come to be referred to as the Bank Secrecy Act. These statutes are codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, 18 U.S.C. 1956, 18 U.S.C. 1957, 18 U.S.C. 1960, and 31 U.S.C. 5311-5314 and 5316-5332 and notes thereto. The BSA established requirements for record keeping 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. 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.
Beneficial Owner - §1010.230(d)(1) Each individual, if any, who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, owns 25 percent or more of the equity interests of a legal entity customer; and (2)A single individual with significant responsibility to control, manage, or direct a legal entity customer, including: (i)An executive officer or senior manager (e.g., a Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Managing Member, General Partner, President, Vice President, or Treasurer); or (ii)Any other individual who regularly performs similar functions. (3) 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 for purposes of paragraph 1010.230(d)(1)shall mean the trustee. If an entity listed in paragraph 1010.230(e)(2) (legal entity exclusion)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, no individual need be identified for purposes of paragraph 1010.230(d)(1)of this section with respect to that entity's interests.
Beneficial Owner- §1010.605(a) Special Due Diligence for Correspondent Accounts and Private Banking Accounts For purposes of §1010.610 (correspondent accounts), §1010.620 (private banking accounts), §1010.630 prohibition on shell banks) and §1010.670 (termination of correspondent relationship): An account means an individual who has a level of control over, or entitlement to, the funds or assets in the account that, as a practical matter, enables the individual, directly or indirectly, to control, manage or direct the account. The ability to fund the account or the entitlement to the funds of the account alone, however, without any corresponding authority to control, manage or direct the account (such as in the case of a minor child beneficiary), does not cause the individual to be a beneficial owner.
Beneficiary - §1010.100(f) The person to be paid by the beneficiary's bank.
Beneficiary's Bank -§1010.100(g) The bank or foreign bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order or which otherwise is to make payment to the beneficiary if the order does not provide for payment to an account.
Broker or Dealer in Securities - §1010.100(h) A broker or dealer in securities, registered or required to be registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934, except persons who register pursuant to section 15(b)(11) of the Securities Exchange Act of 1934.
Business Day - §1010.100(i) As used in this chapter with respect to banks, business day means that day, as normally communicated to its depository customers, on which a bank routinely posts a particular transaction to its customer's account.
C
Casino - §1010.100(t)(5)(i) A casino or gambling casino that: Is duly licensed or authorized to do business as such in the United States, whether under the laws of a State or of a Territory or Insular Possession of the United States, or under the Indian Gaming Regulatory Act or other Federal, State, or tribal law or arrangement affecting Indian lands (including, without limitation, a casino operating on the assumption or under the view that no such authorization is required for casino operation on Indian lands); and has gross annual gaming revenue in excess of $1 million. The term includes the principal headquarters and every domestic branch or place of business of the casino.(ii) For purposes of this paragraph 1010.100(t)(5), “gross annual gaming revenue” means the gross gaming revenue received by a casino, during either the previous business year or the current business year of the casino. A casino or gambling casino which is a casino for purposes of this chapter solely because its gross annual gaming revenue exceeds $1,000,000 during its current business year, shall not be considered a casino for purposes of this chapter prior to the time in its current business year that its gross annual gaming revenue exceeds $1,000,000. (iii)Any reference in this chapter, other than in this paragraph 1010.100(t)(5) and in paragraph 1010.100(t)(6)of this section, to a casino shall also include a reference to a card club, unless the provision in question contains specific language varying its application to card clubs or excluding card clubs from its application.
Card Club - §1010.100(t)(6)(i) A card club, gaming club, card room, gaming room, or similar gaming establishment that is duly licensed or authorized to do business as such in the United States, whether under the laws of a State, of a Territory or Insular Possession of the United States, or of a political subdivision of any of the foregoing, or under the Indian Gaming Regulatory Act or other Federal, State, or tribal law or arrangement affecting Indian lands (including, without limitation, an establishment operating on the assumption or under the view that no such authorization is required for operation on Indian lands for an establishment of such type), and that has gross annual gaming revenue in excess of $1,000,000. The term includes the principal headquarters and every domestic branch or place of business of the establishment. The term “casino,” as used in this chapter shall include a reference to “card club” to the extent provided in paragraph 1010.100(t)(5)(iii)of this section. (ii) For purposes of this paragraph 1010.100(t)(6), “gross annual gaming revenue” means the gross revenue derived from or generated by customer gaming activity (whether in the form of per-game or per-table fees, however computed, rentals, or otherwise) and received by an establishment, during either the establishment's previous business year or its current business year. A card club that is a financial institution for purposes of this chapter solely because its gross annual revenue exceeds $1,000,000 during its current business year, shall not be considered a financial institution for purposes of this chapter prior to the time in its current business year when its gross annual revenue exceeds $1,000,000.
Certification and Recertification- §1010.605(b) Means the certification and recertification forms regarding correspondent accounts for foreign banks located on FinCEN's Internet Web site, https://www.fincen.gov.
Check Casher – 1010.100(ff)(2) (i) In general.A person that accepts checks (as defined in the Uniform Commercial Code), or monetary instruments (as defined at §1010.100(dd)(1)(ii), (iii), (iv), and (v))in return for currency or a combination of currency and other monetary instruments or other instruments, in an amount greater than $1,000 for any person on any day in one or more transactions.(ii) Facts and circumstances; Limitations.Whether a person is a check casher as described in this section is a matter of facts and circumstances. The term “check casher” shall not include: (A)A person that sells prepaid access in exchange for a check (as defined in the Uniform Commercial Code), monetary instrument or other instrument; (B)A person that solely accepts monetary instruments as payment for goods or services other than check cashing services; (C)A person that engages in check cashing for the verified maker of the check who is a customer otherwise buying goods and services; (D)A person that redeems its own checks; or (E) A person that only holds a customer's check as collateral for repayment by the customer of a loan.
Closed Loop Prepaid Access - §1010.100(kkk) Prepaid access to funds or the value of funds that can be used only for goods or services in transactions involving a defined merchant or location (or set of locations), such as a specific retailer or retail chain, a college campus, or a subway system.
Commodity - §1010.100(j) Any good, article, service, right, or interest described in section 1a(4) of the Commodity Exchange Act (“CEA”), 7 U.S.C. 1a(4).
Common Carrier - §1010.100(k) Any person engaged in the business of transporting individuals or goods for a fee who holds himself out as ready to engage in such transportation for hire and who undertakes to do so indiscriminately for all persons who are prepared to pay the fee for the particular service offered.
Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) - §1060.300 Authorizes the Secretary of the Treasury to prohibit or impose strict conditions on the opening or maintaining in the United States of correspondent accounts and payable through accounts for foreign financial institutions that the Secretary determines have knowingly engaged in sanctionable activities.
Contract of Sale - §1010.100(l) Any sale, agreement of sale, or agreement to sell as described in section 1a(7) of the CEA, 7 U.S.C. 1a(7).
Correspondent Account - §1010.605(c)(1) The term correspondent accountmeans: (i) For purposes of §1010.610(a), (d) and (e) (correspondent account), an account established for a foreign financial institution to receive deposits from, or to make payments or other disbursements on behalf of, the foreign financial institution, or to handle other financial transactions related to such foreign financial institution; and(ii)For purposes of §§1010.610(b) and (c) (correspondent account), 1010.630 (prohibition on shell banks) and 1010.670 (termination of correspondent relationship) , an account established for a foreign bank to receive deposits from, or to make payments or other disbursements on behalf of, the foreign bank, or to handle other financial transactions related to such foreign bank.
Currency - §1010.100(m) The coin and paper money of the United States or of any other country that is designated as legal tender and that circulates and is customarily used and accepted as a medium of exchange in the country of issuance. Currency includes U.S. silver certificates, U.S. notes and Federal Reserve notes. Currency also includes official foreign bank notes that are customarily used and accepted as a medium of exchange in a foreign country.
Customer -§1020.220(1) (CIP) Customermeans: (i) A person that opens a new account; and(ii)An individual who opens a new account for: (A)An individual who lacks legal capacity, such as a minor; or (B)An entity that is not a legal person, such as a civic club. (2)Customerdoes not include: (i)A financial institution regulated by a Federal functional regulator or a bank regulated by a State bank regulator;(ii)A person described in§1020.315(b)(2) through (b)(4) (exempt persons); or (iii)A person that has an existing account with the bank, provided that the bank has a reasonable belief that it knows the true identity of the person.
Customer Due Diligence – §1020.210(b)(5) The financial institution must implement and maintain an anti-money laundering program that includes at a minimum appropriate risk-based procedures for conducting ongoing customer due diligence, to include, but not be limited to: (i) Understanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile; and (ii)Conducting ongoing monitoring to identify and report suspicious transactions and, on a risk basis, to maintain and update customer information. For purposes of this paragraph (b)(5)(ii), customer information shall include information regarding the beneficial owners of legal entity customers (as defined in §1010.230).
Customer Identification Program (CIP) - §1020.220 Banks must have a written CIP appropriate for its size and type of business that, at a minimum, includes name, date of birth, address, identification number.
D
Dealer In Foreign Exchange – 1010.(ff) (1) A person that accepts the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more countries in exchange for the currency, or other monetary instruments, funds, or other instruments denominated in the currency, of one or more other countries in an amount greater than $1,000 for any other person on any day in one or more transactions, whether or not for same-day delivery.
Deposit Account - §1010.100(n) Deposit accounts include transaction accounts described in paragraph 1010.100(ccc)(transaction account), savings accounts, and other time deposits.
Domestic - §1010.100(o) When used herein, refers to the doing of business within the United States, and limits the applicability of the provision where it appears to the performance by such institutions or agencies of functions within the United States.
E
Enhanced Due Diligence For Certain Foreign Banks - §1010.610(3)(b) In the case of a correspondent account established, maintained, administered, or managed in the United States for a foreign bank described in paragraph (c)of §1010.610, the due diligence program required by paragraph(a) of §1010.610 shall include enhanced due diligence procedures designed to ensure that the covered financial institution, at a minimum, takes reasonable steps to: (1)Conduct enhanced scrutiny of such correspondent account to guard against money laundering and to identify and report any suspicious transactions in accordance with applicable law and regulation. This enhanced scrutiny shall reflect the risk assessment of the account and shall include, as appropriate: (i)Obtaining and considering information relating to the foreign bank's anti-money laundering program to assess the risk of money laundering presented by the foreign bank's correspondent account; (ii)Monitoring transactions to, from, or through the correspondent account in a manner reasonably designed to detect money laundering and suspicious activity; and (iii)(A)Obtaining information from the foreign bank about the identity of any person with authority to direct transactions through any correspondent account that is a payable-through account, and the sources and beneficial owner of funds or other assets in the payable-through account.
Established Customer - §1010.100(p) A person with an account with the financial institution, including a loan account or deposit or other asset account, or a person with respect to which the financial institution has obtained and maintains on file the person's name and address, as well as taxpayer identification number (e.g.,social security or employer identification number) or, if none, alien identification number or passport number and country of issuance, and to which the financial institution provides financial services relying on that information.
Execution Date - §1010.100(q) The day on which the receiving financial institution may properly issue a transmittal order in execution of the sender's order. The execution date may be determined by instruction of the sender but cannot be earlier than the day the order is received, and, unless otherwise determined, is the day the order is received. If the sender's instruction states a payment date, the execution date is the payment date or an earlier date on which execution is reasonably necessary to allow payment to the recipient on the payment date.
F
Federal Functional Regulator - §1010.100(r)(1) The Board of Governors of the Federal Reserve System; (2) The Office of the Comptroller of the Currency; (3)The Board of Directors of the Federal Deposit Insurance Corporation; (4) The Office of Thrift Supervision; (5) The National Credit Union Administration; (6)The Securities and Exchange Commission; or (7)The Commodity Futures Trading Commission.
Filing Obligations for Reports of Transactions in Currency - §1010.311 Each financial institution other than a casino shall file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through, or to such financial institution which involves a transaction in currency of more than $10,000, except as otherwise provided in this section. In the case of the U.S. Postal Service, the obligation contained in the preceding sentence shall not apply to payments or transfers made solely in connection with the purchase of postage or philatelic products.
FinCEN - §1010.100(s) FinCEN means the Financial Crimes Enforcement Network, a bureau of the Department of the Treasury.
Financial Institution - §1010.100(t) Each agent, agency, branch, or office within the United States of any person doing business, whether or not on a regular basis or as an organized business concern, in one or more of the capacities listed below:(1) A bank (except bank credit card systems); (2)A broker or dealer in securities; (3)A money services business as defined in §1010.100(ff);(4)A telegraph company; (5)(i)Casino. (6)(i)Card club.(7)A person subject to supervision by any state or Federal bank supervisory authority; (8)A futures commission merchant;(9)An introducing broker in commodities; or (10)A mutual fund.
Financial Institution- §1020.100(d)(1) For the purposes of §1020.210 (AML program), a financial institution defined in 31 U.S.C. 5312(a)(2) or (c)(1) that is subject to regulation by a Federal functional regulator or a self-regulatory organization. (2)For the purposes of §1020.220 (CIP), financial institution is defined at 31 U.S.C. 5312(a)(2) and (c)(1).
Foreign Bank -§1010.100(u) A bank organized under foreign law, or an agency, branch or office located outside the United States of a bank. The term does not include an agent, agency, branch or office within the United States of a bank organized under foreign law.
Foreign Financial Agency - §1010.100(v) A person acting outside the United States 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.
Foreign Financial Institution - 1010.605(f)(1)(i) A foreign bank; (ii)Any branch or office located outside the United States of any covered financial institution described in paragraphs 1010.605(e)(1)(viii)through (x) (covered financial institution); (iii) Any other person organized under foreign law (other than a branch or office of such person in the United States) that, if it were located in the United States, would be a covered financial institution described in paragraphs1010.605(e)(1)(viii)through(x) (covered financial institution); and (iv)Any person organized under foreign law (other than a branch or office of such person in the United States) that is engaged in the business of, and is readily identifiable as: (A)A dealer in foreign exchange; or (B) A money transmitter.(2)For purposes of paragraph 1010.605(f)(1)(iv)of this section, a person is not “engaged in the business” of a dealer in foreign exchange or a money transmitter if such transactions are merely incidental to the person's business.
Foreign Shell Bank- 1010.605(g) means a foreign bank without a physical presence in any country.
Funds Transfer - §1010.100(w) The series of transactions, beginning with the originator's payment order, made for the purpose of making payment to the beneficiary of the order. The term includes any payment order issued by the originator's bank or an intermediary bank intended to carry out the originator's payment order. A funds transfer is completed by acceptance by the beneficiary's bank of a payment order for the benefit of the beneficiary of the originator's payment order. Electronic fund transfers as defined in section 903(7) of the Electronic Fund Transfer Act (15 U.S.C. 1693a(7)), as well as any other funds transfers that are made through an automated clearinghouse, an automated teller machine, or a point-of-sale system, are excluded from this definition.
Futures Commission Merchant - §1010.100(x) Any person registered or required to be registered as a futures commission merchant with the Commodity Futures Trading Commission (“CFTC”) under the CEA, except persons who register pursuant to section 4f(a)(2) of the CEA, 7 U.S.C. 6f(a)(2).
H
Housing Government Sponsored Enterprise (GSE) - §1010.100(mmm)(1) A “housing government sponsored enterprise” is one of the following “Regulated Entities” under 12 U.S.C. 4502(20) subject to the general supervision and regulation of the Federal Housing Finance Agency (FHFA):(i)The Federal National Mortgage Association;(ii)The Federal Home Loan Mortgage Corporation; or (iii)Each Federal Home Loan Bank. (2)The term “housing government sponsored enterprise” does not include any “Entity-Affiliated Party,” as defined in 12 U.S.C. 4502(11).
I
Identification required - §1020.312 Before concluding any transaction with respect to which a report is required under §1010.311 (transactions in currency), 1010.313 (aggregation), 1020.315 (exemptions for NBFI), 1021.311 (filing obligations for casinos) and 1021.313 (aggregation for casinos),of this chapter, a financial institution shall verify and record the name and address of the individual presenting a transaction, as well as record the identity, account number, and the social security or taxpayer identification number, if any, of any person or entity on whose behalf such transaction is to be effected. Verification of the identity of an individual who indicates that he or she is an alien or is not a resident of the United States must be made by passport, alien identification card, or other official document evidencing nationality or residence (e.g., a Provincial driver's license with indication of home address). Verification of identity in any other case shall be made by examination of a document, other than a bank signature card, that is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors (e.g., a driver's license or credit card). A bank signature card may be relied upon only if it was issued after documents establishing the identity of the individual were examined and notation of the specific information was made on the signature card. In each instance, the specific identifying information (i.e., the account number of the credit card, the driver's license number, etc.) used in verifying the identity of the customer shall be recorded on the report, and the mere notation of “known customer” or “bank signature card on file” on the report is prohibited.
Immediate Family Member- §1010.605(p)(2)(ii) means spouses, parents, siblings, children and a spouse's parents and siblings.
Indian Gaming Regulatory Act - §1010.100(y) The Indian Gaming Regulatory Act of 1988, codified at 25 U.S.C. 2701-2721 and 18 U.S.C. 1166-68.
Intermediary bank - §1010.100(z) A receiving bank other than the originator's bank or the beneficiary's bank.
Intermediary financial institution - §1010.100(aa) A receiving financial institution, other than the transmittor's financial institution or the recipient's financial institution. The term intermediary financial institution includes an intermediary bank.
Introducing broker-commodities - §1010.100(bb) Any person registered or required to be registered as an introducing broker with the CFTC under the CEA, except persons who register pursuant to section 4f(a)(2) of the CEA, 7 U.S.C. 6f(a)(2).
Investment security - §1010.100(cc) An instrument which: (1)Is issued in bearer or registered form; (2)Is of a type commonly dealt in upon securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment; (3)Is either one of a class or series or by its terms is divisible into a class or series of instruments; and (4)Evidences a share, participation or other interest in property or in an enterprise or evidences an obligation of the issuer.
Issuer or Seller of Traveler's Checks or Money Orders – 1010.100(ff) (3) A person that (i)Issues traveler's checks or money orders that are sold in an amount greater than $1,000 to any person on any day in one or more transactions; or(ii)Sells traveler's checks or money orders in an amount greater than $1,000 to any person on any day in one or more transactions.
L
Law enforcement agency- §1010.520(a)(2) A Federal, State, local, or foreign law enforcement agency with criminal investigative authority, provided that in the case of a foreign law enforcement agency, such agency is from a jurisdiction that is a party to a treaty that provides, or in the determination of FinCEN is from a jurisdiction that otherwise allows, law enforcement agencies in the United States reciprocal access to information comparable to that obtained under this section.
Legal Entity Customer – 1010.230(e)(1) Legal entity customermeans a corporation, limited liability company, or other entity that is created by the filing of a public document with a Secretary of State or similar office, a general partnership, and any similar entity formed under the laws of a foreign jurisdiction that opens an account. (2) (legal entity exemptions) Legal entity customer does not include: (i)A financial institution regulated by a Federal functional regulator or a bank regulated by a State bank regulator; (ii)A person described in§1020.315(b)(2) through (5) (exempt persons); (iii)An issuer of a class of securities registered under section 12 of the Securities Exchange Act of 1934 or that is required to file reports under section 15(d) of that Act; (iv)An investment company, as defined in section 3 of the Investment Company Act of 1940, that is registered with the Securities and Exchange Commission under that Act; (v)An investment adviser, as defined in section 202(a)(11) of the Investment Advisers Act of 1940, that is registered with the Securities and Exchange Commission under that Act; (vi)An exchange or clearing agency, as defined in section 3 of the Securities Exchange Act of 1934, that is registered under section 6 or 17A of that Act; (vii)Any other entity registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934; (viii)A registered entity, commodity pool operator, commodity trading advisor, retail foreign exchange dealer, swap dealer, or major swap participant, each as defined in section 1a of the Commodity Exchange Act, that is registered with the Commodity Futures Trading Commission; (ix)A public accounting firm registered under section 102 of the Sarbanes-Oxley Act; (x)A bank holding company, as defined in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841) or savings and loan holding company, as defined in section 10(n) of the Home Owners' Loan Act (12 U.S.C 1467a(n)); (xi)A pooled investment vehicle that is operated or advised by a financial institution excluded under paragraph (e)(2) of this section;(xii)An insurance company that is regulated by a State; (xiii)A financial market utility designated by the Financial Stability Oversight Council under Title VIII of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; (xiv)A foreign financial institution established in a jurisdiction where the regulator of such institution maintains beneficial ownership information regarding such institution; (xv)A non-U.S. governmental department, agency or political subdivision that engages only in governmental rather than commercial activities; and (xvi)Any legal entity only to the extent that it opens a private banking account subject to§1010.620 (private banking)of this chapter. (3)The following legal entity customers are subject only to the control prong of the beneficial ownership requirement: (i)A pooled investment vehicle that is operated or advised by a financial institution not excluded under paragraph 1010.230(e)(2)of this section; and (ii) Any legal entity that is established as a nonprofit corporation or similar entity and has filed its organizational documents with the appropriate State authority as necessary.
Loan or Finance Company - §1010.100(lll)A person engaged in activities that take place wholly or in substantial part within the United States in one or more of the capacities listed below, whether or not on a regular basis or as an organized business concern. This includes but is not limited to maintenance of any agent, agency, branch, or office within the United States. For the purposes of this paragraph 1010.100(lll), the term “loan or finance company” shall include a sole proprietor acting as a loan or finance company, and shall not include: A bank, a person registered with and functionally regulated or examined by the Securities and Exchange Commission or the Commodity Futures Trading Commission, any government sponsored enterprise regulated by the Federal Housing Finance Agency, any Federal or state agency or authority administering mortgage or housing assistance, fraud prevention or foreclosure prevention programs, or an individual employed by a loan or finance company or financial institution under this part. A loan or finance company is not a financial institution as defined in the regulations in this part at 1010.100(t). (1)Residential mortgage lender or originator.A residential mortgage lender or originator includes:(i) Residential mortgage lender.
M
Monetary Instruments - §1010.100(dd)(1) Monetary instruments include: (i)Currency; (ii)Traveler's checks in any form; (iii) All negotiable instruments (including personal checks, business checks, official bank checks, cashier's checks, third-party checks, promissory notes (as that term is defined in the Uniform Commercial Code), and money orders) that are either in bearer form, endorsed without restriction, made out to a fictitious payee (for the purposes of §1010.340 reports of transportation of currency or monetary instruments ), or otherwise in such form that title thereto passes upon delivery; (iv)Incomplete instruments (including personal checks, business checks, official bank checks, cashier's checks, third-party checks, promissory notes (as that term is defined in the Uniform Commercial Code), and money orders) signed but with the payee's name omitted; and (v)Securities or stock in bearer form or otherwise in such form that title thereto passes upon delivery. (2) Monetary instruments do not include warehouse receipts or bills of lading.
Money Laundering – §1010.505(b) An activity criminalized by 18 USC 1956 or 1957, or an activity that would be criminalized by 18 USC 1956 or 1957 if it occurred in the United States. The criminal practice of processing ill-gotten gains, or “dirty” money, through a series of transactions; in this way the funds are “cleaned” so that they appear to be proceeds from legal activities. It basically involves three independent steps that can occur simultaneously: placement, layering, and integration.
Money Services Business -§1010.100(ff)A person wherever located doing business,whether or not on a regular basis or as an organized or licensed business concern, wholly or in substantial part within the United States, in one or more of the capacities listed in paragraphs (ff)(1) through (ff)(7) of this section. This includes but is not limited to maintenance of any agent, agency, branch, or office within the United States. (1)Dealer in foreign exchange.(2)Check casher. (3)Issuer or seller of traveler's checks or money orders.(4)Provider of prepaid access.(5) Money transmitter.(6)U.S. Postal Service. (7)Seller of prepaid access.(8) Limitation.For the purposes of this section, the term “money services business” shall not include:(i)A bank or foreign bank; (ii) A person registered with, and functionally regulated or examined by, the SEC or the CFTC, or a foreign financial agency that engages in financial activities that, if conducted in the United States, would require the foreign financial agency to be registered with the SEC or CFTC; or (iii)A natural person who engages in an activity identified in paragraphs 1010.100(ff)(1) through 1010.100(ff)(5)of this section on an infrequent basis and not for gain or profit.
Money Transmitter - 1010.100(ff) (5)(i) In general.(A)A person that provides money transmission services. The term “money transmission services” means the acceptance of currency, funds, or other value that substitutes for currency from one person andthe transmission of currency, funds, or other value that substitutes for currency to another location or person by any means. “Any means” includes, but is not limited to, through a financial agency or institution; a Federal Reserve Bank or other facility of one or more Federal Reserve Banks, the Board of Governors of the Federal Reserve System, or both; an electronic funds transfer network; or an informal value transfer system; or (B) Any other person engaged in the transfer of funds.(ii)Facts and circumstances; Limitations.Whether a person is a money transmitter as described in this section is a matter of facts and circumstances. The term “money transmitter” shall not include a person that only: (A) Provides the delivery, communication, or network access services used by a money transmitter to support money transmission services; (B)Acts as a payment processor to facilitate the purchase of, or payment of a bill for, a good or service through a clearance and settlement system by agreement with the creditor or seller; (C) Operates a clearance and settlement system or otherwise acts as an intermediary solely between BSA regulated institutions. This includes but is not limited to the Fedwire system, electronic funds transfer networks, certain registered clearing agencies regulated by the Securities and Exchange Commission (“SEC”), and derivatives clearing organizations, or other clearinghouse arrangements established by a financial agency or institution; (D) Physically transports currency, other monetary instruments, other commercial paper, or other value that substitutes for currency as a person primarily engaged in such business, such as an armored car, from one person to the same person at another location or to an account belonging to the same person at a financial institution, provided that the person engaged in physical transportation has no more than a custodial interest in the currency, other monetary instruments, other commercial paper, or other value at any point during the transportation; (E)Provides prepaid access; or (F)Accepts and transmits funds only integral to the sale of goods or the provision of services, other than money transmission services, by the person who is accepting and transmitting the funds.
Multiple Branches - §1010.313(a) A financial institution includes all of its domestic branch offices, and any recordkeeping facility, wherever located, that contains records relating to the transactions of the institution's domestic offices, for purposes of the transactions in currency reporting requirements in this chapter.
Multiple Transactions - §1010.313(b) In the case of financial institutions other than casinos, for purposes of the transactions in currency reporting requirements in this chapter, multiple currency transactions shall be treated as a single transaction if the financial institution has knowledge that they are by or on behalf of any person and result in either cash in or cash out totaling more than $10,000 during any one business day (or in the case of the U.S. Postal Service, any one day). Deposits made at night or over a weekend or holiday shall be treated as if received on the next business day following the deposit.
Mutual Fund - §1010.100(gg) An “investment company” (as the term is defined in section 3 of the Investment Company Act (15 U.S.C. 80a-3)) that is an “open-end company” (as that term is defined in section 5 of the Investment Company Act (15 U.S.C. 80a-5)) that is registered or is required to register with the Commission under section 8 of the Investment Company Act (15 U.S.C. 80a-8).
N
New Account -1010.230(g)For the purposes of this section, new accountmeans each account opened at a covered financial institution by a legal entity customer on or after the applicability date.
O
Offshore Banking License – 1010.605(i) means a license to conduct banking activities that prohibits the licensed entity from conducting banking activities with the citizens of, or in the local currency of, the jurisdiction that issued the license.
Option on a commodity - §1010.100(hh) Any agreement, contract, or transaction described in section 1a(26) of the CEA, 7 U.S.C. 1a(26).
Originator - §1010.100(ii) The sender of the first payment order in a funds transfer. Can be an organization or person that initiates an ACH transaction to an account either as a debit or credit.
Originator's bank - §1010.100(jj) The receiving bank to which the payment order of the originator is issued if the originator is not a bank or foreign bank, or the originator if the originator is a bank or foreign bank.
P
Payment date - §1010.100(kk) The day on which the amount of the transmittal order is payable to the recipient by the recipient's financial institution. The payment date may be determined by instruction of the sender, but cannot be earlier than the day the order is received by the recipient's financial institution and, unless otherwise prescribed by instruction, is the date the order is received by the recipient's financial institution.
Payment order -§1010.100(ll) An instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing, to pay, or to cause another bank or foreign bank to pay, a fixed or determinable amount of money to a beneficiary if: (1) The instruction does not state a condition to payment to the beneficiary other than time of payment; (2) The receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender; and (3) The instruction is transmitted by the sender directly to the receiving bank or to an agent, funds transfer system, or communication system for transmittal to the receiving bank.
Person - §1010.100(mm) An individual, a corporation, a partnership, a trust or estate, a joint stock company, an association, a syndicate, joint venture, or other unincorporated organization or group, an Indian Tribe (as that term is defined in the Indian Gaming Regulatory Act), and all entities cognizable as legal personalities.
Phase I CTR Exemptions – §1020.315(b)(1)-(5) A bank, to the extent of its domestic operations; a federal, state, or local government agency or department; any entity exercising governmental authority within the United States; any entity (other than a bank) whose common stock or analogous equity interests are listed on the New York Stock Exchange or the American Stock Exchange or have been designated as a NASDAQ National Market Security listed on the NASDAQ Stock Market (with some exceptions); any subsidiary (other than a bank) of any “listed entity” that is organized under U.S. law and at least 51 percent of whose common stock or analogous equity interest is owned by the listed entity.
Phase II CTR Exemptions - §1020.315(b)(6)-(7) A business that does not fall into any of the Phase I categories may still be exempted under the Phase II exemptions if it qualifies as either a “non-listed business” or as a “payroll customer.”
Prepaid access - §1010.100(ww) Access to funds or the value of funds that have been paid in advance and can be retrieved or transferred at some point in the future through an electronic device or vehicle, such as a card, code, electronic serial number, mobile identification number, or personal identification number.
Private banking account - §1010.605(m) means an account (or any combination of accounts) maintained at a covered financial institution that: (1)Requires a minimum aggregate deposit of funds or other assets of not less than $1,000,000; (2) Is established on behalf of or for the benefit of one or more non-U.S. persons who are direct or beneficial owners of the account; and(3)Is assigned to, or is administered or managed by, in whole or in part, an officer, employee, or agent of a covered financial institution acting as a liaison between the covered financial institution and the direct or beneficial owner of the account.
Provider of prepaid access – 1010.100(ff)(4)(i) A provider of prepaid access is the participant within a prepaid program that agrees to serve as the principal conduit for access to information from its fellow program participants. The participants in each prepaid access program must determine a single participant within the prepaid program to serve as the provider of prepaid access. (ii) Considerations for provider determination.In the absence of registration as the provider of prepaid access for a prepaid program by one of the participants in a prepaid access program, the provider of prepaid access is the person with principal oversight and control over the prepaid program. Which person exercises “principal oversight and control” is a matter of facts and circumstances. Activities that indicate “principal oversight and control” include:(A)Organizing the prepaid program; (B)Setting the terms and conditions of the prepaid program and determining that the terms have not been exceeded;(C) Determining the other businesses that will participate in the prepaid program, which may include the issuing bank, the payment processor, or the distributor; (D) Controlling or directing the appropriate party to initiate, freeze, or terminate prepaid access; and (E)Engaging in activity that demonstrates oversight and control of the prepaid program. (iii) Prepaid program.A prepaid program is an arrangement under which one or more persons acting together provide(s) prepaid access. However, an arrangement is nota prepaid program if: (A)It provides closed loop prepaid access to funds not to exceed $2,000 maximum value that can be associated with a prepaid access device or vehicle on any day; (B)It provides prepaid access solely to funds provided by a Federal, State, local, Territory and Insular Possession, or Tribal government agency; (C)It provides prepaid access solely to funds from pre-tax flexible spending arrangements for health care and dependent care expenses, or from Health Reimbursement Arrangements (as defined in 26 U.S.C. 105(b) and 125) for health care expenses; or (D) (1)It provides prepaid access solely to:(i) Employment benefits, incentives, wages or salaries; or (ii)Funds not to exceed $1,000 maximum value and from which no more than $1,000 maximum value can be initially or subsequently loaded, used, or withdrawn on any day through a device or vehicle; and (2)It does not permit:(i) Funds or value to be transmitted internationally; (ii)Transfers between or among users of prepaid access within a prepaid program; or (iii)Loading additional funds or the value of funds from non-depository sources.
Purchase and Sale of Monetary Instruments Recordkeeping – 1010.415 Banks are required to verify the identity of persons purchasing monetary instruments for currency in amounts between $3,000 and $10,000, inclusive, and to maintain records of all such sales for a period of five years.
R
Receiving bank - §1010.100(nn) The bank or foreign bank to which the sender's instruction is addressed.
Receiving financial institution - §1010.100(oo) The financial institution or foreign financial agency to which the sender's instruction is addressed. The term receiving financial institution includes a receiving bank.
Recipient - §1010.100(pp) The person to be paid by the recipient's financial institution. The term recipient includes a beneficiary, except where the recipient's financial institution is a financial institution other than a bank.
Recipient's financial institution - §1010.100(qq) The financial institution or foreign financial agency identified in a transmittal order in which an account of the recipient is to be credited pursuant to the transmittal order or which otherwise is to make payment to the recipient if the order does not provide for payment to an account. The term recipient's financial institution includes a beneficiary's bank, except where the beneficiary is a recipient's financial institution.
Report of Foreign Bank and Financial Accounts (FBAR) – §1010.350 Each person (including a bank) subject to U.S. jurisdiction with a financial interest in, or signature or other authority over, a bank, a securities, or any other financial account in a foreign country must electronically file an FBAR if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year.
Report of International Transportation of Currency or Monetary Instruments (CMIR) – §1010.340 Each person (including a bank) who physically transports, mails, or ships currency or monetary instruments in excess of $10,000 at one time out of or into the United States (and each person who causes such transportation, mailing, or shipment) must file a CMIR.
Reports of transactions in currency - §1020.310 See §1010.311filing obligations for reports of transactions in currency.
Residential Mortgage Lender or Originator - §1010.100(lll)(1) A residential mortgage lender or originator includes:(i) Residential mortgage lender.The person to whom the debt arising from a residential mortgage loan is initially payable on the face of the evidence of indebtedness or, if there is no such evidence of indebtedness, by agreement, or to whom the obligation is initially assigned at or immediately after settlement. The term “residential mortgage lender” shall not include an individual who finances the sale of the individual's own dwelling or real property. (ii)Residential mortgage originator.A person who accepts a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan. (iii)Residential mortgage loan.A loan that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on: (A)A residential structure that contains one to four units, including, if used as a residence, an individual condominium unit, cooperative unit, mobile home or trailer; or (B) Residential real estate upon which such a structure is constructed or intended to be constructed.
S
Secretary - §1010.100(rr) The Secretary of the Treasury or any person duly authorized by the Secretary to perform the function mentioned.
Security - §1010.100(ss) Security means any instrument or interest described in section 3(a)(10) of the Securities Exchange Act of 1934, 15 U.S.C. 78c(a)(10).
Self-regulatory organization - §1010.100(tt)(1) Shall have the same meaning as provided in section 3(a)(26) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(26)); and (2) Means a “registered entity” or a “registered futures association” as provided in section 1a(29) or 17, respectively, of the Commodity Exchange Act (7 U.S.C. 1a(29), 21).
Seller of prepaid access - §1010.100(ff) (7) Any person that receives funds or the value of funds in exchange for an initial loading or subsequent loading of prepaid access if that person: (i)Sells prepaid access offered under a prepaid program that can be used before verification of customer identification under§1022.210(d)(1)(iv) (AML program for MSBs); or (ii)Sells prepaid access (including closed loop prepaid access) to funds that exceed $10,000 to any person during any one day, and has not implemented policies and procedures reasonably adapted to prevent such a sale.
Sender - §1010.100(uu) The person giving the instruction to the receiving financial institution.
Senior Foreign Political Figures – §1010.605(p)(1)(i)A current or former (A)Senior official in the executive, legislative, administrative, military, or judicial branches of a foreign government (whether elected or not);(B) Senior official of a major foreign political party; or (C)Senior executive of a foreign government-owned commercial enterprise; (ii)A corporation, business, or other entity that has been formed by, or for the benefit of, any such individual;(iii) An immediate family member of any such individual; and (iv)A person who is widely and publicly known (or is actually known by the relevant covered financial institution) to be a close associate of such individual. (2)For purposes of this definition: (i) Senior official or executivemeans an individual with substantial authority over policy, operations, or the use of government-owned resources; and (ii)Immediate family membermeans spouses, parents, siblings, children and a spouse's parents and siblings. (Also referred to as Politically Exposed Persons (PEPs))
Senior Official or Executive – §1010.605(p)(2)(i) An individual with substantial authority over policy, operations, or the use of government-owned resources
State -§1010.100(vv)The States of the United States and, wherever necessary to carry out the provisions of this chapter, the District of Columbia.
Structure (structuring) - §1010.100(xx) For purposes of §1010.314 (structured transactions), a person structures a transaction if that person, acting alone, or in conjunction with, or on behalf of, other persons, conducts or attempts to conduct one or more transactions in currency, in any amount, at one or more financial institutions, on one or more days, in any manner, for the purpose of evading the reporting requirements under §§1010.311 (transactions in currency), 1010.313 (aggregation), 1020.315 (exemptions for NBFI), 1021.311 (filing obligations for casinos) and 1021.313 (aggregation for casinos)of this chapter. “In any manner” includes, but is not limited to, the breaking down of a single sum of currency exceeding $10,000 into smaller sums, including sums at or below $10,000, or the conduct of a transaction, or series of currency transactions at or below $10,000. The transaction or transactions need not exceed the $10,000 reporting threshold at any single financial institution on any single day in order to constitute structuring within the meaning of this definition.
T
Taxpayer Identification Number - §1010.100(yy) Taxpayer Identification Number (“TIN”) is defined by section 6109 of the Internal Revenue Code of 1986 (26 U.S.C. 6109) and the Internal Revenue Service regulations implementing that section (e.g.,social security number or employer identification number).
Territories and Insular Possessions - §1010.100(zz) The Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands, and all other territories and possessions of the United States other than the Indian lands and the District of Columbia.
Terrorist Activity - §1010.505(c) means an act of domestic terrorism or international terrorism as those terms are defined in 18 U.S.C. 2331.
Transaction - §1010.100(bbb)(1) Except as provided in paragraph 1010.100(bbb)(2)of this section, transaction means a purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition, and with respect to a financial institution includes a deposit, withdrawal, transfer between accounts, exchange of currency, loan, extension of credit, purchase or sale of any stock, bond, certificate of deposit, or other monetary instrument, security, contract of sale of a commodity for future delivery, option on any contract of sale of a commodity for future delivery, option on a commodity, purchase or redemption of any money order, payment or order for any money remittance or transfer, purchase or redemption of casino chips or tokens, or other gaming instruments or any other payment, transfer, or delivery by, through, or to a financial institution, by whatever means effected. (2) For purposes of §§1010.311 (transactions in currency), 1010.313 (aggregation), 1020.315 (exemptions for NBFI), 1021.311 (filing obligations for casinos) and 1021.313 (aggregation for casinos), and other provisions of this chapter relating solely to the report required by those sections, the term “transaction in currency” shall mean a transaction involving the physical transfer of currency from one person to another. A transaction which is a transfer of funds by means of bank check, bank draft, wire transfer, or other written order, and which does not include the physical transfer of currency, is not a transaction in currency for this purpose.
Transaction account - §1010.100(ccc) Transaction accounts include those accounts described in 12 U.S.C. 461(b)(1)(C), money market accounts and similar accounts that take deposits and are subject to withdrawal by check or other negotiable order.
Transmittal of funds - §1010.100(ddd) A series of transactions beginning with the transmittor's transmittal order, made for the purpose of making payment to the recipient of the order. The term includes any transmittal order issued by the transmittor's financial institution or an intermediary financial institution intended to carry out the transmittor's transmittal order. The term transmittal of funds includes a funds transfer. A transmittal of funds is completed by acceptance by the recipient's financial institution of a transmittal order for the benefit of the recipient of the transmittor's transmittal order. Electronic fund transfers as defined in section 903(7) of the Electronic Fund Transfer Act (15 U.S.C. 1693a(7)), as well as any other funds transfers that are made through an automated clearinghouse, an automated teller machine, or a point-of-sale system, are excluded from this definition.
Transmittal order - §1010.100(eee) The term transmittal order includes a payment order and is an instruction of a sender to a receiving financial institution, transmitted orally, electronically, or in writing, to pay, or cause another financial institution or foreign financial agency to pay, a fixed or determinable amount of money to a recipient if: (1) The instruction does not state a condition to payment to the recipient other than time of payment; (2) The receiving financial institution is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender; and(3)The instruction is transmitted by the sender directly to the receiving financial institution or to an agent or communication system for transmittal to the receiving financial institution.
Transmittor - §1010.100(fff) The sender of the first transmittal order in a transmittal of funds. The term transmittor includes an originator, except where the transmittor's financial institution is a financial institution or foreign financial agency other than a bank or foreign bank.
Transmittor's financial institution - §1010.100(ggg) The receiving financial institution to which the transmittal order of the transmittor is issued if the transmittor is not a financial institution or foreign financial agency, or the transmittor if the transmittor is a financial institution or foreign financial agency. The term transmittor's financial institution includes an originator's bank, except where the originator is a transmittor's financial institution other than a bank or foreign bank.
U
United States - §1010.100(hhh) The States of the United States, the District of Columbia, the Indian lands (as that term is defined in the Indian Gaming Regulatory Act), and the Territories and Insular Possessions of the United States.
U.S. person - §1010.100(iii)(1) A United States citizen; or (2)A person other than an individual (such as a corporation, partnership or trust), that is established or organized under the laws of a State or the United States. Non-U.S. person means a person that is not a U.S. person.
U.S. Postal Service - §1010.100(jjj) The United States Postal Service, except with respect to the sale of postage or philatelic products.