[Federal Register Volume 60, Number 164 (Thursday, August 24, 1995)]
[Proposed Rules]
[Pages 44146-44150]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-20842]
Federal Register / Vol. 60, No. 164 / Thursday, August 24, 1995 /
Proposed Rules
[[Page 44146]]
FEDERAL RESERVE SYSTEM
[Docket No. R-0888]
DEPARTMENT OF THE TREASURY
31 CFR Part 103
RIN 1506-AA16
Amendment to the Bank Secrecy Act Regulations Relating to
Recordkeeping for Funds Transfers and Transmittals of Funds by Banks
and Other Financial Institutions
AGENCY: Department of the Treasury; Board of Governors of the Federal
Reserve System.
ACTION: Joint proposed rule.
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SUMMARY: In January 1995, the Financial Crimes Enforcement Network
(FinCEN) of the Department of the Treasury (Treasury) and the Board of
Governors of the Federal Reserve System (Board) jointly published a
final rule that requires enhanced recordkeeping related to certain
funds transfers and transmittals of funds by financial institutions
(the joint rule). Also in January 1995, the Treasury adopted a
companion rule, known as the travel rule, that requires financial
institutions to include in transmittal orders certain information that
must be maintained under the joint rule. The joint rule sets forth
definitions of terms used in both rules. The original effective date of
these rules was January 1, 1996. Subsequent to adoption of these rules,
several banks have expressed concerns to the Treasury and the Board
that compliance with the joint rule and the travel rule would be
complicated if the parties to an international transfer were defined
differently in the Bank Secrecy Act regulations than they are defined
in the Uniform Commercial Code Article 4A. The Treasury and the Board
have proposed amendments to the joint rule's definitions and technical
conforming changes to the substantive provisions of the joint rule to
conform the meanings of the definitions of the parties to an
international transfer to their meanings under Article 4A of the
Uniform Commercial Code. These proposed amendments are intended to
reduce confusion of banks and nonbank financial institutions as to the
applicability of the joint rule and the travel rule and to reduce the
cost of complying with the rules' requirements. The Treasury and the
Board believe that the proposed amendments will not have a material
adverse effect on the rules' usefulness in law enforcement
investigations and proceedings. The proposed amendments should not
affect a bank's responsibilities under the rules with respect to
domestic funds transfers. Due to the uncertainties resulting from these
proposed amendments, the Treasury and the Board have delayed the
effective date of the joint rule; a document delaying the effective
date of the final joint rule until April 1, 1996, is published
elsewhere in today's Federal Register.
DATES: Comments must be submitted on or before September 25, 1995.
ADDRESSES: Each comment should be sent separately to both the Treasury
and the Board at the following addresses:
Treasury: Office of Regulatory Policy and Enforcement, Financial
Crimes Enforcement Network, Department of the Treasury, 2070 Chain
Bridge Road, Vienna, VA 22182, Attention: Funds Transfer NPRM. Comments
may be inspected between 10:00 a.m. and 4:00 p.m. at the Treasury
Library, located in room 5030, 1500 Pennsylvania Avenue, N.W.,
Washington, D.C. Persons wishing to inspect the comments submitted
should request an appointment at the Treasury Library, 202/622-0990.
Board: Comments, which should refer to Docket No. R-0888, may be
mailed to Mr. William W. Wiles, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue, N.W.,
Washington, D.C. 20551. Comments also may be delivered to Room B-2222
of the Eccles building between 8:45 a.m. and 5:15 p.m. weekdays, or to
the guard station in the Eccles Building courtyard on 20th Street N.W.
(between Constitution Avenue and C Street) at any time. Comments may be
inspected in Room MP-500 of the Martin Building between 9:00 a.m. and
5:00 p.m. weekdays, except as provided in 12 CFR 261.8 of the Board's
Rules Regarding Availability of Information.
FOR FURTHER INFORMATION CONTACT:
Treasury: Roger Weiner, Assistant Director, 202/622-0400; Stephen
R. Kroll, Legal Counsel, 703/905-3534; or Nina A. Nichols, Attorney-
Advisor, 703/905-3598, FinCEN.
Board: Louise L. Roseman, Associate Director, 202/452-2789; Gayle
Brett, Manager, Fedwire Section, 202/452-2934; Division of Reserve Bank
Operations and Payment Systems; Oliver Ireland, Associate General
Counsel, 202/452-3625; or Elaine Boutilier, Senior Counsel, 202/452-
2418, Legal Division, Board of Governors of the Federal Reserve System.
For the hearing impaired only, Telecommunication Device for the Deaf
(TDD), Dorothea Thompson, 202/452-3544.
SUPPLEMENTARY INFORMATION:
I. Background
The statute generally referred to as the Bank Secrecy Act (BSA)
(Pub. L. 91-508, codified at 12 U.S.C. 1829b and 1951-1959, and 31
U.S.C. 5311-5330) authorizes the Secretary of the Treasury to require
financial institutions to keep records and file reports that the
Secretary determines have a high degree of usefulness in criminal, tax,
or regulatory investigations or proceedings. The authority of the
Secretary to administer the BSA has been delegated to the Director of
FinCEN. The BSA was amended by the Annunzio-Wylie Anti-Money Laundering
Act of 1992 (Pub. L. 102-550), which authorizes the Treasury and the
Board to prescribe regulations to require maintenance of records
regarding domestic and international funds transfers. The Treasury and
the Board are required to promulgate jointly, after consultation with
state banking supervisors, recordkeeping requirements for international
funds transfers by depository institutions and nonbank financial
institutions. The Treasury and the Board are required to consider the
usefulness of recordkeeping rules for international funds transfers in
criminal, tax, or regulatory investigations or proceedings and the
effect of such rules on the cost and efficiency of the payments system.
The Treasury and the Board are authorized to promulgate regulations for
domestic funds transfers by depository institutions. The Treasury, but
not the Board, is authorized to promulgate recordkeeping and reporting
requirements for domestic funds transfers by nonbank financial
institutions.
In January 1995, the Treasury and the Board jointly published
enhanced recordkeeping requirements related to certain funds transfers
and transmittals of funds by banks and other financial institutions, in
accordance with the BSA (60 FR 220, January 3, 1995). At the same time,
the Treasury adopted a companion rule, known as the travel rule, that
requires financial institutions to include in transmittal orders
certain information that must be retained under the joint rule (60 FR
234, January 3, 1995). The joint rule sets forth definitions of terms
used in both rules. These rules were scheduled to become effective on
January 1, 1996.
II. Industry Concerns Regarding Definition of Parties to an
International Funds Transfer
Subsequent to adoption of these rules, several large banks as well
as bank
[[Page 44147]]
counsel have advised the Treasury and the Board that compliance with
the joint rule and the travel rule would be complicated if the parties
to an international funds transfer were defined differently in the
joint rule than they are in the Uniform Commercial Code Article 4A (UCC
4A). Under the joint rule adopted in January, the first U.S. bank
office that handles an incoming international funds transfer is defined
as the originator's bank.1 Under UCC 4A and the Board's Regulation
J governing Fedwire transfers (12 CFR Part 210, subpart B), which
incorporates UCC 4A, if the U.S. bank receives a payment order from a
foreign bank and executes a corresponding payment order to a subsequent
receiving bank, the first U.S. bank would be deemed an intermediary
bank rather than the originator's bank. Large banks that regularly
process international funds transfers believe that substantial
confusion would result from defining the parties to an international
funds transfer for the purposes of the BSA rules differently from the
manner in which they are defined under UCC 4A.
\1\ The originator's bank is defined as ``the receiving bank to
which the payment order of the originator is issued if the
originator is not a bank, or the originator if the originator is a
bank.'' (103.11(w)) A receiving bank is defined as ``the bank to
which the sender's instruction is addressed.'' (103.11(aa)) As the
definition of bank is limited to an ``agent, agency, branch or
office within the United States'' (103.11(c)), a receiving bank must
be a U.S. banking office, and therefore the originator's bank is the
first U.S. banking office to handle the transfer.
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In addition to the confusion created by defining the parties to an
international funds transfer in a manner that is not consistent with
the roles of the parties as defined by UCC 4A, several banks have
indicated that they believe the difference between the BSA and the UCC
4A definitions may cause certain problems in the application of the
joint rule and the travel rule to international funds transfers. The
following chart depicts a hypothetical funds transfer that serves to
illustrate the operational issues raised by the industry
representatives if the first U.S. bank in an incoming international
funds transfer were deemed to be the originator's bank and the last
U.S. bank in an outgoing international funds transfer were deemed to be
the beneficiary's bank:
----------------------------------------------------------------------------------------------------------------
Definitions of bank and FI
parties to transfer limited to US Definitions that conform to UCC 4A
Parties to transfer offices (rule published in meanings (proposed amended rule)
January 1995)
----------------------------------------------------------------------------------------------------------------
German Company.................... ................................. Originator/Transmittor.
German Bank 1..................... ................................. Originator's bank/Transmittor's FI.
German Bank 2..................... Originator/Transmittor........... Intermediary bank/Intermediary FI.
New York Bank 1................... Originator's bank/Transmittor's Intermediary bank/Intermediary FI.
FI.
New York Bank 2................... Intermediary bank/Intermediary's Intermediary bank/Intermediary FI.
FI.
California Bank................... Beneficiary's bank/Recipient's FI Intermediary bank/Intermediary FI.
Japanese Bank..................... Beneficiary/Recipient............ Beneficiary's bank/Recipient's FI.
Japanese Company.................. ................................. Beneficiary/Recipient.
----------------------------------------------------------------------------------------------------------------
In this transfer, a German company instructs its bank (German Bank
1) to send a dollar payment to Japanese Bank for credit to a Japanese
company. German Bank 1 forwards the payment instructions to its
correspondent, German Bank 2. German Bank 2 sends the payment
instructions via SWIFT to its New York correspondent, New York Bank 1.
New York Bank 1 executes a payment order via CHIPS to New York Bank 2.
New York Bank 2 forwards the payment order via Fedwire to California
Bank. California Bank sends the payment order via SWIFT to Japanese
Bank, which credits the account of the Japanese company.
III. Definitions Under Joint Rule as Published in January 1995
Under the joint rule as adopted in January, German Bank 2 is
defined as the originator (transmittor) of the transfer, because it is
the sender of the first payment order 2 in a funds transfer and
New York Bank 1 is defined as the originator's bank (transmittor's
financial institution). Japanese Bank 1, which is neither a bank nor a
financial institution under the BSA definitions, is defined as the
beneficiary and California Bank is defined as the beneficiary's bank.
In the example, New York Bank 1 as originator's bank would be subject
to the following requirements under the joint rule:
\2\ A payment order is defined as ``an instruction of a sender
to a receiving bank. . . .'' (31 CFR 103.11(y)) As noted above, a
receiving bank is defined as ``the bank to which the sender's
instruction is addressed.'' Because the BSA rules limit the
definition of bank to an office within the United States, the
instruction of a sender to the first U.S. banking office is defined
as the first payment order.
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A. Obtain and retain the name and address of German Bank 2 (the
originator) (103.33(e)(1)(i)). New York Bank 1 generally would have a
record of the name and address of German Bank 2, which in virtually all
cases would be an accountholder at New York Bank 1. In the rare case in
which German Bank 2 is not an established customer of New York Bank 1,
New York Bank 1 would be required to obtain this information.
B. Have the capability to retrieve the record of the funds transfer
by name or account number of German Bank 2 (103.33(e)(4)). All
financial institutions are currently subject to the general
retrievability requirements under section 103.38(d), which states that
all records required to be retained under 31 CFR Part 103 ``. . . shall
be filed or stored in such a way as to be accessible within a
reasonable time, taking into consideration the nature of the record,
and the amount of time expired since the record was made.'' While the
requirements of the joint rule emphasize the need for an originator's
bank to have the capability to retrieve funds transfer records by name
or account number of the originator, the bank would nonetheless have to
have the capability to retrieve these records if it were deemed to be
an intermediary bank.
C. Comply with the verification requirements if German Bank 2 is
not an established customer (103.33(e)(2)). If German Bank 2 were not
an established customer of New York Bank 1 (a situation that would
occur only rarely), New York Bank 1 would have to comply with the joint
rule's verification requirements. This would require manual
intervention in what is generally a highly automated process, and the
Treasury and the Board do not believe that the resulting information
would be highly useful to law enforcement.
In addition, under the travel rule, the originator's bank and each
intermediary bank (if the information is received from the sender)
would be required to:
D. Include the name, address, and account number of German Bank 2
in the payment order it executes (103.33(g)
[[Page 44148]]
(1) and (2)). New York Bank 1 typically would include in the payment
order it executes the SWIFT Bank Identification Code (BIC) or CHIPS
Universal Identifier (UID) of German Bank 2 (the originator), rather
than German Bank 2's name, address, and account number. The Treasury
believes that use of a widely-used industry code, such as a BIC, UID,
or routing number, to identify the transmittor constitutes compliance
with the travel rule requirement to include the name, address, and
account number of the transmittor in subsequent payment orders.
Information pertaining to German Bank 2 may not be retained in all
subsequent payment orders, however, because German Bank 2 generally
would be identified as the instructing bank, rather than the
originator's bank, in the CHIPS message sent by New York Bank 1. While
the identification of the bank included in the originator's bank field
generally is retained in subsequent payment orders, the identification
of the bank in the instructing bank field may change in subsequent
payment orders.3
\3\ Banks often define the parties to an international transfer
in the SWIFT, CHIPS, and Fedwire formats differently than the
parties are defined in the BSA rules as adopted in January. These
formats have fields for the identification of the originator's bank,
the instructing bank, the sender bank (the bank that sends the
transfer through SWIFT, CHIPS, or Fedwire), the receiver bank, the
intermediary bank, and the beneficiary's bank. The first U.S. or
foreign bank in a transfer is generally identified in the message
format as the originator's bank; the bank that immediately precedes
the sender bank (if different than the originator's bank) is
identified as the instructing bank. For transfers that are sent
through a large number of receiving banks, the identification of
instructing bank may change from payment order to payment order.
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California Bank, as beneficiary's bank, would be required under the
joint rule to (1) retain the information contained in the payment order
sent by New York Bank 2 (103.33(e)(1)(iii)); (2) have the capability to
retrieve the record of the funds transfer by name or account number of
Japanese Bank (103.33(e)(4)); and (3) comply with the verification
requirements if Japanese Bank is not an established customer
(103.33(e)(3)).
IV. Effect of Proposed Amendment
If New York Bank 1 and California Bank in the example above were
considered to be intermediary banks instead of the originator's bank
and beneficiary's bank, respectively, under the BSA rules, they would
be required under the joint rule to retain a copy of the payment order
they accept (103.33(e)(1)(ii)). As noted above, while there is no
specific retrievability requirement under the joint rule for
intermediary banks, under 103.38(d) information retained must be
``accessible.'' Under the travel rule, New York Bank 1 would be
required to include in its payment order to New York Bank 2 only the
information pertaining to the transmittor and other transfer
information that it received from German Bank 2 (103.33(g)(2)).
Similarly, New York Bank 2 and California Bank, as other intermediary
banks in the funds transfer, would be required to include this
information in the payment orders they execute if received in the
payment orders they accepted.
Treatment of New York Bank 1 and California Bank as intermediary
banks addresses the concerns of industry representatives. Under current
industry practice, banks generally would be in compliance with the
recordkeeping, retrievability, and travel rule requirements for
intermediary banks. The Treasury and the Board do not believe that
identifying the banks in an international transfer in the same manner
as they are defined in UCC 4A will reduce the usefulness of the
information to law enforcement, provided that intermediary banks comply
with the requirements of 103.38(d). As part of the 36-month review of
the effectiveness of the joint rule and the travel rule, Treasury will
monitor the experience of law enforcement in obtaining from
intermediary banks information retained pursuant to the joint rule.
V. Corresponding Changes Affecting Nonbank Financial Institutions
The example reviewed above involves banks, as banks have raised
concerns with the differences between the definitions of the parties to
international funds transfers in the joint rule and UCC 4A. Financial
institutions other than banks have not raised operational concerns with
the Treasury and the Board on this matter. The Treasury and the Board
believe, however, that nonbank financial institutions that conduct
international transmittals of funds may have similar compliance
concerns. Accordingly, the proposed amendments to the joint rule
include modifications that correspond to the changes that apply to
banks.
VI. Request for Comment
The Treasury and the Board request comment on proposed amendments
to the definitions that make the roles of the parties to an
international funds transfer consistent under the BSA rules and under
UCC 4A and that make parallel changes to the definitions of the parties
to an international transmittal of funds. The proposed amendments
include expansion of the definitions of beneficiary's bank,
originator's bank, payment order, receiving bank, receiving financial
institution, recipient's financial institution, transmittal order,
transmittor, and transmittor's financial institution to include both
domestic and foreign institutions. The Treasury and the Board have also
proposed technical conforming changes to the joint rule to clarify that
only bank and financial institution offices located within the United
States are subject to the joint rule's requirements.
These amendments should reduce confusion with respect to the
interpretation of the rules and should facilitate compliance with the
rules' requirements. Moreover, the Treasury and the Board do not
believe that these proposed amendments will increase the cost of
compliance with the rules' requirements for those banks and nonbank
financial institutions that have prepared to comply with the rules
under the assumption that the first U.S. banking office in an
international transfer is subject to the originator's bank
responsibilities.
In addition, the Treasury and the Board have revised section
103.33(e)(6) by deleting the word ``domestic'' prior to the word
``bank'' and prior to the words ``broker or dealer in securities.''
These changes have no material effect on the scope of the exclusions
set forth in this section as the word ``bank'' is defined to be limited
to offices located within the United States and the term ``broker or
dealer in securities'' is limited to brokers registered with the
Securities and Exchange Commission.4
\4\ The Treasury has also proposed companion amendments to the
travel rule. See document elsewhere in today's Federal Register.
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VII. Paperwork Reduction Act
The collection of information required by the joint final rule
whose amendment is proposed in this notice was submitted by the
Treasury to the Office of Management and Budget in accordance with the
requirements of the Paperwork Reduction Act (44 U.S.C. 3504(h)) under
control number 1505-0063. (See, 60 FR 227 (January 3, 1995)) The
collection is authorized, as before, by 12 U.S.C. 1829b and 1959 and 31
U.S.C. 5311-5330.
The changes to the joint final rule proposed in this document will
eliminate information collection requirements that were required by the
joint final rule. Therefore, no additional Paperwork Reduction Act
submissions are required.
[[Page 44149]]
VIII. Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 605(b)), the Treasury and the Board hereby certify that these
proposed amendments to the joint final rule will not have a significant
economic impact on a substantial number of small entities. The proposed
amendments eliminate uncertainty as to the application of the joint
final rule and reduce the cost of complying with the joint rule's
requirements. Furthermore, the proposed amendments affect international
funds transfers and transmittals of funds, which are handled almost
exclusively by large institutions. Accordingly, a regulatory
flexibility analysis is not required.
IX. Executive Order 12866
The Treasury finds that these proposed amendments to the joint rule
are not ``significant'' for purposes of Executive Order 12866. The
modifications should reduce the cost of compliance with the joint rule
and the travel rule. The Treasury believes that these proposed rule
changes will not affect adversely in a material way the economy, a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local, or tribal
governments or communities. These proposed revisions create no
inconsistencies with, nor do they interfere with actions taken or
planned by other agencies. Finally, these proposed revisions raise no
novel legal or policy issues. A cost and benefit analysis therefore is
not required.
X. Unfunded Mandates Reform Act of 1995 Statement
Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law
104-4 (Unfunded Mandates Act), signed into law on March 22, 1995,
requires that an agency prepare a budgetary impact statement before
promulgating a rule that includes a federal mandate that may result in
expenditure by state, local, and tribal governments, in the aggregate,
or by the private sector, of $100 million or more in any one year. The
Treasury has determined that it is not required to prepare a written
budgetary impact statement for the proposed amendments, and has
concluded that the proposed amendments are the most cost-effective and
least burdensome means of achieving the stated objectives of the rule.
List of Subjects in 31 CFR Part 103
Administrative practice and procedure, Banks, banking, Brokers,
Currency, Foreign banking, foreign currencies, Gambling,
Investigations, Penalties, Reporting and recordkeeping requirements,
Securities.
Amendment
For the reasons set forth in the preamble, 31 CFR Part 103 is
proposed to be amended as set forth below:
PART 103--FINANCIAL RECORDKEEPING AND REPORTING OF CURRENCY AND
FOREIGN TRANSACTIONS
1. The authority citation for Part 103 is revised to read as
follows:
Authority: 12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5330.
2. Section 103.11 is amended by revising paragraphs (e), (w), (y)
introductory text, (aa), (bb), (dd), (kk) introductory text, (ll), and
(mm) to read as follows:
Sec. 103.11 Meaning of terms.
* * * * *
(e) Beneficiary's bank. 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.
* * * * *
(w) Originator's bank. 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.
* * * * *
(y) Payment order. 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, in a fixed or determinable amount
of money to a beneficiary if:
* * * * *
(aa) Receiving bank. The bank or foreign bank to which the sender's
instruction is addressed.
(bb) Receiving financial institution. The financial institution or
foreign financial agency to which the sender's instruction is
addressed. The term receiving financial institution includes a
receiving bank.
* * * * *
(dd) Recipient's financial institution. 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.
* * * * *
(kk) Transmittal order. 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:
* * * * *
(ll) Transmittor. 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.
(mm) Transmittor's financial institution. 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.
* * * * *
3. In Sec. 103.33, paragraphs (e) introductory text, (e)(1)(i)
introductory text, (e)(1)(ii), (e)(1)(iii), (e)(6)(i)(A) through
(e)(6)(i)(G), (e)(6)(ii), (f) introductory text, (f)(1)(i) introductory
text, (f)(1)(ii), (f)(1)(iii), (f)(6)(i)(A) through (f)(6)(i)(G) and
(f)(6)(ii) are revised to read as follows:
Sec. 103.33 Records to be made and retained by financial institutions.
* * * * *
(e) Banks. Each agent, agency, branch, or office located within the
United States of a bank is subject to the requirements of this
paragraph (e) with respect to a funds transfer in the amount of $3,000
or more:
(1) Recordkeeping requirements. (i) For each payment order that it
accepts as an originator's bank, a bank shall obtain and retain either
the original or a microfilm, other copy, or electronic record of the
following information relating to the payment order:
* * * * *
(ii) For each payment order that it accepts as an intermediary
bank, a bank shall retain either the original or a microfilm, other
copy, or electronic record of the payment order.
[[Page 44150]]
(iii) for each payment order that it accepts as a beneficiary's
bank, a bank shall retain either the original or a microfilm, other
copy, or electronic record of the payment order.
* * * * *
(6) Exceptions. * * *
(i) * * *
(A) A bank;
(B) A wholly-owned domestic subsidiary of a bank chartered in the
United States;
(C) A broker or dealer in securities;
(D) A wholly-owned domestic subsidiary of a broker or dealer in
securities;
(E) The United States;
(F) A state or local government; or
(G) A federal, state or local government agency or instrumentality;
and
(ii) Funds transfers where both the originator and the beneficiary
are the same person and the originator's bank and the beneficiary's
bank are the same bank.
(f) Nonbank financial institutions. Each agent, agency, branch, or
office located within the United States of a financial institution
other than a bank is subject to the requirements of this paragraph (f)
with respect to a transmittal of funds in the amount of $3,000 or more:
(1) Recordkeeping requirements. (i) For each transmittal order that
it accepts as a transmittor's financial institution, a financial
institution shall obtain and retain either the original or a microfilm,
other copy, or electronic record of the following information relating
to the transmittal order:
* * * * *
(ii) For each transmittal order that it accepts as an intermediary
financial institution, a financial institution shall retain either the
original or a microfilm, other copy, or electronic record of the
transmittal order.
(iii) for each transmittal order that it accepts as a recipient's
financial institution, a financial institution shall retain either the
original or a microfilm, other copy, or electronic record of the
transmittal order.
* * * * *
(6) Exceptions. * * *
(i) * * *
(A) A bank;
(B) A wholly-owned domestic subsidiary of a bank chartered in the
United States;
(C) A broker or dealer in securities;
(D) A wholly-owned domestic subsidiary of a broker or dealer in
securities;
(E) The United States;
(F) A state or local government; or
(G) A federal, state or local government agency or instrumentality;
and
(ii) Transmittals of funds where both the transmittor and the
recipient are the same person and the transmittor's financial
institution and the recipient's financial institution are the same
broker or dealer in securities.
In concurrence:
By the Board of Governors of the Federal Reserve System, August
17, 1995.
William W. Wiles,
Secretary to the Board.
Dated: July 31, 1995.
By the Department of the Treasury.
Stanley E. Morris,
Director, Financial Crimes Enforcement Network.
[FR Doc. 95-20842 Filed 8-23-95; 8:45 am]
BILLING CODE 6210-01-P; 4820-03-P