[Federal Register Volume 81, Number 36 (Wednesday, February 24, 2016)]
[Proposed Rules]
[Page 9139]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-03830]
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DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
31 CFR Part 1010
RIN 1506-AB23
Financial Crimes Enforcement Network; Withdrawal of Finding and
Notice of Proposed Rulemaking Regarding Liberty Reserve S.A.
AGENCY: Financial Crimes Enforcement Network (``FinCEN''), Treasury.
ACTION: Withdrawal of finding and notice of proposed rulemaking.
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SUMMARY: This document withdraws FinCEN's finding that Liberty Reserve
S.A. (``Liberty Reserve'') is a financial institution of primary money
laundering concern and the related notice of proposed rulemaking
seeking to impose the fifth special measure regarding Liberty Reserve,
pursuant to section 311 of the USA PATRIOT Act (``Section 311'').
Because of material subsequent developments that have mitigated the
money laundering risks associated with Liberty Reserve, FinCEN has
determined that Liberty Reserve is no longer a primary money laundering
concern that warrants the implementation of a special measure under
Section 311.
DATES: The finding and notice of proposed rulemaking are withdrawn as
of February 24, 2016.
FOR FURTHER INFORMATION CONTACT: The FinCEN Resource Center at (800)
767-2825.
SUPPLEMENTARY INFORMATION:
I. Background
On October 26, 2001, the President signed into law the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (the
``USA PATRIOT Act''). Title III of the USA PATRIOT Act amends the anti-
money laundering provisions of the Bank Secrecy Act (BSA), codified at
12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314, 5316-
5332, to promote the prevention, detection, and prosecution of
international money laundering and the financing of terrorism.
Regulations implementing the BSA appear at 31 CFR chapter X. The
authority of the Secretary of the Treasury to administer the BSA and
its implementing regulations has been delegated to the Director of
FinCEN.
Section 311 of the USA PATRIOT Act (``Section 311'') grants the
Director of FinCEN the authority, upon finding that reasonable grounds
exist for concluding that a foreign jurisdiction, foreign financial
institution, class of transactions, or type of account is of ``primary
money laundering concern,'' to require domestic financial institutions
and financial agencies to take certain ``special measures'' to address
the primary money laundering concern. The special measures enumerated
under Section 311 are prophylactic safeguards that defend the U.S.
financial system from money laundering and terrorist financing. FinCEN
may impose one or more of these special measures in order to protect
the U.S. financial system from these threats. To that end, special
measures one through four, codified at 31 U.S.C. 5318A(b)(1) through
(4), impose additional recordkeeping, information collection, and
information reporting requirements on covered U.S. financial
institutions. The fifth special measure, codified at 31 U.S.C.
5318A(b)(5), allows the Director to prohibit or impose conditions on
the opening or maintaining of correspondent or payable-through accounts
for the identified institution by U.S. financial institutions.
II. The Finding and Notice of Proposed Rulemaking
A. The Finding and Notice of Proposed Rulemaking
Based upon review and analysis of relevant information,
consultations with relevant Federal agencies and departments, and after
consideration of the factors enumerated in Section 311, the Director of
FinCEN found that reasonable grounds existed for concluding that
Liberty Reserve S.A. (``Liberty Reserve'') was a financial institution
of primary money laundering concern. FinCEN published a proposed rule
proposing the imposition of the fifth special measure on June 6, 2013,
pursuant to the authority under 31 U.S.C. 5318A.\1\
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\1\ See 78 FR 34008 (June 6, 2013) (RIN 1506-AB23).
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B. Subsequent Developments
Since FinCEN's finding and related NPRM regarding Liberty Reserve,
material facts regarding the circumstances of the proposed rulemaking
have changed. Liberty Reserve was a web-based money transfer system
when FinCEN published notice of its finding and NPRM on June 6, 2013.
The Department of Justice announced on May 28, 2013 that it had charged
seven of Liberty Reserve's principals and employees with money-
laundering, seized five domain names, including ``LibertyReserve.com,''
and seized or restricted the activity of 45 bank accounts related to
Liberty Reserve. In light of these actions, Liberty Reserve has since
ceased to function as a financial institution.
III. Withdrawal of the Finding and NPRM
For the reasons set forth above, FinCEN hereby withdraws its
finding that Liberty Reserve is of primary money laundering concern and
the related NPRM published on June 6, 2013, seeking to impose the fifth
special measure regarding Liberty Reserve.
Jamal El-Hindi,
Deputy Director, Financial Crimes Enforcement Network.
[FR Doc. 2016-03830 Filed 2-23-16; 8:45 am]
BILLING CODE 4810-02-P