PATRIOT Act

What is the purpose of the USA PATRIOT Act?

• To combat terrorism, money laundering, and other financial crimes
• To strengthen consumer protection laws
• To regulate international trade
• To establish new tax policies

Under the USA PATRIOT Act banks and credit unions are required to establish and maintain a Customer Identification Program (CIP) to:

• Monitor customer transactions for suspicious activities
• Verify the identity of customers opening accounts
• Share customer information with law enforcement agencies
• Conduct enhanced due diligence on high-risk customers

Enhanced Due Diligence (EDD) measures under the USA PATRIOT Act are specifically targeted towards:

• Low-risk customers
• High-risk customers
• All customers equally
• Foreign financial institutions

What is the purpose of an Anti-Money Laundering (AML) Program under the USA PATRIOT Act?

• To promote information sharing among financial institutions
• To enforce trade embargoes and economic sanctions
• To detect and report suspicious activities
• To conduct customer due diligence

Section 314(a) and Section 314(b) of the USA PATRIOT Act relate to:

• Customer identification requirements
• Information sharing between financial institutions
• Enhanced due diligence for high-risk customers
• Reporting large cash transactions

Non-compliance with the USA PATRIOT Act can result in:

• Enhanced due diligence requirements
• Reputational damage
• Regulatory enforcement actions
• All of the above

The Office of Foreign Assets Control (OFAC) is responsible for:

• Enforcing U.S. sanctions and trade embargoes
• Conducting financial investigations
• Regulating customer identification programs
• Implementing anti-money laundering programs

Compliance with OFAC regulations helps banks and financial institutions:

• Mitigate the risk of involvement in prohibited transactions
• Avoid identity theft
• Reduce interest rates for customers
• Facilitate international trade