Section 311 etc. (ACAMS Notes)

Section 311:
Special measure for Primary Money Laundering concerns, this include foreign country, financial institution, type of an account or type of a transaction.
By designating an entity a primary money laundering concern, the government can force US banks to halt financial dealings with the designated entity. It can ask the domestic financial institution to
1. Keep records of each transaction including all the transaction participants and beneficiaries

2. Obtain information of beneficial ownership of any accounts maintained in US by a non US person or his/her representative.

3. Obtain information of all customers who are permitted to use or whose transactions are routed thru the designated financial institution’s
correspondent account.

4. Obtain information of all customers who are permitted to use or whose transactions are the designated financial institution’s payable thru account.

5. Order closure of payable thru and/or correspondent account.

Section 312:
Requires EDD for Correspondent and Private Banking.
The correspondent banking rule applies to bank, broker deals, future commission merchants, mutual funds and introducing broker dealers
The due diligence requirements are based on risk based approach.
EDD for private banking should include senior political figures, their families and close associates.
To fall under this rule Private Banking account must maintain a USD 1 Million or more of minimum aggregate deposit
Private bankers should identify the benefial owners of the account and their source of funds and how they plan to use it.

Section 313:
Do not transaction with Shell Banks.
In addition it prohibits the respondent bank to permit shell bank to access its correspondent bank account through nested correspondent relationship.

Section 319(b):
Allows the Treasury Secretary or attorney general to issue summons or to subpoena records of, a foreign bank that maintains a correspondent account in the US.

Foreign banks must designate a registered agent in US to accept service of such subpoenas.

Section 319(a):
If the funds the US pursues are deposited in a foreign bank which keeps an interbank account at a US bank, the US may attempt to forfeit the crime-tainted funds in the US account.

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