BSA/AML Examiner School Case Study

Internal Use Only

Account officer should make reasonable efforts to document and obtain (in the system or in a memorandum) the following additional information. Any memorandums should be sent to the BSA Officer. PEP Due Diligence Procedures The Bank's due diligence procedures regarding PEPs provides for appropriate scrutiny and monitoring, and include; but are not limited to, the following elements: 1. Identify the accountholder and beneficial owner, ensure the Bank has obtained all proper identification for all accountholders (W8, passport); 2. Identify the accountholder's country of residence; 3. Document the official responsibilities of the individual's office; 4. Document the nature of the title (i.e. honorary or salaried); 5. Document the level of authority over government activities or other officials; 6. Document the access to significant government assets or funds; 7. Document the proximity of the customer's residence and place of employment; 8. Identify the source of wealth; 9. Obtain information on immediate family members or close associates having transaction authority over the account; 10. Determine the purpose of the account and the expected volume and nature of account activity; It is the policy of the Bank to refuse to open a private banking account, suspend transaction activity of the account, file a suspicious activity report, or close the account in the event that appropriate due diligence procedures cannot be performed. Note: If the BSA Department determines that your high risk customer is subject to expanded review and needs further enhance due diligence, the account officer will be notified promptly. Money Services Businesses Guidelines Money Services Businesses (MSBs) include five distinct types of financial services providers and the U.S. Postal Service: 1. Currency dealers or exchangers; 2. Check cashiers; 3. Issuers of traveler's checks, money orders or stored value; 4. Sellers or redeemers of traveler's checks, money orders, or stored value; and 5. Money transmitters. Note: Financial institutions are not considered a Money Services Business. A threshold of $1,000 in money services business activity with the same person (in one type of activity) on the same day in one or more transactions is required for businesses in the first four categories. However, a business is considered an MSB if the business provides money transfer services in any amount. With limited exceptions, MSBs are subject to the full range of BSA regulatory controls, including the anti-money laundering program rule, suspicious activity and currency transaction reporting rules and various other identification and recordkeeping rules. Many MSBs, including the vast majority of money transmitters in the United States, operate through a system of agents. While agents are not presently

For Training Purposes Only

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