For Immediate Release Contact: Public Affairs

Friday, December 20, 2002 (202) 622-2960

**FACT SHEET REGARDING THE TREASURY DEPARTMENT'S USE OF SANCTIONS
AUTHORIZED UNDER SECTION 311 OF THE USA PATRIOT ACT**

*\"With our designations today under Section 311, we are signaling to
the world that we are serious about ensuring that the international
financial system is safeguarded against the threat of money laundering.
Our words have meaning and our actions have real teeth: these
jurisdictions are bad for business, and U.S. institutions now must
recognize this fact.\"*

*"We are telling the world clearly that these jurisdictions are bad for
business and that their financial controls cannot be trusted. We are
serious about ensuring that the international financial system not be
abused by money launderers, terrorist financiers, and other
criminals.\"*

*\"Our use of Section 311 today to designate two jurisdictions as
\"primary money laundering concerns\" is yet another tool that we are
using to ensure the international financial system is not abused by
criminals. The world stands on notice: these jurisdictions do not take
the fight against money laundering and financial crime seriously.\"*

*-Deputy Treasury Secretary Ken Dam*

***[USA PATRIOT Act Section 311]{.underline}***

Section 311 (31 U.S.C. 5318A) authorizes Treasury to designate a foreign
jurisdiction, financial institution, class of transactions, or type of
account as being of "primary money laundering concern," and to impose
one or more of five "special measures."

Four of the special measures impose information-gathering and
record-keeping requirements upon those U.S. financial institutions
dealing either directly with the jurisdiction designated as one of
primary money laundering concern, or dealing with those having direct
dealings with the designated jurisdiction. Under the fifth special
measure, a U.S. financial institution may be prohibited from opening or
maintaining in the U.S. a correspondent account or a payable-through
account for a foreign financial institution if the account involves the
designee.

This is the first time this authority has been invoked.

**PO-3711**

***[Countries Designated: Ukraine and Nauru]{.underline}***

*[Ukraine]{.underline}*

Treasury, in consultation with other U.S. agencies, designated Ukraine
as being of "primary money laundering concern" on December 20, 2002.

Treasury intends to impose requirements on U.S. financial institutions
based on Special Measures 1 -- 4.

Treasury is soliciting comments from U.S. financial institutions
regarding the parameters of the proposed special measure.

*[Nauru]{.underline}*

Treasury, in consultation with other U.S. agencies, designated Nauru as
being of "primary money laundering concern" on December 20, 2002.

The Treasury intends to impose Special Measure 5, which will prohibit
U.S. financial institutions from opening or maintaining correspondent
accounts with Nauru-licensed financial institutions.

***[Financial Action Task Force (FATF)]{.underline}***

FATF is the premier multilateral body in the international fight against
money laundering and terrorist financing. For more information on FATF
consult its website at [www.fatf-gafi.org](http://www.fatf-gafi.org/).

Through its Non-Cooperative Countries and Territories (NCCT) process,
FATF seeks to identify and take action with respect to jurisdictions
that fail to meet international anti-money laundering standards.

As a result of their failure to put into place sufficient anti-money
laundering frameworks, FATF -- through the NCCT process -- has called
upon its members to impose countermeasures with respect to Ukraine and
Nauru.