Recent and highly publicized situations involving money laundering, such as the Raul Salinas case, demonstrate the importance of federal supervision and bank vigilance in this area. While it is impossible to identify every transaction at an institution that is potentially illegal or involves illegally obtained money, financial institutions must take reasonable measures to identify such transactions in order to ensure their own safe and sound operations. The proposal was intended to provide consistent, practical, and yet flexible guidance to banks on compliance with anti-money laundering requirements and to assist banks in protecting themselves from being unwitting victims of, or participants in, criminal activity. We never intended, as some commenters have suggested, to require banks to monitor every transaction, every customer and every account in a bank. Banks need a way to identify transactions that are suspicious from a law enforcement perspective.
Many banks already have formal programs to know the customers with which they do business.
For the many banks that have already implemented such a program, the proposal would require them to make sure their programs are in writing and approved by their respective boards of directors. Even banks without formal programs require personal identification such as a driver's license from an individual opening an account. For business customers, upon opening an account, a bank will often require articles of incorporation, board resolutions, partnership agreements, or business licenses, as appropriate. Institutions without formal programs have requested the federal banking agencies to provide guidance in this area. Such institutions have held off going forward with formal Know Your Customer programs so that they will not expend financial and personnel resources on programs that would not meet their primary federal regulator's standards.