Union Calendar No. 241
103D CONGRESS
2D SESSION
H. R. 3235
[Report No. 103–438]
A BILL
To amend subchapter II of chapter 53 of title 31,
United States Code, to improve enforcement of
antimoney laundering laws, and for other pur-
poses.
MARCH 21, 1994
Reported with an amendment, committed to the Commit-
tee of the Whole House on the State of the Union, and
ordered to be printed
IB
Union Calendar No. 241
103D CONGRESS
2D SESSION
H. R. 3235
[Report No. 103–438]
To amend subchapter II of chapter 53 of title 31, United States Code,
to improve enforcement of antimoney laundering laws, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 7, 1993
Mr. GONZALEZ (for himself and Mr. NEAL of North Carolina) introduced the
following bill; which was referred to the Committee on Banking, Finance
and Urban Affairs
NOVEMBER 10, 1993
Additional sponsors: Mr. FLAKE, Mr. KANJORSKI, Mr. PICKLE, Ms.
VELA´ZQUEZ, and Mr. HINCHEY
MARCH 21, 1994
Additional sponsors: Mr. WYNN, Mr. TORRES, Mr. MINGE, and Mr. KLEIN
MARCH 21, 1994
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on October 7, 1993]
A BILL
To amend subchapter II of chapter 53 of title 31, United
States Code, to improve enforcement of antimoney laun-
dering laws, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Money Laundering Suppression Act of 1994’’.
(b) TABLE OF CONTENTS.—
Sec. 1. Short title; table of contents.
Sec. 2. Reform of CTR exemption requirements to reduce number and size of re-
ports consistent with effective law enforcement.
Sec. 3. Single designee for reporting of suspicious transactions.
Sec. 4. Improvement of identification of money laundering schemes.
Sec. 5. Negotiable instruments drawn on foreign banks subject to recordkeeping
and reporting requirements.
Sec. 6. Imposition of civil money penalties by appropriate Federal banking agen-
cies.
Sec. 7. Uniform State licensing and regulation of check cashing, currency ex-
change, and money transmitting businesses.
Sec. 8. Registration of money transmitting businesses to promote effective law en-
forcement.
Sec. 9. Uniform Federal regulation of casinos.
Sec. 10. Uniform Federal administration of recordkeeping and reporting require-
ments.
Sec. 11. Criminal and civil penalty for structuring domestic and international
transactions.
Sec. 12. GAO study of cashiers’ checks.
Sec. 13. Technical corrections.
SEC. 2. REFORM OF CTR EXEMPTION REQUIREMENTS TO
REDUCE NUMBER AND SIZE OF REPORTS
CONSISTENT 
WITH 
EFFECTIVE 
LAW 
EN-
FORCEMENT.
(a) IN GENERAL.—Section 5313 of title 31, United
States Code, is amended by adding at the end the following
new subsections:
‘‘(d) MANDATORY EXEMPTIONS FROM REPORTING RE-
QUIREMENTS.—
‘‘(1) IN GENERAL.—The Secretary of the Treas-
ury shall exempt, pursuant to section 5318(a)(5), a
depository institution from the reporting require-
ments of subsection (a) with respect to transactions
between the depository institution and the following
categories of entities:
‘‘(A) Another depository institution.
‘‘(B) A department or agency of the United
States, any State, or any political subdivision of
any State.
‘‘(C) Any entity established under the laws
of the United States, any State, or any political
subdivision of any State, or under an interstate
compact between 2 or more States, which exer-
cises governmental authority on behalf of the
United States, the State, or the political subdivi-
sion.
‘‘(D) Any business or category of business
the reports on which have little or no value for
law enforcement purposes.
‘‘(2) NOTICE OF EXEMPTION.—The Secretary of
the Treasury shall publish in the Federal Register at
such times as the Secretary determines to be appro-
priate (but not less frequently than once each year)
a list of all the entities whose transactions with a de-
pository institution are exempt under this subsection
from the reporting requirements of subsection (a).
‘‘(e) DISCRETIONARY EXEMPTIONS FROM REPORTING
REQUIREMENTS.—
‘‘(1) IN GENERAL.—The Secretary of the Treas-
ury may exempt, pursuant to section 5318(a)(5), a
depository institution from the reporting require-
ments of subsection (a) with respect to transactions
between the depository institution and a qualified
business customer of the institution on the basis of in-
formation submitted to the Secretary by the institu-
tion in accordance with procedures which the Sec-
retary shall establish.
‘‘(2) 
QUALIFIED
BUSINESS
CUSTOMER
DE-
FINED.—For purposes of this subsection, the term
‘qualified business customer’ means a business
which—
‘‘(A) maintains a transaction account (as
defined in section 19(b)(1)(C) of the Federal Re-
serve Act) at the depository institution;
‘‘(B) frequently engages in transactions
with the depository institution which are subject
to the reporting requirements of subsection (a);
and
‘‘(C) meets criteria which the Secretary de-
termines are sufficient to ensure that the pur-
poses of this subchapter are carried out without
requiring a report with respect to such trans-
actions.
‘‘(3) CRITERIA FOR EXEMPTION.—The Secretary
of the Treasury shall establish, by regulation, the cri-
teria for granting and maintaining an exemption
under paragraph (1).
‘‘(4) GUIDELINES.—
‘‘(A) IN
GENERAL.—The Secretary of the
Treasury shall establish guidelines for depository
institutions to follow in selecting customers for
an exemption under this subsection.
‘‘(B) CONTENTS.—The guidelines may in-
clude a description of the types of businesses or
an itemization of specific businesses for which no
exemption will be granted under this subsection
to any depository institution.
‘‘(5) ANNUAL
REVIEW.—The Secretary of the
Treasury shall prescribe regulations requiring each
depository institution to—
‘‘(A) review, at least once each year, the
qualified business customers of such institution
transaction or the customer engaging in the
transaction; or
‘‘(B) has reason to believe at the time the
exemption is granted or the transaction is en-
tered into that the customer or the transaction
does not meet the criteria established for grant-
ing such exemption.
‘‘(2) COORDINATION WITH OTHER PROVISIONS.—
Any exemption granted by the Secretary of the Treas-
ury under section 5318(a) in accordance with this
section, and any transaction which is subject to such
exemption, shall be subject to any other provision of
law applicable to such exemption, including—
‘‘(A) the authority of the Secretary, under
section 5318(a)(5), to revoke such exemption at
any time; and
‘‘(B) any requirement to report, or any au-
thority to require a report on, any possible viola-
tion of any law or regulation or any suspected
criminal activity.
‘‘(g) DEPOSITORY INSTITUTION DEFINED.—For pur-
poses of this section, the term ‘depository institution’—
‘‘(1) has the meaning given to such term in sec-
tion 19(b)(1)(A) of the Federal Reserve Act; and
‘‘(2) includes—
‘‘(A) any branch, agency, or commercial
lending company (as such terms are defined in
section 1(b) of the International Banking Act of
1978);
‘‘(B) any corporation chartered under sec-
tion 25A of the Federal Reserve Act; and
‘‘(C) any corporation having an agreement
or undertaking with the Board of Governors of
the Federal Reserve System under section 25 of
the Federal Reserve Act.’’.
(b) REPORT REDUCTION GOAL; REPORTS.—
(1) IN GENERAL.—In implementing the amend-
ment made by subsection (a), the Secretary of the
Treasury shall seek to reduce, within a reasonable pe-
riod of time, the number of reports required to be filed
in the aggregate by depository institutions pursuant
to section 5313(a) of title 31, United States Code, by
at least 30 percent of the number filed during the
year preceding the date of the enactment of this Act.
(2) INTERIM
REPORT.—The Secretary of the
Treasury shall submit a report to the Congress not
later than the end of the 180-day period beginning on
the date of the enactment of this Act on the progress
made by the Secretary in implementing the amend-
ment made by subsection (a).
(3) ANNUAL
REPORT.—The Secretary of the
Treasury shall submit an annual report to the Con-
gress after the end of each of the first 5 calendar years
which begin after the date of the enactment of this Act
on the extent to which the Secretary has reduced the
overall number of currency transaction reports filed
with the Secretary pursuant to section 5313(a) of title
31, United States Code, consistently with the purposes
of such section and effective law enforcement.
(c) STREAMLINED
CURRENCY
TRANSACTION
RE-
PORTS.—The Secretary of the Treasury shall take such ac-
tion as may be appropriate to redesign the format of reports
required to be filed by any financial institution (as defined
in section 5312(a)(2) of title 31, United States Code) under
section 5313(a) of title 31, United States Code, to eliminate
the need to report information which has little or no value
for law enforcement purposes and reduce the time and effort
required to prepare such report for filing by any such fi-
nancial institution under such section.
SEC. 3. SINGLE DESIGNEE FOR REPORTING OF SUSPICIOUS
TRANSACTIONS.
(a) IN GENERAL.—Section 5318(g) of title 31, United
States Code, is amended by adding at the end the following
new paragraph:
‘‘(4) SINGLE
DESIGNEE
FOR
REPORTING
SUS-
PICIOUS TRANSACTIONS.—
‘‘(A) IN
GENERAL.—In requiring reports
under paragraph (1) of suspicious transactions,
the Secretary of the Treasury shall designate, to
the extent practicable and appropriate, a single
officer or agency of the United States to whom
such reports shall be made.
‘‘(B) DUTY OF DESIGNEE.—The officer or
agency of the United States designated by the
Secretary of the Treasury pursuant to subpara-
graph (A) shall refer any report of a suspicious
transaction to any appropriate law enforcement
or supervisory agency.
‘‘(C) COORDINATION WITH OTHER REPORT-
ING
REQUIREMENTS.—Subparagraph (A) shall
not be construed as precluding any supervisory
agency for any financial institution from requir-
ing the financial institution to submit any infor-
mation or report to the agency or another agency
pursuant to any provision of law other than this
subsection.’’.
(b) REPORTS.—
(1) REPORTS REQUIRED.—The Secretary of the
Treasury shall submit an annual report to the Con-
gress at the times required under paragraph (2) on
the number of suspicious transactions reported to the
officer 
or 
agency 
designated 
under 
section
5318(g)(4)(A) of title 31, United States Code, during
the period covered by the report and the disposition
of such reports.
(2) TIME FOR SUBMITTING REPORTS.—The 1st
report required under paragraph (1) shall be filed be-
fore the end of the 1-year period beginning on the
date of the enactment of the Money Laundering Sup-
pression Act of 1994 and each subsequent report shall
be filed within 90 days after the end of each of the
5 calendar years which begin after such date of enact-
ment.
(c) DESIGNATION REQUIRED TO BE MADE EXPEDI-
TIOUSLY.—The initial designation of an officer or agency
of the United States pursuant to the amendment made by
subsection (a) shall be made before the end of the 180-day
period beginning on the date of the enactment of this Act.
SEC. 4. IMPROVEMENT OF IDENTIFICATION OF MONEY
LAUNDERING SCHEMES.
(a) ENHANCED TRAINING, EXAMINATIONS, AND RE-
FERRALS BY BANKING AGENCIES.—Before the end of the 6-
month period beginning on the date of the enactment of this
Act, each appropriate Federal banking agency shall, in con-
sultation with the Secretary of the Treasury and other ap-
propriate law enforcement agencies—
(1) review and enhance training and examina-
tion procedures to improve the identification of
money laundering schemes involving depository insti-
tutions; and
(2) review and enhance procedures for referring
cases to any appropriate law enforcement agency.
(b) IMPROVED REPORTING OF CRIMINAL SCHEMES BY
LAW ENFORCEMENT AGENCIES.—The Secretary of the
Treasury and each appropriate law enforcement agency
shall provide, on a regular basis, information regarding
money laundering schemes and activities involving deposi-
tory institutions to each appropriate Federal banking agen-
cy in order to enhance the agency’s ability to examine for
and identify money laundering activity.
(c) REPORT TO CONGRESS.—The Financial Institu-
tions Examination Council shall submit a report on the
progress made in carrying out subsection (a) and the useful-
ness of information received pursuant to subsection (b) to
the Congress by the end of the 1-year period beginning on
the date of the enactment of this Act.
(d) DEFINITIONS.—The terms ‘‘appropriate Federal
banking agency’’ and ‘‘Federal banking agencies’’ have the
same meanings as in section 3 of the Federal Deposit Insur-
ance Act.
SEC. 5. NEGOTIABLE INSTRUMENTS DRAWN ON FOREIGN
BANKS SUBJECT TO RECORDKEEPING AND
REPORTING REQUIREMENTS.
Section 5312(a)(3) of title 31, United States Code, is
amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (A);
(2) by striking the period at the end of subpara-
graph (B) and inserting ‘‘; and’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(C) as the Secretary of the Treasury shall
provide by regulation for purposes of section
5316, checks, drafts, notes, money orders, and
other similar instruments which are drawn on or
by a foreign financial institution and are not in
bearer form.’’.
SEC. 6. IMPOSITION OF CIVIL MONEY PENALTIES BY AP-
PROPRIATE FEDERAL BANKING AGENCIES.
Section 5321 of title 31, United States Code, is
amended by adding at the end the following new subsection:
‘‘(e) DELEGATION
OF ASSESSMENT AUTHORITY
TO
BANKING AGENCIES.—
‘‘(1) IN GENERAL.—The Secretary of the Treas-
ury shall delegate, in accordance with section
5318(a)(1) and subject to such terms and conditions
as the Secretary may impose in accordance with
paragraph (3), any authority of the Secretary to as-
sess a civil money penalty under this section on de-
pository institutions (as defined in section 3 of the
Federal Deposit Insurance Act) to the appropriate
Federal banking agencies (as defined in such section
3).
‘‘(2) AUTHORITY OF AGENCIES.—Subject to any
term or condition imposed by the Secretary of the
Treasury under paragraph (3), the provisions of this
section shall apply to an appropriate Federal banking
agency to which is delegated any authority of the Sec-
retary under this section in the same manner such
provisions apply to the Secretary.
‘‘(3) TERMS AND CONDITIONS.—
‘‘(A) IN
GENERAL.—The Secretary of the
Treasury shall prescribe by regulation the terms
and conditions which shall apply to any delega-
tion under paragraph (1).
‘‘(B) MAXIMUM
DOLLAR
AMOUNT.—The
terms and conditions authorized under subpara-
graph (A) may include, in the Secretary’s sole
discretion, a limitation on the amount of any
civil penalty which may be assessed by an ap-
propriate Federal banking agency pursuant to a
delegation under paragraph (1).’’.
SEC. 7. UNIFORM STATE LICENSING AND REGULATION OF
CHECK CASHING, CURRENCY EXCHANGE, AND
MONEY TRANSMITTING BUSINESSES.
(a) UNIFORM LAWS AND ENFORCEMENT.—For pur-
poses of preventing money laundering and protecting the
payment system from fraud and abuse, it is the sense of
the Congress that the several States should—
(1) establish uniform laws for licensing and reg-
ulating businesses which—
(A) provide check cashing, currency ex-
change, or money transmitting or remittance
services, or issue or redeem money orders, travel-
ers’ checks, and other similar instruments; and
(B) are not depository institutions (as de-
fined in section 19(b)(1)(A) of the Federal Re-
serve Act); and
(2) provide sufficient resources to the appro-
priate State agency to enforce such laws and regula-
tions prescribed pursuant to such laws.
(b) MODEL STATUTE.—It is the sense of the Congress
that the several States should develop, through the auspices
of the National Conference of Commissioners on Uniform
State Laws, the American Law Institute, or such other
forum as the States may determine to be appropriate, a
model statute to carry out the goals described in subsection
(a) which would include the following:
(1) LICENSING REQUIREMENTS.—A requirement
that any business described in subsection (a)(1) be li-
censed and regulated by an appropriate State agency
in order to engage in any such activity within the
State.
(2) LICENSING
STANDARDS.—A requirement
that—
(A) in order for any business described in
subsection (a)(1) to be licensed in the State, the
appropriate State agency shall review and ap-
prove—
(i) the business record, the fee struc-
ture, and the capital adequacy of the busi-
ness seeking the license; and
(ii) the competence, experience, integ-
rity, and financial ability of any individ-
ual who—
(I) is a director, officer, or super-
visory employee of such business; or
(II) owns or controls such busi-
ness; and
(B) any record, on the part of any business
seeking the license or any person referred to in
subparagraph (A)(ii), of—
(i) any criminal activity;
(ii) any fraud or other act of personal
dishonesty;
(iii) any act, omission, or practice
which constitutes a breach of a fiduciary
duty; or
(iv) any suspension or removal, by any
agency or department of the United States
or any State, from participation in the con-
duct of any federally or State licensed or
regulated business,
may be grounds for the denial of any such li-
cense by the appropriate State agency.
(3) PROCEDURES TO ENSURE COMPLIANCE WITH
FEDERAL CASH TRANSACTION REPORTING REQUIRE-
MENTS.—A civil or criminal penalty for operating
any business referred to in paragraph (1) without es-
tablishing and complying with appropriate proce-
dures to ensure compliance with subchapter II of
chapter 53 of title 31, United States Code (relating to
records and reports on monetary instruments trans-
actions).
(4) CRIMINAL
PENALTIES
FOR
OPERATION
OF
BUSINESS WITHOUT A LICENSE.—A criminal penalty
for operating any business referred to in paragraph
(1) without a license within the State after the end
of an appropriate transition period beginning on the
date of the enactment of such model statute by the
State.
(c) STUDY REQUIRED.—The Secretary of the Treasury
shall conduct a study of—
(1) the progress made by the several States in de-
veloping and enacting a model statute which—
(A) meets the requirements of subsection (b);
and
(B) furthers the goals of—
(i) preventing money laundering by
businesses which are required to be licensed
under any such statute; and
(ii) protecting the payment system, in-
cluding the receipt, payment, collection, and
clearing of checks, from fraud and abuse by
such businesses; and
(2) the adequacy of—
the report submitted pursuant to subsection (d) shall con-
tain recommendations of the Secretary which are designed
to facilitate the enactment and enforcement by the State of
such a statute.
(f) FEDERAL FUNDING STUDY.—
(1) STUDY
REQUIRED.—The Secretary of the
Treasury shall conduct a study to identify possible
available sources of Federal funding to cover costs
which will be incurred by the States in carrying out
the purposes of this section.
(2) REPORT.—The Secretary of the Treasury
shall submit a report to the Congress on the study
conducted pursuant to paragraph (1) before the end
of the 18-month period beginning on the date of the
enactment of this Act.
SEC. 8. REGISTRATION OF MONEY TRANSMITTING BUSI-
NESSES TO PROMOTE EFFECTIVE LAW EN-
FORCEMENT.
(a) FINDINGS AND PURPOSES.—
(1) FINDINGS.—The Congress hereby finds the
following:
(A) Money transmitting businesses are sub-
ject to the recordkeeping and reporting require-
ments of subchapter II of chapter 53 of title 31,
United States Code.
(B) Money transmitting businesses are
largely unregulated businesses and are frequently
used in sophisticated schemes to—
(i) transfer large amounts of money
which are the proceeds of unlawful enter-
prises; and
(ii) evade the requirements of such sub-
chapter II, the Internal Revenue Code of
1986, and other laws of the United States.
(C) Information on the identity of money
transmitting businesses and the names of the
persons who own or control, or are officers or
employees of, a money transmitting business
would have a high degree of usefulness in crimi-
nal, tax, or regulatory investigations and pro-
ceedings.
(2) PURPOSE.—It is the purpose of this section
to establish a registration requirement for businesses
engaged in providing check cashing, currency ex-
change, or money transmitting or remittance services,
or issuing or redeeming money orders, travelers’
checks, and other similar instruments to assist the
Secretary of the Treasury, the Attorney General, and
other supervisory and law enforcement agencies to ef-
fectively enforce the criminal, tax, and regulatory
laws and prevent such money transmitting businesses
from engaging in illegal activities.
(b) IN GENERAL.—Subchapter II of chapter 53 of title
31, United States Code, is amended by adding at the end
the following new section:
‘‘§ 5329. Registration of money transmitting businesses
‘‘(a) REGISTRATION WITH SECRETARY OF THE TREAS-
URY REQUIRED.—
‘‘(1) IN
GENERAL.—Any person who owns or
controls a money transmitting business which is not
a depository institution (as defined in section
19(b)(1)(A) of the Federal Reserve Act) shall register
the business (whether or not the business is licensed
as a money transmitting business in any State) with
the Secretary of the Treasury before the end of the
180-day period beginning on the later of—
‘‘(A) the date of the enactment of the Money
Laundering Suppression Act of 1994; or
‘‘(B) the date the business is established.
‘‘(2) FORM AND MANNER OF REGISTRATION.—
Subject to the requirements of subsection (b), the Sec-
retary of the Treasury shall prescribe, by regulation,
the form and manner for registering a money trans-
mitting business pursuant to paragraph (1).
‘‘(3) BUSINESSES
REMAIN
SUBJECT
TO
STATE
LAW.—This section shall not be construed as supersed-
ing any requirement of State law relating to money
transmitting businesses operating in such State.
‘‘(4) FALSE AND INCOMPLETE INFORMATION.—
The filing of false or materially incomplete informa-
tion in connection with the registration of a money
transmitting business shall be considered as a failure
to comply with the requirements of this subchapter.
‘‘(b) CONTENTS OF REGISTRATION.—The registration
of a money transmitting business under subsection (a) shall
include the following information:
‘‘(1) The name and location of the business.
‘‘(2) The name and address of each person
who—
‘‘(A) owns or controls the business;
‘‘(B) is an director or officer of the business;
or
‘‘(C) otherwise participates in the conduct
of the affairs of the business.
‘‘(3) The name and address of any depository in-
stitution at which the business maintains a trans-
action account (as defined in section 19(b)(1)(C) of
the Federal Reserve Act).
‘‘(4) An estimate of the volume of business in the
coming year (which shall be reported annually to the
Secretary).
‘‘(5) Such other information as the Secretary of
the Treasury may require.
‘‘(c) AGENTS
OF
MONEY
TRANSMITTING
BUSI-
NESSES.—
‘‘(1) MAINTENANCE
OF
LISTS
OF
AGENTS
OF
MONEY
TRANSMITTING
BUSINESSES.—Pursuant to
regulations which the Secretary of the Treasury shall
prescribe, each money transmitting business shall—
‘‘(A) maintain a list containing the names
and addresses of all persons authorized to act as
an agent for such business in connection with ac-
tivities described in subsection (d)(1)(A) and
such other information about such agents as the
Secretary may require; and
‘‘(B) make the list and other information
available on request to any appropriate law en-
forcement agency.
‘‘(2) TREATMENT OF AGENT AS MONEY TRANS-
MITTING BUSINESS.—The Secretary of the Treasury
shall prescribe regulations establishing, on the basis of
such criteria as the Secretary determines to be appro-
priate, a threshold point for treating an agent of a
money transmitting business as a money transmit-
ting business for purposes of this section.
‘‘(d) DEFINITIONS.—For purposes of this section:
‘‘(1) MONEY
TRANSMITTING
BUSINESS.—The
term ‘money transmitting business’ means any busi-
ness other than the United States Postal Service
which—
‘‘(A) provides check cashing, currency ex-
change, or money transmitting or remittance
services, or issues or redeems money orders, trav-
elers’ checks, and other similar instruments;
‘‘(B) is required to file reports under section
5313; and
‘‘(C) is not a depository institution (as de-
fined in section 19(b)(1)(A) of the Federal Re-
serve Act).
‘‘(2) MONEY TRANSMITTING SERVICE.—The term
‘money transmitting service’ includes accepting cur-
rency or funds denominated in the currency of any
country and transmitting the currency or funds, or
the value of the currency or funds, by any means
through a financial agency or institution, a Federal
reserve bank or other facility of the Board of Gov-
ernors of the Federal Reserve System, or an electronic
funds transfer network.