I
106TH CONGRESS
2D SESSION
H. R. 3886
To combat international money laundering, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 9, 2000
Mr. LEACH (for himself, Mr. LAFALCE, Mrs. ROUKEMA, and Mr. VENTO) in-
troduced the following bill; which was referred to the Committee on
Banking and Financial Services
A BILL
To combat international money laundering, 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
‘‘International Counter-Money Laundering Act of 2000’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
TITLE I—INTERNATIONAL COUNTER-MONEY LAUNDERING
MEASURES
Sec. 101. Special measures for jurisdictions, financial institutions, or inter-
national transactions of primary money laundering concern.
TITLE II—CURRENCY TRANSACTION REPORTING AMENDMENTS
AND RELATED IMPROVEMENTS
Sec. 201. Amendments relating to reporting of suspicious activities.
Sec. 202. Penalties for violations of geographic targeting orders and certain
recordkeeping requirements, and lengthening effective period of
geographic targeting orders.
Sec. 203. Authorization to include suspicions of illegal activity in written em-
ployment references.
SEC. 2. FINDINGS AND PURPOSES.
(a) FINDINGS.—The Congress finds as follows:
(1) International money laundering provides the
financial fuel that permits international criminal en-
terprises to conduct and expand their operations to
the detriment of the safety and security of American
citizens.
(2) Money launderers subvert legitimate finan-
cial mechanisms and banking relationships by using
them as protective covering for the movement of
criminal proceeds and, by so doing, can undermine
the integrity of our financial institutions and of the
global financial and trading systems upon which our
prosperity and growth depend.
(3) Money launderers rely upon the existence
and use of certain jurisdictions outside the United
States that offer bank secrecy and special tax or
regulatory advantages to nonresidents, and often
complement those advantages with weak financial
supervisory and regulatory regimes.
(4) Certain kinds of transactions involving such
offshore jurisdictions—for example, those trans-
actions specifically designed to offer anonymity or
the avoidance of regulatory scrutiny—make it even
more difficult for law enforcement and regulators to
follow the trail of money earned by criminals who
traffic in human misery, whether they are narcotics
dealers, pornographers, terrorists, arms smugglers,
or those whose frauds prey upon law abiding citi-
zens.
(5) Certain banking relationships between fi-
nancial institutions in the United States and finan-
cial institutions located in such offshore jurisdic-
tions, such as correspondent and payable-through
accounts, are particularly vulnerable to abuse be-
cause of the difficulty in obtaining accurate informa-
tion about the beneficial owners whose funds pass
through such accounts.
(6) The ability to mount effective counter-meas-
ures to international money launderers requires na-
tional, as well as bilateral and multilateral action,
using tools specially designed for that use.
(b) PURPOSES.—The purposes of this Act are as fol-
lows:
(1) To ensure that banking transactions and fi-
nancial relationships, the conduct of such trans-
actions and relationships, or both, do not contravene
the purposes of subchapter II of chapter 53 of title
31, United States Code, section 21 of the Federal
Deposit Insurance Act, and chapter 2 of title I of
Public Law 91–508, or facilitate the evasion of any
such provision, to ensure that the purposes of such
subchapter II continue to be fulfilled, and to guard
against international money laundering and other fi-
nancial crimes.
(2) To provide a clear national mandate for
subjecting to special scrutiny those foreign jurisdic-
tions, financial institutions operating outside the
United States, and classes of international trans-
actions that pose particular, identifiable opportuni-
ties for money laundering.
(3) To provide the Secretary of the Treasury
with broad discretionary authority to take certain
measures tailored to the particular money laun-
dering problems presented by specific foreign juris-
dictions, financial institutions operating outside the
United States, and classes of international trans-
actions.
(4) To provide domestic financial institutions
with guidance on which foreign jurisdictions, finan-
cial institutions operating outside the United States,
and classes of international transactions are of pri-
mary money laundering concern to the United States
government.
(5) To encourage the filing of suspicious activ-
ity reports by financial institutions by improving the
terms of the safe harbor from civil liability for filing
such reports.
(6) To strengthen the Secretary’s authority to
issue and administer geographic targeting orders,
and to clarify that violations of such orders or any
other requirement imposed under the authority con-
tained in chapter 2 of title I of Public Law 91–508
and subchapters II and III of chapter 53 of title 31,
United States Code, may result in criminal and civil
penalties.
(7) To strengthen the ability of financial insti-
tutions to maintain the integrity of their employee
population.
TITLE I—INTERNATIONAL COUN-
TER–MONEY 
LAUNDERING
MEASURES
SEC. 101. SPECIAL MEASURES FOR JURISDICTIONS, FINAN-
CIAL 
INSTITUTIONS, 
OR 
INTERNATIONAL
TRANSACTIONS OF PRIMARY MONEY LAUN-
DERING CONCERN.
(a) IN GENERAL.—Subchapter II of chapter 53 of
title 31, United States Code, is amended by inserting after
section 5318 the following new section:
‘‘§ 5318A. Special measures for jurisdictions, financial
institutions, or international transactions
of primary money laundering concern
‘‘(a) 
INTERNATIONAL
COUNTER-MONEY
LAUN-
DERING REQUIREMENTS.—
‘‘(1) IN GENERAL.—The Secretary may require
domestic financial institutions and domestic financial
agencies to take 1 or more of the special measures
described in subsection (b) if the Secretary finds
that reasonable grounds exist for concluding that a
jurisdiction outside the United States, 1 or more fi-
nancial institutions operating outside the United
States, or 1 or more classes of transactions within
or involving a jurisdiction outside the United States
is of primary money laundering concern, in accord-
ance with subsection (c).
‘‘(2) FORM
OF
REQUIREMENT.—The special
measures described in subsection (b) may be im-
posed by regulation, order, or otherwise as permitted
by law, and in such sequence or combination, as the
Secretary shall determine.
‘‘(3) PROCESS.—
‘‘(A) IN
GENERAL.—In selecting which
special measure or measures to take under this
subsection, the Secretary shall consult with the
Chairman of the Board of Governors of the
Federal Reserve System.
‘‘(B) FACTORS.—The Secretary also shall
consider—
‘‘(i) whether similar action has been
or is being taken by other nations or multi-
lateral groups;
‘‘(ii) whether the imposition of any
particular special measure would create a
significant competitive disadvantage for fi-
nancial 
institutions 
organized 
in 
the
United States; and
‘‘(iii) the extent to which the action
would have a significant adverse systemic
impact on the international payment, clear-
ance and settlement system, or on legiti-
mate business activities involving the par-
ticular jurisdiction.
‘‘(4) NO LIMITATION ON OTHER AUTHORITY.—
This section shall not be construed as superseding or
otherwise restricting any other authority granted to
the Secretary, or to any other agency, by this sub-
chapter or otherwise.
‘‘(b) SPECIAL MEASURES.—The special measures re-
ferred to in subsection (a), with respect to a jurisdiction
outside the United States, financial institution operating
outside the United States, or class of transaction within
or involving a jurisdiction outside the United States, are
as follows:
‘‘(1) RECORDKEEPING
AND
REPORTING
OF
CERTAIN FINANCIAL TRANSACTIONS.—
‘‘(A) IN GENERAL.—The Secretary may re-
quire a domestic financial institution or domes-
tic financial agency to maintain records, file re-
ports, or both, concerning the aggregate
amount of transactions, or concerning each
transaction, with respect to a jurisdiction out-
side the United States, 1 or more financial in-
stitutions operating outside the United States,
or 1 or more classes of transactions within or
involving a jurisdiction outside the United
States, if the Secretary finds any such jurisdic-
tion, institution, or transaction to be of primary
money laundering concern.
‘‘(B) FORM OF RECORDS AND REPORTS.—
Such records and reports shall be made and re-
tained at such time, in such manner, and for
such period of time, as the Secretary shall de-
termine, and shall include such information as
the Secretary may determine, including—
‘‘(i) the identity and address of the
participants in a transaction or relation-
ship, including the identity of the origi-
nator of any funds transfer;
‘‘(ii) the legal capacity in which a par-
ticipant in any transaction is acting;
‘‘(iii) the identity of the beneficial
owner of the funds involved in any trans-
action; and
‘‘(iv) a description of any transaction.
‘‘(2) 
IDENTIFICATION
OF
BENEFICIAL
OWNER.—The Secretary may require any domestic
financial institution or domestic financial agency to
obtain and retain information concerning the iden-
tity of each beneficial owner, and any agent of such
beneficial owner, of any account opened or main-
tained in the United States by a foreign person
(other than a foreign entity some or all of whose
shares are publicly-traded), or a representative of
such a foreign person, that involves a jurisdiction
outside the United States, 1 or more financial insti-
tutions operating outside the United States, or 1 or
more classes of transactions within or involving a ju-
risdiction outside the United States, if the Secretary
finds any such jurisdiction, institution, or trans-
action to be of primary money laundering concern.
‘‘(3) INFORMATION RELATING TO CERTAIN PAY-
ABLE-THROUGH ACCOUNTS.—If the Secretary finds
a jurisdiction outside the United States, 1 or more
financial institutions operating outside the United
States, or 1 or more classes of transactions within
or involving a jurisdiction outside the United States
to be of primary money laundering concern, the Sec-
retary may require any domestic financial institution
or domestic financial agency that opens or maintains
a payable-through account in the United States for
a foreign financial institution involving any such ju-
risdiction or any such financial institution operating
outside the United States, or a payable-through ac-
count through which any such transaction may be
conducted, as a condition of opening or maintaining
such account, to—
‘‘(A) identify each customer (and rep-
resentative of such customer) of such financial
institution who is permitted to use, or whose
transactions are routed through, such payable-
through account; and
‘‘(B) obtain, with respect to each such cus-
tomer (and each such representative), the same
information that the depository institution ob-
tains in the ordinary course of business with re-
spect to customers residing in the United
States.
‘‘(4) INFORMATION RELATING TO CERTAIN COR-
RESPONDENT ACCOUNTS.—If the Secretary finds a
jurisdiction outside the United States, 1 or more fi-
nancial institutions operating outside the United
States, or 1 or more classes of transactions within
or involving a jurisdiction outside the United States
to be of primary money laundering concern, the Sec-
retary may require any domestic financial institution
or domestic financial agency that opens or maintains
a correspondent account in the United States for a
foreign financial institution involving any such juris-