‘‘(A) the disclosure does not contain infor-
mation which the institution, director, officer,
employee, or agent knows to be false; and
‘‘(B) the institution, director, officer, em-
ployee, or agent has not acted with malice or
with reckless disregard for the truth in making
the disclosure.
‘‘(2) DEFINITION.—For purposes of this sub-
section, the term ‘insured depository institution’ in-
cludes any uninsured branch or agency of a foreign
bank.’’.
SEC. 209. INTERNATIONAL COOPERATION ON IDENTIFICA-
TION OF ORIGINATORS OF WIRE TRANSFERS.
The Secretary of the Treasury shall—
(1) in consultation with the Attorney General
and the Secretary of State, take all reasonable steps
to encourage foreign governments to require the in-
clusion of the name of the originator in wire transfer
instructions sent to the United States and other
countries, with the information to remain with the
transfer from its origination until the point of dis-
bursement; and
(2) report annually to the Committee on Finan-
cial Services of the House of Representatives and
the Committee on Banking, Housing, and Urban Af-
fairs of the Senate on—
(A) progress toward the goal enumerated
in paragraph (1), as well as impediments to im-
plementation and an estimated compliance rate;
and
(B) impediments to instituting a regime in
which all appropriate identification, as defined
by the Secretary, about wire transfer recipients
shall be included with wire transfers from their
point of origination until disbursement.
SEC. 210. CHECK TRUNCATION STUDY.
Before the end of the 180-day period beginning on
the date of the enactment of this Act, the Secretary of
the Treasury, in consultation with the Attorney General
and the Board of Governors of the Federal Reserve Sys-
tem, shall conduct a study of the impact on—
(1) crime prevention (including money laun-
dering and terrorism);
(2) law enforcement;
(3) the financial services industry (including the
technical, operational, and economic impact on the
industry) and customers of such industry;
(4) the payment system (including the liquidity,
stability, and efficiency of the payment system and
the ability to monitor and access the flow of funds);
and
(5) the consumer protection laws,
of any policy of the Board of Governors of the Federal
Reserve System relating to the promotion of check
electronification, through truncation or other means, or
migration away from paper checks. The study shall also
include an analysis of the benefits and burdens of pro-
moting check electronification on the foregoing entities.
TITLE III—COMBATTING INTER-
NATIONAL 
MONEY 
LAUN-
DERING
SEC. 301. 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 of the United States, 1 or more
financial institutions operating outside of the United
States, 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States,
or 1 or more types of accounts is of primary money
laundering concern, in accordance with subsection
(c).
‘‘(2) FORM
OF
REQUIREMENT.—The special
measures described in—
‘‘(A) subsection (b) may be imposed in
such sequence or combination as the Secretary
shall determine;
‘‘(B) paragraphs (1) through (4) of sub-
section (b) may be imposed by regulation,
order, or otherwise as permitted by law; and
‘‘(C) subsection (b)(5) may be imposed
only by regulation.
‘‘(3) DURATION
OF
ORDERS; RULEMAKING.—
Any order by which a special measure described in
paragraphs (1) through (4) of subsection (b) is im-
posed (other than an order described in section
5326)—
‘‘(A) shall be issued together with a notice
of proposed rulemaking relating to the imposi-
tion of such special measure; and
‘‘(B) may not remain in effect for more
than 120 days, except pursuant to a regulation
prescribed on or before the end of the 120-day
period beginning on the date of issuance of
such order.
‘‘(4) PROCESS FOR SELECTING SPECIAL MEAS-
URES.—In selecting which special measure or meas-
ures to take under this subsection, the Secretary—
‘‘(A) shall consult with the Chairman of
the Board of Governors of the Federal Reserve
System, any other appropriate Federal banking
agency (as defined in section 3 of the Federal
Deposit Insurance Act), the Secretary of State,
the Securities and Exchange Commission, the
Commodity Futures Trading Commission, the
National Credit Union Administration Board,
and in the sole discretion of the Secretary such
other agencies and interested parties as the
Secretary may find to be appropriate; and
‘‘(B) 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, in-
cluding any undue cost or burden associ-
ated with compliance, for financial institu-
tions organized or licensed in the United
States;
‘‘(iii) the extent to which the action or
the timing of the action would have a sig-
nificant adverse systemic impact on the
international payment, clearance, and set-
tlement system, or on legitimate business
activities involving the particular jurisdic-
tion, institution, or class of transactions;
and
‘‘(iv) the effect on national security
and foreign policy.
‘‘(5) 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 of the United States, financial institution oper-
ating outside of the United States, class of transaction
within, or involving, a jurisdiction outside of the United
States, or 1 or more types of accounts are as follows:
‘‘(1) RECORDKEEPING
AND
REPORTING
OF
CERTAIN FINANCIAL TRANSACTIONS.—
‘‘(A) IN GENERAL.—The Secretary may re-
quire any domestic financial institution or do-
mestic financial agency to maintain records, file
reports, or both, concerning the aggregate
amount of transactions, or concerning each
transaction, with respect to a jurisdiction out-
side of the United States, 1 or more financial
institutions operating outside of the United
States, 1 or more classes of transactions within,
or involving, a jurisdiction outside of the United
States, or 1 or more types of accounts if the
Secretary finds any such jurisdiction, institu-
tion, or class of transactions 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, in accordance with such procedures
as the Secretary determines to be reason-
able and practicable to obtain and retain
the information; and
‘‘(iv) a description of any transaction.
‘‘(2) INFORMATION RELATING TO BENEFICIAL
OWNERSHIP.—In addition to any other requirement
under any other provision of law, the Secretary may
require any domestic financial institution or domes-
tic financial agency to take such steps as the Sec-
retary may determine to be reasonable and prac-
ticable to obtain and retain information concerning
the beneficial ownership of any account opened or
maintained in the United States by a foreign person
(other than a foreign entity whose shares are subject
to public reporting requirements or are listed and
traded on a regulated exchange or trading market),
or a representative of such a foreign person, that in-
volves a jurisdiction outside of the United States, 1
or more financial institutions operating outside of
the United States, 1 or more classes of transactions
within, or involving, a jurisdiction outside of the
United States, or 1 or more types of accounts if the
Secretary finds any such jurisdiction, institution,
transaction, or account to be of primary money laun-
dering concern.
‘‘(3) INFORMATION RELATING TO CERTAIN PAY-
ABLE-THROUGH ACCOUNTS.—If the Secretary finds
a jurisdiction outside of the United States, 1 or
more financial institutions operating outside of the
United States, or 1 or more classes of transactions
within, or involving, a jurisdiction outside of the
United States to be of primary money laundering
concern, the Secretary may require any domestic fi-
nancial institution or domestic financial agency that
opens or maintains a payable-through account in the
United States for a foreign financial institution in-
volving any such jurisdiction or any such financial
institution operating outside of the United States, or
a payable through account through which any such
transaction may be conducted, as a condition of
opening or maintaining such account—
‘‘(A) to 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) to obtain, with respect to each such
customer (and each such representative), infor-
mation that is substantially comparable to that
which the depository institution obtains in the
ordinary course of business with respect to its
customers residing in the United States.
‘‘(4) INFORMATION RELATING TO CERTAIN COR-
RESPONDENT ACCOUNTS.—If the Secretary finds a
jurisdiction outside of the United States, 1 or more
financial institutions operating outside of the United
States, or 1 or more classes of transactions within,
or involving, a jurisdiction outside of the United
States to be of primary money laundering concern,
the Secretary may require any domestic financial in-
stitution or domestic financial agency that opens or
maintains a correspondent account in the United
States for a foreign financial institution involving
any such jurisdiction or any such financial institu-
tion operating outside of the United States, or a cor-
respondent account through which any such trans-
action may be conducted, as a condition of opening
or maintaining such account—
‘‘(A) to identify each customer (and rep-
resentative of such customer) of any such finan-
cial institution who is permitted to use, or
whose transactions are routed through, such
correspondent account; and
‘‘(B) to obtain, with respect to each such
customer (and each such representative), infor-
mation that is substantially comparable to that
which the depository institution obtains in the
ordinary course of business with respect to its
customers residing in the United States.
‘‘(5) PROHIBITIONS OR CONDITIONS ON OPEN-
ING OR MAINTAINING CERTAIN CORRESPONDENT OR
PAYABLE-THROUGH
ACCOUNTS.—If the Secretary
finds a jurisdiction outside of the United States, 1
or more financial institutions operating outside of
the United States, or 1 or more classes of trans-
actions within, or involving, a jurisdiction outside of
the United States to be of primary money laun-
dering concern, the Secretary, in consultation with
the Secretary of State, the Attorney General, and
the Chairman of the Board of Governors of the Fed-
eral Reserve System, may prohibit, or impose condi-
tions upon, the opening or maintaining in the United
States of a correspondent account or payable-
through account by any domestic financial institu-
tion or domestic financial agency for or on behalf of
a foreign banking institution, if such correspondent
account or payable-through account involves any
such jurisdiction or institution, or if any such trans-
action may be conducted through such cor-
respondent account or payable-through account.
‘‘(c) CONSULTATIONS
AND INFORMATION TO BE
CONSIDERED IN FINDING JURISDICTIONS, INSTITUTIONS,
TYPES OF ACCOUNTS, OR TRANSACTIONS TO BE OF PRI-
MARY MONEY LAUNDERING CONCERN.—
‘‘(1) IN GENERAL.—In making a finding that
reasonable grounds exist for concluding that a juris-
diction outside of the United States, 1 or more fi-
nancial institutions operating outside of the United
States, 1 or more classes of transactions within, or
involving, a jurisdiction outside of the United States,
or 1 or more types of accounts is of primary money
laundering concern so as to authorize the Secretary
to take 1 or more of the special measures described
in subsection (b), the Secretary shall consult with
the Secretary of State, and the Attorney General.
‘‘(2) ADDITIONAL CONSIDERATIONS.—In mak-
ing a finding described in paragraph (1), the Sec-
retary shall consider in addition such information as
the Secretary determines to be relevant, including
the following potentially relevant factors:
‘‘(A) JURISDICTIONAL
FACTORS.—In the
case of a particular jurisdiction—
‘‘(i) evidence that organized criminal
groups, international terrorists, or both,
have transacted business in that jurisdic-
tion;
‘‘(ii) the extent to which that jurisdic-
tion or financial institutions operating in
that jurisdiction offer bank secrecy or spe-
cial regulatory advantages to nonresidents
or nondomiciliaries of that jurisdiction;
‘‘(iii) the substance and quality of ad-
ministration of the bank supervisory and
counter-money laundering laws of that ju-
risdiction;
‘‘(iv) the relationship between the vol-
ume of financial transactions occurring in
that jurisdiction and the size of the econ-
omy of the jurisdiction;
‘‘(v) the extent to which that jurisdic-
tion is characterized as an offshore bank-
ing or secrecy haven by credible inter-
national organizations or multilateral ex-
pert groups;
‘‘(vi) whether the United States has a
mutual legal assistance treaty with that ju-
risdiction, and the experience of United
States law enforcement officials, and regu-
latory officials in obtaining information
about transactions originating in or routed
through or to such jurisdiction; and
‘‘(vii) the extent to which that juris-
diction is characterized by high levels of of-
ficial or institutional corruption.
‘‘(B) INSTITUTIONAL
FACTORS.—In the
case of a decision to apply 1 or more of the spe-
cial measures described in subsection (b) only
to a financial institution or institutions, or to a
transaction or class of transactions, or to a type
of account, or to all 3, within or involving a
particular jurisdiction—
‘‘(i) the extent to which such financial
institutions, transactions, or types of ac-
counts are used to facilitate or promote
money laundering in or through the juris-
diction;
‘‘(ii) the extent to which such institu-
tions, transactions, or types of accounts
are used for legitimate business purposes
in the jurisdiction; and
‘‘(iii) the extent to which such action
is sufficient to ensure, with respect to
transactions involving the jurisdiction and
institutions operating in the jurisdiction,
that the purposes of this subchapter con-
tinue to be fulfilled, and to guard against
international money laundering and other
financial crimes.
‘‘(d) NOTIFICATION
OF SPECIAL MEASURES IN-
VOKED BY THE SECRETARY.—Not later than 10 days
after the date of any action taken by the Secretary under
subsection (a)(1), the Secretary shall notify, in writing,
the Committee on Financial Services of the House of Rep-
resentatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate of any such action.
‘‘(e) DEFINITIONS.—Notwithstanding any other pro-
vision of this subchapter, for purposes of this section, the
following definitions shall apply:
‘‘(1) BANK DEFINITIONS.—The following defini-
tions shall apply with respect to a bank:
‘‘(A) ACCOUNT.—The term ‘account’—
‘‘(i) means a formal banking or busi-
ness relationship established to provide
regular services, dealings, and other finan-
cial transactions; and
‘‘(ii) includes a demand deposit, sav-
ings deposit, or other transaction or asset
account and a credit account or other ex-
tension of credit.
‘‘(B) CORRESPONDENT
ACCOUNT.—The
term ‘correspondent account’ means an account
established to receive deposits from, make pay-
ments on behalf of a foreign financial institu-
tion, or handle other financial transactions re-
lated to such institution.
‘‘(C) PAYABLE-THROUGH ACCOUNT.—The
term ‘payable-through account’ means an ac-
count, including a transaction account (as de-
fined in section 19(b)(1)(C) of the Federal Re-
serve Act), opened at a depository institution by
a foreign financial institution by means of
which the foreign financial institution permits
its customers to engage, either directly or
through a subaccount, in banking activities
usual in connection with the business of bank-
ing in the United States.
‘‘(D) SECRETARY.—The term ‘Secretary’
means the Secretary of the Treasury.
‘‘(2) DEFINITIONS
APPLICABLE
TO
INSTITU-
TIONS OTHER THAN BANKS.—With respect to any fi-
nancial institution other than a bank, the Secretary
shall, after consultation with the appropriate Fed-
eral functional regulators (as defined in section 509
of the Gramm-Leach-Bliley Act), define by regula-
tion the term ‘account’, and shall include within the
meaning of that term, to the extent, if any, that the
Secretary deems appropriate, arrangements similar
to payable-through and correspondent accounts.
‘‘(3) REGULATORY
DEFINITION.—The Sec-
retary shall prescribe regulations defining beneficial
ownership of an account for purposes of this sub-
chapter. Such regulations shall address issues re-
lated to an individual’s authority to fund, direct, or
manage the account (including the power to direct
payments into or out of the account), and an indi-
vidual’s material interest in the income or corpus of
the account, and shall ensure that the identification
of individuals under this section does not extend to
any individual whose beneficial interest in the in-
come or corpus of the account is immaterial.
‘‘(4) OTHER TERMS.—The Secretary may, by
regulation, further define the terms in paragraphs
(1) and (2) and define other terms for the purposes
of this section, as the Secretary deems appro-
priate.’’.
(b) FINANCIAL INSTITUTIONS SPECIFIED IN SUB-
CHAPTER II OF CHAPTER 53 OF TITLE 31, UNITED
STATES CODE.—
(1) CREDIT
UNIONS.—Subparagraph (E) of
section 5312(2) of title 31, United States Code, is
amended to read as follows:
‘‘(E) any credit union;’’.
(2) FUTURES
COMMISSION
MERCHANT; COM-
MODITY TRADING ADVISOR; COMMODITY POOL OPER-
ATOR.—Section 5312 of title 31, United States
Code, is amended by adding at the end the following
new subsection:
‘‘(c) ADDITIONAL DEFINITIONS.—For purposes of
this subchapter, the following definitions shall apply:
‘‘(1) CERTAIN
INSTITUTIONS
INCLUDED
IN
DEFINITION.—The term ‘financial institution’ (as
defined in subsection (a)) includes the following:
‘‘(A) Any futures commission merchant,
commodity trading advisor, or commodity pool
operator registered, or required to register,
under the Commodity Exchange Act.’’.
(3) CFTC INCLUDED.—For purposes of this
Act and any amendment made by this Act to any
other provision of law, the term ‘‘Federal functional
regulator’’ includes the Commodity Futures Trading
Commission.
(c) CLERICAL AMENDMENT.—The table of sections
for subchapter II of chapter 53 of title 31, United States
Code, is amended by inserting after the item relating to
section 5318 the following new item:
‘‘5318A. Special measures for jurisdictions, financial institutions, or inter-
national transactions of primary money laundering concern.’’.
SEC. 302. SPECIAL DUE DILIGENCE FOR CORRESPONDENT
ACCOUNTS 
AND 
PRIVATE 
BANKING 
AC-
COUNTS.
(a) IN GENERAL.—Section 5318 of title 31, United
States Code, is amended by inserting after subsection (i)
(as added by section 119 of this Act) the following new
subsection:
‘‘(j) DUE DILIGENCE FOR UNITED STATES PRIVATE
BANKING AND CORRESPONDENT BANK ACCOUNTS IN-
VOLVING FOREIGN PERSONS.—
‘‘(1) IN GENERAL.—Each financial institution
that establishes, maintains, administers, or manages
a private banking account or a correspondent ac-
count in the United States for a non-United States
person, including a foreign individual visiting the
United States, or a representative of a non-United
States person, shall establish appropriate, specific,
and, where necessary, enhanced due diligence poli-
cies, procedures, and controls to detect and report
instances of money laundering through those ac-
counts.
‘‘(2) SPECIAL STANDARDS FOR CERTAIN COR-
RESPONDENT ACCOUNTS.—
‘‘(A) IN
GENERAL.—Subparagraph (B)
shall apply if a correspondent account is re-
quested or maintained by, or on behalf of, a
foreign bank operating—
‘‘(i) under an offshore banking li-
cense; or
‘‘(ii) under a banking license issued
by a foreign country that has been
designated—
‘‘(I) as noncooperative with inter-
national anti-money laundering prin-
ciples or procedures by an intergov-
ernmental group or organization of
which the United States is a member
with which designation the Secretary
of the Treasury concurs; or
‘‘(II) by the Secretary as war-
ranting special measures due to
money laundering concerns.
‘‘(B) POLICIES, PROCEDURES, AND
CON-
TROLS.—The enhanced due diligence policies,
procedures, and controls required under para-
graph (1) for foreign banks described in sub-
paragraph (A) shall, at a minimum, ensure that
the financial institution in the United States
takes reasonable steps—
‘‘(i) to ascertain for any such foreign
bank, the shares of which are not publicly
traded, the identity of each of the owners
of the foreign bank, and the nature and
extent of the ownership interest of each
such owner;
‘‘(ii) to conduct enhanced scrutiny of
such account to guard against money laun-
dering and report any suspicious trans-
actions under section 5318(g); and
‘‘(iii) to ascertain whether such for-
eign bank provides correspondent accounts
to other foreign banks and, if so, the iden-
tity of those foreign banks and related due
diligence information, as appropriate under
paragraph (1).
‘‘(3) MINIMUM STANDARDS FOR PRIVATE BANK-
ING ACCOUNTS.—If a private banking account is re-
quested or maintained by, or on behalf of, a non-
United States person, then the due diligence policies,
procedures, and controls required under paragraph
(1) shall, at a minimum, ensure that the financial
institution takes reasonable steps—
‘‘(A) to ascertain the identity of the nomi-
nal and beneficial owners of, and the source of
funds deposited into, such account as needed to
guard against money laundering and report any
suspicious transactions under section 5318(g);
and
‘‘(B) to conduct enhanced scrutiny of any
such account that is requested or maintained
by, or on behalf of, a senior foreign political fig-
ure, or any immediate family member or close
associate of a senior foreign political figure, to
prevent, detect, and report transactions that
may involve the proceeds of foreign corruption.
‘‘(4) DEFINITIONS.—For purposes of this sub-
section, the following definitions shall apply:
‘‘(A) OFFSHORE BANKING LICENSE.—The
term ‘offshore banking license’ means a license
to conduct banking activities which, as a condi-
tion of the license, prohibits the licensed entity
from conducting banking activities with the citi-
zens of, or with the local currency of, the coun-
try which issued the license.
‘‘(B) PRIVATE BANK ACCOUNT.—The term
‘private bank account’ means an account (or
any combination of accounts) that—
‘‘(i) requires a minimum aggregate
deposits of funds or other assets of not less
than $1,000,000;
‘‘(ii) is established on behalf of 1 or
more individuals who have a direct or ben-
eficial ownership interest in the account;
and
‘‘(iii) is assigned to, or is administered
or managed by, in whole or in part, an of-
ficer, employee, or agent of a financial in-
100
stitution acting as a liaison between the fi-
nancial institution and the direct or bene-
ficial owner of the account.
‘‘(5) REGULATORY
AUTHORITY.—Before the
end of the 6-month period beginning on the date of
the enactment of the Financial Anti-Terrorism Act
of 2001, the Secretary, in consultation with the ap-
propriate Federal functional regulators (as defined
in section 509 of the Gramm-Leach-Bliley Act) shall
further define and clarify, by regulation, the require-
ments of this subsection.’’.
(b) EFFECTIVE DATE.—The amendments made by
this section shall take effect beginning 180 days after the
date of the enactment of this Act with respect to accounts
covered by subsection (j) of section 5318 of title 31,
United States Code (as added by this section) that are
opened before, on, or after the date of the enactment of
this Act.
SEC. 
303. 
PROHIBITION 
ON 
UNITED 
STATES 
COR-
RESPONDENT 
ACCOUNTS 
WITH 
FOREIGN
SHELL BANKS.
Section 5318 of title 31, United States Code, is
amended by inserting after subsection (j) (as added by sec-
tion 302 of this title) the following new subsection:
101
‘‘(k) PROHIBITION
ON
UNITED
STATES
COR-
RESPONDENT
ACCOUNTS
WITH
FOREIGN
SHELL
BANKS.—
‘‘(1) IN
GENERAL.—A depository institution
shall not establish, maintain, administer, or manage
a correspondent account in the United States for, or
on behalf of, a foreign bank that does not have a
physical presence in any country.
‘‘(2) PREVENTION
OF
INDIRECT
SERVICE
TO
FOREIGN SHELL BANKS.—
‘‘(A) IN GENERAL.—A depository institu-
tion shall take reasonable steps to ensure that
any correspondent account established, main-
tained, administered, or managed by that insti-
tution in the United States for a foreign bank
is not being used by that foreign bank to indi-
rectly provide banking services to another for-
eign bank that does not have a physical pres-
ence in any country.
‘‘(B) REGULATIONS.—The Secretary shall,
in regulations, delineate reasonable steps nec-
essary for a depository institution to comply
with this subsection.
‘‘(3) EXCEPTION.—Paragraphs (1) and (2)
shall not be construed as prohibiting a depository in-
102
stitution from providing a correspondent account to
a foreign bank, if the foreign bank—
‘‘(A) is an affiliate of a depository institu-
tion, credit union, or other foreign bank that
maintains a physical presence in the United
States or a foreign country, as applicable; and
‘‘(B) is subject to supervision by a banking
authority in the country regulating the affili-
ated depository institution, credit union, or for-
eign bank, described in subparagraph (A), as
applicable.
‘‘(4) DEFINITIONS.—For purposes of this sec-
tion, the following definitions shall apply:
‘‘(A) AFFILIATE.—The term ‘affiliate’
means a foreign bank that is controlled by or
is under common control with a depository in-
stitution, credit union, or foreign bank.
‘‘(B) DEPOSITORY INSTITUTION.—The ‘de-
pository institution’—
‘‘(i) has the meaning given such term
in section 3 of the Federal Deposit Insur-
ance Act; and
‘‘(ii) includes a credit union.
103
‘‘(C) PHYSICAL
PRESENCE.—The term
‘physical presence’ means a place of business
that—
‘‘(i) is maintained by a foreign bank;
‘‘(ii) is located at a fixed address
(other than solely an electronic address) in
a country in which the foreign bank is au-
thorized to conduct banking activities, at
which location the foreign bank—
‘‘(I) employs 1 or more individ-
uals on a full-time basis; and
‘‘(II) maintains operating records
related to its banking activities; and
‘‘(iii) is subject to inspection by the
banking authority which licensed the for-
eign bank to conduct banking activities.’’.
SEC. 304. ANTI-MONEY LAUNDERING PROGRAMS.
(a) IN GENERAL.—Section 5318(h) of title 31,
United States Code, is amended to read as follows:
‘‘(h) ANTI-MONEY LAUNDERING PROGRAMS.—
‘‘(1) IN GENERAL.—In order to guard against
money laundering through financial institutions,
each financial institution shall establish anti-money
laundering programs, including, at a minimum—
104
‘‘(A) the development of internal policies,
procedures, and controls;
‘‘(B) the designation of an officer of the fi-
nancial institution responsible for compliance;
‘‘(C) an ongoing employee training pro-
gram; and
‘‘(D) an independent audit function to test
programs.
‘‘(2) REGULATIONS.—The Secretary may, after
consultation with the appropriate Federal functional
regulators (as defined in section 509 of the Gramm-
Leach-Bliley Act), prescribe minimum standards for
programs established under paragraph (1), and may
exempt from the application of those standards any
financial institution that is not subject to the provi-
sions of the regulations contained in part 103 of
title 31, of the Code of Federal Regulations, as in
effect on the date of the enactment of the Financial
Anti-Terrorism Act of 2001, or any successor to
such regulations, for so long as such financial insti-
tution is not subject to the provisions of such regula-
tions.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall take effect at the end of the 180-day
period beginning on the date of the enactment of this Act.
105
(c) DATE OF APPLICATION OF REGULATIONS; FAC-
TORS TO BE TAKEN INTO ACCOUNT.—Before the end of
the 180-day period beginning on the date of the enactment
of this Act, the Secretary of the Treasury shall prescribe
regulations to implement the amendment made by sub-
section (a). In prescribing such regulations, the Secretary
shall consider the extent to which the requirements im-
posed under such regulations are commensurate with the
size, location, and activities of the financial institutions
to which such regulations apply.
SEC. 305. CONCENTRATION ACCOUNTS AT FINANCIAL IN-
STITUTIONS.
Section 5318(h) of title 31, United States Code (as
amended by section 304) is amended by adding at the end
the following:
‘‘(3) CONCENTRATION
ACCOUNTS.—The Sec-
retary may prescribe regulations under this sub-
section that govern maintenance of concentration ac-
counts by financial institutions, in order to ensure
that such accounts are not used to prevent associa-
tion of the identity of an individual customer with
the movement of funds of which the customer is the
direct or beneficial owner, which regulations shall, at
a minimum—
106
‘‘(A) prohibit financial institutions from al-
lowing clients to direct transactions that move
their funds into, out of, or through the con-
centration accounts of the financial institution;
‘‘(B) prohibit financial institutions and
their employees from informing customers of
the existence of, or the means of identifying,
the concentration accounts of the institution;
and
‘‘(C) require each financial institution to
establish written procedures governing the doc-
umentation of all transactions involving a con-
centration account, which procedures shall en-
sure that, any time a transaction involving a
concentration account commingles funds belong-
ing to 1 or more customers, the identity of, and
specific amount belonging to, each customer is
documented.’’.
SEC. 306. INTERNATIONAL COOPERATION IN INVESTIGA-
TIONS OF MONEY LAUNDERING, FINANCIAL
CRIMES, AND THE FINANCES OF TERRORIST
GROUPS.
(a) NEGOTIATIONS.—
(1) IN GENERAL.—It is the sense of the Con-
gress that, in addition to the existing requirements
107
of section 4702 of the Anti-Drug Abuse Act of 1988,
the President should direct the Secretary of State,
the Attorney General, or the Secretary of the Treas-
ury, as appropriate and in consultation with the
Board of Governors of the Federal Reserve System,
to seek to enter into negotiations with the appro-
priate financial supervisory agencies and other offi-
cials of any foreign country the financial institutions
of which do business with United States financial in-
stitutions or which may be utilized by any foreign
terrorist organization (as designated under section
219 of the Immigration and Nationality Act), any
person who is a member or representative of any
such organization, or any person engaged in money
laundering or financial or other crimes.
(2) PURPOSES
OF
NEGOTIATIONS.—It is the
sense of the Congress that, in carrying out any ne-
gotiations described in paragraph (1), the President
should direct the Secretary of State, the Attorney
General, or the Secretary of the Treasury, as appro-
priate, to seek to enter into and further cooperative
efforts, voluntary information exchanges, the use of
letters rogatory, mutual legal assistance treaties,
and international agreements to—
108
(A) ensure that foreign banks and other fi-
nancial institutions maintain adequate records
of—
(i) large United States currency
transactions; and
(ii) transaction and account informa-
tion relating to any foreign terrorist orga-
nization (as designated under section 219
of the Immigration and Nationality Act),
any person who is a member or representa-
tive of any such organization, or any per-
son engaged in money laundering or finan-
cial or other crimes; and
(B) establish a mechanism whereby such records
may be made available to United States law enforce-
ment officials and domestic financial institution su-
pervisors, when appropriate.
(b) REPORTS.—
(1) IN GENERAL.—Not later than 1 year after
the date of the enactment of this Act and annually
thereafter, the Secretary of State, in conjunction
with the Attorney General and the Secretary of the
Treasury, shall submit a report to the Congress, on
the progress in any negotiations described in sub-
section (a).
109
(2) 
IDENTIFICATION
OF
CERTAIN
COUN-
TRIES.—In any report submitted under paragraph
(1), the Secretary of State shall identify countries—
(A) with respect to which the Secretary de-
termines there is evidence that the financial in-
stitutions in such countries are being utilized by
any foreign terrorist organization (as des-
ignated under section 219 of the Immigration
and Nationality Act), any person who is a mem-
ber or representative of any such organization,
or any person engaged in money laundering or
financial or other crimes; and
(B) which have not reached agreement
with United States authorities to meet the ob-
jectives of subparagraphs (A) and (B) of sub-
section (a)(2).
(3) REPORT ON PENALTIES AND SANCTIONS.—
If the President determines that—
(A) a foreign country is described in sub-
paragraphs (A) and (B) of paragraph (2); and
(B) such country—
(i) is not negotiating in good faith to
reach an agreement described in subsection
(a)(2); or
110
(ii) has not complied with, or a finan-
cial institution of such country has not
complied with, a request, made by an offi-
cial of the United States Government au-
thorized to make such request, for infor-
mation regarding a foreign terrorist orga-
nization (as designated under section 219
of the Immigration and Nationality Act), a
person who is a member or representative
of any such organization, or a person en-
gaged in money laundering for or with any
such organization,
and the President imposes any penalties or sanctions
on such country or financial institutions of such
country on the basis of such determination, the Sec-
retary of State shall submit a report to the Congress
describing the facts and circumstances of the case
before the end of the 60-day period beginning on the
date such sanctions and penalties take effect.
111
TITLE IV—CURRENCY
PROTECTION
SEC. 401. COUNTERFEITING DOMESTIC CURRENCY AND OB-
LIGATIONS.
(a) COUNTERFEIT ACTS COMMITTED OUTSIDE THE
UNITED STATES.—Section 470 of title 18, United States
Code, is amended—
(1) in paragraph (2), by inserting ‘‘analog, dig-
ital, or electronic image,’’ after ‘‘plate, stone,’’; and
(2) by striking ‘‘shall be fined under this title,
imprisoned not more than 20 years, or both’’ and in-
serting ‘‘shall be punished as is provided for the like
offense within the United States’’.
(b) OBLIGATIONS OR SECURITIES OF THE UNITED
STATES.—Section 471 of title 18, United States Code, is
amended by striking ‘‘fifteen years’’ and inserting ‘‘20
years’’.
(c) UTTERING COUNTERFEIT OBLIGATIONS OR SE-
CURITIES.—Section 472 of title 18, United States Code,
is amended by striking ‘‘fifteen years’’ and inserting ‘‘20
years’’.
(d) DEALING IN COUNTERFEIT OBLIGATIONS OR SE-
CURITIES.—Section 473 of title 18, United States Code,
is amended by striking ‘‘ten years’’ and inserting ‘‘20
years’’.
112
(e) PLATES, STONES, OR ANALOG, DIGITAL, OR
ELECTRONIC IMAGES FOR COUNTERFEITING OBLIGA-
TIONS OR SECURITIES.—
(1) IN GENERAL.—Section 474(a) of title 18,
United States Code, is amended by inserting after
the second paragraph the following new paragraph:
‘‘Whoever, with intent to defraud, makes, executes,
acquires, scans, captures, records, receives, transmits, re-
produces, sells, or has in such person’s control, custody,
or possession, an analog, digital, or electronic image of
any obligation or other security of the United States; or’’.
(2) AMENDMENT
TO
DEFINITION.—Section
474(b) of title 18, United States Code, is amended
by striking the first sentence and inserting the fol-
lowing new sentence: ‘‘For purposes of this section,
the term ‘analog, digital, or electronic image’ in-
cludes any analog, digital, or electronic method used
for the making, execution, acquisition, scanning,
capturing, recording, retrieval, transmission, or re-
production of any obligation or security, unless such
use is authorized by the Secretary of the Treasury.’’.
(3) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—The heading for section 474 of title 18,
United States Code, is amended by striking ‘‘or
113
stones’’ and inserting ‘‘, stones, or analog,
digital, or electronic images’’.
(4) CLERICAL AMENDMENT.—The table of sec-
tions for chapter 25 of title 18, United States Code,
is amended in the item relating to section 474 by
striking ‘‘or stones’’ and inserting ‘‘, stones, or ana-
log, digital, or electronic images’’.
(f) TAKING IMPRESSIONS OF TOOLS USED FOR OBLI-
GATIONS OR SECURITIES.—Section 476 of title 18, United
States Code, is amended—
(1) by inserting ‘‘analog, digital, or electronic
image,’’ after ‘‘impression, stamp,’’; and
(2) by striking ‘‘ten years’’ and inserting ‘‘25
years’’.
(g) POSSESSING
OR
SELLING
IMPRESSIONS
OF
TOOLS USED FOR OBLIGATIONS OR SECURITIES.—Sec-
tion 477 of title 18, United States Code, is amended—
(1) in the first paragraph, by inserting ‘‘analog,
digital, 
or 
electronic 
image,’’ 
after 
‘‘imprint,
stamp,’’;
(2) in the second paragraph, by inserting ‘‘ana-
log, digital, or electronic image,’’ after ‘‘imprint,
stamp,’’; and
(3) in the third paragraph, by striking ‘‘ten
years’’ and inserting ‘‘25 years’’.
114
(h) CONNECTING PARTS OF DIFFERENT NOTES.—
Section 484 of title 18, United States Code, is amended
by striking ‘‘five years’’ and inserting ‘‘10 years’’.
(i) BONDS AND OBLIGATIONS OF CERTAIN LENDING
AGENCIES.—The first and second paragraphs of section
493 of title 18, United States Code, are each amended
by striking ‘‘five years’’ and inserting ‘‘10 years’’.
SEC. 402. COUNTERFEITING FOREIGN CURRENCY AND OB-
LIGATIONS.
(a) FOREIGN OBLIGATIONS OR SECURITIES.—Sec-
tion 478 of title 18, United States Code, is amended by
striking ‘‘five years’’ and inserting ‘‘20 years’’.
(b) UTTERING COUNTERFEIT FOREIGN OBLIGA-
TIONS OR SECURITIES.—Section 479 of title 18, United
States Code, is amended by striking ‘‘three years’’ and
inserting ‘‘20 years’’.
(c) POSSESSING COUNTERFEIT FOREIGN OBLIGA-
TIONS OR SECURITIES.—Section 480 of title 18, United
States Code, is amended by striking ‘‘one year’’ and in-
serting ‘‘20 years’’.
(d) PLATES, STONES, OR ANALOG, DIGITAL, OR
ELECTRONIC IMAGES
FOR COUNTERFEITING FOREIGN
OBLIGATIONS OR SECURITIES.—
115
(1) IN
GENERAL.—Section 481 of title 18,
United States Code, is amended by inserting after
the second paragraph the following new paragraph:
‘‘Whoever, with intent to defraud, makes, executes,
acquires, scans, captures, records, receives, transmits, re-
produces, sells, or has in such person’s control, custody,
or possession, an analog, digital, or electronic image of
any bond, certificate, obligation, or other security of any
foreign government, or of any treasury note, bill, or prom-
ise to pay, lawfully issued by such foreign government and
intended to circulate as money; or’’.
(2) INCREASED
SENTENCE.—The last para-
graph of section 481 of title 18, United States Code,
is amended by striking ‘‘five years’’ and inserting
‘‘25 years’’.
(3) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—The heading for section 481 of title 18,
United States Code, is amended by striking ‘‘or
stones’’ and inserting ‘‘, stones, or analog,
digital, or electronic images’’.
(4) CLERICAL AMENDMENT.—The table of sec-
tions for chapter 25 of title 18, United States Code,
is amended in the item relating to section 481 by
striking ‘‘or stones’’ and inserting ‘‘, stones, or ana-
log, digital, or electronic images’’.
116
(e) FOREIGN BANK NOTES.—Section 482 of title 18,
United States Code, is amended by striking ‘‘two years’’
and inserting ‘‘20 years’’.
(f) 
UTTERING
COUNTERFEIT
FOREIGN
BANK
NOTES.—Section 483 of title 18, United States Code, is
amended by striking ‘‘one year’’ and inserting ‘‘20 years’’.
SEC. 403. PRODUCTION OF DOCUMENTS.
Section 5114(a) of title 31, United States Code (re-
lating to engraving and printing currency and security
documents), is amended—
(1) by striking ‘‘(a) The Secretary of the Treas-
ury’’ and inserting:
‘‘(a) AUTHORITY TO ENGRAVE AND PRINT.—
‘‘(1) IN
GENERAL.—The Secretary of the
Treasury’’; and
(2) by adding at the end the following new
paragraph:
‘‘(2) ENGRAVING
AND
PRINTING
FOR
OTHER
GOVERNMENTS.—The Secretary of the Treasury
may, if the Secretary determines that it will not
interfere with engraving and printing needs of the
United States, produce currency, postage stamps,
and other security documents for foreign govern-
ments, subject to a determination by the Secretary
117
of State that such production would be consistent
with the foreign policy of the United States.’’.
SEC. 404. REIMBURSEMENT.
Section 5143 of title 31, United States Code (relating
to payment for services of the Bureau of Engraving and
Printing), is amended—
(1) in the first sentence, by inserting ‘‘, any for-
eign government, or any territory of the United
States’’ after ‘‘agency’’;
(2) in the second sentence, by inserting ‘‘and
other’’ after ‘‘administrative’’; and
(3) in the last sentence, by inserting ‘‘, foreign
government, or territory of the United States’’ after
‘‘agency’’.
Passed the House of Representatives October 17,
2001.
Attest:
Clerk.