Bank Secrecy Act (BSA) Regulations - Country Advisories

Gregory J. Cook, EA, CPA+ Accredited Tax Advisor Past President Alabama Society of Enrolled Agents Past President Alabama Association of Accountants

International Money Laundering Efforts

The United States is not alone in the fight against financial crimes. Many countries have enacted significant anti-money laundering legislation. A number of international organizations and regional groups have adopted anti-money laundering rules and regulations as well.

Basel Committee

The Basel Committee consists of representatives of central banks and supervisory authorities of Belgium, Canada, France, Germany, Italy, Japan, Luxembourg, the Netherlands, Spain, Sweden, Switzerland, the United Kingdom and the USA. In 1988 the Basel Committee published a “Statement of Principles” on money laundering, which generally recommended obtaining proper identification from customers and complying with laws and regulations governing financial transactions.

United Nations (UN)

The UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (the Vienna Convention) calls on signatories to criminalize money laundering, to assure that bank secrecy is not a barrier to criminal investigations, and to promote removal of legislative barriers to investigation, prosecution, and international cooperation.

Financial Action Task Force (FATF)

FATF was created at the Economic Summit of the major industrialized countries in 1989. It issued a report in which it made 40 recommendations, consistent with the Vienna Convention, for implementing and coordinating money laundering laws in member countries. They also formed the basis of money laundering rules and regulations established by the Caribbean Financial Action Task Force and the Organization of America States.

Another report FATF has issued on non-cooperative countries and territories identifies countries with detrimental rules and practices that obstruct international cooperation in the fight against money laundering.


European Union (EU)

In 1991, the EU issued a directive on money laundering, compatible with the original 40 FATF recommendations. It requires mandatory reporting of suspicious transactions and identification of beneficial owners and customers of financial transactions and accounts.

Country Advisories and Economic and Trade Sanction Lists

FinCEN Advisories

FinCEN has issued country advisories urging enhanced scrutiny of financial transactions with countries that had deficient anti-money laundering controls. Advisories can be viewed at www.fincen.gov under Publications/Advisories.

Office of Foreign Assets Control (OFAC) List

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issues the Specially Designated Nationals and Blocked Entities List (SDN List). OFAC regulations required businesses to identify and freeze and the assets of targeted countries, terrorists, drug cartels and other specially designated persons. For these lists and specific instructions regarding what businesses may or may not do under OFAC regulations, refer to the OFAC website at: www.ustreas.gov/ofac.