What Is the Bank Secrecy Act (BSA)? Also known as the Currency and Foreign Transactions Reporting Act, the Bank Secrecy Act (BSA) is U.S. legislation created in 1970 to prevent financial institutions from being used as tools by criminals to hide or launder their ill-gotten gains.
What is the primary purpose of BSA?
Under the Bank Secrecy Act (BSA), financial institutions are required to assist U.S. government agencies in detecting and preventing money laundering , such as: Keep records of cash purchases of negotiable instruments, File reports of cash transactions exceeding $10,000 (daily aggregate amount), and.
What is the purpose of the Bank Secrecy Act of 1970?
The Currency and Foreign Transactions Reporting Act of 1970 (which legislative framework is commonly referred to as the “Bank Secrecy Act” or “BSA”) requires U.S. financial institutions to assist U.S. government agencies to detect and prevent money laundering.
What is the intent of BSA?
5311 et seq.) is referred to as the Bank Secrecy Act (BSA). The purpose of the BSA is to require United States (U.S.) financial institutions to maintain appropriate records and file certain reports involving currency transactions and a financial institution’s customer relationships .
What is the purpose of a monetary instrument log?
A Monetary Instrument Log (MIL) is a record financial institutions are required to keep that details customer purchases of monetary instruments valued between $3,000 and $10,000 . It is a requirement of the Bank Secrecy Act (BSA).
Who is exempt from BSA?
A non-listed business is one that is not publicly traded on a major stock exchange . In order to be eligible for exemption, the company must maintain a transaction account for two months, have at least eight large currency transactions over a year, and must be eligible to do business within the United States.
Who must comply with BSA?
The law requires banks and other financial institutions to provide documentation, such as currency transaction reports, to regulators. Such documentation can be required from banks whenever their clients deal with suspicious cash transactions involving sums of money in excess of $10,000.
Who is the Bank Secrecy Act enforced by?
The Bank Secrecy Act is administered by the Financial Crimes Enforcement Network (Fincen) which imposes a variety of compliance obligations on financial institutions.
What is the difference between BSA and AML?
Congress passed the Bank Secrecy Act (BSA), also known as the Anti-Money Laundering (AML) law, in 1970 to combat money laundering in the United States. Financial institutions must keep detailed records and report suspicious activity that could indicate money laundering or other crimes. ...
What are the five pillars of Bank Secrecy Act?
Currently, institutional AML programs are based on the “five pillars”: internal policies, procedures and controls; designation of an AML officer; employee training; independent testing; and customer due diligence (CDD) .
What is a BSA compliance officer responsible for?
The BSA compliance officer is responsible for coordinating and monitoring day-to-day BSA/AML compliance . The BSA compliance officer is also charged with managing all aspects of the BSA/AML compliance program, including managing the bank’s compliance with BSA regulatory requirements.
What is BSA training?
Bank Secrecy Act Training Requirements. Training is a core requirement of a satisfactory Bank Secrecy Act and Anti-Money Laundering (BSA/AML) compliance program. 1 . At a minimum, a BSA/AML training program must provide training for all personnel whose duties require knowledge of the BSA.
What is a BSA audit?
Objective: Assess the adequacy of the bank’s independent testing program. The purpose of independent testing (audit) is to assess the bank’s compliance with BSA regulatory requirements, relative to its risk profile , and assess the overall adequacy of the BSA/AML compliance program.
What is a CTR form also known as?
A currency transaction report (CTR) is a bank form used in the United States to help prevent money laundering. This form must be filled out by a bank representative whenever a customer attempts a currency transaction of more than $10,000.
Are monetary instruments high risk?
Additionally, transactions that are processed quickly (i.e. electronically) such as wire transfers, or are difficult to trace such as cash or negotiable instruments (e.g., monetary instruments, drafts, bearer securities, stored-value cards) also are high-risk activities for money laundering .
Is Bitcoin a monetary instrument?
Is a cryptocurrency a financial instrument? Cryptocurrencies are not financial instruments under U.S. GAAP because they do not represent cash or a contract establishing a right or obligation to deliver or receive cash or another financial instrument.
