The financial industry is under increasing pressure to take steps to combat terrorism and money laundering. In addition, the growth of fraudulent transactions, particularly identity theft, is taking a toll on the bottom lines of both consumers and the financial industry that serves them.

To assist our clients in understanding the issues associated with Financial Crime, Truth Technologies has prepared the following resources:

  • Current Regulations – Continue reading here for the latest regulations that affect your institution.
  • Financial Crimes– Review the Financial Crimes section for general overviews of money laundering and fraud.
  • Case Studies - To understand the dangers your institution faces, look at our case studies which highlight those unfortunate situations deficiencies resulted in fines and a battered reputation.
  • Links– Review our links to other Financial Crime Resources.


USA Patriot Act – Passed in 2001 (html | pdf)

The USA Patriot Act states that each financial institution shall establish anti-money laundering programs, including, at a minimum;

  • Development of internal policies, procedures, and controls
  • Designation of a compliance officer
  • Ongoing employee training program
  • An independent audit function to test programs

A firm, as part of its anti-money laundering program, should adopt a broad statement that clearly sets forth the firm’s policy against money laundering and any activity which facilitates money laundering or the funding of terrorist or criminal activities. This policy should emphasize the responsibility of every employee and should set forth the consequences of non-compliance.

The Patriot Act puts special emphasis on the importance of financial institutions knowing their customers. According to the act, for each account opened, a firm must undertake reasonable efforts to obtain and maintain certain information to ascertain the identity of its prospective client. Therefore, all financial institutions must develop a Customer Identification Program (CIP) to combat money laundering. The form of this program is dependent on the size of the firm, it’s location, and the nature of its business activities and it must be incorporated into the institution’s BSA.

Click here for more information about the Patriot Act

3rd EU Directive on the Prevention of Money Laundering - Passed in 2005, yet to be implemented (html)

This legislation is based on the FATF standards and is similar to the Patriot Act. The legislations emphasizes three key items:

  • Customer Due Diligence (CDD) - Identification of your customer and its beneficial owner
  • Report suspicious activity to national FIU office
  • Monitor customer transactions on a risk sensitive basis

Money Laundering Suppression Act - Passed in 1994

This piece of legislation was designed to reduce the number of Currency Transaction Reports (CTRs) by about 30 percent annually, by mandating certain exemptions. This Act also requires federal registration of all non-banking money transmitters, or business enterprises that cash checks, transmit money, or exchange currency.

Annunzio-Wylie Anti-Money Laundering Act - Passed in 1992

This Act requires financial institutions to have compliance procedures and staff training. Bank charters can be revoked, or their coverage by the Federal Deposit Insurance Corporation (FDIC) can be terminated, if they are convicted of non-compliance. These sanctions are so powerful that, according to bank regulators, they are unlikely to be sought often.

Anti-Drug Abuse Act - Passed in 1988

This legislation reinforced anti-money laundering efforts in several ways, foremost by significantly increasing civil, criminal, and forfeiture sanctions for laundering crimes and BSA violations. In particular, this Act allows for the seizure of any property, real or personal, involved in a transaction or attempted transaction in violation of laws relating to the filing of Currency Transaction Reports (CTRs), money laundering, or structuring transactions. This Act also requires strict identification and recording of cash purchases of certain monetary instruments. It permits the Treasury Department to require financial institutions to file additional, geographically-targeted reports. Another key-point of this legislation is that it empowered the Treasury Department to negotiate bilateral international agreements covering the recording of large U.S. currency transactions and the sharing of such information. Lastly, this Act increased the criminal sanction for tax evasion when money from a criminal activity is involved.

Money Laundering Control Act - Passed in 1986

This is part of the Anti-Drug Abuse Act (below) which made money-laundering a federal crime. It created three new criminal offenses for money laundering activities by, through, or to a financial institution. These offenses are: knowingly helping launder money from criminal activity; knowingly engaging (including being willfully blind) in a transaction of more than $10,000 that involves property from a criminal activity; and, structuring transactions to avoid Bank Secrecy Act reporting.

Bank Secrecy Act - Passed in 1970

This was designed to deter laundering and the use of secret foreign bank accounts. It also creates an investigative paper trail for large currency transactions by establishing regulatory reporting standards and requirements. The BSA imposes civil and criminal penalties for non-compliance with its reporting requirements while improving detection and investigation of criminal, tax, and regulatory violations.