Which is a valid extraterritorial effect of the USA PATRIOT Act?

The correct answer is C. Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a. Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country. The USA PATRIOT Act has an extraterritorial effect in that it prohibits broker-dealers from having correspondent accounts with foreign banks that do not…

Compliance Standards (International AML/CFT Standards and the role of FATF)

Question

Options

AForeign branches of US banks can maintain correspondent accounts with banks that do not have
BFinancial institutions are allowed to specifically direct client transactions that move their funds
CBroker-dealers cannot have correspondent accounts with a foreign bank that does not have a
DAny deposits into foreign banks are not considered to have been deposited into any interbank

How the community answered

(55 responses)

A
2% (1)
B
5% (3)
C
82% (45)
D
11% (6)

Explanation

Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country. The USA PATRIOT Act has an extraterritorial effect in that it prohibits broker-dealers from having correspondent accounts with foreign banks that do not have a physical presence in any country. This rule is designed to help prevent money laundering and terrorist financing by making it more difficult for funds to be moved to or through jurisdictions with less stringent anti-money laundering laws.

Topics

#USA PATRIOT Act#extraterritorial jurisdiction#correspondent banking#broker-dealers

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