Section 352 of the USA PATRIOT Act, Pub. L. 107‑56, amends the Bank Secrecy Act to require specified financial institutions (as defined in the BSA) to establish and maintain anti‑money laundering programs. The Financial Crimes Enforcement Network (FinCEN), the agency to which the Secretary of the Treasury has delegated the authority to administer the BSA, and the Department of the Treasury have issued final rules prescribing requirements for, inter alia, banks, savings associations, credit unions, money services businesses, mutual funds and operators of a credit card system. Several other categories of financial institutions were exempted by regulation from compliance with the anti‑money laundering program requirement until October 24, 2002. The exempted businesses include:

    • Dealers in precious metals, stones or jewels;

    • Loan or finance companies;

    • Travel agencies;

    • Sellers of vehicles, including automobiles, airplanes and boats;

    • Persons involved in real estate closings and settlements;

    • Private bankers;

    • Insurance companies;

    • Commodity pool operators;

    • Commodity trading advisors; and

    • Investment companies.

    FinCEN and Treasury have now issued proposed rules that would apply to insurance companies and certain investment companies, but are continuing to study the money laundering risks posed by the other deferred businesses. Accordingly, the October 24, 2002 compliance deadline has been lifted and these business do not need to implement anti‑money laundering programs until final rules are issued. FinCEN and Treasury expect to issue proposed rules for all the remaining businesses within the next six months.

    If you would like additional information regarding this Alert, or if we can be of assistance in drafting or reviewing Bank Secrecy Act or anti‑money laundering policies, please contact Darrell Dreher at (614) 628-1601 or [email protected] .