Michele Sciurba - Anti-Money Laundering State Mechanisms

16Money Laundering Control Act of 1986 (Pub. L. 99-570).

17MJ Anderson and TA Anderson, ‘Anti-Money Laundering: History and Current Developments’ (2015) JIBLR 30(10) 523 f.

18R Quedenfeld, ‘Grundlagen der Geldwäschebekämpfung’ in R Quedenfeld (ed), Handbuch: Bekämpfung der Geldwäsche und Wirtschaftskriminalität (4th edn, ESV 2017) 23. – The fight against criminal organisations that operate all over the world, especially drug cartels, has required cross-border cooperation among all states. This led to the adoption of the UN Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances in 1988 and the founding of the Financial Action Task Force (FATF) in 1989 with its 40 recommendations on combating money laundering issued in 1990.

19D Cox, Handbook of Anti-Money Laundering (1st edn, Wiley 2014) 687.

20EJ Gouvin, ‘Bringing out the Big Guns: the USA PATRIOT ACT, Money Laundering, and the War on Terrorism’ (2003) Baylor L Rev 55, 964.

21In Germany, for example, bank secrecy towards investigating authorities, courts or other authorities has been lifted with the introduction of §24c of the Banking Act (KWG) in 2005. These authorities can access the customers’ account data at any time without their knowledge. Comparable legislation has been implemented across the G20 countries. See N Johannesen and G Zucman, ‘The End of Bank Secrecy? An Evaluation of the G20 Tax Haven Crackdown’ (2014) American Economic Journal: Economic Policy 6(1) 66 ff.

22See the Comprehensive Crime Control Act 1984 (Pub. L. 98-473) and the Anti-Drug Abuse Act of 1988 (Pub. L. 100-690). – The Comprehensive Crime Control Act provides a number of additional tools that enable investigators to take actions against drug trafficking, including money laundering, and corrupt organisations. The Anti-Drug Abuse Act classifies also car dealers and real estate closing agents as financial institutions and obliges them to report transactions above USD 3,000. See further MJ Anderson and TA Anderson, ‘Anti-Money Laundering: History and Current Developments’ (2015) JIBLR 30(10) 523 ff.

23See the Annunzio-Wylie Anti-Money Laundering Act of 1992 (Pub. L. 102-550), the Money Laundering Suppression Act of 1994 and the Money Laundering and Financial Strategy Act of 1998 (Pub. L. 105-310). – The Annunzio-Wylie Anti-Money Laundering Act has resulted in a significant expansion of powers in the fight against money laundering and established the Bank Secrecy Act Advisory Group (BSAAG), which consists of 30 members who advise the Treasury Department on the development of AML programs. Furthermore, the Act provides whistle-blower immunity for financial institutions filing SARs. The Money Laundering Suppression Act aims to strengthen the control of money service businesses (MSBs) and expands the concept of financial institutions. For this extended group, immunity applies as well. The Money Laundering and Financial Strategy Act requires the Department of Treasury and other authorities to develop national AML strategies. See MJ Anderson and TA Anderson, ‘Anti-Money Laundering: History and Current Developments’ (2015) JIBLR 30(10) 524 f.

24Financial Crimes Enforcement Network (FinCEN), ‘BSA Timeline’ < https://www.fincen.gov/resources/statutes-and-regulations/bank-secrecy-act/bsa-timeline> accessed 26 August 2017.

25JW Moscow, ‘USA’ in WH Muller, CH Kalin & JG Goldsworth (eds), Anti-Money Laundering: International Law and Practice (Wiley, Chichester 2007) 111.

26Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PARTIOT Act) (Pub. L. 107-56).

27See in particular sections 312-314, 319(b), 325-326, 351-352, 356, 359 and 362.

28Financial Crimes Enforcement Network (FinCEN), ‘USA PATRIOT Act’ < https://www.fincen.gov/resources/statutes-regulations/usa-patriot-act> accessed 26 August 2017.

29U.S. Department of the Treasury, ‘Treasury Order 180-01’ < https://www.treasury.gov/about/role-of-treasury/orders-directives/Pages/to180-01.aspx> accessed 26 August 2017.

30D Cox, Handbook of Anti-Money Laundering (1st edn, Wiley 2014) 690 ff.

31JW Moscow, ‘USA’ in WH Muller, CH Kalin & JG Goldsworth (eds), Anti-Money Laundering: International Law and Practice (Wiley, Chichester 2007) 113 f.

32Directive (EU) 2015/849 of the European Parliament and of the Council on the Prevention of the Use of the Financial System for the Purposes of Money Laundering or Terrorist Financing, Amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and Repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (4th AMLD) [2015] OJ L 141/73.

33Financial Action Task Force (FATF), ‘FATF 40 Recommendations’ (20 June 2003).

34FATF, ‘FATF IX Special Recommendations’ (22 October 2004).

35Uniting and Strengthening America by Fulfilling Rights and Ensuring Effective Discipline Over Monitoring Act of 2015 (USA Freedom Act) (Pub. L. 114-23).

36B Zagaris, ‘The Merging of the Anti-Money Laundering and Counter-Terrorism Financial Enforcement Regimes after September 11, 2001’ (2004) Berkeley J. Int’l L. 22(1) 124.

37Council Directive 91/308/EEC on Prevention of the Use of the Financial System for the Purpose of Money Laundering [1991] OJ L 166/77.

38See United States Senate ‘Hearings before the Committee on Banking, Housing, And Urban Affairs’ (S. Hrg. 108-802) (2004) < https://www.gpo.gov/fdsys/pkg/CHRG-108shrg20396/html/CHRG-108shrg20396.htm> accessed 30 August 2017.

39B Zagaris, ‘The Merging of the Anti-Money Laundering and Counter-Terrorism Financial Enforcement Regimes after September 11, 2001’ (2004) Berkeley J. Int’l L. 22(1) 131.

40ibid 129.

41Legal Information Institute, ‘31 U.S. Code §5318A – Special Measures for Jurisdictions, Financial institutions, International Transactions, or Types of Accounts of Primary Money Laundering Concern’ < https://www.law.cornell.edu/uscode/text/31/5318A> accessed 30 August 2017.

42B Zagaris, ‘The Merging of the Anti-Money Laundering and Counter-Terrorism Financial Enforcement Regimes after September 11, 2001’ (2004) Berkeley J. Int’l L. 22(1) 133.

43EJ Gouvin, ‘Bringing out the Big Guns: the USA PATRIOT ACT, Money Laundering, and the War on Terrorism’ (2003) Baylor L Rev 55, 971 f.

44B Zagaris, ‘The Merging of the Anti-Money Laundering and Counter-Terrorism Financial Enforcement Regimes after September 11, 2001’ (2004) Berkeley J. Int’l L. 22(1) 133.

45Legal Information Institute, ‘31 U.S. Code §5318 – Compliance, Exemptions, and Summons Authority’ < https://www.law.cornell.edu/uscode/text/31/5318> accessed 30 August 2017

46B Zagaris, ‘The Merging of the Anti-Money Laundering and Counter-Terrorism Financial Enforcement Regimes after September 11, 2001’ (2004) Berkeley J. Int’l L. 22(1) 133.

47Office of Counterterrorism, ‘Terrorist Exclusion List. Fact Sheet’ (December 2004) < https://2001-2009.state.gov/s/ct/rls/fs/2004/32678.htm> accessed 30 August 2017.

48Gramm-Leach-Bliley Act (GLBA) of 1999 (Pub. L. 106-102).

49EJ Gouvin, ‘Bringing out the Big Guns: the USA PATRIOT ACT, Money Laundering, and the War on Terrorism’ (2003) Baylor L Rev 55, 983.

50R Garver, ‘Will USA Patriot Act Prove A Recipe for Trouble?’ (2002) American Banker 167(77) 10.51

51Financial Crimes Enforcement Network (FinCEN), ‘USA PATRIOT Act’ < https://www.fincen.gov/resources/statutes-regulations/usa-patriot-act> accessed 30 August 2017.

52B Dolar and WF Shughart, ‘Enforcement of the USA Patriot Act’s Anti-Money Laundering Provisions: Have Regulators followed a Risk-Based Approach?’ (2011) Global Finance Journal 22(1) 22. – These immense costs that banks have to bear themselves in terms of the increased requirements of monitoring and reporting by AML/CTF policy has resulted in bank officers filing SARs frequently without reasonable grounds in order to avoid possible liability both in the US and the UK. In addition, accounts of bank clients with migration background, which usually have low incomes, are terminated or not opened at all if it is not profitable in the bank’s view. The rationale is to avoid costs for AML compliance under the new de-risking policy. See further G Lilienthal and N Ahmad, ‘Terrorism and Bank Secrecy: Has this Time-Honored Duty Been Abridged?’ (2015) JIBLR 30(10) 553.