Advisory Information
FIN-2014-A001.pdf280.87 KB
FIN-2014-A001
Issued Date
Subject
Guidance to Financial Institutions on Recent Events related to the Departure of Victor Yanukovych and Other Ukrainian Officials

If a financial institution knows, suspects, or has reason to suspect that a transaction relatingto senior foreign political figures involves funds derived from illicit activity, includingmoney laundering, terrorist financing, or any other violation of law or regulation, or if thetransaction appears to have no business or lawful purpose or has a purpose inconsistent withthe customer’s known business, the financial institution must file a Suspicious Activity Report(SAR) consistent with FinCEN’s regulations.3 In addition, covered financial institutions arereminded of the regulations implementing section 312 of the USA PATRIOT Act (31 U.S.C.5318(i)), which require a written due diligence program for private banking accounts held fornon-U.S. persons designed to detect and report any known or suspected money laundering orother suspicious activity.4 In instances where senior foreign political figures maintain privatebanking accounts at a covered institution, those financial institutions are required to applyenhanced scrutiny of such accounts to detect and report transactions that may involve theproceeds of foreign corruption.5

In April 2008, FinCEN issued Guidance to assist financial institutions with reportingsuspicious activity regarding proceeds of foreign corruption. That Guidance also discussespotential indicators that transactions may be related to proceeds of foreign corruption.6Financial institutions may find this Guidance useful in assisting with suspicious activitymonitoring and due diligence requirements related to senior foreign political figures.

Additional questions or comments regarding the contents of this Advisory should beaddressed to the FinCEN Resource Center at (800) 949-2732. Financial institutions wantingto report suspicious transactions that may relate to terrorist activity should call theFinancial Institutions Toll-Free Hotline at (866) 556-3974 (7 days a week, 24 hours a day).The purpose of the hotline is to expedite the delivery of this information to law enforcement.Financial institutions should immediately report any imminent threat to local-area lawenforcement officials.

 

1 For updated information on developments concerning the administration of Victor Yanukovych, see http://travel.state.gov/content/passports/english/alertswarnings/ukraine-travel-warning.html and http://www.consilium.europa.eu/uedocs/cms_Data/docs/pressdata/EN/foraff/141110.pdf.

2 “Senior foreign political figure” means a current or former senior official of a foreign government or of a major foreignpolitical party; a senior executive of a foreign government-owned commercial enterprise; a corporation, business,or other entity that has been formed by, or of the benefit of, any such individual; the immediate family members ofany such individual; and a person who is widely and publicly known (or is actually known by the relevant coveredfinancial institution) to be a close associate of such individual. For the purposes of this definition, “senior official orexecutive” means an individual with substantial authority over policy, operations, or the use of government-ownedresources and “immediate family member” means spouses, parents, siblings, children and a spouse’s parents andsiblings. See, 31 CFR 1010.620(c) and 31 CFR 1010.605(p).

3 See, e.g., 31 CFR 1010.320.

4 See, generally, 31 CFR 1010.620.

5 31 CFR 1010.620(c).

6 See, “Guidance to Financial Institutions on Filing Suspicious Activity Reports Regarding the Proceeds of ForeignCorruption,” FIN-2008-G005 (April 17, 2008). https://www.fincen.gov/resources/advisories/fincen-guidance-fin-2008-g005.