International Financial Law Prof Blog

Editor: William Byrnes
Texas A&M University
School of Law

Tuesday, August 11, 2015

China Construction Bank Ordered to Beef Up its AML Program

China Construction Bank entered into an agreement with the Federal Reserve and New York State NY DFS
Department of Financial Services to self audit and enhance its anti money laundering program, including CDD and risk weighting of customers and their respective activities, suspicious activities monitoring and reporting, AML training, and integrity audits.

The Federal Reserve Bank Enforcement Order (Download) included:

Within 60 days of this Agreement, the Bank and the Branch shall jointly submit a written enhanced BSA/AML compliance program for the Branch acceptable to the Reserve Bank and the NYSDFS (the “Supervisors”). At a minimum, the program shall provide for:

(a) a system of internal controls designed to ensure compliance with the BSA/AML Requirements and State Regulations;

(b) internal controls designed to ensure compliance with all requirements relating to correspondent accounts for foreign financial institutions, including, but not limited to, affiliates;

(c) a comprehensive BSA/AML risk assessment that appropriately identifies and considers all products and services of the Branch, customer types and geographic risks, as appropriate, in determining inherent and residual risks;

(d) internal controls to ensure that the data received by the Branch’s BSA/AML monitoring system is complete and interpretable by the system; and

(e) effective training for all appropriate Branch personnel and appropriate personnel of affiliates that perform BSA/AML compliance-related functions for the Branch in all aspects of the BSA/AML Requirements, State Regulations, and internal policies and procedures.

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