AL 2000-8
Subject: U.S. Department of Treasury  
         FinCEN Advisories 13 through 27
Date: August 9, 2000

TO: Chief Executive Officers and Compliance Officers 
    of National Banks and Federal Branches, Department 
    and Division Heads, and Examining Personnel

In July 2000, the U.S. Department of the Treasury's 
Financial Crimes Enforcement Network (FinCEN) issued 
a series of advisories to inform banks and other 
financial institutions operating in the United States 
of serious deficiencies in the counter-money-laundering 
systems in the following jurisdictions: 

The Bahamas;
The Cayman Islands;
The Cook Islands;
Dominica;
Israel;
Lebanon;
Liechtenstein;
The Marshall Islands;
Nauru;
Niue;
Panama;
The Philippines;
The Russian Federation;
St. Kitts and Nevis; and
St. Vincent and The Grenadines.

These advisories are available at www.treas.gov/fincen. 

The FinCEN advisories emphasize the need for enhanced scrutiny 
of certain transactions and banking relationships in these 
jurisdictions to ensure that appropriate measures are taken 
to minimize risk for money laundering.  Depending on the 
nature and scope of banking relationships in the subject 
urisdictions, if any, banks should ensure that adequate 
Bank Secrecy Act (BSA) compliance programs are in place 
to detect money laundering and report suspicious activity 
in a timely manner, as required by 12 CFR 21.21.  BSA 
compliance programs should have adequate account and 
transaction due diligence systems and controls to protect 
the bank against misuse by money launderers.  Banks should 
understand the true nature and intended relationships of 
customers transacting business in the subject jurisdictions.  
A number of the advisories emphasize this point by advising 
institutions to "give enhanced scrutiny to transactions or 
banking relationships that do not involve established, and 
adequately identified and understood, commercial or investment 
enterprises."  

Based on the international nature of the advisories, banks 
should pay particular attention to the possibility of 
suspicious transactions in

* International correspondent banking;
* International wire transfers;
* Private banking relationships;
* Pouch/cash letter activity;
* Deposit broker transactions;
* Private investment companies;
* Offshore financial centers; and
* Shell corporations. 

In cases involving affiliate branches located in the subject 
jurisdictions, corporate or global BSA policies should be 
adequately designed and implemented to control the risk of 
money laundering.  In cases involving correspondent banking 
relationships with financial institutions located in the 
subject jurisdictions, banks should ensure that BSA compliance 
programs minimize risk in accordance with the level of potential 
exposure.  Banks should also seek to ensure that correspondent 
banks in these jurisdictions have adequate due diligence 
standards to prevent money laundering.  

The FinCEN advisories emphasize that they are not intended 
to curtail legitimate business with the identified jurisdictions, 
nor should they prompt unwarranted closure of accounts.  
Instead, banks should evaluate and respond to the risk posed 
by any customer or affiliate relationship in the subject 
jurisdictions.  The OCC will continue to examine banks to 
ensure that BSA compliance programs are adequate to address 
the risk of money laundering, including activity in these 
jurisdictions.  Please refer to the BSA booklet in the 
Comptroller's Handbook and OCC Advisory Letter (AL) 2000-3 
for guidance on controlling the risk of money laundering.  
Copies of the booklet and AL 2000-3 are available at 
www.occ.treas.gov/handbook/bsa.pdf, and www.occ.treas.gov/advlst00.htm.

If you have any questions, or need copies of the FinCEN 
advisories, please contact your supervisory office or the 
Community and Consumer Policy Division BSA staff at (202) 874-4428.  






______________________________________
Ralph E. Sharpe
Deputy Comptroller
Community and Consumer Policy