The USA Patriot Act stipulates measures for financial institutions, jurisdictions and international transactions to prevent money laundering, and it requires special due diligence for private banking and correspondent accounts, according to the U.S. Department of the Treasury Financial Crimes Enforcement Network. It was established in 2001.Continue Reading
The USA Patriot Act, officially titled the "Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001," also prohibits U.S. correspondent accounts with foreign shell banks, stipulates strict verification of individuals' identities when opening financial accounts, establishes immunity for individuals reporting suspicious activity and requires the Financial Crimes Enforcement Network to facilitate a secure network for electronic financial transactions, notes the U.S. Department of the Treasury.
The act allows the U.S. Secretary of Treasury the right to issue regulations that further govern how concentration accounts are maintained at financial institutions to ensure accounts are not created with an intention to obscure the identity of a bank customer. The purpose of the USA Patriot Act is to prevent international money laundering and potential financing of terrorist acts and to detect and eventually prosecute parties found guilty of these crimes, according to the U.S. Department of the Treasury.Learn more about Law