Luxembourg Banks to Enhance Compliance with Bank Secrecy Act

Introduction

The Office of the Comptroller of the Currency (OCC) has emphasized the importance of Bank Secrecy Act (BSA) compliance for national banks operating in Luxembourg. In an effort to prevent and detect money laundering, terrorist financing, and other illicit activities, Luxembourg banks will be required to implement robust BSA compliance programs.

Key Requirements

• Effective Customer Due Diligence Systems: Luxembourg banks must establish systems to identify and verify the identity of customers.
• Monitoring Programs: Banks must have monitoring programs in place to detect suspicious activity.
• Screening Against Government Lists: Banks must screen against Office of Foreign Assets Control (OFAC) and other government lists.
• Risk-Based Anti-Money Laundering Programs: Banks must develop risk-based anti-money laundering programs.

Additional Requirements

• Suspicious Activity Reports (SARs): Luxembourg banks must file SARs using the Bank Secrecy Act BSA E-Filing System. Financial institutions must submit SARs no later than 30 calendar days after the date of initial detection of facts that may constitute a basis for filing a suspicious activity report.
• Cash Purchase Records: Banks must keep records of cash purchases of negotiable instruments.
• Reports of Cash Transactions: Banks must file reports of cash transactions exceeding $10,000 (daily aggregate amount).
• Suspicious Activity Reporting: Banks must report suspicious activity that might signal criminal activity.

Implementation and Guidance

The OCC will work closely with Luxembourg banks to ensure their compliance with BSA regulations and provide guidance on implementing effective anti-money laundering programs.