Congress works to tighten anti-money laundering laws

As congress worked to tighten money laundering laws, banking organizations pledged support for the new measures. In a joint statement to the House Financial Services Committee, America's Community Bankers (ACB) and Independent Community Bankers of America (ICBA) said that their members "vigorously support any effective measures that will help dry up the funds that terrorists depend on."

In his testimony before the House, American Bankers Association Deputy Executive Vice President and Executive Director of Government Relations Edward L. Yingling reaffirmed the banking industry's support for the financial war against terrorists and outlined ways current anti-money laundering measures can be enhanced.

"The task ahead of us is daunting and should not be underestimated," said Yingling. "Banks are able to track what is in the traditional system; it takes cooperation and close coordination with the government and law enforcement agencies to identify individuals and groups suspected of illegal activities."

ICBA and ACB said that while community banks focus on serving domestic consumers and businesses in their local areas, virtually any bank will conduct an occasional international transaction on behalf of a local customer.

"No matter what the level of international business, each community banker will have to be prepared to comply with whatever new rules Congress enacts," the groups said. "That will involve implementing new procedures, retraining of tellers and other personnel and buying new software. ACB and ICBA members are fully prepared to make those investments in our nation's security."

The groups said that Congress and the administration could help by making the new rules "clear, understandable and workable, not just for the most sophisticated international bank, but for community banks in towns and neighborhoods across the country."

In the House of Representatives, its anti-money laundering legislation (H.R. 3004) cleared on a 412-1 vote. Representatives also agreed to roll it into the broader anti-terrorism package passed a week earlier. The Senate has passed similar legislation.

The House measure would bolster the ability of law enforcement to find and destroy the financing of terrorist organizations; establish a government-industry partnership to stop terrorist funding in real-time; track terrorist money kept in off-- shore havens; make it a crime to smuggle currency in excess of $10,000; and to knowingly falsify a customer's identity when making a transaction or opening an account at a financial institution.

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FinCEN establishes hotline

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A hotline has been established by the U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN) for financial institutions to voluntarily report suspicious transactions that may relate to recent terrorist activity against the United States. The Financial Institutions Hotline is 1-866-556-- 3974. It is operational seven days a week, 24 hours a day.