The USA Patriot Act signed by President Bush in October 2001 imposes new anti-money laundering requirements on brokerage firms and other financial institutions. By April 24, 2002, all brokerage firms were required to have new, comprehensive anti-money laundering programs in place.
What is money laundering?
Money laundering is the process of transferring illegally obtained money so that the funds appear to come from legitimate sources or activities. Money laundering occurs in connection with a wide variety of crimes, including fraud, illegal arms sales, racketeering, drug trafficking, robbery, and terrorism.
How big is the problem and why is it important?
The use of the U.S. financial system by criminals to facilitate terrorism or other crimes could well taint our financial markets. According to the U.S. State Department, one recent estimate put the amount of worldwide money laundering activity in excess of $1 trillion per year.
What are we required to do to combat money laundering?
Under new rules required by the USA PATRIOT Act, our anti-money laundering program must designate a special compliance officer, conduct employee training, conduct independent audits, and establish policies and procedures designed to detect and report suspicious transactions and ensure compliance with the new laws.
As part of these requirements, federal law requires all financial organizations to obtain, verify and record information that identifies each person who opens an account. When you request to open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We will also ask you to provide a copy of your driver’s license or other identification documents (such as passport and alien registration card). The information you provide may be used to perform a credit check and verify your identity using internal sources and third party vendors. Until you provide the documents or information we need, we will not be able to open an account or effect any transactions for you.
We thank you for your patience and hope you will support our efforts to deny terrorist groups access to America’s financial system.