Steptoe & Johnson LLP provides legal advice on all aspects of anti-money laundering (AML) rules and regulations, both in the compliance counseling and enforcement contexts.
AML requirements, counter-terrorist financing regimes, know-your-customer (KYC) rules, and asset blocking and reporting requirements are increasingly complicated and comprehensive. Our attorneys are well-prepared to confront enforcement problems, to evaluate your company's existing AML policies and procedures, and to assist your company to set up and implement new programs, incorporating best practices that meet with regulatory approval.
The firm's Law Enforcement and Technology group helped draft many provisions of the USA Patriot Act and has an extensive practice advising companies on how to respond to law enforcement requests. The USA Patriot Act includes provisions designed to track down and stop international money-laundering efforts and advance the US government’s war on terrorism by expanding its regulatory AML regime and by vigorously pursuing enforcement of AML statutes and regulations.
Section 352 requires each “financial institution”—very broadly defined—to establish AML programs. Financial institutions need to know who their customers are, and more and more about what they are doing, in light of AML and anti-terrorist financing monitoring. KYC regulations currently in place are the first step in an as-yet-to-be-completed regulatory process of extending bank-style AML responsibilities throughout the financial system, and must be monitored closely. Steptoe is well-positioned to assist its clients in this area.
Related Professional Services
Our firm offers a nationally recognized white-collar criminal defense practice should your company become involved in an investigation or enforcement action relating to allegations of money laundering by your clients or customers. We also have an equally skilled financial services team.
White-collar litigation/criminal defense. The white-collar litigation team includes Reid Weingarten, widely recognized as one of the nation’s top criminal defense lawyers, as well as former federal prosecutors with extensive trial experience and a host of attorneys with substantial experience in other government positions. Our white-collar criminal defense team represents individuals and corporations in some of the most noteworthy cases in the country involving allegations of accounting and securities fraud and corporate misconduct, public corruption, money laundering, price fixing, government contracting fraud, healthcare fraud, and environmental crimes.
Our clients include corporations and senior executives in the telecommunications, pharmaceutical, energy, chemical, electronics, electronic commerce, agricultural, and cruise line industries, as well as financial institutions and foreign governments. When the future of a company hangs in the balance, many of the nation’s highest profile senior executives and corporations choose Steptoe to represent them.
Financial services litigation. Steptoe litigators represent financial institutions and their officers and directors in white-collar issues such as allegations of money laundering and other alleged violations of law, as well as in lender liability claims and counterclaims involving securities fraud, common-law fraud, and Rackateer Influenced and Corrupt Organizations Act (RICO) claims, and merger and acquisition-related litigation. Our work in these matters has ranged from informal proceedings to cease-and-desist actions and other enforcement matters initiated by federal and state agencies. Steptoe has also defended financial institutions against civil claims predicated on the alleged breach of BSA and AML rules and regulations.
Case Study—A Prominent National Bank
Steptoe represents one of the nation’s most venerable financial institutions in connection with ongoing civil, criminal, and congressional investigations centered on AML/Bank Secrecy Act (BSA) compliance. This representation has embraced both systemic issues of devising and implementing practices and policies to meet with go-forward regulatory approval, and disclosure and enforcement issues in connection with legacy systems and particular historical transactions. In addition, we have assisted in a broad range of internal investigatory work. This ongoing representation has brought Steptoe lawyers in close contact and coordination with the full community of regulatory, congressional, and criminal authorities.
Case Study—KYC/Anti-Terrorism Financing Compliance
Steptoe provides advice to financial institutions subject to new USA Patriot Act KYC requirements and long-standing Office of Foreign Assets Control (OFAC) anti-terrorism/asset-blocking regimes. This has involved advising on methods for conducting customer due diligence consistent with the institution’s business model; screening customers against various USG lists; resolving false positives; and filing reports with either OFAC, the Financial Crimes Enforcement Network (FinCEN), or both. We have also developed independent audit plans for institutions that are required to test their AML and OFAC compliance systems.
Case Study—International Compliance
Steptoe represents several major European financial groups—including insurers and intermediaries—that have sought our counsel on how to effectively exploit the single license to write insurance on a cross-border basis in the European Union. Our advice covers the basic regulatory regimes set out in the EU Directives and national implementing provisions, while embracing and addressing European AML and KYC practices and protocols.
Steptoe assisted a multi-national company by drafting an anti-money laundering compliance program with regard to commodity trading of precious metals. This effort required a compliance program that integrated both U.S. and U.K. legal requirements and best practices. After drafting the program, Steptoe provided training to senior precious metal trading staff to assist with implementation of the program, including Know Your Customer due diligence requirements and AML risk assessments.
Steptoe assisted a non-U.S. mining company with the revision of an anti-money laundering /terrorism financing compliance policy and compliance program to be consistent with U.S. legal developments. The compliance program work involved commenting on and modifying a number of processes, including those related to Know Your Customer risk assessment, internal and external reporting, and recordkeeping, among others.
Steptoe provided advice about the types of insurance institutions required to adopt an anti-money laundering and terrorism finance compliance program under the PATRIOT Act, as well as those required to share information about transactions among other financial institutions. Although Steptoe concluded that the client was not legally obligated to comply with such AML rules currently in force, Steptoe furnished guidance about the minimum standards that could be adopted to assess and remediate money laundering issues, as well as voluntary actions to share financial information.
Steptoe provided anti-money laundering compliance advice to companies that could be considered Money Service Businesses through the issuance of prepaid access devices (formerly known as stored value). Steptoe assessed whether such business would require registration with FinCEN and the adopt of an AML compliance program, or whether such business fell under any applicable exemptions so that such business would not be subject to AML rules regarding financial institutions. This assessment involved an analysis of new regulatory requirements and guidance issued by the FinCEN.
Steptoe provided guidance to a U.S. investment fund about the legal status and strength of anti-money laundering compliance requirements implemented by foreign central banks and member financial institutions, as well as attendant anti-terrorism finance risks that could be heightened by investing in or with such institutions. This guidance involved an assessment of such compliance issues in a number of countries, including Angola, China, Cote D’Ivoire (Ivory Coast), Ecuador, Guinea, Iraq, Lebanon, Liberia, Kurdistan (Northern Iraq), Mongolia, Myanmar (Burma), Nigeria, Peru, Saudi Arabia, Sierra Leone, Sudan, the United Arab Emirates, and Zimbabwe.
Steptoe assisted a non-governmental organization think tank assess a demand from the Chief Civil Asset Forfeiture U.S. Attorney for the Southern District of New York to pay restitution for charitable contributions received from an individual who pleaded guilty to operating a Ponzi scheme. At the time the individual made such donations, our client had no knowledge that such funds were the proceeds of crime. After evaluating the receipt of donations, baking records, and other information, the organization determined that it had spent any such funds long ago and could not pay restitution. The U.S. Attorney dropped its demands.
Steptoe provided advice to an international passenger carrier about currency transaction reporting obligations under applicable U.S. anti-money laundering regulations.
Steptoe provided training to an international oil services company regarding basic AML compliance.
Select News & Events
- Wall Street Journal Quotes Stephen Heifetz on Money Laundering Allegations
- LexisNexis Interviews Patrick Rappo on New EU Anti-Money Laundering Rules
- Global Investigations Review Quotes Jack Hayes on Spain’s AML Regulator
- Rich Battaglia Joins Steptoe’s International Regulation & Compliance Group
- Complying with Iranian Sanctions at Both the State and Federal Levels, ACI’s 4th Annual Forum on AML and OFAC Compliance for Insurance Industry
- Conducting Effective Internal Investigations into Potential Money Laundering, Fraud, Sanctions Violations, or FCPA Violations, ACI’s Forum for Insurance Industry
- Ed Krauland to Speak at ABA Section of Real Property, Trust and Estate Law, Spring Meeting
- Asset Tracing and Money Laundering: Key Considerations and Practical Strategies for Dealing with Fraud Cases in Russia