Compliance Publications for Foreign Corporations?

Question:

Is there any published reading on banking foreign corporations and how to become familiar with ones such as Mexican, Venezuelan, Bahamian, etc? We want to continue to bank foreign corporations, but want to ensure we are doing what's required by OFAC and Fincen.

Answer:

I have never seen any type of publication on this topic. Generally, this is handled by the bank doing research on specific regulatory requirements and engaging legal assistance from law firms with expertise in international law. If you are taking deposits and sending wires and other payment items, your risks are primarily BSA/AML risks. You will need to know what to look for such as proper legal documentation of existence of the foreign corporation, what is required of them to do business here in the US, etc. Besides reading the various FINCEN publications and the information on the OFAC website, the bank should review state department information on countries such as that included in the "background notes" on the Department of State. There is a great deal of useful information there that gives you a flavor for the country, its relations with the US, stance on money laundering and terrorism, etc. If you are going to lend to them, the bank needs to understand the legal, economic and political environment of the countries to know the risks. A full understanding of ownership of collateral(any collateral in a foreign country, how to secure it, etc.)is very important.

First published on BankersOnline.com 11/19/07