What Banking CCOs Need to Know about New Terrorist Funding Order
An executive order signed by President Trump on Monday strengthens the ability of the U.S. government to thwart terrorism by limiting terrorists’ access to funding. In particular, the order expands actions that can be taken against foreign financial institutions that unknowingly have terrorists as customers.
The executive order “raises the stakes for non-U.S. financial institutions dealing with U.S.-sanctioned terrorists, because those banks may now be subject to ‘secondary sanctions’ that can cut off their access to the U.S. financial services market,” explained Matthew Thomas, a partner at the law firm Blank Rome.
Now may be the time to take a second look at know-your-customer policies and procedures. Current U.S. sanctions and regulations tackling money laundering, along with multilateral efforts to address terrorist finance globally, “already have resulted in significant improvements in KYC policies and procedures at international banks and other financial firms over the last decade,” Thomas said. “Still, these new authorities could provide additional incentives for the global banking community to continue to focus on and improve anti-money laundering compliance,” he said.
"What Banking CCOs Need to Know about New Terrorist Funding Order," by Lori Tripoli was published in Compliance Week on September 13, 2019.