Lapas attēli
PDF
ePub

3. Policy and Guidelines. In response to requests for examiner assistance from federal law enforcement authorities, the Division of Bank Supervision and all Regional Offices will cooperate to the fullest extent practicable. The following guidelines should be considered prior to granting any request for examiner assistance.

[ocr errors][ocr errors][ocr errors][ocr errors]
[ocr errors]

The request for assistance must be made by a legitimate law enforcement authority having jurisdiction over the suspected irregularity;

The information requested or that which the examiner has been asked to review must be relevant to a legitimate law enforcement inquiry;

The suspected irregularity must involve an insured state nonmember bank, its directors, officers, employees or customers;

In cases where the bank itself is not under investigation, the targets of
the investigation must be specified and should be associated with the bank
as directors, officers, employees or customers;

Compliance with all applicable provisions of the Right to Financial
Privacy Act covering disclosures of information derived from bank customer
records must be assured;

The selected examiner should be formally detailed to the law enforcement
authority for a period of time which is mutually convenient. During the
detail the Corporation will provide regular duty salary and travel
A Standard Form 52 should be prepared if the detail period
exceeds 30 calendar days. A separate travel authorization, if necessary,
and a separate travel voucher should be prepared to cover the detail
period;

The examiner should be instructed that while assisting the law enforcement authorities, he/she will be acting solely as a representative of the law enforcement authority and will not represent the FDIC in any way and should not assert nor exercise any authority as a Corporation examiner;

The examiner should be cautioned to avoid accompanying law enforcement agents on to the bank's premises for the purpose of gathering records; - In order to avoid inappropriate disclosure of irrelevant information gathered through the examination process, it may be prudent to select an examiner who has not participated in a recent examination of the bank under investigation. Of course, certain situations particularly those involving Federal Grand Jury proceedings may necessitate selection of the Examiner-in-Charge (or equally knowledgeable examiner) of the most recent examination of the bank under investigation;

Testimony under oath either at trial or before a Federal Grand Jury should be specifically authorized at such time as formally requested by the U.S. Attorney. Generally, authorization for such testimony should not be included in the original authorization to provide assistance.

[ocr errors]

4. Examination Resources. Any request for examiner assistance should be viewed in terms of the region's overall demand for examination resources. While our objective is to cooperate to the fullest extent possible, instances may arise in which the examiner's time may be more urgently needed elsewhere, e.g., in dealing with priority matters concerning problem bank examinations. In other words, assistance to law enforcement authorities is of priority, but not to the exclusion of all others.

5. Delegations of Authority to Provide Examiner Assistance to Federal Law Enforcement Authorities. Regional Directors have been delegated authority under Section 309.6(c)(4)(ii) to disclose Reports of Examination and other exempt records to the proper Federal and State prosecuting or investigatory authorities. This authority extends to providing examiner assistance whenever the irregularities discovered in banks are believed to constitute violations of any Federal or State civil or criminal law, or unsafe or unsound banking practice.

Pursuant to Section 309.6 (c) (8), Regional Counsels have been delegated authority from the General Counsel to authorize Corporation examiners to appear and testify at any administrative or judicial hearing or proceeding where such examiner has been served with a valid subpoena, court order, or other legal process requiring him to testify.

6. Contacts. Questions concerning this subject should be directed to the Intelligence Section at FTS 389-4415. A brief memorandum covering the nature and duration of and personnel involved in such details should also be forwarded to the Intelligence Section.

7. Expiration Date. This memorandum is effective until cancelled.

[blocks in formation]

1. Purpose. Distribute newly adopted examination procedures and supporting instructions covering Treasury's Financial Recordkeeping and Reporting of Currency and Foreign Transactions regulations (31 C.F.R Part 103).

2. General Provisions. The attached procedures have been adopted by the the FDIC, Office of the Comptroller of the Currency and the Federal Reserve System. They are set forth in two separate modules which are progressively extensive in scope. Completion of the first module enables the examiner to determine whether the examination can be concluded at that point or whether the examiner should continue into Module II.

Module I requires the examiner to establish that the examined institution has appropriate operating and auditing standards. In addition, it requires the examiner to conduct a detailed review of the institution's internal audit functions and entails the examination of procedures and selected workpapers, reports and responses. This review of auditing methodology and implementation should enable the examiner to decide whether to conclude the review or examine further.

Module II sets forth guidelines for the examiner to employ in conducting a review of a sample of actual transactions and related documentation.

This same type of extensive examination (i.e., both Modules I and II) would also be conducted in certain institutions determined by the FDIC or identified by other regulatory or law enforcement agencies as being in probable noncompliance with the regulations.

3. Responsibility and Action. The new procedures should be implemented inmediately. All previous memoranda containing examination procedures on this subject are hereby rescinded.

4. Report Checklist. A copy of Form FDIC 6500/54 revised February, 1981 is attached and should be used in conjunction with the new procedures. Supplies of the new forms are available from the Storage Unit Services Section.

5. Expiration Date. Effective until cancelled.

Attachment

[ocr errors]

Transmittal No. 65

FINANCIAL RECORDKEEPING AND REPORTING REGULATIONS

EXAMINATION PROCEDURES

MODULE I

The purpose of this module is to determine that the financial institution under examination has established operating standards and audit procedures to reasonably ensure compliance with the requirements of the regulations.

1. The examiner should meet with and submit the Checklist (Form FDIC 6500/54) to either a senior official or compliance officer, if applicable, of the institution for completion and require sign-off by the official.

[merged small][merged small][merged small][ocr errors]

The examiner should ascertain that the institution has established in writing formal operating procedures to ensure compliance with the regulations. It would be acceptable for certain small financial institutions which do not regularly handle large currency transactions to operate under standard procedures not reduced to writing.

a) Reporting - Operating procedures should set forth the requirements of the regulations and establish compliance guidelines with respect to large cash transactions and exemptions granted to customers.

b) Recordkeeping - The institution's record retention schedule should, at
a minimum, include the record retention requirements of the
regulations. Futhermore, requirements for the maintenance of lists of
exempt customers with retail affiliations and customers from whom
taxpayer identification numbers have not been obtained should be
included.

Obtain a copy of the institution's list of exempt customers. Through a review of this document, determine:

a) that its contents conform to the requirements of the regulations
(name, address, business, nine-digit Federal taxpayer identification
number, reason for exemption, etc.) (103.22(e)), and that the
exemptions appear reasonable.

b) that the institution has, in granting exemptions, adhered to its
established policy.

The examiner should review the file of reports submitted (4789 and 4790) and ascertain that they are properly completed and filed as required.

The examiner should ascertain that the institution has established a
program of employee education with regard to the requirements of the
regulations.

a) Tellers, through an ongoing training program, should be apprised of the reporting requirements for large cash transactions.

b) Operations personnel should be made aware of the current requirements

of the regulations and management should periodically reinforce the importance of compliance.

c) Operations personnel (i.e., tellers, platform officers, branch managers) should be interviewed to ascertain whether they are sufficiently knowledgeable concerning the regulations and operating procedures to assure compliance. This phase of the examination should be conducted at those branches which conduct relatively large volumes of cash business.

PROCEDURE 6 IS TO BE OMITTED IF THE INSTITUTION DOES NOT HAVE AN INTERNAL AUDIT FUNCTION. IN SUCH CASES, THE EXAMINER SHOULD ASCERTAIN THAT A PROGRAM OF MANAGEMENT REVIEWS OR SELF AUDITS HAS BEEN ESTABLISHED WHICH ENCOMPASSES THE REQUIREMENTS OF THE REGULATIONS.

6.

7.

8.

The examiner should test the institution's own audit procedures and
determine that the internal audit function provides coverage of the
following sections of the regulations.

[ocr errors]

a) Reporting - Coverage of the reporting requirements should
be found in the procedures and should include a review of
actual tellers' work and Forms 4789 and 4790.

b) Recordkeeping - Coverage of the institution's recordkeeping activities should encompass a test of adherence to the in-house record retention schedule. It is understood that this schedule should meet the requirements of the regulations.

c) Exemptions

[ocr errors]

Coverage should include audit steps necessary to ascertain that the institution is maintaining a list of exempt customers which includes their retail affiliations as required by the regulations. The examiner should expect the audit procedure to provide a test of the reasonableness of the exemptions granted.

[ocr errors]

d) Foreign Accounts Coverage in this area should require the auditor to ascertain that the institution has filed Form 90-22.1 declaring interest in a foreign financial account.

The examiner should review the results of the prior examination report and follow-up on any deficiencies.

The examiner should review the totals of cash shipped to and/or received from the Federal Reserve Bank (reported on Form MD-115) or correspondent bank during the last six months. If, in the examiner's judgement, that amount appears high in relation to the amount the bank has reported on Form 4789 for the last six months, the examiner should discuss his/her findings with management and obtain a reasonable explanation.

AT THIS POINT, THE EXAMINER MUST EXERCISE JUDGEMENT IN DECIDING WHETHER
FURTHER EXAMINATION AND TESTING IS NEEDED.

-If the examiner is satisfied with the results from the steps
above, the findings should be summarized in the workpapers.

« iepriekšējāTurpināt »