Which is a valid extraterritorial effect of the USA PATRIOT Act?
A.
Foreign branches of US banks can maintain correspondent accounts with banks that do not have a physical presence in any country.
B.
Financial institutions are allowed to specifically direct client transactions that move their funds into, out of, or through an internal bank concentration account ^
C.
Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country.
D.
Any deposits into foreign banks are not considered to have been deposited into any interbank account the foreign bank may have in the US.
The Answer Is:
C
This question includes an explanation.
Explanation:
Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country. The USA PATRIOT Act has an extraterritorial effect in that it prohibits broker-dealers from having correspondent accounts with foreign banks that do not have a physical presence in any country. This rule is designed to help prevent money laundering and terrorist financing by making it more difficult for funds to be moved to or through jurisdictions with less stringent anti-money laundering laws.
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