Page "Money laundering" Paragraph 117

The BSA requires financial institutions to engage in customer due diligence, which is sometimes known in the parlance as " know your customer ".

This includes obtaining satisfactory identification to give assurance that the account is in the customer ’ s true name, and having an understanding of the expected nature and source of the money that will flow through the customer's accounts.

Other classes of customers, such as those with private banking accounts and those of foreign government officials, are subjected to enhanced due diligence because the law deems that those types of accounts are a higher risk for money laundering.

All accounts are subject to ongoing monitoring, in which internal bank software scrutinizes transactions and flags for manual inspection those that fall outside certain parameters.

If a manual inspection reveals that the transaction is suspicious, the institution should file a Suspicious Activity Report.