Treasury Issues Final Rule Regarding Broker-Dealer Reporting of Suspicious Transactions
The Financial Crimes Enforcement Network of the U.S. Department of the Treasury (the "Treasury") issued a final rule (the "Rule) that requires all broker-dealers (including those not affiliated with banks or bank holding companies) to report suspicious transactions to the Treasury. The Rule is effective July 31, 2002 and will apply to transactions occurring after December 30, 2002. The Rule requires a broker-dealer to report to the Treasury on a Form SAR-BD any transaction that involves at least $5,000 in cash or other assets and that the broker-dealer knows, suspects or has reason to suspect falls within any one of four categories: (1) transactions involving funds derived from illegal activity or intended or conducted in order to hide funds derived from illegal activity; (2) transactions disguised (through structuring or otherwise) to evade the Bank Secrecy Act; (3) transactions that appear to
