Anti-Money-Laundering Rules to Change

WASHINGTON —  After a review of U.S. anti-money-laundering efforts, the Bush administration will push banks to file fewer reports on potentially suspicious cash transfers while pursuing efforts to extend similar requirements to securities firms and casinos, sources said Wednesday.

The new moves were detailed in a Treasury Department report that was to be presented to Congress Wednesday, people familiar with the report said.

Its release was postponed after Tuesday’s terror attacks in New York and outside Washington.

The Treasury in June launched an internal review of its anti-money-laundering rules, a move widely interpreted as a signal the Bush administration might be backing away from Clinton-era efforts to get tough on the problem.

But congressional and industry sources said the new strategy generally appeared to build on previous efforts rather than roll them back.

Money laundering involves moving illicit funds, often linked to drug trafficking or organized crime, through a series of bank accounts to disguise their origin.

In the report, the Treasury committed to push ahead with long-delayed rules requiring securities firms and casinos, as well as check cashers and money transmitters, to report large, suspicious cash transactions--something that banks already do.

The various rules, some of which have been in the pipeline for more than five years, are to be issued early in 2002, the sources said.

At the same time, banks will be encouraged to take more latitude when reporting large cash transfers to try to weed out repeated, legitimate transactions, they said.

Such transactions form the bulk of the millions of reports filed each year, making it harder to sift for true money-laundering red flags.

The new strategy also will focus more resources on breaking up large-scale, professional money laundering operations and will add foreign corruption offenses, such as bribery and theft of government funds, to the list of crimes that can trigger a U.S. money laundering prosecution, the sources said.

Embarrassing revelations in recent years that major U.S. banks have been used to channel billions of dollars of illicit funds have led to calls for tough action in Washington.

Last month, a bipartisan group of senators introduced wide-ranging legislation that, among other things, would bar U.S. banks from dealing with shadowy foreign “shell” banks and require closer review of large U.S. bank accounts opened for overseas customers.