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Treasury Publishes Admin Ruling: Foreign Exchange Dealers Can Use Non-Resident Aliens' Alternative Travel Docs for Recordkeeping

March 12, 2014

Author: Edward Goetz.

The Financial Crimes Enforcement Network (“FinCEN”) issued, on March 11, 2014, an Administrative Ruling for dealers in foreign exchange allowing the use in certain circumstances of a travel document other than a passport as suitable identification documentation in currency transactions in excess of $1,000. The exceptive relief in this case is applicable only to the recordkeeping requirement in connection with verifying the identity of a non-resident alien. Current examples of such alternatives are the Border Crossing Card bearing a B1/B2 visitor visa issued by the Department of State, and the Radio Frequency Identification Document issued by the U.S. Customs and Border Patrol pursuant to the SENTRI program.

Allowing dealers to satisfy the recordkeeping requirements of 31 CFR § 1022.410(b)(3) with alternative travel documents for non-resident aliens without a passport reconciles current border crossing policy with the interests of financial institutions (“FIs”). In the case of a transaction with a non-resident alien exceeding the $1,000 threshold, each foreign exchange dealer must retain the number and description of the government document used to verify the customer’s identity. This ruling also applies to non-resident aliens using alternative documents who do possess a passport issued by their country of origin.

As always, this ruling does not negate an FI’s obligation to file a suspicious activity report (“SAR”) when due diligence suggests a transaction will in some way violate or circumvent the Bank Secrecy Act or the reporting requirements of any other Federal law or regulation.

Clients should contact Crowell with any questions they might have on alternative travel documents and their impact on due diligence and recordkeeping.
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Edward Goetz
Manager, International Trade Services – Washington, D.C.
Phone: +1 202.508.8968
Email: egoetz@crowell.com