Skip to Content

NY.gov Portal State Agency Listing

Translate | Disclaimer

Department of Financial Services logo

Banking Interpretations

NYSBL 200 and 221-a

Memorandum 


TO:       Senior Examiner Straughn
              Foreign Financial Services Division

FROM:  Assistant Counsel Kane 
              Legal Division

RE:        [ ] - USA Patriot Act Inquiry

DATE:   December 16, 2002


[ ] ("Bank"), a bank chartered under the laws of [ ] which maintains a New York Representative Office, has requested clarification of several points with respect to the Certification for Purposes of Section 5318(j) and 5318(k) of Title 31, United States Code. We assume, for purposes of this memorandum, the jurisdictional questions which the Bank raises under the USA Patriot Act have been triggered by the fact that the Bank maintains both correspondent accounts with banks headquartered in the United States and engages in treasury transactions with foreign banks which maintain either a branch or agency in the United States.

Paragraph 4 of the certification requires that a foreign bank certify the identity of its agent for service of legal process in the United States. Street addresses must be provided; post office boxes are not acceptable. The regulations to be set forth in Section 103.177 of Title 26 of the Federal Code of Rules and Regulations, which relate to the maintenance of a "covered financial institution" of records concerning the owners of foreign banks and agents designated to receive service of legal process, have not yet been promulgated. Accordingly, we conclude that since the Bank maintains a Representative. Office in New York, it may designate its representative as the individual upon whom process may be served.

The Bank has also requested clarification as to whether it must file certification forms with any foreign banking entity which maintains branches or subsidiaries in the US with which it carries out treasury transactions. Branches and agencies maintained by foreign banks in the United States are included in the definition of "covered financial institution" which must comply with the record keeping requirements of the USA Patriot Act. Section 103.175(B) of Title 31 of the Federal Code of Rules and Regulations has adopted the definition of "correspondent account" set forth in Section 311 of the USA Patriot Act, as codified in Section 5318(A)(e) of the United States Code, which defines a correspondent account as "an account established to received deposits from, make payments on behalf of a foreign financial institution, or handle other financial transactions related to such institution." Thus, based on the broad language employed in this definition and the absence of any indication that these "treasury securities" are not cleared through U.S.-based accounts, we conclude that the Bank must also file certifications in this instance.

Noted:________ 
          S.A.K.