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NASD Proposes Standards for Anti-Money Laundering Compliance Programs
Washington, DC, February 28, 2002 - The Securities and Exchange Commission has published for comment proposed NASD Rule 3011, which prescribes minimum standards for anti-money laundering compliance programs established by NASD members. The USA PATRIOT Act requires financial institutions, including broker-dealers and investment companies, to establish anti-money laundering compliance programs by April 24, 2002. Comments on the NASDR proposal must be filed with the SEC by March 18.
Proposed Rule 3011 would require each NASD member, on or before April 24, 2002, to develop and implement a written anti-money laundering program reasonably designed to achieve and monitor the member’s compliance with the requirements of the Bank Secrecy Act. Under the proposed rule, the program would have to be approved in writing by a member of senior management. The rule would require NASD member programs to, at a minimum:
- establish and implement policies and procedures that can be reasonably expected to detect and cause the reporting of suspicious transactions;
- establish and implement policies, procedures, and internal controls reasonably designed to achieve compliance with the Bank Secrecy Act;
- provide for independent testing for compliance to be conducted by member personnel or by a qualified outside party;
- designate an individual or individuals responsible for implementing and monitoring the day-to-day operations and internal controls of the program; and
- provide ongoing training for appropriate personnel.
The Proposing Release states that, prior to implementation of the proposed rule change, NASD Regulation, Inc. anticipates providing guidance to members in a Notice to Members “to assist member firms in developing an anti-money laundering program that fits their business model and needs.”