81_FR_11539 81 FR 11496 - Financial Crimes Enforcement Network; Withdrawal of Notice of Proposed Rulemaking Regarding Banca Privada d'Andorra

81 FR 11496 - Financial Crimes Enforcement Network; Withdrawal of Notice of Proposed Rulemaking Regarding Banca Privada d'Andorra

DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network

Federal Register Volume 81, Issue 43 (March 4, 2016)

Page Range11496-11497
FR Document2016-04768

This document withdraws FinCEN's notice of proposed rulemaking seeking to impose the fifth special measure regarding Banca Privada d'Andorra (``BPA''), pursuant to Section 311 of the USA PATRIOT Act (``Section 311''), codified at 31 U.S.C. 5318A. Because of material subsequent developments that have mitigated the money laundering risks associated with BPA, FinCEN has determined that BPA is no longer a primary money laundering concern that warrants the implementation of a special measure under Section 311. Elsewhere in this issue of the Federal Register, FinCEN is publishing a withdrawal of the related finding regarding BPA.

Federal Register, Volume 81 Issue 43 (Friday, March 4, 2016) 
[Federal Register Volume 81, Number 43 (Friday, March 4, 2016)]
[Proposed Rules]
[Pages 11496-11497]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-04768]


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DEPARTMENT OF THE TREASURY

Financial Crimes Enforcement Network

31 CFR Part 1010

RIN 1506-AB30


Financial Crimes Enforcement Network; Withdrawal of Notice of 
Proposed Rulemaking Regarding Banca Privada d'Andorra

AGENCY: Financial Crimes Enforcement Network (``FinCEN''), Treasury.

ACTION: Withdrawal of notice of proposed rulemaking.

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SUMMARY: This document withdraws FinCEN's notice of proposed rulemaking 
seeking to impose the fifth special measure regarding Banca Privada 
d'Andorra (``BPA''), pursuant to Section 311 of the USA PATRIOT Act 
(``Section 311''), codified at 31 U.S.C. 5318A. Because of material 
subsequent developments that have mitigated the money laundering risks 
associated with BPA, FinCEN has determined that BPA is no longer a 
primary money laundering concern that warrants the implementation of a 
special measure under Section 311. Elsewhere in this issue of the 
Federal Register, FinCEN is publishing a withdrawal of the related 
finding regarding BPA.

DATES: The notice of proposed rulemaking is withdrawn as of March 4, 
2016.

FOR FURTHER INFORMATION CONTACT: The FinCEN Resource Center at (800) 
767-2825.

SUPPLEMENTARY INFORMATION: 

I. Background

    On October 26, 2001, the President signed into law the Uniting and 
Strengthening America by Providing Appropriate Tools Required to 
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (``the 
USA PATRIOT Act''). Title III of the USA PATRIOT Act amends the anti-
money laundering provisions of the Bank Secrecy Act (``BSA''), codified 
at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314, 5316-
5332, to promote the prevention, detection, and prosecution of 
international money laundering and the financing of terrorism. 
Regulations implementing the BSA appear at 31 CFR Chapter X. The 
authority of the Secretary of the Treasury to administer the BSA and 
its implementing regulations has been delegated to the Director of 
FinCEN.
    Section 311 of the USA PATRIOT Act (``Section 311'') grants the 
Director of FinCEN the authority, upon finding that reasonable grounds 
exist for concluding that a foreign jurisdiction, foreign financial 
institution, class of transactions, or type of account is of ``primary 
money laundering concern,'' to require domestic financial institutions 
and financial agencies to take certain ``special measures'' to address 
the primary money laundering concern. The special measures enumerated 
under Section 311 are prophylactic safeguards that defend the U.S. 
financial system from money laundering and terrorist financing. FinCEN 
may impose one or more of these special measures in order to protect 
the U.S. financial system from these threats. To that end, special 
measures one through four, codified at 31 U.S.C. 5318A(b)(1)-(b)(4), 
impose additional recordkeeping, information collection, and 
information reporting requirements on covered U.S. financial 
institutions. The fifth special measure, codified at 31 U.S.C. 
5318A(b)(5), allows the Director to prohibit or impose conditions on 
the opening or maintaining of correspondent or payable-through accounts 
by covered U.S. financial institutions.

II. The Finding and Notice of Proposed Rulemaking

    On March 13, 2015, FinCEN provided notice in the Federal Register 
that it had found Banca Privada d'Andorra (``BPA''), a bank 
headquartered in Andorra, to be of primary money laundering concern.\1\ 
Based on the finding, FinCEN also published on March 13, 2015 a notice 
of proposed rulemaking (``NPRM'') proposing the imposition of the fifth 
special measure with respect to BPA, and invited public

[[Page 11497]]

comment.\2\ Specifically, FinCEN proposed to prohibit covered financial 
institutions from establishing, maintaining, administering, or managing 
in the United States any correspondent account for, or on behalf of, 
BPA. FinCEN also proposed to require a covered financial institution to 
apply special due diligence to all of its foreign correspondent 
accounts that is reasonably designed to guard against processing 
transactions involving BPA. Among other things, covered financial 
institutions would have been required to notify those foreign 
correspondent account holders that the covered financial institutions 
know or have reason to know provide services to BPA that such 
correspondents may not provide BPA with access to the correspondent 
account maintained at the covered financial institution.
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    \1\ 80 FR 13,464 (Mar. 13, 2015).
    \2\ 80 FR 13,304 (Mar. 13, 2015) (RIN 1506-AB30). FinCEN 
publicly announced the finding and NPRM on March 10, 2015.
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III. Subsequent Developments

    Significant developments regarding BPA have occurred since FinCEN 
announced its finding and related NPRM regarding BPA, as described 
below. As a result, BPA is no longer operating as a financial 
institution that poses a money laundering threat to the U.S. financial 
system.
    On March 11, 2015, the Institut Nacional Andorr[agrave] de Finances 
(``INAF''), the Andorran regulator and supervisor of financial 
institutions, appointed two INAF representatives to oversee BPA's 
operations. On March 12, 2015, the INAF suspended the authority of 
BPA's board of directors, the chief executive officer and two other 
senior managers and appointed special administrators to assume full 
control of BPA. On March 13, 2015, Andorran law enforcement arrested 
BPA's chief executive officer in Andorra on suspicion of money 
laundering.
    The next month, in April 2015, the Andorran parliament enacted a 
law regarding the restructuring and resolution of banks, which created 
a new government agency, Ag[egrave]ncia Estatal de Resoluci[oacute] 
d'Entitats Banc[agrave]ries (``AREB''), for that purpose. On April 27, 
2015, AREB took over control of BPA.\3\ In June 2015, AREB approved a 
resolution plan for BPA, under which the bank's ``good'' and ``bad'' 
assets, liabilities, and clients would be separated. Under the 
resolution plan, the ``good'' assets, liabilities, and clients are to 
be transferred to a bridge bank, and the bridge bank sold.\4\ In July 
2015, AREB announced the creation of the bridge bank, named Vall Banc, 
to receive the transfer of BPA's legitimate assets, liabilities, and 
clients. Vall Banc is wholly-owned by AREB, is registered with the 
INAF, and is supervised by Andorran banking supervisory authorities. 
Vall Banc will not employ the high-level BPA managers described in 
FinCEN's Notice of Finding. In addition, any other person who has been 
or may be identified as related to the issues described in the Notice 
of Finding will not be employed at Vall Banc.
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    \3\ Press Release, AREB, AREB Assumes the Tutelage of BPA, April 
27, 2015, (http://areb.ad/images/areb/comunicats/27042015_AREB_ENG.pdf)
    \4\ Press Release, AREB, AREB Will Create a `Good Bank' with 
Legitimate Assets and Liabilities Segregated from BPA, June 15, 
2015, (http://areb.ad/images/areb/comunicats/15062015_AREB_ENG.pdf)
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    After the good assets, liabilities, and clients are transferred 
from BPA to Vall Banc, BPA will remain under the control of AREB. 
FinCEN understands that BPA will not be reactivated as an operational 
financial institution at any point except to facilitate the 
finalization of the resolution process. AREB, in coordination with 
other authorities in Andorra, ultimately intends to liquidate BPA 
following the resolution of judicial proceedings in Andorra and other 
jurisdictions.

IV. Withdrawal of the NPRM

    Because of these subsequent developments, BPA no longer operates in 
a manner that poses a money laundering threat to the U.S. financial 
system. FinCEN has determined that the steps taken by the authorities 
in Andorra sufficiently protect the U.S. financial system from the 
money laundering risks previously associated with BPA. FinCEN therefore 
has determined that BPA no longer is a primary money laundering concern 
and will not impose any special measures under Section 311 with respect 
to BPA.
    For these reasons, FinCEN hereby withdraws its NPRM published on 
March 13, 2015, and announced on March 10, 2015, seeking to impose the 
fifth special measure regarding BPA.

 Jamal El-Hindi,
Deputy Director, Financial Crimes Enforcement Network.
[FR Doc. 2016-04768 Filed 3-3-16; 8:45 am]
 BILLING CODE 4810-02-P

11496 Federal Register / Vol. 81, No. 43 / Friday, March 4, 2016 / Proposed Rules ■ Par. 6. Section 1.6662–8 is added to (d)(2)(xxxiv), and adding paragraph Public Law 107–56 (‘‘the USA PATRIOT read as follows: (d)(2)(xxxv). Act’’). Title III of the USA PATRIOT Act The addition reads as follows: amends the anti-money laundering § 1.6662–8 Inconsistent estate basis reporting. § 301.6722–1 Failure to furnish correct provisions of the Bank Secrecy Act payee statements. (‘‘BSA’’), codified at 12 U.S.C. 1829b, 12 (a) In general. Section 6662(a) and (b)(8) impose an accuracy-related * * * * * U.S.C. 1951–1959, and 31 U.S.C. 5311– penalty on the portion of any (d) * * * 5314, 5316–5332, to promote the underpayment of tax required to be (2) * * * prevention, detection, and prosecution shown on a return that is attributable to (xxxv) Section 6035 (relating to basis of international money laundering and an inconsistent estate basis. of property acquired from decedents). the financing of terrorism. Regulations (b) Inconsistent estate basis. In * * * * * implementing the BSA appear at 31 CFR accordance with section 6662(k), there Chapter X. The authority of the is an inconsistent estate basis to the John Dalrymple, Secretary of the Treasury to administer extent that a taxpayer claims a basis, Deputy Commissioner for Services and the BSA and its implementing without regard to the adjustments Enforcement. regulations has been delegated to the described in § 1.1014–10(a)(2), in [FR Doc. 2016–04718 Filed 3–2–16; 4:15 pm] Director of FinCEN. property described in paragraph (c) of BILLING CODE 4830–01–P Section 311 of the USA PATRIOT Act this section that exceeds that property’s (‘‘Section 311’’) grants the Director of final value as determined under FinCEN the authority, upon finding that § 1.1014–10(c). DEPARTMENT OF THE TREASURY reasonable grounds exist for concluding (c) Applicable property. The property Financial Crimes Enforcement Network that a foreign jurisdiction, foreign to which this section applies is property described in § 1.1014–10(b) that is financial institution, class of 31 CFR Part 1010 transactions, or type of account is of reported or required to be reported on a return required by section 6018 filed RIN 1506–AB30 ‘‘primary money laundering concern,’’ after July 31, 2015. to require domestic financial (d) Effective/applicability date. Upon Financial Crimes Enforcement institutions and financial agencies to the publication of the Treasury Decision Network; Withdrawal of Notice of take certain ‘‘special measures’’ to adopting these rules as final in the Proposed Rulemaking Regarding address the primary money laundering Federal Register, this section will apply Banca Privada d’Andorra concern. The special measures to property described in § 1.1014–10(b) AGENCY: Financial Crimes Enforcement enumerated under Section 311 are acquired from a decedent or by reason Network (‘‘FinCEN’’), Treasury. prophylactic safeguards that defend the of the death of a decedent whose return U.S. financial system from money ACTION: Withdrawal of notice of required by section 6018 is filed after laundering and terrorist financing. proposed rulemaking. July 31, 2015. Persons may rely upon FinCEN may impose one or more of these rules before the date of SUMMARY: This document withdraws these special measures in order to publication of the Treasury Decision FinCEN’s notice of proposed rulemaking protect the U.S. financial system from adopting these rules as final in the seeking to impose the fifth special these threats. To that end, special Federal Register. measure regarding Banca Privada measures one through four, codified at d’Andorra (‘‘BPA’’), pursuant to Section 31 U.S.C. 5318A(b)(1)–(b)(4), impose PART 301—PROCEDURE AND 311 of the USA PATRIOT Act (‘‘Section ADMINISTRATION additional recordkeeping, information 311’’), codified at 31 U.S.C. 5318A. collection, and information reporting ■ Par. 7. The authority citation for part Because of material subsequent requirements on covered U.S. financial 301 continues to read in part as follows: developments that have mitigated the institutions. The fifth special measure, money laundering risks associated with codified at 31 U.S.C. 5318A(b)(5), Authority: 26 U.S.C. 7805 * * * BPA, FinCEN has determined that BPA allows the Director to prohibit or ■ Par. 8. Section 301.6721–1 is is no longer a primary money amended by removing the word ‘‘or’’ at impose conditions on the opening or laundering concern that warrants the the end of paragraph (g)(2)(x), removing maintaining of correspondent or implementation of a special measure the period and adding ‘‘; or’’ at the end payable-through accounts by covered under Section 311. Elsewhere in this of paragraph (g)(2)(xi), and adding issue of the Federal Register, FinCEN is U.S. financial institutions. paragraph (g)(2)(xii). publishing a withdrawal of the related II. The Finding and Notice of Proposed The addition reads as follows: finding regarding BPA. Rulemaking § 301.6721–1 Failure to file correct DATES: The notice of proposed information returns. rulemaking is withdrawn as of March 4, On March 13, 2015, FinCEN provided 2016. notice in the Federal Register that it had * * * * * FOR FURTHER INFORMATION CONTACT: The found Banca Privada d’Andorra (g) * * * (2) * * * FinCEN Resource Center at (800) 767– (‘‘BPA’’), a bank headquartered in (xii) Section 6035 (relating to basis of 2825. Andorra, to be of primary money jstallworth on DSK7TPTVN1PROD with PROPOSALS property acquired from decedents). laundering concern.1 Based on the SUPPLEMENTARY INFORMATION: finding, FinCEN also published on * * * * * ■ Par. 9. Section 301.6722–1 is I. Background March 13, 2015 a notice of proposed amended by removing the word ‘‘or’’ at On October 26, 2001, the President rulemaking (‘‘NPRM’’) proposing the the end of paragraph (d)(2)(xxxiii), signed into law the Uniting and imposition of the fifth special measure removing the period and adding a semi- Strengthening America by Providing with respect to BPA, and invited public colon in its place followed by the word Appropriate Tools Required to Intercept 1 80 FR 13,464 (Mar. 13, 2015). ‘‘or’’ at the end of paragraph and Obstruct Terrorism Act of 2001, VerDate Sep<11>2014 16:38 Mar 03, 2016 Jkt 238001 PO 00000 Frm 00043 Fmt 4702 Sfmt 4702 E:\FR\FM\04MRP1.SGM 04MRP1

Federal Register / Vol. 81, No. 43 / Friday, March 4, 2016 / Proposed Rules 11497 comment.2 Specifically, FinCEN and the bridge bank sold.4 In July 2015, ENVIRONMENTAL PROTECTION proposed to prohibit covered financial AREB announced the creation of the AGENCY institutions from establishing, bridge bank, named Vall Banc, to maintaining, administering, or receive the transfer of BPA’s legitimate 40 CFR Part 52 managing in the United States any assets, liabilities, and clients. Vall Banc [EPA–R10–OAR–2015–0353, FRL–9943–24– correspondent account for, or on behalf is wholly-owned by AREB, is registered Region 10] of, BPA. FinCEN also proposed to with the INAF, and is supervised by require a covered financial institution to Andorran banking supervisory Approval and Promulgation of apply special due diligence to all of its authorities. Vall Banc will not employ Implementation Plans; Alaska: foreign correspondent accounts that is Updates to Incorporation by Reference the high-level BPA managers described reasonably designed to guard against and Miscellaneous Revisions in FinCEN’s Notice of Finding. In processing transactions involving BPA. Among other things, covered financial addition, any other person who has AGENCY: Environmental Protection institutions would have been required been or may be identified as related to Agency (EPA). to notify those foreign correspondent the issues described in the Notice of ACTION: Proposed rule. account holders that the covered Finding will not be employed at Vall Banc. SUMMARY: The Environmental Protection financial institutions know or have Agency (EPA) proposes to approve reason to know provide services to BPA After the good assets, liabilities, and certain State Implementation Plan that such correspondents may not clients are transferred from BPA to Vall revisions submitted by Alaska on May provide BPA with access to the Banc, BPA will remain under the 12, 2015. The revisions updated the correspondent account maintained at control of AREB. FinCEN understands incorporation by reference of certain the covered financial institution. that BPA will not be reactivated as an Federal provisions, revised rules to III. Subsequent Developments operational financial institution at any reflect changes to Federal permitting point except to facilitate the finalization requirements and the 2013 Significant developments regarding of the resolution process. AREB, in redesignation of the Mendenhall Valley BPA have occurred since FinCEN coordination with other authorities in area of Juneau, and made minor announced its finding and related Andorra, ultimately intends to liquidate clarifications. We note that the May 12, NPRM regarding BPA, as described BPA following the resolution of judicial 2015 submission also addressed below. As a result, BPA is no longer proceedings in Andorra and other transportation conformity and operating as a financial institution that jurisdictions. infrastructure requirements. These poses a money laundering threat to the requirements are not being addressed in U.S. financial system. On March 11, 2015, the Institut IV. Withdrawal of the NPRM this action. We approved the Nacional Andorrà de Finances transportation conformity revisions in a Because of these subsequent previous action on September 8, 2015 (‘‘INAF’’), the Andorran regulator and developments, BPA no longer operates supervisor of financial institutions, and we intend to address the in a manner that poses a money infrastructure requirements in a appointed two INAF representatives to laundering threat to the U.S. financial oversee BPA’s operations. On March 12, separate, future action. system. FinCEN has determined that the DATES: Comments must be received on 2015, the INAF suspended the authority steps taken by the authorities in or before April 4, 2016. of BPA’s board of directors, the chief Andorra sufficiently protect the U.S. ADDRESSES: Submit your comments, executive officer and two other senior managers and appointed special financial system from the money identified by Docket ID No. EPA–R10– administrators to assume full control of laundering risks previously associated OAR–2015–0353, at http:// BPA. On March 13, 2015, Andorran law with BPA. FinCEN therefore has www.regulations.gov. Follow the online enforcement arrested BPA’s chief determined that BPA no longer is a instructions for submitting comments. executive officer in Andorra on primary money laundering concern and Once submitted, comments cannot be suspicion of money laundering. will not impose any special measures edited or removed from http:// The next month, in April 2015, the under Section 311 with respect to BPA. www.regulations.gov. The EPA may Andorran parliament enacted a law For these reasons, FinCEN hereby publish any comment received to its regarding the restructuring and withdraws its NPRM published on public docket. Do not submit resolution of banks, which created a March 13, 2015, and announced on electronically any information you new government agency, Agència consider to be Confidential Business March 10, 2015, seeking to impose the Estatal de Resolució d’Entitats Bancàries Information (CBI) or other information fifth special measure regarding BPA. (‘‘AREB’’), for that purpose. On April the disclosure of which is restricted by 27, 2015, AREB took over control of Jamal El-Hindi, statute. Multimedia submissions (audio, BPA.3 In June 2015, AREB approved a Deputy Director, Financial Crimes video, etc.) must be accompanied by a resolution plan for BPA, under which Enforcement Network. written comment. The written comment the bank’s ‘‘good’’ and ‘‘bad’’ assets, [FR Doc. 2016–04768 Filed 3–3–16; 8:45 am] is considered the official comment and liabilities, and clients would be should include discussion of all points BILLING CODE 4810–02–P separated. Under the resolution plan, you wish to make. The EPA will the ‘‘good’’ assets, liabilities, and clients generally not consider comments or jstallworth on DSK7TPTVN1PROD with PROPOSALS are to be transferred to a bridge bank, comment contents located outside of the primary submission (i.e. on the web, 2 80 FR 13,304 (Mar. 13, 2015) (RIN 1506–AB30). cloud, or other file sharing system). For FinCEN publicly announced the finding and NPRM 4 Press Release, AREB, AREB Will Create a ‘Good additional submission methods, the full on March 10, 2015. EPA public comment policy, 3 Press Release, AREB, AREB Assumes the Bank’ with Legitimate Assets and Liabilities Tutelage of BPA, April 27, 2015, (http://areb.ad/ Segregated from BPA, June 15, 2015, (http:// information about CBI or multimedia images/areb/comunicats/ areb.ad/images/areb/comunicats/ submissions, and general guidance on 27042015_AREB_ENG.pdf) 15062015_AREB_ENG.pdf) making effective comments, please visit VerDate Sep<11>2014 14:02 Mar 03, 2016 Jkt 238001 PO 00000 Frm 00044 Fmt 4702 Sfmt 4702 E:\FR\FM\04MRP1.SGM 04MRP1


Document Created: 2018-02-02 15:05:14
Document Modified: 2018-02-02 15:05:14
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionWithdrawal of notice of proposed rulemaking.
DatesThe notice of proposed rulemaking is withdrawn as of March 4, 2016.
ContactThe FinCEN Resource Center at (800) 767-2825.
FR Citation81 FR 11496 
RIN Number1506-AB30
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