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News Releases
11/26/2003 USA PATRIOT Act Monitor News Release: SAR Requirements
Finalized for FCMs
Final Rules Require Futures Commission Merchants and Introducing Brokers in
Commodities to File SARs
In May 2003, the Financial Crimes Enforcement Network published proposed regulations
to extend the reporting and recordkeeping obligations of the BSA to futures
commission merchants (FCMs) and introducing brokers in commodities (IB-Cs).
FinCEN received comments on the proposed rules from the National Futures Association
and the Futures Industry Association, and has now issued the rules in final
form (68 Fed. Reg. 65392, November 20, 2003). Relatively few changes were made
to the proposed rules. The final rules do clarify that entities registering
with both the CFTC and the SEC for purposes other than dealing in securities
futures products must satisfy the suspicious activity reporting requirements
applicable either to FCMs and IB-Cs (31 CFR 103.17) or those applicable to BDs
(31 CFR 103.19). Compliance with either regulation will be deemed to be compliance
with the other, so that dual registrants are not subject to conflicting reporting
requirements. The preamble contains a discussion of situations where a SAR should
be filed by an FCM or IB-C, and describes some "red flags" where a
SAR may, or may not, be appropriate. The new rules will be discussed in detail
in a forthcoming issue of the Monitor.