February 17, 2003 News Archive

Protective Measures under the Homeland Security Advisory System
On Friday, February 7, 2003, the Homeland Security Advisory System was raised to Orange (High) from Yellow (Elevated). All financial institutions are encouraged to become familiar with the National Infrastructure Protection Center's precautions recommended to protect against this heightened threat environment.

Regulation K Interpretation Concerning Securities Underwriting by Foreign Banks
The Board issued an interpretation (PDF) concerning the underwriting by foreign banks of securities to be distributed in the United States. The interpretation clarifies that a banking organization that wishes to engage in underwriting securities that are to be distributed in the United States must be either a financial holding company or have authority to engage in underwriting activity under section 4(c)(8 ) of the Bank Holding Company Act.

USA PATRIOT Act - Section 314(a) Information Requests Reinstated
The Board issued SR 03-3 related to the lifting of the moratorium imposed by the Treasury Department on information requests associated with section 314(a) of the USA PATRIOT Act. As announced (PDF) by the Financial Crimes Enforcement Network (FinCEN), information requests will resume on February 18, 2003. The moratorium was issued on November 26, 2002 to address logistical issues and develop additional guidance on the information request process.

Significant changes to the 314(a) process include:

• 314(a) requests from FinCEN will be batched and issued every two weeks, unless otherwise indicated in the request.
• Financial institutions will have two weeks to complete the searches and respond with any matches.
• Searches will be limited to specific records and, unless otherwise noted, will be a one-time search.
• If a match is identified for a named subject, the institution needs to respond only to FinCEN that it has a match and provide contact information for the requesting law enforcement agency to follow-up directly with the institution. (NOTE: No details need to be provided on this particular response to FinCEN, other than the fact that a match has been made on the named subject).

Vice Chairman Ferguson Remarks on September 11, the Federal Reserve, and the Financial System
In a speech delivered at the Vanderbilt University in Nashville, Tennessee, Fed Vice Chairman Roger W. Ferguson, Jr., remarked on the actions of the Federal Reserve following the September 11, 2001, terrorist attacks and the lessons learned from the 911 incidents.