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After 9-11, Congress passed the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (USA PATRIOT Act) to fight terrorism
and protect our financial system from terrorist money laundering
schemes and other acts of terrorism.
This Act made it critical for financial institutions
to verify the identity of customers. The Department of the Treasury
issued regulations implementing information sharing provisions contained
in section 314 of the Act. The regulation requires financial institutions
to take the necessary steps to protect the confidentiality of the
information and to use the information only for the purposes specified
in the rule. Protecting the integrity of the customer record is
crucial in supporting the validity of the monitoring and investigation
of money laundering and terrorist financing schemes.
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