The Treasury Department’s Financial Crimes Enforcement Network (FinCen) has issued a final rule under section 311 of the USA Patriot Act to further restrict North Korea’s access to the U.S. financial system. Specifically, the final rule prohibits U.S. financial institutions from opening or maintaining correspondent accounts for North Korean banks and also requires U.S. financial institutions to apply additional due diligence measures in order to prevent North Korean financial institutions from gaining improper indirect access to U.S. correspondent accounts. The rule was proposed in June along with publication of a notice of finding that North Korea is a jurisdiction of “primary money laundering concern” engaged in illicit conduct, including using state-controlled financial institutions and front companies to engage in proliferation of weapons of mass destruction and ballistic missiles and evade international sanctions.
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