Patriot Act industry

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An almost immediate response to the events of September 11, 2001, was the emergence of a Homeland defense industry. Various compliance issues mandated in Patriot Act I have similarly given birth to a Patriot Act industry.

One might conclude that compliance requirements placed upon banking and other sectors of business and industry are, in the least, burdensome. However, as there always is, there is a flip side to this coin. For example, financial institutions are required to manage client data in a concentrated and coordinated search for terrorists laundering money or performing other illegal financial activities. This requirement, however, also allows financial institutions to have much greater access to, as well as the ability to create, a massive customer information data base.

The following sample advertisements taken from a selection of Patriot Act industry organizations and businesses indicate the extent to which "compliance" with Patriot Act I could be interpreted to mean much more.

Primary Payments' 'Identity Chek' reinforces this point: "To effectively combat this [illegal financial] activity, institutions may engage technology to automate the verification process, maintain records of the methods employed, and archive information furnished during account opening.

"However, there is a more immediate and present danger that must be taken into consideration. In the past several years, there has been a dramatic increase in identity related crimes. Knowing this, an ideal solution will simultaneously detect this fraudulent activity thereby mitigating potential losses.
"IDENTITY CHEK has this greater capability, turning a program that was initially driven by compliance into one that generates a positive return on investment."

Banking

The USA PATRIOT Act of 2001 greatly expanded the regulatory framework designed to safeguard the U.S. financial system from illegal misuse including the financing of terroism.
The USA PATRIOT Act in conjunction with existing BSA (Bank Secrecy Act) and OFAC (Office of Foreign Assets Control) regulations, measurably strengthens America's defenses against fraud, terrorism and illegal drug activity. However, these new and expanded regulations also create an additional layer of complexity for the compliance professional.
Compliance Analyzer, USA PATRIOT Act compliance software. Compliance Analyzer ensures that your data is scanned against the latest information from OFAC (Office of Foreign Asset Control) and other relevant government lists.
Section 326 of the USA PATRIOT Act requires financial institutions and others to implement a customer identification program by October 1, 2003. Will you be ready?
What the U.S. Treasury requires: (Section 326 of the USA PATRIOT Act)
  • That financial institutions develop a Customer Identification Program (CIP) that implements reasonable procedures to:
  • Collect identifying information about customers opening an account
  • Verify that the customers are who they say they are
  • Maintain records of the information used to verify their identity
  • Determine whether the customer appears on any list of suspected terrorists or terrorist organizations
The USA PATRIOT Act, signed into law on October 26, 2001, essentially combines the Bank Security Act anti-money laundering requirements with the trade sanctions imposed by OFAC (Office of Foreign Asset Control). In broad terms, financial institutions must make sure that would-be clients really are who they say, and further that they're not on any terrorism watch list. As a result, the USA PATRIOT Act delivers four primary directives to financial institutions:
  • Identify your clients and account holders, both private and commercial
  • Block transactions with entities identified on the OFAC and other criminal/suspect lists
  • Determine and report suspicious activities without blocking them
  • Share information with other financial service providers (FSPs) to aid in determining suspicious activity
Our solution: Firstlogic's compliance solution allows companies to identify, compare and track client records against known subjects on the OFAC Specially Designated Nations (SDN) and Block Persons, as well as virtually any other "most wanted" lists published by governing authorities. This functionality helps companies identify and understand relationships between specific records in their systems that may be affected by compliance rules, and guard against performing transactions with these prohibited organizations or groups. The solution is also robust enough to be used by local, state and federal government agencies to identify individuals involved in tax evasion or any other criminal act against the governing authority.
In addition, Firstlogic's technology can be leveraged within multiple business processes to ensure that organizations are analyzing and acting on cleansed data. By developing and implementing a program that ensures quality data, organizations are able to perform powerful linking capabilities or householding, access a 360-degree view of clients, and ensure the right communications are going to the right client.
Sophisticated real-time matching aids in identification: Clean and validated information ensures that your organization will maximize the matching accuracy of client records against the OFAC list mandated by the USA PATRIOT Act.
Firstlogic's sophisticated matching capabilities enable companies and government agencies to identify complex relationships between and among suspect individuals and groups on the list ... technology can be used to match and associate entities across various data sources to understand hidden social networks and relationships. Law enforcement and interdiction agencies can use the software to relate travel, purchase records or other patterns of behavior to these hidden networks.

Penley's 'Fast Watch' appears to be the cream that rises most quickly to the top, though:

Penley eliminates the anxiety of USA Patriot Act compliance by providing financial institutions with the most comprehensive tool available in the market. Fast Watch provides a simple and cost effective solution that allows any institution to immediately comply with OFAC and the USA Patriot Section 326, Section 314(a) and OFAC. By cross checking over 17 billion aggregated records, Fast Watch assesses, within seconds, the accuracy of all presented identity information and provides the financial institution with enough information to make a reasonable determination if a new account should be opened.

Information Management

DataMirror's flexible and scalable software solutions empower companies with a single, 360-degree view of corporate and customer data, enabling them to make better business decisions, be more productive, and ultimately deliver better results. Over 1,700 companies worldwide use DataMirror's best-of-breed solutions to streamline business processes and enhance operational efficiencies.
DataMirror's software solutions enable a wide range of business applications including e-Business, business intelligence, enterprise application integration, CRM and others. The solutions also allow companies to meet the integration, protection, and auditing requirements of such regulations as HIPAA, 21 CFR Part 11, Basel II, Sarbanes-Oxley, the Patriot Act, and others. Whether you require a solution to manage and integrate data across your enterprise and beyond, or need to provide your users with timely and continuous access to corporate information, DataMirror has a solution to meet all of your business needs.

New Industries

The Act, as has Homeland defense and Homeland security, has produced numerous other related industries:

  • Newsletters and eZines.
  • Researchers, writers, publishers.
  • Book sellers:
  • Amazon.com, which offers USA Patriot Act by Alphonse B. Ewing and other related publications on its web site.
  • Legal opinions.
  • Analysis:
  • The Media in all its various formats, including editorials/Op-Ed.
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