Snow Welcomes Renewal Of US Patriot Act

by Glen Shapiro, LawAndTax-News.com, New York

13 March 2006

Speaking on Thursday, US Treasury Secretary John Snow welcomed the renewal of the USA Patriot Act, which took place after a great deal of political wrangling on the subject.

He announced that:

"The President's signature today on the renewal of the USA Patriot Act enables us to continue to fight the war on terror with the tools necessary to do the job."

"At the Treasury Department, the Patriot Act has significantly advanced the financial war on terror. While hatred fuels the terrorist agenda, it is money that makes it possible for them to carry out their ruthless acts."

The Patriot Act enables the Treasury to better track and identify terrorist funds through effective sharing of information with the financial sector both vertically – between the government and the industry – and horizontally – by providing a safe harbor that allows industry members to also share information with each other. This sheds more light on the financial system as terrorists seek to conceal their funding.

The Patriot Act has also, according to Mr Snow, assisted the Treasury in preventing money laundering and terrorist financing through greater transparency of correspondent accounts maintained by US banks on behalf of foreign banks.

Notably the Act expressly prohibits shell banks from participating in the US financial system and insists upon strict record keeping regarding the ownership of each non-US bank that maintains a correspondent account with a US institution.

The passage of the legislation is being viewed as a victory by Republicans. However, the Act passed the House by a very narrow margin, and several new curbs were placed on the powers of the US authorities to monitor the country's citizens for potential terrorist activities.

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