Federal Reserve Rules on Bank Wire Transfers
- Bank wire transfers must comply with federal rules.bank image by Pefkos from Fotolia.com
The Federal Reserve is the central banking system in the United States. It helps to determine interest rates, protects the value of the American dollar and plays a role in the implementation of economic and banking policies. The Federal Reserve maintains 12 branches in major cities all across the country. - Bank wire transfers that come from foreign nations must comply with strict rules. Transfers cannot go directly to a Federal Reserve bank from a foreign nation. However, an American bank can be used as an intermediary in a "double wire transfer" format, where the money from overseas is transferred to an American bank, which then immediately transfers the money to a Federal Reserve bank. Federal Reserve banks are required to keep records of most transfers that originate from foreign nations.
- Banks must provide disclosures to customers who use wire transfers. These disclosures are supposed to be provided immediately. They can be provided in a foreign language if the person or company involved in a wire transfer is from a non-English speaking nation. Timing, fees and reporting to government agencies or third parties should all be clearly laid out at the time of a wire transfer. Specifically, all banks in the United States should disclose that the usual privacy policy for clients can be overturned in the case of a criminal investigation.
- Banks are required to keep records of wire transfers for at least two years to the day after the transfer takes place. If this date falls on a nonbusiness day, the bank must hold the records until the next open business day. In addition, a bank must maintain records for any wire transfer that is under investigation or may be involved in a criminal investigation. Banks receive notice from the appropriate investigative unit about any transfers, companies, individuals or specific transactions that involve records that should be preserved.
Foreign Nations
Disclosures
Records
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