CISADA Section 104(e): Counter Terrorist Financing Requirements

The Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA), signed into law on July 1, 2010, expanded U.S. sanctions against Iran. A major focus of the measure is to deter transactions that assist the nuclear proliferation efforts of the Iranian government. Rules issued under CISADA may require U.S. banks to identify foreign banks that are facilitating illegal activity with Iran.

CISADA Section 104(e) concerns regulations that require domestic financial institutions maintaining a correspondent account or payable-through account in the U.S. for a foreign financial institution (FFI) to: (a) audit the FFI; or (b) report on transactions or financial services; or (c) certify that the FFI is not knowingly engaged in prohibited activities; or (d) establish due diligence policies, procedures, and controls. U.S. banks need to understand the CISADA’s requirements and comply with them.

For a more detailed explanation of CISADA Section 104(e), take a look at Corporate Compliance Insight’s informative article, CISADA Section 104(e): A Glance Into the Final Rule's Counter Terrorist Financing Requirements and Challenges for U.S. Financial Institutions.