U.S. financial institutions are still struggling to detect and properly monitor foreign banks and clients for whom they process correspondent transactions nearly a decade after more stringent rules governing such relationships took effect, according to a federal regulator. Since 2008, the U.S. Treasury Department's Financial Crimes Enforcement Network, or FinCEN, has required banks in the United States to apply enhanced due diligence to correspondent accounts, which are often prone to abuse by money launderers and blacklisted individuals and entities seeking to circumvent U.S. sanctions. The rule made foreign correspondent accounts the "only" customer-type accounts beyond those for foreign politicos and...
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