Adviser Anti-Money Laundering Program & Compliance with USA Patriot Act
“Money laundering” is a scheme designed to conceal or disguise the source of money obtained illegally. Congress enacted the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (“USA PATRIOT Act”) on October 26, 2001 in response to the terrorist events that occurred on September 11, 2001.
The USA PATRIOT ACT created new anti-money laundering (AML) requirements for financial institutions, including, for the first time, hedge funds and investment companies. Financial institutions that fail to comply with these requirements face exposure to severe civil and criminal penalties.
While Investment advisers do not meet the definition of a “financial institution”, an investment adviser that has private investment company and mutual fund clients, however, must implement or arrange for the implementation of anti-money laundering procedures for the investment company clients. Banks and broker-dealers registered as investment advisers are required to comply with anti-money laundering laws. Moreover, an investment adviser that is “willfully blind” to money laundering that is occurring within accounts that it manages may be subject to criminal liability. See 18 U.S.C. §§ 1956 and 1957.
Coe Hill Advisors, LLC (the “Adviser”) is a registered investment adviser and commodity trading advisor firm. It is not a “financial institution”, and does not currently have private investment company or mutual fund clients.
Nonetheless, to the extent applicable given the firm’s type, scope of client base, nature of business, and available compliance resources, Coe Hill Advisors, LLC fully complies with provisions found within the USA Patriot Act as they relate to Anti-Money Laundering (AML). The AML protocol includes provisions for identification of, monitoring and reporting instances where potential suspicious activity or money laundering is suspected.
USA PATRIOT Act Requirements
§ 352 of the USA PATRIOT Act requires a financial institution (as defined in § 31 U.S.C. Section 5318(j)(1)) to implement an anti-money laundering program that has, at a minimum, the following four requirements:
1. Policies, procedures and controls designed to detect and prevent money laundering;
2. A compliance officer whose role is to oversee the program;
3. Training for employees on how to detect and prevent money laundering; and
4. Periodic audits of the anti-money laundering program.
If you have any questions about these policies, please contact the Adviser’s Chief Compliance Officer, Kevin Laffey at: info@coehilladvisors.com or at +1 (603) 724-6721.
