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Anti Money Laundering

Administrative Policy Number: IC-600
Policy Title:  Anti Money Laundering
Effective Date:  4/18/2022

I. Scope

Following the terrorist attacks of September 11, 2001, the U.S. Government instituted several initiatives to ensure that charitable funds were not diverted to terrorists and their organizations in the United States and around the world. These included Executive Order 13224 and the USA PATRIOT Act, both issued shortly after 9/11.  Executive Order 13224 prohibits transactions with those entities deemed by the Executive Branch to be associated with terrorism and freezes all assets controlled by or in the possession of these entities and those who support them. Compliance is required with Anti-Money Laundering (AML) obligations imposed by the federal government, including applicable provisions of the Money Laundering Control Act of 1986, the Bank Secrecy Act, the USA PATRIOT Act of 2001, the rules and regulations overseen by the United States Treasury Department’s Office of Foreign Assets Control and Financial Crimes Enforcement Network and other legal requirements.

II. Purpose

This policy aims to enhance the University’s compliance with anti-money laundering laws and regulations, assist law enforcement in combating illegal money laundering, and minimize the risk of the University resources being used for improper purposes.

III. Definitions

Money Laundering - Money laundering is the process by which criminally obtained money or other assets (criminal property) are exchanged for ‘clean’ money or other assets with no obvious link to their criminal origins. Criminal property may take any form, including money or money’s worth, securities, tangible property and intangible property. It also covers money, however it is come by, used to fund terrorism.

Money laundering activity includes:

  • Acquiring, using or possessing criminal property;
  • Handling the proceeds of crimes such as theft, fraud and tax evasion;
  • Knowingly being involved in any way with criminal or terrorist property;
  • Entering into arrangements to facilitate laundering criminal or terrorist property;
  • Investing the proceeds of crimes in other financial products;
  • Investing the proceeds of crimes through the acquisition of property/assets; and
  • Transferring criminal property.
IV. Policy

The University has the responsibility to design and implement procedures that will prevent university services from being used to facilitate money laundering and the financing of terrorist activities. To assist the federal government in detecting, preventing, and eradicating criminal and terrorist financing and activity, the University is responsible for taking all necessary steps to comply with applicable anti-money laundering laws and regulations.   Since 2001, the University has implemented a number of processes and practices to ensure that funds are not distributed improperly.  This policy provides an overarching framework to those processes and practices

A. Compliance Framework

The University has developed processes and controls which keep its daily operations compliant with AML regulations.  It also manages compliance and monitors the University’s efforts for those areas identified as affected activities.

  1. Procurement to Pay (P2P)
    • Vendor Compliance which includes reference OFAC’s list of Specially Designated Nationals and Blocked Persons.
    • Vendor IRS ITIN match
  1. International Travel
    • International travel and security management – restrictions based on destination
    • On-campus foreign visitors Visa Assistance 
  1. Treasury and Bank Management
    • Wire Transfers
      • Funds settle in the domestic US clearing through the Federal Reserve System
      • Funds settle cross-border using the Swift Network 
  1. Student Accounts and Cashiers
    • Touchnet Services are NACHA and PCI compliant for all electronic distributions which includes all student refund.
    • FlyWire services are PCI and SOC II compliant.
    • Cash Receipts => $10K are reported as required. 
  1. Human Resources
    • I-9 Verification 
  1. Foundations
    • Cash Management and Investment Policies and Processes
    • Donor validation 
  1. Office of Sponsored Programs
    • Export Control Compliance Program
    • Sponsored projects/technology transfer (for research conducted by faculty and students on campus as well as research projects conducted abroad). 
  1. Record Keeping in accordance with Commonwealth retention policies
    • Daily records of all transactions processed in ERP
IV. Approval and Amendment

This policy was created by the Office of University Operations and is effective April 18, 2022, and may be amended or terminated by the Chief Operating Officer.

Questions about the implementation of this policy or its interpretation should be directed to the Assistant Vice President for Financial Operations and University Controller.