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Reporting MSB/High Risk Accounts to the Board

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Question: 
I've been told by our independent auditor that MSB/High risk accounts must reported to the Board. Is this true?
Answer: 

No, it is not. The existence of high risk accounts is factored into your risk assessment. Obviously, you cannot do that if you have not identified them; i.e., made up a list. The regulators will ask you for a copy of the list in the request letter you receive prior to an on-site BSA examination.

However, there is no regulatory suggestion that the actual list be reported to the board. My opinion is that it's purely an upward delegation of responsibility; i.e., I strongly disagree that it is necessary or appropriate.

First published on BankersOnline.com 1/9/06

First published on 01/09/2006

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