January 18, 2011 > American banks dropping UN mission accounts
American banks dropping UN mission accounts
By Anita Snow, Associated Press
UNITED NATIONS (AP), Jan 11 - Several American banks are closing the accounts of U.N. diplomatic missions in an apparent response to more rigorous U.S. federal reporting rules, U.N. and American officials confirm.
A Jan. 7 diplomatic note from the U.S. Mission to the United Nations says ambassadors and mission chiefs will be briefed at U.N. headquarters Thursday about ``recent developments concerning the bank accounts of diplomatic missions.'' An announcement of the briefing also appears in the Journal of the United Nations.
U.S. mission spokesman Mark Kornblau declined to comment on why the banks were closing the accounts.
JPMorgan Chase & Co. is among the banks eliminating accounts held by diplomatic missions and other foreign government entities.
The bank assured ambassadors in a Sept. 30 letter that ``this business decision does not reflect on your organization or how you have handled your account(s).'' It added that personal accounts would not be affected.
The letter did not explain why the accounts were being closed. Tom Kelly of Chase media relations said he could not comment on the action involving the bank's customers.
The Wall Street Journal reported in November that some of America's largest U.S. banks are closing bank accounts held by embassies and other foreign missions because of onerous reporting regulations for overseas transactions that were tightened after the Sept. 11 terrorist attacks.
The rules aim to prevent the illegal flow of foreign funds for such crimes as money laundering, terrorism financing and drug trafficking.
American financial institutions already have been required to report to federal authorities all cash transactions over $10,000 - both foreign and domestic - as well as other transactions that look suspicious. But under a U.S. Treasury Department proposal, those regulations would be tightened even further, requiring banks to report every week on all electronic money transfers into and out of the United States, no matter how small.
JP Morgan Chase gave foreign missions until March 31 to close their accounts.
The United Nations said it was aware of the situation, but that it was up to the missions themselves, and the United States as host country, to deal with the problem.